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8 May 2014
Middlesex County, N.J., Dermatologist Charged with Structuring Nearly $850,000 in Deposits to Avoid Reporting RequirementsRead the Press Release
NEWARK, N.J. - A dermatologist with a medical practice in East Brunswick, N.J., was charged today for allegedly structuring nearly $850,000 by intentionally purchasing numerous money orders for amounts below what would trigger a financial institution’s IRS reporting requirements, U.S. Attorney Paul J. Fishman announced.
Sandy S. Milgraum, 60, is charged in a criminal complaint with one count of conspiring to structure financial transactions to evade currency reporting requirements. Milgraum made his initial appearance in Newark federal court this afternoon and was released on $300,000 bail.
According to the complaint filed in this case and statements made in court:
Milgraum is a licensed and board-certified dermatologist who operates the Academic Dermatology Laser Surgery Center in East Brunswick. From January 2005 through August 2010, Milgraum and others acting at his direction purchased approximately 1,280 money orders and monetary instruments totaling at least $846,092.92.
Each money order was purchased below the $3,000 limit that would require a financial institution to file a Cash Transaction Report with the IRS and disclose the identity of the individual who conducted the transaction, as well as the individual or organization for whom the transaction was completed.
Milgraum and others purchased money orders from various venders including MoneyGram, Western Union, Bank of America and the United States Postal Service and then used them to make mortgage payments, credit card payments, business payments and other personal payments, including payments for various credit card debts incurred by a romantic partner of Milgraum’s.
The charge carries a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss caused by the offense.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria Kelokates, with the investigation leading to the charge.The charge and allegations contained in the complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
The government is represented by Assistant U.S. Attorney Michael H. Robertson of the U.S. Attorney’s Office’s Health Care and Government Fraud Unit in Newark.
14-157
Defense counsel: Joseph J. Benedict Esq., New Brunswick, N.J.
Milgraum, Sandy Complaint
Michigan Man Indicted for Three Bank RobberiesRead the Press Release
An indictment was filed chagring Jason Radigan, age 39, of Northville, Michigan, with robbing three banks, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges Radigan with robbery of Charter One Bank, located at 5150 North Summit Street, Toledo, Ohio, on January 30, 2014; Huntington Bank, located at 5201 North Summit Street, Toledo, Ohio, on March 4, 2014; and State Bank & Trust, located at 610 East South Boundary, Perrysburg, Ohio on April 9, 2014.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Federal Bureau of Investigation’s Northwest Ohio Violent Crimes Task Force, the Toledo Police Department, and the City of Perrysburg, Ohio Police Department. The case is being handled by Assistant United States Attorney Ava Dustin.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Mexican Man Charged with Illegal ReentryRead the Press Release
An indictment was filed charging Salvador Soto-Gomez, age 63, of Mexico, with with unlawful reentry into the United States on April 2, 2014, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the United States Department of Homeland Security, Cleveland, Ohio. The case is being handled by Assistant United States Attorney Michael J. Freeman.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Mexican Citizen Pleads Guilty to Unlawful Use of Identification Documents and Aggravated Identity TheftRead the Press Release
A Mexican citizen who was twice convicted using the identity of a dead American citizen who attempted to obtain new identification documents and gain employment in that name plead guilty May 7, 2014, in federal court in Cedar Rapids.
Abel Fajardo-Guizar, age 38, a citizen of Mexico, living in Cedar Rapids, Iowa, was convicted of two counts of unlawful use of identification documents and two counts of aggravated identity theft.
In a plea agreement, Fajardo-Guizar admitted he was twice convicted under the name of another real person who died in 1995. On November 22, 2013, falsely claiming to be a U.S. citizen, Fajardo-Guizar used the date of birth, the Social Security Card and Social Security Number of another real person, someone he personally knew, to obtain a State of Iowa Identification Card in that person’s name. On December 18, 2013, again falsely claiming to be a U.S. citizen, Fajardo-Guizar used the date of birth, the Social Security Card and Social Security Number of another real person, and the recently acquired State of Iowa Identification Card when completing forms required to work in this country. On March 1, 2014, Fajardo-Guizar attempted to obtain a State of Iowa driver’s license using that the name, date of birth and Social Security Number of that other real person. When arrested on Federal charges on March 19, 2014, defendant had in his possession that other person’s birth certificate.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Fajardo-Guizar remains in custody of the United States Marshal pending sentencing. On each unlawful use of identification documents conviction, Fajardo-Guizar faces a possible maximum sentence of ten years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment. On each aggravated identity theft conviction, Fajardo-Guizar faces a mandatory sentence of two years’ imprisonment, a $250,000 fine, $100 in special assessments, and one year of supervised release following any imprisonment. Any sentence on the aggravated identity theft convictions must be served consecutive to any other sentence.
The case is being prosecuted by Assistant United States Attorney Daniel C. Tvedt and was investigated by agents from the Department of Homeland Security, Immigration and Customs Enforcement.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 14-CR-38.
Massage Parlor Owner Pleads GuiltyTo Harboring, Obstruction of JusticeRead the Press Release
WICHITA, KAN. - The former owner of a Wichita massage parlor pleaded guilty Thursday to harboring an undocumented Chinese woman and threatening to harm a law enforcement officer, U.S. Attorney Barry Grissom said.
Gary H. Kidgell, 45, Waltham, Mass., pleaded guilty to one count of harboring an alien who was illegally in the United States and one count of attempted obstruction of justice. In his plea, Kidgell admitted that in January 2011 he interviewed a Chinese woman to work at a massage parlor he owned in Wichita. Kidgell spoke to the woman through an interpreter because she did not speak English. He made the Chinese woman stay at his residence and pay rent.
In January and February 2014 while Kidgell was in custody in the case he told other inmates at the Butler County Jail that he intended to harm a law enforcement officer who investigated the case unless his case was resolved the way he wanted.
Kidgell is set for sentencing Aug. 1. Both parties have agreed to recommend a sentence within in the range of 51 months and 63 months in federal prison.
Co-defendants include: Yan Zhang, 50, Wichita, Kan., who is awaiting trial.
Xinqing Tian, 44, who was sentenced to time served and two years supervised release.Grissom commended the Wichita Police Department and Assistant U.S. Attorney Jason Hart for their work on the case.
Manhattan Business Owner Sentenced in Manhattan Federal Court to 46 Months in Prison for His Participation in A $2.9 Million Ponzi SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JASON KONIOR, the founder and manager of a number of related business entities in New York City, collectively referred to as “Absolute,” was sentenced yesterday in Manhattan federal court to 46 months in prison for his participation in a Ponzi scheme. KONIOR previously pled guilty on July 9, 2013, to one count of wire fraud for his role in stealing at least $2.9 million from small hedge fund investors and using the funds to pay off prior investors and to pay himself. He was sentenced yesterday by U.S. District Judge Alvin K. Hellerstein.
According to the Information, statements made during KONIOR’s sentencing proceeding yesterday and his guilty plea on July 9, 2013, and a Complaint previously unsealed in Manhattan federal court:
From late 2011 through May 2012, KONIOR organized and managed a Ponzi scheme in which he misappropriated at least $2.9 million in funds he had solicited from hedge fund investors. He represented to these hedge funds that Absolute would provide additional trading funds of up to nine times the investment they made in Absolute. As part of Absolute’s “first loss” investment program, KONIOR claimed that he would place the combined funds – the investors’ funds and the additional funds to be provided by Absolute – in a brokerage account designated by Absolute. According to KONIOR, the hedge fund investors would then be able to trade securities utilizing that brokerage account. Under the arrangement, the hedge funds would be responsible for trading losses, and they would share any profits with Absolute.
Instead of establishing brokerage accounts for the victim hedge funds, KONIOR misappropriated the funds they provided by paying redemptions to prior investors, making payments to himself, and paying various personal and business expenses. In e-mails, text messages, and telephone conversations, KONIOR pretended that he was establishing brokerage accounts for the three hedge fund investors, when he had already stolen their money. In one case, after he repeatedly failed to set up a brokerage account for one of the hedge funds, the manager of the fund sent him a text message stating, “I want my money back. What did you do to it anyway? Are you going to tell me or do you want the SEC to find out?” KONIOR responded with a text message that said, “[w]e have your funds in our acct. Where else would they be?” At the time he wrote the message, he had already used that hedge fund’s investment to pay off other investors and his own expenses.
In addition to the prison term, Judge Hellerstein sentenced KONIOR, 40, of New York, New York, to three years of supervised release. KONIOR was also ordered to forfeit $2.9 million and to pay a $2.9 million fine.
Mr. Bharara praised the work of the Federal Bureau of Investigation and the Securities and Exchange Commission.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys John T. Zach and Jason H. Cowley are in charge of the prosecution.
Man Pleads Guilty to Armed CarjackingRead the Press Release
MINNEAPOLIS—Yesterday in federal court, a 22-year-old Minneapolis man, Larry Jarrell Campbell pleaded guilty to one count of Carjacking and one count of Brandishing a Firearm During and in Relation to a Crime of Violence. Campbell, who was indicted on March 10, 2014, entered his plea before United States District Court Judge Joan N. Ericksen.
In his plea agreement, Campbell admitted that on January 12, 2014, he approached a vehicle occupied by two victims and parked in the parking lot of a convenience store in North Minneapolis. He tapped on the rear window of the vehicle using a .22 caliber pistol and got into the back seat of the vehicle. He then pointed the gun at the two victims and threated to kill them. He demanded that the victims drive him to two separate ATMs to have the victims withdraw money from their bank accounts for him. He then commanded the victims to exit the vehicle and to lie face-down in a snowbank at gunpoint, so he could steal their vehicle. He then took the vehicle, drove to a nearby Walmart store, and attempted to use one of the victim’s credit cards to purchase merchandise.
Carjacking carries a potential maximum penalty of 15 years imprisonment. Brandishing a Firearm During and in Relation to a Crime of Violence carries a statutory minimum penalty of seven years, and a potential maximum penalty of life imprisonment. Judge Ericksen will determine the defendant’s sentence at a future hearing, not yet scheduled.
This case is the result of an investigation by the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Minneapolis Department. It is being prosecuted by Assistant U.S. Attorney Surya Saxena.Lowell Man Charged Federally for Producing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN – A federal grand jury returned a nine-count indictment Thursday charging a West Michigan man with producing and possessing child pornography. The indictment alleges that Travis Stiehl, 22, produced sexually explicit photographs and videos of children as young as two years old on eight different occasions from September 2011 to August 2013. The indictment also charges Stiehl with possession of approximately 2,000 images of child pornography on a hard drive.
Stiehl was arrested April 25, 2014, at his mother’s residence in Lowell, which had previously operated as a daycare facility. He has been in custody since that time. The eight production counts each carry a mandatory minimum sentence of 15 years in prison and a maximum of 30 years. The possession count carries a maximum sentence of 20 years.The charges are the result of an investigation conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Michigan State Police Internet Crimes Against Children. Assistant U.S. Attorney Tessa K. Hessmiller is the prosecutor on the case.
HSI requests that anyone who believes his or her child may have been a victim contact HSI at 616-235-3936, extension 2215.
The charges in an indictment are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law.
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Keith Miller of Lyndonville, Vermont Sentenced to 21 Months for Possession of Child PornographyRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Keith Miller, 44, of Lyndonville, Vermont was sentenced on May 5, 2014 for possession of child pornography. Judge William K. Sessions III sentenced Miller to 21 months in prison, to be followed by five years of supervised release. Miller’s supervised release conditions will include special sex offender conditions, including a requirement that he register as a sex offender upon his release from prison. Judge Sessions ordered Miller to surrender to serve his sentence on June 10, 2014.
According to court documents, as part of an on-line investigation into users’ acquisition of child pornography by computer, federal agents determined that a computer at Miller’s residence had downloaded child pornography. Agents executed a federal search warrant at Miller’s residence on February 19, 2013. Miller admitted that he had used his computer to download child pornography. Subsequent forensic analysis of the computers seized from Miller determined that Miller had downloaded a substantial number of images of child pornography.
This matter was investigated by Homeland Security Investigations and the Vermont State Police, with the assistance of the Lyndonville Police Department. The case was prosecuted by Assistant U.S. Attorney Kevin J. Doyle. Miller is represented by David L. McColgin of the Federal Defender’s Office.
Jury Convicts Two Inmates of Murdering Prisoner, Trial Enters Death Penalty PhaseRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two inmates of the U.S. Medical Center for Federal Prisoners in Springfield, Mo., have been convicted in federal court of murdering another inmate at the facility.
Wesley Paul Coonce, Jr., 34, and Charles Michael Hall, 43, who are both inmates at the U.S. Medical Center for Federal Prisoners, were found guilty on Wednesday, May 7, 2014, of one count of murder in the first degree. Coonce was also found guilty of one count of murder by an inmate serving a life sentence.
The evidence presented at trial demonstrated that another inmate at the prison medical center, Victor Castro-Rodriguez, 51, was found deceased on the floor of his cell on Jan. 26, 2010.
Following the presentation of evidence, the jury in the U.S. District Court in Springfield, Mo., deliberated for about an hour before returning the guilty verdicts to U.S. District Judge Gary A. Fenner, ending a trial that began April 28, 2014.
The trial now enters the penalty phase in which the jury must determine the sentences for Coonce and Hall. Under federal statutes, Coonce and Hall are subject to either the death penalty or life in federal prison without parole.
This case is being prosecuted by Trial Attorney James D. Peterson of the Capital Case Section of the U.S. Department of Justice’s Criminal Division and Assistant U.S. Attorney Randall D. Eggert. It was investigated by the FBI and the Bureau of Prisons.Information: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office today announced that those persons listed below were arraigned before the U.S. Magistrate and the indictments handed down by the Grand Jury unsealed.
Appearing before U.S. Magistrate Judge Ostby in Billings on May 7, 2014 and entering pleas of Not Guilty were:
- JORDAN CAMPBELL-ZORN, a 22-year-old resident of Glendive, appeared on charges of receipt of child pornography. If convicted of the charge contained in the indictment, CAMPBELL-ZORN faces 5 years imprisonment, $250,000 in fines and lifetime supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 14-41
Appearing before U.S. District Judge Brian Morris in Great Falls on May 8, 2014 and entering pleas of Not Guilty were:
- ADAM BLUE COLGAN, a 33-year-old resident of Poplar, appeared on charges of possession of an unregistered destructive device and transportation of explosive material by a non-licensee. If convicted of the charges contained in the indictment, COLGAN faces 10 years imprisonment, $250,000 in fines and 3 years supervised release. The case was investigated by the Federal Bureau of Investigation. PACER Case Reference: 13-114
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system so that you stay current and not miss any important developments in the case.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court's calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
Indictment Charges Three People in Nine Day, Four County Armed Robbery SpreeRead the Press Release
PHILADELPHIA – An indictment filed today charges Dale Mentzer, 36, of Waymart, PA, and Heath DeRizzo, 37, of Manheim, PA, in a half-dozen armed robberies, in Berks, Chester, Lebanon, and Northampton Counties, between July 11, 2013 and July 19, 2013, announced United States Attorney Zane David Memeger. The pair was charged with two counts of interference with interstate commerce by robbery, four counts of bank robbery, two counts of use and carrying of a firearm during a crime of violence, and two counts of convicted felon in possession of a firearm. A third defendant, Samantha Henderson, 23, of Fredericksburg, PA, was charged with accessory to robbery after the fact.
According to the indictment, Mentzer and DeRizzo committed armed robberies at a Sovereign Bank branch in Kutztown, on July 11, 2013; a Northwest Savings Bank branch in Myerstown, on July 16, 2013; a First Cornerstone Bank branch in Phoenixville and The Rodeway Inn motel in Muhlenberg, on July 18, 2013; a National Penn Bank branch, on July 19, 2013; and, that same day, Cihylik Farms in Allen Township. Henderson is charged with assisting Mentzer and DeRizzo hinder and prevent their apprehension, trial, and punishment.
If convicted, defendants Mentzer and DeRizzo each face a minimum mandatory term of 32 years in prison up to life, a fine of up to $2.5 million, five years of supervised release and a $1,000 special assessment. Henderson faces a maximum possible sentence of 10 years in prison, three years of supervised release, a fine of up to $250,000, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation-Allentown Resident Agency, Pennsylvania State Police, East Pikeland Township Police Department, Northampton Police Department, Kutztown Police Department, Muhlenberg Township Police Department, Worcester County Bureau of Investigation, and FBI Baltimore-Salisbury Resident Agency. It is being prosecuted by Assistant United States Attorney John Gallagher.
Click here to view the indictment
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Importers of Fake Brand Name Goods That Were Illegally Counterfeited in China Are Sentenced to Federal PrisonRead the Press Release
LOS ANGELES – A San Gabriel Valley businessman who coordinated the importation of 11 containers of counterfeit apparel – including Nike, Gucci and Coach products worth more than $2.3 million – was sentenced today to 31 months in federal prison.
Today’s sentencing is the second in the past two weeks in which a smuggling operation resulted in a federal prison term. Last week, a Glendale man who brought bogus AMG wheels into the country received a one-year prison sentence.
Both defendants previously pleaded guilty to trafficking in counterfeit goods.
In today’s sentencing, Kevin “Peter” Wang, 54, of Rosemead, was sentenced to 31 months by United States District Judge John A. Kronstadt. In addition to the prison term, Judge Kronstadt ordered Wang to serve an additional six months of home detention and to pay a $10,000 fine and $50,000 in restitution.
Wang helped Chinese exporters bring counterfeit goods – including fake Nike shoes (labeled as “garment hangers”); counterfeit Coach, Gucci, and Louis Vuitton handbags (labeled as “toilet paper”); and bogus NFL, NBA, and NHL jerseys – into the United States. According to court documents, from 2008 to 2012, the counterfeit goods were smuggled in shipping containers through the ports of Los Angeles and Long Beach.
In the second case that led to a prison term, Hamlet Ayvazyan, 37, of Glendale, was sentenced on Monday, April 28, to one year and one day in federal prison. Ayvazyan was sentenced by United States District Judge Margaret M. Morrow, who also ordered the defendant to pay a $4,000 fine.
Ayvazyan, the owner of Speedvision Motorsport in Glendale, imported wheel rims from a Chinese business known as "Shandong Chiping Xinfa Aluminous Product Co., Ltd.," which had offered wheels for brands that purported to be “Audi,” “BMW,” “Mercedes Benz,” “Land Rover,” “Porsche” and “Cadillac."
U.S. Customs and Border Protection officials discovered Ayvazyan's imports in January 2012 when they inspected an ocean container that contained 430 wheels that bore counterfeit Mercedes Benz “AMG” logos, with Ayvazyan and Speedvision as consignee. Undercover agents with Homeland Security Investigations posed as customers and met with Ayvazyan at Speedvision, where Ayvazyan sold to the agents a wheel with an “AMG” logo and placed a center cap “Mercedes” decal on the wheel.
In February 2012, agents executed a search warrant at Speedvision and found 189 additional wheels bearing counterfeit “AMG” marks. Although Ayvazyan claimed that the goods were “replicas,” the marks on the wheels were unauthorized copies of the registered “AMG” trademark. Ayvazyan also kept 2,100 adhesive logos and wheel center caps that bore marks such as “Mercedes Benz” and “BMW.”
Ayvazyan paid approximately $100 for each wheel and sold them for $200, which was substantially less than the manufacturer’s price for legitimate wheels, which was as much as $2,000.
The cases against Wang and Ayvazyan were investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).
“Trafficking in counterfeit merchandise is a multi-billion dollar global business that robs governments of vital revenues and the industry of its due profits,” said Claude Arnold, special agent in charge of HSI Los Angeles. “HSI is committed to dismantling these schemes because the profits from such illegal ventures often go to fund more criminal enterprises.”
Release No. 14-058
Illegal Alien Sentenced for Unlawful Possession of Identification DocumentsRead the Press Release
An illegal alien who possessed identification documents issued in the name of another real person was sentenced today to two years in federal prison.
Carlos Lopez-Pinto, age 36, a citizen of Mexico, living in Cedar Rapids, Iowa, received the prison term after a February 21, 2014, guilty plea to one count of unlawful possession of identification documents.
In a plea agreement, Lopez-Pinto admitted that on March 2, 2012, claiming to be a U.S. citizen, he possessed and used a Social Security card and its Social Security Number and a State of Minnesota Identification Card to apply for work in Iowa under the name of another real person. Lopez-Pinto knew the Social Security Number had been issued to another real person as he had a copy of that person’s birth certificate. The fraudulent Minnesota Identification Card with Lopez-Pinto’s picture had a fictitious identification number.
Lopez-Pinto was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Lopez-Pinto was sentenced to 24 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Carlos-Pinto is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by agents from the Department of Homeland Security, Immigration and Customs Enforcement.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-CR-97.
Idaho Man Pleads Guilty to Destruction of National Forest LandRead the Press Release
Admits Willful Injury to Property of the United States
COEUR D’ALENE – Stanley D. Votava, 60, of Coeur d’Alene, Idaho, pleaded guilty today before United States Magistrate Judge Candy W. Dale to damaging lands within the Idaho Panhandle National Forest. This is a violation of 18 U.S.C. 1361 and carries a maximum punishment of up to one year incarceration, and $100,000 fine, U.S. Attorney Wendy J. Olson announced. Sentencing is scheduled for August 19, 2014.
According to the plea agreement, Votava had been hired to remove some trees on private land adjacent to the U.S. Forest. While doing this work, he drove his skidder four times through the Idaho Panhandle National Forest causing damage to the forest estimated at over $7,000.00.
The case was investigated by the U.S. Forest Service.
Husband and Wife Sentenced for Selling Methamphetamine in ChapmanvilleRead the Press Release
CHARLESTON, W.Va. – Rodney Wiley, 30, and his wife Opal Wiley, 42, of Chapmanville, Logan County, West Virginia, were sentenced today to 30 months and 18 months imprisonment, respectively, for selling methamphetamine, United States Attorney Booth Goodwin announced. Both defendants, who pleaded guilty in February of this year, previously admitted to selling methamphetamine to what proved to be a confidential informant working with the U.S. 119 Drug Task Force. The meth sale occurred in January 2013, outside the Dollar General Store in Chapmanville. At the time of their arrest, the defendants further acknowledged that they had jointly sold methamphetamine for several months.
United States District Judge John T. Copenhaver, Jr., handed down today’s sentence.
Holyoke Man Sentenced for Embezzlement from Veteran's Administration OrganizationRead the Press Release
BOSTON – A Holyoke man was sentenced today for embezzling $60,000 from the Boston Veteran’s Administration Research Institute (BVARI).
Riccardo D'Orsainville, 48, was sentenced by U.S. District Court Judge Rya W. Zobel to 21 months in prison, three years of supervised release, and $59,979 in restitution. In February 2014, D'Orsainville pleaded guilty to embezzlement and misuse of a passport.
In August 2011, D'Orsainville was hired by the BVARI as a temporary employee. BVARI is non-profit, tax-exempt institute whose purpose is to conduct the medical research and educational activities of the U.S. Veteran’s Affairs healthcare system. D'Orsainville's responsibilities included helping BVARI’s CEO with administrative duties, such as preparing for meetings, writing the minutes for each meeting, collecting the mail, and depositing certain checks payable to BVARI into BVARI's business bank accounts.
In July 2012, D'Orsainville forged the signatures of two BVARI employees to open an unauthorized corporate Citizens bank account in the name of BVARI. Between July 2012 and January 2013, D'Orsainville embezzled approximately $68,336 in checks made out to BVARI by depositing them into the Citizens bank account from which he ultimately withdrew approximately $60,000 for his personal use.
When D'Orsainville was arrested on July 17, 2013, he was in possession of a European Union passport belonging to a British national. D’Orsainville had altered the passport by replacing the passport photograph of the British national with his own. The investigation determined that on June 29, 2013, D'Orsainville used the altered passport to obtain employment at D. Hotel in Holyoke fraudulently employing the name of the British national.United States Attorney Carmen M. Ortiz; Jeffrey Hughes, Special Agent in Charge of the U.S. Department of Veterans Affairs, Office of Inspector General, Northeast Field Office; and Bruce M. Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Shelby Wright.
Hartford Man Pleads Guilty to Illegally Possessing Two Semi-automatic RiflesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that EDWIN CARTER, 51, of Hartford, pleaded guilty yesterday before Chief U.S. District Judge Janet C. Hall in New Haven to possession of firearms by a previously convicted felon.
According to court documents and statements made in court, on November 6, 2013, members of the Hartford Police Department’s Special Operations Group and Shooting Task Force executed a court authorized search of CARTER’s Plainfield Street residence and recovered an FNH PS90 5.7x28 caliber assault rifle with a high capacity magazine containing 15 live rounds, and one Sarko SAR-I (AK-47) 7.62x39 caliber assault rifle with two high capacity magazines, one containing 27 live rounds and the other containing 26 live rounds.
The FNH PS90 assault rifle had been reported stolen out of East Hartford.
Prior to November 2013, CARTER had sustained three felony convictions in the Connecticut Superior Court, including convictions for assault, weapons in a motor vehicle and possession of narcotics. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
CARTER has been detained since his arrest on November 26, 2013.
Judge Hall scheduled sentencing for August 18, 2014, at which time CARTER faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
This matter is being investigated by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force, which includes members of the Hartford Police Department, East Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. The case is being prosecuted by Assistant U.S. Attorney John H. Durham.
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(203) 821-3722 [email protected]Great Falls Man Sentenced to 8 Years in Federal Prison for MethRead the Press Release
The United States Attorney's Office announced that TODD ALLEN SCHMIDT, 50, of Great Falls, was sentenced to 96 months in prison, to be followed by four years of supervised release, during a federal court session in Helena on May 7, 2014, before Senior U.S. District Judge Sam Haddon. Schmidt was sentenced in connection with his January 2014 guilty plea to possession with intent to distribute methamphetamine.
In an Offer of Proof filed by Assistant U.S. Attorney Bryan Whittaker, the prosecution told the Court that on January 14, 2013, in Helena, an informant contacted a local methamphetamine dealer to arrange to purchase 2 ounces of methamphetamine. The first drug dealer was out of town, but told the informant that he could obtain methamphetamine from Todd Schmidt, and that he, the first drug dealer, would have Schmidt call him, the informant.
A short time later, the informant received a call from Schmidt who told the informant that he would meet Schmidt the next evening in Helena with the methamphetamine. The following evening, January 15, 2013, the informant placed several calls to Schmidt which were recorded by law enforcement. The two agreed to meet at the Grub Steak Restaurant parking lot in Helena. Law enforcement provided the informant with sufficient funds to complete the transaction and then monitored the meeting with Schmidt.
Schmidt arrived at the Grub Steak parking lot in a white Cadillac. Schmidt got out of his vehicle and into the informant's vehicle where he gave the informant approximately 2 ounces of methamphetamine in exchange for the cash. Schmidt did not count the money and immediately left the vehicle. Schmidt got back into his car and drove out of the parking lot. The informant then turned the drugs over to law enforcement which were later analyzed and found to contain methamphetamine.
The case was investigated by the Federal Bureau of Investigation, Montana Division of Criminal Investigations, and the Missouri River Drug Task Force.
Former Postmaster Sentenced for Stealing Postal Service FundsRead the Press Release
BUFFALO, N.Y.—U.S. Attorney William J. Hochul, Jr. announced today that Michael Kozina, 57, of Eden, N.Y., who was convicted of misappropriation of postal funds by a postal service employee, was sentenced to six months in prison by U.S. District Judge U.S. District Judge Richard J. Arcara. The defendant was also ordered to pay $27,345.75 in restitution to the U.S. Postal Service.
“We have stated on numerous occasions that those who work in Government owe the public the highest duties of honesty and integrity,” said U.S. Attorney Hochul. “This Office will not tolerate those who would steal from the taxpayers they serve.”
Assistant U.S. Attorney Russell T. Ippolito, Jr., who handled the case, stated that Kozina was employed as Postmaster at the Lawtons, N.Y. Post Office between April 2, 2005 and July 31, 2012. As the Postmaster, the defendant accepted cash payments from more than 12 United States Postal Service customers for the purchase of money orders. Instead of depositing the cash payments into the USPS register, Kozina kept a portion of the cash for his own purposes. The defendant then falsified USPS records to make it appear that customers purchased money orders in an amount which was significantly less than what was actually paid.
As a result, losses to the USPS totaled $13,760.75. In addition, Kozina also stole $13,585 in post office box rental payments between January 1, 2009 and July 31, 2012.
The conviction was the culmination of an investigation on the part of Special Agents of the United States Postal Service, Office of Inspector General, under the direction of Special Agent-In-Charge Monica Weyler.Former Postal Worker Sentenced for Stealing Video Games from the MailRead the Press Release
BOSTON – A former postal worker was sentenced today for stealing more than 200 video games from the mail.
James L. White, 68, of Dorchester, was sentenced by U.S. District Judge Douglas P. Woodlock to 30 days in prison, three years of supervised release, and $8,000 in restitution to Gamefly. In January, White pleaded guilty to theft of mail.
From July through November 2012, White, while working as a mail handler at the Boston General Mail Facility, stole GameFly video games from the mail. He then resold those video games to Gamestop, a videogame and software retailer, garnering himself several thousands of dollars in profit.
United States Attorney Carmen M. Ortiz and Rafael Medina, Special Agent in Charge of the United States Postal Service, Office of Inspector General, Northeast Area Field Office, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Eugenia M. Carris of Ortiz’s Public Corruption and Special Prosecutions Unit.
Former Owner of Sacramento Capitals Tennis Team Pleads Guilty to $50 Million Fraud SchemeRead the Press Release
SACRAMENTO, Calif. — Deepal Wannakuwatte, 63, of Sacramento, pleaded guilty today to one count of wire fraud in furtherance of a long-running and large-scale fraud scheme, announced United States Attorney Benjamin B. Wagner, Special Agent in Charge Monica M. Miller of the FBI’s Sacramento Field Office, Jose M. Martinez Special Agent in Charge for the IRS-Criminal Investigation (IRS-CI) and Wade V. Walters Special Agent in Charge of the Federal Deposit Insurance Corporation (FDIC) Office of Inspector General (OIG).
Under the terms of his plea agreement, the government will recommend that United States District Judge Troy L. Nunley sentence Wannakuwatte to 20 years in prison, the maximum punishment allowable for the offense to which he pleaded guilty. In addition, the agreement requires Wannakuwatte to forfeit multiple properties, vehicles, business interests, and bank accounts to be used to provide restitution to victims.
According to the plea agreement, from 2002 to 2014, Wannakuwatte convinced more than 100 victims, including individuals, corporate entities, and financial institutions, to invest in a number of business opportunities by misrepresenting the financial worth of himself and his companies. Wannakuwatte’s companies, IMG and Relyaid, were involved in the international manufacture, shipment, and distribution of latex gloves. He falsely claimed that these companies did tens of millions of dollars in business with federal agencies every year, most notably the Department of Veterans Affairs. In 2013, Wannakuwatte claimed to have more than $125 million in VA contracts alone. In fact, while he did have a contract with the VA, it was worth up to only $25,000 a year.
In all, Wannakuwatte ultimately obtained well over $150 million from his victims. Contrary to his representations, Wannakuwatte used much of the money he obtained to pay himself and his family, make lulling payments to participants in his fraudulent investment schemes, and pay outstanding debts unrelated to his false representations.
“Mr. Wannakuwatte’s guilty plea brings to an end to one of the longest running, most extensive, and most damaging fraud schemes our region ever has seen,” said U.S. Attorney Wagner. “We are still calculating the total damage resulting from his scheme, but he caused well over $50 million in losses, and the total losses could be closer to $100 million. Together with the FBI and the IRS, our office moved swiftly to ensure not only that he would be held accountable for this crime, but also that we could take all steps possible to return remaining funds to his victims. The very substantial sentence that he is likely to receive should send a clear message that my office will continue to prosecute financial crimes like this one vigorously.”
“Wannakuwatte’s financial empire collapsed because it was based on fraud and deceit. Unfortunately, he left a trail of victims — individuals, businesses, government agencies, venture funds, and other lenders — who suffered significant losses,” said Special Agent in Charge Monica M. Miller of the Sacramento FBI. “The FBI is committed to working with our agency partners to aggressively pursue those who betray the trust of the public for personal gain.”
“This was not your average Ponzi scheme,” said José M. Martínez, Special Agent in Charge, IRS-Criminal Investigation. “The fraud involved hundreds of millions of dollars and more than 100 victims including individuals, corporate entities and financial institutions. The defendant conned investors through the use of false documents, inflated tax returns, and convincing lies. IRS-CI will continue to work closely with our law enforcement partners to aggressively pursue fraud schemes such as these.”
“The Federal Deposit Insurance Corporation (FDIC) Office of Inspector General (OIG) is pleased to have joined the Department of Justice and our law enforcement colleagues in conducting this investigation,” stated FDIC OIG Special Agent in Charge Wade V. Walters. “We are especially concerned when individuals like Mr. Wannakuwatte defraud our nation’s financial institutions. We are firmly committed to joint efforts such as this one in the interest of ensuring integrity in individual institutions and the financial system as a whole.”
Wannakuwatte used a variety of false and fraudulent means to back up his claims of financial success. For example, Wannakuwatte regularly provided investors with inflated financial statements that supported his claims that he had more than $100 million in sales with the VA. He also regularly provided victims with false corporate ledgers from IMG and Relyaid. Some ledgers falsely showed tens of millions of dollars in accounts receivable from the VA. Other ledgers falsely showed tens of millions of dollars in glove inventory.
Wannakuwatte also provided his victims with personal and corporate tax returns. Wannakuwatte actually reported and paid taxes on returns that falsely overstated his annual personal income and the annual gross receipts and sales for IMG. He used these returns to establish his financial credibility with financial institutions and individual investors.
On at least two occasions, Wannakuwatte set up fake conference calls between himself, a victim, and a person whom he directed to act as a VA representative. The conference calls were to convince victims of the value of the VA contracts and the relationship Wannakuwatte claimed to have with the VA.
Wannakuwatte’s plea agreement contains multiple provisions designed to return as much investor money as possible. He must disclose the existence of any assets or property that he obtained as the result of his scheme, and forfeit his interest in 16 properties, four vehicles, multiple bank accounts, insurance policies, business interests, and any tax refunds to which he may be entitled. Wannakuwatte’s properties are in Hawaii, Oregon, and in the counties of Sacramento, Yolo, and Yuba. They include his residence, vacation homes, and commercial properties. In addition, Wannakuwatte agreed to file for personal bankruptcy, and to file bankruptcy petitions on behalf of any business in which he may have an interest. These filings must be done by the end of May 2014 and should give creditor victims a forum to pursue claims against him.
This case is the product of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the Federal Deposit Insurance Corporation, Office of Inspector General, Office of Investigations. Assistant United States Attorneys Michael Beckwith and Kevin Khasigian are prosecuting the case.
Wannakuwatte is scheduled to be sentenced by Judge Nunley on July 24, 2014. The plea agreement is subject to the approval of Judge Nunley. If the agreement is accepted, Wannakuwatte’s actual sentence will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Former Executive Director of Virgin Islands Legislature Charged with Bribery and Extortion <br /> in Award of Government ContractsRead the Press Release
The former e xecutive director of the Legislature of the Virgin Islands was indicted today by a federal grand jury in the Virgin Islands for accepting bribes and engaging in extortion in the award of contracts with the Legislature, announced Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division and U.S. Attorney Ronald W. Sharpe for the District of the Virgin Islands.
The indictment charges Louis “Lolo” Willis, 56, of St. Thomas, Virgin Islands, with three counts of federal programs bribery and three counts of extortion under color of official right.
According to the indictment, Willis was the executive director of the Legislature between 2009 and 2012. One of his responsibilities included oversight of the renovation of the Legislature building, which included awarding and entering into contracts on behalf of the Legislature. These contracts included contracts for general construction, air-conditioning services and carpentry, which were not publicly bid. Willis was also responsible for paying the contractors for their work. As alleged in the indictment, Willis accepted payments, including, among other things, thousands of dollars in cash, from three contractors in exchange for using his official position to secure contracting work for the contractors and to ensure they received payment upon completion.
An indictment is merely an accusation, and a defendant is presumed innocent unless proven guilty in a court of law.
This case was investigated by the FBI’s San Juan Division, the Office of the Virgin Islands Inspector General and the Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Trial Attorneys Peter Mason and Jennifer Blackwell of the Criminal Division’s Public Integrity Section and First Assistant U.S. Attorney Thomas Anderson of the District of the Virgin Islands.Former Camp Pendleton Marine Gunnery Sergeant Guilty of Nearly $100,000 FraudRead the Press Release
United States Attorney Laura E. Duffy announced today that a former U. S. Marine Gunnery Sergeant admitted to submitting false lodging reimbursement requests to the Marine Corps from 2009 to 2011, totaling nearly $100,000. At the time, the defendant, Gunnery Sergeant Devin Pierre Alario was stationed at Marine Corps Base Camp Pendleton.
As detailed in his plea agreement, under certain circumstances, reservists who are called to active duty become eligible for a housing reimbursement benefit during the term of their active duty, in addition to the basic allowance for housing that they receive. Alario exploited this housing reimbursement benefit by falsely claiming reimbursement for rent that he never paid. Specifically, on 27 occasions from June 2009 through October 2011, Alario submitted false rental receipts that inflated the amount he was paying for rent, included a fictitious landlord, or contained a false address. To substantiate his lodging claims and conceal the fraud, Alario also submitted fake leases that he prepared. Typically, Alario’s false claims sought rental reimbursement for up to $3,800 per month. All told, he made $95,013.10 from his fraud.
Alario pleaded guilty to one felony count of making false claims against the United States.
In his plea agreement, Alario agreed to pay restitution to the U.S. Marine Corps in the full amount of the losses.
United States Attorney Duffy stated, “We will aggressively prosecute anyone who siphons much-needed taxpayer funds from our nation’s armed forces, including those who exploit their positions within the military to do so.”
Acting Special Agent in Charge Kevin F. Boyne of the Defense Criminal Investigative Service (DCIS) Western Field Office commented, “DCIS is committed to working with the Naval Criminal Investigative Service and other partner agencies to aggressively pursue those individuals who undermine the public trust and the efforts of the Department of Defense to support the warfighter and their families. Schemes motivated by greed betray the values of the Marine Corps and cannot be tolerated.”
The case has been assigned to U. S. District Judge Cathy Ann Bencivengo. The next scheduled court appearance is July 25, 2014 at 9:00 a.m. for sentencing.
DEFENDANT Case Number: Devin Pierre Alario Age: 40 Temecula, CA CHARGESFalse claims, in violation of Title 18, United States Code, Section 287 - Maximum penalties: 5 years in prison, $250,000 fine, term of supervised release of three years, restitution, and $100 special assessment.
INVESTIGATING AGENCYDefense Criminal Investigative Service
Naval Criminal Investigative Service*Indictments and complaints are not evidence that the defendant committed the crime charged. All defendants are presumed innocent until the United States meets its burden in court of proving guilt beyond a reasonable doubt.
Florence Attorney Pleads to Mail FraudRead the Press Release
Contact Person: Bill Day (803) 929-3000
Columbia, South Carolina ----- United States Attorney Bill Nettles stated today that William J. Rivers,III, age 48, of Darlington, South Carolina, was sentenced in federal court in Florence by Chief United States District Judge Terry L. Wooten to 60 months and ordered to pay $2,702,060.00 in restitution, for violations of mail fraud, a violation of Title 18, United States Code, Section 1341.
Evidence presented at the change of plea hearing established that clients of Schurlknight & Rivers, P.A., a personal injury law firm in Florence, South Carolina, complained to the South Carolina Bar Association that they had been defrauded by William J. Rivers, III, and his partner, John L. Schurlknight. During the resulting investigation by the Disciplinary Counsel of the South Carolina Supreme Court, an investigator scheduled an appointment with John L. Schurlknight. However, on the day of the meeting with Schurlknight, he committed suicide. Investigation revealed that between October 2006 and November 2012, more than one hundred clients of the firm were defrauded of more than $3,300,000.00. Twenty six of the victims were directly attributable to actions by Rivers. Rivers defrauded his clients by forging their names on releases to settle personal injury cases and lying to his clients telling them the cases had not been settled. The money was then kept by the law firm. In addition to keeping the settlement monies of his clients, Rivers also failed to pay medical providers with the settlement proceeds, leaving the clients owing hundreds of thousands of dollars for the medical treatment they had received.
The case was investigated by the agents of the Federal Bureau of Investigation. Assistant United States Attorney William E. Day, II, of the Columbia office handled the case.Federal Indictment Charges Six Men with Trafficking Narcotics in Lea CountyRead the Press Release
ALBUQUERQUE – A federal grand jury has returned an indictment charging six men with narcotics trafficking offenses, announced Acting U.S. Attorney Damon P. Martinez, Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division and Commander Byron Wester of the Lea County Drug Task Force (LCDTF).
The seven-count indictment, which was filed yesterday, charges Leroy Castillo, 32, Sergio Garza, 35, and Joe Padilla, 32, of Hobbs, N.M., Ruben Estrada, 32, and Richard Armijo-Romero, 22, of Las Vegas, N.M., and Charlie Gutierrez, 34, of Albuquerque, N.M., with violating the federal narcotics laws. Four of the defendants, Estrada, Garza, Armijo-Romero and Gutierrez were arrested on May 1, 2014, based on a criminal complaint. Castillo and Padilla have yet to be arrested and are considered fugitives. Individuals with information regarding the whereabouts of Castillo and Padilla are asked to call the FBI at 505-622-6001.
Estrada, Garza, Armijo-Romero and Gutierrez were arraigned this morning on the indictment in federal court in Las Cruces, N.M., and each entered a not guilty plea. Estrada and Garza were ordered detained pending trial during detention hearings held this morning. Armijo-Romero and Gutierrez remain in custody pending detention hearings scheduled for May 13, 2014.
The indictment in this case is the result of an investigation primarily targeting a drug trafficking organization operating in Lea County, N.M., that allegedly was led by Castillo. The investigation was led by the FBI and LCDTF with assistance from the DEA and New Mexico State Police. The investigation was designated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program, a nationwide Department of Justice program that combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations.Count 1 of the indictment alleges that between April 28, 2014 and May 1, 2014, the six defendants conspired to possess cocaine with the intention of distributing the drugs in Lea County and elsewhere. Count 2 alleges that the six defendants possessed cocaine with intent to distribute on May 1, 2014, in Bernalillo County, N.M. Counts 3 and 4 allege that Castillo possessed cocaine and heroin with intent to distribute on May 1, 2014, in Lea County. Counts 5 and 6 allege that Garza possessed cocaine and heroin with intent to distribute in Lea County on May 1, 2014. Count 7 charges Garza with using and carrying a firearm in relation to and in furtherance of drug trafficking crimes in Lea County on May 1, 2014.
According to court filings, on April 28 and 29, 2014, the defendants made plans to pool their money to purchase narcotics from a source of supply in Phoenix, Arizona. On April 30, 2014, Estrada traveled to Phoenix allegedly to purchase narcotics. On May 1, 2014, Estrada, Armijo-Romero and Gutierrez traveled from Phoenix to Albuquerque in two vehicles. The three men were stopped by law enforcement officers on Interstate 40 west of Albuquerque and were arrested after the officers found approximately 8.5 kilograms of cocaine in the vehicle Armijo-Romero was driving. Garza was arrested in Hobbs later that day.
Following the arrests of Estrada, Armijo-Romero and Gutierrez, officers executed federal search warrants for six residences in Hobbs. The officers allegedly recovered 23 firearms, 1.6 kilograms of heroin, more than half a kilogram of methamphetamine and an additional 4.1 kilograms of cocaine, for a total of approximately 12.6 kilograms of cocaine.
If convicted on Counts 1 and 2 of the indictment, each of the six defendants faces a mandatory minimum ten years in prison and a maximum of life in prison. Castillo faces a similar sentence if convicted on Count 4. Castillo faces a mandatory minimum of five years to a maximum of 40 years in prison if convicted on Count 3, and Garza faces a similar sentence if convicted on Counts 5 and 6. Garza faces a five-year mandatory minimum prison sentence that must be served consecutive to any other sentence imposed if he is convicted on Count 7. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
This case was investigated by the Roswell and Las Cruces offices of the FBI and the LCDTF, with assistance from the Las Cruces office of the DEA, the New Mexico State Police and the Phoenix Police Department. The case is being prosecuted by the U.S. Attorney’s Las Cruces Branch Office.
The Lea County Drug Task Force is comprised of officers from the Lea County Sheriff’s Office, Hobbs Police Department, Lovington Police Department, Eunice Police Department the Tatum Police Department and the Jal Police Department, and is part of the HIDTA Region VI Drug Task Force. The High Intensity Drug Trafficking Areas (HIDTA) program was created by Congress with the Anti-Drug Abuse Act of 1988. HIDTA is a program of the White House Office of National Drug Control Policy (ONDCP) which provides assistance to federal, state, local and tribal law enforcement agencies operating in areas determined to be critical drug-trafficking regions of the United States and seeks to reduce drug trafficking and production by facilitating coordinated law enforcement activities and information sharing.
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Castillo Indictment
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Castillo, Joe Photo
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Castillo, Leroy Photo
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Federal Charges Brought Concerning Lansing Federal Income Tax Refund ScamRead the Press Release
Over $1,000,000 in tax refunds sought by tax fraudsters.
GRAND RAPIDS, MICHIGAN – U.S. Attorney Patrick A. Miles, Jr. announced today that Takabvako Chiwocha-Crowell, age 40, currently residing in the Dallas, Texas metropolitan area, was charged in a federal indictment in the Western District of Michigan, which alleges a conspiracy to file false claims against the United States government.
The indictment alleges that over six hundred false federal individual tax returns were filed by Chiwocha-Crowell in 2011, with many of those returns submitted to the IRS listing a residential address in the Lansing, Michigan area. The indictment further alleges family members and friends assisted Ms. Chiwocha-Crowell in the scam.
The charges in an indictment are merely accusations, and a defendant is presumed innocent until and unless proven guilty in a court of law.
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Fargo Man Sentenced to 12 Years for His Role in the Death of Local MusicianRead the Press Release
FARGO - U.S. Attorney Timothy Q. Purdon announced that on May 8, 2014 Nathan William Evenson, 27, Fargo, N.D., was sentenced to serve 12 years in prison for conspiracy to distribute a controlled substance, before U.S. District Judge Ralph R. Erickson.
The investigation revealed that Evenson and other co-conspirators would receive shipments of heroin from a source in Minneapolis, Minn., and would distribute them to various people in the F-M area. Evenson and co-defendants Seth Lund and Nicole Wadsworth distributed the heroin that resulted in physical injury and contributed to the death of Cody Conner of Fargo, N.D. Seth Lund was previously sentenced to 7 years in prison. Wadsworth is scheduled for sentencing on June 2, 2014, at 10:30 a.m. U.S. District Court.
Judge Erickson also sentenced Evenson to serve three years supervised release, pay $4367.50 in restitution and a $100 special assessment to the Crime Victims Fund.
The case was investigated by the Drug Enforcement Administration and the Fargo Police Department.
First Assistant U.S. Attorney Chris Myers prosecuted the case.
Eleven Charged in Federal Court with Cocaine Trafficking in the Bronx and Across New York StateRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Janet DiFiore, the Westchester County District Attorney, Scott W. Brown, Tarrytown Police Chief on behalf of the Greenburgh Drug and Alcohol Task Force, and George Venizelos, Assistant Director-In-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced the arrest of 11 defendants and the unsealing of an Indictment and a Superseding Indictment charging a conspiracy to distribute kilogram quantities of cocaine in and around the Bronx, across the Hudson Valley, and up to Albany, New York.
U.S. Attorney Preet Bharara stated: “These arrests are the product of the ongoing and unparalleled cooperation between our office and the Westchester District Attorney’s Office, and between federal and local law enforcement authorities. In particular, it is our privilege to work with District Attorney DiFiore and her team to prosecute alleged narcotics traffickers like the defendants. I want to thank our many federal and local law enforcement partners, representing villages, towns, cities and the nation all of whom coalesced to bring this case.”
Westchester District Attorney Janet DiFiore stated: “Law enforcement from all levels, federal, state and local, collaborated in a multi-jurisdictional effort that stretched from New York City to the Capitol District. This coordinated effort resulted in the takedown of a major narcotics trafficking operation in New York State. Our ongoing joint efforts with the United States Attorney’s office and the assistance of U.S. Attorney Preet Bharara in this and other prosecutions is a model of collaborative law enforcement and its results.”
Chief Scott W. Brown of the Tarrytown Police Department, speaking for the Greenburgh Drug and Alcohol Task Force, stated: “We are extremely proud of our officers and grateful for the assistance and cooperation of all agencies involved. The dedication and diligence of these law enforcement professionals will have a significant impact on the flow of illegal drugs in our communities.”
FBI Assistant Director-in-Charge George Venizelos stated: “Today, we were able to disrupt and dismantle yet another drug trafficking organization whose primary goal was to distribute cocaine in the surrounding areas. The arrests and searches were carried out today with our law enforcement partners working side by side to make the streets safer.”
According to allegations in the Indictments unsealed today:
The Indictments charge eleven people, PHILLIP LLENAS, a/k/a “Bemba,” 39, FRANKLIN ABREU, 28, SHERMAN ALSTON, a/k/a “Sherm,” 51, VICTOR ANDRADES, a/k/a “Fat Man,” 38, JAMES FERNANDEZ, a/k/a “Burg,” a/k/a “Burger,” 32, FERNANDO GUERRERO, 31, JOSE PEREYRA, a/k/a “Nano,” 33, MENSUR RADONCIC, a/k/a “Stu,” 31, KEENAN SOTO, a/k/a “Chinito,” 25, and KARL ZARATE, 38, with conspiring to distribute, and possess with intent to distribute, five kilograms or more of cocaine in Westchester County, New York, Orange County, New York, Albany County, New York and the Bronx, New York. The Superseding Indictment charges ANGEL APONTE, a/k/a “A,” 34, with conspiring to distribute, and possess with intent to distribute, five kilogram or more of cocaine. The charge against each defendant and the corresponding maximum potential penalties are outlined in the chart attached to this press release.
All eleven of the defendants charged in the Indictments unsealed today were arrested. Ten of the defendants were presented in White Plains federal court this afternoon before U.S. Magistrate Judge Paul E. Davison. One defendant, ALSTON, is scheduled to be presented at 2:00 p.m. tomorrow before Judge Davison.
Contemporaneous with the arrests, state and federal law enforcement officers executed search warrants at 24 locations and upon 4 vehicles. These searches resulted in the seizure of more than $800,000 cash, more than 5 kilograms of cocaine, approximately 40 pounds of marijuana, eight firearms, several kilo presses and other drug trafficking paraphernalia.
Mr. Bharara praised the outstanding investigative work of the FBI, the Greenburgh Drug and Alcohol Task Force, comprised of the police departments of the Town of Greenburgh, and the Villages of Ardsley, Dobbs Ferry, Elmsford, Hastings, Irvington, North Castle, Sleepy Hollow, and Tarrytown, the Westchester District Attorney’s Office, the New York State Police, the Yonkers Police Department, the U.S. Department of Homeland Security, the U.S. Drug Enforcement Administration, and the New York City Police Department.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Michael Gerber and Scott Hartman are in charge of the prosecution. Assistant U.S. Attorney Paul Monteleoni is responsible for the forfeiture aspects of the case.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
United States v. Aponte, S1 14 Cr. 268
United States v. Llenas, et al., 14 Cr. 268
Takedown ChartElba I. Bonilla-Bayon Indicted and Arrested for Theft of Government PropertyRead the Press Release
SAN JUAN, P.R. – Yesterday, May 7, a Federal grand jury returned a 175 count-indictment against Elba I. Bonilla-Bayón for theft of government property, concealment of bankruptcy assets, student assistance program fraud, money laundering and aggravated identity theft, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. The defendant is facing a forfeiture allegation of $1,429,873.00.
According to the indictment, from on or about January, 2010 through on or about December 2012, the defendant wilfully and knowingly stole and purloined goods of the United States, that is, funds from Head Start / Early Head Start Programs; Child Care Development Fund Program; Child and Adult Care Food Program; and the American Recovery and Reinvestment Act, property of the United States of the value of $1,429,873.00, in checks ranging from $1,000 to $37,000, which said property had come into the possession and under the care of Elba I. Bonilla-Bayón by virtue of her employment as a President and Chairman of the Board for Programa Avance en Puerto Rico, grantee and delegated agency of United States Department of Health and Human Services (Head Start, Early Head Start and Child Care Development Fund Program) and the United States Department of Agriculture (Child and Adult Care Food Program).
Bonilla-Bayón operated and administered 49 Head Start / Early Head Start centers in the municipalities of Loíza, Canóvanas, Río Grande and Luquillo that served 1,318 children. From in or around January 2010, continuing through in or around December, 2012 the defendant through Programa Avance en Puerto Rico, opened approximately 35 bank accounts at Westernbank, Banco Popular de Puerto Rico, Banco Santander and Cooperativa de Ahorro y Crédito Metodistas Unidos de Puerto Rico. She received approximately $30,800,178.45 in federal funds from multiple federal agency programs, including but not limited to Head Start Program, Early Head Start Program, Child Care Program, Child and Adult Care Food Program (CACFP) and the American Recovery and Reinvestment Act.
During the scheme, Bonilla-Bayón through Programa Avance en Puerto Rico began receiving funds under the CACFP for reimbursement of the meals and snacks it was purportedly providing to children in its programs. From that time until in or around December 2012, Avance received a total of approximately $549,736.28 as a direct result of monthly records the defendant signed and provided to the Puerto Rico Department of Education.
Also, according to the indictment, on or about September 25, 2010, Bonilla-Bayón opened an account at the San Juan Marriott Resort & Stellaris Casino and was approved a credit line of up to $30,000.00 as a local player. The majority of the funds stolen by the defendant were spent by her at the San Juan Marriott Resort & Stellaris Casino.
In addition to the scheme purported by the defendant, Bonilla-Bayón filed for bankruptcy under the provisions of Chapter 11 at the United States Bankruptcy Court for the District of Puerto Rico. The defendant, knowingly and fraudulently concealed property belonging to Programa Avance en Puerto Rico, specifically a Child and Adult Care Food Program (USDA) check payment of $99,307.03, from the trustee charged with control of the debtor’s property, from the creditors and the United States Trustee.
The defendant herein knowingly engaged and attempted to engage in monetary transactions affecting interstate and foreign commerce in criminally derived property of a value greater than $10,000, such property having been derived from the specified unlawful activity of Concealment of Bankruptcy Assets. Specifically, the indictment details at least four payments ranging from $13,000 to $18,000 Bonilla-Bayón made to the San Juan Marriott Resort & Stellaris Casino with the money concealed from the United States Trustee.
The aggravated identity theft charges relate to monthly reports submitted by Bonilla-Bayón to the Puerto Rico Family Department in order to receive the funds using the identity of the Head Start Program participants as she knowingly possessed, used, and transferred without lawful authority, a means of identification of the Head Start Program beneficiaries (Name, Date of Birth and Family ID) in connection to the theft of government funds.
The Student Financial Aid Fraud charge relates to the fact that the defendant did knowingly and willfully fail to refund $13,185.50, as required by federal regulation, to the United States Department of Education. These funds were received as Pell grant moneys for students at Centro de Capacitación y Asesoramiento Vetelba, Inc. who did not complete their course of study or were otherwise not entitled to Pell grants.
“The defendant took advantage of her managerial position in Programa Avance en Puerto Rico and stole directly from the government of the United States, money that was intended to be used for children’s education and development,” said United States Attorney Rosa Emilia Rodríguez-Vélez. “The vast majority of government employees are hardworking members of our community, but those who betray the trust and use their position for personal gain should know that they will be investigated and prosecuted to the full extent of the law.”
“I am proud to be part of the Federal team that brought Elba Bonilla to justice,” said Tom O’Donnell, Special Agent in Charge of Health and Human Services OIG (HHS/OIG). “Greed, at the expense of valuable HHS Head Start Grant funds, will not be tolerated. These funds are needed to nurture low-income children and their families. I would like to thank HHS/OIG’s Office of Audit Services for their expertise in the audit of Programa Avance, and for providing significant support during the investigation.”
“The defendant’s criminal activities remind the public that fraud against the United States government remains an ongoing problem in our country,” said Carlos Cases, Special Agent in Charge of the FBI, San Juan Field Office. “The FBI and our law enforcement partners are committed to preventing and prosecuting fraud against the government at all levels.”This case was investigated by the US Department of Health and Human Services, Office of Inspector General (Investigations / Audit Services), with the collaboration of the Federal Bureau of Investigation, the US Department of Agriculture, Office of Inspector General, the US Trustee Office, and the US Department of Education, Office of Inspector General.
The case is being prosecuted by Special Assistant U.S. Attorneys Wallace A. Bustelo and Pedro R. Casablanca. If found guilty, the defendant could face a possible sentence of 10 years in prison for theft of government property and engaging in monetary transactions in property derived of specific unlawful activity, five years of imprisonment and a fine of up to $250,000.00 for the concealment of bankruptcy assets, and two additional years for each aggravated identity theft count. A criminal indictment contains only charges and is not evidence of guilt. Defendants are presumed to be innocent unless and until proven guilty.El Secretario de Justicia de los Estados Unidos Holder y el Secretario Duncan Emiten Orientación Para los Distritos Escolares para Garantizar el Acceso Igualitario a las Escuelas Públicas para Todos los Niño...Read the Press Release
WASHINGTON - El Secretario de Justicia de los Estados Unidos Eric Holder y el Secretario Arne Duncan anunciaron hoy la emisión de una orientación actualizada para ayudar a las escuelas públicas primarias y secundarias a garantizar que los procesos de matriculación sean compatibles con la ley y cumplir con su obligación de brindar acceso igualitario a la educación a todos los niños, independientemente de su procedencia.
En 2011, los Departamentos de Justicia y Educación emitieron una orientación para ayudar a las escuelas a comprender sus responsabilidades bajo el fallo de la Corte Suprema en Plyler contra Doe y las leyes federales de derechos civiles de brindar acceso igualitario a la educación a todos los niños, independientemente de su situación inmigratoria o la de sus padres. Hoy, los departamentos están emitiendo importantes actualizaciones a dicha orientación, la que incluye ejemplos de prácticas de matriculación permitidas, así como ejemplos de los tipos de información que no pueden usarse como base para denegar el ingreso de un estudiante a la escuela.
Los documentos de orientación actualizados—los que incluyen una carta orientativa a los estados y los distritos escolares y una hoja informativa y un documento de preguntas y respuestas—destacan la necesidad de flexibilidad al aceptar documentos de los padres para probar la edad de un menor y probar que el menor vive en el área de servicio de una escuela. También brindan ejemplos específicos de los tipos de documentos que muchas escuelas han aceptado. Los documentos orientativos recuerdan a las escuelas que no pueden exigir ciertos documentos—tales como una licencia de conducir de un padre o una madre, emitida por el estado—cuando dicha exigencia impediría la matriculación de un estudiante debido a la situación inmigratoria de su padre o madre.
"Los distritos de escuelas públicas tienen la obligación de matricular a los alumnos independientemente de su situación inmigratoria y sin discriminar debido a raza, color u origen nacional", señaló el Secretario de Justicia de los Estados Unidos Eric Holder. "El Departamento de Justicia hará todo lo posible para garantizar que las escuelas cumplan con esta obligación. Haremos valer la ley para asegurar que la puerta de la escuela permanezca abierta para todos".
"Queremos garantizar que cada líder escolar comprenda las exigencias legales según la Constitución y las leyes federales, y esperamos que esta actualización corrija algunos conceptos erróneos", indicó el Secretario Arne Duncan. "El mensaje es claro: permitan que todos los niños que viven en su distrito se inscriban en sus escuelas públicas".
En los tres años desde la emisión original de la orientación en 2011, los departamentos vienen trabajando en conjunto con los estados y los distritos escolares en todo el país para lograr el cumplimiento de acuerdo con Plyler y las leyes federales de derechos civiles que prohíben la discriminación debido a raza, color y origen nacional.
Los cambios importantes anunciados hoy brindarán a los distritos herramientas adicionales y la orientación práctica necesarias para asegurar que la puerta de la escuela esté abierta para todos los estudiantes, y que menores indocumentados y menores pertenecientes a familias inmigrantes ya no enfrenten barreras para la matriculación en la escuela y para su camino hacia un futuro mejor.
District Woman Pleads Guilty to Health Care Fraud, Sold Counterfeit Documents to Would-Be Home Health Care Aides-Documents Needed to Gain Work, Confirm Qualifications-Read the Press Release
WASHINGTON – Adoshia L. Flythe, 36, of Washington, D.C., pled guilty today to a federal charge of health care fraud following an undercover investigation into the sale of counterfeit health certificates to people seeking jobs in the home health care industry.
The plea was announced by U.S. Attorney Ronald C. Machen Jr.; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Nicholas DiGiulio, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), for the region that includes Washington, D.C.; and Charles J. Willoughby, Inspector General for the District of Columbia.
Flythe pled guilty in the U.S. District Court for the District of Columbia. The Honorable Rudolph Contreras scheduled sentencing for Sept. 4, 2014. The charge carries a statutory maximum of 10 years in prison as well as financial penalties. Under federal sentencing guidelines, Flythe faces up to six months of incarceration and a fine of up to $5,000.
Flythe, a personal care aide, was one of 24 people -- including operators of home care agencies and nurse staffing agencies, office workers, and personal care aides -- arrested in late February 2014, following investigations into fraudulent billing practices in the home health care industry. The investigations uncovered numerous, separate schemes involving fraud, kickbacks, and false billings in the growing field of home care services for District of Columbia Medicaid patients. She is the first defendant to plead guilty in the various schemes.
The home health care industry includes services intended to assist people in performing the activities of daily living, such as getting in and out of bed, bathing, dressing, taking medication, and other needs. Such services are provided by personal care aides, who often work for home care agencies and nurse staffing agencies. In order to be reimbursed by D.C. Medicaid, the personal care aides performing the services had to have documentation showing that they meet numerous qualifications as set forth by D.C. regulations.
In her guilty plea, Flythe admitted selling packages of counterfeit documentation to two individuals, charging them $350 apiece. The fraudulent documents Flythe sold included a counterfeit “Home Health Care Aide” certificate from the University of the District of Columbia and a counterfeit “Health Certificate for Staff” that contained the forged name and signature of at least one doctor. The two individuals who purchased the documents from Flythe purportedly wanted to apply for employment with a home care agency and to cause Medicaid to be billed for personal care services; actually they were working as part of the undercover investigation.
In announcing the guilty plea, U.S. Attorney Machen, Assistant Director in Charge Parlave, Special Agent in Charge DiGiulio, and Inspector General Willoughby commended the work of those who investigated the case. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Donna Galindo, Krishawn Graham, Corinne Kleinman, and Nicole Wattelet.
Finally, they expressed appreciation for the work of the prosecutors handling the health care cases, including Assistant U.S. Attorney Michael J. Friedman, who appeared in court today, Assistant U.S. Attorneys David Johnson, Ted Radway, Lionel André, and Special Assistant U.S. Attorney Dangkhoa Nguyen.
14-107Defendant Sentenced in Manhattan Federal Court to Six Months in Prison and Six Month’s Home Confinement for Being A Leader of an International Multimillion-Dollar Illegal Sports Gambling BusinessRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that ILLYA TRINCHER was sentenced today in Manhattan federal court to six months in prison followed by six months’ home confinement in connection with his leadership role in the operation of a high-stakes illegal sports gambling business. TRINCHER was also ordered to forfeit approximately $6.4 million. He was sentenced by U.S. District Judge Jesse M. Furman.
According to the Indictment, other documents filed in Manhattan federal court and statements made at various proceedings in this case, including today’s sentencing:
TRINCHER and defendant Hillel Nahmad, a/k/a “Helly,” operated and led a nationwide illegal gambling business in New York City and Los Angeles that catered primarily to multi-millionaire and billionaire clients. As part of this business, the organization ran a high-stakes, illegal sportsbook that utilized several online gambling websites operating illegally in the United States. The organization booked bets that were often in the hundreds of thousands of dollars, and at times a million dollars, on a single sporting event. The organization also made millions of dollars of sports bets each year.
Twenty-nine defendants in this case have pled guilty, and two have entered into deferred prosecution agreements. The defendants who have pled to date have agreed to forfeit, in total, more than $69,000,000. The following defendants have pled guilty, and have been or await sentencing:
- Bryan Zuriff pled guilty to gambling charges on July 26, 2013, and was sentenced on November 25, 2013.
- William Barbalat pled guilty to gambling charges on August 14, 2013, and was sentenced on December 16, 2013.
- Kirill Rapoport pled guilty to gambling charges on August 16, 2013, and was sentenced on December 19, 2014.
- Edwin Ting and Justin Smith pled guilty to gambling charges on September 4, 2013, and were sentenced on January 21, 2014, and January 6, 2014, respectively.
- Dmitry Druzhinsky and David Aaron pled guilty to gambling charges on October 4, 2013, and were sentenced on April 18, 2014, and February 14, 2014, respectively.
- Alexander Zaverukha pled guilty to gambling charges on October 10, 2013, and was scheduled on May 1, 2014.
- Nicholas Hirsch pled guilty to conspiring to commit wire fraud on October 16, 2013, and was sentenced on February 25, 2014.
- Anatoly Shteyngrob pled guilty to conspiring to commit money laundering on October 17, 2013, and is scheduled to be sentenced on June 10, 2014.
- Yugeshwar Rajkumar pled guilty to gambling charges on October 18, 2013, and was sentenced on March 25, 2014.
- Stan Greenberg pled guilty to conspiring to commit racketeering on October 22, 2013, and was sentenced on May 2, 2014.
- Arthur Azen pled guilty to conspiring to commit money laundering and conspiring to collect extensions of credit by extortionate means on November 5, 2013, and was sentenced on April 9, 2014.
- Hillel Nahmad pled guilty to gambling charges on November 12, 2013, and was sentenced on April 30, 2014.
- Vadim Trincher pled guilty to conspiring to commit racketeering on November 14, 2013, and was sentenced on April 30, 2014.
- Eugene Trincher pled guilty to gambling charges on November 14, 2013, and is scheduled to be sentenced on June 9, 2014.
- Anatoly Golubchik pled guilty to conspiring to commit racketeering on November 15, 2013, and was sentenced on April 29, 2014.
- Illya Trincher pled guilty to gambling charges on November 15, 2013, and was sentenced on May 8, 2014.
- Ronald Uy pled guilty to structuring financial transactions on November 25, 2013, and was sentenced on March 27, 2014.
- Moshe Oratz pled guilty to gambling charges on December 3, 2013, and was sentenced on April 9, 2014.
- Michael Sall pled guilty to interstate travel in aid of an unlawful activity (illegal gambling), and Jonathan Hirsch pled guilty to gambling charges on December 4, 2013. Sall was sentenced on April 18, 2014, and Hirsch is scheduled to be sentenced on May 9, 2014.
- Noah Siegel pled guilty to gambling charges on December 5, 2013, and was sentenced on April 10, 2014.
- Molly Bloom pled guilty to gambling charges on December 12, 2013, and was be sentenced on May 2, 2014.
- Alexander Katchaloff pled guilty to gambling charges on January 16, 2014, and is scheduled to be sentenced on May 20, 2014.
- Donald McCalmont, John Jarekci, a/k/a “John Hanson,” and Abraham Mosseri pled guilty to making a fraudulent tax statement, to failing to file a tax return, and to causing a financial institution to participate in a lottery related matter, respectively, on January 24, 2014. McCalmont was sentenced on May 7, 2014, and Jarekci and Mosseri are scheduled to be sentenced on May 28, 2014, and May 21, 2014, respectively.
- William Edler and Peter Feldman entered into deferred prosecution agreements on April 11, 2014.
- Illya Rozenfeld pled guilty to interstate travel in aid of an unlawful activity (illegal gambling) on May 6, 2014, and is scheduled to be sentenced on August 14, 2014.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation, the New York City Police Department, and the Internal Revenue Service.
The case is being prosecuted by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Harris M. Fischman, Joshua A. Naftalis, Peter J. Skinner, and Kristy J. Greenberg of the Violent and Organized Crime Unit are in charge of the prosecution. Assistant U.S. Attorney Alexander Wilson of the Office’s Money Laundering and Asset Forfeiture Unit is responsible for the forfeiture aspects of the case.
Daytona Beach Tax Preparer Sentenced to PrisonRead the Press Release
Orlando, Florida – U.S. District Judge Charlene Edwards Honeywell today sentenced Fane Dacosta (40, Daytona Beach) to 2 years and 4 months in federal prison for aiding in the preparation of false tax returns and failing to file his own tax returns. Dacosta was also ordered to serve one year of supervision, following his incarceration, and to pay $656,084 in restitution to the Internal Revenue Service. Dacosta was convicted by a federal jury on January 30, 2014.
According to evidence presented at trial, Dacosta was the owner of a tax return business (“More Than Enaf Refund & Affordable Tax Services”) in Holly Hill, Florida. For the tax years 2006 through 2009, Dacosta prepared returns for individuals in which he falsified the amounts of deductions and tax credits owed to taxpayers, resulting in those taxpayers receiving undeserved tax refunds. In particular, Dacosta fraudulently claimed education credits for clients who never attended college, and he inflated itemized deductions. In response to the false returns that Dacosta prepared, the Internal Revenue Service issued more than $500,000 in undeserved refunds. In addition, Dacosta failed to file his personal tax returns in 2007, 2008, and 2009, despite earning over $100,000, $200,000, and $300,000 in each of those years, respectively.
This case was investigated by the Internal Revenue Service - Criminal Investigation Division. It was prosecuted by Assistant United States Attorney Roger B. Handberg.
DEA’s Albuquerque Office Spearheads New Mexico’s Multi-Agency Participation in Nationwide Synthetic Drug Takedown Thirteen Search Warrants, Eleven Seizure Warrants and Seven Arrests Executed in Albuquerque on May 7, 2014 as Part of Project Synergy PhaseRead the Press Release
ALBUQUERQUE – Yesterday the Drug Enforcement Administration (DEA), Customs and Border Protection (CBP), Immigration and Customs Enforcement Homeland Security Investigations (HSI), Federal Bureau of Investigation (FBI), Internal Revenue Service (IRS) and other federal, state, and local partners announced the culmination of Project Synergy Phase II, an ongoing effort targeting every level of the dangerous global synthetic designer drug market. Since January and leading up to early this morning, nationwide enforcement operations have taken place targeting these drug trafficking organizations that have operated in communities across the country.
According to the announcement, Project Synergy II began in Jan. 2014 and culminated yesterday with law enforcement operations in 29 states that involved more than 45 DEA offices serving nearly 200 search warrants. The Albuquerque District Office of the DEA coordinated New Mexico’s participation in the nationwide takedown which included the FBI, U.S. Marshal’s Service, U.S. Postal Inspection Service, Albuquerque Police Department, Bernalillo County Sheriff’s Office, the HIDTA Region I Middle Rio Grande Task Force, HIDTA Region III Narcotics Task Force and the Safe City Strike Force.
“The abuse of dangerous synthetic drugs has become a nationwide concern,” said Special Agent in Charge Joseph M. Arabit of the El Paso Division of the DEA. “DEA, with the help of our law enforcement partners, will continue to identify, investigate, arrest, and seize the illicit assets of those who manufacture and deal in these substances. Individuals, retailers and organizations that continue to circumvent the law and engage in the trafficking of these dangerous drugs should be on notice that law enforcement agencies will utilize all available resources to hold them accountable for their actions.”
The New Mexico operation included the arrest of five individuals on federal synthetic drug trafficking charges and one individual on state synthetic drug trafficking charges, and the execution of 11 federal search warrants, 11 federal seizure warrants and two state search warrants in Albuquerque, N.M.Amjad Al-Washah, 27, Sabah Al-Washah, 47, Iman Al-Washah, 23, Sajey Beirat, 19, and Ramzi Kahalah, 53, all of Albuquerque, were arrested yesterday based on federal criminal complaints:
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Amjad Al-Washah is charged with distribution of a controlled substance analogue based on his alleged sale of synthetic cannabinoid to an undercover officer at Carlos’ Smoke Shop at 806 Old Coors Drive SW in Albuquerque on Dec. 4, 2013.
Iman Al-Washah is charged with conspiracy and distribution of a controlled analogue based on his participation in the alleged sale of synthetic cannabinoid to an undercover officer at Carlos’ Smoke Shop on Jan. 7, 2014.
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Sabah Al-Washah, the owner of Carlos’ Smoke Shop, is charged with conspiracy and aiding and abetting the distribution of a controlled analogue based on an alleged sale of synthetic cannabinoid to an undercover officer at the smoke shop on Jan. 7, 2014. Sabah Al-Washah also is charged with maintaining drug-involved premises.
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Sajey Beirat is charged with distribution of a controlled substance based on his alleged sale of synthetic cannabinoid to an undercover officer at C Jay’s Smoke Shop at 5823 Osuna NE in Albuquerque on March 6, 2014.
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Ramzi Kahalah, the owner of C Jay’s Smoke Shop, is charged with maintaining drug-involved premises.
The five defendants made their initial appearances in federal court this morning and remain in custody pending detention hearings scheduled tomorrow morning. If convicted on the distribution and conspiracy charges, each of the five defendants faces a statutory maximum penalty of 20 years in prison. If convicted on the maintaining drug-involved premises charges, Sabah Al-Washah and Ramzi Kahalah each face a maximum statutory penalty of 20 years in prison.
Fidel Abdeljawad, 46, of Albuquerque, was arrested on a state criminal complaint charging him with possession with intent to distribute a control substance, synthetic cannabinoids, a fourth degree felony. Abdeljawad’s bond was set at $150,000 cash or surety. If convicted, Abdeljawad faces up to 18 months in prison.
Charges in criminal complaints are merely accusations and the defendants are presumed innocent unless found guilty in a court of law.
During yesterday’s law enforcement operation, officers seized more than $275,000 in cash, approximately 12,000 packages of suspected synthetic cannabinoid, more than half a kilogram of treated suspected synthetic cannabinoid that had not yet been packaged and 13 vehicles valued at more than $450,000. The vehicles seized included a Lamborghini, two Dodge Vipers and a Cadillac CTSV with a 1000 horsepower racing engine.
The federal cases are being prosecuted by Assistant U.S. Attorneys Jennifer M. Rozzoni and Jack E. Burkhead and related forfeiture matters are being handled by Assistant U.S. Attorney Stephen R. Kotz. The state case is being prosecuted by Assistant District Attorney Jason Yamato of the 2nd Judicial District Attorney’s Office.
The DEA’s Albuquerque District Office also participated in investigation that contributed to Project Synergy II’s law enforcement operations in the Atlanta, Ga., metropolitan area. Those operations included the seizure of bank accounts containing an aggregate of $1.4 million, $150,000 to $200,000 in cash, 177 kilograms of synthetic cannabinoid, 800 processed packages of synthetic cannabinoid, and 250 pounds of untreated spice plant material.
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Synergy Complaint 14-MJ-1554
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Synergy Complaint 14-MJ-1555
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Synergy Complaint 14-MJ-1556
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Synergy Complaint 14-M-1557
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Synergy Complaint 14-MJ-1558
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Cranston, West Warwick Businessman Charged in Federal Court with Possession with the Intent to Distribute “Bath Salts”Read the Press Release
PROVIDENCE, R.I. – Glen Lonardo, 48, of Cranston, owner of Buddha’s Bazaar in Cranston and XCitement Video and Smoke Shop in West Warwick, appeared before U.S. District Court Judge Lincoln D. Almond today on a federal criminal complaint charging him with allegedly possessing synthetic drugs with the intent to distribute, announced United States Attorney Peter F. Neronha, John J. Arvanitis, Special Agent in Charge of the DEA’s New England Field Division, Cranston Acting Police Chief Rhode Island State Police Captain Kevin M. Barry and West Warwick Police Chief Colonel Richard G. Silva.
Lonardo’s arrest earlier today by members of the RI DEA Drug Task Force follows a year-long investigation by the Drug Task Force, Cranston Police and West Warwick Police into the alleged sale of “bath salts” at Lonardo’s Cranston and West Warwick businesses. Lonardo’s arrest is one of more than 150 DEA led arrests of alleged synthetic drug makers, wholesalers and retailers in 30 states over the past two days.
Lonardo is charged with one count of possession with intent to distribute a mixture and substance containing a detectable amount of: a-Pyrrolidinovalerophenone (a-PVP), an analog of methylenedioxypyrovalerone (MDV), a Schedule I controlled substance, commonly referred to as “bath salts.” Bath salts is a generic term applied to a variety of chemical substances sold under various names for purported use as bath salts, glass cleaner, or incense (among other things) but which is being consumed, smoked or injected by drug addicts to experience a “high.” The various chemical substances are often scheduled drugs or analogues of scheduled drugs.
According to an affidavit filed with the court, Cranston Police began an investigation into the alleged distribution and use of “bath salts’’ in the early spring and summer of 2013, after receiving numerous complaints of apparent drug overdoses and erratic behavior in the general vicinity of Buddha’s Bazaar. The investigation, including surveillance of the area and alleged undercover purchases of bath salts called “Nuke” from Buddah’s Bazaar, resulted in a federal court authorized search of the business in August 2013. During the execution of the search warrant, law enforcement seized nearly 200 packets and bags of bath salts, some labeled Nuke, Krush, Frenzy and Blast.
According to the affidavit, following the execution of the search warrant at Buddha’s Bazaar, the investigation into the alleged sale of bath salts was expanded to include Lonardo’s West Warwick business, XCitement Video and Smoke Shop. The investigation allegedly included numerous undercover purchases of bath salts by West Warwick Police.
According to the affidavit, on January 17, 2014, West Warwick Police responded to a reported breaking and entering at XCitement Video and Smoke Shop. While processing the alleged burglary, West Warwick Police allegedly came across numerous packages labeled “Nuke.” West Warwick Police applied for, received and then executed a court authorized search warrant for XCitement Video and Smoke Shop. Additional bath salts were allegedly seized during the search and Lonardo was arrested on state drug charges.
A criminal complaint is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.Lonardo was released on $10,000 unsecured bond following his initial appearance in U.S. District Court.
Possession with the intent to distribute a mixture containing a detectable amount of a Schedule I controlled substance is punishable by a statutory penalty up to 20 years in federal prison and a fine of up to $1,000,000.
The case is being prosecuted by Assistant U.S. Attorney Gerard B. Sullivan.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]Crab Orchard Man Pleads Guilty to Selling Addictive Prescription Pain PillsRead the Press Release
BECKLEY, W.Va. – United States Attorney Booth Goodwin announced today that Gene James, also known as “Butch,” 44, of Crab Orchard, West Virginia, pleaded guilty in federal court in Beckley to distributing a quantity of oxycodone, a powerful and addictive prescription pain medication. James admitted that on November 13, 2013, he sold pills to a person who was cooperating with law enforcement authorities. The drug deal took place on Hot Coal Road in Sophia, Raleigh County, West Virginia.
James faces up to 20 years in prison and a $1,000,000 fine. United States District Judge Irene C. Berger scheduled the sentencing for August 21, 2014.
The Beckley/Raleigh County Drug and Violent Crime Unit conducted the investigation.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers.
Connecticut Man Pleads Guilty in Multi-Million Dollar Diploma FraudRead the Press Release
PHILADELPHIA – James Enowitch, 48, of Cromwell, CT, pleaded guilty today to mail fraud and aiding and abetting mail fraud, in connection with the operation of a number of fraudulent diploma mills, announced United States Attorney Zane David Memeger. Between 2003 and 2012, Enowitch sold $5 million worth of fake degrees throughout the world. He profited more than $700,000 from this fraudulent scheme.
As early as 2003, Enowitch began operating a diploma mill, through which he advertised and sold diplomas for a fee, requiring no course work for those “diplomas.” Enowitch and his alleged co-schemer ultimately operated at least seven different websites, through which they sold fraudulent degrees in the name of Redding University, Suffield University Glendale University, Greenwood University, and Bryson University. Those purported universities were actually diploma mills in that they had no faculty, offered no academic curricula or services, required no course or class work, and were not recognized by the United States Department of Education. Part of the scheme to which Enowitch pleaded guilty was a fraudulent accrediting body, called the “National Distance Learning Accreditation Council” (“NDLAC”), used to claim, falsely, that the diploma mills were “nationally accredited.”
Enowitch admitted that he and others created phony transcripts stating that the purchaser had taken courses that the purchaser had never taken; allowed purchasers to create their own transcripts and backdate degrees; and provided fraudulent verification services to back up the fake degrees, in case an employer or other party sought verification. The degree packages ranged in price from $475 to $550 for associates, bachelors, masters, and doctoral-level degrees, with a “multi-degree discount” for buying more than one. For an additional fee, purchasers could also allegedly select grades for the phony courses included in their transcripts.
The defendant faces a maximum possible sentence of 20 years in prison, three years of supervised release, a $250,000 fine, a $100 special assessment, and an order of forfeiture.
The case was investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services Office of the Inspector General, the Defense Criminal Investigative Service, and U.S. Immigrations and Customs Enforcement Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Matthew J.D. Hogan.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Colorado Resident Charged in California Marijuana ConspiracyRead the Press Release
FRESNO, Calif. —Mark Jeff Zeldes, 52, of Broomfield, Colo., appeared today in federal court in Fresno to face charges contained in an indictment of cultivating and distributing marijuana, United States Attorney Benjamin B. Wagner announced.
According to court documents, between June 1, 2009, and March 9, 2010, Zeldes was responsible for a large-scale marijuana cultivation and distribution operation with multiple indoor grow locations in Bakersfield, Newbury Park, and Northridge, Calif. After being questioned by law enforcement agents in California, Zeldes relocated to Colorado where he continued to engage in marijuana cultivation and interstate distribution activities.
Following his arrest on April 8, 2014, Zeldes was brought before a U.S. Magistrate Judge in Denver, who ordered him detained as a flight risk and danger to the community. Zeldes remains in custody and is next scheduled to appear in court in Fresno for a status conference on June 23, 2014.
If convicted, Zeldes faces a statutory penalty of 10 years to life in prison and a $10 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an investigation by the U.S. Drug Enforcement Administration with assistance from the U.S. Marshal Service and Bakersfield Police Department. Assistant United States Attorney Karen Escobar is prosecuting the case.
Charleston Felon Pleads Guilty to Illegally Possessing FirearmRead the Press Release
CHARLESTON, W. Va. -- Mark Johnson, Jr., 23, pleaded guilty today in federal court to being a felon in possession of a firearm in Charleston, WV, where he resides. In November 2013, Johnson was involved in an altercation outside the Town Center Mall and he brandished a firearm during that altercation. Johnson has two prior felony convictions – both involving firearms. Johnson faces up to 10 years’ imprisonment when he is sentenced on August 20, 2014.
This case was investigated by the Charleston Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. United States District Judge Thomas E. Johnston conducted today’s guilty plea hearing.
Centreville Man Sentenced for Heroin and Weapon OffensesRead the Press Release
Follow @SDILNewsBeckley, 30, of Centreville, Illinois, pled guilty to both federal charges on October 30, 2013. He has been continuously confined since last October.
At his change of plea hearing, Beckley admitted that he had been selling heroin for about two years, and that his heroin supplier was Deborah Perkins. Perkins was arrested on January 21, 2013, a few minutes after police saw her deliver heroin to Beckley’s residence. Perkins was convicted of distributing heroin and sentenced to 324 months imprisonment on December 5, 2013.
Beckley was one of several defendants convicted of selling heroin provided by Perkins. Others include Sean McGilvery and Perkins’ son, Douglas Oliver.
At Beckley’s sentence hearing, Chief U.S. District Court Judge David R. Herndon warned Beckley that he “could have easily killed someone on any one of the occasions when you sold heroin.” Two women did in fact die from ingesting heroin at Perkins’ former residence in Fairview Heights, Illinois.
The investigation which led to Beckley’s conviction and sentence was conducted by DEA Task Force agents, and by police officers assigned to the Metropolitan Enforcement Group of Southwestern Illinois (MEGSI).
The case was prosecuted by Assistant United States Attorney Robert L. Garrison.
Cedar Rapids Man Sentenced to More Than Eight Years for Being A Felon in Possession of A Stolen FirearmRead the Press Release
A felon who was apprehended after crashing a stolen vehicle while fleeing from police was sentenced today to more than eight years in federal prison after officers found a loaded stolen handgun in the vehicle.
Jacob Voshell, age 46, from Cedar Rapids, Iowa, received the prison term after a January 22, 2014, guilty plea to one count of being a felon in possession of a firearm.
In a plea agreement, Voshell admitted that, in the early morning hours of August 7, 2013, he fled from police in a stolen vehicle when officers tried to stop him for driving the wrong way on a one-way street. Voshell eventually crashed the vehicle and attempted to flee on foot when he was arrested. A search of the stolen vehicle revealed a police scanner, burglary tools, stolen license plates, personal use amounts of controlled substances, drug use paraphernalia, and a loaded, stolen, .380 caliber handgun. Voshell was prohibited from possessing firearms because he was a felon, having been convicted in 1987 of Robbery in the First Degree and Sexual Abuse in the Second Degree.
Voshell was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Voshell was sentenced to 105 months’ imprisonment. The sentence was based, in part, on the fact Voshell recklessly endangered the lives of others while fleeing from the police. The Court held that the sentence was to run consecutively to an undischarged sentence of seven years Voshell is serving for three other convictions imposed by the Iowa District Court for Linn County: 1) Theft 2nd Degree; 2) Theft 2nd Degree and Possession of Burglary Tools; and 3) Burglary 3rd Degree. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Voshell is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was being prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Cedar Rapids Police Department. This case was a result of the Cedar Rapids Safe Streets Task Force and was in furtherance of the Project Safe Neighborhoods initiative.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-cr-91.
Carlisle Woman Charged with Social Security FraudRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today it filed a Criminal Information in U.S. District Court in Harrisburg charging a Carlisle woman with theft of more than $500,000 in Social Security Administration benefits paid to Stock’s mother over the past 30 years.
According to United States Attorney Peter Smith, Susan Stock, 71, of Carlisle, PA signed a plea agreement with the United States that was also filed today. Stock agreed to plead guilty to the one-count Information that charges her with theft of government funds. Stock faces up to 10 years imprisonment and a fine of up to $250,000.00. Stock has also agreed to make restitution to the Social Security Administration (SSA) in the amount of $523,683.20.
According to the U.S. Attorney’s Office, in 2013 investigators for the Social Security Administration’s Office of Inspector General discovered the fraud when trying to arrange an interview with Stock’s mother, who had been receiving SSA benefits since at least April 1983. The SSA checks were deposited over that 30 year period into an account which Susan Stock controlled. It was discovered that Stock’s mother died in 1983 but that Stock never notified SSA of her mother’s death and continued to receive and spend her deceased mother’s SSA benefits.
The case has been assigned to Senior U.S. District Court Judge William C. Caldwell. The plea agreement is subject to the Court’s approval. The investigation was conducted by the Social Security Administration’s Office of Inspector General. Prosecution of the case has been assigned to Assistant United States Attorney William A. Behe.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is imprisonment for 10 years, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public, and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Camden Man Sentenced for Crack Cocaine and Cocaine Distribution Offenses and Ordered to Forfeit Drug ProceedsRead the Press Release
MOBILE, AL-- The United States Attorney, Kenyen R. Brown announces that Roderick O=Neil McMillian was sentenced today to forty three months imprisonment and an eight year term of supervised release for possession with the intent to distribute crack cocaine in violation of Title 21 USC '841(a)(1). McMillian was also ordered to forfeit $1,511.00 in drug proceeds seized from him at the time of his arrest. He was also ordered to pay a $100.00 special assessment for the victims of crime. Under Title 21 USC '853, Congress has made it mandatory for federal drug defendants to forfeit the proceeds of their drug offenses as well as assets they use to facilitate the commission of such offenses.
The case was jointly investigated by the Drug Enforcement Administration and Alabama Alcoholic Beverage Control Bureau, Enforcement Division.
Brothers Sentenced for $2 Million FraudRead the Press Release
Earlier today, Amner A. Borukhov, also known as “Alex Amner Borukhov” and “Avner Borikhov,” was sentenced to 57 months of imprisonment to be followed by 3 years of supervised release following his plea of guilty to conspiracy to commit mail and wire fraud. Last month, his brother, Markiel Borukhov, also known as “Mark Borukhov,” was sentenced to 24 months of imprisonment to be followed by one year of supervised release following his plea guilty to conspiracy to commit mail and wire fraud. The sentences were imposed in federal court in Central Islip, New York by United States District Judge Sandra J. Feuerstein. As part of their sentences, Judge Feuerstein ordered Amner Borukhov and Markiel Borukhov to pay restitution and forfeit approximately $2.2 million and $622,000, respectively.
The sentences were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office.
“The defendants conned investors who were seeking to buy precious metals by using lies and deception to steal millions of their precious investment dollars,” stated United States Attorney Lynch. “When federal law enforcement began to close in on them, the defendants felt the heat and fled to Morocco, where they hid for over a year. But they soon learned what should serve as a lesson to all criminals: you can run, you can hide, but you cannot escape justice.” Ms. Lynch expressed her grateful appreciation to Moroccan authorities for Morocco’s cooperation and assistance with the extradition and successful prosecution of this case.
FBI Assistant Director-in-Charge Venizelos stated, “Instead of running a legitimate business, the defendants stole money by marketing bogus precious metals to unwitting investors. The long arm of the law stretched all the way to Morocco as the defendants found. This is the latest example of what happens when you steal and cheat from others to get ahead.”
According to court filings and facts presented during the court proceedings, between May 2009 and January 2011, the defendants induced approximately 60 investors to give them more than $2.2 million by promising to use their money to purchase palladium and other precious metals. The defendants, however, never gave those investors the metals that they promised to purchase, nor did they return any money to those individuals. Instead, the defendants used those funds to pay their personal expenses. In furtherance of their fraudulent scheme, the defendants used aliases and falsely told prospective investors that they were in a partnership with Jim Cramer, who hosts an investment program on CNBC called Mad Money.
In early 2011, the defendants learned that they were being investigated by the FBI. As a result, they bought one-way plane tickets to Casablanca, Morocco. They lived in Morocco for approximately 14 months while the U.S. Attorney’s Office, the FBI, and the Office of International Affairs worked with Moroccan authorities to locate, arrest, and return the defendants to the United States, so that they could be prosecuted for their crimes. In May 2012, Moroccan authorities located and arrested the defendants. Months later, the defendants were returned to the United States, where they have been in custody ever since. On October 9, 2013, the defendants pleaded guilty.
The government’s case was prosecuted by Assistant United States Attorney Christopher Caffarone. The Office of International Affairs in the Department of Justice’s Criminal Division provided assistance in this case.
This prosecution was the result of efforts by President Barack Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants. For more information on the task force, visit http://www.StopFraud.gov.
The Defendants:
AMNER A. BORUKHOV
Also known as “Alex Amner Borukhov” and “Avner Borikhov”
Age: 34
Residence: Great Neck, New York
MARKIEL BORUKHOV
Also known as “Mark Borukhov”
Age: 30
Residence: Brooklyn, New York
Bolingbrook Man Charged with Attempting to Illegally Export Thermal Imaging Camera to PakistanRead the Press Release
CHICAGO — A Bolingbrook man was indicted on federal charges alleging that he violated U.S. export laws by attempting to ship a thermal imaging camera from his company in Schaumburg to a company in Pakistan without obtaining a license from the U.S. Commerce Department, federal law enforcement officials announced today.
The case involves a FLIR HRC-U thermal imaging camera, which was on a Commerce Department list of controlled export goods for reasons of national security and regional stability. As a controlled material, a license was required from the Commerce Department’s Bureau of Industry and Security to export the camera to certain countries, including Pakistan.
The defendant, BILAL AHMED, 33, was charged with one count of violating the International Emergency Economic Powers Act (IEEPA) and one count of attempted smuggling of goods in violation of U.S. export regulations in a two-count indictment returned by a federal grand jury yesterday. Ahmed was initially charged in a criminal complaint and arrested on March 14, and he was subsequently released on a $100,000 secured bond.
No date has been set yet for Ahmed to be arraigned in U.S. District Court in Chicago.
According to the complaint affidavit and the indictment, Ahmed was the owner, president, and registered agent of Trexim Corp., which used the address of a virtual office in Schaumburg. Between November 2013 and February of this year, Ahmed corresponded via email with a company in California and negotiated the purchase of a FLIR HRC-U camera for approximately $102,000, which he paid with two checks in February. Ahmed took delivery of the camera on Feb. 27 at a commercial shipping store in Bolingbrook.
On March 7, Ahmed allegedly took the camera, packaged in two boxes, to a different commercial shipper located in Elk Grove Village and left the packages to be shipped to a company in Pakistan. The waybill included a handwritten note containing the letters “NLR,” meaning “no license required.” A search of U.S. State and Commerce Department databases showed there were no licenses applied for or obtained by Ahmed, Trexim or any other related individual or company names for the export of a FLIR HRC-U camera from the U.S. to Pakistan, the indictment alleges.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation, and Ronald B. Orzel, Special Agent-in-Charge of the U.S. Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, Chicago Field Office. The Justice Department’s National Security Division is providing assistance in the case.
Violating IEEPA carries a maximum penalty of 20 years in prison and a $1 million fine, while attempted smuggling of goods carries a maximum penalty of 10 years in prison and a $250,000 fine. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines. The government is being represented by Assistant U.S. Attorney Bethany Biesenthal.
An indictment contains merely charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Beckley Area Men Sentenced for Oxycodone CrimesRead the Press Release
BECKLEY, W.Va. – Robert Sears and Curtis Sears, both age 21, and both of Crab Orchard; and Stephen Hatcher, age 35, of Beckley, were sentenced today in Beckley, West Virginia, announced United States Attorney Booth Goodwin. Robert Sears was sentenced to 4 months home confinement with 100 hours community service; Curtis Sears was sentenced to 6 months imprisonment; and Stephen Hatcher was sentenced to 8 months imprisonment. All three defendants previously pleaded guilty in January 2014 to obtaining oxycodone by misrepresentation, fraud, forgery, deception and subterfuge. Each defendant obtained stolen blank prescription scripts, which they forged or which were forged by others, and obtained oxycodone at local Beckley pharmacies.
This case was investigated by the United States Drug Enforcement Administration. United States District Judge Irene C. Berger handed down today’s sentences.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The United States Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers.
Bankers and Attorney Convicted of Fraud, False Statements, and Making a False Claim Against the United StatesRead the Press Release
PANAMA CITY, FLORIDA– Late last night, a federal jury returned verdicts finding Donald Terry Dubose, a/k/a “Terry Dubose,” 66, of Panama City Beach, Florida, Elwood Ladon West, a/k/a “Woody West,” 40, of Monroeville, Alabama, and Frank Alfred Baker, 62, of Marianna, Florida, guilty of conspiring to commit wire fraud, making false statements, and filing false claims against the Federal Deposit Insurance Corporation. In addition, the three defendants were found guilty of seven counts of wire fraud, three counts of making false statements to the FDIC, and one count of aiding and abetting a false claim against the United States. The verdicts were handed down late last evening, following a trial that lasted almost three weeks.
The evidence at trial established that Coastal Community Investments (“Coastal”) was a bank holding company that owned Coastal Community Bank, based in Panama City Beach, Florida, and Bayside Savings Bank, based in Port St. Joe, Florida. Coastal Community Bank and Bayside Savings Bank both failed on July 30, 2010. Dubose was the Chairman and Chief Executive Officer of Coastal and the largest Coastal shareholder. West was the Chief Financial Officer of Coastal and a Coastal shareholder. Baker was an attorney for Coastal and was Coastal’s second largest shareholder.
The case involved a fraud committed against the Government relating to the FDIC’s Temporary Liquidity Guarantee Program (TLGP), which was created at the height of the nation’s financial crisis in October 2008. The purpose of the TLGP was to encourage banks to begin lending to one another again, and thereby, help to stabilize the economy. To accomplish this, the TLGP provided that the FDIC would guarantee a loan made by one financial institution (the “lender”) to another financial institution (the “borrower”) in an amount up to 125% of the borrower’s existing unsecured debt, thus assuring repayment to the lender by the borrower or, in the event of default, by the FDIC.
The evidence at trial showed that in October 2008, Coastal had a $3,000,000 secured loan with RBC Bank (USA), which was secured by 100% of the stock of Coastal Community Bank and Bayside Savings Bank (the “RBC Loan”). At that time, the RBC Loan was in default, thus giving RBC the ability to exercise its right to take the pledged stock that secured the loan and take over Coastal Community Bank and Bayside Savings Bank. Under pressure from RBC to repay this debt, the defendants falsely certified to the FDIC that the RBC Loan was unsecured, knowing for a fact that it was instead a secured loan, so that Coastal could get an FDIC-guaranteed loan under the TLGP.
The evidence at trial established that Coastal obtained a $3,750,000 loan from central Florida-based CenterState Bank. Based on the defendants’ misrepresentations, the CenterState Bank loan was guaranteed by the FDIC under the TLGP (the “TLGP Loan”), and as provided by the program, represented 125% of the RBC Loan. Coastal used the proceeds of the TLGP Loan to repay the RBC Loan.
In June 2010, Coastal defaulted on the TLGP Loan, and on August 6, 2010, CenterState Bank filed a claim with the FDIC for payment of the full amount due on the TLGP Loan, plus interest. The FDIC paid CenterState’s claim on August 13, 2010, by wiring $3,805,833.34 in principal and interest from the FDIC to CenterState.
United States Attorney Marsh said, “These defendants – bank officers and a bank attorney – took advantage of the Temporary Liquidity Guarantee Program, which was designed to help the country avoid financial collapse, and instead used the program to enrich themselves. Such fraud committed by bank insiders against programs designed to help our citizens will not be tolerated. Not only is such conduct a breach of trust, it is harmful to our communities and our nation. My office will continue to investigate and prosecute any individual who would harm our banking system, our financial institutions, and our national economy.”
Matt Alessandrino, Assistant Inspector General for Investigations, FDIC, said, “The Federal Deposit Insurance Corporation Office of Inspector General is pleased to have joined the U.S. Attorney's Office and our law enforcement colleagues in investigating the fraud that led to these convictions today. It is particularly troubling to the FDIC OIG when bank insiders and other professionals affiliated with the bank violate the public trust and engage in activities that cause losses to the Deposit Insurance Fund or harm FDIC programs designed to restore the strength of the banking system. We are committed in our efforts to maintain integrity in our nation's banks.”
The defendants are facing a maximum of 30 years’ imprisonment on each count of conspiracy to commit wire fraud, wire fraud, and making false statements to the FDIC. Each defendant faces a maximum of five years’ imprisonment for causing the submission of CenterState Bank’s false claim against the United States.
This case was investigated by the Federal Reserve – Office of the Inspector General, the Federal Bureau of Investigation, the FDIC, and the Office of the Special Inspector General for the Troubled Asset Relief Program.
The case was prosecuted by Assistant U.S. Attorney Gayle Littleton and Assistant U.S. Attorney Ryan Love, with the invaluable assistance of Federal Reserve – Office of the Inspector General Special Agent Amy Whitcomb.Bank Employee Sentenced for Embezzling from Senior Citizens’ AccountsRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
DAYTON, OHIO – Diane Elizabeth Niehaus, 40, of Sugarcreek Township, Ohio was sentenced in U.S. District Court to serve 60 months in prison followed by three years of supervised release for embezzling from the accounts of elderly customers of the bank where she worked as a manager. She was also ordered to pay restitution to the victims of her embezzlement and to the IRS.
Carter M. Stewart, U.S. Attorney for the Southern District of Ohio, Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation, and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS) announced the sentence handed down today by U.S. District Judge Timothy S. Black.
According to court documents, Niehaus managed the Union Savings Bank branch in Centerville between 2007 and 2010. Using her position with the bank, she methodically targeted and stole hundreds of thousands of dollars from her elderly customers, many of whom she knew to suffer from cognitive conditions such as dementia and Alzheimer’s disease.
To prevent detection of her embezzlement, she used a host of deceptive tactics including creating fictitious gift letters and fraudulent powers of attorney, and engaging in complicated and layered financial transactions to conceal her theft. Niehaus frequently converted the money into cashiers’ checks or official checks that she then negotiated or caused to be negotiated at USB or other locations. Niehaus illegally earned thousands of dollars through this embezzlement scheme, and she failed to report this fraudulently-obtained income on her federal income tax returns.
“Ms. Niehaus has been and remains an economic danger to this community,” Assistant U.S. Attorney Brent Tabacchi told the court. “Far from having no financial impact on her victims, this defendant’s actions have cost her former employer hundreds of thousands of dollars for which it has yet to receive complete restitution.”
Niehaus pleaded guilty on September 19, 2013 to one count each of embezzlement, money laundering, and filing a false income tax return.
Judge Black sentenced her to pay restitution to the bank, which had reimbursed the customers for their losses, and to the IRS. The exact amount will be determined in the next 90 days.
"Embezzlement and fraud cases can take time to unravel due to the complex financial transactions," said Kathy A. Enstrom, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office. "As we often see, the victims are not only the taxpayers, but also the individuals and entities who suffer the financial harm."
U.S. Attorney Stewart commended the cooperative investigation by special agents of the FBI and IRS, as well as Assistant U.S. Attorney Brent Tabacchi, who is prosecuting the case. U.S. Attorney Stewart also acknowledged the cooperation of Union Savings Bank in the investigation.
Bahamian Man Charged in Mail and Wire Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Paula Reid, Special Agent in Charge, U.S. Secret Service (USSS), and Ronald J. Verrochio, Inspector in Charge, U.S. Postal Inspection Service (USPIS), announce the return of a 23-count indictment charging Rudolph Kermit King, a/k/a “Rudy,” 46, of Nassau, the Bahamas, with mail fraud, wire fraud, and aggravated identity theft in a scheme to defraud.
According to the indictment, King created fictitious corporations that he then used to create merchant accounts with credit card processors. Rudolph Kermit King would inflate the amount of funds within the merchant account by charging unauthorized access devices. These funds would then be deposited to a small business checking account under King’s control, from which he withdrew funds. Finally, King used unauthorized access devices to purchase goods and services to fund his lifestyle.
If convicted, King faces a statutory maximum penalty of 20 years in prison for each count of mail fraud and wire fraud, followed by three years of supervised release, a fine of up to $250,000 and restitution, and a consecutive two years in prison for each count of aggravated identity theft.
Mr. Ferrer commended the investigative efforts of USSS and USPIS. The case is being prosecuted by Assistant U.S. Attorney Alexandra Hui.
An indictment is only an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.