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20 June 2014
Rockville Man Sentenced to over 6 Years in Prison for Distribution of Child PornographyRead the Press Release
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm sentenced Michael Gaskin, age 33, of Rockville, Maryland, today to 78 months in prison, followed by 15 years of supervised release, for distribution of child pornography. Judge Grimm ordered that upon his release from prison, Gaskin must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
According to Gaskin’s plea agreement, on 10 occasions between December 2012 and September 2012, Gaskin sent images documenting the sexual abuse of prepubescent children, including toddlers, to an individual whom Gaskin had met online in a chat room. On December 2, 2013, a search was conducted at Gaskin’s residence and his computer was seized. A forensic analysis of the computer identified 262 images and two videos documenting the sexual abuse of minors.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI for its work in the investigation. Mr. Rosenstein thanked Special Assistant U.S. Attorney LisaMarie Freitas of the U.S. Justice Department, Criminal Division, Child Exploitation and Obscenity Section and Trial Attorney Sarah Chang, also of the U.S. Department of Justice, Criminal Division, Child Exploitation and Obscenity Section, who prosecuted the case.
Rochester Man Sentenced on Drug Trafficking ChargesRead the Press Release
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Jarrel Johnson, 30, of Rochester, N.Y., who was convicted of conspiracy to possess with the intent to distribute and distribution of 280 grams or more of cocaine base, was sentenced to 20 years in prison and 10 years supervised release by U.S. District Court Judge Charles J. Siragusa. The defendant was also sentenced to two years in prison to run concurrent to the 20 year sentence for violating an order of supervised release.
Assistant U.S. Attorney Robert A. Marangola, who handled the case, stated that on December 17, 2012, members of the United States Probation Office conducted a search of Johnson’s residence at 184 Kingsberry Drive, Apartment A, in Rochester. The defendant was under the supervision of a probation officer following a 2009 federal conviction for being a felon in possession of a firearm.
During the search of the apartment, several items of contraband and evidence of narcotics trafficking were found and seized, including a bag with crack cocaine, a digital scale with white residue, two boxes of rubber gloves, numerous small clear plastic bags, and a razor blade with white residue. In addition, law enforcement officers found and seized five clear plastic bags containing crack cocaine in two jackets belonging to Johnson and $4,400 in United States currency in a pair of the defendant’s boots.
The sentencing is the culmination of an investigation on the part of Greater Rochester Area Narcotics Enforcement Team composed of law enforcement personnel in Monroe County, under the direction under the direction of Rochester Police Department Chief Michael Ciminelli, the United States Probation Office, for the Western District of New York, Rochester Office, under the direction of Timothy Englerth and Special Agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon, New York Field Office.Rhode Island Resident Sentenced to 50 Months in Federal Prison for Trafficking Counterfeit Sports Jerseys, Clothing, Health and Beauty ProductsRead the Press Release
PROVIDENCE, R.I. – Norman Cipriano, 41, of Warwick, R.I., was sentenced on Thursday to 50 months in federal prison for trafficking more 14,500 counterfeit sports jerseys, clothing accessories, and health and beauty products valued at more than $1 million dollars, announced United States Attorney Peter F. Neronha, Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations (HSI), and Warwick Police Chief Colonel Stephen M. McCartney.
U.S. District Court Chief Judge William E. Smith also ordered Cipriano to serve 3 years of supervised release upon completion of his prison term. An amount of restitution to be paid by the defendant to various companies impacted in this matter will be determined at a later date. Cipriano pleaded guilty on August 5, 2013, to trafficking in counterfeit goods and services.
“The world-wide theft of intellectual property and the sale of counterfeit goods is, unfortunately, a burgeoning and increasingly dangerous crime. The distribution of counterfeit medications, both over-the-counter, as in this case, and prescription narcotics, as in other cases we have seen, present an obvious health and safety threat. Trafficking in other counterfeit goods, such as apparel and other consumer products, may seem more innocuous, but nevertheless demands the same aggressive attention from law enforcement. Such criminal misconduct causes irreparable economic harm to the companies that make the real article, including such companies’ ability to maintain and create jobs for every-day Americans,” said United States Attorney Peter F. Neronha.
United States Attorney Neronha added, “I am grateful for the vigilance of the Customs and Border Protection agents in Alaska who first recognized the defendant’s attempt to bring counterfeit and illegitimate items to our shores. HSI agents in Rhode Island, working with Warwick Police Detectives and Officers and other federal, state and local law enforcement officials, took it from there, building a strong case that ultimately led to today’s entirely appropriate sentence.”
“The notion that counterfeit products are a victimless crime is absurd. Criminals who sell counterfeit goods are economic leeches that siphon trade from legitimate businesses that pay taxes, create jobs and support our local economy," said Eric Caron, Resident Agent in Charge of HSI Providence."Buying them may appear at first to be a bargain, but when we take into account the common nexus to organized crime or worse, the laborers who may be forced to work in substandard conditions, and the locally owned stores that are forced to close their doors, we see that this ‘victimless crime’ harms all of us in the long run.”
According to information presented to the court, HSI agents in Rhode Island were notified that Customs and Border Protection (CBP) agents in Anchorage, Alaska, conducted a routine border search of a package arriving from the People’s Republic of China addressed to Cipriano and his Warwick residence. The shipment was manifested as “Man Coats.” An examination of the contents revealed sports jerseys affixed with NFL Football and Nike trademarked logos. CBP agents suspected that the display of trademarks was unauthorized.
CBP agents shipped the package to HSI agents in Rhode Island who conducted a controlled delivery of the merchandise to Cipriano’s residence on August 23, 2012, with the assistance of the HSI Boston Gangs/Commercial Fraud Unit and Warwick Police.
Simultaneously, working in conjunction with HSI agents from Boston who had already begun an investigation into Cipriano’s alleged importation and sale of counterfeit merchandise at a flea market in Raynham, Mass., continued the investigation which included multiple visits and surveillance of Cipriano’s activities at the flea market and at his home.
On September 19, 2012, HSI agents from Rhode Island and Boston, assisted by agents and officers from the United States Postal Inspection Service and the Warwick Police Department, executed a court authorized search of Cipriano’s home and two vehicles used to transport the counterfeit goods. The agents seized nearly 5,000 counterfeit sports jerseys, wearing apparel and accessories, and health and beauty aids - including a significant quantity of counterfeit over-the-counter medications. In total, agents seized approximately 14,700 counterfeit items conservatively valued at more than $1.02 million dollars and nearly $56,000 in cash, money orders and a bank check. The following day the government seized a bank account containing more than $76,000 which belonged to Cipriano.
Queries of CBP data bases disclosed that between September 2009 and June 2012 CBP agents made numerous seizures of counterfeit goods imported into the United States earmarked for shipment to Cipriano’s Rhode Island residence. After each seizure, seizure notices were sent notifying Cipriano of the seizure and provided the opportunity to contest the seizure. None were contested.
In October 2012, as a result of his arrest by federal agents for this crime, Cipriano was found to be a probation violator on a 2005 conviction in Rhode Island state court for conspiracy and receiving stolen property. Cipriano served 22 months in state prison on the violation while this matter was pending in federal court.
The case was prosecuted by Assistant U.S. Attorney Gerard B. Sullivan.
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[email protected]Portsmouth Man Sentenced for His Participation in Bank FraudRead the Press Release
NEWPORT NEWS, Va. – Dominique Avery, 20, of Portsmouth, Va., was sentenced today to eight-seven months in prison and ordered to pay in excess of $197,000 in restitution, for his participation in a conspiracy to commit bank fraud and aggravated identity theft.
Dana J. Boente, United States Attorney for the Eastern District of Virginia made the announcement after sentencing by United States District Judge Arenda Wright Allen.
According to court documents, Avery was involved in a yearlong conspiracy targeting at least five financial institutions, including ABNB Federal Credit Union and Navy Federal Credit Union, and over two dozen individuals and businesses. The defendant and others stole and/or purchased identities and applied for checking and savings accounts via online portals with minimal amounts. The conspirators then caused a third party check issuing service to send dozens of fraudulent checks to various vendors and individuals. Avery was arrested in August, 2012, while attempting to purchase two vehicles with fraudulent ABNB checks. The total intended losses exceed $737,000.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
This case was investigated by the United States Secret Service and the United States Postal Inspectors Service. Assistant United States Attorney Brian J. Samuels prosecuted the case on behalf of the United States.Pleasant Grove Woman Indicted for Filing False Tax ReturnsRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a four-count indictment yesterday against Jacquline Hoegel, 57, of Pleasant Grove, CA, charging her with making and subscribing false tax returns, United States Attorney Benjamin B. Wagner announced.
According to the indictment, Hoegel filed her personal income tax returns for the years 2005, 2006, 2007, and 2008 on the same day in September 2009. Those returns substantially understated her gross receipts and falsely stated that she was a graphic designer during the relevant tax years.
This case is the product of an investigation by the Internal Revenue Service-Criminal Investigations. Special Assistant United States Attorneys Benjamin Kingsley and Robin Harris are prosecuting the case.
The defendant, who is not in custody, is expected to appear on July 17, 2014, at 2:00 pm for her arraignment in federal court before Magistrate Judge Carolyn K. Delaney.
If convicted, Hoegel faces a maximum statutory penalty of up to three years in prison and a $100,000 fine on each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Pittsburg Resident Charged in Tax Fraud SchemeRead the Press Release
OAKLAND – Charles S. Moore, was charged with 17 counts of aiding and assisting in the preparation and filing of false tax returns, announced U.S. Attorney Melinda Haag and Internal Revenue Service, Criminal Investigation, Special Agent in Charge José M. Martinez.
According to the Indictment filed on Jan. 14, 2014, and unsealed today, between Feb. 5, 2011 and May 1, 2011, Moore willfully prepared and presented to the IRS, 17 tax returns, Forms 1040 EZ, for various taxpayers for the tax years 2007, 2008, 2009 and 2010. The tax returns were false and fraudulent with respect to the wages reported on each of the tax returns.
Moore, of Pittsburg, was arrested yesterday and made his initial appearance this morning before the Honorable Kandis A. Westmore, United States Magistrate Court Judge. Moore’s next court appearance is on July 18, 2014, at 9:30 a.m., before the Honorable Jon S. Tigar, District Court Judge in Oakland.
The maximum penalty for aiding and assisting in the preparation of false tax returns, in violation of Title 26, U.S.C § 7206(2) is three years in prison and a fine of $250,000.
Assistant U.S. Attorney Thomas Moore is prosecuting the case. The prosecution is the result of an investigation by the IRS, Criminal Investigation.
(Moore indictment )
Parker County, Texas, Man Pleads Guilty to Federal Kidnapping ChargeRead the Press Release
FORT WORTH, Texas — The Justice Department’s Civil Rights Division, the U.S. Attorney’s Office of the Northern District of Texas, and the FBI Dallas Division announced that Brice Johnson, 19, of Springtown, Texas, pleaded guilty today in federal court to kidnapping a young gay man after inviting the victim to his home and brutally assaulting him.
Johnson admitted in plea documents that in the early morning hours of Sept. 2, 2013, he connected with the adult male victim, identified as A.K., through the cell phone application for MeetMe.com. A.K.’s MeetMe.com page indicated he was a gay man, while Johnson’s web page indicated he was not gay. During their chat communications, Johnson said that he was interested in engaging in sexual activity with A.K. He invited A.K. to his home, gave A.K. his cell phone number and address, and they exchanged text messages planning their sexual encounter. Just a few minutes after A.K. arrived at the house, Johnson severely beat him and bound A.K.’s wrists with an electrical cord. Johnson then locked the victim into the trunk of his own car and drove the car to a family friend’s house. Individuals at the home repeatedly warned Johnson that they would call the police if he didn’t take A.K. to the hospital. Johnson eventually transported A.K. to an Emergency Medical Services (EMS) station in Springtown.
A.K. suffered multiple skull and facial fractures from the beating, causing him to be hospitalized for ten days at Harris Methodist Hospital in Fort Worth. Johnson admitted that he saved A.K.’s cell phone number using a gay slur as a contact name.
During the plea hearing this morning, before U.S. District Judge Reed C. O’Connor, Johnson admitted that he held and confined the victim against his will in order to conceal the violent assault and to remove A.K’s severely injured body from the home where Johnson was a long-term houseguest.
Sentencing has been set for Nov. 17, 2014. Johnson faces a maximum statutory penalty of up to life in prison and a $250,000 fine
“This was a senseless act of brutal violence that has no place in a civilized society,” said Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels. “We are hopeful that today’s guilty plea brings some sense of justice for the victim and makes clear that the Department of Justice is committed to using every tool available to vindicate the rights of victims of violent crimes. The department will continue to work with our state, local and federal law enforcement partners to vigorously investigate hate crimes allegations throughout the country.”
“Violent crimes of this nature will not be tolerated, and I commend the victim for his continued cooperation in the investigation and prosecution of this reprehensible conduct,” said U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
“The FBI is committed to thoroughly investigating violent crimes of this nature, and will continue to work with our local and state law enforcement partners to ensure justice for victims of these crimes,” said Diego Rodriguez, Special Agent in Charge of FBI Dallas Division.
The investigation is being conducted by the FBI, the Springtown Police Department and the Parker County Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Cara Foos Pierce and Trial Attorney Saeed Mody of the Civil Rights Division.
Park Heights Store Owner Sentenced to Prison for Food Stamp FraudRead the Press Release
Defendant Obtained Over $400,000 in Payments for Food Sales That Never Occurred
Baltimore, Maryland – U.S. District Judge George L. Russell, III sentenced Jung Kim, age 52, of Ellicott City, Maryland, to 20 months in prison followed by three years of supervised release, for food stamp and wire fraud in connection with a scheme to illegally redeem food stamp benefits in exchange for cash. Judge Russell also entered an order that Kim forfeit $95,453.50 and pay restitution of $205,000.The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William G. Squires, Jr. of the U.S. Department of Agriculture’s Office of Inspector General, Northeast Region; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
Jung Kim owned and operated C&C Market, a convenience store located at 4752 Park Heights Avenue in Baltimore. According to her plea agreement and court documents, the store participated in the Supplemental Nutrition Assistance Program (SNAP), previously known as the Food Stamp Program. In Maryland, the program provides eligible individuals with an electronic benefit transfer (EBT) card called the Independence Card, which operates like a debit card. Recipients obtain EBT cards through the state Department of Human Resources, then use the EBT card to purchase approved food items from participating retailers.
Jung Kim completed the required government form in January, 2005 to become an authorized retailer in the program. Kim received training and instruction regarding the requirements of the food stamp program, including that it was a violation of SNAP regulations to trade cash for SNAP benefits. Nevertheless, from November 2010 through April 2013, Kim routinely exchanged SNAP benefits for cash at less than face value of the EBT benefits, in violation of the food stamp program rules, and kept up to 50 percent of the benefits for herself.
As a result of these unlawful cash transactions, Kim obtained more than $400,000 in payments for food sales that never occurred.
Eight of the 10 convenience store owners or operators who were indicted in September 2013 in connection with schemes to illegally redeem food stamp benefits in exchange for cash have pleaded guilty to food stamp fraud and/or wire fraud. Ahmed Ayedh Al-Jabrati, age 58, a citizen of Yemen residing in Baltimore, was sentenced to two years in prison, and ordered to pay restitution of $1.2 million. Amara Cisse, age 50, of Windsor Mill, Maryland, was sentenced to 27 months in prison and ordered to pay restitution of $654,349.24, and his wife, Fanta Keita was sentenced to two months in prison. John Cunningham, age 55, of Baltimore, was sentenced to two years in prison. Retailer Hyung Cho, age 40, was sentenced to 38 months in prison, and his mother Dae Cho, age 67, was sentenced to 18 months in prison. The Chos were also ordered to forfeit $371,439.21 and pay restitution of $1.4 million. Two more retailers were indicted in January 2014.
United States Attorney Rod J. Rosenstein praised USDA’s Office of Inspector General and FBI for their work in the investigation. U.S. Attorney Rosenstein expressed appreciation to Secretary Ted Dallas and the Maryland Department of Human Resources, as well as U.S. Citizenship and Immigration Services - Office of Fraud Detection and National Security for their assistance in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Judson T. Mihok, Kathleen O. Gavin, and Leo J. Wise, who are prosecuting the cases.
Owners of Two Houston-Area Home Health Care Companies, Doctor, and Hospital Employee Sentenced for Their Roles in $3 Million Medicare Fraud SchemeRead the Press Release
Owners of two home health agencies, a doctor, and a hospital employee who sold patient information were all sentenced today for their roles in an $3 million Medicare fraud scheme.
Assistant Attorney General Leslie R. Cardwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson for the Southern District of Texas, Special Agent in Charge Stephen L. Morris of the FBI’s Houston Field Office, Special Agent in Charge Mike Fields of the Dallas Regional Office of HHS’s Office of the Inspector General (HHS-OIG), and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.
Valnita Turner, 48, Valdie Jackson, 43, Dr. Nick Patzakis, 86, and Jarvis Thomas, 40, were all sentenced today by U.S. District Judge Gray Miller in the Southern District of Texas.
On October 7, 2013, Valnita Turner, owner of Houston Compassionate Care, Inc., was convicted of one count of conspiracy to commit health care fraud and four counts of health care fraud. According to court documents, Turner and Valdie Jackson, owner of Jackson Home Healthcare, Inc., purchased stolen patient information from Jarvis Thomas, a hospital administrative employee. Turner and Jackson used the stolen patient information to submit fraudulent claims to Medicare for home health services purportedly provided by three home health agencies operating in the Houston area, Houston Compassionate Care, Inc., Jackson Home Healthcare, Inc., and Prestige Health Services, Inc.. Turner and Jackson also fraudulently billed Medicare for medically unnecessary home health services that were never ordered by a doctor and relied on doctors, including Dr. Nick Patzakis, to falsely sign medical documents.
Valnita Turner was sentenced to serve 151 months in prison. In addition to her prison term, Turner was sentenced to three years of supervised release and was ordered to pay $3,011,899.09 in restitution, jointly and severally with her co-defendants.
Valdie Jackson pleaded guilty to conspiracy to commit health care fraud on September 13, 2013. Jackson was sentenced to serve 12 months and one day in prison. In addition to his prison term, Jackson was sentenced to three years of supervised release and was ordered to pay $1,551,482.21 in restitution, jointly and severally with his co-defendants.
Dr. Nick Patzakis pleaded guilty to one count of false statements relating to health care matters on September 20, 2013. Dr. Patzakis was sentenced to time served and three years of supervised release. In addition, Dr. Patzakis was ordered to pay $95,947.57 in restitution, jointly and severally with his co-defendants.
Jarvis Thomas pleaded guilty to conspiracy to disclose individually identifiable health information on September 13, 2013. Thomas was sentenced to time served and three years of supervised release. Additionally, Thomas was ordered to pay $1,348,644.75 in restitution, jointly and severally with his co-defendants.
The case was prosecuted by Assistant Chief Robert Zink and Trial Attorneys Christopher Cestaro and Ashlee Caligone McFarlane of the Criminal Division’s Fraud Section. The case was investigated by the FBI, HHS-OIG and MFCU and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov .
Owner of Tampa Contracting Company Pleads Guilty to Paying Illegal Kickbacks for Fraudulent Training CertificatesRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III announces that Paul R. Pinet (67, Tampa) yesterday pleaded guilty to conspiracy to defraud the United States and to making false, fictitious, and fraudulent statements. Pinet faces a maximum penalty of five years in federal prison on the conspiracy charge. Barry Fitzgerald (62, Lakeland) pleaded guilty to the same charge in a related case on May 15, 2014.
According to the plea agreement, Pinet owned and operated Premier Corrosion Protection Services, Inc., a contracting company in Tampa that provided its contracting services to phosphate mines in Polk County and elsewhere. Fitzgerald was a Mine Safety and Health Administration (“MSHA”) approved safety instructor at a community college located in Polk County.
Federal law requires all miners, including those working in a surface mining operation, to receive training and instruction regarding various health and safety risks. New miners are required to take a 24-hour, newly-employed, inexperienced miner training course. Experienced miners are required to take an 8-hour refresher course each year. The training must be performed by an MSHA-approved training instructor and documented on MSHA Form 5000-23. Newly-employed inexperienced miner training is the mechanism by which miners receive their initial familiarization with the multitude of dangers inherent in the mining occupation, and their notification of their legal right to a safe working environment under the Mine Act.
From 2008 to at least July 2011, Pinet conspired with Fitzgerald and others to impede and impair MSHA’s administration and oversight of the Federal Mine Health and Safety Act and conspired to make false and fraudulent training certificates. As part of this conspiracy, Pinet purchased and caused the purchase of falsified training certificates (MSHA Forms 5000-23) from Fitzgerald for both the company’s new and experienced miners. The certificates were used by the company to make it appear as if its employees were properly trained, but in truth, Fitzgerald did not perform any MSHA training for the individuals named on the falsified certificates. Pinet obtained false and fraudulent training certificates in this manner for himself and other company employees. The company used these untrained workers to perform work at various phosphate mines in Polk County, including the Four Corners Mine.
In exchange for providing false and fraudulent training certificates, Pinet paid a kickback to Fitzgerald. The kickbacks were paid in cash or a check from the company made payable to cash. Pinet paid Fitzgerald $100 and later $125 per falsified training form. In addition to cash payments, Pinet caused at least $4,350 in checks to be paid to Fitzgerald between March 2009 and July 2011.
Joseph A. Main, Assistant Secretary of Labor for Mine Safety and Health, stated: "Miner training is a critical element in assuring a safe work place and preventing injuries, illnesses, and death. Those individuals who falsify miner training certificates put miners at risk and will be prosecuted to the full extent permitted by law."
This case was investigated by the Federal Bureau of Investigation and the United States Department of Labor, Mine Safety and Health Administration. It is being prosecuted by Assistant United States Attorney Matthew J. Mueller.
One Year After Supreme Court’s Historic Windsor Decision, Attorney General Holder Issues Report Outlining Obama Administration’s Work to Extend Federal Benefits to Same-sex Married CouplesRead the Press Release
Following the Supreme Court’s historic decision striking down Section 3 of the Defense of Marriage Act, Attorney General Eric Holder on Friday issued a formal report on the yearlong effort by the Justice Department and other federal agencies to implement the decision smoothly across the entire government.
“I am pleased to report that agencies across the federal government have implemented the Windsor decision to treat married same-sex couples the same as married opposite-sex couples for the benefits and obligations for which marriage is relevant, to the greatest extent possible under the law," Attorney General Holder wrote in the memorandum to President Obama. “The implementation of the Windsor decision across the entire federal government is an accomplishment that reflects countless hours of hard work, cooperation, and coordination across agencies. As additional issues arise, we will continue to work together to uphold this Administration’s fundamental commitment to equal treatment for all Americans, and to extend this fundamental equality to all Americans.”At the President’s direction last year, a team of lawyers—led by Assistant Attorney General for the Civil Division Stuart Delery—began working with lawyers for other federal agencies to seek to extend federal benefits to same-sex marries couples, consistent with the Windsor decision. The department and the agencies have made many announcements on a rolling basis over the last several months. To date, for instance, the administration has announced that same-sex marriages will be recognized for all federal tax purposes, that health insurance and retirement benefits are available for same-sex spouses of all federal employees, and that the Defense Department will provide spousal benefits for same-sex spouses of military servicemembers.
In conferring these and other benefits, agencies have chosen to recognize marriages as valid based on the law of the jurisdiction where the marriage took place (the place of celebration), regardless of where the couple currently resides. As noted in the Attorney General’s report, however, two agencies—the Social Security Administration and Department of Veterans Affairs (VA)—are prohibited by federal statute from adopting a “place of celebration” rule for certain programs of critical importance to millions of Americans. The administration looks forward to working with Congress to fix these parts of the law to ensure that Americans who rely on these programs can obtain these essential benefits no matter where they live.
In the meantime, both the VA and Social Security Administration have sought to extend benefits to the absolute maximum extent, seeking out all legally available authority. As a result, for instance, the administration is able to announce today that the VA Acting Secretary has determined that he will exercise his broad statutory discretion in the area of burial benefits to designate any individual in a committed relationship for burial in a national cemetery, which will allow for the inclusion of same-sex spouses where the domicile provision would otherwise govern. In addition, SSA will extend survivor benefits, lump sum death benefits and aged spouse benefits to same-sex couples if one partner could inherit from the other partner on the same terms as a spouse under state law. This expands the number of states in which these benefits can be extended.
A full copy of the Attorney General’s report to the President is attached.
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Old Orchard Beach Man Pleads Guilty to Pharmacy RobberyRead the Press Release
Contact: Michael J. Conley
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced that Kyle
Desmarais, 33, of Old Orchard Beach, Maine, pled guilty today in U.S. District Court before
Judge Nancy Torresen to aiding and abetting pharmacy robbery.According to court records and evidence introduced at the plea hearing, on February 13, 2014, Desmarais drove Billy Schildroth to a Rite Aid pharmacy located in Old Orchard Beach, so that Schildroth could rob the pharmacy. Schildroth absconded with Oxycontin (oxycodone) and Suboxone (buprenorphine) after putting his hand inside his coat and telling the pharmacist that he had “a gun and five bullets” and not to alert anyone or he would shoot the pharmacist in the face. After the robbery, Desmarais drove Schildroth away knowing that he had committed the robbery.
On June 3, 2014, Schildroth was indicted for the pharmacy robbery and awaits trial. An indictment is merely an accusation and a defendant is presumed to be innocent unless proven guilty in a court of law.
Desmarais faces up to 20 years in prison and a $250,000 fine. He will be sentenced after completion of a presentence investigation report by the U.S. Probation Office.The investigation was conducted by the Federal Bureau of Investigation and the Old
Orchard Beach Police Department.O.C. Man Convicted in Scams That Caused over $3 Million in Losses with False Promises of Products That Treated Common AilmentsRead the Press Release
SANTA ANA, California – An Irvine man was found guilty today of running a fraud scheme that raised about $3.3 million from victims who thought they were investing in products that would treat childhood obesity and Type II diabetes.
Charles “Chuck” Davis, 57, was found guilty today of two counts of mail fraud, seven counts of wire fraud and four counts of money laundering
The evidence presented during a seven-day trial showed that Davis operated an investment scam involving the Newport Beach-based LifeRight Holdings, Inc. According to promises made by Davis, LifeRight was going to develop and use infomercials to market a product to combat child obesity. Davis promised investors a 15 percent return in only 13 months, as well as royalties on products sold and an option to convert the investment into shares of LifeRight stock when the company began selling product.
But investor funds – more than $2.4 million raised from about 40 victims in 2007 and 2008 – were actually used to fund Davis’ personal expenses and legal fees in lawsuits brought against him.
The second scheme involved a company called DT2, which purportedly offered a product to treat Type II diabetes. From 2009 to 2011, Davis raised more than $900,000 from about 25 DT2 investors. Similar to the LifeRight scam, Davis diverted the investor funds to other companies and, instead of spending the money on DT2 business, Davis used the money to pay for high-end restaurants, expenses sustained by several girlfriends, spa treatments, cash withdrawals, and his civil and criminal defense attorneys.
As a result of being convicted of the 13 felony counts, Davis faces a statutory maximum sentence of 240 years in federal prison when he is sentenced by United States District Judge Andrew Guilford on October 20.
Davis has been in custody since September 2011.
The case against Davis was investigated by the Federal Bureau of Investigation.
Release No. 14-078
New Haven Man Sentenced to 14 Years in Federal Prison for Distributing Cocaine, Crack Cocaine and OxycodoneRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that MICHAEL THOMPSON, 35, of New Haven, was sentenced yesterday by Senior U.S. District Judge Ellen Bree Burns in New Haven to 168 months of imprisonment, followed by five years of supervised release, for distributing cocaine, crack cocaine and oxycodone.
THOMPSON is one of more than 100 individuals charged as a result of “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven. Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms.
On December 6, 2013, a jury found THOMPSON guilty of one count of conspiracy to possess with intent to distribute, and to distribute, five kilograms or more of cocaine, 280 grams or more of cocaine base (“crack cocaine”), and a quantity of oxycodone.
According to the evidence at trial, THOMPSON received kilogram quantities of cocaine from suppliers, including co-defendant Christopher “White Boy Chris” Morley, which THOMPSON converted into crack cocaine and then sold to other narcotics distributors and customers. Morley also provided THOMPSON with quantities of oxycodone, which THOMPSON redistributed to others. At times, THOMPSON supplied powder cocaine to Morley.
THOMPSON’s criminal history includes at least nine prior felony convictions.
Morley pleaded guilty and awaits sentencing.
This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments have provided valuable assistance to the investigation.
This case is being prosecuted by Assistant United States Attorneys S. Dave Vatti and Marc Silverman.
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U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]New Benefit Fraud Arrests in Sutter CountyRead the Press Release
YUBA CITY, Calif. — An ongoing investigation into an unemployment and disability benefits fraud scheme has led to the indictment and arrest of four Sutter County residents for their participation in the scheme and a superseding indictment bringing additional charges against others previously named as defendants, announced United States Attorney Benjamin B. Wagner, U.S. Department of Labor, Office of Inspector General Special Agent in Charge Abel Salinas, FBI Special Agent in Charge Monica M. Miller, and Employment Development Department Investigation Division Chief Lisa Schmith.
The Sutter County-based scheme used farm labor contracting companies to sell false paystubs that indicated the purchasers had been employed by the companies when it fact they had not. These fraudulent paystubs enabled the purchasers to apply for unemployment and disability benefits to which they were not entitled. The fraud scheme is alleged to have defrauded the California Employment Development Department of more than $14 million.
The federal grand jury returned a superseding indictment yesterday that expands the original charges brought in 2012 against six defendants. The grand jury also returned a new indictment charging one of those defendants and another man with starting a new scheme to sell false wages. Two new defendants were also charged in that indictment with committing perjury before the investigating federal grand jury.
The superseding indictment charges that Mohammad Nawaz Khan, 56; Mohammad Adnan Khan, 31; Iqila Begum Khan, 31, all of Live Oak; and Mohammad Shahbaz Khan 56, of Yuba City, controlled a series of companies that were reported to the Employment Development Department as farm labor contractors. The Khans, together with Gurdev Kaur Johl, 69, and Kewal Singh, 76, both of Yuba City, who were also charged, sold fake paystubs to other people in the community and used the companies they controlled to report false wages for the individuals who purchased those paystubs. According to the superseding indictment, the Khans at times instructed the purchasers how the fake paystubs could be used to fraudulently claim unemployment and disability benefits. Over the course of the conspiracy, which allegedly began in the early 1990s, the defendants reported false wages for more than 1,000 separate individuals that resulted in more than 2,000 fraudulent claims for unemployment and disability benefits.
The new indictment charges that while out on bond for the first indictment, Mohammad Shahbaz Khan began a new conspiracy with Mohammad Riaz Khan, aka Ray Khan, 53, of Live Oak, to commit unemployment and disability fraud. It is alleged in the indictment that Mohammad Riaz Khan issued checks to his supposed employees and directed those individuals to cash the checks and return the money to him in order to make it appear that the individuals were actually being paid wages by Mohammad Riaz Khan. Also in that indictment, Harmit Chechi, 27, of Yuba City, and Harjit Johal, 47, of Yuba City, are charged with committing perjury before a federal grand jury in connection with that investigation. Mohammad Riaz Khan, Mohammad Shahbaz Khan, Chechi, and Johal were arrested this morning.
“The indictments returned yesterday allege that the defendants ran a scheme that ripped off the Employment Development Department for many years,” said U.S. Attorney Wagner. “Those responsible for this scheme are likely to end up in prison, and those who purchased false wages from them should come clean rather than try to conceal the scheme. Today, two people were arrested on charges of lying to the grand jury, and more people are under investigation for perjury. Obstructing a federal fraud investigation is unacceptable, and those who engage in such conduct will face the full weight of federal law enforcement.”
“Despite indictments of more than 20 individuals in 2012 and 2013, allegations of continued criminal activity persisted,” said Monica M. Miller, Special Agent in Charge of the Sacramento division of the FBI. "Continued, open contribution among EDD, DOL-OIG, and the U.S. Attorney’s office ensured a thorough and successful investigation, and we are thankful for the opportunity to work together to protect the integrity of government at all levels.”
“Any fraud against the employer-funded Unemployment Insurance Program or the employee-funded Disability Insurance Program is unacceptable,” said Patrick W. Henning, Jr., Director of the California Employment Development Department (EDD). “The EDD is committed to protecting these vital programs and working with our law enforcement partners to prosecute offenders to the fullest extent of the law. And we will soon become only the second state in the nation to employ the latest in technology and predictive analysis tools to identify new fraud trends and prevent benefit fraud.”
This latest indictment brings the total to 28 individuals who have been charged in this investigation. Thirteen have pleaded guilty to various charges. A status conference as to Mohammad Nawaz Khan et al. is schedule for June 26, 2014 at 9:00 a.m. before Chief U.S. District Judge Morrison C. England Jr. A jury trial is scheduled for January 12, 2015.
This case was the product of an investigation by the U.S. Department of Labor, Office of Inspector General; the Federal Bureau of Investigation; and the Employment Development Department-Criminal Investigations. Assistant United States Attorneys Jared C. Dolan and Sherry D. Hartel Haus are prosecuting the cases.
If convicted, each defendant faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for each count. Chechi and Johal face a maximum statutory penalty of five years in prison for perjury. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges in the indictments are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Monroe Man Pleads Guilty to Fraud and Tax OffensesRead the Press Release
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The United States Attorney for the District of Connecticut announced that ANTHONY TESTO, 66, of Monroe, pleaded guilty today before U.S. Magistrate Judge Donna F. Martinez in Hartford to fraud and tax charges stemming from a scheme to defraud a Bridgeport-based residential property owner. TESTO, the owner and president of ACT Builders, Inc., also entered a plea of guilty on behalf of his company.
According to court documents and statements made in court, ACT Builders, Inc. was contracted to serve as a property manager for an entity in Bridgeport that owned an apartment complex and several single and multi-family residences. TESTO’s role as property manager included filling vacant rental units, setting rental amounts, collecting security deposits, collecting rent from tenants and depositing rental payments in the property owner’s bank account. TESTO also was required to submit to the property owner a monthly “rent roll,” which was a spreadsheet showing the occupancy of the rental units, the rental amounts due and the rental payments collected from tenants.
From approximately January 2007 to August 2010, TESTO, ACT Builders and others schemed to defraud the property owner by submitting fraudulent rent rolls that misrepresented that certain rental units were vacant with no rent due when, in fact, the apartments were occupied and rent had been collected. The rent rolls also misrepresented that the rent due and collected for certain rental units was lower than the amount that was actually collected. TESTO deposited rental income that was due to the property owner into both his personal bank account and the ACT Builders bank account.
TESTO, who hired subcontractors to provide maintenance services for the property, also submitted fraudulent subcontractor invoices to the property owner.
TESTO defrauded the property owner of at least $275,000 through this scheme. He also failed to report this fraudulent income on his 2007 through 2010 personal federal income tax returns, resulting in a tax loss to the Internal Revenue Service of $71,795.
TESTO pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum term of imprisonment of 20 years, and one count of assisting in the preparation and filing of a false tax return, which carries a maximum term of imprisonment of three years. Act Builders pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum term of probation of five years.
TESTO has agreed to pay full restitution to the victim property owner, as well as back taxes, plus penalties and interest.
TESTO and Act Builders are scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on September 2, 2014.
TESTO was arrested on March 13, 2014 and is currently released on a $500,000 bond.
This matter is being investigated by the Federal Bureau of Investigation, and the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Felice Duffy.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Long Time Fugitive Arrested for Identity TheftRead the Press Release
United States Attorney Karen L. Loeffler, announced the arrest of Joseph Keenan May, 60, on identity theft charges. May, of Eagle River and Houston, Alaska, has been wanted for capital sexual battery in Brandenton, Florida, since 1991. He has been the subject of a federal warrant charging unlawful flight to avoid prosecution since 1993. According to the indictment, May has been living under the identity of a stepbrother, Michael Camp, who died in his teens in the 1970s in Pennsylvania. May is a former deputy sheriff in Manatee County, Florida. The indictment charges two counts of unlawful use of a social security number, stemming from May’s use of Camp’s name and number to apply for an Alaska driver’s license in 2009 and unemployment benefits in 2013. He is also charged with aggravated identity theft. May faces up to 12 years in prison on the federal charges in Alaska. He potentially faces the death penalty in Florida.
May was arrested by an FBI tactical team at a home in Eagle River in the early morning hours of Friday, June 20. May will be arraigned before a federal judge in Anchorage at 2:30 p.m. on Friday.
Ms. Loeffler commends the efforts of the Social Security Administration, Office of the Inspector General, and the Federal Bureau of Investigation (FBI), Anchorage Division for conducting the investigation that led to the Alaska indictment and arrest. Thanks are also due to the FBI Tampa Division, the United States Attorney’s Office for the Middle District of Florida, the State’s Attorney’s Office in Brandenton, Florida, and the Manatee County Sheriff’s Office.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Lincoln Man Sentenced for Receipt of Child PornographyRead the Press Release
United States Attorney Deborah R. Gilg announced that Michael L. Nguyen, 27, of Lincoln, Nebraska, was sentenced on June 20, in Lincoln, Nebraska, to five years in prison by United States District Judge Joseph F. Bataillon for receipt of child pornography. After his release from prison, Nguyen will be required to serve a 5 year term of supervised release and be registered as a sex offender. Additionally, Nguyen is ordered to pay a total of $6,000 in restitution, to be divided among victims whose images were included in the numerous files located on Nguyen’s computers.
On February 12, 2013, an investigator was investigating computers sharing child pornography on the Internet. An IP address registered to Nguyen was identified as having files in violation of state and local law. Between February 12, 2013 and February 25, 2013, an investigator was able to make a direct connection to a computer at Nguyen's IP address and downloaded 5 five videos depicting sexually explicit conduct involving children under the age of 18 years old. On February 22, 2013, members of the Lincoln Police Department and Lancaster County Sheriff's Office executed a search warrant at Nguyen’s residence. Nguyen was contacted during the warrant and did admit that he downloaded and used file sharing software on his laptop. Investigators conducted a forensic preview of Nguyen's laptop computer and found numerous videos and images depicting sexually explicit conduct involving children under the age of 18 years old.
Forensic analysis of the company laptop computer used by Nguyen revealed over 2,339 images, including over 200 videos of child pornography.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Lincoln Police Department.
Lexington Man Found Guilty of Receiving and Possessing Thousands of Child Pornography ImagesRead the Press Release
Defendant possessed 4,000 videos of child pornography
LEXINGTON, KY - A federal jury has found a Lexington man guilty of receiving and possessing thousands of child pornography images.
On Wednesday night, following three days of trial and four hours of deliberation, the jury convicted Erik A. Hentzen, 26, of the charges.
The evidence at trial established that, from May 2012 to March 2013, Hentzen downloaded thousands of videos, which depicted prepubescent children engaged in sexually explicit conduct.
On March 23, 2013, investigators with the Kentucky Attorney General’s Office executed a search warrant and seized multiple computers belonging to Hentzen; the computers contained more than 4,000 videos depicting child pornography.
The investigation began when authorities discovered that numerous child pornography videos had been made available for download over the internet. Investigators then traced the location of the computer to Hentzen’s apartment in downtown Lexington.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Jack Conway, Kentucky Attorney General; and Gary J. Hartwig, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), jointly announced the conviction.
The investigation was conducted by the Office of the Attorney General’s Cyber Crimes Unit and HSI. The Fort Mitchell Branch of the U.S. Attorney’s Office prosecuted the case on behalf of the federal government.
Hentzen is scheduled to be sentenced on September 15, 2014. Each of the charges he was convicted of carries a maximum term of 20 years in prison. However, the Court must consider the U.S. Sentencing Guidelines and the federal statutes before imposing the sentence.
Lawrence Man Pleads Guilty to Federal Marijuana Trafficking ChargeRead the Press Release
TOPEKA, KAN. – A Lawrence man pleaded guilty Friday to a federal marijuana trafficking charge, U.S. Attorney Barry Grissom said.
Michael D. Landsness, 27, Lawrence, Kan., pleaded guilty to two counts of possession with intent to distribute marijuana. In court papers, Landsness admitted he was one of the distributors for a marijuana trafficking organization in Lawrence. The organization was the target of a federal investigation that began in November 2012. Over the course of the investigation, law enforcement seized about 44 pounds of marijuana and more than $193,000 in cash from the traffickers.
On April 3, 2013, investigators working undercover arranged to buy a pound of marijuana from Landsness for $3,000. The next day, officers stopped Landsness and found half a pound of marijuana in his car.
Sentencing is set for Sept. 12. He faces a maximum penalty of five years in federal prison and a fine up to $250,000 on each count.
Charged as co-conspirators are: Benjamin Johnson, 33, Lawrence, who is set for trial Sept. 9.
Dominick A. Howard, 20, Lawrence, Kan., who is awaiting trial.
Senator J. Christopher Hood, 26, Lawrence, who is set for jury trial Aug. 19.Grissom commended the Lawrence Police Department and Assistant U.S. Attorney Greg Hough for their work on the case.
Lakeland Mail Carrier Arrested for Theft of Mail and Treasury ChecksRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces the arrest of Franklin C. Barnes (48, Winter Haven) on a federal complaint charging him with theft of mail and government property in the form of U.S. Treasury checks. Barnes made his initial appearance before U.S. Magistrate Judge Thomas G. Wilson today, in Tampa, and was released on a $25,000 personal surety bond.
According to the complaint, Barnes stole at least three U.S. Treasury checks from the mail that were addressed to an address on his postal route, and sold them to an undercover law enforcement agent.
A criminal complaint is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was part of an ongoing joint investigative effort by the United States Postal Inspection Service and the United States Postal Service – Office of Inspector General, Internal Revenue Service – Criminal Investigations, Federal Bureau of Investigation, Florida Department of Law Enforcement, and the Lakeland Police Department. It will be prosecuted by Assistant United States Attorney Kelley Howard-Allen.
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Jury Convicts Irondequoit Man of Production of Child PornographyRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Michael D. Schluter, 45, formerly of Irondequoit, N.Y., was convicted after a jury trial of production of child pornography, possession of child pornography, and transporting a minor across state lines with the intent to engage in illegal sexual activity. The charges carry a mandatory minimum penalty of 15 years in prison, a maximum of 30 years, and a $250,000 fine.
“Thanks to the jury’s verdict in this case, this defendant will now serve a lengthy sentence for his despicable actions,” said U.S. Attorney Hochul. “The defendant, who sought to take away the innocence of a child, instead succeeded only in losing his own freedom – if not forever, then certainly for a very long period of time.”
Assistant U.S. Attorneys Tiffany H. Lee and Craig R. Gestring, who handled the prosecution of the case, stated that in January 2009, a minor reported that she had been sexually abused by the defendant. The Government’s trial evidence established that in July 2008 Schluter took photographs of the minor in sexually explicit poses. Further, the Government proved that in 2007, the defendant transported the minor to Massachusetts and Vermont in 2007 for the purpose of raping the minor.The conviction is the culmination of an investigation on the part of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero and the Irondequoit Police Department, under the direction of Chief Richard V. Tantalo.
Sentencing is scheduled for September 17, 2014, at 3:30 p.m. before U.S. District Judge Frank P. Geraci, Jr.Joint Statement from the Office of the Director of National Intelligence and the Department of Justice on the Declassification of Renewal of Collection Under Section 501 of the Foreign Intelligence Surveillance ActRead the Press Release
The Justice Department and the Office of the Director of National Intelligence released the following joint statement Friday: Earlier this year in a speech at the Department of Justice, President Obama announced a transition that would end the Section 215 bulk telephony metadata program as it previously existed, and that the government would establish a mechanism that preserves the capabilities we need without the government holding this bulk data. As a first step in that transition, the President directed the Attorney General to work with the Foreign Intelligence Surveillance Court (FISC) to ensure that, absent a true emergency, the telephony metadata can only be queried after a judicial finding that there is a reasonable, articulable suspicion that the selection term is associated with an approved international terrorist organization. The President also directed that the query results must be limited to metadata within two hops of the selection term instead of three. These two changes were put into effect in February 2014. In addition to directing those immediate changes to the program, the President also directed the Intelligence Community and the Attorney General to develop options for a new approach to match the capabilities and fill gaps that the Section 215 program was designed to address without the government holding this metadata. After carefully considering the available options, the President announced in March that the best path forward is that the government should not collect or hold this data in bulk, and that it remain at the telephone companies with a legal mechanism in place which would allow the government to obtain data pursuant to individual orders from the FISC approving the use of specific numbers for such queries. The President also noted that legislation would be required to implement this option and called on Congress to enact this important change to the Foreign Intelligence Surveillance Act (FISA).
Consistent with the President’s March proposal, in May, the House of Representatives passed H.R. 3361, the USA FREEDOM Act, which would, if enacted, create a new mechanism for the government to obtain this telephony metadata pursuant to individual orders from the FISC, rather than in bulk. The bill also prohibits bulk collection through the use of Section 215, FISA pen registers and trap and trace devices, and National Security Letters. Overall, the bill’s significant reforms would provide the public greater confidence in our programs and the checks and balances in the system, while ensuring our intelligence and law enforcement professionals have the authorities they need to protect the Nation. The Administration strongly supports the USA FREEDOM Act. We urge the Senate to swiftly consider it, and remain ready to work with Congress to clarify that the bill prohibits bulk collection as noted above, as necessary.
Given that legislation has not yet been enacted, and given the importance of maintaining the capabilities of the Section 215 telephony metadata program, the government has sought a 90-day reauthorization of the existing program, as modified by the changes the President announced earlier this year. Consistent with prior declassification decisions, in light of the significant and continuing public interest in the telephony metadata collection program, the Director of National Intelligence, James Clapper, has declassified the fact that the government’s application to renew the program was approved yesterday by the FISC . The order issued yesterday expires on Sept. 12, 2014. The Administration is undertaking a declassification review of this most recent court order and an accompanying memorandum opinion for publication.Jewelry Store Owner Admits Role in International, $200 Million Credit Card Fraud SchemeRead the Press Release
TRENTON, N.J. – A New Jersey jewelry store owner who used his business to further one of the largest credit card fraud schemes ever charged by the Justice Department today became the 18th conspirator to admit his role in the scheme, U.S. Attorney Paul J. Fishman announced.
Vijay Verma, 46, of Iselin, N.J., pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court to an information charging him with one count of access device fraud.
According to documents filed in this case and statements made in court:Verma was indicted in October 2013 as part of a scheme to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. Participants in the scheme doctored credit reports to pump up the spending and borrowing power associated with the cards. They then borrowed or spent as much as they could, based on the phony credit history, but did not repay the debts – causing more than $200 million in confirmed losses to businesses and financial institutions. These debts were incurred at Verma’s jewelry store, among many other locations, where Verma would allow fraudulently obtained credit cards to be swiped in phony transactions.
The scheme involved a three-step process in which the defendants would make up a false identity by creating fraudulent identification documents and a fraudulent credit profile with the major credit bureaus; pump up the credit of the false identity by providing false information about that identity’s creditworthiness to those credit bureaus; then run up large charges.
The scope of the criminal fraud enterprise required other scheme participants to construct an elaborate network of false identities. Across the country, they maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes, which they used as the mailing addresses for the false identities.
Verma admitted he allowed others who came to his Jersey City, N.J., store to swipe cards he knew did not legitimately belong to them. Verma would then split the proceeds of the phony transactions with these other conspirators.
The count to which Verma pleaded guilty carries a maximum potential penalty of 15 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for Sept. 25, 2014.
U.S. Attorney Fishman credited special agents of the FBI’s Cyber Division, under the direction of Special Agent in Charge Aaron T. Ford; postal inspectors from the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge Maria L. Kelokates; and special agents of the U.S. Secret Service, under the direction of Special Agent in Charge James Mottola, with the investigation leading to today’s guilty plea. He also thanked the U.S. Social Security Administration Office of Inspector General, Office of Investigations in New Jersey for assisting in the investigation.The government is represented by Assistant U.S. Attorneys Zach Intrater and Daniel V. Shapiro of the U.S. Attorney’s Office Economic Crimes Unit and Barbara Ward of the office’s Asset Forfeiture Unit in Newark.
This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
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Defense counsel: Gerald Krovatin Esq., NewarkVerma, Vijay Information
Jemez Pueblo Man Pleads Guilty to Federal Child Sexual Abuse ChargeRead the Press Release
ALBUQUERQUE – Irving Shendo, 59, a member of the Jemez Pueblo, pleaded guilty this morning to a felony information charging him with aggravated sexual abuse of a child. Under the terms of his plea agreement, Shendo will be sentenced to eight years in federal prison followed by a term of supervised release to be determined by the court. Shendo also will be required to register as a sex offender.
Shendo was arrested in July 2013, based on a criminal complaint alleging that he engaged in a sexual act with a Jemez Pueblo child under the age of 12 years. According to court filings, Shendo sexually abused the child victim in August 2008 in a residence located on Jemez Pueblo, N.M., but his criminal conduct was first reported to law enforcement authorities in April 2013.
During today’s change of plea hearing, Shendo admitted that on Aug. 1, 2008, he engaged in a sexual act with the child victim. He further acknowledged committing the crime in Jemez Pueblo.
Shendo has been in federal custody since his arrest. He remains detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI, the Jemez Pueblo Tribal Police Department and the Albuquerque Police Department. The case is being prosecuted by Assistant U.S. Attorney Presiliano A. Torrez as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
James Allen Hicks Sentenced to 97 Months in Prison for Receiving and Possessing Child PornographyRead the Press Release
KNOXVILLE, Tenn. -- James Allen Hicks, 37, of Knoxville, Tenn., was sentenced to serve 97 months in prison by the Honorable Harry S. Mattice, Jr., U.S. District Judge for the Eastern District of Tennessee. The sentence was the result of a guilty plea entered by Hicks in February 2014 to a federal indictment charging him with distributing and possessing child pornography. A forensic examination of Hicks’s computer revealed that he possessed approximately 576 images of child pornography.
As part of the sentence imposed, upon his release from prison Hicks will be on supervised release for a period of five years and for the rest of his life will be required to register as a sex offender wherever he lives, works, or attends school.
U.S. Attorney William C. Killian emphasized the importance of the prosecution of child pornographers. “People who trade child pornography fuel the further exploitation of children. This sentence sends a strong message to those who would prey upon the youngest and most vulnerable members of society that trafficking in images of the exploitation of children will not be tolerated,” said Killian.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
International Distributor Pleads Guilty and Is Sentenced for Illegal Sale and Distribution of Refrigeration Equipment Containing Ozone Depleting SubstancesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Maureen O’Mara, Special Agent in Charge, United States Environmental Protection Agency (EPA), Criminal Investigation Division, Atlanta Area Office, and Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), announce that eAir, LLC (eAir), a Florida corporation with its headquarters in Miami, was convicted and sentenced in federal court in Miami in connection with the illegal sale and distribution of refrigeration equipment that contained restricted ozone depleting substances, in violation of the federal Clean Air Act, Title 42, United States Code, Sections 7413(c) and 7671.
eAir pled guilty to a one count information filed against it before U.S. District Court Judge Cecilia Altonaga, for knowingly violating a requirement and rule relating to stratospheric ozone protection through the sale and distribution in interstate commerce of a product manufactured on or after January 1, 2010 containing the refrigerant gas, hydrochlorofluorocarbon-22 (HCFC-22). HCFC-22 is a widely used refrigerant for residential heat pump and air-conditioning systems.
Immediately following the guilty plea, eAir was sentenced to five years of probation and ordered to pay a $200,000.00 criminal fine. In addition, as a special condition of probation, eAir was ordered to implement and enforce a comprehensive Environmental Compliance Plan, to pay community service in the amount of $75,000.00, and to reimburse the U.S. Customs and Border Protection (CBP) for costs incurred in storing illegal merchandise.
Federal law prohibits the sale and distribution of refrigeration components manufactured after January 1, 2010 that contain or are “pre-charged” with HCFC-22. The federal Clean Air Act regulates air pollutants including ozone depleting substances such as HCFC-22. The Clean Air Act and its implementing regulations established a schedule to phase out the production and importation, as well as establish limitations on the sale and distribution of equipment containing Class II ozone depleting substances not otherwise subject to the bulk importation allowance system.
According to court records, eAir is in the business of importing and distributing merchandise, including air conditioning equipment, condensers, and mini-split air conditioning units. CBP records revealed thirty-four consumption entries filed on behalf of eAir for equipment that contained prohibited HCFC-22. eAir, with knowledge of the January 1, 2010 ban against the sale and distribution of such equipment, had the merchandise manufactured by an affiliated company in China between approximately February and July 2010. eAir subsequently executed more than 100 separate invoices for the sale of approximately 5,033 units or components containing HCFC-22 in direct violation of the Clean Air Act.
This matter and others involving the smuggling and distribution of ozone-depleting substances are being investigated through a multi-agency initiative known as Operation Catch-22. Operation Catch-22 has, to date, included the successful conviction of nearly a dozen individuals and corporations at every level of the refrigerant gas smuggling and distribution chain.
Mr. Ferrer commended the investigative efforts of the EPA, ICE-HSI, the Florida Department of Environmental Protection, Criminal Investigation Bureau, and the Miami-Dade Police Department. The case was prosecuted by Special Assistant U.S. Attorney Jodi A. Mazer and Assistant U.S. Attorney Thomas Watts-FitzGerald.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Illegal Backcountry Outfitter Sentenced for Operating Without A Special Use Permit on National Forest System LandsRead the Press Release
DENVER – Chris Burandt of Kremmling, Colorado, was fined $1,000, assessed $5,000 in restitution and sentenced to 10 hours of community service as well as two years’ probation for operating an illegal snowmobile outfitting guide service since 2007 on multiple national forests in Colorado. Burandt plead guilty yesterday to selling or offering for sale any merchandise or conducting any kind of work activity or service unless authorized by Federal law, regulation, or special use authorization.
In January 2010, Burandt was issued a violation notice by the U.S. Forest Service for guiding a snowmobile trip. In February 2011 while guiding another snowmobile trip with paying clients, Burandt was contacted by U.S. Forest Service law enforcement officers. Subsequently, Burandt was charged by the U.S. Forest Service through the U.S. Attorney’s Office for conducting any kind of work activity or service unless authorized by Federal law, regulation, or special use authorization.
“The U.S. Forest Service works hard to protect our natural resources so that everyone is able to enjoy them,” said U.S. Attorney John Walsh. “When someone makes a living using Forest Service land without the proper permit that person should know there are criminal consequences for that conduct.”
“Outfitter and guiding without a special use permit is a serious offense. Clients assume when they pay for a guiding service that outfitters are carrying insurance and operating legally. The U.S. Forest Service requires outfitters and guides to operate under a special permit so that the safety of visitors and the protection of national forest resources is ensured,” said Laura Mark, Special Agent in Charge for the Rocky Mountain Region of the U.S. Forest Service.
The U.S. Forest Service requires special use permits to conduct work, or commercial activities on national forest system lands. Outfitting and guiding operations such as snowmobile outfitting on national forest system lands is a competitive and profitable so the U.S. Forest Service strictly regulates operations to provide safe conditions for the public and to conserve natural resources. Permitted outfitters are authorized to conduct business in specific areas on national forests, operate with an approved business plan, and show proof of liability insurance.
This matter was investigated by the U.S. Forest Service Rocky Mountain Region and prosecuted Assistant U.S. Attorney Michelle Heldmyer.
Idaho Executive Involved in Advance Fee Scheme Pleads GuiltyRead the Press Release
BOSTON – An Idaho business executive pleaded guilty to wire fraud conspiracy in connection with a scheme to steal deposits from individuals seeking financing.
Lucas Ford, 37 of Post Falls, Idaho, pleaded guilty before U.S. District Court Chief Judge Patti B. Saris. Ford is scheduled to be sentenced on Nov.10, 2014.
Ford was chief operating officer of an entity known as Quest Capital Finance which falsely represented to be a financing company that could provide hundreds of millions of dollars in loans. From 2008 through 2012, Ford and his co-conspirator, another Quest executive, told prospective borrowers that they needed to make up-front payments of several hundred thousand dollars into a refundable escrow account as deposits towards future loans. The escrow agreements falsely represented that the funds would not be moved out of escrow unless and until all contingencies for the loans had been met and the loans were being funded. In fact, shortly after the prospective borrowers deposited the money, the conspirators routinely took all or most of the escrowed money and transferred it to Quest. They then transferred the funds to other business and personal accounts, without ever arranging the promised financing for the borrowers. The conspirators, and others, continued to promise the prospective borrowers that Quest would soon be providing millions of dollars of financing; however, Quest did not provide the financing nor did it refund any of the deposits.
Ford faces a maximum statutory sentence of five years in prison, three years of supervised release and a fine of $250,000 or twice the gross loss or gross gain from the scheme, whichever is greater.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Shelly Binkowski, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. The case is being prosecuted by Sara Miron Bloom of Ortiz’s Economic Crimes Unit.
Guilty Plea in $2.9 Million Stolen Identity Tax ScamRead the Press Release
Grand Rapids businessman admits forging endorsements on $750,000 of US Treasury Checks
GRAND RAPIDS, MICHIGAN – Mateo Velasquez-Garcia, of Grand Rapids, Michigan, pled guilty to one count of Forgery of U.S. Treasury Checks and one count of Illegal Re-entry by an Alien, U.S. Attorney Patrick A. Miles, Jr. announced today. Velasquez-Garcia operated a grocery store located at 1814 S. Division Avenue, Grand Rapids, Michigan. An investigation revealed that $2.9 million dollars’ worth of fraudulently obtained federal tax refund checks were deposited into the bank account for the Tienda La Nueva Esperanza grocery store during the years 2011 to 2012. Velasquez-Garcia admitted to federal agents that he personally placed false endorsements on the back of 115 of the United States Treasury checks, which were payable to third parties. U.S. Attorney Miles was joined in the announcement by Acting Special Agent in Charge Carolyn Weber, Internal Revenue Service Criminal Investigation and Special Agent in Charge Marlon V. Miller of Homeland Security.
Velasquez-Garcia is also an alien. He was previously removed from the U.S. and has been found to be in the U.S. without the proper consent of the Attorney General or the Secretary of Homeland Security.
The maximum penalty for forging U.S. Treasury checks is imprisonment of not more than ten years and a $250,000 fine. The maximum penalty for illegal re-entry by an alien is not more than two years and a $250,000 fine.
The investigation of this case was conducted by Special Agents of the Homeland Security Investigation and IRS Criminal Investigation.
END
Four Men Indicted on Bank Robbery ChargesRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an indictment charging four men with conspiring to commit bank robberies. Two of the four men are also charged with actual bank robbery. Laquan Ealey, 23, Abraham Osorio, 21, Luis Osorio, 24, and Jefery Steadman-Loyd, 19, all of Rochester, N.Y., are charged with conspiring to commit bank robbery. Defendants Laquan Ealey and Abraham Osorio are also charged with bank robbery. Bank robbery carries a maximum penalty of 20 years in prison. The conspiracy charge carries a maximum penalty of five years in prison. Each charge carries a maximum fine of $250,000.
Assistant U.S. Attorney Everardo A. Rodriguez, who is handling the case, stated that according to the indictment, on Saturday June 7, 2014, Laquan Ealey and Abraham Osorio, robbed the Chase Bank located at 2900 Dewey Avenue in Rochester. The defendants entered the bank and walked up to a teller station. Ealey was wearing a baseball cap, gloves, and black hair extensions, Abraham Osorio a red baseball cap and sunglasses. Ealey then passed a note to the teller that stated "Give me all the money or everyone dies in here." Ealey then told the teller "Give me all your money or everyone here will die, I have a gun." The teller then handed Ealey an amount of money. The defendants then exited the bank, driving away in a 2002 blue Ford Explorer that was parked on the street near the bank. The robbery was recorded on bank surveillance cameras.
On June 14, 2914, Ealey and Osorio attempted to rob the Citizens Bank at 230 Waring Road in Rochester. Luis Osorio, Abraham’s older brother, and Jefery Steadman-Loyd were observed by police in the blue Explorer with Abraham Osorio and Laquan Ealey. The four initially drove by the bank and then stopped the Explorer several block away, at which time Luis Osorio exited the Explorer with a screwdriver in hand and replaced the vehicle’s two license plates with fake plates. The four men then drove back to parked next to the bank. Fearing that the men were about to rob the bank, Rochester Police patrol cars approached the Explorer. When the patrol cars engaged their emergency lights, the defendants sped away, leading police on a car chase over approximately five city blocks. During the effort to flee, the Explorer struck a police vehicle. When the Explorer finally came to a stop, Abraham Osorio was the driver, Luis Osorio was the front passenger and Ealey and Steadman-Loyd were in the back seat.
Police searched the Explorer and found, among other items, black hair extensions, several hats and caps, several pairs of sunglasses, a screwdriver and the two license plates which Luis Osorio had earlier replaced with fake plates.
The defendants were arraigned this afternoon before U.S. Magistrate Judge Marian W. Payson. They are due back in court for detention hearings scheduled for next Wednesday and Thursday, June 23 and 24.
The arrests are a culmination of a joint investigation on the part of the Greece Police Department, under the direction of Chief Patrick Phelan, the Federal Bureau of Investigation, the New York State Police, under the direction of Major Scott Crosier, the United States Marshals Service, under the direction of Charles Salina, and the Rochester Police Department, under the direction of Chief Michael Ciminelli.
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.Former Visa Consultant Pleads Guilty to Federal Charge for Embezzling over $245,000 from EmployerAlso Admits Collecting Fraudulent Unemployment BenefitsRead the Press Release
WASHINGTON – Claudius Kai Kpakima, 34, of Silver Spring, Md., pled guilty today to a federal offense stemming from the embezzlement of more than $245,000 from his employer, a visa processing company, announced U.S. Attorney Ronald C. Machen Jr., Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Bryan Porter, Commonwealth’s Attorney for the City of Alexandria, Va.
In a separate scheme, Kpakima admitted collecting more than $14,000 in fraudulent unemployment benefits.
Kpakima pled guilty in the U.S. District Court for the District of Columbia to a charge of interstate transportation of stolen property. The Honorable Senior Judge Royce C. Lamberth scheduled sentencing for Sept. 12, 2014. The charge carries a statutory maximum of 10 years in prison and financial penalties. Under federal sentencing guidelines, Kpakima faces a likely range of 46 to 57 months in prison and a fine of up to $50,000. The plea agreement calls for him to pay restitution of $246,191 to his former employer and another $14,615 to the District of Columbia Department of Employment Services.
According to the government’s evidence, Kpakima worked from May 2011 until November 2012 as a visa consultant for a company identified in court documents as “Company A,” a visa processing company that focused on obtaining expedited visas for individuals and corporate clients across the United States.
Kpakima performed visa processing and expediting duties, and he was able to request money orders from his supervisors through the company’s money order machine. He was required to provide a reason to supervisors for the money orders. Between May 2011 and November 2012, Kpakima fraudulently requested more than 2,900 money orders, which he then cashed at various establishments. He gave the establishments various reasons why he had the money orders, including a false claim that he got them in return for delivering passports.
All told, Kpakima obtained and cashed $246,191 in money orders, even though he was not entitled to any of this money.
In the second scheme, between July 2011 and June 2012, while Kpakima was working for “Company A,” he received $14,615 in fraudulent unemployment benefits from the District of Columbia Department of Employment Services. On at least 35 occasions, he recertified that he was eligible for these benefits when he was in fact working at “Company A.”
Kpakima has several previous convictions for theft and related activity. His plea agreement is part of a broader resolution that includes charges filed in the City of Alexandria, Va. A court appearance there is scheduled for October 2014.
In announcing the plea, U.S. Attorney Machen, Assistant Director in Charge Parlave, and Commonwealth’s Attorney Porter commended the work of those who investigated the case from the FBI and the Alexandria, Va. Police Department. They also expressed appreciation for the assistance provided by the Metropolitan Police Department (MPD) and Assistant Commonwealth's Attorney David Lord of the Alexandria Office of the Commonwealth’s Attorney, who is prosecuting the case in Virginia. They acknowledged the efforts of those who handled the case for the U.S. Attorney’s Office, including Catherine K. Connelly, Deputy Chief of the Criminal Division, who assisted with forfeiture issues; Paralegal Specialist Donna Galindo, and Intelligence Specialist Sharon Johnson. Finally, they thanked Assistant U.S. Attorney Philip A. Selden, who is prosecuting the case in the District of Columbia.
14-142Former School Teacher, Don Francis, Jr., Indicted on Child Pornography ChargeRead the Press Release
A former school teacher was indicted by a federal grand jury today for crimes involving the sexual exploitation of children, announced United States Attorney Kenneth Allen Polite, Jr.
According to court records, on February 5, 2014, Special Agents with the U.S. Department of Homeland Security-Homeland Security Investigations assisted the Louisiana Department of Justice and the Jefferson Parish Sheriff’s Office with the execution of a search warrant in a child exploitation investigation at the residence of DON FRANCIS, JR., 43, a resident of Metairie, Louisiana. FRANCIS has been in state custody since his February 5, 2014 arrest. As a result of today’s federal indictment, FRANCIS will be transferred to federal custody.
If convicted, FRANCIS faces a mandatory minimum penalty of five years and a maximum penalty of twenty years, followed by up to a lifetime term of supervised release, and a $250,000 fine.
U. S. Attorney Polite reiterated that the Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov. For more information about internet safety education, please visit www.projectsafechildhood.gov and click on the tab "resources."
This case was investigated by special agents from the U. S. Department of Homeland Security-HSI, the Louisiana Department of Justice, and the Jefferson Parish Sheriff’s Office. The prosecution of this case is being handled by Project Safe Childhood Coordinator and Fraud Unit Chief, Assistant U. S. Attorney Brian M. Klebba.
(Download Indictment )
Former MPD Officer Pleads Guilty to Charges of Pandering of A Minor and Possession of Child Pornography-Admits to Offenses Involving Three Teenage Girls-Read the Press Release
WASHINGTON – Linwood Barnhill, 48, a former officer with the Metropolitan Police Department (MPD), pled guilty today to two counts of pandering of a minor and one count of possession of child pornography, announced U.S. Attorney Ronald C. Machen Jr., Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Cathy L. Lanier, Chief of the Metropolitan Police Department.
Barnhill, who was assigned to the Seventh Police District, entered the guilty plea in the U.S. District Court for the District of Columbia. He has resigned from the department.
The Honorable Rosemary M. Collyer scheduled sentencing for Sept. 4, 2014. The plea agreement, which is subject to the Court’s approval, calls for a prison sentence of seven years. Barnhill also will be required to register as a sex offender for at least 25 years.
According to the government's evidence, on Dec. 3, 2013, officers with the MPD’s Youth Investigations Division located a missing 16-year-old girl at Barnhill’s residence in Washington, D.C. Over the course of the previous two weeks, the government’s evidence showed, Barnhill had begun the process of cultivating the juvenile to engage in prostitution, including taking clothed and unclothed photographs of her. During this time-frame, he stated that he was going to send the photos to a man who was interested in “an appointment” with her. Barnhill further explained that he was going to set up a “date” for her to engage in sexual acts with this man, who would pay her $80. The juvenile was to provide Barnhill with $20 after the completion of the “date.” Barnhill arranged to have the juvenile’s hair done in preparation for the date. The 16-year-old never actually engaged in prostitution for the defendant.
During the course of the ensuing investigation, MPD officers and members of the FBI’s Child Exploitation Task Force learned that the defendant was involved in prostitution-related activities with other adult and juvenile females, including a 15-year-old.
According to the government’s evidence, the 15-year-old met Barnhill in September 2013, when he pulled up to her at the bus stop and asked if she was interested in modeling for him. The 15-year-old agreed to model for the defendant and went back to his apartment to “take modeling pictures.” Barnhill, who asked her to escort for him, took a series of clothed and unclothed photographs of the girl. Later that night, he contacted her by cell phone and told her that he had somebody that wanted to meet her for a “date.” Barnhill collected the money and paid the 15-year-old a portion of that money once she was finished with the “date.”
In addition, during the course of their investigation, law enforcement identified a 17-year-old female who also met the defendant in October 2013 when he pulled up to her at a bus stop in Washington, D.C. and asked her if she wanted to model. Sometime later, the 17-year-old went to Barnhill’s residence. He brought her into his bedroom where he took multiple photographs of her, clothed and unclothed. After taking the photos, Barnhill asked the 17-year-old to perform oral sex on him. While she performed oral sex, Barnhill held his cellular phone and video-recorded the session. That video was recovered from a cell phone seized from the defendant’s residence pursuant to a search warrant.
Barnhill has been in custody since his arrest in December 2013.
“Linwood Barnhill betrayed his duty to protect the community by trying to exploit teenage girls," said U.S. Attorney Machen. “As a result of his deplorable conduct, he will now be headed to prison to join the criminals he spent his career locking up. We appreciate the tremendous work of the MPD detectives and FBI agents who worked so hard to bring Mr. Barnhill’s betrayal to light.”
“The FBI is committed to apprehending individuals who sexually exploit young girls, and we will continue to work with our law enforcement partners to bring these predators to justice, no matter who they are or what their profession is,” said Assistant Director in Charge Parlave.“A person of this character has no business being a police officer,” said Chief Lanier. “This is a disgrace to the thousands of hard working men and women of the Metropolitan Police Department who have integrity and put their lives on the line each day.”
This case was brought as part of the Department of Justice's Project Safe Childhood initiative and investigated by the FBI's Child Exploitation Task Force, which includes members of the FBI's Washington Field Office and MPD. In February 2006, the Attorney General created Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorney's Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
In announcing the guilty plea, U.S. Attorney Machen, Assistant Director Parlave and
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Chief Lanier commended the work of the MPD detectives and Special Agents of the FBI’s Child Exploitation Task Force. They also expressed appreciation for the efforts of Assistant U.S. Attorney Ari Redbord, who is prosecuting the case.Former MPD Officer Pleads Guilty to Charges of Pandering of A Minor and Possession of Child Pornography-Admits to Offenses Involving Three Teenage Girls-Read the Press Release
WASHINGTON – Linwood Barnhill, 48, a former officer with the Metropolitan Police Department (MPD), pled guilty today to two counts of pandering of a minor and one count of possession of child pornography, announced U.S. Attorney Ronald C. Machen Jr., Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Cathy L. Lanier, Chief of the Metropolitan Police Department.
Barnhill, who was assigned to the Seventh Police District, entered the guilty plea in the U.S. District Court for the District of Columbia. He has resigned from the department.
The Honorable Rosemary M. Collyer scheduled sentencing for Sept. 4, 2014. The plea agreement, which is subject to the Court’s approval, calls for a prison sentence of seven years. Barnhill also will be required to register as a sex offender for at least 25 years.
According to the government's evidence, on Dec. 3, 2013, officers with the MPD’s Youth Investigations Division located a missing 16-year-old girl at Barnhill’s residence in Washington, D.C. Over the course of the previous two weeks, the government’s evidence showed, Barnhill had begun the process of cultivating the juvenile to engage in prostitution, including taking clothed and unclothed photographs of her. During this time-frame, he stated that he was going to send the photos to a man who was interested in “an appointment” with her. Barnhill further explained that he was going to set up a “date” for her to engage in sexual acts with this man, who would pay her $80. The juvenile was to provide Barnhill with $20 after the completion of the “date.” Barnhill arranged to have the juvenile’s hair done in preparation for the date. The 16-year-old never actually engaged in prostitution for the defendant.
During the course of the ensuing investigation, MPD officers and members of the FBI’s Child Exploitation Task Force learned that the defendant was involved in prostitution-related activities with other adult and juvenile females, including a 15-year-old.
According to the government’s evidence, the 15-year-old met Barnhill in September 2013, when he pulled up to her at the bus stop and asked if she was interested in modeling for him. The 15-year-old agreed to model for the defendant and went back to his apartment to “take modeling pictures.” Barnhill, who asked her to escort for him, took a series of clothed and unclothed photographs of the girl. Later that night, he contacted her by cell phone and told her that he had somebody that wanted to meet her for a “date.” Barnhill collected the money and paid the 15-year-old a portion of that money once she was finished with the “date.”
In addition, during the course of their investigation, law enforcement identified a 17-year-old female who also met the defendant in October 2013 when he pulled up to her at a bus stop in Washington, D.C. and asked her if she wanted to model. Sometime later, the 17-year-old went to Barnhill’s residence. He brought her into his bedroom where he took multiple photographs of her, clothed and unclothed. After taking the photos, Barnhill asked the 17-year-old to perform oral sex on him. While she performed oral sex, Barnhill held his cellular phone and video-recorded the session. That video was recovered from a cell phone seized from the defendant’s residence pursuant to a search warrant.
Barnhill has been in custody since his arrest in December 2013.
“Linwood Barnhill betrayed his duty to protect the community by trying to exploit teenage girls," said U.S. Attorney Machen. “As a result of his deplorable conduct, he will now be headed to prison to join the criminals he spent his career locking up. We appreciate the tremendous work of the MPD detectives and FBI agents who worked so hard to bring Mr. Barnhill’s betrayal to light.”
“The FBI is committed to apprehending individuals who sexually exploit young girls, and we will continue to work with our law enforcement partners to bring these predators to justice, no matter who they are or what their profession is,” said Assistant Director in Charge Parlave.“A person of this character has no business being a police officer,” said Chief Lanier. “This is a disgrace to the thousands of hard working men and women of the Metropolitan Police Department who have integrity and put their lives on the line each day.”
This case was brought as part of the Department of Justice's Project Safe Childhood initiative and investigated by the FBI's Child Exploitation Task Force, which includes members of the FBI's Washington Field Office and MPD. In February 2006, the Attorney General created Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorney's Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
In announcing the guilty plea, U.S. Attorney Machen, Assistant Director Parlave and
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Chief Lanier commended the work of the MPD detectives and Special Agents of the FBI’s Child Exploitation Task Force. They also expressed appreciation for the efforts of Assistant U.S. Attorney Ari Redbord, who is prosecuting the case.Former Federal Bureau of Prisons Employee Convicted of Fraudulently Obtaining Federal Workers' Compensation BenefitsRead the Press Release
United States Attorney James Santelle announced today that after a four-day trial, a federal jury in the Eastern District of Wisconsin found Christopher A. Seifer (age 43) of Westfield, WI guilty yesterday of fraudulently obtaining reimbursement payments from the Department of Labor’s Office of Workers' Compensation Program for medically related travel.
On February 4, 2014, Mr. Seifer was charged in a five-count indictment alleging that he had submitted over 1,380 fraudulent claims seeking reimbursement from the federal government for mileage expenses that he falsely claimed to have incurred by driving to health clubs for rehabilitation. The indictment alleges that Mr. Seifer did not, in fact, travel to the health clubs on many of his claimed dates of travel between March 28, 2006, and October 2, 2012, for which Mr. Seifer sought and received reimbursement of travel expenses totaling in excess of $84,000.
The evidence produced at trial demonstrated that Mr. Seifer defrauded the Department of Labor’s Office of Workers' Compensation Program, which provides disability-related benefits to federal workers who suffer disabilities as a result of work-related injuries, by submitting false travel reimbursement claims and obtaining payments on those false claims. Mr. Seifer had formerly been employed by the United States Bureau of Prisons as an Electronics Technician at the Federal Correctional Institution in Oxford, Wisconsin, where he suffered work-related injuries and was then entitled to receive benefits, including medical benefits under the Federal Employees' Compensation Act.
In announcing the verdict, United States Attorney James L. Santelle stated: “This conviction and others like it reflect our continuing, focused work in investigating and prosecuting those individuals, including employees of the federal government, who wrongly use taxpayers’ monies for their own purposes. The partnership among the United States Department of Labor and the United States Department of Justice in identifying and cataloguing many instances of fraud, including those of the sort that Mr. Seifer committed, is not only critical to our effective response to behaviors involving false claims but also reflects the unified mission and strategy of all law enforcement entities here in Eastern Wisconsin.”"We are pleased to work together with our law enforcement partners to pursue such significant fraud by federal employees" stated John F. Oleskowicz, Special Agent in Charge of the United States Department of Justice Office of the Inspector General, Chicago Field Office. Oleskowicz continued "We hope that this verdict will serve to deter others from stealing federal funds."
This case was investigated by the United States Department of Labor, Office of Inspector General, Office of Labor Racketeering & Fraud Investigations and the United States Department of Justice Office of the Inspector General, Chicago Field Office and was prosecuted by Assistant United States Attorneys Scott Campbell and Benjamin Proctor.
Former Executive Director of Chelsea Housing Authority Sentenced for Rigging Inspection ProcessRead the Press Release
BOSTON – The former Executive Director of the Chelsea Housing Authority (CHA) was sentenced in federal court today for his role in rigging the inspection process for federally-funded housing units.
Michael E. McLaughlin, 68, of Dracut, who is already serving a three-year prison term for falsifying records to conceal his $360,000 salary as Executive Director, was ordered by U.S. District Judge Douglas P. Woodlock to serve an additional 12 months in prison and pay a $3,000 fine for his conviction for conspiring to defraud the United States and the U.S. Department of Housing and Urban Development (HUD) by impairing, impeding, and defeating the proper operation of HUD’s physical condition assessment.
Pursuant to federal regulations, to determine whether a public housing authority is meeting the standard for its residents of conditions that are “decent, safe, sanitary, and in good repair,” HUD’s Real Estate Assessment Center (REAC) is required to “provide for an independent physical inspection of a public housing authority’s property or properties that includes, at a minimum, a statistically valid sample of the units in the CHA’s public housing portfolio to determine the extent of compliance with the standard.” REAC inspections are conducted by independent contractors who have received training from REAC on the inspection protocol and regulations, and have been certified. Once certified, an inspector is given an inspector number and with a password can access the secure REAC server which contains data on all public housing authorities and also later enables the inspector to generate a random sample of units at the scheduled date of the inspection.
From 2006 through November 2011, McLaughlin conspired with his Assistant Director, James Fitzpatrick, and Bernard Morosco, whom they hired as a consultant for the REAC inspection process in those years. Morosco, himself a certified REAC inspector who had access to the secure REAC database, identified in advance the units of the CHA that would be randomly selected to be inspected by the assigned HUD REAC inspector on the day of the inspection. Morosco then provided to McLaughlin and Fitzpatrick a list of those units to be inspected sufficiently in advance of the inspection so that they could organize and direct REAC “SWAT” Teams of CHA employees to concentrate on ensuring that any needed repairs would be made to those identified units. When the REAC inspectors conducted the inspections in 2007, 2009 and 2011, the units that were randomly selected were the same as the ones provided in advance by Morosco.The trial of Fitzpatrick and Morosco has yet to be scheduled.
United States Attorney Carmen M. Ortiz and Christina Scaringi, Special Agent in Charge of the U.S. Department of Housing and Urban Development, Office of Inspector General, made the announcement today.
The case is being prosecuted by Assistant U.S. Attorneys S. Theodore Merritt of Ortiz’s Public Corruption and Special Prosecutions Unit and Brian Perez-Daple of Ortiz’s Major Crimes Unit.
Former Cay Clubs Executives Charged with Obstruction of the U.S. Securities and Exchange Commission and Wire Fraud ConspiracyRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), and Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that Fred Davis Clark, Jr., a/k/a Dave Clark, 56, and Cristal R. Clark, a/k/a Cristal R. Coleman, 41, were charged with obstruction of the U.S. Securities and Exchange Commission (SEC), and with wire fraud and conspiracy to commit wire fraud. Fred Davis Clark and Cristal Clark, both United States citizens and former residents of Monroe County, were apprehended with the assistance of foreign law enforcement earlier this week. Fred Davis Clark was apprehended while transiting from Honduras to Panama, and Cristal Clark was apprehended in Honduras. Both were returned to the United States with the assistance of the U.S. Marshal’s Service (USMS). Fred Davis Clark made his initial appearance in Key West before U.S. Magistrate Judge Lurana Snow.
According to the indictment, Fred Davis Clark and Cristal Clark were former executives of Cay Clubs Resorts and Marinas (Cay Clubs), which raised more than $300 million from approximately 1,400 investors through the sale of vacation rental units in Florida and elsewhere. Fred Davis Clark and Cristal Clark operated the company from an office in Key Largo. After the collapse of Cay Clubs, the SEC began an investigation into allegations of fraud at Cay Clubs. According to the indictment, Fred Davis Clark and Cristal Clark engaged in conduct aimed at concealing the location of assets under their control, and Fred Davis Clark gave false and misleading testimony to the SEC in connection with its investigation.
Furthermore, after the collapse of Cay Clubs, Fred Davis Clark and Cristal Clark initiated another venture to operate pawn shops in the Caribbean. According to the indictment, using the same bank accounts and shell companies based in Key Largo that they controlled during their Cay Clubs activities, Fred Davis Clark and Cristal Clark engaged in fraud and theft of funds from CMZ Group, LTD, a Cayman Islands company that operated pawn shops in the Caribbean. According to the indictment, Fred Davis Clark and Cristal Clark obtained money and property from CMZ Group, LTD, by siphoning off funds from the business operations of CMZ Group, so that the defendants could lead a lavish lifestyle.
Furthermore, in or around January 2013, shortly before an action was brought by the SEC alleging that they committed securities fraud, the indictment alleges, Fred Davis Clark and Cristal Clark caused the transfer of nearly $2 million to a bank account they controlled in Honduras for the purpose of preventing the SEC from learning the source, nature, location and control of these monies.
Mr. Ferrer commended the investigative efforts of ICE-HSI and IRS-CI, and the assistance of the SEC Miami Regional Office and the USMS in this matter. The matter is being prosecuted by Assistant U.S. Attorney Jerrob Duffy.
An indictment is only an accusation and the defendant is presumed innocent until proven guilty.
Attachment:
Fred Davis Clark - Indictment (PDF)
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Background Investigator for Federal Government Pleads Guilty to Making A False StatementRead the Press Release
WASHINGTON – Todd D. Mitnick, 36, a former background investigator who did work under contract for the U.S. Office of Personnel Management (OPM), pled guilty today to a charge stemming from his falsification of work on background investigations of federal employees and contractors, announced U.S. Attorney Ronald C. Machen Jr. and Patrick E. McFarland, Inspector General for the Office of Personnel Management.
Mitnick, of Plainview, N.Y., pled guilty in the U.S. District Court for the District of Columbia to making a false statement. The Honorable Senior Judge Thomas F. Hogan scheduled sentencing for Sept. 19, 2014. The charge carries a statutory penalty of up to five years in prison and a fine of up to $250,000. As part of the plea, Mitnick has agreed to pay $86,181 in restitution to the federal government.
According to a statement of offense submitted to the Court, Mitnick was employed by USIS, formerly known as U.S. Investigations Services, Inc., as an investigator under contract to conduct background investigations on behalf of OPM’s Federal Investigative Services.
Between September 2010 and August 2011, in numerous Reports of Investigations on background investigations, Mitnick represented that he had interviewed a source or reviewed a record regarding the subject of the background investigation. In fact, he had not conducted the interviews or obtained the records of interest. These reports were utilized and relied upon by the agencies requesting the background investigations to determine whether the subjects were suitable for positions having access to classified information, for positions impacting national security, or for receiving or retaining security clearances.
Mitnick’s false representations have required Federal Investigative Services to reopen and rework numerous background investigations that were assigned to him during the time period of his falsifications, at an estimated cost of at least $86,181 to the U.S. government.
Federal Investigative Services has a robust integrity assurance program which utilizes a variety of methods to ensure the accuracy of reported information. The falsification of investigative case work by the defendant was detected through the program.
This is one of numerous cases prosecuted by the U.S. Attorney’s Office for the District of Columbia since 2008 involving false representations by background investigators and record checkers working on federal background investigations. In addition to Mitnick, 18 other background investigators and two record checkers have been convicted of charges.
Federal Investigative Services, through its workforce of approximately 7,600, including 6,100 field investigators, is responsible for conducting background investigations for numerous federal agencies and their contractors, on individuals either employed by or seeking employment with those agencies or contractors. Federal Investigative Services conducted more than 2.3 million investigations during the 2013 fiscal year. More than 700,000 of these investigations involved applicants for access or continued access to classified information.
In performing background investigations, the investigators conduct interviews of individuals who have information about the person who is the subject of the review. In addition, the investigators seek out, obtain, and review documentary evidence, such as employment records, to verify and corroborate information provided by either the subject of the background investigation or by persons interviewed during the investigation. After conducting interviews and obtaining documentary evidence, the investigators prepare a Report of Investigation containing the results of the interviews and document reviews, and electronically submit the material to OPM in Washington, D.C. OPM then provides a copy of the investigative file to the requesting agency, which can use the information to determine an individual’s eligibility for employment or a security clearance.
In announcing the plea, U.S. Attorney Machen and Inspector General McFarland praised the efforts of Assistant Special Agent in Charge Nathaniel Smith, OPM, Office of the Inspector General, and Philip Kroop, David Newcomer, and Kevin Cassidy, OPM, Federal Investigative Services. They also acknowledged the work of Paralegal Specialist Donna Galindo and former Paralegal Specialist Nicole Wattelet of the U.S. Attorney’s Office, as well as Assistant U.S. Attorneys Ellen Chubin Epstein and Philip A. Selden, who investigated and prosecuted this matter.
14-145Florence Man Pleads to Possessing Child PornographyRead the Press Release
Contac Persont: Bill Day (803) 929-3000
Columbia, South Carolina ----- United States Attorney Bill Nettles stated today that Andrew Stephen Jackson, age 44, of Florence, South Carolina has entered a guilty plea in federal court in Florence, to possession of child pornography, a violation of 18 U.S.C. § 2252A(a)(5)(B) and (b)(2) . United States District Judge R. Bryan Harwell of Florence accepted the guilty plea and will impose sentence after he has reviewed the presentence report which will be prepared by the U.S. Probation Office.
Evidence presented at the change of plea hearing established that Jackson was trading child pornography with an individual in Australia in October 2010. A search warrant was executed at Jackson's residence and thousands of images of child pornography were found on Jackson's computers.
Mr. Nettles stated the maximum penalty for possession of child pornography is imprisonment for 10 years and/or a fine of $250,000.
The case was investigated by agents of the FBI. Assistant United States Attorney William E Day, II of the Columbia office is prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys’ Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information, please visit www.projectsafechildhood.gov.# # #
Federal Jury Convicts Felon of Stealing and Selling over Thirty Firearms from A Port Allen Gun ClubRead the Press Release
BATON ROUGE, LA - United States Attorney Walt Green announced that a federal jury returned unanimous verdicts of guilty yesterday afternoon against JOSEPH D. MELANCON, age 45, of Lafayette, Louisiana, for conspiring to steal firearms, possess and sell stolen firearms, and possess firearms by a convicted felon; stealing from a licensed federal firearms dealer; and possessing firearms as a convicted felon.
As a result of his convictions, and his apparent status as an armed career criminal under federal law, MELANCON faces up to life in prison, a fine up to $750,000, restitution to victims, and forfeiture of the proceeds of his criminal activity. His sentencing date has not been set.
According to evidence presented during the four day trial before U.S. District Judge Shelly Dick, MELANCON and Dustin Ray burglarized the Hunter’s Run Gun Club in Port Allen, Louisiana, on the night of April 13, 2012, and stole over thirty (30) firearms. MELANCON had previously worked at the Gun Club and used that knowledge to avoid security measures. Later, with the assistance of Jeremy Smothers, MELANCON sold firearms stolen from the Gun Club to others, including David Narcisse, Jr., a convicted felon.
Dustin Ray, age 31, of New Iberia, Louisiana, pled guilty to conspiring to steal firearms, possess stolen firearms, and possess firearms as a convicted felon; stealing from a licensed federal firearms dealer; and possessing firearms as a convicted felon. He awaits sentencing.
Jeremy J. Smothers, age 32, of New Iberia, Louisiana, pled guilty to conspiring to possess, sell, and dispose of stolen firearms. He awaits sentencing.
David J. Narcisse Jr., age 31, of Lafayette, Louisiana, pled guilty to possession of a firearm by a convicted felon. He awaits sentencing.
U.S. Attorney Walt Green stated: “Stopping violent, career criminals from stealing, possessing, and selling guns to other criminals is critically important to the safety of our community. I am proud of the prosecutors and agents who worked diligently on this important matter and look forward to our office’s continued vigilance against armed felons.”
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the West Baton Rouge Sheriff’s Office, and the Lafayette Parish Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorneys Reginald E. Jones and Robert W. Piedrahita who serves as Litigation Counsel.
Federal Grand Jury Indicts Rahatul Khan and Michael Wolfe for Allegedly Attempting to Provide Material Support to TerroristsRead the Press Release
'A federal grand jury in the Western District of Texas returned separate indictments Wednesday charging
Rahatul Khan and Michael Wolfe with attempting to provide material support to terrorists announced Robert Pitman, United States Attorney for the Western District of Texas, Christopher Combs, Federal Bureau of Investigation Special Agent in Charge of the San Antonio Division, and John Carlin, Assistant Attorney General for National Security.Khan (a.k.a. “Rahat Khan,” “AuthenticTauheed19,” and “AT19”), age 23 of Round Rock, TX, is charged with conspiring to provide material support to terrorists in violation of Title 18 USC Section 2339A. From March 2011 to January 2012, Khan allegedly conspired with others to recruit persons to travel overseas to support terrorist activities including committing violent jihad.
Wolfe (a.k.a. “Faruq”), age 23 of Austin, TX, is charged with attempting to provide material support to terrorists. Wolfe allegedly planned to travel to the Middle East to provide his services to radical groups engaged in armed conflict in Syria.
A detention hearing for Defendant Khan, originally scheduled for today, has been reset to June 30 at 2:30 p.m., before U. S. Magistrate Judge Mark Lane in Austin. Defendant Wolfe waived hearing on the Government’s motion to detain him and will remain in custody. Both defendants have waived formal arraignment and have entered not guilty pleas to the charges against them. Khan and Wolfe face up to 15 years in federal prison and a maximum $250,000 fine upon conviction.
Both indictments resulted from a Central Texas Joint Terrorism Task Force investigation conducted by the Federal Bureau of Investigation together with the Internal Revenue Service-Criminal Investigation, United States Citizenship and Immigration Services, United States Army Intelligence, Austin Police Department, Round Rock Police Department, Killeen Police Department, University of Texas Police Department, Travis County Sheriff's Office, Texas Department of Public Safety, Office of the Texas Attorney General and the Texas Alcoholic Beverage Commission.
Assistant United States Attorneys Gregg N. Sofer and Michael Galdo, together with the Department of Justice’s National Security Division Counterterrorism section trial attorneys Josh Parecki and Michael Dittoe, are prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Doctor and Wife Convicted of Decade-Long Tax FraudRead the Press Release
SAN DIEGO – United States Attorney Laura E. Duffy announced that a federal jury returned guilty verdicts on all counts against Dr. James Francis Murphy and his wife, Denine Christine Murphy, based on their years-long efforts at preventing the IRS from assessing and collecting the hundreds of thousands of dollars of income taxes they owed from the operation of their medical practice in Encinitas, California, and Omaha, Nebraska.
Evidence presented at trial showed that despite earning as much as $1 million a year from their osteopathic medical practice, Dr. and Mrs. Murphy paid almost no federal income taxes for a decade. Instead of accurately declaring their income and paying taxes lawfully owed to the United States, and despite repeated warnings from the IRS, the Murphys filed false income tax returns for the medical practice using a bogus “trust,” filed false personal income tax returns that concealed their true income, and in certain years simply refused to file required tax returns at all.
As presented at trial, when confronted by the IRS and notified that they owed substantial sums in taxes, the Murphys engaged in a variety of schemes to thwart the United States’ attempts to correctly assess and collect these taxes. These schemes included: (1) falsely claiming that they were not citizens of the United States; (2) frivolously claiming that the federal tax laws did not apply to them; (3) fraudulently presenting fictitious documents such as “Private Offset Discharge and Indemnity Bonds” and “Bonded Promissory Notes,” purportedly worth hundreds of millions of dollars, as payment on their tax obligations; and (4) fraudulently claiming that the hundreds of thousands of dollars they paid to credit card companies, utilities and other vendors were actually withholdings of federal income taxes, thereby entitling them to over a million dollars in refunds from the IRS. The defendants even claimed that then-Secretary of the Treasury Henry Paulson was their “fiduciary” and was responsible for paying their taxes.
The defendants were found guilty by a jury after a two-week trial held before U.S. District Judge Anthony J. Battaglia, and were ordered to appear again for sentencing on September 12, 2014.
U.S. Attorney Duffy said she is pleased with the jury’s verdict. “The Murphys have found out that the old adage is true: Nothing is certain but death, taxes and prosecution if you don’t pay your taxes.”
Erick Martinez, Special Agent in Charge of IRS Criminal Investigation’s Los Angeles Field Office commented, “James and Christine Murphy’s use of a sham trust served no other purpose than to hide the income they earned from the medical practice. Their filing of false tax returns and false claims of payment to the IRS were tax elimination tactics, used to further promote their criminal activities. Today’s jury verdict emphasizes that those who use these elaborate tax schemes run the risk of criminal prosecution.”
DEFENDANT Dr. James Francis Murphy Age: 53 Encinitas, California Denine Christine Murphy Age: 51 Encinitas, California CHARGESCount 1: Corrupt interference with the administration of the internal revenue laws, in violation of 26 U.S.C. § 7212(a). Both defendants. Maximum penalties – 3 years’ custody, $250,000 fine.
Counts 2-5: Presenting fictitious financial obligations, in violation of 18 U.S.C. § 514. Defendant Dr. James Francis Murphy. Maximum penalties – 10 years’ custody and $250,000 fine (per count).
Counts 6-8: False claims to the United States, in violation of 18 U.S.C. § 287. Both defendants. Maximum penalties – 5 years’ custody and $250,000 fine (per count),
INVESTIGATING AGENCYInternal Revenue Service, Criminal Investigation
TIGTA (Treasury Inspector General for Tax Administration)
*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.
District Man Sentenced to 36 Years in Prison for 2011 Murder in Northeast Washington-Shooting Followed Carjacking and Robbery-Read the Press Release
WASHINGTON -David E. Warren, 28, of Washington, D.C., was sentenced today to 36 years in prison for the 2011 killing of a man in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Warren was found guilty by a jury in March 2014, following a three-week trial in the Superior Court of the District of Columbia. The jury convicted Warren of two counts of first-degree murder while armed during the commission of two separate felonies; second-degree murder while armed; kidnapping while armed; armed carjacking; armed robbery, and related weapons offenses. He was sentenced by the Honorable Rhonda Reid Winston. Upon completion of his prison term, Warren will be placed on five years of supervised release.
According to the government’s evidence, shortly before 11 p.m. on May 13, 2011, the victim, Ervin L. Griffin, 32, pulled his SUV into the 1200 block of 18th Street NE, soon after meeting several young women at a nearby bus stop. While Mr. Griffin was sitting in his SUV, which was parked in the middle of the street, Warren approached and told Mr. Griffin to leave.
Eventually, Mr. Griffin pulled into an alley off of the 1200 block of 18th Street NE, where Warren entered the passenger side of Mr. Griffin’s SUV and took his keys. Warren, armed with a semi-automatic firearm, then went to the driver’s side of the SUV, pulled Mr. Griffin out, and demanded money. Warren, along with others, then walked Mr. Griffin up an alley and into a yard behind 1218 18th Place NE, where Mr. Griffin was shot and killed.
Surveillance video from the Metropolitan Police Department’s closed circuit television cameras showed the events leading up to Mr. Griffin’s murder, and showed Warren and others exiting the alley where the murder took place within a minute after the murder.
In announcing the sentence, U.S. Attorney Machen commended the work of the detectives, officers, and crime scene technicians who investigated the case for the Metropolitan Police Department. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Litigation Technology Specialists Thomas Royal, William Henderson, and Paul Howell; Victim/Witness Advocate Marcia Rinker; and Paralegal Specialists Kelly Blakeney and Mia Beamon. Finally, he thanked former Assistant U.S. Attorney B. Michael Ortwein, who investigated and indicted the case, and Assistant U.S. Attorneys Michelle D. Jackson and Holly R. Shick, who prosecuted the case.
14-143District Man Sentenced to 107 Years in Prison for Two Shootings, Including Murder of Unarmed TeenagerDefendant and Two Accomplices Fired at Least 28 Shots at Group Attending Fourth of July Cook-OutRead the Press Release
WASHINGTON –Calvin Shaw, 24, of Washington, D.C., was sentenced today to 107 years in prison for his role in two shootings, including one in which he opened fire on a group of unarmed teenagers and young men who were gathered for a Fourth of July neighborhood cook-out, killing one of them, U.S. Attorney Ronald C. Machen Jr. announced.
Shaw, also known as Sharkim Sharp, was found guilty by a jury in April 2014, following a trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable Jennifer Anderson.
The jury found Shaw guilty of one count of first-degree murder while armed, five counts of assault with intent to kill while armed, two counts of aggravated assault while armed, and related weapons offenses for the fatal shooting, which took place on July 4, 2012 in the 5000 block of First Street NW. Shaw also was found guilty of two counts of assault with intent to kill while armed, one count of aggravated assault while armed, and related weapons offenses for an April 18, 2012 shooting that occurred in the same block.
According to the government’s evidence, the murder took place at about 7:55 p.m. on July 4, 2012, when Shaw and two accomplices walked into the 5000 block of First Street NW and opened fire on a group of unarmed teenagers and young men who were gathered to celebrate the Fourth of July holiday and enjoy a cookout.
As the teenagers and young men ran for cover, a gunshot pierced the back of 19-year-old Crevontai Key, severing his aortic arch and killing him. A second 17-year-old victim suffered serious injuries when he was shot in the abdomen. A 15-year-old victim was injured when a bullet grazed the top of the head. A fourth young man was shot in the back, with the bullet exiting his neck. Several other young men were shot at as they ran away. In total, Shaw and his two accomplices fired 28 times at the group of young men.
The jury also found Shaw guilty of the April 18, 2012 shooting of a young man in the same block, and of attempting to shoot another young man who rushed to that victim’s aid.
In a related matter, Shaw’s girlfriend, Tonika Hilliard, 24, was sentenced today to a three-year prison term for obstruction of justice. Hilliard, also of Washington, D.C., pled guilty to the charge, admitting she interfered with a grand jury investigation. The prison time was suspended on the condition that Hilliard successfully complete three years of supervised probation.
In announcing the sentence, U.S. Attorney Machen praised the efforts of those who worked on the case from the Metropolitan Police Department (MPD) and the FBI. U.S. Attorney Machen also expressed appreciation to those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Kelly Blakeney and Kwasi Fields; Victim/Witness Advocate Marcia Rinker; Witness Security Specialist Debra Cannon; and Litigation Technology Specialist Leif Hickling.
Finally, he commended the work of Assistant U.S. Attorneys Jennifer Kerkhoff and Michelle Parikh, who tried the case, as well as former Assistant U.S. Attorneys Bruce Hegyi and Heather Carlton, who investigated the case.
14-144Department of Defense Contractor Pleads Guilty to Production of Child PornographyRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Michael C. Vella (36, Riverview) today pleaded guilty to production of child pornography. He faces a minimum mandatory term of 15 years, up to a maximum penalty of 30 years in federal prison.
According to the plea agreement, a 16 year-old female reported to law enforcement that Vella had been forcing her to have sex with him since the middle of 2012. The victim disclosed that Vella had, on at least one occasion, utilized his laptop computer to record their sexual intercourse. At the time the arrest warrant was issued, Vella was deployed to Afghanistan as a Department of Defense contractor.
This case was investigated by the Federal Bureau of Investigation and the Hillsborough County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Stacie B. Harris.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Defendant Convicted in Identity Theft Tax Fraud and Social Security SchemesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Thomas Caul, Special Agent in Charge, Social Security Administration (SSA), Office of Inspector General, announce the conviction of Kevin Cimeus, 21, of Miami, after a four day jury trial in Fort Lauderdale for his roles in identity theft tax fraud and social security schemes.
Specifically, Cimeus was convicted of ten counts in the superseding indictment, including one count of conspiracy to steal government property or money, in violation of Title 18, United States Code, Section 371, three counts of theft of government money or property, in violation of Title 18, United States Code, Section 641, one count of access device theft, in violation of Title 18, United States Code, Section 1029(a)(3), and five counts of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). Sentencing is scheduled for September 4, 2014, before U.S. District Judge William J. Zloch. At sentencing, the defendant faces a maximum statutory sentence of up to five years in prison on the conspiracy count, ten years in prison on each of the theft of public money and access device theft counts, and a mandatory consecutive two years in prison on the aggravated identity theft counts.
On January 23, 2014, Cimeus pled guilty to one count of access device theft and one count of aggravated identity theft. At his sentencing hearing on April 22, 2014, the Court vacated this guilty plea based on statements made by the defendant during the hearing.
According to evidence presented at trial, during a search warrant of Cimeus’ residence, federal agents found over 2,400 social security numbers and names of real people stored on thumb drives, laptop computers, iPad, Cimeus’ email account and sheets of paper. The evidence at the trial also showed that Cimeus recruited Miami Dade College (MDC) students to allow the defendant to use their Higher One Bank accounts to receive fraudulently obtained tax refunds and that Cimeus used his own Higher One Bank and Chase accounts to receive fraudulently obtained tax refunds. Cimeus filed at least one thousand tax returns from two IP addresses. He also used the two IP addresses to access the Social Security Administration’s web site and create on line profiles for social security recipients in order to re-route the victims’ social security payments to other accounts.
Mr. Ferrer commended the investigative efforts of FBI. This case is being prosecuted by Assistant U.S. Attorney Gera R. Peoples.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Davenport Man Sentenced on Felon in Possession of Firearm and Drug Trafficking ChargesRead the Press Release
DAVENPORT, IA – On June 20, 2014, Thuan Van Nguyen, age 28, was sentenced by United States District Judge John A. Jarvey to 34 months’ imprisonment for Felon in Possession of a Firearm and Possession with Intent to Distribute Marijuana, announced United States Attorney Nicholas A. Klinefeldt. Nguyen was also ordered to serve two years supervised release following the imprisonment, forfeit $2,010 in cash and the firearm he possessed, and pay $200 towards the Crime Victims Fund.
On April 12, 2013, Davenport police searched Nguyen’s vehicle and residence pursuant to search warrants. In the vehicle, police located approximately 2 pounds of marijuana. In Nguyen’s residence, police located a rifle under Nguyen’s bed, packaging materials consistent with marijuana distribution, and $950 in currency. Police also seized $1,060 in currency on Nguyen’s person. Prior to April 12, 2013, Nguyen had been convicted of two felony crimes.
This case was investigated by the Davenport Police Department and the United States Bureau of Alcohol, Tobacco and Firearms (ATF). The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
(Download Press Release )
Columbia Gang Member Sentenced to Maximum 10 Years on Federal Firearm and Ammunition ChargeRead the Press Release
Contact Person: Stacey Haynes (803) 929-3000
Columbia, South Carolina ----- United States Attorney Bill Nettles stated today that MICHAEL JUAN SMITH, a/k/a “Flame,” a/k/a “Junior,” age 21, of Columbia, South Carolina was sentenced to 120 months (10 years) imprisonment today in federal court. Following the term of imprisonment, SMITH will be on federal supervised release for three (3) years. SMITH pled guilty on February 19, 2014, to being a felon in possession of a firearm and ammunition, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2). United States District Judge Joseph F. Anderson, Jr. imposed the sentence after a contested sentencing hearing. The sentence is the maximum sentence allowed under federal law for being a felon in possession of a firearm and ammunition. SMITH still faces pending charges in state court for the actual shooting that occurred on October 13, 2013.
Evidence presented at the change of plea hearing in federal court established that shortly after 2:00 am on October 13, 2013, SMITH, along with several friends, was in the Five Points area of Columbia. Surveillance videos show SMITH, a gang member, and his friends walk up Harden Street towards the Library nightclub. At one point, surveillance video shows SMITH adjusting a handgun in his jacket pocket as he walks up the street, transferring it from one pocket to another. SMITH and the group return down Harden Street a short time later and after passing by the fountain area where taxis pick up customers, SMITH and his group become involved in a confrontation with another group of individuals. At this point, SMITH fires his handgun striking an innocent bystander standing in line at the taxi stand. That bystander, an 18 year old college student, was paralyzed as a result. SMITH attempted to flee the scene on foot, but was immediately apprehended on Harden Street by a Columbia Police Department officer responding to the shooting. SMITH refused demands to take his hand from his jacket pocket and a search revealed a loaded Glock .40 caliber handgun in SMITH’s front jacket pocket. At the scene, SMITH voluntarily uttered, “I did not mean to shoot.” SMITH later told officers that people shot at him and he picked up the Glock from the ground as he ran away from them. Witnesses at the scene, however, identified SMITH as the shooter. An analysis of gunshot residue from SMITH’s hand was consistent with him having fired a gun and ballistics testing determined that a .40 caliber shell casing recovered at the scene of the shooting was consistent with being fired from SMITH’S .40 caliber handgun. A check of a law enforcement database revealed that the firearm had previously been reported as stolen during a burglary in Richland County.
The investigation revealed that SMITH, who was on state probation and also on state parole at the time of the incident, is prohibited under federal law from possessing firearms and/or ammunition based upon his prior state conviction for attempted burglary 2nd degree of a dwelling and a separate state conviction for burglary 2nd degree.
The case was investigated by the Columbia Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and was prosecuted as part of the joint federal, state and local Project CeaseFire initiative, which aggressively prosecutes firearm cases. Assistant United States Attorney Stacey D. Haynes of the Columbia office handled the case.#####
Cases Involving Sex Trafficking and Exploitation of Children on the Rise; Four Sentenced in One Day in Separate CasesRead the Press Release
SAN DIEGO – Four defendants from unrelated cases were sentenced in federal court today for crimes involving the sex trafficking and sexual exploitation of children, underscoring a continuing trend as prosecutions in this category continue to rise.
The number of defendants prosecuted for sex crimes that victimize and exploit children in the Southern District of California has increased 85 percent in the last five years, from 61 in 2009 to 113 in 2013. The increase is even more dramatic compared to 10 years ago, when only a few cases were logged.
The number of prosecutions involving sex crimes that victimize and exploit children in the Southern District of California has increased 65 percent in the last five years, from 49 in 2009 to 81 in 2013. And those numbers do not reflect that several recent sex trafficking cases have dozens of defendants each.
“The statistics show that one of our highest priorities is protecting children from predators who commit these heinous crimes against our community’s most vulnerable members,” said U.S. Attorney Laura Duffy.
The prosecutions are part of Project Safe Childhood, a nationwide initiative launched by the U.S. Department of Justice in 2006 to combat the growing epidemic of child sexual exploitation and abuse via the internet. The program’s primary goal is to locate, apprehend and prosecute individuals who exploit children through pornography and sex trafficking as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
DEFENDANT Tyson Lee Channell Age: 29 Case Number: 13cr1372-AJB Sentenced by U.S. District Judge Anthony J. Battaglia to 10 years in prison, followed by 10 years of supervised release, for acting as a pimp to a 14-year-old girl, at one point taking her to Las Vegas to work as a prostitute. Channel pleaded guilty in April of 2013 to transportation of a minor to engage in prostitution. Jamal Leland Landrum Age: 26 Case Number: 13cr1227-AJB Sentenced to 10 years in prison by U.S. District Judge Anthony J. Battaglia for sex trafficking of a 15-year-old girl in El Cajon. Landrum pleaded guilty in June of 2013 to sex trafficking of a minor. James Michael DiSalvo Age: 55 Case Number: 13cr4165-GPC Sentenced to nine years by U.S. District Judge Gonzalo P. Curiel. DiSalvo pleaded guilty in February 2014 to distribution of child pornography. Christopher Wissmath Age: 36 Case Number: 13cr3159-JM Sentenced by U.S. District Judge Jeffrey T. Miller to 30 months in prison and seven years of supervised release. Wissmath pleaded guilty in October of 2013 to transmitting information about a minor with intent to entice the minor. A fifth sentencing, that of Martell Davis, was scheduled to take place today but was postponed. Davis, who was wearing a T-shirt that said, “I Make Pimpin’ Look Easy” when he was arrested, pleaded guilty in September of 2013 to transportation of a minor to engage in prostitution, admitting he drove a 17-year-old girl to Yuma, Arizona, to engage in commercial sex acts. Case No. 13cr3149-JLS. INVESTIGATING AGENCYU.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI)
Federal Bureau of Investigation
San Diego Police Department
El Cajon Police Department*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.