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Friday 28 March 2014
Georgia Man Indicted for Stealing Deceased Persons' Identities to gain $2.3 Million in State Tax RefundsRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Georgia man has been indicted by a federal grand jury for a scheme using the identity information of deceased persons to obtain more than $2.3 million in tax refunds from several states.
Sirhon Rivers, also known as “Ron,” 40, of Georgia, was charged in a 32-count indictment returned under seal by a federal grand jury in Jefferson City, Mo., on March 19, 2014. That indictment was unsealed and made public following the arrest and initial court appearance of Rivers in Atlanta, Ga., on Tuesday, March 25, 2014. He remains in federal custody pending a detention hearing in Atlanta.
The federal indictment alleges that Rivers unlawfully obtained $547,000 from the Missouri Department of Revenue by filing fraudulent tax returns. Rivers allegedly used the same scheme in others states to unlawfully acquire a total of $2,365,000 in fraudulent state tax refunds. The indictment alleges that Rivers participated in this conspiracy to commit wire fraud and aggravated identity theft from January 2008 to August 2012.
According to the indictment, Rivers obtained personal identification information – including names, Social Security numbers, and dates of birth – from deceased persons. He allegedly submitted state tax returns using that information, adding false and fraudulent information such as employment and wages earned. State tax returns were submitted electronically, the indictment says, with the refunds electronically transferred to bank accounts that Rivers opened at several financial institutions.
In addition to the wire fraud and identity theft conspiracy, Rivers is charged with 25 counts of wire fraud, five counts of aggravated identity theft and one count of conspiracy to commit money laundering. The indictment also contains a forfeiture allegation, which would require Rivers to forfeit to the government any property derived from the proceeds of the alleged offenses.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Anthony P. Gonzalez. It was investigated by the FBI and the Missouri Department of Revenue Criminal Tax Investigations Bureau and the Missouri Department of Revenue Compliance and Investigation Bureau.Former President and Chief Executive Officer of Software Company Sentenced in Manhattan Federal Court to 63 Months in Prison for $6.3 Million Offering Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that SCOT ZARKIEWICZ, the co-founder and former President, Chief Executive Officer, Treasurer, and principal owner of SingleClick Systems Corp. (“SingleClick”), a Delaware-incorporated, New Jersey-based software company, was sentenced today in Manhattan federal court to 63 months in prison for perpetrating a scheme to defraud SingleClick investors. From mid-2009 through June 2013, ZARKIEWICZ solicited several investors to purchase millions of dollars of privately-held SingleClick stock based on fraudulent misrepresentations about the company’s operations and financial performance. As a result of his fraudulent scheme, ZARKIEWICZ collected, and maintained in SingleClick, approximately $6.3 million from 35 victims. ZARKIEWICZ pled guilty in November 2013 before U.S. District Judge Denise L. Cote., who also imposed today’s sentence.
Manhattan U.S. Attorney Preet Bharara said: “With today’s sentence, Scot Zarkiewicz is being held to account for misleading investors and betraying their trust with his multimillion-dollar fraud scheme.”
According to the Information to which ZARKIEWICZ pled guilty, statements made in open court, and other court documents:
SingleClick is a privately-held software company that was engaged in the business of providing individuals and businesses with network software products that facilitate content access and network and systems management from any internet-connected device. From mid-2009 through June 2013, ZARKIEWICZ solicited investor contributions to, and caused investors to maintain their investments in, SingleClick based on fraudulent misrepresentations.
Specifically, during the relevant period, ZARKIEWICZ told SingleClick investors, in both oral and written communications, that SingleClick had several large corporate clients, millions of dollars in annual revenue, and millions of dollars in cash in bank and brokerage accounts, when, in truth and in fact, and as ZARKIEWICZ well knew, SingleClick conducted minimal business operations, collected significantly less than a million dollars in annual revenue, and did not have more than approximately $513,000 in cash on hand. ZARKIEWICZ made these misrepresentations to induce potential investors to purchase SingleClick shares, and to induce existing investors to purchase additional shares and/or refrain from requesting redemptions of their investments. ZARKIEWICZ made these misrepresentations by, among other means, distributing fabricated bank, brokerage, financial, and tax statements to investors.
In May and June 2013, investors learned that SingleClick had very little cash available and confronted ZARKIEWICZ. ZARKIEWICZ admitted to investors that he lied about SingleClick’s business performance, fabricated records, and misled investors about the number of investors in, and operation of, SingleClick. Notwithstanding representations made in preceding years by ZARKIEWICZ that SingleClick had millions of dollars in revenue – including representations that SingleClick had generated $48 million in revenue in 2012 – since mid-2009, SingleClick has actually been generating thousands of dollars in revenue, not millions, and SingleClick’s total aggregate bank account balances have not exceeded approximately $513,000. In August 2013, after admitting his fraudulent conduct, ZARKIEWICZ resigned as CEO of SingleClick.
ZARKIEWICZ, 41, of Toms River, New Jersey, was also sentenced to three years of supervised release, ordered to forfeit $5.5 million as well as any remaining proceeds in SingleClick bank accounts, and pay over $6.3 million in restitution.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney David I. Miller is in charge of the prosecution. Assistant U.S. Attorney Paul Monteleoni is in charge of the asset forfeiture related to the prosecution.
Former Mutual Benefits Corporation Head Convicted for His Role in $1 Billion MBC SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (“FBI”), announce that defendant Joel Steinger, a/k/a “Joel Steiner,” (“Steinger”) pled guilty before U.S. District Judge Robert N. Scola, Jr. to conspiracy to commit mail and wire fraud, in violation of 18 U.S.C. §1349, as a result of his scheme to defraud investors in Mutual Benefits Corporation (“MBC”), which marketed viatical and life settlements.
Steinger is the final defendant to be convicted out of 13 charged as a result of the MBC scheme, which defrauded approximately 30,000 victims. As the de facto head of MBC, Steinger, along with conspirators Steven Steiner, a/k/a Steven Steinger, Michael McNerney, and Anthony M. Livoti, Jr., Esq., along with others, raised more than $1.25 billion from investors before being shut down by federal regulators in May 2004. By the time charges were filed in December, 2009, investor losses were estimated to amount to more than $800 million. Steinger is scheduled to be sentenced by U.S. District Judge Robert N. Scola, Jr. on June 6, 2014.
According to the evidence presented in a related trial and summarized during Steinger’s guilty plea, from approximately 1994 to May 2004, MBC purchased life insurance policies from persons suffering from AIDS, the chronically ill, and elderly persons. Having purchased the life insurance policies, MBC sold fractionalized interests in insurance policy death benefits, known as “viatical settlements,” to approximately 30,000 investors. MBC solicited the investments through an international network of sales agents. In promotional materials, MBC told investors that its viatical settlements offered a fixed rate of return with low risk, and that investors’ principal and returns were paid by the insurance companies. Under Steinger’s direction, MBC misrepresented various important facts relating to its viatical settlements, including, for example, the estimated life expectancies of the insured persons, the supposedly independent role of doctors determining those life expectancies, MBC’s fraudulent methods used to acquire life insurance policies, the risks associated with certain policies, the payment of premiums, and the source of funds used to pay investors.
Steinger, already a convicted felon at the time of the MBC fraud, hid behind a figurehead company president to conceal a criminal and disciplinary history that otherwise would have prevented the company from obtaining a license to conduct business in Florida and elsewhere.
Evidence supporting his guilty plea also established that new investor money was used to pay premiums on life insurance policies purchased by earlier investors and to pay investors who requested their money back. In essence, the evidence demonstrated that Steinger and his co-conspirators were operating a Ponzi-like scheme, using new investor money to pay for earlier investor obligations, and that money from new investors was continuously required to prevent the MBC Ponzi-scheme from collapsing, which, ultimately, it did.
Co-defendant Steiner was also a founding principal of MBC, was actively involved in MBC’s marketing and promotional activities, and encouraged investors to buy MBC’s investments. On September 3, 2013, Steiner pled guilty to charges in the same case. Steiner was also found guilty by a federal jury in a related case, United States v. Steven Steiner, No. 11-20578-CR-Williams in connection with money laundering and obstruction of justice related to the use and concealment of more than $15 million dollars in proceeds derived from the MBC fraud. Steiner was sentenced to a total of 15 years in prison.
Co-defendant McNerney, an attorney licensed by the State of Florida, assisted MBC with the marketing of its fraudulent investment by meeting with investors in his Fort Lauderdale law offices and encouraging them to purchase MBC investments. McNerney pled guilty in this case and was sentenced to five years in prison for his criminal conduct.
Co-defendant Livoti, Jr. was convicted for his role in the MBC fraud on December 4, 2013 after a jury trial. Livoti’s sentencing is set for April 1, 2014 before U.S. District Judge Robert N. Scola, Jr.
United States Attorney Wifredo A. Ferrer stated, “I am pleased to announce the guilty plea of Joel Steinger, who led one of the largest investment schemes in South Florida’s history. For a decade, Steinger and his co-defendants victimized approximately 30,000 people and stole nearly one billion dollars. I commend the prosecutors and agents who have worked so hard on this important matter.”
“Joel Steinger used Mutual Benefits Corp to bilk hundreds of millions of dollars from trusting investors,” said FBI Special Agent in Charge George L. Piro. “Now, with Joel Steinger's guilty plea, the FBI is pleased that all 13 defendants charged in the MBC scheme have all been convicted.”
Steinger is the thirteenth defendant convicted as a result of the MBC fraud.
Mr. Ferrer commended the investigative efforts of the FBI and the Miami Regional Office of the Securities and Exchange Commission, which previously brought a civil action against MBC and its principals. The MBC case is being prosecuted by Assistant U.S. Attorney Karen Rochlin.
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 Miami-Dade Department of Public Works Employee Is Sentenced to 30 Months in Prison for Accepting Bribes from ContractorRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that George Brown, 50, of Hollywood, was sentenced to 30 months in prison, one year of supervised release, and ordered to forfeit $13,000. Brown previously pled guilty in January 2014 to a one-count information charging him with accepting bribes in connection with programs receiving federal funds, in violation of Title 18, United States Code, Sections 666. The defendant was given until May 13, 2014 to surrender to the United States Bureau of Prisons.
According to documents filed in Court, Brown was the Roadway Lighting Coordinator for the Department of Public Works (Public Works) in Miami-Dade County. In this capacity, Brown was responsible for, among other things, overseeing the installation and/or maintenance of more than 24,000 street lights in the county’s roadway system. In 2011, a lighting contractor offered to provide Brown with “rewards” in exchange for Public Works’ purchase of the contractor’s lighting products. Brown agreed and subsequently accepted more than $13,000 in bribes from the contractor in 2011 and 2012. The bribes included appliances, computer equipment, and other merchandise, all paid for by the contractor. Among the merchandise that Brown received from the contractor was a 2.5 ton air conditioning unit, a Samsung stainless steel refrigerator, and a KitchenAid built-in single electric convection oven. The merchandise was either shipped directly to Brown’s home address or picked up by Brown at the contractor’s business in Miami.
During the investigation, the contractor began to cooperate with law enforcement and recorded the conversations with Brown. In one recorded conversation, Brown assured the contractor that no one else knew about their arrangement. In another recorded conversation, the two discussed delivery to Brown of certain merchandise costing approximately $2,600 in exchange for Brown’s assistance on a Public Works’ project on 27th Avenue in Miami.
Mr. Ferrer commended the investigative efforts of the FBI. The case is being prosecuted by Assistant U.S. Attorney Jeffrey N. Kaplan.
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 Denton County Insurance Agent Sentenced to 292 Months in Federal Prison and Ordered to Pay More Than $4 Million Restitution on Fraud ConvictionRead the Press Release
Defendant Used Elderly as Straw Buyers in Fraud Scheme
DALLAS - A former Denton County insurance agent, who was convicted at trial last summer on several felony offenses stemming from a scheme to defraud various life insurance companies, was sentenced today in federal court in Dallas.
U.S. District Judge Reed C. O’Connor sentenced Vincent Bazemore, 40, formerly of Aubrey, Texas, to serve a total of 292 months in federal prison and ordered him to pay $4,014,627 in restitution. A jury deliberated just one hour before convicting him in July 2013 on all counts of an indictment charging four counts of mail fraud. Today’s announcement was made by U.S. Attorney Sarah R. Saldana of the Northern District of Texas.
Between October 2007 and April 2009, Bazemore, an insurance agent, engaged in a scheme to obtain substantial commissions by inducing life insurance companies to issue policies on applications of individuals who appeared to be wealthy and seeking insurance for estate planning purposes, when in fact, the applicants were of modest financial means, and the policies were intended to be transferred to investors.
Bazemore solicited elderly individuals to apply for policies by representing that the life insurance was an investment with no financial cost or exposure and would result in a sizable monetary benefit to the individuals heirs. Bazemore prepared the applications and related documents, on behalf of the applicants that contained forged signatures and falsified financial information to induce the life insurance companies into issuing the policies.
Bazemore also submitted the false and fraudulent applications and related documents to financial institutions to obtain premium financing on the policies. In fact, the applicants were of modest financial means and the policies were obtained for the purpose of being transferred to investors. Bazemore had agreements with insurance companies and managing agents that provided he would receive, for each policy issued on an application he submitted, a commission of 95 to 105 percent of the first year’s premium paid on the policy.
Today's announcement is related to efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) that was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
The FBI investigated the case. Assistant U.S. Attorney Christopher Stokes prosecuted.
Federal Court Sentences Wapello Man on Child Pornography ChargesRead the Press Release
DAVENPORT, IA - On March 28, 2014, Shannon Wade Watson, age 39, formerly of Wapello, Iowa, was sentenced by United States District Court Judge John A. Jarvey to 120 months imprisonment for possession of child pornography, announced United States Attorney Nicholas A. Klinefeldt. Watson was ordered to serve fifteen years of supervised release following the period of imprisonment, and to pay $100 towards the Crime Victims Fund. Watson will also be required to register as a sex offender.
In July of 2011, a Scott County Deputy and member of the Internet Crimes Against Children (ICAC) task force participated in an online investigation of the possession of child pornography. The deputy identified images of child pornography on a computer later identified as belonging to Shannon Wade Watson. On September 26, 2011, a search warrant was conducted at Watson’s Wapello residence, resulting in the seizure of the identified computer and related equipment. A forensic examination of a computer hard drive and two thumb drives identified over 300 images of child pornography. Watson pleaded guilty to possession of child pornography in November of 2013.
This case was investigated by the Scott County Sheriff’s Office, the Internet Crimes Against Children task force and the United States Secret Service Cyber-Crimes Unit. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
(Download Press Release )
Federal Court Sentences Former Davenport Man on Child Pornography ChargesRead the Press Release
DAVENPORT, IA - On March 28, 2014, Matthew Scott Hiles, age 29, formerly of Davenport, Iowa, was sentenced by United States District Court Judge John A. Jarvey to 70 months imprisonment for possession of child pornography, announced United States Attorney Nicholas A. Klinefeldt. Hiles was ordered to serve five years of supervised release following imprisonment, and to pay $100 towards the Crime Victims Fund. Hiles will also be required to register as a sex offender.
In April 2013, a Davenport, Iowa, police detective, and member of the Internet Crimes Against Children (ICAC) task force, conducted an online investigation and identified images of child pornography on a computer later identified to Hiles at his Davenport residence. As part of an April 26, 2013, search warrant this identified computer and computer equipment were seized from Hiles’s bedroom and determined by forensic examination to contain multiple child pornography images and videos. Hiles pleaded guilty to possession of child pornography in November of 2013.
This case was investigated by the Davenport, Iowa, Police Department, the Internet Crimes Against Children task force and the United States Secret Service Cyber-Crimes Task Force. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
(Download Press Release )
FBI Ten Most Wanted Fugitive Juan Elias Garcia Now in CustodyRead the Press Release
Garcia Capture Release
Edgewater, Maryland Man Pleads Guilty to Defrauding SBA Disadvantaged Small Business Program and IRSRead the Press Release
Fraudulently Obtained Over $52 Million in Government Contracts, Concealed Income by Transferring Millions from Corporate Accounts to Casinos and to Pay Other Personal Expenses,
and Filed False Tax ReturnsGreenbelt, Maryland - Vernon J. Smith III, age 61, of Edgewater, Maryland, pleaded guilty today to conspiring to defraud the United States in connection with schemes to fraudulently seek federal contracts under a Small Business Administration program to assist socially and economically disadvantaged small businesses; and to defraud the IRS.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Small Business Administration Inspector General Peggy E. Gustafson; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office; Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and General Services Administration Inspector General Brian D. Miller.
“Today’s guilty plea sends a strong message to those who lie to obtain preferences for federal contract awards,” said Inspector General Peggy E. Gustafson of the Small Business Administration. “With our interagency partners, SBA OIG will continue to pursue those who defraud the government by lying to gain access to federal set-aside contracts. We would like to thank the U.S. Attorney's Office for its leadership and professionalism throughout this investigation.”
“Corruption of the nature uncovered throughout the course of this investigation destroys confidence in the Government's ability to act as a fair and effective steward of taxpayer dollars. This plea today, demonstrates the commitment of the Defense Criminal Investigative Service and its law enforcement partners to prosecute fraud to the fullest extent of the law,” said Robert E. Craig, Special Agent in Charge, Mid Atlantic Field Office, Defense Criminal Investigative Service.
“Conspiring to defraud the government in a decade long scheme and filing false tax returns is unlawful,” said Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington DC Field Office. “Bringing individuals to justice, such as Vernon Smith, who intentionally engage in this type of activity in order to defraud the IRS, ranks high on the list of IRS- CI's enforcement priorities.”
“This complicated scheme boils down to lying and cheating to obtain government contracts,” said GSA Inspector General Brian D. Miller. “I appreciate the hard work of our special agents, law enforcement partners, and U.S. Attorney's Office.”
According to his plea agreement, Vernon Smith was an owner and officer of Capitol Contractors, which provided roofing and construction services, primarily to U.S. government agencies. On March 3, 1993, Capitol Contractors was certified to participate in the SBA’s Section 8(a) program, which provides assistance to socially and economically disadvantaged small businesses. The majority owner of Capitol Contractors was a Native American. A small business can only participate in the Section 8(a) program for nine years before it “graduates” from the program and is no longer eligible to obtain government contracts reserved for Section 8(a) program participants. Shortly before Capitol Contractors graduated from the program in March 2002, the majority owner sold his interest in the company to Vernon Smith, who became the company’s sole owner and managed the day-to-day operations of the company. Vernon Smith did not qualify as a socially and economically disadvantaged individual under the Section 8(a) Program.In August 1999, Vernon Smith arranged for Anthony Wright, an African-American who was a former roofer and project manager at Capitol Contractors, to form a new company to participate in the Section 8(a) program upon Capitol Contractors’ graduation from the program. On August 11, 1999, Wright incorporated Platinum One Contracting in Maryland. Wright was the president and 60% owner, and Smith’s son was vice president and owned the remaining 40% of the corporation. In reality, Vernon Smith exercised complete and undisclosed control over Platinum’s operations, including the day-to-day management and long term decision making for the company.
Vernon Smith admits that from August 1999 to June 2013, he conspired to defraud the SBA in several ways. For example, Smith directed Wright to submit an application to the SBA for certification in the Section 8(a) program which did not reveal that Vernon Smith: exercised control over the company; had previously supervised Wright; owned more than 10% of Capitol Contractors; and was related to an owner of Platinum. From May 2004 through April 2010, Vernon Smith also caused Platinum to submit annual updates to the SBA Section 8(a) program that contained false information, including that the company was controlled by a socially and economically disadvantaged individual, and that no non-disadvantaged member of Platinum’s management received compensation that exceeded that received by Wright. In fact, Vernon Smith controlled the company and Platinum’s payments to Vernon Smith and other corporate officers far exceeded payments received by Wright for 2004 through 2009. Based on the fraudulent application and annual updates, Platinum One received more than $52 million in contracts from the federal government under the Section 8(a) program, to which it was not entitled. The total loss to the government resulting from Vernon Smith’s illegal conduct, regarding the illicit profit he received by defrauding the SBA, and depriving a legitimate Section 8(a) contractor of such profit, is $6,194,828
In addition, Vernon Smith and a co-conspirator transferred millions of dollars from Platinum to bank accounts in their own names, to Capitol Contractors, to casinos on their own behalf; and to pay for personal expenses charged to Platinum One’s credit cards. These expenses included: extensive dental work, veterinary visits for pets, lavish vacations, and limousine transportation to casinos in Atlantic City, New Jersey, among others.
Vernon Smith admits that he signed false corporate and personal tax returns for 2005 and 2006. Smith knew that the cost of goods sold and payments to contractors reported on the corporate returns were false because almost all of that money was paid to, and for the benefit of, Smith at casinos. He also knew that the income reported on his personal income taxes omitted hundreds of thousands of dollars that Capitol Contractors had paid to, and for his benefit. As a result, Smith owed additional personal income tax to the IRS totaling $264,105, and Capitol Contractors owed an additional $574,911 to the IRS for tax years 2005 and 2006. The total tax loss resulting from the conspiracy to defraud the IRS is $839,016.
Vernon Smith faces a maximum sentence of five years in prison for the conspiracy. U.S. District Judge Paul W. Grimm has scheduled his sentencing for July 2, 2014, at 9:30 a.m.
Anthony Wright, age 42, of Bowie, Maryland, pleaded guilty on June 18, 2013, to his role in the scheme and is scheduled to be sentenced on June 23, 2014.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. 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.
United States Attorney Rod J. Rosenstein praised the SBA Office of Inspector General; Defense Criminal Investigative Service; IRS Criminal Investigation; and the GSA Office of Inspector General for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Gregory R. Bockin and Trial Attorney Kenneth C. Vert of the U.S. Department of Justice Tax Division, who are prosecuting the case.
District Man Sentenced to 11 ½ Years in Prison for Robbery and Burglary at Northeast Washington Gas StationMasked Defendant, and Two Others, Forced Their Way into Attendants’ Booth, Assaulted Attendant, and Stole over $700Read the Press Release
WASHINGTON – Arel Jennings, 30, of Washington, D.C., was sentenced today to a total of 11 ½ years in prison on charges of robbery, burglary, wearing a hood or mask, and possession of cocaine, U.S. Attorney Ronald C. Machen Jr. announced.
Jennings and co-defendants Kevin Barnes and James Wright were found guilty by a jury in the Superior Court of the District of Columbia, following a trial in October of 2013. Jennings was sentenced by the Honorable Franklin L. Burgess, Jr. Upon completion of his prison term, Jennings will be placed on five years of supervised release.
At prior proceedings, Barnes, 27, and Wright, 24, were sentenced to prison terms of 54 and 42 months, respectively, for their roles in the case. Both are also from Washington, D.C.
According to the government’s evidence, on Jan. 24, 2013, during the 11 p.m. shift change at a gas station in the 1300 block of Florida Avenue NE, Jennings, Barnes, and Wright, all wearing masks, forced their way into the attendants’ booth. The two attendants working the night shift were both recent immigrants to the United States.
One of the three assailants assaulted one of the attendants, and the three stole over $700 from the booth and fled. Members of the Metropolitan Police Department’s Robbery Intervention Program were patrolling in the area, and apprehended all three defendants within a few blocks of the station. As he was being arrested, Jennings threw $185 onto the ground. A subsequent search revealed that Jennings had four plastic baggies of cocaine.
Jennings was subject to enhanced sentencing penalties, due to his multiple prior felony convictions in the District of Columbia.
In announcing the sentence, U.S. Attorney Machen recognized the outstanding efforts of the detectives and officers from the Metropolitan Police Department, and particularly of the Robbery Intervention Unit, whose quick actions following the robbery were critical to the case. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorneys Chrisellen Kolb and Jean Sexton; Paralegal Specialist Todd McClelland; and Litigation Technology Specialist Leif Hickling, who provided assistance. Finally, he commended the work of Assistant U.S. Attorneys John Truong, who investigated and indicted the case, and James Ewing, who prosecuted the case at trial.
14-073Defendant who Fled During Trial for Drug Trafficking Sentenced to Seven Years in PrisonRead the Press Release
One of two King County residents who was convicted, in absentia, of Conspiracy to Distribute Ecstasy in 2009, was sentenced today in U.S. District Court in Seattle to seven years in prison, announced U.S. Attorney Jenny A. Durkan. HARDEEP SINGH, 23, formerly of Kent, Washington, failed to appear after the first day of trial. His co-defendant. Kaushal Kainth, 25, formerly of Renton, Washington, also failed to appear following the lunch break on the last day of trial. SINGH was arrested a year ago in Canada. At the time he was indicted, SINGH had legal status in the United States. He likely will be deported to his native India following his prison term. Kainth remains wanted by law enforcement. At sentencing today U.S. District Judge Richard A. Jones noted that the conspiracy was a “large scale operation involving large amounts of drugs that would have an impact on the lives of many in the community.”
According to testimony at trial and records filed in the case, Kainth and SINGH conspired to distribute large amounts of ecstasy. Over eight days in early May 2009, the men agreed to pay a third man to deliver large amounts of ecstasy and another drug, BZP, to co-conspirators at the Southcenter Mall in Tukwila, Washington and in San Jose, California. Kainth and SINGH did not know the man they offered to pay for the delivery was working with law enforcement. The man recorded both defendants on audio and video. In all Kainth and SINGH gave the person working with law enforcement some 285,000 pills worth more than $2.8 million. The pills were all seized by law enforcement.
The case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). The case was prosecuted by Assistant United States Attorney Brian Werner.
Defendant Pleads Guilty to Federal Offense of Sex Trafficking of A ChildRead the Press Release
Defendant Faces Imprisonment term of 10 years to Life
BINGHAMTON, NEW YORK - United States Attorney Richard S. Hartunian announced that Lynette Tilden, from Utica, New York, pleaded guilty today in federal court to an offense charging her with Sex Trafficking Of A Child.
In pleading guilty, Lynette Tilden admitted that in and about February of 2012, in the Broome, Oneida, and Onondaga counties in the Northern District of New York and elsewhere, defendant Tilden and others, aiding and abetting each other, while in and affecting interstate commerce, did knowingly recruit, entice, harbor, transport, provide, obtain, and maintain by any means a person with the initials M.L., who had not attained the age of 18 years, knowing, or in reckless disregard of the fact that M.L. would be caused to engage in one or more commercial sex acts, and did benefit, financially and by receiving things of value, from participation in the venture which has engaged in the act described above, in violation of Title 18, United States Code, §§ 1591(a) & (b) and 2.
Tilden further admitted that she and others, while aiding and abetting each other, knowingly recruited, enticed, harbored, transported, provided, obtained, and maintained a minor with the initials M.L., who was 16 years of age at the time, in order to prostitute M.L. to adult men in exchange for money and controlled substances. Tilden and the others photographed and caused M.L. to be photographed in sexually seductive poses wearing only lingerie and posted said photographs of M.L. on Backpage.com, an internet classified advertising website, offering M.L. for sex in exchange for money. Additionally, Tilden and the others utilized cellular telephones to send mass cellular texts offering M.L. for sex to customers in exchange for money. Furthermore, Tilden and the others transported and caused M.L. to be transported to various locations including hotels where M.L. was instructed and caused to engage in commercial sex acts, in that, M.L. engaged in sexual acts including intercourse and oral sex with customers in exchange for money and controlled substances. Tilden and the others benefitted, both financially and by receiving things of value, by prostituting M.L. to customers, in that, Tilden and the others shared the money and controlled substances acquired from customers with whom M.L. was caused to engage in sex acts.
The federal charge stems from an investigation conducted by the FBI-Albany Division, New York State Police, Oneida County District Attorney’s Office, Utica Police Department, and the Oneida County Child Advocacy Center. The investigation concerned a prostitution ring involved in selling a minor to engage in sexual conduct in exchange for money and drugs. The prostitution ring utilized the website Backpage.com to advertise the prostitution. The ring also utilized a texting network to advertise their prostitution business. The Oneida County District Attorney has charged several other defendants with state crimes in connection to this overall joint investigation. The investigation is continuing.
Tilden continues to be held in the custody of the U.S. Marshal’s Service pending sentencing. Tilden is scheduled to be sentenced on July 29, 2014. At sentencing, she faces a statutory mandatory minimum term of 10 years prison and a maximum of life. The maximum possible fine is $250,000.
Dallas Man Sentenced to Serve A Total of 300 Months in Federal Prison for Role in Conspiracies to Distribute Cocaine and MethamphetamineRead the Press Release
Defendant Also Convicted on Obstruction and Perjury Charges
DALLAS — A Dallas man who was arrested last summer as part of an Organized Crime Drug Enforcement Task Force (OCDETF) operation and later convicted at trial, was sentenced this afternoon by U.S. District Judge Reed C. O’Connor to serve a total of 300 months (25 years) in federal prison, announced U.S. Attorney Sarah R. Saldana.
Reynaldo Macedo-Flores, 35, was convicted on all five counts of the indictment, including one count of conspiracy to possess with intent to distribute cocaine; one count of conspiracy to possess with intent to distribute methamphetamine, one count of obstruction of justice and two counts of perjury. The obstruction and perjury convictions stem from Macedo-Flores’s false testimony at the trial of his mother, Austreberta Macedo-Flores, in September 2013, also before Judge O’Connor. (Austreberta Macedo-Flores was convicted of conspiring to distribute methamphetamine; her sentencing hearing is set for April 10, 2014.)
The government presented evidence at trial that Reynaldo Macedo-Flores repeatedly sold narcotics to an undercover officer, bragged about taking the risk of distributing narcotics on a wiretap, and plotted to present false testimony – and then did so – at his mother’s trial.
The eight remaining defendants in the case have been convicted; four have been sentenced.
The case involved undercover purchases, wiretaps and search warrants, and was investigated by the FBI in conjunction with the Dallas Police Department. In total, over 15 kilograms of cocaine, four and one-half pounds of methamphetamine (ICE), five firearms, four luxury vehicles and $351,010 in cash – much of it, as trial testimony showed, packaged for shipment to Mexico – was seized in the operation.
Assistant U.S. Attorneys Jason Schall and John Kull prosecuted the case.
Clinic Manager Sentenced for Receiving Misbranded BotoxRead the Press Release
St. Louis, MO – THOMAS GREG MARTIN was sentenced to six months of home confinement, 120 hours of community service and three years of probation for receiving misbranded Botox® from a foreign, unlicensed drug wholesaler, some of which had counterfeit exterior packaging. Additionally, as part of his earlier plea, he agreed to the forfeiture of $32,000.
According to court documents, Martin operated Aestheticare LLC, a medical clinic which provided assorted cosmetic procedures to patients in St. Louis County, Missouri. In March 2010, Martin received a facsimile transmission from an unlicensed drug wholesaler that offered low prices for assorted prescription drugs, including “Botox (Turkish)” for $344.99 a vial. During this same time frame, the FDA-approved version of Botox® was sold through licensed drug wholesales at higher prices in the United States, typically $525 a vial. From March 2010 through September 2012, Martin made over fifty separate purchases of these drugs from the unlicensed drug wholesaler. Ultimately, Martin and others provided the illegal drugs to the clinic’s patients without informing them of the source of the drugs. The U.S. Food and Drug Administration has recently issued a public safety alert regarding misbranded Botox®, found on the agency’s website at: http://www.fda.gov/drugs/drugsafety/ucm349503.htm
"Foreign-made prescription drugs that do not meet FDA standards for safety and effectiveness place all consumers at risk," said Patrick J. Holland, Special Agent in Charge of FDA’s Office of Criminal Investigations, Kansas City Field Office, "FDA's Office of Criminal Investigations will continue to protect the public's health by guarding against these illegal drugs."
Martin, of St. Louis, pled guilty last December to one felony charge of receiving misbranded drugs. He appeared today for sentencing before United States District Judge Rodney Sippel.
This case was investigated by the U.S. Food and Drug Administration, Office of Criminal Investigations.
Cambridge Man Indicted on Child Pornography ChargesRead the Press Release
BOSTON – A Cambridge man was indicted yesterday on child pornography charges.
James E. Schultz, 61, was charged with possession of child pornography and two counts of distribution of child pornography. The indictment alleges that in March 2014, Schultz possessed child pornography and that on various dates in 2013, he distributed visual depictions of minors engaged in sexually explicit conduct.
If convicted, Schultz faces a mandatory minimum term of five years in prison on the charge of distribution of child pornography, a maximum of 20 years in prison on the charge of possession of child pornography, a mandatory minimum of five years and a maximum of a lifetime of supervised released, and a $250,000 fine on each count.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement. Assistance was also provided by the Woburn Police Department. The case is being prosecuted by Eve A. Piemonte Stacey of Ortiz’s Major Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys= Offices and the Criminal Division=s CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Buffalo Man Pleads Guilty to Gun ChargeRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that John Rickard, 48, of Buffalo, N.Y., pleaded guilty to possession of a firearm in furtherance of drug trafficking, before U.S. Magistrate Judge Leslie G. Foschio. The charge carries a mandatory minimum penalty of five years in prison, a maximum of life, and a $250,000 fine.
Assistant U.S. Attorney Mary Catherine Baumgarten, who is handling the case, stated that on November 9, 2009, Buffalo Police officers executed a search warrant at the defendant’s residence, located at 254 Laird Avenue in Buffalo. During the search, officers located approximately 96 grams of cocaine, packaging material, approximately $58,307 in United States currency and three firearms. A Buffalo Police canine gave a positive alert for the presence of narcotics on the currency.
The plea is the culmination of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon, New York Field Division and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.
A sentencing date has not been scheduled.Bridgeton, N.J. Jersey Tax Preparer Admits Personal Income Tax EvasionRead the Press Release
CAMDEN, N.J. - A Bridgeton, N.J., tax preparer today admitted he knowingly failed to report more than $300,000 diverted from his tax preparation service for his personal use, U.S. Attorney Paul J. Fishman announced.
William Jones, 67, pleaded guilty before U.S. District Judge Robert B. Kugler in Camden federal court to an information charging him with one count of income tax evasion.
According to documents filed in this case and statements made in court:
Jones admitted that he operated Your Financial Services and PLM Tax Services, both Bridgeton businesses that provided tax return preparation and payroll services for their clients. Your Financial Services provided refund anticipation loans backed by Refund Advantage, a company that processed income tax returns and provided refund anticipation loans for smaller tax offices.
From 2007 through 2010, Jones offered Your Financial Services’ clients refund anticipation loans processed by Refund Advantage for which Jones received fees and additional yearly incentives. Since Your Financial Services was a Schedule C business, Jones was required to report the income generated by Your Financial Services on his U.S. individual income tax return.
However, for the years 2007, 2008, 2009, and 2010, Jones only reported to the IRS Form W-2 wages, property tax information, and interest and dividend income, omitting all of the diverted payments from Refund Advantage made to Your Financial Services. He admitted that he deposited the business receipts into his personal bank account and used the money for personal expenditures.
From 2007 through 2010, Jones admitted that he diverted a total of $310,248 in gross receipts of Your Financial Services into his personal bank account. He would have owed the government $90,266 in taxes had he reported the additional gross receipts on his income tax returns.
The charge to which William Jones pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. Sentencing is scheduled for July 1, 2014.
U.S. Attorney Fishman credited special agents of IRS-Criminal investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, for the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Jason M. Richardson of the U.S. Attorney's Office Criminal Division in Camden.14-108
Defense counsel: Christopher O’Malley Esq., Camden
Jones, William Information
Bridgeport Man Pleads Guilty to Role in Fraudulent Federal Tax Refund SchemeRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that CARLOS MATEO, 45, of Bridgeport, waived his right to indictment and pleaded guilty yesterday before U.S. Magistrate Judge Donna F. Martinez in Hartford to one count of theft of government property stemming from his role in a fraudulent federal tax refund scheme.
According to court documents and statements made in court, between November 2011 and February 2012, MATEO obtained fraudulent U.S. Treasury tax refund checks, ranging in amounts of approximately $4,000 to $8,150, which were addressed to different individuals with mailing addresses in Connecticut, New York, New Jersey and Florida. All of the Social Security Numbers used for the tax returns involved in the scheme belong to Puerto Rican citizens. MATEO provided the checks to Jeovany Rios, who cashed the checks at GE Credit Union branches in Bridgeport, Milford and Danbury with the assistance of Angel Castellano, a teller at the credit union. Rios then returned some of the cash to MATEO after taking a portion for himself and Castellano.
In total, MATEO provided Rios with 21 fraudulent tax refund checks totaling $137,860.70.
MATEO is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on June 20, 2014, at which time he faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
Rios, 39, and Castellano, 26, both of Bridgeport, previously pleaded guilty and await sentencing.
This matter is being investigated by the Internal Revenue Service – Criminal Investigation Division, and is being prosecuted by Assistant U.S. Attorney Sarala V. Nagala.
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[email protected]Bank Fraud Co-Conspirator Sentenced to Prison for Using Firearm to try to Collect DebtsRead the Press Release
A member of a bank fraud scheme who threatened people with a firearm to try to collect debts was sentenced today to six years in prison, announced U.S. Attorney Jenny A. Durkan. SON PHAM, 45, pleaded guilty in November 2013 to two counts of Attempted Collection of Extensions of Credit by Extortionate Means, one count of Bank Fraud, and one count of Carrying a Firearm During and in Relation to a Crime of Violence. SON PHAM admits he used threats of violence to collect debts and that he had arranged for one of his co-conspirators to be armed with a firearm while the threats were made. At sentencing U.S. District Judge Robert S. Lasnik ordered PHAM to pay $115,690 in restitution for the bank fraud scheme.
According to records filed in the case, PHAM conspired with ring leader Chi Ahn Nguyen in a scheme to defraud banks by running up credit card and cash advance debts that they never intended to repay. The men used the identities of others—many of whom participated in the schemeto access credit cards that he and others involved in the scheme used to purchase jewelry and other consumer goods or for cash advances at casinos. The men then took a share of the proceeds derived from those transactions. PHAM also loaned money to people in his community and then used threats of violence to try to collect the debts. In October 2012, PHAM arranged for one of his cohorts to be armed with a semi-automatic pistol when they confronted an associate of someone owing PHAM $10,000. The men claimed the victim was responsible for the other man’s debt; they surrounded him at the Macau Casino in Tukwila and demanded the money while brandishing the gun. In a second instance, also in October 2012, PHAM tried to collect a $2,000 debt by threatening to send people to the victim’s home to “cut him.”
The case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigation (HSI). The case is being prosecuted by Assistant United States Attorney Matthew Hampton.
Attorney General Holder Announces H. Marshall Jarrett to Retire from Executive Office for U.S. Attorneys; Monty Wilkinson Named as SuccessorRead the Press Release
WASHINGTON – Attorney General Eric Holder today announced the retirement of H. Marshall Jarrett, Director for the Executive Office for U.S. Attorneys (EOUSA) as well as the appointment of Monty Wilkinson as the new Director for EOUSA.
Prior to his appointment as Director for EOUSA in 2009, Jarrett served as Counsel for the Office of Professional Responsibility, as an Associate Deputy Attorney General, and as Deputy Chief of the Public Integrity Section of the Department of Justice. In addition, he served as Chief of the Criminal Division in the U.S. Attorney’s Office for the District of Columbia and as Criminal Chief and First Assistant U.S. Attorney in the U.S. Attorney’s Office for the Southern District of West Virginia.“For 39 years, Marshall has distinguished himself in the Department as an exceptional public servant and a principled leader. To me, personally, he has been a trusted mentor and a good friend,” said Attorney General Holder. “In the face of daunting staff and resource constraints, Marshall’s calm and steady leadership was exactly what EOUSA and the U.S. Attorney community needed over these past several years. His extraordinary contributions have left an indelible mark on the Department and the country will be forever grateful for his service.”
Wilkinson, whose appointment as Director for EOUSA will become effective on March 31, has held many significant executive-level positions in the Department. He most recently served as the Principal Deputy Director and Chief of Staff for EOUSA. Before arriving at EOUSA, he served as Counselor and Deputy Chief of Staff to the Attorney General and as an Associate Deputy Attorney General.
“Monty is a tremendous asset to the Department, and I am grateful he has agreed to take on this enormous responsibility,” said Attorney General Holder. “I look forward to continuing to work closely with him and the U.S. Attorneys as we continue our critical mission to provide justice for the American people.”
Antitrust Division Announces New Streamlined Procedure for Parties <br /> Seeking to Modify or Terminate Old Settlements and <br /> Litigated JudgmentsRead the Press Release
The Department of Justice’s Antitrust Division today announced a new streamlined procedure that will lower the costs and expedite the review process for parties seeking to modify or terminate old antitrust settlements and litigated judgments.
The new voluntary procedure, which is effective immediately, updates a 1999 protocol. The expedited process can be used by parties seeking to modify or terminate perpetual decrees–settlements and litigated judgments–entered prior to 1980.In 1979, the department determined that entering into perpetual decrees was not in the public interest. Since that time, decrees have included “sunset” provisions that will automatically terminate them after a term of years, not to exceed 10 years. Most decrees entered into before 1980 do not contain this provision.
“The new streamlined procedure will expedite the review process for legacy decrees and will benefit both the defendants and the department by eliminating costly and time intensive investigations,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The Antitrust Division will continue to look for ways to incorporate procedural efficiencies whenever possible as it is an important part of effective antitrust enforcement.”
Pre-1980 perpetual decrees cannot be terminated or modified except by court order. Since 1980, there have been significant changes in markets and technology and substantial changes in antitrust law. Going forward, the department will advise courts that pre-1980 “legacy” decrees, except in limited circumstances, are presumptively no longer in the public interest. Those limited circumstances may include when there is a long-standing reliance by industry participants on the decree.The updated procedure differs from the present procedure in two important ways. First, the party seeking termination or modification will no longer be subject to the extensive discovery that was required by the 1999 protocol. This should result in a substantial reduction in the cost of seeking decree termination. Second, when responding to a request to terminate or modify qualifying legacy decrees, the department will no longer conduct an in-depth investigation into the relevant markets due to the significant changes that have taken place. The updated procedure can be found in the Division Manual on the Antitrust Division’s website.
Under the protocol, the requesting party will publish, at its own expense, notice of its intent to seek termination or modification and invite interested parties to provide the Antitrust Division with relevant information. The division will work with the requesting party to determine what form of cost-effective notice is appropriate. Because the process is expedited, the division believes that a pre-filing public comment period best serves the public interest by allowing interested parties to come forward early in the process so that their concerns may be considered and addressed prior to the filing of a motion to modify or terminate. The division will take into account issues that are brought to its attention and address them as appropriate. Other parts of the 1999 protocol will remain in effect.
Another Defendant Sentenced in Identity Theft Tax Refund Fraud Scheme Involving Thousands of Patients’ Personal Identity InformationRead 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, and Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that defendant Marquis Onigirin Moye, 24, of Pompano Beach, was sentenced for his participation in a stolen identity tax refund scheme. Moye was sentenced to 54 months in prison, to be followed by three years of supervised release. Moye previously pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A.
Co-defendants Tiffany Shenae Cooper, 33, of Deerfield Beach, and Angela Dione Rosier, 41, of Coral Springs, were sentenced on February 28, 2014. Cooper was sentenced to 57 months in prison, to be followed by three years of supervised release. Rosier was sentenced to 49 months in prison, to be followed by three years of supervised release. The court also ordered both defendants to pay $129,390.06 in restitution to the IRS and the medical services provider whose database had been breached. Cooper previously pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A. Rosier previously pled guilty to one count of conspiracy to commit access device fraud, in violation of Title 18, United States Code, Section 1029(b)(2).
Co-defendant Michael Ali Bryant, Sr., 41, of Lauderdale Lakes, previously pled guilty to one count of possession of fifteen or more unauthorized access devices, in violation of Title 18, United States Code, Section 1029(a)(3), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A. Bryant’s sentencing is scheduled for April 11, 2014. At sentencing, the defendant faces a maximum of ten years in prison for the possession of unauthorized access devices charge, and a mandatory term of two years in prison, consecutive to any other term in prison, for the aggravated identity theft charge.
Michael Bryant's wife and co-defendant Latina Rashawn Bryant, 43, of Lauderdale Lakes, previously pled guilty to one count of using an unauthorized access device, in violation of Title 18, United States Code, Section 1029(a)(2), and one count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A. Sentencing is scheduled for April 10, 2014.
According to court documents, a confidential source (CS) initially approached Michael Bryant and inquired about purchasing narcotics. Bryant told the CS that he did not have any narcotics but that he did have personal identity information (PII) that he was willing to sell to the CS. The CS made a controlled purchase of ten pages (each page containing approximately 20 to 25 names) of PII. Bryant instructed the CS on how to commit tax fraud using the PII, and provided the CS with specific instructions on what information to enter into the web pages of the internet-based tax services to obtain a tax refund. An examination of the PII revealed that it was from a medical services provider.
Rosier was an employee of the medical services provider. Cooper spoke to Rosier to obtain user names and passwords for current employees of the medical services provider. Cooper admitted to illegally logging on to the medical services provider’s computer network and downloading PII for the purpose of committing various types of fraud. She was assisted in her activities by Rosier and co-defendant Moye.
Mr. Ferrer commended the investigative efforts of the FBI and IRS-CI. The case is being prosecuted by Assistant U.S. Attorney Cynthia R. Wood.
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.
Acting Assistant Attorney General for National Security John P. Carlin Delivers Remarks at the American University Business Law Review 2014 SymposiumRead the Press Release
Thank you for that kind introduction – and for inviting me here today. It’s a pleasure to be back at AU, and a privilege to join so many experts, essential partners, and good friends in advancing one of the most important conversations currently facing government and private sector leaders across the country.
At the Justice Department’s National Security Division, there is little we do that is more important than working on how the government can partner with private companies to protect our nation and its people better – from terrorism, from cyber attacks, and from a range of other malicious activities.
This past December, I attended a ceremony marking the twenty-fifth anniversary of the bombing of Pan Am Flight 103 over Lockerbie, Scotland, which claimed the lives of 259 people on the plane and 11 on the ground. 189 were Americans. It was the deadliest act of terror against the United States prior to September 11th.
The families and friends of those who were lost came together that winter day at Arlington National Cemetery to recall the event that changed their lives forever. They spoke movingly of loved ones who had been on board that plane, many of whom were American college students flying home for the holidays.
On December 21, 1988, instead of reuniting with their companions and loved ones, they heard news reports of a catastrophic explosion and wreckage strewn over miles of the Scottish countryside. Shortly thereafter, they learned, as did the rest of the world, that terrorists were to blame.
There was a call for justice – to find the perpetrators and hold them responsible. And there was also a call for new security measures designed to stop another attack from happening.
At the ceremony last winter, former Secretary of Labor Ann McLaughlin Korologos spoke of her experience leading the seven-member Presidential Commission on Aviation Security and Terrorism that was formed a few months after the attack to investigate what went wrong. Eighteen months after Lockerbie, that Commission issued a report calling for national attention to our aviation security system, and identifying a host of specific proposals intended to harden our nation’s airline security and keep all Americans safe – both at airports and in the skies.
Many of these measures did not become reality. Interest faded, attention waned – and so did political and social will. Twelve years later, the horror of 9/11 changed that. It reinvigorated the focus on aviation security – and the 9/11 Commission called for many of the same security measures called for in the wake of Lockerbie. This time, almost all of them were implemented.
Today, national leaders in both government and private industry must apply the lessons we learned from unspeakable tragedies like these, and from decades of effective counterterrorism policy, to business action in cyberspace. It is imperative that we take action promptly, without waiting for a galvanizing tragedy. We can work together to change norms now -- not in the wake of an immensely damaging terrorist cyber attack. In doing so, we will have a much better chance of preventing such an attack from ever taking place.
I grew up in New York City, a place where you can experience the anonymity now enjoyed by so many on the Internet. And when I was a kid, the NYPD sent an officer to our school who told us how to conduct ourselves on the streets of New York.
Our version of Officer Friendly told us to look both ways when we crossed the street. Of course, he told us not to make eye contact with people on the street -- which was pretty standard advice back then.
As a kid, that seemed to make total sense. Decades later, New York City is now one of the safest major cities on the planet. And when we look back at that advice, it seems crazy that there was a consensus of blaming the victim for making eye contact. These days, on the internet, we tell our kids to beware of chatting with individuals they don’t know, to avoid certain websites or apps.
When a person’s credit card gets stolen, or their credentials for accessing a social media site or their bank are hacked, we tell them, “You should have known better than to go to that website,” or, “You shouldn’t have used the same 18-character password more than once.” Together, hopefully, we can look back in a few short years and think that that those warnings and the victim-blaming is also strange and that we’ve come a long way with regards to cyber security.
One of the things that’s changed in New York over the years is its social norms – like making eye contact. We need to shape social norms in the cyber area, too. Just as it was in a chaotic urban environment, it’s tricky to cultivate trust in cyberspace. There were streets in New York where the bad guys and the good guys passed each other shoulder to shoulder. The same thing is true in cyberspace. Legitimate businesses and innocent customers use the same Internet that hackers and terrorists use.
As my former boss at the FBI, Bob Mueller, explained, bad actors – specifically terrorists – are using cyberspace for at least three discrete aspects of terrorist activity: (1) to propagandize and recruit; (2) to plot and plan attacks in the physical world; and (3) to launch attacks in the virtual world itself. It’s hard to cultivate trust online amidst such company and to restore a sense of security.
But like change in New York, change in cyberspace will be a community effort. When our Officer Friendly came to visit, he told us about Safe Havens – businesses that opened themselves up just a little bit, to be better members of the community, and to provide a place for people to go if they felt threatened. Back then, there were little yellow Safe Haven signs on the doors of stores in New York, and he told us, “If you’re feeling uncomfortable or scared, or are being targeted, don’t be afraid to go into one of these stores and seek help. Your safety should be your first priority.”Just as those Safe Havens existed as trusted businesses when I was kid, the government and the corporate community can come together to create safe havens in cyberspace.
We need to work together to prevent terrorists from using networks – using the very websites and apps we use every day – to plot attacks in the physical world. And we need to shore up our security so that devastating attacks cannot be launched in the virtual world. These tasks are not easy, and they are ones we need to undertake with care, to strike a proper balance between security and liberty.
Some businesses, especially those in the communications sectors, may be hesitant to build new partnerships with government – or are drawing back from their current partnerships – because of the national discussion that has taken place over the last year.
The President has committed to providing greater transparency about the government’s lawful use of data collection authorities. However, as the President has noted, the nature of some unauthorized disclosures have shed more heat than light. And that heat has come onto companies as well, often unfairly. We take their concerns seriously, and we are dedicated to increasing transparency as well as protecting civil liberties. That is why many layers of checks and balances are built into the systems – without question some of the best protections provided by any country in the world. Our authorities are rigorously overseen by Congress, and often scrutinized by the courts and independent government watchdogs. And they are aimed at ensuring the safety of the nation and our allies.Of course, the private sector should not be punished for complying with the law. We are concerned about this issue, and we are dedicated to working with companies to address misconceptions, correct misinformation, and help to rebuild the public’s confidence that our partnerships are conducted under the law. We are working with industry to help them be more transparent about what kinds of information they are required to share with the government, and how very few of their customers are ever impacted by government actions.
Yesterday’s announcement by the President of a way forward on the handling of telephony metadata indicates just how committed the Government is to ensuring that the public’s concerns are addressed, without the Government sacrificing certain operational needs. As you might have heard, the President announced a proposal that will, with the passage of appropriate legislation, allow the government to end bulk collection of telephony metadata records under Section 215, while ensuring that the government has access to the information it needs to meet its national security requirements.
Getting our legal policies right is one thing. But make no mistake: It will lead to tragedy if the ultimate result of these disclosures is to cause businesses to shy away from working with the government to prevent terrorism. The undeniable truth is that our collaboration, and the protections we have put in place together, make us safer from those who would attempt to do us harm – from terrorists to hostile nation-states seeking to capitalize on our vulnerabilities.
One example that comes to mind is the case of Khalid Aldawsari, a college student from Saudi Arabia who took chemistry classes at Texas Tech in Lubbock, Texas. When he began placing large and unusual orders for chemicals online, the chemical company reported the order to the FBI, as did the shipping company. Ultimately, he was convicted in federal court and sentenced to life in prison for trying to use those chemicals to make a bomb, potentially to attack a former President. And heading off that threat all began with two companies taking the right step of alerting the FBI to suspicious activity.
Whenever the public faces a threat, whether from terrorists, computer hackers, or pick-pockets on the Metro, people expect the government to protect them. But the government can’t do it alone. And that is particularly true in the context of cyber threats, given just how much of our nation’s most essential information is found online and, in particular, in the hands of private companies.
You know the threats we face. You’ve seen them firsthand. Although we often think of the government and our brave men and women serving abroad as a primary focus of terrorist attacks, we must keep in mind that the 9/11 attacks targeted this nation as a whole, and its impact was felt by all of us.
Since then, terrorism is now increasingly diverse and decentralized, from al Qaeda affiliates overseas to homegrown terrorists – such as the Boston Marathon bombers – who may live in the communities they intend to strike. But the cyber threat is growing rapidly, and down the road, may rival or even surpass the threat we face today.
Malicious cyber actors are an increasing risk to our security and prosperity. Last year, BP’s CEO stated that his company sees approximately 50,000 attempted cyber intrusions each day. And he is not alone.
As you know, hackers – in many cases working for foreign states or organized criminal syndicates – break into private businesses’ servers and steal the key intellectual property that gives us a competitive edge in the global marketplace. And malicious cyber actors sometimes target companies’ infrastructure. In 2012, Saudi Arabia’s state oil company, Aramco, suffered an attack that destroyed 30,000 of its computers – nearly 75% of its workstations, a devastating loss for any company.
Many of these same hackers exploit vulnerabilities in software, turning home computers or servers into launch pads for malicious denial-of-service attacks against banks, companies, and government agencies – shutting them down and disrupting their ability to do business. It does not take much imagination to see how these same tools could be used by terrorists, resulting in what has been referred to as a potential “cyber 9/11.”
When these attacks happen, people ask the same two basic questions many asked after the Lockerbie bombing: “What more could have been done to protect me?” And, “are they going to get these guys?” To answer these questions, we need the private sector and the government to work together.
Intrusions by nation-states have gone on longer than acknowledged. Why are so many companies waiting to come to the government for help? This situation is not unlike the way that organized crime was able to intimidate small businesses into paying for so-called “insurance” . For each mom and pop store, individually, it made more sense to pay the insurance rather than face retaliation for speaking up or going to the cops. And as a result, the criminal organizations made big profits. They only took a small amount from each business, but the money added up over the dozens or hundreds of businesses they intimidated. It wasn’t until the cost of doing business with the mafia got too high – or someone was brave enough to stand up to the mob – that law enforcement was able to break up these organized crime rings.
The calculus that many businesses make today is similar to the decisions that the mom and pop stores had to make several decades ago: Does the cost of paying out – that is, failing to tell the authorities about cyber attacks – outweigh the costs of potential retaliation? When faced with the prospect of taking on a nation-state with all of its powers – not to mention the fear of not being able to do business in that’s nation’s marketplace – many companies have made the calculation of remaining silent.
But the cost of that silence is increasing. As valuable assets, proprietary information, and research and development investments are repeatedly compromised by increasingly relentless attacks, businesses can no longer afford to stay silent victims. The calculus has changed. Companies are taking action.Over the last year, we have seen a tipping point. As more and more companies come forward, more and more will feel emboldened. Eventually, these nation-state hackers – just like the mafia – will lose the ability to intimidate victims.
Public-private partnerships are particularly important because of the key role that businesses play in our society. Unlike some countries, where government maintains control over the telecommunications and energy industries, nearly all critical infrastructure in the United States is owned and managed by private companies. The fiber-optic cables that our communications transit; the servers that direct our Internet traffic; the software that allows us to communicate; and the energy we use to power our daily lives – all of these things, and so many more, are created and operated by private companies.We thrive as a nation because of private innovation, and the creativity that comes with the freedom to innovate. This has been true throughout our history. But these unique strengths also create opportunities for attacks. When attacked, companies are often in the best position to protect themselves and their customers from cyber aggressors. But they may not always be in the best position to know the precise threats they face, which is where we can help.
Take, for example, the Department’s work on cyber threats. On a daily basis, the FBI is working with companies that have been the victims of hacks – many of whom may not even know they have been victimized, or how to protect themselves. The Washington Post reported earlier this week that federal agents notified more than 2,000 U.S. companies last year that their computer systems were hacked – and, as the article explained, even that considerable figure represents only a fraction of the actual number of cyber intrusions into the private sector.
There are many efforts underway across the government to work with private corporations on strengthening public-private cyber cooperation. The Department of Homeland Security, the Department of Energy, and other departments and agencies routinely work closely with companies to protect critical infrastructure.
In driving this work forward, the FBI has long relied on its InfraGard program, which brings together individuals in law enforcement, government, the private sector, and academia to talk about how to protect our critical infrastructure. InfraGard has more than 85 chapters across the country, with more than 47,000 members.
These are all positive and important efforts, but we have to do more.
As we speak, the Department of Justice is working hard to be a more accessible partner to companies. Over the past two years, the National Security Division established a national program to focus on cyber threats to the national security – those posed by terrorist and nation state actors – and we are continuing to grow. We are still a very new Division, but we are evolving quickly to meet new and emerging threats.
The story of NSD’s creation is an interesting one. Although not formally created until 2006, NSD’s story begins, like so many others, with calls for reforms that were first spotted years ago. We trace our origin all the way back to 1978, with the passage of the Foreign Intelligence Surveillance Act. FISA was, in part, a response to public and congressional dissatisfaction with a series of intentional abuses of wiretaps and surveillance for political purposes. The Church Committee’s report set out those problems and made a case for reform. The report emphasized that the Attorney General, as the nation’s chief legal officer, plays an essential role in maintaining the lawfulness of actions by our country’s intelligence agencies. NSD was created, and is proud, to execute that mission decades later on his behalf.
So as we tackle the cyber threat, we build upon our roots. We were created so that prosecutors and law enforcement officials could work smoothly and effectively with intelligence attorneys and the Intelligence Community, to ensure that we most effectively defend our nation’s security while at the same time protecting our vital civil liberties. And I would be remiss in describing the vital work of our Division if I neglected to acknowledge this week’s conviction of Sulaiman Abu Ghayth in New York. Abu Ghayth, described as a senior spokesman for Osama bin Laden and al Qaeda, was convicted by a federal jury on all counts, including conspiring to kill Americans and other terrorism charges.
So, even as we defend our national security through successful counterterrorism prosecutions in federal court, we also defend our security while protecting our civil liberties in cyberspace. In 2012, we established the National Security Cyber Specialists’ Network, with members from across all of our areas of expertise, federal prosecutors from each and every U.S. Attorney’s Office, and partners from the Department’s Computer Crime and Intellectual Property Section, who have had longstanding and continuing success against organized cyber criminals, hacktivists, criminal fraudsters and other bad actors.
Since then, we have hosted extensive training for these network members and for every member of the National Security Division, to ensure we have the skills we need to tackle the threat. Federal prosecutors across the country are reaching out to companies in their districts to let them know about the network and how we can help.
Here in our nation’s capital, we work closely with the FBI’s National Cyber Investigative Joint Task Force to assess cyber issues in real time as they arise. We’ve launched a 24/7 cyber response capacity. We are now a one-stop shop and resource for national security cyber matters across the country.
There are criminal cases to be brought against these actors, but that is just one tool. We are committed to using every tool at our disposal, law enforcement and others, to disrupt adversaries’ activities and prevent damage to U.S. national interests – just as we do in other arenas of counterterrorism, counterespionage, and export control.
We are drawing from our expertise in those areas, and building new capabilities to ensure that we can use all available tools to meet a range of constantly-evolving threats.
Employing this comprehensive, “all-tools” approach means we need to be prepared not only to prosecute cyber intrusions, economic espionage, and export control violations, but also to work with our partners to enforce other civil and regulatory laws.
We cannot do this alone. This “all-tools” approach requires trusted collaboration, including with operational and legal experts in the private sector.
It’s often said, there are only two types of companies: those that have been hacked and those that will be. Now, that’s no longer the case. Today, there is only one category: those that have been hacked, and that will be hacked again.
Going forward, we want to work even more closely with our private sector partners to be ready for whatever may happen in the near future. Of course, private companies will remain our first line of defense, and their legal teams must be prepared to face difficult questions and complex matters, including how to respond to cyber breaches; how to interpret and comply with the cyber Executive Order and the cybersecurity framework recently released by the Administration; and, how to stay on top of the evolving “standard of care” for cyber security.
All of us – including lawyers and operators in the public and private sectors – will need to cooperate closely to address these and associated threats. We all must act on the premise that success requires reporting from, and close relationships with, victims and potential victims who seek indicators of malicious activity.
My colleagues and I have already met with a number of private entities and received a positive response, and we will continue these meetings to keep the dialogue going.
And as we look toward the future, we must continue establishing channels that regularly communicate cyber threat information between the public and private sectors. Information must move in both directions. It is an approach that works in other contexts, and it will succeed here as well.
We have come a long way in our collective approach to counterterrorism. Together, we have improved airline safety, hardened critical infrastructure, developed new technology that can help first responders, and designed a wide range of protective measures. These measures, of course, don’t eliminate the threat of to our national security, which remains very real and very dangerous. But we are safer than we used to be, and better prepared to cope with any potential attack.
We need to achieve this same success in the cyber realm. So the critical question is: What will it take?
We’ve certainly had plenty of attacks that caused real pain, exposed real weaknesses, and suggested real problems for the future. Yet, despite all of these warnings, we don’t seem to have fully turned the corner in addressing this threat. And the reasons for that are understandable.
Confronting cyber threats incurs real economic cost. We appreciate that. But doing nothing will cost us all more in the long run, and may, for some businesses, prove devastating.
The writing is on the wall – our adversaries are getting bolder, more aggressive, and more skilled. They flex their muscle to show us what they can do, but it is only the tip of the iceberg. Without a concerted, collective effort to make the changes needed to protect ourselves in cyberspace, it is only a matter of time before we are really hit – hard. Far better to form partnerships and make the required investments before a large-scale attack takes place.
Indeed, perhaps even more than in the terrorism context, the private sector is critical to our success in the cyber context because of just how much vital information is now held “in corporate trust,” so to speak.
While government holds and protects some of what cyber terrorists want to access, the private sector has much, much more. So, whether it’s about ensuring that our electric grid is safe from attacks – whether physical or cyber – or making sure you can access your bank account information on your smartphone without getting hacked, we urgently need to form the type of public-private partnerships to keep those vital resources safe. These are the type of partnerships we’ve created for counterterrorism. We must build on those partnerships to combat cyber threats – not pull away from each other.
This is the challenge now before us – and this is the cause that everyone in this room, and many beyond it, must come together to confront. Each of us has a unique role to play, and distinct responsibilities to fulfill.
Leaders in government can articulate precisely what we have to offer the private sector. Leaders in the private sector can demonstrate what these partnerships have to offer to their customers. And leaders in academia can survey the legal authorities we have – and take stock of what legal authorities we don’t have but need – to facilitate cooperative, productive cyber partnerships. We can build these partnerships while respecting civil liberties and do it in a transparent and productive way.
We are committed to meeting regularly with critical partners to get your feedback on how we are doing; to solicit suggestions on how we can do better; and to gain the benefit of your views on how the overall landscape is looking. Please reach out to us so that we can talk more about what NSD does, and how we can work together to keep you safer and our nation safer.
I want to close today by calling upon everyone here to continue the important open dialogue we’re holding here at AU today. I urge you to serve as connectors – as bridges – to make private-public partnerships a reality.
We had warnings before 9/11. But we didn’t act – at least not enough. The state of security of the Internet today is a rumbling storm in the distance. We need to be smart and work together, now, before a cyber 9/11 – before there’s an attack or intrusion or exfiltration so big – and so devastating – we are forever changed. Thank you for participating in this important conversation, and thank you for having me here today.
Thursday 27 March 2014
Youngstown Woman Indicted for Insurance-Fraud ArsonRead the Press Release
A three-count indictment was filed charging a Youngstown woman with setting fire to a rental property in order to collect insurance money, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Latasha Curtis, 33, of Youngstown, Ohio, faces with one count of conspiracy, one count of use of fire during the commission of a felony, and one count of maliciously damaging and destroying, and attempting to damage and destroy, by means of fire, real property used in interstate commerce and in activity affecting interstate commerce
The indictment charges that Curtis, along with others made known to the Grand Jury but not indicted, conspired to commit arson of a rental property located at 75 Hilton Avenue in Youngstown, and to commit wire fraud in submitting false claims against State Farm Insurance Corporation for the proceeds of an insurance policy on the property.
The property was burned in a fire occurring on October 19, 2013, which was intentionally set by Curtis and others, according to the indictment.
State Farm paid $67,916.10 after the insurance claim on the property was submitted, according to the indictment.
If convicted, the defendant’s sentence will be determined by the court after review of the federal sentencing guidelines and factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offenses and the characteristics of the violations.
This case was investigated by the Youngstown Resident Agency of the Federal Bureau of Investigation, and is being prosecuted by Assistant U.S. Attorney James V. Moroney.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Youngstown Man Charged with Failing to Register as Sex OffenderRead the Press Release
Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, today announced that a federal grand jury sitting in Cleveland, Ohio, returned a one-count indictment charging Roland Fink, age 40, of Youngstown, Ohio, with failure to register as a sex offender.
The indictment charges that from on or about January 20 to February 27, 2014, Fink failed to register as a sex offender as required under the Sex Offender Registration and Notification Act, after having traveled in interstate commerce.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the United States Marshals Service. The matter is being prosecuted by Assistant United States Attorney David M. Toepfer.
An indictment in only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
West Mifflin Woman Sentenced to Prison for Conspiring to Launder Heroin Trafficking ProceedsRead the Press Release
PITTSBURGH – Lori Page, a resident of West Mifflin, Pa., was sentenced to 24 months in prison for conspiring to launder heroin trafficking proceeds, United States Attorney David J. Hickton announced today.
Page, 30, was sentenced by United States District Judge Nora Barry Fischer. Judge Fischer also imposed a three-year term of supervised release to follow the prison sentence.
In 2012, Page laundered thousands of dollars of heroin trafficking proceeds through her bank account and through payments to rental car companies and knowingly facilitated interstate heroin trafficking in doing so. She did it in return for money, expensive shoes, clothing, and related accessories. In addition, testimony during the sentencing hearing established that, during 2010 and 2011, Page served as a matchmaker between an out-of-state heroin source of supply and Pittsburgh heroin dealers. She was compensated for doing so.
Assistant United States Attorney Craig W. Haller prosecuted this case on behalf of the United States.
The Drug Enforcement Administration in Pittsburgh and New York, the Pennsylvania State Police, the Pittsburgh Bureau of Police, the Allegheny County Police Department, the Pennsylvania Attorney General's Office, the Wilkins Township Police Department, the East Pittsburgh Police Department, the New York Police Department, the Blair County District Attorney's Office, and the Allegheny County District Attorney's Office conducted the investigation leading to the conviction and sentence in this case.
Two Men Plead Guilty to Fraud Conspiracy in Connection with Renovation of McCormack Federal BuildingRead the Press Release
BOSTON - Two men pleaded guilty yesterday to conspiring to defraud the government in connection with the renovation of the John W. McCormack Post Office and Courthouse in Boston.
Wael Isreb, 55, of Wrentham and Aluisio Dasilva, 67, of Hudson, Mass., pleaded guilty before United States District Court Judge George A. O’Toole, Jr., to conspiracy to commit mail fraud and false statements. Isreb and Dasilva are scheduled to be sentenced on July 17 and 15, respectively.
Isreb operated Taunton Forms, a now-defunct concrete construction company based in Lakeville, Mass. DaSilva was employed by Taunton Forms as a cement mason. In 2006, the Government Services Administration (GSA) retained Suffolk Construction Company as the general contractor to renovate the McCormack Building. Suffolk Construction, in turn, retained Taunton Forms as a subcontractor to perform certain concrete work on that project. Suffolk Construction ultimately paid Taunton Forms in excess of $1 million for its work.
Federal law requires that contractors on federal projects over $2,000 pay workers a prevailing wage, and that they submit weekly reports certifying the wages they paid their employees. Beginning in December 2007, however, Isreb, DaSilva and others conspired to pay Taunton Forms workers less than the prevailing wage while certifying to Suffolk Construction, the GSA, and the United States Department of Labor (DOL) that Taunton Forms was, in fact, paying the prevailing wage.
As part of the conspiracy, the defendants agreed to report, falsely, to the Massachusetts Department of Unemployment Assistance (DUA) that DaSilva and other workers had been laid off. That permitted the workers to offset their lower wages with unemployment benefits while they worked on the McCormack Building project and other projects. The conspiracy also permitted Taunton Forms to avoid making fringe benefit payments to certain labor union benefit plans that it was required to pay pursuant to its applicable collective bargaining agreements. Taunton Forms also failed to withhold applicable payroll taxes.
The maximum sentence under the statute is five years in prison, three years of supervised release and a fine of $250,00 or twice the gross gain or loss. Pursuant to their plea agreements, Isreb and DaSilva are also required to pay restitution to the government and the labor unions that were defrauded as a result of the conspiracy.
United States Attorney Carmen M. Ortiz; Cheryl Garcia, Acting Special Agent in Charge of the U.S. Department of Labor, Office of Labor, Office of Inspector General, Labor Racketeering and Fraud Investigations, New York Regional Office; Luis A. Hernandez, Special Agent in Charge of the U.S. General Services Administration, Office of Inspector General, Office of Investigations; Susan A. Hensley, Regional Director of the Employee Benefits Security Administration, U.S. Department of Labor, Boston Regional Office; and William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement today. The case is being prosecuted by Assistant United States Attorney Stephen E. Frank of Ortiz’s Economic Crimes Unit.
Two Men Indicted for Their Role in Manufacturing PCP That Led to ExplosionRead the Press Release
ATLANTA - Adrian Banks has been arraigned on federal charges relating to the manufacture of PCP which led to a dangerous house fire when the clandestine laboratory exploded. Coleman Warnock, a second defendant named in the indictment, is being sought by law enforcement.
“An entire neighborhood was put at risk by the explosion of this PCP lab,” said United States Attorney Sally Quillian Yates. “This type of drug also puts our entire community at risk. Thankfully, this lab is out of business and our citizens in that neighborhood are safe.”
Harry S. Sommers, the Special Agent in Charge of the DEA Atlanta Field Division commented on the case, “These volatile chemicals are venomous to the consumer and leave behind a trail of devastation and destruction by those who manufacture it, as was the case in this investigation. Because of the collective efforts of local, state and federal law enforcement, these defendants will have to face the consequences of their unlawful acts.”
“Not only were these men putting dangerous drugs on the street, they were also endangering completely innocent people by operating a PCP lab in a neighborhood,” said Georgia Bureau of Investigation Director Vernon Keenan. “We will continue to work with our local and federal partners to insure people who endanger the lives of others are held accountable.”
According to United States Attorney Yates, the charges and other information presented in court: On July 6, 2013, Fulton County Fire/Rescue responded to a citizen’s call about a house fire in a Fairburn, Ga., neighborhood. The house was destroyed after burning for almost two days. Further investigation revealed the presence of numerous barrels and canisters of chemicals suggesting the presence of a large, clandestine, PCP lab in the residence. No one other than the individuals involved in the manufacture of PCP was harmed in the fire.
On January 14, 2014, a federal grand jury returned an indictment against the defendants, Coleman Warnock, 41, of Powder Springs, Ga. and Adrian Banks, 39, of Atlanta, Ga., charging them with one count of conspiracy to manufacture PCP, four counts related to the manufacture of at least one kilogram of PCP, and one count of creating a substantial risk of harm to human life while attempting to manufacture PCP.
On January 16, 2014 Adrian Banks was arrested and has been detained. Coleman Warnock remains a fugitive. If anyone has any information on Warnock’s whereabouts please contact the DEA at (404) 893-7000.
Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.The Drug Enforcement Administration is leading the investigation of the case. The Georgia Bureau of Investigation, Fulton County Fire/Rescue, Fulton County Police, Fulton County Fire Department Hazmat Team, SWS Environmental Services, the Georgia State Fire Marshal’s Office, the Atlanta Fire Department, and the Atlanta Fire Department Clandestine Laboratory Enforcement Team have also been involved in the clean-up of the residence and investigation of the case.
Assistant United States Attorney Vivek Kothari is prosecuting the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Two Charged with Robbing Soft Pretzel CompanyRead the Press Release
Donte Camp, 41, of Philadelphia, and Calvin Maurice Clark, 43, of Bensalem were charged today by indictment with robbing the Center City Soft Pretzel Company, in Philadelphia, on October 29, 2013, announced United States Attorney Zane David Memeger. The indictment charges each defendant with one count of robbery which interferes with interstate commerce, one count of using and carrying a firearm during a crime of violence, and one count of being a convicted felon in possession of a firearm.
If convicted, each defendant faces a mandatory minimum of seven years in prison with a maximum possible sentence of life imprisonment, a $750,000 fine, five years of supervised release, and a $300 special assessment.
The case was investigated by Federal Bureau of Investigation, the Philadelphia Police Department, and the Philadelphia County District Attorney=s Office and is being prosecuted by Assistant United States Attorney Jeffery W. Whitt.
Click here to view the indictment
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Title of the News Release Goes HereRead the Press Release
Orlando, Florida - U.S. District Judge John Antoon, II sentenced Lavitress Williams (33, Orlando) to 5 years, and three months in federal prison for her role in a counterfeit traveler’s check scheme. She was also sentenced to 5 years of supervised release and ordered to pay $44,728.33 in restitution to Target. Williams pleaded guilty on January 4, 2012.
According to court documents and evidence presented at the trial of a co-defendant, Williams was involved in a conspiracy and scheme by which counterfeit traveler’s checks were passed at Target stores located throughout the Southeastern United States. Other conspirators manufactured the counterfeit traveler’s checks, which Williams and other conspirators used to purchase merchandise at various Target stores. Williams and her conspirators would take the fraudulently obtained merchandise to different Target stores, where the merchandise would be returned for cash refunds. They would then divide the cash amongst themselves. From September 2011 to December 2011, Williams and her conspirators passed over 100 counterfeit checks, at over forty Target stores, located in six states. The scheme resulted in a loss to Target of $44,728.33.
Williams is one of six individuals who has been prosecuted for their role in this conspiracy and scheme. The following are the sentences of the other five individuals:
Name Charges Sentence Lottie Davis Conspiracy, two counts of bank fraud, and four counts of making, passing, or possessing counterfeit securities20 months in federal prison and 3 years of supervised release
Bank fraud 18 months in federal prison and 3 years of supervised release Darrel Dopson Conspiracy and bank fraud Time served and 3 years of supervised release Brandy Hooks Conspiracy 3 years probation Larry Wilson Conspiracy 3 years probationThis case was investigated by the United States Secret Service. It was prosecuted by Assistant United States Attorney Roger B. Handberg.
Three Youngstown-area Men Face Federal Firearms ChargesRead the Press Release
Three men from the Mahoning Valley were each indicted on one count of being felons illegally in possession of firearms and ammunition, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The cases are not related.
Darryl L. Lee, 25, of Youngstown, Ohio, was in possession of a Kel-Tec, model PF-9, 9mm pistol, and ammunition, on or about January 30, 2014, despite Lee having been previously convicted of aggravated assault, in the Mercer County, Pennsylvania, Court of Common Pleas, according to the indictment.
Alex C. Green, age 28, of Campbell, Ohio, was in possession of a Raven Arms, model P-25, .25 caliber pistol, a DPMS, model A-15, .223 caliber rifle, and ammunition, on or about February 18, 2014, despite Green having been previously convicted of being a felon in possession of a firearm in the U.S. District Court for the Northern District of Ohio, and of felonious assault, in the Court of Common Pleas, Mahoning County, Ohio, according to the indictment.
Whittington R. Davis, age 27, of Youngstown, Ohio, was in possession of a Bryco Arms, model 48, .380 caliber pistol, and ammunition, on or about February 1, 2014, despite Davis having been previously convicted of possession of cocaine, in the Mahoning County, Ohio, Court of Common Pleas, according to the indictment.
The Lee case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Youngstown Police Department and the Adult Parole Authority. The Green case was investigated by ATF and the Campbell Police Department. The Davis case was investigated by ATF and the Warren Police Department.
The cases are being prosecuted by Assistant United States Attorney David M. Toepfer.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Third Person Charged for Discharging Waste Related to Oil and Gas Drilling into the Mahoning RiverRead the Press Release
A third person has been criminally charged for discharging brine and wastewater related to oil and gas well drilling into the Mahoning River, law enforcement officials announced.
Mark A. Goff, 46, of Newton Falls, Ohio, was charged with one count of making an unpermitted discharge in violation of the Clean Water Act.
The conduct took place between October 1, 2012 and November 12, 2012, according to the information.
The filing of the criminal information was announced by Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, Ohio Attorney General Mike DeWine, James Zehringer, Director of the Ohio Department of Natural Resources, Craig W. Butler, Director of the Ohio Environmental Protection Agency, and Randall K. Ashe, Special Agent in Charge of the U.S. Environmental Protection Agency.
According to the information and related court documents:
Hardrock Excavating LLC is owned by Lupo and located at 2761 Salt Springs Road, in Youngstown, Ohio. The company provides services to the oil and gas industry in Ohio and Pennsylvania, including the storage of brine and oil-based drilling mud. There were approximately 58 mobile storage tanks at the facility and each holds approximately 20,000 gallons.
Lupo, who owns Hardrock, directed employee Goff to empty some of the waste liquid stored at the facility into a nearby wastewater drain on or about October 1, 2012, according to the information.
Lupo directed Goff to conduct this activity only after no one else was at the facility and only after dark, according to the information.
Goff, at the direction of Lupo, emptied some of the lighter phase of the waste liquid being stored at the facility into the nearby stormwater drain using a hose on numerous occasions over the next two months, according to the information.
The last time Goff emptied some of the lighter phase of the waste liquid being stored at the facility into the drain was on or about November 12, 2012. In total, Goff emptied tanks at the direction of Lupo on approximately nine different nights, according to the information.
“Those who make it their business to harvest from under Ohio its great natural resources, have a responsibility to the men, women and children who drink its water, live on its land and breathe its air. And they have a duty to follow the law,” Dettelbach said. “This defendant broke the law and must be held accountable.”
“Mark Goff is another individual who carried out orders to release contaminated brine into Ohio’s waterways. It is crucial to the safety of our communities that everyone involved in this heinous crime be held accountable for their actions,” DeWine said.
“This incident is one of a small percentage of egregious environmental violations we see at Ohio EPA that must be prosecuted criminally,” Ohio EPA Director Craig Butler said. “This general disregard for the law will not be tolerated in Ohio and we will work with our partners at the local, state and federal agencies to make sure the responsible parties are held accountable. We especially appreciate the Federal Department of Justice quickly assisting Ohio in this case and applying its more stringent laws regarding Clean Water Act violations. ”
“Knowingly discharging toxic waste byproducts from drilling operations that ultimately flow into rivers has serious consequences for natural resources and local communities,” said Randall Ashe, Special Agent in Charge of EPA’s criminal enforcement program in Ohio. “Actions like these threaten to turn America’s waterways into chemical dumping grounds. Today’s charge should help protect the Ohio River watershed by deterring other would-be violators.”
This case is being prosecuted by Special Assistant U.S. Attorney Brad Beeson following an investigation by the Ohio EPA, Ohio Department of Natural Resources, U.S. EPA, the Ohio Bureau of Criminal Investigation, the Youngstown Department of Public Works and the Youngstown Fire Department.
The statutory maximum for violating the Clean Water Act for individuals is three years in prison, one year of supervised release and a fine of $50,000 per day of violation or $250,000, whichever is larger.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record (if any), the defendant’s role in the offenses and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Tampa Man Pleads Guilty to Check Kiting SchemeRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III announces that Johnathan Bergren (40, Tampa) today pleaded guilty to conspiracy to commit bank fraud. Bergren faces a maximum penalty of 30 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, from at least September 2012 through August 23, 2013, Bergren, Christian Morales, and others engaged in a conspiracy to commit bank fraud by engaging in a check kiting scheme. Bergren, Morales, and others recruited by Bergren, engaged in the scheme to defraud by opening up numerous business checking accounts at federally insured financial institutions. Once the co-conspirators established the business checking accounts, they deposited checks drawn on accounts opened at other institutions into the newly established accounts. The conspirators then withdrew funds prior to the checks clearing the banks. The deposited checks were ultimately returned as Non-Sufficient Funds (NSF), Closed Account, or Refer to Maker. Despite this, Bergren and Morales had already transferred or withdrawn the funds immediately made available to accounts under their control. During the course of the scheme, Bergren and Morales opened more than 30 business checking accounts. The deposits and withdrawals were done at various federally insured financial institutions in the Middle District of Florida.
To date, Bergren, Morales, and others acting at their direction, deposited checks into accounts at financial institutions totaling approximately $493,017.65, of which $288,682.45 was withdrawn.
Morales previously pleaded guilty for his role in the scheme. His sentencing hearing is scheduled for May 15, 2014.
Following his arrest for the instant scheme on or about August 23, 2013, through and including the date of his re-arrest on a second complaint for the same type of activity on or about December 19, 2013, Bergren continued engaging in this check kiting scheme. During this second phase of the scheme, in which Morales was not involved, Bergren recruited others to open shell companies and corresponding business accounts at Bank of America into which Bergren deposited $32,167.19 worth of NSF or closed account checks. Bergren directed that third parties withdraw funds from these accounts before the NSF or closed account checks deposited into them cleared, and provide him with the cash. This resulted in an additional actual loss to Bank of America of $20,899.30. Thus, to date, Bergren is responsible for an intended loss of approximately $525,184.84 and an actual loss of approximately $309,581.75.
This case was investigated by the Tampa Police Department and the United States Secret Service. It is being prosecuted by Assistant United States Attorney Mandy Riedel.
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Taft Man Inidcted by A Federal Grand Jury for Conspiring with Others to Disribute MethamphetamineRead the Press Release
FRESNO, Calif. — A federal grand jury returned a three-count indictment today against David Edward Hampton Jr., 34, resident of Taft, California, charging him with conspiracy to distribute and possess with the intent to distribute methamphetamine, attempted distribution of methamphetamine and possession with intent to distribute methamphetamine and heroin, United States Attorney Benjamin B. Wagner announced.
According to court documents, David Hampton conspired with other individuals to distribute pound quantities of methamphetamine which he secured in California for distribution in South Dakota. Hampton would regularly use the U.S. Mails to deliver his methamphetamine to South Dakota.
Hampton was arrested on Tuesday March 25, 2014, at his residence in Taft, California at the time agents and police executed a search warrant at the property.
This case was the product of an investigation by the Violent Crime Task Force which includes the Bakersfield Police Department, the Kern County Sheriff’s Department, the Kern County Probation Office and the Federal Bureau of Investigation. Assistant United States Attorney Brian K. Delaney is prosecuting the case.
If convicted, Hampton faces a maximum statutory penalty of no less than 10 years up to life in prison and a $5,000,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Stanwood Washington Business Owner Sentenced to Prison for Disability Fraud SchemeRead the Press Release
A former Teamster who defrauded the union pension program as well as state and federal disability programs, was sentenced today in U.S. District Court in Seattle to one year in prison, three years of supervised release and more than $295,000 in restitution, announced U.S. Attorney Jenny A. Durkan. RICHARD STALKFLEET, 66, of Stanwood, Washington collected disability benefits for eight years, even while he was running a wood chip distribution company that earned more than half a million dollars annually. STALKFLEET put the business in his stepson’s name to try to hide his participation while he collected Teamsters Union Pension benefits, Washington State Labor and Industries Disability benefits and Social Security Disability benefits of $3,000 per month. At sentencing U.S. District Judge Ricardo S. Martinez said, “he victimized programs specifically designed to help the most needy. . . the very programs that don’t have sufficient funds to help the disabled.”
According to records filed in the case, STALKFLEET started a business known as Stalkfleet Farms in approximately 2000 and put the business in his stepson’s name. The company collected wood shavings from lumber mills and distributed them to dairy farms for use in barns. The company was quite profitable. Between November 2004 and November 2011, Stalkfleet Farms averaged monthly revenues of $43,000 and annual revenues of $516,000. The profits went right into STALKFLEET’s bank account. At the same time as he was running the successful business, STALKFLEET claimed to be disabled and unable to work since 2002, claiming his only daily activities consisted of eating, having coffee, playing with his dog, and doing “a little housework.” Due to these fraudulent claims, he collected a total of approximately $3,000 a month from the Teamsters Pension Trust, Social Security Administration and Washington State Department of Labor and Industries.
STALKFLEET fraudulently collected disability benefits between November 2004 and January 2013. As a result of his fraudulent claims, he collected $134,883 in Workers Compensation benefits, $91,831 in SSA benefits, and $69,188 in Teamsters Pension Plan benefits for a total loss of $295,902. The fraud was uncovered in 2011 when STALKFLEET had a falling out with his stepson and the stepson’s wife. L&I investigators conducted surveillance of Stalkfleet Farms and quickly confirmed that STALKFLEET was working there and driving Stalkfleet Farms trucks. Investigators interviewed more than 10 of Stalkfleet Farms’s customers. All of them thought of RICHARD STALKFLEET as the business’s true owner and their point of contact.
In asking for a prison sentence, prosecutors highlighted the length of the fraud and the fact that STALKFLEET was not struggling financially, while he took advantage of programs that are essential for the disabled. “Each of the programs defendant defrauded is a pool of limited resources intended to support disabled workers who cannot support themselves. But over the same years defendant took in millions of dollars in business revenues at Stalkfleet Farms, he drained almost $300,000 set aside for those unable to work,” prosecutors wrote in their sentencing memo.
The case was investigated by the Social Security Office of Inspector General (SSA-OIG) and was prosecuted by Special Assistant United States Attorney Seth Wilkinson. Mr. Wilkinson prosecutes Social Security fraud cases in federal court as part of a partnership between the United States Attorney’s Office and the Social Security Administration Office of the General Counsel.
Source of Medical Patient Stolen Identities Pleads GuiltyRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS-CI), and Ric. L. Bradshaw, Sheriff, Palm Beach County Sheriff’s Office, announce that Eltonya Wiley, 40, of Lady Lake, pled guilty for her participation in a wide-ranging identity theft scheme. Wiley was the last of six defendants to plead guilty in the case. As part of her guilty plea, Wiley admitted that she made unauthorized use of medical patients’ Social Security numbers in connection with ongoing identity theft. The government alleged, and Wiley agreed that at least 92 patients of Villages Endocopy near The Villages in Central Florida had their identities stolen by virtue of Wiley’s conduct while she was an employee at that medical facility.
Specifically, Wiley pled guilty to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. ' 1349 (Count 1), three counts of wire fraud, in violation of 18 U.S.C. ' 1343 (Counts 4, 6, and 12), and one count of aggravated identity theft, in violation of 18 U.S.C. ' 1028A (Count 35). At sentencing, she faces a maximum of twenty years in prison for each count of conspiracy to commit wire fraud, and wire fraud; and, a mandatory term of two years in prison for the aggravated identity theft charge, to run consecutively to any other sentence.
Sentencing is scheduled for June 6, 2014 at 2:00 p.m. before U.S. District Judge Kenneth Marra in West Palm Beach.
The scheme involved, in part, stealing the identities of patients at a medical facility in central Florida. Those identities were then used to file fraudulent federal income tax returns in the patients’ names seeking fraudulent refunds, and obtaining fraudulent credit cards which were then used to make fraudulent purchases.
Mr. Ferrer commended the investigative efforts of IRS-CI and the Palm Beach County Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Stephen Carlton.
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.
Solon Man Charged with Defrauding His Former Employer Out of Nearly $1.5 MillionRead the Press Release
A 15-count criminal indictment filed charging a Solon man with defrauding his former employer out of nearly $1.5 million, law enforcement officials said.
John A. Miller, 53, was charged with one count of conspiracy to commit mail fraud, nine counts of mail fraud, three counts of tax evasion and two counts of money laundering in connection with a scheme to defraud Parker Hannifin Corp.
“This defendant is accused of running a scheme in which he stole nearly $1.5 million from his employer,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “This type of self-dealing is not fair to workers or shareholders and will not be tolerated.”
Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office, said: “Mr. Miller put a lot of effort into orchestrating and maintaining this seven year fraudulent scheme. Law enforcement will continue efforts to follow the money trial to ensure financial fraudsters are brought to justice.”
“Fraud and embezzlement schemes harm everyone,” said Kathy Enstrom, Special Agent in Charge, IRS Cincinnati Field Office. “As we often see, the victims are not only the taxpayers, but also the individuals and entities who suffer financial harm.”
Miller worked at Parker Hannifin Corp. (PHC) for 25 years where he directed work to outside contractors. In 2002, he approached his neighbor, Nancy Seaman, to do IT work for PHC, according to the indictment.
To do this, Seaman established Digital Design Services, Inc., which she operated out of her residence in Solon. In 2004, Miller approached R.K. (not charged herein), who owned and operated a billing company in Pennsylvania which had previously been a subcontractor for PHC. Miller requested that R.K. and his billing company prepare invoices and billings for PHC, and R.K. agreed to do so, according to the indictment.
Beginning around 2004, Miller engaged in a fraudulent scheme to increase the payment he was receiving from PHC by using subcontractors Seaman and R.K. to funnel payments to himself. He did his despite having a salaried position at PHC and without the knowledge or consent of PHC, according to the indictment.
Miller did this by falsely inflating the invoices submitted by Digital Design and Seaman and by asking R.K. to process payments and to pay subcontractors as designated by Miller. Under this arrangement, Miller submitted invoices in the names of Miller’s wife and son, even though neither had done any of the work submitted in these invoices nor were they even aware that Miller was using their names to submit such billings to PHC, according to the indictment.Miller caused a loss to PHC of approximately $1,489,494 between 2004 through 2011, according to the indictment.
Seaman was aware that additional amounts, over and above her Digital Design billings, were being sent to her. Miller instructed Seaman to pay these additional funds to him in cash, less a 30 percent commission to Seaman, according to the indictment.Seaman previously pleaded guilty in U.S. District Court to conspiring with Miller to conceal Miller’s tax liability from the Internal Revenue Service and to conspiring with Miller to commit wire fraud in a scheme to defraud Parker Hannifin. She is awaiting sentencing.
Miller is also charged with money laundering for using the funds he stole from Parker Hannifin Corporation to pay his tax liabilities to the IRS and to pay for his son’s tuition at Cornell University, according to the indictment.Miller is also charged with tax evasion for calendar years 2009 to 2011. During the calendar year 2009, Miller received approximately $192,042 in taxable income, and owed approximately $30,568 in income tax; during the calendar year 2010, Miller received approximately $378,571 in taxable income, and owed approximately $93,745 in income tax; and during the calendar year 2011, Miller had received approximately $217,060 in taxable income, and owed approximately $43,488.00 in income tax, according to the indictment.
This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigations, in Cleveland, and is being handled by Assistant U.S. Attorney Christian H. Stickan.If convicted, the defendants’ sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Six Individuals Associated with the Newspaper and Mail Deliverers’ Union ArrestedRead the Press Release
A criminal complaint was unsealed today in federal court in the Eastern District of New York charging Benjamin Castellazzo, Jr., Rocco Giangregorio, Glenn LaChance, Rocco Miraglia, also known as “Irving,” and Anthony Turzio, also known as “the Irish Guy,” with conspiring to defraud the Newspaper and Mail Deliverers’ Union (“NMDU”) and Hudson News in order to obtain a union card and employment at Hudson News for Castellazzo, Jr.
In addition, a three-count indictment was unsealed today in United States District Court for the Eastern District of New York charging Thomas Leonessa, also known as “Tommy Stacks,” with wire fraud, wire fraud conspiracy, and theft and embezzlement from employee benefit plans, in an unrelated scheme. The indictment was returned under seal by a federal grand jury sitting in Brooklyn, New York, on March 6, 2014, and relates to Leonessa’s alleged “no show” job as a delivery driver for the New York Post.
Castellazzo, Jr., Giangregorio, LaChance, Miraglia, Turzio, and Leonessa were arrested earlier today, and their initial appearances are scheduled for this afternoon before United States Magistrate Judge Robert M. Levy at the United States Courthouse, 225 Cadman Plaza East, Brooklyn, New York.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George C. Venizelos, Assistant Director in Charge, Federal Bureau of Investigation (FBI), New York Field Office.
As alleged in the complaint, the NMDU is an independent union that represents approximately 1,500 employees involved in the newspaper industry in New York, New Jersey, and Connecticut. NMDU members deliver newspapers for the New York Times, the Wall Street Journal, the New York Daily News, the New York Post, and El Diario.
Between June 2009 and October 2009, Miraglia, who was a foreman at the New York Daily News – as well as an alleged associate of the Colombo organized crime family of La Cosa Nostra and the son of a deceased soldier in the Colombo family – conspired with officials of the NMDU and with Turzio, who was an employee of El Diario, to get an NMDU union card for Castellazzo, Jr. and place him in a job at Hudson News. Castellazzo, Jr. is the son of Benjamin Castellazzo, the alleged underboss of the Colombo family. Giangregorio and LaChance, who were Business Agents for the NMDU, also are charged with participating in this scheme.
As alleged in the indictment, Leonessa was employed by the New York Post to deliver newspapers by truck from a New York Post warehouse in the Bronx, New York, to New Jersey. He was also a member of the NMDU, which maintained offices, including offices for its welfare and pension funds, in Queens, New York. From about December 2010 to about September 2011, Leonessa had a “no show job” at the New York Post, that is, a job for which he was paid wages and benefits, but which he did not perform. When Leonessa did not complete his required deliveries, he was nevertheless, based on his fraudulent representations, paid wages by the New York Post and accorded benefits from employee pension and welfare funds managed by the NMDU.
“Today’s arrests indicate that the NMDU and the newspaper delivery industry are, sadly, still subject to the influence of organized crime,” stated United States Attorney Lynch. “We cannot tolerate corruption in that industry, which is relied on by newspaper readers throughout New York City and beyond. We will prosecute anyone who seeks to obtain employment – or to maintain “no show” employment – in that industry by trading on the power of organized crime. Such acts not only lead to ill-gotten gains, but they also displace innocent, hard-working union members and would-be union members from jobs they have rightfully earned. We thank our partners at the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, for their tremendous efforts to identify and root out these corrupt practices.” Ms. Lynch also extended her grateful appreciation to the New York City Police Department, the New York County District Attorney’s Office, and Waterfront Commission of New York Harbor for their assistance.
“As alleged, a paycheck in exchange for a hard day’s work was a foreign concept to these defendants. Instead, they engaged in a scheme to defraud the NMDU and Hudson News for easy money and personal gain. The FBI, along with its law enforcement partners, will continue to pursue allegations of corruption and fraud all levels,” stated FBI Assistant Director-in-Charge Venizelos.
The defendants are scheduled to be arraigned this afternoon before United States Magistrate Judge Robert M. Levy at the federal courthouse in Brooklyn. The charges in the complaint and indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorneys Elizabeth A. Geddes and Allon Lifshitz and by Trial Attorney Joseph Wheatley of the Department of Justice’s Organized Crime and Gangs Section.
The Defendants:
BENJAMIN CASTELLAZZO, JR.
Age: 48
Manahawkin, NJ
ROCCO GIANGREGORIO
Age: 39
Dumont, NJ
GLENN LACHANCE
Age: 50
Oceanside, NY
ROCCO MIRAGLIA
Age: 43
Staten Island, NY
ANTHONY TURZIO
Age: 78
New York, NY
THOMAS LEONESSA
Age: 52
High Bridge, NJ
E.D.N.Y. Docket Nos. 14-CR-120 and 14-M-282
Serial Fraudster Sentenced to More Than 12 Years in Federal PrisonRead the Press Release
Tampa, Florida – U.S. District Judge Susan C. Bucklew sentenced Latasha Callens (35) yesterday to 12 years and 5 months in federal prison, to be followed by five years of supervised release, for bank fraud, access device fraud, mail fraud, and aggravated identity theft. As part of her sentence, the court also entered a money judgment in the amount of $223,798, the proceeds of the charged criminal conduct. Callens pleaded guilty on December 3, 2013.
According to court documents and statements made in court, Callens committed crimes from at least as early as July 2011 through her arrest in May 2013. Callens defrauded banks and individuals on at least 58 occasions during a two-year period.
In one of her schemes, Callens approached individuals, usually at ATMs, and told them about her need to cash a check and her inability to deposit the check into her bank account. She then convinced the individuals to deposit the checks into their own accounts and withdraw the funds for her. She sometimes gave them $100 for their trouble. In each case, the checks were worthless. They were generally drawn on closed accounts, because the checks and checkbooks had been stolen.
On two occasions in December 2012, Callens committed access device fraud. She used a stolen identity to obtain dental care at a Clearwater dental office. She purchased $12,000 worth of dental services under the false pretense that a co-conspirator would consent to pay for the treatment. Using a stolen credit card number provided by the co-conspirator, Callens paid for herself to receive a root canal, a bridge, an extraction, a temporary crown, a retainer, anesthesia, and other items and services.
In another scheme, Callens committed stolen identity refund fraud. For tax years 2010, 2011, and 2012, she defrauded the Internal Revenue Service and certain taxpayers by electronically filing false and fraudulent tax returns, using stolen identities and, thereby, obtaining refunds. She sought approximately $800,000 in fraudulent tax returns.
“Through the combined, tenacious investigative efforts of several key agencies in the Tampa Bay area, this predator was finally brought to justice,” said John Joyce, Special Agent in Charge of United States Secret Service’s Tampa Field Office. “Unfortunately, there are still others engaging in similar criminal behavior. Those who emulate Ms. Callens’ way of life will also eventually be apprehended and receive appropriate sentences.”
“The suspect in this case played on the sympathies of good samaritans and took advantage of their willingness to help,” said Jane Castor, Chief of the Tampa Police Department. “This sentence sends a loud and clear message that fraud of any kind is not tolerated in our city.”
"Although this was a collaborative effort of many agencies, everyone involved shared a single mission to focus on those individuals who involve themselves in tax refund fraud and identity theft. This should be a clear warning for those who engage in this type of criminal activity that the only outcome is lengthy prison terms and large monetary fines," stated Hillsborough County Sheriff David Gee.
“Stolen identity cases continue to plague our citizens and our criminal justice system,” said Clearwater Police Chief Tony Holloway. “This suspect didn’t care whose lives she impacted and from whom she stole money. She used stolen identities to make a living. She left an amazing trail of financial devastation and destruction in her wake,” Holloway added. “This sentence and accompanying money judgment send a strong and stern message to her and others like her – we will catch you, and you will pay for your crimes.”
“This case serves as an excellent example of how law-enforcement agencies from diverse jurisdictions can work together to solve crimes, protect our communities and get offenders off the street,” said Deputy Chief Bernard Seeley of the Temple Terrace Police Department. “We’re proud to be a part of this collaborative effort.”
“Individuals such as Latasha Callens who commit identity theft and refund fraud of this magnitude deserve to be punished to the fullest extent of the law,” said James D. Robnett, Special Agent in Charge IRS Criminal Investigation. “Callens demonstrated a blatant disregard of the integrity of the United States tax system and caused immeasurable hardship to innocent victims. IRS Criminal Investigation remains committed to the pursuit of identity theft and together with the members of the Tampa Bay Alliance, we will hold those who engage in similar conduct accountable.”
This case was investigated by the Tampa Police Department, the U.S. Secret Service, the Hillsborough County Sheriff’s Office, the Temple Terrace Police Department, the Clearwater Police Department, and the Internal Revenue Service’s Criminal Investigations Division. It was prosecuted by Assistant United States Attorney Thomas N. Palermo.
Sentencing for March 20 - 27, 2014Read the Press Release
Armand Lewis Mullendore, 58, of Afton, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on March 25, 2014, for conspiracy to possess with intent to distribute, and to distribute 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine. Mullendore was arrested in Kemmerer, Wyoming. He received 262 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $2,000.00 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
John Richard Rolater, 69, of Eagle, Colorado, was sentenced by Federal District Court Judge Scott W. Skavdahl on March 25, 2014, for conspiracy to smuggle goods into the United States. Rolater appeared pursuant to a summons. He received two years of probation and was ordered to pay a $25,000.00 fine. This case was investigated by the U.S. Department of Homeland Security.
Aaron Restad, 37, of Casper, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on March 21, 2014, for conspiracy to possess with intent to distribute, and to distribute at least 50 grams of a mixture or substance containing a detectable amount of methamphetamine. Restad was arrested in Casper, Wyoming. He received 77 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.Robert Anthony Johnson, 28, of Gillette, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on March 21, 2014, for conspiracy to possess stolen firearms. Johnson was arrested in Gillette. He received 34 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $500 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Jeremia Montoya, 20, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on March 20, 2014, for conspiracy to possess with intent to distribute, and to distribute between 350-500 grams of a mixture or substance containing a detectable amount of methamphetamine. Montoya was arrested in Cheyenne, Wyoming. He received 60 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $400.00 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Andre Sinclair Fuller, 31, of Fort Collins, Colorado, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on March 20, 2014, for being a felon in possession of a firearm. Fuller was arrested in Cheyenne, Wyoming. He received 41 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Second Former Gulf Cartel Plaza Boss Pleads Guilty to Federal Drug ChargesRead the Press Release
BROWNSVILLE, Texas – Jose Luis Zuniga-Hernandez, 46, aka Wicho or XW or Commandante Wicho, has entered a plea of guilty to conspiracy to import more than five kilograms of cocaine and more than 1,000 kilograms of marijuana between January 2002 and July 2013, announced United States Attorney Kenneth Magidson. As part of his plea, he has also agreed to a $5 million forfeiture. His brother, Armando Arizmendi Hernandez, 37, aka Commandante Mando or XW2, entered the same plea and agreed forfeiture on Tuesday, March 25, 2014.
Zuniga-Hernandez served as plaza boss of the El Control, Tamaulipas, Plaza, and during that time, Arizmendi Hernandez was second in command. Arizmendi-Hernandez became the plaza boss on Nov. 6, 2010, when Zuniga-Hernandez assumed control of the Matamoros Plaza upon the death of Antonio Ezequiel Cardenas-Guillen. On March 28, 2011, Rafael Cardenas-Vela came to Matamoros to take over the plaza management duties and Zuniga-Hernandez returned to the El Control Plaza. At that time, Arizmendi-Hernandez resumed his duties as second in command of the Plaza.
Cartel Del Golfo Transnational Criminal Organization (CDG) plaza bosses are appointed to specific regions to help coordinate the importation and distribution of multi-ton shipments of cocaine, marijuana and other illicit narcotics within Mexico and into the United States. They are the lead representatives for the CDG in a particular region or town, responsible for maintaining control of the region and ensuring the safe passage of narcotics. The plaza boss also extracts a "piso," or payment, from others who want to transport narcotics for importation into the United States or operate businesses in that region.
Zuniga-Hernandez received marijuana shipments from the States of Durango and Michoacán, Mexico, purchased at $60 per kilogram in Mexico and sold at $130 per kilogram in the U.S. Zuniga-Hernandez indicated the CDG smuggled more than one ton of cocaine through the Matamoros/El Control plaza areas and into the United States per month. Planes and clandestine air strips were used to fly the cocaine into Mexico for later importation and distribution within the United States.
Under his command were approximately 120 lookouts and 60 estacas. An estaca is a vehicle occupied by three or four armed individuals. Thus, 60 estacas would be anywhere from 180 to 240 armed individuals patrolling the plaza.
On Oct. 27, 2011, Zuniga-Hernandez and Arizmendi Hernandez fled into the United States with Juan Rincon-Rincon and Luis Ivan Nino-Duenes after a gun battle in Mexico involving a power struggle between the plazas of the CDG. All were found and arrested by the U.S. Border Patrol (USBP) hiding near the Rio Grande River. Upon their arrest, agents found a gold, diamond and ruby encrusted gun, more than $39,000 and several cell phones. Evidence on those phones showed discussions with "Apa" about the gun battle and what to do in response. "Apa" was identified as Jorge Eduardo Costilla-Sanchez, the head of the CDG. Also found were videos of Arizmendi Hernandez, Zuniga-Hernandez and other members of the CDG in preparation for and after the Oct. 27, 2011, gun battle.
Zuniga-Hernandez and Arizmendi Hernandez have stipulated that the total relevant conduct during their leadership was well in excess of 150 kilograms of cocaine and 1,000 kilograms of marijuana. Both have agreed they obtained at least $5 million in drug proceeds as a result of the conspiracy.
They face a mandatory minimum sentence of 10 years and up to life in federal prison. Both will be sentenced before U.S. District Court Judge Hilda G. Tagle on June 30, 2014.
The case was investigated by Homeland Security Investigations, Drug Enforcement Administration, FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives and the Brownsville Police Department. Assistant United States Attorneys Angel Castro and Jody Young are prosecuting.
Rockford Resident Sentenced for Federal Firearms ViolationsRead the Press Release
KNOXVILLE, Tenn. – On Mar. 25, 2014, Brandon Waldrip, 32, of Rockford, Tenn., was sentenced to serve 18 months in prison, by the Honorable Thomas W. Varlan, Chief U.S. District Judge, for possession of unregistered weapons and selling a firearm to a convicted felon. Upon his release from prison, Waldrip will be subject to two years of supervised release.
Waldrip pleaded guilty in September 2013, to knowingly possessing two silencers without serial numbers and not registered to him in the National Firearms Registration and Transfer Record. He also pleaded guilty to knowingly selling a firearm to a convicted felon.
Facts stipulated in the plea agreement on file with the U.S. District Court show that Waldrip began making and selling firearms silencers beginning in January 2013. In February 2013, he sold a silencer to an undercover agent of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Additionally, in February 2013, Waldrip sold a firearm to an individual working on behalf of law enforcement who asked if he could leave the gun at Waldrip’s house stating, “being a convicted felon, I’m not trying to have them pop up, you know, home inspection . . . .” Waldrip agreed to this request even after being informed by the individual that he was a convicted felon. The firearm was retrieved by the individual from Waldrip’s house in March 2013.
This conviction was the result of an investigation conducted by Bureau of Alcohol, Tobacco, Firearms and Explosives and Knoxville Police Department.
Rochester Man Sentenced on Drug Conspiracy and Money Laudering ChargesRead the Press Release
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Albert L. Sturgis, 51, of Rochester, N.Y., who was convicted of conspiracy to possess with intent to distribute and distribute five kilograms or more of cocaine, 50 grams or more of cocaine base, and one kilogram or more of heroin and money laundering, was sentenced to 130 months in prison and 10 years of supervised release by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Jennifer M. Noto, who handled the case, stated that the defendant was a well-known drug dealer operating primarily on the West side of the City of Rochester and was responsible for the distribution of numerous kilograms of cocaine in the Rochester area. Sturgis and 11 others were arrested in February 2010 after a nearly year-long investigation conducted by Federal and State authorities and involving the court-authorized interception of wire communication on cellular telephones utilized by the defendant and others in the drug conspiracy. All 12 defendants have been convicted, Sturgis is the eighth defendant to be sentenced. This is Sturgis’ third felony drug conviction.
The sentencing is the culmination of a multi-agency investigation under the Organized Crime Drug Enforcement Task Force (OCDETF) initiative. Federal and State law enforcement agencies, including Special Agents of the Bureau of Alcohol Tobacco Firearm and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon, Special Agents of the Drug Enforcement Administration, under the direction of Acting Special Agent in Charge James J. Hunt, Special Agents of the Criminal Investigation Division of the Internal Revenue Service, Shantelle P. Kitchen, Acting Special Agent in Charge, New York Field Office, and officers from the Rochester Police Department, under the direction of chief Michael Ciminelli, worked in concert with the United States Attorney's Office in the year-long investigation.Project Safe Neighborhoods Grant AnnouncementRead the Press Release
SHREVEPORT/MONROE/ALEXANRIA/LAFAYETTE/LAKE CHARLES, La. – United States Attorney for the Western District of Louisiana, Stephanie A. Finley, and the Project Safe Neighborhoods Task Force announced today that the Department of Justice (DOJ), the Office of Justice Programs (OJP), and the Bureau of Justice Assistance (BJA) is seeking applications for funding of grants under the Violent Gang and Gun Crime Reduction Program, also known as Project Safe Neighborhoods (PSN).
This program furthers the Department of Justice=s mission and violent crime reduction strategy by providing support to state, local and tribal efforts to reduce gun and gang-related violent crime. Contingent on the availability of funds, grant awards totaling $300,000 are possible in the Western District of Louisiana to fund new and current comprehensive gun crime reduction strategies and gang violence reduction strategies. Grant proposal submissions must be received by the U.S. Attorney’s Office in Lafayette before 5 p.m. on April 10, 2014.
Various types of single or multi‑grantee grant applications are welcome including those that address the following:
- Gang violence and gun violence reduction, deterrence, prevention, community outreach and education;
- Enforcement, adjudication, and supervision programs;
- Prisoner Reentry Programs; or
- Other innovative related projects.
The FY2014 PSN Competitive Grant Announcement and links to other grants available, and information on the PSN Program can be found at the U.S. Attorney’s web site www.justice.gov/usao/law/ as well as www.justice.gov/usao/law/psn.html or at www.psn.gov and www.bja.gov/Funding/14PSNsol.pdf.
For more information, contact Western District of Louisiana Assistant U.S. Attorney and PSN and Anti-Gang Coordinator Robert W. Gillespie Jr. at (318) 676-3600.
Complete instructions on how to register and submit an application for this and other grants are available at www.Grants.gov. The FY2014 PSN Grant number is BJA-2014-3810. Applicants can also contact the www.Grants.gov Customer Support Hotline for technical assistance with submitting any application at 800-518-4726 or 606-545-5035 or by e-mail to [email protected].
Pennsylvania Man Pleads Guilty to Possession of Child PornographyRead the Press Release
WASHINGTON – Vincent Petaccio, 60, of Levittown, Pa., pled guilty today to a federal charge 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 (MPD).
Petaccio entered the guilty plea in the U.S. District Court for the District of Columbia. The Honorable Rudolph Contreras is to sentence him on June 18, 2014. Petaccio faces a maximum sentence of 20 years of imprisonment and a $250,000 fine.
According to the government's evidence, on April 12, 2013, Petaccio contacted an undercover officer with the FBI's Child Exploitation Task Force, who had posted an ad on a social network site. Over the course of two days, Petaccio engaged in instant message conversations with officer, whom he believed was the father of an under-aged girl.
During their communications, Petaccio sent the undercover officer 59 still images and 10 videos of graphic child pornography. Pursuant to a search of Petaccio’s home at the time of his arrest, law enforcement recovered approximately 150 still images and 10 videos of child pornography on his computer.
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 Chief Lanier praised the work of the MPD Detectives and Special Agents of the FBI Child Exploitation Task Force. They also commended the efforts of Assistant U.S. Attorney Ari Redbord, who is prosecuting the case.
14-072Pennsylvania Man Admits Mann Act Violations in Running Prostitution BusinessRead the Press Release
NEWARK, N.J. – An Allentown, Pa., man previously charged with sex trafficking of a minor today admitted his role in coercing women to travel from Pennsylvania to New Jersey to engage in prostitution and sexual activity for which any person can be charged with a crime, U.S. Attorney Paul J. Fishman announced.
Francisco Torrellas, a/k/a “Francisco Fordham Jr.,” “Dream,” “Daddy,” and “Pretty,” pleaded guilty before U.S. District Judge Claire C. Cecchi to Count Nine of a 10-count superseding indictment, which charged him with one count of coercion and enticement to engage in prostitution. He agreed to a sentence of 10 years in prison as part of his plea.
According to the superseding indictment and other documents filed in court:
From November 2010 to February 2013, Torrellas allegedly conspired with others to operate a prostitution business in New Jersey, Pennsylvania and elsewhere. Torrellas managed the business, traveled, and caused prostitute employees, including a minor, to travel interstate for the purpose of engaging in sex acts in exchange for money.
Torrellas used the Internet to post advertisements for sexual services on the website Backpage.com. Torrellas also developed rules for the prostitutes, booked hotel rooms, and, while incarcerated, used the phone to manage, promote, and carry on his prostitution business, specifically causing his conspirators and others to direct the proceeds of the business to his commissary account at the Essex County Correctional Facility. Torrellas also attempted to influence, delay or prevent the testimony of another person or persons in connection with the case against him.
The conspiracy count carries a maximum potential penalty of five years in prison. The Travel Act counts each carry a maximum potential penalty of five years in prison. The counts relating to trafficking and transportation of a minor carry a mandatory minimum penalty of ten years in prison and a maximum penalty of life imprisonment. The count relating to coercion and enticement to engage in prostitution carries a maximum potential penalty of 20 years in prison and the count charging obstruction of justice carries the maximum term that could have been imposed for the offenses charged. The defendant also faces a fine of $250,000 or twice the amount of the gain or loss from the offense for each count of conviction. Sentencing is scheduled for July 15, 2014.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; and the Secaucus, Jersey City, and the Allentown, Pa., police departments with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Danielle Corcione and Jenny Kramer of the U.S. Attorney’s Office Criminal Division in Newark.
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Defense counsel: Michael N. Pedicini Esq., Chatham, N.J.Torrellas, Francisco SIndictment
Owner of Bulk Mailing Company Sentenced to 18 Months in Prison for Multimillion-Dollar FraudRead the Press Release
NEWARK, N.J. – One of the operators of Clevett Worldwide Mailers LLC, a Succasunna, N.J., bulk mailing house, was sentenced today to 18 months in prison for defrauding clients of more than $1 million through a fraudulent bulk-mailing scheme in which he shredded millions of pieces of mail rather than delivering them, U.S. Attorney Paul J. Fishman announced.
Harold Clevett, 68, of Middlesex, N.J., previously pleaded guilty before U.S. District Judge Kevin McNulty to an indictment charging him with one count of conspiracy to commit wire fraud. Judge McNulty imposed the sentence today in Newark federal court.
Clevett’s son, Mark Clevett, 37, of Randolph, N.J., who owned and operated the business with his father, also previously pleaded guilty to the same charge and was sentenced to 24 months in prison on Feb. 24, 2014.
According to documents filed in this case and statements made in court:
Mark Clevett owned, and both Clevetts operated, Clevett Worldwide Mailers, which contracted with international and domestic customers to handle large mailings. Customers sent their mail jobs to Clevett Worldwide Mailers for sorting, addressing and delivery to the post office. The company received fees for each piece of mail and for the total weight of the mail that it handled.
Both father and son admitted that rather than sending their clients’ mail as contracted, they directed their employees to throw away all or part of it, and even called in a shredding company to destroy unsent mail.
Mark and Harold Clevett also acknowledged they charged their customers for the full amount of the mailings, even sending some of their customers fraudulent postal forms to make it appear as though the mailings were delivered. The pair admitted that between 2007 and June 2011, they discarded and shredded nearly 3 million pieces of customer mail and reaped nearly $1 million in illicit profits.
In addition to the prison term, Judge McNulty sentenced Harold Clevett to serve one year of supervised release, six months of which will be home confinement and ordered him to pay restitution of $999,461.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the investigation leading to today’s sentencing.The government is represented by Assistant U.S. Attorneys Rahul Agarwal and Michael Robertson of the U.S Attorney’s Office in Newark.
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Defense counsel:
Harold Clevett: Brian J. Neary Esq., Hackensack, N.J.
Mark Clevett: Don Larsen Esq., Montville, N.J.New Middleton Man Faces Child Pornography ChargesRead the Press Release
Joey Thomas Holt, 56, of New Middletown, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about December 8, 2013, through on or about February 20, 2014, Holt knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct. The indictment also charges that on March 6, 2014, Holt possessed two computers, each that contained child pornography.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Youngstown Office of the Federal Bureau of Investigation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
New Hampshire Man Charged with Coercing A MinorRead the Press Release
BOSTON – A New Hampshire man was charged today with attempting to coerce a minor to engage in sexual activity.
Karl W. Leeman, 46, of Milford, N.H., has been indicted on charges that he induced and coerced, and attempted to induce and coerce, a minor to engage in sexual activity.
In February 2014, Homeland Security Investigations undercover agents in Boston placed an advertisement on Craigslist purportedly as a mother seeking an adult interested in a “taboo relationship” with her daughter. Leeman responded that he was interested, even after the purported mother disclosed that the daughter was only 14-years-old. Leeman proceeded to engage in more than 650 email communications with the purported mother, detailing the sexual activities in which he would engage with the minor “daughter.” On Feb. 27, Leeman traveled from his place of work in Acton, Mass. to Watertown for the purpose of having sex with a minor. Upon his arrival at the designated meeting place, he was arrested by HSI agents. At the time of his arrest, Leeman was carrying alcohol, bath products, lubricant, and gifts of clothing for the minor.
If convicted, Leeman faces a statutory mandatory minimum term of 10 years in prison, a minimum of five years and a maximum of a lifetime of supervised released, and a $250,000 fine.
United States Attorney Carmen M. Ortiz; Bruce M. Foucart, Special Agent in Charge of U.S. Immigration and Customs enforcement’s Homeland Security Investigations in Boston, made the announcement today. Assistance was also provided by HSI Manchester, the Massachusetts State Police, the Watertown Police Department and the Milford, N.H. Police Department. The case is being prosecuted by Eve A. Piemonte Stacey of Ortiz’s Major Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys= Offices and the Criminal Division=s CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
National Crime Victims’ Rights Week Set for April 6-12Read the Press Release
CHARLOTTESVILLE, VIRGINIA – The Jefferson Area Victim Assistance Coalition will commemorate National Crime Victims’ Rights Week (April 6-12) with an event in Charlottesville honoring local officials who have displayed excellence in their work with crime victims.
The theme for National Victims’ Rights Week 2014, “30 Years: Restoring the Balance of Justice,” celebrates the enduring work of those leaders who have dedicated their professional lives to providing services to victims of crime. Through decades of advocacy and hard work, victims of crime have gained access to crime victim’s compensation or services to help rebuild their lives, among other benefits once denied to victims.
Locally, the Jefferson Area Victim Assistance Coalition will commemorate National Crime Victims’ Rights Week with a local event on Wednesday, April 9, 2014 at 9 a.m. inside Charlottesville City Hall, 605 E. Main Street. At this event, the coalition will present awards to five individuals and one agency that have devoted innumerable hours, months and years to the cause of restoring the balance of justice in the care of crime victims.
The Jefferson Area Victim Assistance Coalition consists of members from the Albemarle County Victim/Witness Program, the Albemarle/Charlottesville Domestic Violence Services Coordinator, the Charlottesville Victim/Witness Program, the FBI Victim Assistance Program-Richmond Division, the Fluvanna County Victim/Witness Program, the Greene County Victim/Witness Program, Homeland Security Investigations Victim Assistance Program, the Louisa County Victim/Witness Program, the Shelter for Help in Emergency, the United States Attorney’s Office-Victims/Witness Program and the University of Virginia Victim/Witness Program.
This event is free and open to the public.