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14 May 2014
Laurel Man Sentenced to over 6 Years in Prison for Transportation of Child PornographyRead the Press Release
Baltimore, Maryland – U.S. District Judge Catherine C. Blake sentenced Jeffrey Ellis, age 35, of Laurel, Maryland, today to 78 months in prison, followed by 15 years of supervised release, for transportation of child pornography. Judge Blake ordered that upon his release from prison, Ellis must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Colonel Marcus L. Brown, Superintendent of the Maryland State Police.According to Ellis’ plea agreement, on February 16, 2012, an FBI agent working in an undercover capacity signed onto a file sharing program through an Internet-connected computer and chatted with a user named “mdboi78,” later identified as Jeffrey Ellis. The user allowed the undercover agent to download several images of minors engaged in sexually explicit content from the “mdboi78” folder. On June 13, 2012, FBI agents executed a search warrant at Ellis’ residence and recovered three laptop computers, a digital camera, and at least three external hard drives.
At least 250 images, including videos, of child pornography were recovered from the seized items. Logs and chats involving Ellis were also recovered from one of the laptop computers and hard drive. The recovered chats included conversations in which Ellis stated that he was having sex with a 13-year old girl and that he had been having sex with her for approximately two years. Ellis also sent a photo of the girl to the person with whom he was chatting. The child was identified and interviewed by law enforcement. The girl advised that she did not have sex with Ellis and Ellis also denies having sex with the child, although he chatted about having sex with her online.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. For more information about internet safety education, please visit www.justice.gov/psc and click on the "resources" tab on the left of the page.
The case was investigated by the FBI-led Maryland Child Exploitation Task Force (MCETF), which was created in 2010, with members from10 state and federal law enforcement agencies. The Task Force coordinates with the National Center for Missing and Exploited Children and the Maryland State Police Child Recovery Unit to identify missing children and to combat child prostitution.
United States Attorney Rod J. Rosenstein commended the FBI and Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Ayn B. Ducao, who prosecuted the case.
Lafayette Business Man Sentenced to 30 Months in Prison for Scheme That Cost Investors MillionsRead the Press Release
LAFAYETTE, La. –United States Attorney Stephanie A. Finley announced today that Herbert S. “Steve” Fouke, 55, of Lafayette, was sentenced by U.S. District Judge Richard T. Haik to 30 months in prison and three years of supervised release for conspiracy to commit securities fraud, investment adviser fraud, wire fraud and mail fraud, involving an investment scheme that cost investors $8 million. He was also ordered to pay $6,380,808.03 restitution to victims of the scheme.
According to evidence presented at the guilty plea on September 6, 2013, Fouke became a client of Richard Buswell and Bowman Investment Group LLC, which was also Buswell’s company. Fouke later became president of the company and recruited friends and business associates to become clients of Bowman Investment Group. Fouke admitted to being present at meetings between Buswell and his clients, during which Buswell made false statements to the clients about his credentials, his commissions, and the rates of return that he guaranteed the clients would receive. Buswell admitted in a guilty plea July 24, 2013 to engaging in frequent and excessive stock trades in order to earn commissions.
The FBI conducted the investigation. Assistant U.S. Attorneys Kelly P. Uebinger and Howard C. Parker prosecuted the case.
Lackawanna County Man Sentenced for His Role in Tax FraudRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Walter J. Pietralczyk, Jr., age 40, Jermyn, Pennsylvania was sentenced yesterday in federal court for his role in a tax fraud while also involved his wife, Lackawanna County Attorney, Danielle Ross. U.S. Magistrate Judge, Thomas M. Blewitt, sentenced Pietralczyk to a two year term of probation and ordered him to pay restitution in the amount of $63,124.
According to United States Attorney Peter Smith, a criminal information was filed on November 5, 2013 which charged Pietralczyk with one count of preparing and filing a fraudulent joint tax return on behalf of himself and his wife, Danielle Ross. The information charges that Pietralczyk knew that the tax return, Form 1040, was fraudulent and false as to a material matter in that the income reflected was substantially less than the couple’s actual joint income for the calendar year 2009. The restitution ordered reflects the tax loss for the calendar years 2008 through 2010.
The prosecution is the result of a joint investigation by the United States Internal Revenue Service (IRS) and the Federal Bureau of Investigation (FBI). The case was prosecuted by Assistant United States Attorney Michelle Olshefski.
Jury Convicts Lebanon Man of Firearms Violations after he Rammed into Pawn Shop with his CarRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Lebanon, Mo., man was convicted in federal court today for illegally possessing a firearm and attempting to acquire a firearm.
James Roy Jacoby, 31, of Lebanon, was found guilty of both counts of a May 8, 2011, federal indictment that charges him with being a felon in possession of a firearm and with making false statements in an attempt to acquire a firearm.
On Jan. 15, 2013, Jacoby took out a $50 pawn broker loan at Rawhide Gun and Pawn, 321 W. Commercial, in Lebanon. Jacoby gave a Remington 16-gauge shotgun as collateral. The shotgun belonged to Jacoby’s mother.
On Feb. 1, 2013, Jacoby returned to Rawhide Gun and Pawn to redeem his pawn ticket and retrieve the shotgun. Jacoby completed ATF Form 4473 (Firearms Transaction Record Part I – Over-the-Counter). On the form, Jacoby falsely answered “No” to the question about whether he had a felony conviction: “Have you ever been convicted in any court of a felony, or any other crime, for which the judge could have imprisoned you for more than one year, even if you received a shorter sentence including probation?”
After Jacoby paid $60 to a store employee to repay the loan, the employee informed Jacoby that the National Instant Criminal Background Check System (NICS) showed that he was a felon, and that his request for the return of the shotgun was being denied. The employee also refused to return Jacoby’s loan payment, and said the store would not release the shotgun to another person.
Jacoby then turned over a glass display case, and the employee ordered him to leave the pawn shop. Jacoby exited the shop and got into his car. Jacoby twice rammed the store with his car, striking the employee, a store patron, and another vehicle. Jacoby’s car became disabled, and he fled on foot.
Jacoby was subsequently subdued by Lebanon police officers after a struggle in which he struck an officer. Jacoby was charged in state court with assault, armed criminal action and property damage, and held on a $100,000 bond.
It is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Jacoby has two prior felony convictions for assault and prior felony convictions for assaulting a law enforcement officer and resisting arrest.
Under federal statutes, Jacoby is subject to a mandatory minimum sentence of 15 years in federal prison without parole. Jacoby will be sentenced as a career criminal due to his prior felony convictions. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
Following the presentation of evidence, the jury in the U.S. District Court in Kansas City, Mo., deliberated for about an hour before returning the guilty verdict to U.S. District Judge Beth Phillips, ending a trial that began Monday, May 12, 2014.
This case is being prosecuted by Assistant U.S. Attorney Gary Milligan. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Lebanon, Mo., Police Department.
Julio A. Garcia-Encarnacion in Jail for Failure to Pay Legal Child SupportRead the Press Release
SAN JUAN, P.R – Today, United States District Court Judge Francisco Besosa revoked the probation term of convict Julio A. García-Encarnación, a well-known and highly appraised race horse jockey, for failure to pay legal child support obligations, announced United States Attorney for the District of Puerto Rico, Rosa Emilia Rodríguez-Vélez. Originally, Garcia-Encarnacion was sentenced to five years of probation with restitution as a condition of probation. The defendant owes child support of his two children of approximately $177,000. Judge Besosa resentenced García-Encarnación to two years in prison. Imprisonment does not terminate his restitution obligation.
Defendant García-Encarnación, is the registered parent of a minor who was born on October 1995 and since on or about January 2008, the defendant failed to comply with his child support obligation. As of May 2012, the past due amount of child support owed by García-Encarnación amounts to approximately $65,152.00.
García-Encarnación is also the biologcal and registered parent of another minor who was born in January 1996. García-Encarnación has failed to pay child support to his daughter since October 2007. As of May 2012, the defendant’s failure to comply with his child support obligation in relation to his daughter has accrued a past due amount of approximately $100,848.42.
The investigation was conducted by the Department of Health & Human Services, Office of Inspector General with the assistance of ASUME (Puerto Rico Child Support Enforcement Administration). The case was prosecuted by Assistant United States Attorneys Héctor Ramírez-Carbó and Wallace A. Bustelo.
Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office today announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Judge Strong in Great Falls on May 13, 2014 and entering pleas of Not Guilty were:
- TERRY LEE MESSOM, a 45-year-old resident of Plentywood, appeared on charges of distribution and possession of child pornography. If convicted of the most serious charge contained in the indictment, MESSOM faces 20 years imprisonment, $250,000 in fines and lifetime supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 14-31
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court's calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Indictment Charges Individual with Burglary of Federal Firearms Licensee in Roosevelt, Utah; 18 Handguns were Taken During June 2013 BurglaryRead the Press Release
SALT LAKE CITY - A three-count indictment unsealed Tuesday in U.S. District Court in Salt Lake City charges Raymond Michael Livingston, aka Bobby and Michael, age 34, with possession of 18 stolen firearms and burglary of a federal firearms licensee in connection with a June 23, 2013, burglary of Stewart’s Ace Hardware in Roosevelt.
Livingston, who has lived in Ballard, Utah, and Las Vegas, Nev., is also charged with receiving firearms while under Felony Information. At the time the indictment alleges he was in possession of the firearms stolen in Utah, he was facing a forgery charge in Nevada.
Livingston had an initial appearance Tuesday in federal court and entered not guilty pleas to the charges in the indictment. A five-day jury trial has been scheduled to start July 21, 2014, in U.S. District Judge David Nuffer’s courtroom. A detention hearing is set for Wednesday at 9:30 a.m. before U.S. Magistrate Judge Evelyn J. Furse.
Five of the firearms taken during the Roosevelt burglary have been recovered by the Las Vegas Metro Police Department during criminal investigations.
The potential maximum penalty for possession of stolen firearms and burglary of a federal firearms licensee is 10 years in prison and a fine of $250,000. Receiving firearms while under Felony Information has a potential five-year penalty. Indictments are not findings of guilt. Individuals charged in indictments are presumed innocent unless or until proven guilty in court.
The case is being investigated by ATF special agents and prosecuted by the U.S. Attorney’s Office in Salt Lake City as a part of Utah Project Safe Neighborhoods, an initiative that targets gun violence in Utah communities.
Henderson County, Kentucky, Man Charged with Human Trafficking for Recruiting Minors to Engage in Commercial Sex ActsRead the Press Release
BOWLING GREEN, Ky. – A Henderson County, Kentucky, man was charged today, by a federal grand jury in Bowling Green, with human trafficking after allegedly recruiting two minors to engage in commercial sex acts announced David J. Hale, United States Attorney for the Western District of Kentucky.
According to the two count indictment, between March 16, 2014, and March 20, 2014, in Henderson County and elsewhere, the defendant, Jathar Williams, age 31, knowingly recruited, enticed, harbored, transported, provided, obtained, and maintained by any means, two minor females, who the defendant knew through observation, had not attained the age of 18 years, and caused the minors to engage in a commercial sex act.
If convicted at trial, defendant Williams faces no less than 10 years in prison, no more than life in prison, a fine of up to $250,000 for each count, and a five year period of supervised release.
This case is being prosecuted by Assistant United States Attorney Amanda Gregory and is being investigated by the Federal Bureau of Investigation (FBI) and the Henderson, Kentucky Police Department.
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Grand Rapids Man Sentenced for Mortgage FraudRead the Press Release
GRAND RAPIDS, MICHIGAN – Seamus P. Dillon, 37, of Ada, was sentenced to two years in federal prison, followed by three years of supervised release and ordered to pay restitution in the amount of $755,693 after pleading guilty to conspiracy to commit mortgage fraud, U.S. Attorney Patrick Miles announced today. The conspiracy charge alleged that during 2007, Dillon and others defrauded a bank in connection with a mortgage for 2295 Indian Mill Creek Drive NW, in Grand Rapids Michigan. As a result of a series of false statements designed to defraud the lender, Dillon and his cohorts obtained approximately $850,000 which they used for their own purposes.
In delivering the 24-month sentence, Chief U.S. District Judge Paul L. Maloney emphasized that mortgage fraud is a serious crime that undermines our financial system and hurts ordinary citizens by driving down property values. The prison sentence will be followed by three years’ supervised release.
“Mortgage fraud, like many financial crimes, threatens the financial health of our communities,” said Carolyn Weber, Acting Special Agent in Charge, IRS Criminal Investigation. “IRS Criminal Investigation will work diligently with the U.S. Attorney and our law enforcement partners to ensure that those who participate in these illegal activities are investigated and brought to justice.”
The FBI and IRS investigated the case as part of the Western District of Michigan’s Mortgage Fraud Task Force. This group was created to investigate and prosecute the growing number of mortgage fraud cases that have recently come to light. Assistant U.S. Attorney Timothy P. VerHey prosecuted this case.
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Gloucester County, N.J., Man Arrested, Charged in Alleged Mortgage Foreclosure Rescue, Real Estate Ponzi SchemeRead the Press Release
CAMDEN, N.J. – A Gloucester County, N.J., man is charged with scamming distressed homeowners into giving him their houses and then soliciting fake real estate investments from private investors – secured by those same properties – that netted him more than $3 million in illicit profits, U.S. Attorney Paul J. Fishman announced.
Randy Poulson, 42, of Woolwich Township, N.J. – the owner and operator of Equity Capital Investments LLC – was arrested this morning by special agents of the Philadelphia FBI. Poulson was arrested on a complaint charging him with mail fraud, which alleges the business he operated was actually a multimillion-dollar Ponzi scheme. Poulson is scheduled for an initial appearance and bail hearing this afternoon before U.S. Magistrate Judge Anne Marie Donio in Camden federal court.
According to the complaint unsealed today:
Poulson engaged in a two-pronged scheme. First, he promised to pay the mortgages of distressed homeowners facing foreclosure if they sold their homes to him – for no other compensation. Using this method, Poulson obtained the deeds to more than 25 distressed homeowners’ residences, causing them to vacate the homes so renters could move in. Poulson then stopped making the monthly mortgage payments, causing those mortgages to go into foreclosure without the distressed homeowners’ knowledge.
In the second prong of the scheme, Poulson successfully solicited more than 50 private investors into his companies – including Equity Capital Investments, which purportedly bought and sold real estate. Poulson explained to the investors that their money would be used to acquire and rehabilitate properties, which Poulson claimed he would rent out and then sell for a 10 to 20 percent return on the investment. In order to give the impression that Equity Capital Investments was a legitimate business, Poulson provided investors with fake mortgages and promissory notes for residential properties he claimed to be purchasing, renting and reselling. In support of the scheme, Poulson gave three weekend-long seminars, numerous speeches at monthly dinners and various, private tutorial sessions purporting to teach real estate investing tips to individuals who paid fees to attend. Poulson was the former president of the South Jersey Real Estate Investment Club.
The properties for which Poulson solicited private investments were the properties he acquired from the distressed homeowners. In reality, Poulson spent the investments on personal expenses and to partially repay previous investors in Ponzi-scheme fashion. Poulson spent some of the investors’ money on Ray’s Pizza, Acme, Exxon/Mobil, Jos. A. Bank, DirecTV, Hollywood Grooming, Kiddie Garden, Philadelphia Union tickets, American Express, Studio 122 (a hair salon), The Disney Store, Toys ‘R Us, Wawa, and rent-to-own payments on a personal beach house located in Ventnor, N.J.
The investigation to date has uncovered more than $3 million in investor losses as a result of Poulson’s schemes.
The mail fraud count which with Poulson is charged carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special
Agent in Charge Edward J. Hanko in Philadelphia, for the investigation leading to today’s complaint.The government is represented by Attorney in Charge R. Stephen Stigall of the U.S. Attorney’s Office Criminal Division in Camden.
The charge and allegations contained in the complaint are merely accusations and the defendant is considered innocent unless and until proven guilty.
14-168
Defense counsel: Richard Coughlin Esq., Camden
Poulson, Randy Complaint
Gang Member Sentenced on Drug and Gun ChargesRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Jacob Rivera, a/k/a “JJ,” 20, who was convicted of conspiracy to distribute more than 280 grams of cocaine base, and possession of a firearm in furtherance of his drug trafficking activities, was sentenced to 17 years in prison by U.S. District Judge Frank P. Geraci.
Assistant U.S. Attorney Douglas E. Gregory, who is handling the case, stated that the defendant, along with several others, was part of a violent, street level drug trafficking organization that referred to themselves as “M.D.B.”, or “The Broezel Boys.” From 2010 until their arrest in the summer of 2013, members and associates of MDB operated an open air drug market in a multi block area near the intersection of Dewey and Lexington Avenues, including all of Broezel Street, the north end of Maryland Street, portions of Driving Park and portions of Lakeview Park, in Rochester.
M.D.B. members and associates also maintained several drug houses in Rochester, including the duplex residence at 325/327 Lexington Avenue, the upstairs apartment at 171 Maryland Street, the upstairs apartment at 316 Lakeview Park and 672 West Main Street, each for the purpose of possessing, manufacturing, distributing, and using controlled substances.
Rivera possessed firearms in furtherance of his drug trafficking activities and used violence and threats of violence against unaffiliated persons who attempted to sell illegal controlled substances within their territory and against certain witnesses who were viewed as hostile to the interests of M.D.B.
The sentencing is the culmination of an investigation on the part of the Special Agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon, New York Field Office, the Rochester Police Department, under the direction of Chief Michael Ciminelli, the Federal Bureau of Investigation, and the Drug Enforcement Administration, under the direction of Jamie J. Hunt, Acting Special Agent in Charge, New York Field Division.Four Men Charged with Synthetic Drug DistributionRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III today announced the unsealing of a federal indictment charging four individuals with crimes relating to the distribution of synthetic cannabinoids. The indictment charges Ali El Khateeb (45, Tampa), Al Eddin Khaled (23, Wesley Chapel), and George Challita (56, New Orleans, LA) with conspiring to distribute and the distribution of AM-2201, a controlled substance analogue. El Khateeb, Khaled, and Anwar Gaber (31, Tampa) are also charged with conspiring to distribute and distribution of the controlled substance XLR-11. If convicted, each offense carries a maximum penalty of 20 years in federal prison. The indictment also seeks forfeitures, including a money judgment in the amount of approximately $5.9 million.
Corporate filings reveal that Khaled is associated with a business known as Wild Incense, located 4401 E. 10th Avenue in Tampa. This location was the focus of a search warrant that was executed on July 25, 2012, the date of nationwide enforcement actions relating to the distribution of smokable synthetic cannabinoids.
An analogue substance has a substantially similar chemical structure and effect as a controlled substance. The Controlled Substance Analogue Enforcement Act of 1986 (CSAEA) allows many of these drugs to be treated as controlled substances if they are proven to be chemically and/or pharmacologically similar to a Schedule I or Schedule II controlled substance. When intended for human consumption, analogues are treated in the same fashion as the controlled substance and provide law enforcement with a means to keep pace with the rapidly changing environment surrounding the distribution of chemicals used to replace outlawed substances.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This indictment is the result of a long-term Organized Crime Drug Enforcement Task Force (OCDETF) investigation involving the joint participation of numerous law enforcement agencies in the Tampa Bay area and nationwide. The agencies involved include the Drug Enforcement Administration in Tampa, Gainesville, Los Angeles, New Orleans, and Milwaukee, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, U.S. Marshals Service, Hillsborough County Sheriff’s Office, Pinellas County Sheriff’s Office, Tampa Police Department, Pasco County Sheriff’s Office, Ocala Police Department, Gainesville Police Department, Alachua County Sheriff’s Office, Levy County Sheriff’s Office, Union County Sheriff’s Office, Columbia County Sheriff’s Office, and Marion County Sheriff’s Office. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
(Download Factual Basis )
Former Subway Franchise Owner Pleads Guilty to Gift Card Hacking Scheme at Subway RestaurantsRead the Press Release
WASHINGTON – A California man pleaded guilty today in the District of Massachusetts for his role in a conspiracy to hack into the computerized cash registers of a number of Subway restaurants to fraudulently obtain more than $40,000 in gift cards.
Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division, U.S. Attorney Carmen M. Ortiz of the District of Massachusetts and Resident Agent in Charge Holly Fraumeni of the U.S. Secret Service in Manchester, New Hampshire, made the announcement.
Shahin Abdollahi, aka Sean Holdt, 46, of Lake Elsinore, California, pleaded guilty before U.S. District Judge Richard G. Stearns to one count of conspiracy to commit computer intrusion and wire fraud and one count of wire fraud. Sentencing is scheduled for Aug. 6, 2014. Abdollahi, along with his co-conspirator, Jeffrey Wilkinson, 37, of Rialto, California, was indicted on March 6, 2013. Wilkinson pleaded guilty on Feb. 27, 2014, and is scheduled for sentencing on May 28, 2014.
Prosecutors informed the court that had the case proceeded to trial, the government would have proven that Abdollahi owned Subway franchises in Southern California from 2005 to 2008 and later operated a California company called “POS Doctor,” which sold and installed point-of-sale (POS) computer systems to Subway restaurant franchises around the country. POS systems are a type of computerized checkout register that allows merchants to manage customer purchases made by credit, debit and gift cards.
Beginning in approximately 2011, Abdollahi and Wilkinson conspired to remotely hack into POS systems in Subway restaurant franchises around the country. Members of the conspiracy hacked into at least 13 Subway POS systems that Abdollahi sold through POS Doctor and fraudulently added at least $40,000 in value to Subway gift cards. Abdollahi and Wilkinson used the fraudulent gift cards to make purchases at Subway, and Wilkinson also sold fraudulent gift cards to others using eBay and Craigslist.
The case is being investigated by the U.S. Secret Service. The case is being prosecuted by Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam J. Bookbinder of the District of Massachusetts.
Former Subway Franchise Owner Pleads Guilty <br /> to Gift Card Hacking Scheme at Subway RestaurantsRead the Press Release
A California man pleaded guilty today in the District of Massachusetts for his role in a conspiracy to hack into the computerized cash registers of a number of Subway restaurants to fraudulently obtain more than $40,000 in gift cards.
Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division, U.S. Attorney Carmen M. Ortiz of the District of Massachusetts and Resident Agent in Charge Holly Fraumeni of the U.S. Secret Service in Manchester, New Hampshire, made the announcement.
Shahin Abdollahi, aka Sean Holdt, 46, of Lake Elsinore, California, pleaded guilty before U.S. District Judge Richard G. Stearns to one count of conspiracy to commit computer intrusion and wire fraud and one count of wire fraud. Sentencing is scheduled for Aug. 6, 2014. Abdollahi, along with his co-conspirator, Jeffrey Wilkinson, 37, of Rialto, California, was indicted on March 6, 2013. Wilkinson pleaded guilty on Feb. 27, 2014, and is scheduled for sentencing on May 28, 2014.
Prosecutors informed the court that had the case proceeded to trial, the government would have proven that Abdollahi owned Subway franchises in Southern California from 2005 to 2008 and later operated a California company called “POS Doctor,” which sold and installed point-of-sale (POS) computer systems to Subway restaurant franchises around the country. POS systems are a type of computerized checkout register that allows merchants to manage customer purchases made by credit, debit and gift cards.
Beginning in approximately 2011, Abdollahi and Wilkinson conspired to remotely hack into POS systems in Subway restaurant franchises around the country. Members of the conspiracy hacked into at least 13 Subway POS systems that Abdollahi sold through POS Doctor and fraudulently added at least $40,000 in value to Subway gift cards. Abdollahi and Wilkinson used the fraudulent gift cards to make purchases at Subway, and Wilkinson also sold fraudulent gift cards to others using eBay and Craigslist.
The case is being investigated by the U.S. Secret Service. The case is being prosecuted by Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam J. Bookbinder of the District of Massachusetts.Former Murray County Judge IndictedRead the Press Release
ROME, Ga. – Former Murray County Chief Magistrate Judge Bryant L. Cochran has been indicted for sexually assaulting a county employee, for framing a woman who alleged that she had been sexually propositioned by Cochran, and for tampering with a witness.
“Cochran is charged with crimes that reflect that he completely abused the power and trust given to him by the people of Murray County,” said United States Attorney Sally Quillian Yates. “First, he attempted to use his judicial position to solicit sexual favors from a female citizen. And, once the alleged misconduct came to light, Cochran tried to use his power and influence to cover up the incident by having the citizen framed for drug possession and by tampering with a witness.”
J. Britt Johnson, Special Agent in Charge, FBI Atlanta Field Office, stated: “This latest indictment brings to light additional details of an orchestrated scheme full of false allegations lodged against one citizen but, in the end, costing the careers and reputations of those public servants making them. The FBI will continue to work with its various law enforcement partners in investigating all matters regarding public corruption.”
“It is important for citizens to have confidence in public officials, especially those entrusted with upholding and enforcing the law. The indictment of Cochran shows that people in these positions will be held accountable when they are involved in criminal activity. The GBI is committed to work with our federal partners to insure those in a position of trust are held accountable,” said Vernon Keenan, Director, the Georgia Bureau of Investigation.
According to United States Attorney Yates, the charges, and other information presented in court: From January 1, 2004 to August 15, 2012, Bryant Cochran served as the Chief Magistrate Judge in Murray County, Ga. In that position, Cochran sexually assaulted a Murray County employee and unlawfully searched the personal cellular telephone of another Murray County employee.
In addition, on April 9, 2012, Cochran met with a female citizen regarding a legal matter. During the meeting, Cochran made inappropriate sexual advances towards the citizen. By mid-July 2012, the allegations of Cochran’s sexual misconduct towards the citizen had become public. In response, Cochran called several local police officers providing them with a “tip” – that the citizen carried drugs in her vehicle.
In an effort to discredit the citizen, on or about August 12, 2012, Clifford J. Joyce (who was a tenant of Cochran’s and who has been convicted of conspiring to distribute a controlled substance) planted a metal tin containing five packets of methamphetamine under the fender of the citizen’s car.
Two days later, on August 14, 2012, Murray County Sheriff’s Office Deputy Joshua Greeson (who has since been convicted of witness tampering) conducted a traffic stop on a car occupied by the citizen. During the traffic stop, several officers and a police drug dog searched the car for approximately 15 to 20 minutes – but did not find any drugs. Thereafter, Captain Michael Henderson (who is Cochran’s cousin and who has also been convicted of witness tampering) had an approximately two minute telephone conversation with Cochran. Following that call, Henderson told an officer at the scene that according to his information; the citizen hid her drugs in a magnetic box under the left, rear tire well. Upon receiving that information, Greeson found the metal box magnetically attached to the car in that precise location. Inside the box, Greeson recovered five small packets containing methamphetamine. Greeson then told the citizen that he had recovered drugs from her car. At that point, the citizen stated that she had been set up. Despite this, Greeson arrested the citizen and transported her to jail.
On August 15, 2012, the day after the arrest, Cochran resigned his position as Murray County’s Chief Magistrate Judge. On August 22, 2012, Joyce admitted to law enforcement officers that he planted drugs – after which the local District Attorney dismissed the charges against the woman. Finally, in an apparent effort to cover up the framing of the woman, Cochran tried to persuade a witness to provide false information to law enforcement officers.
On May 13, 2014, a federal grand jury indicted Cochran, 44, of Chatsworth, Ga. for: (1) Conspiracy against Rights; (2) Deprivation of Rights under Color of Law, (3) Conspiracy to Distribute a Controlled Substance, and (4) Tampering with a Witness. The most serious of the charges carries a maximum sentence of 20 years in prison and a fine of up to $250,000. In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
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.
This case is being investigated by the Federal Bureau of Investigation and Georgia Bureau of Investigation.
Assistant United States Attorneys Jeffrey W. Davis and William L. McKinnon Jr. are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Rome Division is http://www.justice.gov/usao/gan/.
Former Manager of Tutoring Company Sentenced in Manhattan Federal Court to 24 Months in Prison for Scheme to Bill Federal Government for Tutoring Services That Were Never ProvidedRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that MICHAEL LOGAN, a former manager of TestQuest, Inc. (“TestQuest”) — an educational services company that provided tutoring services to students attending underperforming public schools in New York City as part of a federally-funded program — was sentenced today in Manhattan federal court to 24 months in prison for his role in a scheme to defraud the federal government into paying for tutoring services that were never provided. LOGAN pled guilty in June 2013 before U.S. District Judge John F. Keenan, who also imposed today’s sentence.
Manhattan U.S. Attorney Preet Bharara said: “With today’s sentence Michael Logan must now pay with his liberty for exploiting a federal program meant to benefit students in need. I would like to thank the U.S. Department of Education’s Office of the Inspector General for their work in helping us to bring this important case.”
According to the Criminal Complaint, Information, and other documents filed in Manhattan federal court, as well as statements made at today’s sentencing and other proceedings:
Each year from 2005 through 2012, the New York City Department of Education (“NYCDOE”) received funds from the federal government to pay for New York City’s Supplemental Educational Services program (“SES”), which included after-school tutoring and other remedial and supplemental academic enrichment services for students attending underperforming public schools. NYCDOE entered into contracts with private entities and organizations to provide SES tutoring to public school students. Students were eligible to receive SES tutoring if they met certain criteria, such as attending a school that had been identified as needing improvement or restructuring for at least two years.
Private entities contracted by NYCDOE to provide SES tutoring were required to have each student who attended a class sign a standard attendance sheet. The tutor was also required to sign the sheet, attesting to the fact that he or she provided SES tutoring to those students whose names appeared on the sheet. Further, as a condition of getting paid for providing tutoring, the private entities were required to certify to NYCDOE that their attendance records were “true and accurate.”
From 2005 through 2012, TestQuest contracted with NYCDOE to provide SES tutoring. It provided individual tutoring to students at their homes and group tutoring at various New York City public schools, including the Monroe Academy of Business and Law/High School of World Cultures (“Monroe”) and the Global Enterprise Academy/Christopher Columbus High School (“Columbus”). TestQuest received tens of millions of dollars in federal funding for tutoring during this time period, including approximately $2.3 million for tutoring purportedly provided at Monroe and Columbus alone.
From 2005 through 2012, LOGAN was responsible for managing TestQuest’s SES tutoring program at Monroe and, later, at Columbus. LOGAN also worked as a long-term substitute teacher and computer technician at Monroe and, at times, coached its baseball team. From 2005 through 2012, LOGAN instructed TestQuest employees to forge student signatures on attendance sheets and to have students sign attendance sheets for tutoring classes they had not attended. On some occasions, he caused TestQuest employees to fraudulently obtain students’ signatures by collecting them from students assembled in the school cafeteria or participating in after-school activities such as baseball or basketball practice. LOGAN told these employees that they would not get paid if they did not collect signatures. One TestQuest employee (who did not actually provide any tutoring services for TestQuest but falsely certified that he had) periodically had conversations with LOGAN during which the employee asked what he was supposed to be doing, and LOGAN replied that the employee should tell anyone who asked that he was teaching English.
Further, when LOGAN learned of the criminal investigation, he coached other participants in the fraud to lie to federal investigators. In one recorded conversation, for example, LOGAN encouraged another TestQuest employee to lie about having taught classes that occurred when LOGAN and the employee were actually coaching after-school sports. As a result of LOGAN’s conduct, TestQuest employees repeatedly submitted bills to NYCDOE for tutoring that never occurred, and for which TestQuest was paid substantial sums of money.
In addition to the prison term, LOGAN, 50, of the Bronx, New York, was ordered to forfeit $250,000.
The case against LOGAN is part of a broader effort by this Office’s Criminal and Civil Divisions to hold SES providers and their employees accountable for fraudulent conduct. To date, this Office has brought coordinated proceedings against three New York City SES providers and their employees for falsifying attendance records and billing for tutoring they did not provide. In 2012 and 2013, this Office filed civil charges against The Princeton Review, Inc. (“Princeton Review”), and civil and criminal charges against several of its former employees. In 2013, this Office filed civil charges against TestQuest, and civil and criminal charges against several of its former employees, including LOGAN. In 2014, this Office filed civil charges against The Academic Advantage (“Academic Advantage”), and civil and criminal charges against several of its former employees. TestQuest settled the civil charges against it by admitting misconduct and agreeing to pay the Government $1.725 million. Princeton Review and Academic Advantage settled with the Government by admitting misconduct and committing to pay up to $10 million and $2 million, respectively. In addition to LOGAN, the following former employees of TestQuest, Princeton Review and Academic Advantage have pled guilty to criminal fraud charges, settled civil fraud charges, or both: Robert Stephen Green, Ana Azocar, Zorayma Azocar, Sandra Allen, Edwin Guzman and Luz Mercedes.
Mr. Bharara praised the investigative work of the U.S. Department of Education’s Office of Inspector General.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Joseph P. Facciponti and Christopher B. Harwood are in charge of the prosecution.
Former Financial Officer of New Jersey-Based Equipment Company Sentenced to 18 Months in Prison for Filing False Corporate and Personal Income Tax ReturnsRead the Press Release
CAMDEN, N.J. – A former financial officer and president of General Glass Equipment Company in Galloway, N.J., was sentenced today to 18 months in prison for concealing his actual income on corporate and personal tax returns, including more than $700,000 he failed to report in 2004, U.S. Attorney Paul J. Fishman announced.
Frank A. Dominico, 68, of Linwood, N.J., previously pleaded guilty before U.S. District Judge Noel L. Hillman to an indictment charging him with filing false income tax returns. Judge Hillman imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Between 2004 and 2009, Dominico worked as a financial officer for General Glass and prepared their corporate income tax returns. During that time he was promoted from treasurer to president of the company.
For each tax year between 2004 and 2008, Dominico admitted he filed returns which reported only a portion of his income and, in some years, overstated his itemized deductions.
For instance, Dominico admitted that for 2004 tax year, he listed his compensation from General Glass as $51,334 on his personal tax return and $89,822 on General Glass’s corporate federal income tax return. In fact, Dominico failed to report an additional $722,000 in compensation for the 2004 tax year, which resulted in a tax loss to the United States of $129,710.
In addition to the prison term, Judge Hillman sentenced Dominico to serve one year of supervised release and ordered him to pay restitution of $840,321.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Jason M. Richardson of the U.S. Attorney's Office Criminal Division in Camden.
Defense counsel: Lori M. Koch Esq., Assistant Federal Public Defender, Camden
14-172Former Fairmont State Official Sentenced to PrisonRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistELKINS, WEST VIRGINIA – A former vice-president at Fairmont State University has been sentenced to federal prison for stealing over $1.3 million dollars from the school.
United States Attorney William J. Ihlenfeld, II announced that David A. TAMM, age 45, of Parkersburg, West Virginia, was sentenced to 46 months in prison as a result of his convictions for “Embezzlement from State Agency Receiving Federal Funds” and “Making and Subscribing a False Tax Return for Tax Year 2012.” U.S. District Judge Irene Keeley imposed the punishment today at a sentencing hearing in Elkins.
TAMM, a former vice-president at Fairmont State University, was convicted of stealing funds from the school through the use of state-issued purchasing cards. TAMM admitted that from October of 2007 until January of 2013, he embezzled and stole funds from Fairmont State, including funds from federal education grants. TAMM, who served as Chief Information Officer at the school, also admitted to filing a false tax return for the 2012 tax year by reporting substantially less income than he had actually received.
The Court ordered TAMM to make restitution in the amount of $1,324,191.04 to Fairmont State University and $224,759 to the IRS for back takes. The Court also imposed a money judgment in the amount of $639,174.33. TAMM, who is on bond, will self-report to prison next month.
The investigation revealed that TAMM purchased hundreds of computer switches with purchasing cards and then resold them for cash. The cash was then used by TAMM to purchase luxury automobiles, a $435,000 home in Bridgeport, West Virginia, and other expensive items. TAMM also used a purchasing card to acquire high-end electronics for his personal use.
This case was prosecuted by Assistant United States Attorney Andrew R. Cogar and was investigated by the Federal Bureau of Investigation, the Internal Revenue Service-CI, the West Virginia Commission on Special Investigations and the Fairmont State University Police.
If anyone has information regarding public corruption in their community they are encouraged to call the West Virginia Public Corruption Hotline at 1-855-WVA-FEDS (1-855-982-3337), or to send an email to [email protected].
Former Dunmore Man Sentenced to Nine Years’ Imprisonment for Distributing HeroinRead the Press Release
The United States Attorney's Office for the Middle District of Pennsylvania announced today that United States District Court Judge Malachy E. Mannion has sentenced Kevin Lawrence Johnson, age 35, formerly of Dunmore, Pennsylvania, to nine years’ imprisonment for distributing heroin on numerous occasions between 2010 and May 2013 in Lackawanna County, Pennsylvania.
According to United States Attorney Peter J. Smith, Johnson routinely obtained heroin in Philadelphia and transported it to Lackawanna County for distribution with the assistance of street level dealers working for him. On September 4, 2013, Johnson appeared in federal court and pleaded guilty to heroin distribution. In doing so, he admitted to distributing more than 400 grams of heroin during the scheme. In addition to the nine-year term of imprisonment, Judge Mannion ordered that Johnson be placed under the supervision of the United States Probation Office for a period of three years following the service of his prison sentence.
The case was investigated by the Federal Bureau of Investigation, the Scranton Police Department, and the Lackawanna County District Attorney’s Office. Assistant United States Attorney John Gurganus prosecuted the case.
Former Commander of the Pacific Grove Police Department Pleaded Guilty to Extortion and Wire FraudRead the Press Release
SAN JOSE – John Nyunt pleaded guilty yesterday in federal court to extortion and wire fraud, announced United States Attorney Melinda Haag and FBI Special Agent in Charge David J. Johnson.
In pleading guilty, Nyunt admitted that he obtained property from a victim who came to the police department to report a crime. Specifically, Nyunt told the victim that the police department would not investigate her complaint that she was the victim of electronic surveillance and stalking. Instead of taking official action, Nyunt instructed the victim to seek the assistance of a private investigative agency. Nyunt ran said investigative agency with the assistance of another person. Upon receiving the request for assistance at his investigative agency, Nyunt and his accomplice pretended to investigate the victim’s complaint and also pretended to provide the victim with security in the form of off-duty police officers, neither of which was true. The victim paid Nyunt and his accomplice $10,000 for their purported services.
Nyunt also admitted that he instructed another Pacific Grove police officer not to make an official investigation of the victim’s complaint, and rather to give Nyunt any evidence provided by the victim. Nyunt maintained a file of this evidence without the knowledge of the police department. When the victim could make no further payments for the services of the investigative agency, Nyunt told her falsely that the police department and the FBI would continue to investigate her complaint.
Furthermore, Nyunt admitted that he gave his accomplice his departmental password, and access, to a commercial database intended for the sole use of law enforcement. He did so, without the authorization or knowledge of the police department, in order that his accomplice could obtain financial and personal information belonging to various other people. With Nyunt’s knowledge, his accomplice presented herself falsely as an authorized departmental user of the commercial database and did, in fact, obtain financial and personal information belonging to various people. Nyunt concealed this wrongful use from the department, in part by making false statements to department officials.
On April 24, 2014, Nyunt pleaded guilty in state court in Monterey County to one count of dissuading a person from reporting a crime by threats of violence, one count of being an accessory after the fact to theft and burglary, and one count of being an accomplice to the burglary of a business, all felonies, and received a sentence of three years imprisonment. Nyunt is currently being held in federal custody.
Nyunt, 51, was charged by information on April 24, 2014, with one count of extortion, in violation of 18 U.S.C. § 1951, and one count of wire fraud, in violation of 18 U.S.C. § 1343. Under the plea agreement, Nyunt pleaded guilty to both counts.
Nyunt’s sentencing hearing is scheduled for Sept. 2, 2014, at 9:00 a.m., before the Honorable Beth L. Freeman, United States District Court Judge, in San Jose. The maximum statutory penalty for each count in violation of 18 U.S.C. §§ 1951 and 1343 is twenty years’ imprisonment and a fine of $250,000, plus restitution. Pursuant to the binding plea agreement, if accepted by the court, the parties have agreed that the defendant should be sentenced to two years imprisonment, to run concurrent with his state sentence. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Philip A. Guentert is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Elise Etter. This investigation was conducted jointly by the FBI and investigators from the Monterey County District Attorney’s Office.
(Nyunt information )
Former Atascadero Real Estate Developer Pleads Guilty to Defrauding Investors in Central Coast-Based Real Estate Fraud SchemeRead the Press Release
LOS ANGELES – A real estate developer who formerly resided in Atascadero pleaded guilty today to federal fraud and money laundering charges for bilking investors who put money into Central Coast real estate projects.
Kelly Gearhart, 53, who currently resides in Wadsworth, Ohio, pleaded guilty this morning to two counts of wire fraud and one count of money laundering. Gearhart pleaded guilty before United States District Judge Otis D. Wright II.
In a plea agreement filed late yesterday, Gearhart admitted that he knowingly and intentionally made misrepresentations and omissions relating to the Vista Del Hombre real estate development project to induce victims to part with their money.
Gearhart was initially charged in a 16-count indictment returned by a federal grand jury in 2012. The indictment alleged that Gearhart told investors that their investments – which he called loans and promised would be paid back with interest – were secured by specific lots. However, Gearhart admitted in court today that he sold lots associated with the Vista Del Hombre real estate development project, even though those lots were being used to secure others’ loans. Gearhart further admitted that he used those same lots to obtain bank financing. The plea agreement allows prosecutors to prove at sentencing that Gearhart made additional misrepresentations as part of the scheme.
Gearhart is scheduled to be sentenced by Judge Wright on December 29. The wire fraud charges each carry a statutory maximum penalty of 20 years in federal prison. The money laundering count carries a statutory maximum penalty of 10 years in federal prison. During this morning’s court hearing, prosecutors said they intend to seek a sentence of 135 months in federal prison, while Gearhart’s attorney said he will not seek a sentence below 57 months. However, Judge Wright is free to sentence Gearhart up to the statutory maximum of 50 years in federal prison.
The plea agreement permits prosecutors to seek restitution for victims of the Vista Del Hombre real estate development project, as well as any other project in which there was fraud, a figure that may be as high as $20 million. It is unclear if there is any money available to repay victims.
The case against Gearhart is related to a case against James Hurst Miller Jr., the former president of the Atascadero-based Hurst Financial Corporation. Miller, who previously pleaded guilty to fraud and money laundering charges, is scheduled to be sentenced by Judge Wright on September 8.
The cases against Gearhart and Miller are the result of an investigation by the Federal Bureau of Investigation and IRS - Criminal Investigation.
Release No. 14-061
Florida Man Charged in Manhattan Federal Court in Connection with Multimillion-Dollar Real Estate Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in Charge of the New York Field Office (“FBI”), announced today that JOSEPH DEL VALLE, an owner and partner of various investment companies, including Vanquish Acquisition Partners LLC and PM Capital Management LLC, which were based in Manhattan, New York, surrendered this afternoon on charges of wire fraud and wire fraud conspiracy for operating a fraudulent scheme related to a Florida real estate development project. DEL VALLE is alleged to have obtained approximately $6.4 million from investors for a real estate development project in Miami, Florida. DEL VALLE allegedly took more than $3 million of the investors’ money and used it for other investments and his personal expenses. He will be presented in the United States District Court for the Southern District of New York today.
Manhattan U.S. Attorney Preet Bharara stated: “Joseph Del Valle solicited and obtained over $6 million from people who thought they were investing in a Miami real estate development. But, as alleged, Del Valle misappropriated much of that money, using it for his own purposes, including for hotels, restaurants, and a cruise. There are inherent market risks in most investments, but being swindled is not one that investors should have to bear.”
Assistant Director-in-Charge George Venizelos stated: “This is the same old song. Del Valle promised lucrative real estate investments, but what he delivered was a house of cards. We expect people to make money legitimately, not by stealing from others as alleged in today’s complaint.”
According to the allegations in the Complaint unsealed today in Manhattan federal court:
Beginning in 2005, JOSEPH DEL VALLE, a co-conspirator (“CC-1”), and an employee of Vanquish Acquisition Partners LLC, began soliciting investors for a real estate development project in the Little Havana neighborhood of Miami (referred to herein as “Project Miami”). Project Miami involved two high-rise buildings in which the bottom floors would house retail shops and the top floors would be residential condominiums. Project Miami was designed to provide affordable housing to middle-income individuals and included an arrangement for financing so that purchasers of the condominiums would receive government-subsidized mortgages. From 2005 through 2007, DEL VALLE, CC-1, and the employee obtained approximately $6.4 million from investors for Project Miami.
Prior to making any investments, investors were told that the investment was solely for Project Miami. Investors were provided with various materials that specified the investments were for Project Miami, and provided that DEL VALLE and his company would only take a five percent management fee. However, almost immediately after investors transferred funds for Project Miami, almost all of which were sent to banks in Manhattan, New York, DEL VALLE and CC-1 transferred amounts far greater than five percent to other bank accounts and began using the funds for other purposes, including investments in a wine magazine and for DEL VALLE’s personal use. For example, in October 2007, DEL VALLE used $30,000 of investor money in Europe for, among other things, hotels, restaurants, a cruise, and cash withdrawals. In total, DEL VALLE and CC-1 used over $3 million for other investments or personal expenses.
When investors became suspicious and requested financial statements for their investments and a return of their money, DEL VALLE represented to investors in phone calls and e-mail communications that the investment funds were secure when, in fact, a large portion of the investors’ money had already been misappropriated and/or diverted to other uses. DEL VALLE also falsely told investors that financial statements were in the process of being prepared and would be mailed to them shortly, but in fact, DEL VALLE and CC-1 had not provided any financial information to the accountant responsible for the preparation of financial statements of the relevant entities.
DEL VALLE, 59, of Aventura, Florida, has been charged with one count of conspiracy to commit wire fraud and one count of wire fraud, each of which carry a maximum potential penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the work of the FBI.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Parvin Moyne is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Del Valle, Joseph Complaint
Fenton Man Sentenced to 72 Months for Unlawful Possession of A FirearmRead the Press Release
St. Louis, MO –The United States Attorney's Office announced today that DERIC S. SILMAN of Fenton, Missouri, was sentenced today to 72 months for one felony count of Being a Previously Convicted Felon in Possession of a Firearm. He appeared before United States District Judge Stephen N. Limbaugh, Jr.
On March 9, 2013, a dispatcher for the Ellsinore Police Department received a telephone call from an individual stating Silman was at his residence and that Silman had pulled a pistol on him. Officers responded to the residence and found Silman inside and placed him under arrest. Officers searched the car that Silman had driven to the residence and located a loaded 9mm pistol under the driver’s seat.
Silman had previously been convicted of the felonies of stealing, knowingly burning, tampering in the first degree, resisting arrest, assault and possession of a controlled substance. As a convicted felon, Silman was prohibited from possessing firearms.The case was investigated by the Ellsinore Police Department and the Bureau of Alcohol, Tobacco, Firearms & Explosives. Assistant United States Attorney Larry H. Ferrell handled the prosecution for the Government.
Fenton Area Woman Sentenced for EmbezzlementRead the Press Release
St. Louis, MO – ELAINE LEWIS was sentenced to 27 months in prison for embezzling more than $300,000 from a church checking account, between 2009 and August 2013. In addition to the prison sentence, she was also ordered to pay restitution of more than $303,000.
According to court documents, Elaine Lewis worked as a bookkeeper for the Lutheran Church of the Resurrection, located in St. Louis County, Missouri. Between 2009 and August 2013, Lewis used a variety of schemes to embezzle more than $300,000 from the Church’s bank account at Bank of America. Most of the funds were transferred and deposited into a Commerce Bank account associated with her family’s business -- Advanced Lock & Key, Inc. -- which was operated out her residence in Fenton, Missouri.
Lewis, Fenton, Missouri, pled guilty in December to one felony count of mail fraud. He appeared today for sentencing before United States District Judge Rodney W. Sippel.
This case was investigated by the United States Postal Inspection Service and the Sunset Hills, Missouri, Police Department. Assistant United States Attorney John Bodenhausen handled the case for the U.S. Attorney’s Office.
Federal Grand Jury IndictmentsRead the Press Release
Contact Person: Beth Drake (803) 929-3000
Columbia, South Carolina ----- United States Attorney Bill Nettles stated today that a Federal Grand Jury in Charleston, South Carolina, returned Indictment(s) against the following: Aynor Man Indicted for Union Theft: Timothy Gamble, age 44, of Aynor, South Carolina, was charged in a 1-count Indictment with Theft of Union Funds, a violation of Title 29, U. S. C. §501(c). The maximum penalty that Gamble could receive is 10 years imprisonment and a maximum fine of $250,000. The case was investigated by agents of the Department of Labor and is assigned to Assistant United States Attorney Rhett DeHart of the Charleston office for prosecution.
Walterboro Man Indicted for Gun Charges: Rodney Faulkenberry, age 55, of Walterboro, South Carolina was charged in a 2-count Indictment with being a Felon in Possession of a Firearm and Possession of a Stolen Firearm, a violation of Title 18, U. S. C. § 922. The maximum penalty that Faulkenberry could receive is 15 years imprisonment and a maximum fine of $250,000. The case was investigated by agents of the Alcohol Tobacco and Firearms (ATF) and the Colleton County Sheriff’s Office and is assigned to Assistant United States Attorney Rhett DeHart of the Charleston office for prosecution.
The United States Attorney stated that all charges in these Indictments are merely accusations and that all defendants are presumed innocent until and unless proven guilty.Federal Employee Pleads Guilty to Stealing Government Property for Home Improvement ProjectsRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that VENITA GODFREY-SCOTT, 47, of New Haven, waived her right to indictment and pleaded guilty today before U.S. Magistrate Judge Donna F. Martinez in Hartford to one count of theft of government property, which she used for various home improvement projects.
According to court documents and statements made in court, GODFREY-SCOTT was employed by the U.S. Department of Veterans Affairs (“VA”) at the Medical Center in West Haven as a supervisor in the Facilities Management Service, which is responsible for carpentry, paint, locks, doors, and other minor construction projects at the Medical Center. From approximately 2010 until 2013, GODFREY-SCOTT directed VA employees that she supervised to perform home improvement projects at her private residence, including a deck in her backyard, carpet installation, and various kitchen, bathroom and basement improvements. GODFREY-SCOTT directed the employees to use materials, supplies, tools, and vehicles belonging to the VA, and also had the employees purchase necessary materials at local stores using her government-issued credit card. Some of the projects were performed during regular work hours.
The total loss to the government as a result of GODFREY-SCOTT’s criminal conduct is estimated to be between $15,000 and $20,000.
GODFREY-SCOTT is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny in Hartford on August 4, 2014, at which time she faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
This case is being investigated by the Department of Veterans Affairs Office of Inspector General, the Department of Veterans Affairs Police and the General Services Administration, Office of Inspector General, Office of Investigations, New England Regional Investigations Office in Boston. The case is being prosecuted by Assistant U.S. Attorney Neeraj N. Patel.
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(203) 821-3722 [email protected]Electrolux Agrees to Pay $750,000 Civil Penalty for Delay in Reporting Oven HazardRead the Press Release
The Justice Department’s Civil Division announced today that Electrolux Home Products Inc. (Electrolux), of Charlotte, North Carolina, has agreed to pay a civil penalty of $750,000 to settle allegations that it knowingly failed to report immediately to the U.S. Consumer Product Safety Commission (CPSC) a safety hazard associated with certain wall ovens sold to consumers. Electrolux has also agreed to establish and maintain a compliance program with internal recordkeeping and monitoring systems to keep track of information about product safety hazards.
“Manufacturers and distributors of consumer products are required to report product defects and hazards to the Consumer Product Safety Commission immediately and there are penalties for those who fail to do so,” said Stuart F. Delery, Assistant Attorney General for the Justice Department’s Civil Division. “We will continue to work with our partners at the CPSC to ensure that they can act promptly to protect consumers from injuries.”
In a complaint filed on behalf of the CPSC in U.S. District Court for the Southern District of Georgia, the United States alleged that Electrolux became aware of incidents in which gas could build up in the oven during broiling and escape and ignite, causing burn and fire hazards to consumers. Electrolux imported and distributed approximately 7,800 of the Kenmore ovens that were sold by Sears and other stores throughout the United States.
“CPSC will vigorously enforce the immediate reporting requirement found in the Consumer Product Safety Act,” said CPSC Acting Chairman Bob Adler. “The federal reporting rules are aimed at protecting the safety of the American public. Delay in reporting of product defects and hazards by manufacturers, distributors or retailers can result in civil penalties and other measures designed to ensure consumer safety.”
Under the Consumer Product Safety Act (CPSA), manufacturers, distributors, and retailers are required to report product hazards to the CPSC. A knowing violation of the CPSA subjects a firm to civil penalties. The United States alleged that between February 2006 and November 2007, Electrolux knew of 22 consumer reports of flames shooting out of the oven when the broiler was on. The incidents resulted in consumer injuries ranging from singed hair to facial burns. The United States alleged that Electrolux failed to immediately report hazards with the oven, despite the fact that Frigidaire Canada, Electrolux’s sister company, identified the defective and hazardous nature of the ovens in January 2005 and implemented a design change to fix the defect in March 2006.
“Public safety is a paramount concern,” said United States Attorney, Southern District of Georgia Edward J. Tarver. “The United States Attorney’s Office must and will continue to work together with the CPSC to protect consumers.”
During the relevant time period, Electrolux’s principal place of business was in Augusta, Georgia. A recall of the ovens was announced in 2008. In agreeing to settle this matter, Electrolux has not admitted that it knowingly violated the CPSA.
The matter is being handled by the Department of Justice’s Consumer Protection Branch and the U.S. Attorney’s Office for the Southern District of Georgia, on behalf of the Consumer Product Safety Commission.Eastern Distrct North Carolina Seafood Distributor Pleads Guilty to Tax EvasionRead the Press Release
WASHINGTON – Jeffrey Wayne Scott, 48, of Wilmington, North Carolina, pleaded guilty to tax evasion in Raleigh, North Carolina, the Justice Department and Internal Revenue Service (IRS) announced today. Scott was indicted on Nov. 25, 2013, for five counts of personal income tax evasion and one count of filing a false corporate tax return. He pleaded guilty to one count of willfully attempting to evade his personal income tax for tax year 2007.
According to court documents and court proceedings, Scott has owned and operated Greenville Loop Seafood (GLS), a seafood distribution company located in Wilmington, since 1995. For tax years 2006 through 2010, Scott and his wife filed joint individual income tax returns. Scott provided his return preparer with handwritten summaries of gross receipts and categorized expense items for the wholesale and retail fish distribution businesses as well as tax documents provided by financial institutions. Scott, under penalty of perjury, reported that his taxable income for these five years ranged between $23,934 and $92,999, and paid only $91,800 in federal income taxes for this time period. During these five years, however, the Scotts spent far in excess of this reported taxable income on personal expenditures.
According to court documents and court proceedings, between 2006 and 2010, the Scotts paid for nearly all of their living expenses with checks from GLS. This included, among other things, utilities, insurance premiums, landscaping, home improvements, school fees and a country club membership. They also purchased five vehicles totaling more than $200,000, a $100,000 boat and a $2.1 million waterfront home. Scott also made a monthly transfer of $10,000 from GLS’ business account into a personal brokerage account. After the purchase of their home in June 2009, Scott stopped transferring funds to the brokerage account, but instead used funds from GLS’ business account to pay the mortgage and related expenses. Through a bank deposit and expenditure analysis, the IRS calculated that Scott failed to report taxable income for these five years in excess of $1,151,642 and owed at least $390,678 in additional taxes. For the 2007 tax year, Scott failed to report $328,754 in taxable income with an additional tax due and owing of $113,967.
According to court documents and court proceedings, when first contacted by IRS-Criminal Investigation agents in June 2011, Scott falsely stated that he was letting friends stay in his second home rent free. Furthermore, despite being aware that he was under criminal investigation, in November 2012, Scott filed a false 2011 GLS corporate income tax return claiming the painting of his personal residence, repair work by a plumber at his personal residence, and health bills related to his family dog as business expenses.
Chief U.S. District Judge James C. Dever III scheduled the term of court to begin Aug. 18, 2014. Scott faces a statutory maximum prison term of five years and a maximum fine of $250,000.
This case was investigated by special agents of IRS-Criminal Investigation. Assistant U.S. Attorney Susan B. Menzer and Trial Attorney Todd A. Ellinwood of the Justice Department’s Tax Division are prosecuting the case.
Easley Man Pleads Guilty to Theft of Government FundsRead the Press Release
Contact Person: Bill Watkins (864) 282-2100
Columbia, South Carolina ----- United States Attorney Bill Nettles stated today that Tony Lee Holcombe, age 61, of Easley, South Carolina, pled guilty yesterday afternoon in federal court in Spartanburg, to theft of Government funds, a violation of Title 18, United States Code, Section 641. United States District Judge Mary G. Lewis of Spartanburg accepted the plea and will impose sentence after she has reviewed the presentence report which will be prepared by the U.S. Probation Office.
In July 2010, the Department of Veterans Affairs (“VA”) awarded Holcombe disability pension benefits for a non-service related impairment. Holcombe was declared permanently and totally disabled. In the letter informing Holcombe of his pension, the VA instructed Holcombe to report immediately if his income, status, or net worth increased or changed.
In September 2012, the VA received an anonymous complaint indicating that Holcombe was operating a construction business while receiving a disability pension. Agents investigated and found Holcombe on a job site where Holcombe was remodeling a home for a client. Holcombe admitted owning R&T Exteriors with another individual. He explained that “We mainly do siding, boxing, and metal roofs.” Holcombe indicated that he was a “silent” partner in the business and grossed a substantial amount of money.
Agents continued their investigation of Holcombe and talked to former employees, co-workers, and contractors who confirmed that Holcombe was working and receiving undisclosed income during the period he was receiving VA benefits for permanent and total disability.
The VA has calculated the overpayment amount as $33,470.00.
Mr. Nettles stated the maximum penalty Tony Lee Holcombe can receive is a fine of $250,000 and/or imprisonment for 10 years, plus a special assessment of $100.
The case was investigated by agents of the Department of Veterans Affairs, Office of the Inspector General. Assistant United States Attorney Bill Watkins of the Greenville office handled the case.EPA Requires Global Titanium Manufacturer to Investigate and Clean up PCB Contamination in NevadaRead the Press Release
Titanium Metals Corporation (TIMET), one of the world’s largest producers of titanium parts for jet engines, has agreed to pay a record $13.75 million civil penalty and perform an extensive investigation and cleanup of potential contamination stemming primarily from the unauthorized manufacture and disposal of PCBs (polychlorinated biphenyls) at its manufacturing facility in Henderson, Nevada, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today.
The penalty is the largest ever imposed for violations of the Toxic Substances Control Act (TSCA) at a single facility. TIMET will pay an additional $250,000 for violations related to illegal disposal of hazardous process wastewater, in violation of the Resource Conservation and Recovery Act (RCRA).
Under the settlement, EPA expects that the settlement will result in the removal of approximately 84,000 pounds of PCB-contaminated waste from the environment each year, and will prevent the improper disposal of 56 million pounds of hazardous waste each year.
“This settlement holds TIMET fully accountable for the period of its unauthorized manufacture and handling of harmful PCBs at the Henderson facility,” said Robert G. Dreher, Acting Assistant Attorney General for the Environment and Natural Resources Division. “It will also result in substantial environmental cleanup and protection for the benefit of residents of the area , now and in the future .”
“This record penalty reflects EPA’s commitment to protect communities by reducing pollution from the mineral sector,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “Today’s settlement ensures TIMET complies with the law and takes important steps to build transparency in the investigation and remediation of this facility.”
In addition to paying the penalty and performing the investigation and cleanup, the settlement requires TIMET to electronically submit monitoring data biannually to EPA for three years showing that it is appropriately managing any PCBs it generates. TIMET has also agreed to allow the Nevada Division of Environmental Protection (NDEP) to make public TIMET’s EPA-approved work plans and completed work reports through a dedicated website.
The company has already spent approximately $6 million on investigation, site cleanup and compliance measures to address the potential contamination. This work has included extensive sampling; draining and relining of a surface impoundment; analyzing the extent of PCB contamination in its solid waste landfill; removing PCB waste from that landfill; and decontaminating processing equipment. In addition, TIMET estimates that it will spend at least $1 million to complete the work required by the settlement.
TIMET processes titanium from rutile ore at its 108-acre manufacturing facility at the Black Mountain Industrial (BMI) Complex in Henderson. This process generates hazardous waste and PCBs. In the complaint, the government alleged that EPA inspections conducted in 2005, 2006 and 2008 revealed that TIMET had been unlawfully manufacturing PCBs as a by-product of its titanium manufacturing process, without an exclusion from TSCA’s ban. The 2008 EPA inspection also revealed that the company had disposed of PCB-contaminated waste in a solid waste landfill and a trench at the plant. The complaint further alleges that, on several occasions during 2005 and 2007, the company had unlawfully disposed of acidic, corrosive hazardous process wastewater into an unpermitted surface impoundment at the facility, in violation of RCRA.
Since 2007, the company has been working with EPA to bring the facility into compliance. TIMET has taken steps to reduce significantly the amount of PCBs it generates, manage appropriately the PCBs it does generate, and TIMET already has corrected the other regulatory violations cited in the complaint. TIMET is now in the process of documenting that it qualifies for an exclusion from TSCA’s ban on the manufacture of PCBs. As a part of that process, TIMET will provide required documentation to certify to EPA that it is in compliance with TSCA requirements governing the manufacture and disposal of PCBs.
TIMET was purchased by Precision Castparts Corporation in 2012. Both companies have worked with EPA to achieve compliance and to clean up the operations. The EPA and NDEP will continue to oversee multiple cleanup efforts at the facility and in the BMI Complex.
PCBs are human-made organic chemicals that were widely used in paints, construction materials, plastics, and electrical equipment prior to 1978. PCBs, which are probable carcinogens, have been banned in the United States for the last 30 years, except for specific uses authorized by regulations. When released into the environment, PCBs can persist for decades because they do not break down through natural processes. Exposure to PCBs has been demonstrated to cause cancer, as well as a variety of other adverse health effects on the immune system, reproductive system, nervous system, and endocrine system.
This settlement is part of EPA’s nationwide enforcement initiative to reduce pollution from mineral processing operations. Because mining and mineral processing facilities have the potential to generate large volumes of toxic and hazardous waste, the agency’s goal is to reduce the risk to human health and the environment by ensuring wastes from these facilities are properly managed.
TIMET, headquartered near Philadelphia, has been supplying nearly one-fifth of the world’s titanium demand since 1950. The company’s Henderson plant, which has been in operation since 1950, is one of the largest industrial facilities in the state. TIMET is a wholly-owned subsidiary of Precision Castparts Corporation, a worldwide manufacturer of complex metal components and products based in Portland, Oregon.
The consent decree, lodged in the U.S. District Court for the District of Nevada, is subject to a 30-day public comment period and approval by the federal court. The consent decree can be viewed at www.justice.gov/enrd/Consent_Decrees.html .
For more information on the settlement: http://www2.epa.gov/enforcement/timet-settlement# # #
Dexter Man Sentenced to 57 Months for Unlawful Possession of A FirearmRead the Press Release
St. Louis, MO – The United States Attorney's Office announced today that QUENTEN T. MARTIN of Dexter, Missouri, was sentenced today to 57 months for one felony count of Being a Previously Convicted Felon in Possession of a Firearm. He appeared before United States District Judge Stephen N. Limbaugh, Jr.
On May 16, 2013, officers responded to the Dexter Hospital in response to a citizen’s report that Martin was outside the hospital and in possession of a firearm. The officers located Martin and observed a .38 caliber Smith & Wesson revolver on the ground near him. Martin was arrested and admitted to the officers that he had thrown the gun down when he saw the officers.
Martin is a previously convicted felon and is prohibited from possessing firearms.
The case was investigated by the Dexter Police Department and the Bureau of Alcohol, Tobacco, Firearms & Explosives. Assistant United States Attorney Larry H. Ferrell handled the prosecution for the Government.
Defendant Ramachandran Vavivello Aka Vicraama Sarada Aka Vic Rama Sentenced Today in District Court of GuamRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that RAMACHANDRAN VADIVELLO aka VICRAAMA SARADA aka VIC RAMA (“VIC RAMA”), was sentenced today in the District Court of Guam by Chief Judge Frances Tydingco-Gatewood, to six months home confinement followed by five years probation. VIC RAMA was also ordered to pay restitution to the victims in this case in the amount of $117,197.29.
Defendant VIC RAMA pled guilty on March 26, 2013, to the offenses of Mail Fraud, in violation of 18 U.S.C. § 1341, Visa Fraud, in violation of 18 U.S.C. § 1546(a), and Conspiracy to Commit Money Laundering, in violation of 18 U.S.C. § 371.
Defendant VIC RAMA is the owner of Transrama Guam, Inc., a construction company on Guam. VIC RAMA petitioned the Guam Department of Labor to hire ten (10) highly skilled H-2B alien workers from Malaysia and Indonesia. VIC RAMA misrepresented to the Guam Department of Labor that the H-2B alien workers would work as heavy equipment mechanics and carpenters on Guam, and that they would be paid the prevailing wage rates. Based on VIC RAMA’S representations, the Department of Labor and the Governor of Guam approved the employment of the H-2B workers. The U.S. Department of Homeland Security, U.S. Citizenship and Immigration Services then issued visas permitting the H-2B workers entry to work on Guam for one year.
Rather than employing the H-2B alien workers as heavy equipment mechanics and carpenters, VIC RAMA assigned the workers to perform manual labor which included irrigation work, landscaping and painting at the Leo Palace Resort. VIC RAMA also withheld full salaries from the alien workers and farmed the workers out to another local construction company, in violation of the terms of their admission to Guam.
U.S. Attorney Limtiaco states, “The U.S. Attorney’s Office is committed to holding accountable those defendants who attempt to erode the public’s trust in our government. Cases involving the abuse of H-2B alien workers and the H-2B approval process, are frauds committed against both local and federal government agencies. The U.S. Attorney’s Office will prosecute these cases and will make all efforts to restore the victim’s losses.”
The investigation was conducted by Special Agents with the U.S. Department of Homeland Security, Homeland Security Investigations, and the Internal Revenue Service – Criminal Investigation Section. The case was handled by Assistant U.S. Attorney Rosetta SanNicolas.
Defendant David Quichocho Uncangco, Jr. Sentenced Today in District Court of GuamRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that DAVID QUICHOCHO UNCANGCO, JR., was sentenced today by Chief Judge Frances Tydingco-Gatewood in the District Court of Guam, to 117 months incarceration followed by five years of supervised release. Defendant was also ordered to pay restitution to Submarina California Subs and Imma Mart.
Defendant UNCANGCO pled guilty on December 11, 2013, to the offenses of Hobbs Act Robbery in violation of Title 18 U.S.C. § 1951, and to Use of a Firearm During a Crime of Violence, in violation of Title 18 U.S.C. § 924(c)(1)(a).
On July 10, 2012, UNCANGCO entered Imma Mart, a retail store in Yigo, Guam. He pointed a silver Smith and Wesson .38 caliber revolver at the cashier and demanded money. The cashier handed over approximately $100 in cash to UNCANGCO who then fled the store. The robbery was captured on video surveillance.
Three days later, UNCANGCO approached a cashier at the Submarina California Subs store in Hagatña. He pointed a Smith and Wesson .38 caliber firearm at the cashier and demanded money. UNCANGCO forcibly took a Bank of Guam money bag containing approximately $1,200 cash and receipts from the cashier. Defendant then fled the scene in a Toyota pickup truck.
Law enforcement recovered the Smith and Wesson .38 caliber firearm, fifty rounds of .38 caliber ammunition and the Bank of Guam money bag from the Toyota pickup truck.
U.S. Attorney Limtiaco states, “The use of firearms to commit violent crimes places innocent civilians and the community at great risk of harm. People who use firearms to commit crimes of violence will face aggressive prosecution and will receive significant jail time.”
U.S. Attorney Limtiaco noted that this prosecution is part of the U.S. Department of Justice’s Project Safe Neighborhood (PSN) Initiative, a nationwide commitment to aggressively prosecute defendants who engage in violent crime, drug distribution and gang involvement. The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Guam Police Department. The case was handled by Assistant U.S. Attorney Rosetta San Nicolas.
Dealer Who Ordered Drugs in the Mail Sentenced in Federal CourtRead the Press Release
MOBILE, Ala. – Eric Dynell McGadney, 36, of Mobile, was sentenced today in federal court to 188 months imprisonment for his activities in arranging for the delivery of 144 pills of MDMA, commonly known as Ecstasy, to Mobile in the mail. Court documents reflect that the package McGadney ordered was identified at the United States Post Office by postal inspectors as suspicious. The postal inspectors arranged for a controlled delivery of the package, coordinating with members of the MCSENT unit, who assisted with surveillance and back-up during the delivery. McGadney had arranged for another subject to accept delivery of the package in a false name, but was present when the delivery was made. When law enforcement officers detained the subject who accepted delivery and McGadney, both were advised of their rights and agreed to answer questions. The subject who accepted delivery identified McGadney as the person who asked him to sign for the package. He consented to a search of the package, and the investigators found the MDMA concealed inside a bottle of children’s vitamins. McGadney told the investigators that the person who accepted delivery of the package for him was not involved in the drug delivery scheme. McGadney admitted that the bottle contained “Molly,” a street term for MDMA (Ecstasy), and that he was to deliver the drugs to another person in Mobile. McGadney pled guilty to the charges of possession with intent to distribute MDMA and use of an interstate facility, in this case the United States mail, to facilitate the commission of a drug trafficking felony in January of 2013.
At the sentencing hearing this morning, United States District Court Judge William H. Steele found that McGadney was a career offender under the United States Sentencing Guidelines, based upon two prior qualifying felony convictions for escape and possession of marijuana in the first degree. The judge ordered that McGadney serve 188 months imprisonment, to be followed by a six-year term of supervised release following the completion of his prison sentence. Judge Steele ordered that McGadney pay $200 in special mandatory assessments, but did not impose a fine.
The case was investigated by the United States Postal Inspection Service, MCSENT, the and the Mobile Police Department. It was prosecuted in the United States Attorney=s Office by Assistant United States Attorney Gloria Bedwell.
Davidson County Woman Sentenced for Filing False Tax Return and Aggravated Identity TheftRead the Press Release
GREENSBORO, N.C. – A Davidson County woman was sentenced to 39 months in prison for filing a false tax return and aggravated identity theft, announced United States Attorney Ripley Rand.
Veronica Levonne Jones, age 40, of Lexington, North Carolina pled guilty on December 2, 2013 and was sentenced on May 13, 2014. Chief United States District Judge William L. Osteen, Jr., sentenced Jones to a total of 39 months in federal prison, ordered her to pay $199,000 in restitution, and imposed one year of supervised released after she leaves prison.
Jones operated Tax Refund Solutions (TRS) in Lexington, North Carolina. During the operation of that business, Jones knowingly falsified her income and used the name and social security of another person on her tax return.
"During tax filing season, return preparers and taxpayers should be aware of the serious consequences facing those who aid or assist in the filing of fraudulent tax returns," said Acting Special Agent in Charge Daniel D. Burget, IRS-Criminal Investigation. "Those who fly in the face of the tax laws face investigation, prosecution, and if convicted, significant prison sentences and substantial fines."
The case was investigated by the Internal Revenue Service-Criminal Investigations and prosecuted by Assistant United States Attorney Stephen Inman.
David Renz Will Not Face A Federal Death Penalty ProsecutionRead the Press Release
SYRACUSE, NEW YORK – The U.S. Department of Justice has declined to authorize a death penalty prosecution against David Renz in connection with a potential federal carjacking charge and the resulting murder of Lori Bresnahan on March 14, 2013, announced United States Attorney Richard S. Hartunian. The death penalty cannot be sought in any federal prosecution without prior written authorization of the Attorney General. Renz will now be sentenced in Onondaga County Court to imprisonment for life without parole based upon his pleas of guilty to first degree murder and predatory sexual assault against a child.1
United States Attorney Richard S. Hartunian stated, “No sentence that could ever be imposed in this case will undo the tragic death of Lori Bresnahan or the pain inflicted on the young victim, or adequately account for the depravity of the crimes committed. The mandatory life sentence in state court and the imposition of an additional 30 year federal consecutive sentence will insure that David Renz can do no further harm.”
All federal criminal prosecutions that carry a potential sentence of death are thoroughly reviewed pursuant to a detailed protocol established by the Department of Justice and involve careful consideration of applicable statutory mitigating and aggravating factors, the federal interest, and all the relevant facts and circumstances. The United States Attorney assembles and analyzes the evidence and applicable law, defense counsel is afforded an opportunity to submit matters in opposition to the death penalty, and the victim’s family is consulted and the views of family members taken into consideration. Following review by the Department’s Capital Case Section, the matter is forwarded to a committee of senior Justice Department lawyers, the Attorney General’s Capital Case Review Committee. The Review Committee then makes its recommendation to the Attorney General, who makes the final decision regarding whether to seek the death penalty.
For further information contact Executive Assistant United States Attorney John G. Duncan at (315)448-0672.
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1On April 10, 2013, an Onondaga County grand jury returned a 37-count indictment that charged Renz with kidnapping, rape, criminal sexual act, murder, and sexual assault related to the attack and murder. On July 17, 2013, Renz entered a plea of guilty in New York State court to first-degree murder and predatory sexual assault against a child, with an agreed-upon sentence of life imprisonment without the possibility of parole. Renz and the Onondaga County District Attorney’s Office agreed that Renz could withdraw his state guilty plea if the federal government sought the death penalty against him.
Criminal Immigration Charges Brought Against Three Illegal AliensRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania and U.S. Immigration and Customs Enforcement (ICE) Enforcement and Removal Operations (ERO), announced today that charges in three unrelated cases have been brought against the following persons by a federal grand jury in Harrisburg:
Santiago Ortiz-Ortiz, age 49, a native and citizen of Mexico in the United States illegally, was charged in a one-count indictment alleging that Ortiz-Ortiz, an alien previously arrested and deported, knowingly and unlawfully reentered the United States. He was located by federal immigration agents in York County, Pennsylvania.
If convicted, Ortiz-Ortiz faces a maximum sentence of up to 10 years of imprisonment and a $250,000 fine.
Claudio Villa-Vera, age 26, a native and citizen of Ecuador in the United States illegally, was charged in a one-count indictment alleging that Villa-Vera, an alien previously been arrested and deported knowingly and unlawfully reentered the United States and was apprehended in York, Pennsylvania.
If convicted, Villa-Vera faces a maximum sentence of up to two years’ imprisonment and a $250,000 fine.
Jose Gonzalez-Sanchez, age 25, a native and citizen of Mexico, in the United States illegally, was charged in a one-count alleging that Gonzalez-Sanchez, an alien previously been arrested and deported knowingly and unlawfully reenter the United States and was apprehended in Franklin, Pennsylvania.
If convicted, Gonzalez-Sanchez faces a maximum sentence of up to two years’ imprisonment and a $250,000 fine.
The investigations were conducted by ICE Enforcement and Removal Operations (ERO) Philadelphia and are being prosecuted by Special Assistant United States Attorney Brian G. McDonnell.
Conway Business Owner Pleads Guilty to Structuring A Financial TransactionRead the Press Release
LITTLE ROCK, AR – Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas; Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation Nashville Field Office; announced that Patrice Duncan, age 59, of Conway, pled guilty May 5, 2014, before United States District Judge Jay Moody. Duncan pled guilty to one count of structuring a financial transaction, of more than $10,000 in cash to evade the reporting requirements banks have to report to the United States Treasury when there is a cash deposit of more than $10,000.
“Structuring financial transactions to avoid currency reporting requirements is a criminal violation of federal law under the Bank Secrecy Act (BSA). Deliberately avoiding BSA requirements is a form of money laundering that will be vigorously investigated by IRS Criminal Investigation.”
Patrice Duncan was indicted by a federal grand jury on September 5, 2012 on 21 counts of structuring financial transactions. She pled to Count 21 of the Indictment. The remaining counts against Duncan were dismissed. Patrice Duncan is one of the owners of Duncan Outdoor in Conway. In September and October 2011, an undercover (UC) agent of the IRS-Criminal Investigations went to Duncan Outdoor and purchased a motorcycle with cash. The undercover agent, who was wearing a recording device, discussed paying in cash so that the bank and government would not know of the transaction. Patrice Duncan was recorded discussing with the UC agent that she would not deposit all the money at one time so that the bank wouldn’t fill out the forms that document transactions over $10,000. On October 25, 2011, Duncan deposited $9,400 cash from the UC agent’s purchase. A few days later, on October 28, 2011, Patrice Duncan deposited the remaining $2,000 cash from the UC agent’s purchase.
Structuring has a statutory maximum of not more than five years in prison and/or not more than a $250,000 fine followed by not more than three years of supervised release.
A sentencing date will be set by the Court at a later date. Gary Duncan, Patrice Duncan’s husband, was also indicted on the structuring charges. His trial will be continued.
The maximum sentence for bank fraud is not more than 30 years imprisonment, not more than a $1,000,000 fine and/or not more than five years of supervised release.
The case was investigated by special agents from the IRS-Criminal Investigations. The case is being prosecuted by First Assistant United States Attorney Pat Harris.
Carbondale Man Charged with Firearm OffenseRead the Press Release
Follow @SDILNewsOn May 6, 2014, a federal grand jury returned a one-count indictment charging Travis D. Bailey, 30, of Carbondale, Illinois, with Possession of a Firearm by a Felon, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. On May 13, 2014, Bailey made his initial appearance in federal court in Benton. Bailey is currently being held without bond pending a July 14, 2014, jury trial.
The offense occurred on March 7, 2014, in Carbondale, Jackson County. The firearm offense carries a penalty of up to 10 years in federal prison, to be followed by 3 years of supervised release, and a fine of $250,000.
Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The ongoing investigation is being conducted by the Carbondale Police Department. The Jackson County State’s Attorney’s Office also assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
California Woman Sentenced to Seven Years in Prison for Sixteen Million Dollor Mortgage Fraud SchemeRead the Press Release
PENSACOLA, FLORIDA – United States Attorney Pamela C. Marsh announced the sentencing today of Andrea Lorraine Avery, 47, of Los Angeles, California, following acceptance of her guilty plea in December of last year. Avery pleaded guilty to seven counts that included: conspiracy to commit fraud, five counts of mail fraud affecting a financial institution, and conspiracy to commit money laundering. Avery was sentenced to 84 months in prison and ordered to pay restitution in the amount of $10,323,369 to the FDIC as Receiver for Washington Mutual, GMAC Mortgage, SunTrust Mortgage, Wells Fargo Bank, USBank, and others.
Avery admitted that beginning in 2005 and continuing through 2008, she and others entered into contracts to purchase twenty-four residences located in Florida, Georgia, Louisiana, Texas, and California. As a part of the fraudulent scheme, numerous properties located in the Northern District of Florida were purchased, which included homes in Navarre, Santa Rosa Beach, and Panama City. Thereafter, fraudulent loan applications were submitted to financial institutions to fund the purchases. In the loan applications, Avery and other borrowers made false statements to the lenders, which included: providing false names and social security numbers; overstating the borrower’s income and assets; and falsely stating the earnest money deposit was not borrowed. In support of the loans, Avery and other borrowers submitted fraudulent supporting documents to the lenders, which included: false pay-stubs, false W-2s, false verifications of employment, and false documentation concerning the borrower’s credit. Approximately $16 million in loans were issued by the lenders in connection with the fraudulent scheme. Avery and her company received more than $3.5 million in kickbacks as a result of the scheme.
The charges are the result of an investigation by the Florida Department of Law Enforcement, the Internal Revenue Service – Criminal Investigation, and the Federal Bureau of Investigation. This case was prosecuted by Assistant U.S. Attorney Tiffany H. Eggers.
California Man Pleads Guilty to Online Enticement of A West Michigan ChildRead the Press Release
GRAND RAPIDS, MICHIGAN – Joseph Arpin, 34, pled guilty yesterday in federal court to online enticement of a West Michigan child. Arpin stated at the plea hearing that he met the 12-year-old victim online, he assumed a false identity to entice her, and he moved across the country from California to Michigan to start a sexual relationship with her. Arpin faces a minimum prison term of 10 years, up to a maximum term of life. His sentencing hearing is set for September 3, 2014.
In addition to the online enticement from July to October 2013, the indictment also charged Arpin with traveling from California to Allegan County, MI, to engage in illicit sexual conduct with the child and then transporting her from Michigan to Missouri for the purpose of engaging in criminal sexual conduct. He was arrested in Missouri on October 22, 2013, and has been in custody ever since. In exchange for the plea to online enticement, the government agreed to dismiss the other two counts. Neither of the dismissed counts carried a higher possible penalty than the online enticement count to which Arpin pled guilty.
“We will make every effort to investigate, locate, and prosecute predators who use the internet to lure children into danger,” said U.S. Attorney Patrick Miles.
The charges are the result of an investigation conducted by the Federal Bureau of Investigation (FBI), the Allegan County Sheriff’s Office, the Holland Police Department, and the St. Louis County Police Department. Assistant United States Attorney Tessa K. Hessmiller is the prosecutor on the case.
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. The U.S. Attorney's Office; county prosecutor's offices; the Internet Crimes Against Children task force (ICAC); and federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate communities about the dangers of online child exploitation and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement.
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Bullhead Woman Sentenced for Assaulting, Resisting and Impeding A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Bullhead, South Dakota, woman convicted of Assaulting, Resisting, and Impeding a Federal Officer was sentenced on May 12, 2014, by U.S. District Judge Charles B. Kornmann.
Darla Yellow Earrings, age 49, was sentenced to 16 months of custody, 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Yellow Earrings was indicted by a federal grand jury on August 21, 2013. She pled guilty on November 18, 2013.
The conviction stems from an incident which happened on or about July 14, 2013, when an officer responded to assist another officer in locating a maroon colored Chevrolet Tahoe that was reportedly involved in a hit and run earlier that day. When the assisting officer entered the Bullhead community, he observed the Tahoe, driven by Yellow Earrings, and it was approaching his position at a high rate of speed. At the same time, the other officer’s vehicle was in pursuit of the Tahoe, and had its emergency lights activated. The assisting officer also activated his lights and sirens in an attempt to stop the vehicle. As the Tahoe continued towards the assisting officer, the vehicle crossed into his lane, still at a high rate of speed, and the officer had to accelerate rapidly and swerve to avoid being struck. The Tahoe refused to slow down and both officers joined in the pursuit and followed it to a private residence. Once the vehicle had stopped, they were able to place Yellow Earrings in custody.
This case was investigated by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Yellow Earrings was immediately turned over to the custody of the U.S. Marshals Service.
Bullhead Woman Sentenced for Assaulting, Resisting and Impeding A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Sioux Falls, South Dakota, man charged with Failure to Appear pled guilty and was sentenced on May 13, 2014, by U.S. Magistrate Judge Mark A. Moreno.
David Andrews, age 33, was sentenced to 6 months of custody to be served consecutive to the sentence imposed in another federal case, and a $25 special assessment to the Federal Crime Victims Fund.
Andrews was indicted on July 18, 2012, for Possession with Intent to Distribute a Controlled Substance. He appeared with his attorney in front of U. S. Magistrate Judge Mark Moreno on August 6, 2012, and was detained.
On February 21, 2013, Andrews pled guilty to a Superseding Information charging him with Possession of a Controlled Substance. During the change of plea hearing, Andrews was notified that sentencing was scheduled for Monday, May 6, 2013, at the U.S Courthouse in Pierre. Following the change of plea hearing, Andrews was released on a Personal Recognizance Bond pending sentencing. He signed the Order Setting Conditions of Release on February 22, 2013, indicating he understood that failure to appear for court could lead to prosecution, and that he needed to appear as directed by the Court.
Andrews failed to appear on May 6, 2013, as directed, and the Court noted his absence at the sentencing hearing. The District Court allowed Andrews an additional 24 hours to appear, but he failed to do so. His whereabouts were unknown until February 19, 2014, when he was arrested in Sioux Falls.
The investigation was conducted by the U.S. Marshals Service. The case was prosecuted by Assistant U.S. Attorney Jay Miller.
Andrews was remanded to the custody of the U.S. Marshals Service.
Buffalo Man Charged with Social Security FraudRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr., announced today that Ari Elias Baum, 29, of Buffalo, N.Y., was arrested and charged by criminal complaint with making a false statement to the Social Security Administration (SSA) and withholding material information from the agency concerning his eligibility to receive disability benefits. Each charge carries a maximum penalty of five years in prison and a fine of up to $250,000.
Assistant U.S. Attorney Paul J. Campana, who is handling the case, stated that according to the complaint, in 2010, the defendant’s Social Security benefits were discontinued after it was determined Baum was outside the United States for a period exceeding 30 consecutive days. The complaint alleges that in December 2010 and again in March 2013, Baum was advised of his obligation to report to the SSA if he was outside the United States for 30 or more consecutive days.
According to border crossing records, the defendant was outside of the country continuously from March 22, 2013, until August 13, 2013. When contacted by the SSA on December 91, 2013, Baum failed to mention this to the agency. The complaint alleges that Baum left the United States again on January 1, 2014, and did not return until May 13, 2014. The defendant’s absence from the United States resulted in an overpayment of Social Security benefits exceeding $6,400.
Baum made an initial appearance on May 13, 2014 before U.S. Magistrate Judge Jeremiah J. McCarthy, who ordered the defendant detained pending a detention hearing scheduled for Thursday, May 15, 2014, at 1:30 pm.
The fact that a defendant has been charged with a crime is merely an accusation, and the defendant is presumed innocent until and unless proven guilty.
The complaint is the result of an investigation on the part of the United States Social Security Administration, Office of the Inspector General, under the direction of Special Agent-in-Charge Edward J. Ryan and the Federal Bureau of Investigation.Brunswick Man Convicted of Illegally Receiving $3 Million in Credit Union CollapseRead the Press Release
A Brunswick man was convicted of 14 counts related to illegally receiving more than $3 million from the St. Paul Croatian Federal Credit Union in exchange for cash payments to the credit union’s chief operating officer, law enforcement officials said.
Svetislav Vujovic, 41, is scheduled to be sentenced on August 19.
Following a weeklong trial in U.S. District Court in Cleveland, a jury convicted Vujovic on all 14 counts – 10 counts of making false statements to a federal credit union, two counts of money laundering and one count each of financial institution fraud and giving gifts for procuring loans.
The credit union was closed and then liquidated in 2010 after sustaining losses of approximately $170 million, making it one of the largest credit union failures in American history. Nearly 20 people have been convicted of crimes related to fraudulent lending that resulted in the credit union’s failure.
“The failure of the credit union was a tragedy for this community,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “We will make sure all those responsible for its failure will be held accountable.”
Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Field Office, said: “The St. Paul Federal Credit Union collapse resulted in one of the largest credit union failures ever investigated in U.S. history. This complex, large-scale investigation transcended international borders and will continue until all those involved are brought to justice.”
“Honest and law-abiding citizens are fed up with the likes of those who use deceit and fraud to line their pockets with other people’s money,” said Special Agent in Charge Kathy Enstrom, IRS Criminal Investigation, Cincinnati Field Office. “Let this conviction stand as a warning to those who victimize the public that whether you are the main perpetrator of a fraud, or assist in its facilitation, the law will hold all guilty parties accountable.”
Vujovic, aided and abetted by Anthony Raguz, the former Chief Operating Officer of Eastlake-based St. Paul Croatian Federal Credit Union, received numerous fraudulently obtained loans totaling approximately $3 million from the credit union between 2004 and 2008, according to court documents and trial testimony.
Vujovic obtained these loans by making false representations and promises, and he received many of those loans after having already defaulted on previous loans issued to him by the credit union. These loans were obtained in the names Cleveland Comfort Corp; SND, Inc.; Balkan Contracting; GBRS Properties, LLC; and Balkan Enterprise, Inc. The credit union lost approximately $3 million as a result of Vujovic’s fraudulent conduct.
Vujovic corruptly gave Raguz cash payments totaling approximately $20,000 to induce and reward Raguz for approving and facilitating the approval of the fraudulent loans to Vujovic, , according to court documents and trial testimony.
Raguz is currently serving a 14-year federal prison sentence.
This case is being prosecuted by Assistant U.S. Attorney Bridget M. Brennan and United States Attorney Steven M. Dettelbach following an investigation by the Cleveland Offices of the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation Division.
Brian Leon Guerrero Sentenced in the District Court of GuamRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that Defendant BRIAN LEON GUERRERO, age 25, from Tamuning, was sentenced on May 13, 2014, in the District Court of Guam by Chief Judge Ramona Manglona, for the offense of Dealing in Counterfeit United States Obligations and Securities, for his role in passing a counterfeit fifty dollar bill on October 24, 2013. LEON GUERRERO was sentenced to a three-year probationary period, and ordered to get substance abuse treatment and obtain a high school diploma or GED. Defendant was also ordered to pay $500 restitution, a $100 special assessment fee, and to perform 200 hours of community service. Three co-defendants remain to be sentenced.
Credit for the investigation of this case is given to the U.S. Secret Service, Guam Police Department and the Micronesia Mall Security. The case was prosecuted by Assistant U.S. Attorney Clyde Lemons.
Bradley and Old Town Residents Plead Guilty to Bath Salt Distribution ConspiracyRead the Press Release
Contact: Joel B. Casey
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Gina
Nelson, 31, of Bradley, Maine and Michael Tardiff, a/k/a “Bub”, 54, of Old Town, Maine pleaded guilty today in U.S. District Court in Bangor to conspiracy to possess with the intent to distribute and to distribute MDPV, a chemical compound commonly referred to as “bath salts” or
“monkey dust”.According to court records, the members of the conspiracy illegally distributed MDPV in
Penobscot County and elsewhere between April and December 2011. The defendants obtained
MDPV from other members of the conspiracy and traded, sold or otherwise distributed it using cellular telephones and other means of communication.
The defendants face up to 20 years in prison, a $1,000,000 fine, or both. They will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The defendants are two of fourteen defendants charged by indictment as part of the conspiracy. An indictment is merely an accusation and a defendant is presumed to be innocent until proven guilty in a court of law.
Co-defendants Elizabeth Mikotowicz, a/k/a “Beth,” Steven Orosco, a/k/a “Pablo,” Alan
Alan Ketchen, a/k/a “AJ,” Daniel Hines, Adam Hathorn, and Tina Keaton, a/k/a “Fumble,” all of
Bangor; Jessica Bryden, of Greenbush, Maine; and Matthew Tardiff, of Old Town, Maine; previously pled guilty to the conspiracy charge and await sentencing.
The case was investigated by the Maine Drug Enforcement Agency with assistance from the U.S. Drug Enforcement Administration and the Bangor Police Department.Benjamin Dwayne Swiger Sentenced to Serve Twenty Years in Prison for Distributing Child PornographyRead the Press Release
GREENEVILLE, Tenn.- Benjamin Dwayne Swiger, 28, of Gray, Tenn., was sentenced to serve 20 years in prison by the Honorable J. Ronnie Greer, U.S. District Judge. Upon his release from prison, Swiger will serve a life term of supervised release with special conditions. Swiger pleaded guilty in January 2014 to a federal indictment charging him with distributing child pornography.
The indictment and subsequent conviction of Swiger was the result of an investigation conducted by the Federal Bureau of Investigation and Washington County Sheriff’s Office. Assistant U.S. Attorney Helen Smith represented the United States.
William C. Killian, U.S. Attorney for the Eastern District of Tennessee said, "This case represents the continuing commitment of the U.S. Attorney's Office to prosecute those who distribute images of children being sexually exploited."
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Attorney General Holder Criticizes Excessive Use of <br /> Solitary Confinement for Juveniles with Mental IllnessRead the Press Release
WASHINGTON—Speaking in a video message posted on the Justice Department’s website, Attorney General Eric Holder on Wednesday called for an end to the excessive use of solitary confinement for youth that suffer from mental illness. Attorney General Holder said the practices can have lasting, substantial effects on young people that could result in self-harm or, in some cases, even suicide.
“Solitary confinement can be dangerous, and a serious impediment to the ability of juveniles to succeed once released,” Attorney General Holder said. “At a minimum, we must work to curb the overreliance on seclusion of youth with disabilities.”
As a result of these unhealthy practices that violate the Violent Crime Control and Law Enforcement Act and the Civil Rights of Institutionalized Persons Act (CRIPA), the Justice Department’s Civil Rights Division sought a federal court order temporarily restraining the Ohio Department of Youth Services (DYS) from unlawfully secluding boys with mental health needs in its juvenile correctional facilities.Last February, the Civil Rights Division also took the rare but necessary step of filing a statement of interest addressing the use of excessive reliance on solitary confinement for disabled youth in Contra Costa County, California. Young people in these detention centers, including those with disabilities, were allegedly held in solitary confinement for up to 23 hours a day, often with no human interaction at all.
The complete text of the Attorney General’s video message is below:
“Across the country, far too many juvenile detention centers see isolation and solitary confinement as an appropriate way to handle challenging youth, in particular youth with disabilities. But solitary confinement can be dangerous, and a serious impediment to the ability of juveniles to succeed once released.
“In a study released last year by the Office of Juvenile Justice and Delinquency Prevention, 47 percent of juvenile detention centers reported locking youth in some type of isolation for more than four hours at a time. We have received reports of young people who have been held in solitary confinement for up to 23 hours a day, often with no human interaction at all. In some cases, children were held in small rooms with windows that were barely the width of their own hands.
“This is, to say the least, excessive. And these episodes are all too common.
“This practice is particularly detrimental to young people with disabilities – who are at increased risk under these circumstances of negative effects including self-harm and even suicide. In fact, one national study found that half of the victims of suicides in juvenile facilities were in isolation at the time they took their own lives, and 62 percent of victims had a history of solitary confinement.
“Let me be clear, there may be times when it becomes necessary to remove a detained juvenile from others in order to protect staff, other inmates, or the juvenile himself from harm. However, this action should be taken only in a limited way where there is a valid reason to do so, and for a limited amount of time; isolated juveniles must be closely monitored, and every attempt must be made to continue educational and mental health programming while the youth is in isolation.
“At a minimum, we must work to curb the overreliance on seclusion of youth with disabilities. And at the Department of Justice, we are committed to working with states to do this going forward.“We must ensure in all circumstances – and particularly when it comes to our young people – that incarceration is used to rehabilitate, and not merely to warehouse and forget. Our nationwide effort to end the unnecessary or excessive seclusion of youth with disabilities will not be completed solely with one settlement or court filing. But as a department, we are dedicated – and as Attorney General, I am committed – to doing everything possible to ensure the effectiveness and integrity of our criminal and juvenile justice system. In the days ahead, we will continue to make good on our commitment to the best practices of law enforcement and the highest ideals of our nation.”
The full video message is available at http://www.justice.gov/agwa.php.
Army Colonel Charged Federally with Possession and Distribution of Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a federal grand jury in Harrisburg today indicted Colonel Robert J. Rice, 56, of Carlisle, for possession and distribution of child pornography over the internet. Rice is a Colonel in the U.S. Army stationed at the U.S. Army War College in Carlisle.
According to U.S. Attorney Peter Smith, the charges stem from an investigation by the Cumberland County District Attorney’s Office with assistance from the U.S. Army Criminal Investigation Division and the U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI).
The Cumberland County District Attorney’s Office, conducted the initial investigation and is cooperating with federal authorities in this case. The case is being prosecuted by Assistant United States Attorney James T. Clancy.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
If convicted of both offenses, Rice faces up to 30 years in prison and fines of $500,000. The possession offense carries a maximum jail sentence of ten years and a maximum fine of $250,000. The distribution offense carries a mandatory minimum five-year jail sentence and a maximum jail sentence of twenty years along with a maximum fine of $250,000.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.