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7 March 2014
East St. Louis Man Convicted of Selling Crack CocaineRead the Press Release
Follow @SDILNewsThe United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today that on Thursday, March 6, 2014, a federal jury found Frederick C. Addison guilty of two felonies relating to the sale of crack cocaine.
Addison, 32, of East St. Louis, was convicted following a three day jury trial in United States District Court in East St. Louis, IL. The jury found Addison guilty of distributing crack cocaine and possessing crack cocaine with the intent to distribute it.
According to evidence presented at his trial, Addison sold crack from a house in the 800 block of North 32nd Street in East St. Louis throughout the entire day on April 3, 2012. Police officers surreptitiously filmed Addison selling crack cocaine to multiple customers. When Addison and another man were arrested, police recovered approximately 17 grams of crack cocaine from an abandoned house where Addison and his associate had hidden it. The crack had a street value of about $12,000, according to police experts who testified at trial.
Addison is scheduled to be sentenced on June 27, 2014, in United States District Court in East St. Louis. He faces a possible maximum sentence of 20 years in prison. Addison has been confined since his arrest on April 3, 2012.
The investigation which resulted in Addison’s arrest and conviction was conducted by police officers assigned to the Metropolitan Enforcement Group of Southwestern Illinois (MEGSI). The case resulted from the efforts of the WAVE (Working Against Violent Elements) Task Force, which focuses its efforts on combating violent crime in East St. Louis, Washington Park, and surrounding communities. The WAVE Task Force receives financial support through the Department of Justice’s Project Safe Neighborhoods (PSN) initiative, a nationwide federal program which endeavors to address gun-related violence.
The case was prosecuted by Special Assistant United States Attorney Neal C. Hong and Assistant United States Attorney Robert L. Garrison.
Dutchess County Orthopedic Surgeon SentencedIn White Plains Federal Court to 54 Months ForMultimillion Dollar Health Care Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that DR. SPYROS PANOS, an orthopedic surgeon, was sentenced today in White Plains federal court before U.S. District Judge Nelson S. Roman to serve 54 months in prison for operating a long-running health care fraud scheme in which PANOS defrauded Medicare, the New York State Insurance Fund, and numerous private health insurance providers (the “Health Insurance Providers”) out of over $2.5 million by systematically lying about the nature and scope of the surgical procedures that he performed. In addition, PANOS was ordered to forfeit $5 million. He was ordered to surrender to start serving his prison term in 30 days.
Manhattan U.S. Attorney Preet Bharara said: “Dr. Panos’s fraud was extensive, costing millions of dollars to federal, state, and private health insurance providers when he billed for thousands of surgical procedures that he falsely described or did not perform at all.”
According to the Information and other documents filed in this case:
PANOS was a board certified orthopedic surgeon licensed to practice medicine in the State of New York who was part a medical group with offices in Dutchess County, New York, (the “Medical Group”) and performed orthopedic surgical procedures (“Surgical Procedures”) at hospitals in Poughkeepsie, New York. From at least 2006 through July 2011, PANOS maintained a high-volume orthopedic practice, which enabled him to carry out his fraud scheme on a large scale. Panos performed thousands of Surgical Procedures, and often as many as 20 or more in a single day, for which he and the Medical Group submitted claims in excess of $35 million to Health Insurance Providers. Health Insurance Providers paid the Medical Group in excess of $13 million on these claims.
To receive payments for Surgical Procedures from the Health Insurance Providers, PANOS was required to submit, and caused the Medical Group to submit, information to the Health Insurance Providers regarding the nature and details of the Surgical Procedures. With respect to many of the Surgical Procedures he performed, PANOS furnished, and caused the Medical Group to furnish, false information to Health Insurance Providers that resulted in the Health Insurance Providers paying the Medical Group at least $2.5 million more than PANOS and the Medical Group were entitled to receive based on the true nature and details of the Surgical Procedures PANOS performed. Among PANOS’s false representations were the following:
a. PANOS claimed he performed open surgeries, when in fact PANOS performed the surgeries arthroscopically;
b. PANOS claimed he used certain techniques and procedures during the course of the Surgical Procedures, when in fact PANOS did not, either because they were not medically necessary or because PANOS used other techniques and procedures that would have resulted in lower payments, if any, from the Health Insurance Providers; and
c. PANOS removed body tissue, known in the medical field as loose bodies, in excess of certain size criteria, when in fact PANOS either removed no loose bodies or removed loose bodies that were smaller than the thresholds set by the Health Insurance Providers for payment.
PANOS, was compensated handsomely -- during the years 2007 through 2011, he was paid over $7.5 million by the Medical Group, a number that was inflated as a result of his fraud scheme.
Beginning in or about December 2010, PANOS attempted to conceal his scheme by, among other things, falsely representing to the Medical Group that the Fraudulent Claims were the result of clerical errors.
PANOS, 45, of Hopewell Junction, New York, also agreed to the entry of a $5 million order of forfeiture against him As a result of his conviction, PANOS is subject to mandatory exclusion from participation in any federal health care program, including Medicare and Medicaid. Following the uncovering of the scheme, Panos surrendered his New York State medical license. Judge Roman ordered PANOS to serve two years of supervised release upon completion of his prison term.
Mr. Bharara praised the work of the United States Postal Inspection Service, the United States Department of Health and Human Services – Office of Inspector General, and the Federal Bureau of Investigation, and thanked the United States Department of Health and Human Services, Office of Counsel to the Inspector General, the New York State Insurance Fund, the New York Workers’ Compensation Board Office of the Fraud Inspector General, and the National Insurance Crime Bureau for their extraordinary assistance in the investigation.
This case is being handled by the White Plains Division. Assistant United States Attorneys Lee Renzin and Daniel Filor are in charge of the prosecution.
David Lawrence Honored as Indian Country Officer of the YearRead the Press Release
United States Attorney Brendan V. Johnson announced that David Lawrence has been named the 2013 Indian Country Officer of the Year by the International Association of Chiefs of Police. Lawrence is Chief of Police with the Bureau of Indian Affairs on the Standing Rock Sioux Reservation.
Chief Lawrence has been working in Indian country for approximately 18 years, spending much of that time working complex cases involving murder, kidnapping, violent sexual assaults, and child abuse. Additionally, for several years, Chief Lawrence was the sole criminal investigator for the Standing Rock Sioux Reservation during a time when there was a significant increase in teen suicides. He went to the tragic scenes and dealt with the evidence of the death, but also compassionately worked with the devastated family members.
The Standing Rock reservation covers both South and North Dakota, which necessitates that Lawrence work with the U.S. Attorney’s offices in both states on major crime cases.
“Along with U.S. Attorney Tim Purdon from the District of North Dakota, it was my privilege to nominate David Lawrence for the 2013 Indian Country Officer of the Year,” said Johnson. “I have the utmost respect for him, and the judgment and commitment he takes to work every day. As federal prosecutors, our offices rely on the investigative skills of our partner agencies to help ensure public safety and deliver justice. Chief Lawrence is top-notch in his field, and we’re fortunate to have him as a law enforcement partner on Standing Rock.”
In a recent case, Chief Lawrence courageously risked his life to try and save a disabled young adult from a residential house fire in McLaughlin, South Dakota. Chief Lawrence was in McLaughlin on other law enforcement duties, when he monitored a call for assistance at a house fire. He was one of the first responders on the scene, and learned there was a disabled male in the house, which was engulfed in flames and smoke. In a heroic attempt to save the young man, Chief Lawrence broke the window to the room where he was thought to be located. Although he could not locate the victim on the first attempt and had to retreat the house due to the smoke, Chief Lawrence made a second entry into the smoke-filled bedroom and removed the man from the burning residence. Sadly, the victim subsequently died from smoke inhalation.
In addition, Chief Lawrence has been an important teacher to new special agents and Assistant U.S. Attorneys, helping them to become culturally sensitive to the art of investigating major crimes in Indian country.
The Indian Country Officer of the Year Award provides international recognition of police officers that demonstrate exceptional valor in service to the people of Indian country. Chief Lawrence was recently bestowed the honor by Darren Cruzan, Director of the Bureau of Indian Affairs Office of Justice Services, and Joseph LaPorte, Chairman of the IACP Indian Country Law Enforcement Section, during a banquet at the Las Vegas Paiute Tribe Resort in connection with the Indian Country Law Enforcement Section’s Mid-year Meeting.
Couple Sentenced in U.S. District CourtRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that Defendant John A. Cruz, age 47, and Defendant Mae Tedtaotao Cruz, age 45, husband and wife, and residents of Yona, were sentenced on March 6, 2014, by Chief Judge Frances Tydingco-Gatewood, in the District Court of Guam. John A. Cruz received 78 months for his conviction of conspiracy to distribute more than 50 grams of methamphetamine and an additional five years for using, carrying or possessing a firearm during a drug trafficking crime. The five years are consecutive to the conspiracy charge. John A. Cruz was assessed a $200 special assessment fee, 400 hours community service and five years supervised release. Mae Tedtaitao Cruz was sentenced to 27 months imprisonment on the conspiracy charge, 400 hours community service, a $100 special assessment fee and five years supervised release.
On October 27, 2011, postal inspectors intercepted an Express Mail package and searched it pursuant to a federal search warrant; the package contained 86 grams of 91.1% pure ice. Agents secured a warrant to search the defendants’ residence, where they were arrested. Agents seized, among other things, $38,000 cash, five firearms (all registered); a Toyota Forerunner, an FJ Cruiser and two all-terrain vehicles. They later seized a Lexus SUV. All these items have been forfeited.This case was investigated by special agents from the U.S. Postal Inspection Service (USPIS); Drug Enforcement Administration (DEA); Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); Department of Homeland Security/Homeland Security Investigations (HSI); and officers from the Guam Police Department and Guam Customs and Quarantine Agency. The case was prosecuted by Assistant U.S. Attorney Clyde Lemons.
Co-Leader of Illegal Drug Company Gallant Pharma Sentenced to 3 YearsRead the Press Release
Company smuggled and sold over $12 million in non-FDA-approved chemotherapy drugs and injectable cosmetic drugs and devices
ALEXANDRIA, Va. – Talib Khan, 43, of Montreal, Quebec and Barbados, co-founder of Gallant Pharma International Inc., an unlicensed wholesale drug distributor headquartered in Arlington, Va., was sentenced today to 3 years in prison, 2 years of supervised release, and $3.4 million in forfeiture and restitution to victims.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; Antoinette V. Henry, Special Agent in Charge of the Food and Drug Administration’s (FDA) Office of Criminal Investigations; Gary Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; Scot R. Rittenberg, Acting Special Agent in Charge of U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), Washington; and M. Douglas Scott, Arlington County Chief of Police, made the announcement after sentencing by United States District Judge Claude M. Hilton.
On Oct. 15, 2013, Khan pleaded guilty to conspiracy and sale of misbranded drugs. According to court documents, between August 2009 and August 2013, Gallant Pharma smuggled into the United States and sold more than $12.4 million in non-FDA-approved chemotherapy drugs and injectable cosmetic drugs and devices, generating profits of $3.4 million. Many of these drugs were subject to strict temperature controls to protect drug potency. Gallant Pharma shipped and received such drugs with ice packs, not dry ice used by legitimate distributors, and on at least one occasion, a shipment containing such drugs took more than two weeks to arrive in Virginia from overseas during a July 2012 heat wave.
Many drugs sold by Gallant Pharma also were required to carry a FDA “black box” warning, which indicates that a drug carries a significant risk of serious or life-threatening adverse effects. The versions sold by Gallant Pharma did not meet this or other FDA labeling requirements.
Also sentenced today was Gallant Pharma sales representative Harvey Whitehead, 68, of Cadillac, Michigan. Whitehead, was sentenced to 2 years of probation, to include 6 months of home confinement, following his Oct. 3, 2013 guilty pleas to unlicensed wholesale prescription drug distribution and sale of misbranded drugs. Whitehead also agreed to pay $36,795.85 in restitution to victims.
Nine additional co-defendants, including co-founder Syed “Farhan” Huda, 38, of Arlington, Va., previously pleaded guilty, and eight are awaiting sentencing. A jury trial is scheduled for March 31, 2014, for alleged co-conspirators Anoushirvan Sarraf, 48, and Eva Montejo Pritchard, 48, both of Rockville, Md. Sarraf, the owner of Aphrodite Skin Care Clinic in McLean, Va., and Pritchard, the office manager, are alleged to have knowingly received illegal shipments intended for Gallant Pharma, in exchange for a discounted price on non-FDA-approved drugs and devices that they used on Aphrodite patients without the patients’ knowledge or consent.
This case was investigated by FDA’s Office of Criminal Investigations, the Drug Enforcement Agency’s Group 33 Diversion Task Force, HSI Washington and the U.S. Postal Inspection Service, with assistance from the Arlington County Police Department. Assistant United States Attorneys Lindsay Kelly, Maya Song and Jay Prabhu are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Chicago Woman Convicted of Money Laundering, Making False Statements to Law Enforcement and Federal Grand JuryRead the Press Release
Springfield, Ill. – A jury in Springfield, Ill., deliberated for less than two hours this evening before returning guilty verdicts on all counts against Jeri L. Wright, 48, of Hazel Crest, Ill. Wright was convicted of money laundering, making false statements to federal law enforcement officers, and giving false testimony before a grand jury, related to an ongoing investigation of fraudulent use of Illinois Department of Commerce and Economic Opportunity grant funds. Sentencing is scheduled on July 7, 2014, before U.S. District Judge Sue E. Myerscough.
During the trial, which began on Mar. 4, the government presented evidence that Wright participated in a fraud scheme led by her friend, former Country Club Hills, Ill., police chief Regina Evans, and then repeatedly lied about her involvement to law enforcement and a federal grand jury.Evans is scheduled for sentencing on Mar. 24, 2014, after pleading guilty to wire fraud, money laundering, witness tampering, and obstruction of justice, related to a $1.25 million state grant awarded in 2009 to We Are Our Brother’s Keeper, a not-for-profit program that Evans owned with her husband, Ronald W. Evans, Jr. Ronald Evans has also pleaded guilty to the fraud scheme and is scheduled to be sentenced on Apr. 21, 2014. The grant agreement was purportedly to provide bricklaying and electrical pre-apprenticeship training and GED preparation, at the Regal Theater, another entity owned by the Evanses. In fact, little, if any, of the training provided in the grant agreement was ever completed.
“Jeri Wright chose to participate in the fraud, chose to receive and launder a portion of the proceeds of the fraud, and chose to repeatedly lie to law enforcement and a federal grand jury,” said Jim Lewis, U.S. Attorney for the Central District of Illinois. “If you take and misuse government money, and then lie about it, you will be held accountable in a court of law.”
U.S. Attorney Lewis further expressed his appreciation to the federal law enforcement officers assigned and the agencies who support the Central District of Illinois U.S. Attorney’s Office’s Public Corruption Task Force: Tony Gomez, Postal Inspector in Charge, U.S. Postal Inspection Service, Chicago Division; James Lee, Special Agent in Charge, Internal Revenue Service, Criminal Investigation, Chicago Field Office; and Jim Burns, Inspector General, Illinois Secretary of State Office of Inspector General. Assistant U.S. Attorney Timothy A. Bass is prosecuting the case on behalf of the U.S. Attorney’s Office for the Central District of Illinois.
At sentencing, the maximum statutory penalty for each of the counts against Wright is money laundering (two counts), up to 20 years in prison, and a fine of up to $500,000 or twice the value of the transactions, whichever is greater; and for making false statements to federal law enforcement officers (two counts) and giving false testimony before a grand jury (seven counts), the statutory penalty is up to five years in prison.
Canadian Man Sentenced for Bank FraudRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that Ali Haddad, 31, of Montreal, Quebec, Canada, who was convicted of bank fraud, was sentenced to 48 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Russell T. Ippolito, Jr., who handled the prosecution, stated that Haddad, a citizen and resident of Canada, opened a business bank account at an M&T Bank branch in Buffalo in the name of Symcore, Inc. Between January 15, 2009, and February 19, 2009, the defendant deposited false and fraudulent pre-authorized debits (APADS@) into the account. The PADS deposited to the Symcore account purportedly represented money owed to Symcore by the payers listed on the PADS. M&T Bank relied upon the deposited PADS to calculate the daily cash balance of funds in the Symcore business checking account.
On February 19, 2009, the defendant withdrew money from the Symcore account by electronically transmitting funds from the account by means of wire communication to bank accounts in Canada. Haddad caused two separate wire transactions to transmit funds from the Symcore account in the following amounts: $10,000, and $18,000 totaling $28,000. This money represented funds from the deposit of the false and fraudulent PADS.
Between December 24, 2008, and January 26, 2009, the defendant committed similar fraudulent acts against Bank of America. However, Bank of America discovered the fraud before the defendant was able to unlawfully transmit funds from the Bank of America account.The total loss to M&T Bank and Bank of America was $28,000.
The sentencing is the result of an investigation by the United States Secret Service, under the direction of Special Agent in Charge Tracy Gast.Brookings Man Sentenced in Firearm CaseRead the Press Release
United States Attorney Brendan V. Johnson announced that a Brookings, South Dakota, man convicted of Possession of a Firearm by a Convicted Felon was sentenced on March 6, 2014, by U.S. District Judge Karen E. Schreier.
Larry Steven Jordan, Jr., age 46, was sentenced to time served and put on supervised release for two years with the first seven months on home confinement. He was fined $500 and required to forfeit two firearms and ammunition.
Jordan was indicted for two counts of Possession of a Firearm by a Convicted Felon by a federal grand jury on May 8, 2013. He pled guilty to one count on December 16, 2013, and the other count was dismissed.
Jordan was found in possession of a rifle in Brookings on February 28, 2011.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives. Assistant U.S. Attorney John E. Haak prosecuted the case.
Ashland Couple Convicted of Labor Trafficking ConspiracyRead the Press Release
A federal jury convicted an Ashland couple of engaging in a labor trafficking conspiracy and other crimes related to them holding woman with cognitive disabilities and her child against their will and forcing the woman to perform manual labor for them, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.
Jordie L. Callahan, 27 and Jessica L. Hunt, 32, were convicted following a three-week trial before U.S. District Judge Benita Y. Pearson. Callahan and Hunt were both convicted on one count each of conspiracy to violate laws; forced labor and acquiring a controlled substance by deception.
They are scheduled to be sentenced in July.
“These defendants inflicted unspeakable cruelty upon this mother and her child,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “This case provides another stark reminder that human trafficking takes place all around us, and that we need to be better neighbors to one another.”
“We are pleased with the guilty verdict delivered today for the incomprehensible treatment and involuntary servitude of another human being and her small child,” Anthony said. “The FBI will continue to partner with other law enforcement agencies to aggressively investigate and bring to justice those individuals that force others into unlawful labor or sex practices.”
Dezerah L. McGuire (formerly Silsby), 32, and Daniel J. Brown, 34, both of Ashland, previously pleaded guilty to crimes related to the conspiracy. Both are scheduled to be sentenced later this month.
Callahan and Hunt used a combination of violence, threats, sexual assaults, humiliation, deprivation and monitoring to establish and continue a pattern of domination and control over their victims, identified only as S.E. and B.E., according to the court documents and trial testimony.
Their tactics included beating S.E., threats of beatings to S.E. and B.E., taunting and threatening the victims with pit bulls and snakes, causing the victims to sleep in unsafe and unsanitary conditions, restricting B.E. and S.E.’s access to the bathroom, preventing them from eating regular and suitable meals and forcing S.E. to eat dog food and crawl on the floor while wearing a dog collar, according to the court documents and trial testimony.
According to court documents and trail testimony:
Callahan pointed a firearm at S.E.’s head and threatened to kill her if she did not perform the labor and services he and other conspirators commanded. Callahan also forced S.E. on multiple occasions to engage in sex acts with him and threatened that he and Hunt would kill S.E. if she told anyone about the forced sexual acts.
The conspiracy between Callahan, Hunt, McGuire and Brown took place between August 2010 and October 2012. The object of the conspiracy included holding S.E. in a condition of forced labor and involuntary servitude and intentionally causing painful injuries to S.E. so they could use the narcotic pain medications she was prescribed to satisfy their personal drug craving.
Callahan and Hunt recruited S.E. and B.E. to live with them in their two-bedroom apartment in Ashland, knowing that S.E. has a cognitive disability and that S.E. and B.E. received monthly public assistance payments.
In August 2011, McGuire, at the direction of Callahan and Hunt, smashed S.E.’s hand with a rock with such force that S.E. needed to go to the hospital emergency room. Callahan, Hunt and McGuire then forced S.E. to give them the narcotic pain pills and prescription for narcotic pain pills she obtained after being treated at the emergency room.
In December 2011, Callahan and Hunt injured S.E.’s back with such force that she needed medical treatment. Again, Callahan and Hunt forced S.E. to give them the narcotic pain pills and prescription for narcotic pain pills she obtained after being treated.
In March 2012, Callahan kicked S.E. in the hip with such force that she needed medical treatment. Callahan and Hunt forced S.E. to give them the narcotic pain pills and prescription for narcotic pain pills she obtained after being treated.
On multiple occasions between August 2010 and October 2012, Callahan and Hunt threatened S.E. and B.E. with serious physical harm, including death, if S.E. did not clean up the apartment, care for their numerous pit bull dogs, snakes and other reptiles, purchase items at the store and perform other labor and services ordered by the conspirators.
Callahan and Hunt used a video camera to monitor S.E. and B.E.’s activities and conversations in the apartment. They often forced S.E. to walk to the store to buy groceries, cigarettes, dog food and other items for Callahan, Hunt and Hunt’s four sons and to pay for these purchases with her public assistance card. They allotted S.E. only a brief time period to complete the shopping and warned her she was not allowed to speak with anyone while she was out. They frequently required B.E. to remain with them at the apartment while S.E. was out and threatened physical harm to B.E. and S.E. if S.E. broke any of their rules.
Callahan and Hunt also threatened to contact Ashland County Job and Family Services and have B.E. taken away if S.E. purchased any items at the store other than those they ordered or if she told anyone about their unlawful conduct.
In June 2011, after S.E. and B.E. had attempted to flee the apartment, Callahan and Hunt ordered Brown and McGuire to find S.E. and B.E. and bring them back to the apartment. Brown and McGuire lured S.E. and B.E. into their vehicle by promising to take them to Dairy Queen, only to deposit them afterwards back at the apartment.
On multiple occasions, Callahan and Brown locked S.E. and B.E. in a room with a window that was nailed shut and a door that had been locked from the outside.
In October 2011, Callahan and Hunt forced S.E. to hit her child while they recorded a video, and threatened to inflict much greater physical harm on both S.E. and B.E. if S.E. did not comply.
One month later, Callahan and Hunt again forced S.E. to strike B.E. while they captured a video recording of the staged incident on Callahan’s cell phone. Callahan and Hunt repeatedly threatened have B.E. taken away by showing the videos to authorities in order to secure S.E.’s compliance to the conspirators’ commands.
The case was prosecuted by Assistant U.S. Attorneys Chelsea Rice and Thomas E. Getz following an investigation by the FBI and Ashland Police Department, with assistance from the Ashland County Prosecutor’s Office.
Another New Yorker Pleads Guilty to Federal Marijuana Trafficking ChargesRead the Press Release
ALBUQUERQUE – Eric Bernard Harris, 46, of St. Albans, N.Y., pleaded guilty this afternoon to a conspiracy to distribute marijuana charge. The plea was entered without the benefit of a plea agreement. Eric Harris’s co-defendant, Gary Anthony Harris, 50, of Carle Place, N.Y., entered a guilty plea to a marijuana trafficking charge earlier this week.
Eric Harris and Gary Harris were charged by criminal complaint on Aug. 8, 2013, with conspiracy to distribute marijuana. On Aug. 13, 2013, Homeland Security Investigations (HSI) agents arrested Eric Harris in New York, N.Y., and Gary Harris in Carle Place, N.Y. The two men subsequently appeared in Las Cruces federal court to face the charges against them. On Nov. 13, 2013, they were indicted and charged with conspiracy and possession of marijuana with intent to distribute.
According to court filings, Carl Francis Carter, 60, of Deptford, N.J., was arrested on July 27, 2011, after an officer of the New Mexico Department of Public Safety Motor Transportation Division found 527 kilograms (1163 pounds) of marijuana concealed in Carter’s commercial vehicle during a routine inspection at a checkpoint on Interstate 10 in Hidalgo County, N.M. Subsequent investigation by HSI revealed that Carter had been in communication with Gary Harris on the night of his arrest, and that Eric Harris had attempted to contact Carter the morning after his arrest. Investigation also revealed that Eric Harris and Gary Harris traveled from New York to Phoenix, Ariz., on July 17, 2011, allegedly to facilitate the purchase of the marijuana and to transport it from Tucson, Ariz., to New York. Eric Harris and Gary Harris traveled back to New York on July 27, 2011, following Carter’s arrest.
Today, Eric Harris pleaded guilty to both counts of the Indictment charging him with conspiracy to distribute marijuana and possession of marijuana with intent to distribute, and admitted conspiring with Gary Harris, Carter and others to distribute the 527 kilograms of marijuana found in Carter’s commercial vehicle.On March 5, 2014, Gary Harris pleaded guilty to possession of marijuana with intent to distribute under a plea agreement with the U.S. Attorney’s Office. In entering his guilty plea, Gary Harris acknowledged possession of 300 pounds of 527 kilograms of marijuana that was found in Carter’s commercial vehicle on June 27, 2011. He also admitted that Eric Harris and he traveled from New York to Arizona to facilitate the purchase and transportation of the marijuana from Arizona to New York. As part of his plea agreement, Gary Harris agreed to forfeit $52,882.97 in drug proceeds which were seized from two bank accounts and a safe deposit box by HSI pursuant to seizure warrants.
Carter pled guilty to a marijuana trafficking charge on Jan. 31, 2012, and admitted knowingly possessing 527 kilograms of marijuana on July 27, 2011. Carter admitted knowing that the marijuana was concealed in his commercial vehicle and that he expected to be paid for delivering the marijuana for further distribution.
Sentencing hearings for Eric Harris, Gary Harris and Carter have yet to be scheduled. At sentencing, each man faces a sentence of not less than five years and not more than 40 years in prison.
This case was investigated by the Deming office of HSI with assistance from the New Mexico Department of Public Safety Motor Transportation Division, and is being prosecuted by Supervisory Assistant U.S. Attorney Randy M. Castellano of the U.S. Attorney’s Las Cruces Branch Office.
Anne Arundel County Cocaine Dealer Exiled to over 13 Years in PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell, III sentenced Daryell M. Rexrode, age 56, of Pasadena, Maryland, today to 160 months in prison followed by five years of supervised release for conspiracy to distribute and possess with intent to distribute cocaine.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Anne Arundel County Police Chief Kevin Davis; and Anne Arundel County State’s Attorney Anne Colt Leitess.
According to his plea agreement, from November 2012 through July 24, 2013, Rexrode conspired with Paul Rodney Cain and others to distribute cocaine. On November 16, 2012, Rexrode was arrested in Baltimore upon arriving to accept a controlled delivery of a kilogram of cocaine that he intended to split with Cain. Rexrode had an additional 344 grams of cocaine and more than 700 grams of methamphetamine in the trunk of his car.
In May 2013, law enforcement initiated wiretaps on two cell phones belonging to Cain and learned that Rexrode and Cain were building their inventory of cocaine. For example, on May 23 law enforcement overheard Rexrode and Cain discussed purchasing cocaine from multiple sources of supply. During this call, Cain told Rexrode that he had arranged to purchase a large quantity of cocaine from an individual whom law enforcement subsequently identified as Allan Ferdock. Law enforcement arrested Ferdock on May 24 after witnessing Ferdock purchase a kilogram of cocaine which he intended to re-sell to Cain. Law enforcement seized the cocaine.
Following Ferdock’s arrest, law enforcement intercepted many calls in which Rexrode and Cain, who did not believe that law enforcement had seized the cocaine, discuss confronting Ferdock about the cocaine that Ferdock had agreed to deliver. The conspirators devised a plan to have Cain take Rexrode’s brother to Ferdock’s residence to confront Ferdock.
On May 26, 2013, law enforcement intercepted a call in which Cain informed Rexrode that he had just left Rexrode’s brother at Ferdock’s home. In the early morning hours of the next day, law enforcement arrested Rexrode’s brother on Ferdock’s property. At the time of his arrest, Rexrode’s brother was wearing latex gloves and carrying a mallet, a knife and a roll of duct tape.
Daryell Rexrode conspired to distribute more than five kilograms of cocaine.
Paul Rodney Cain, age 48, and Allan Clay Ferdock, age 56, both of Pasadena, previously pleaded guilty to their roles in the conspiracy and are scheduled to be sentenced on May 8 and April 3, 2014, respectively.
United States Attorney Rod J. Rosenstein commended the DEA, Anne Arundel Police Department and Anne Arundel County State’s Attorney=s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Peter J. Martinez and Christopher J. Romano, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Ana Alliegro Charged with Violation of the Federal Election Campaign ActRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Ana Alliegro, 44, of Granada, Nicaragua, was arrested and brought back to the United States from Nicaragua, having been previously indicted for having violated the Federal Election Campaign Act in connection with the Democratic Party primary election for Florida’s 26th Congressional District. Alliegro’s initial appearance is scheduled for March 10, 2014 at 1:30 p.m. before U.S. Magistrate Judge Patrick White.
The indictment charges Alliegro with engaging in a conspiracy to make false statements to the Federal Election Commission and to violate the contribution limits of the Federal Election Campaign Act (Count 1); making a false statement (Count 2); and making illegal campaign contributions (Counts 3 & 4). If convicted, Alliegro faces a maximum term of up to five years in prison on each count and a fine of up to $250,000 on each count.
Mr. Ferrer commended the investigative efforts of the FBI’s Miami Area Corruption Task Force, the Legal Attaché Panama City, Panama and Diplomatic Security Service. The case is being prosecuted by Senior Litigation Counsel Thomas J. Mulvihill.
An Indictment is only an accusation and a defendant is presumed innocent until proven guilty.
Attachment:
Indictment (PDF)
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Albuquerque Man Pleads Guilty to Armed Bank Robbery SpreeRead the Press Release
ALBUQUERQUE – James Charles Mollohan, 36, of Albuquerque, N.M., pleaded guilty today to four armed bank robbery charges and to using a firearm in relation to a crime of violence. Under the terms of his plea agreement, Mollohan will be sentenced to a prison term within the range of 322 months (26.83 years) to 387 months (32.25 years) followed by a term of supervised release to be determined by the court.
The guilty plea was announced by Acting U.S. Attorney Steven C. Yarbrough, Special Agent in Charge Carol K.O. Lee of the FBI’s Albuquerque Division, and Chief Gorden E. Eden, Jr., of the Albuquerque Police Department.
Mollohan was arrested on Feb. 1, 2013, on a criminal complaint charging him with the armed robbery of the New Mexico Educators Federal Credit Union branch located at 3205 Coors Blvd. NW in Albuquerque. According to court filings, Mollohan approached a bank teller, pointed a handgun at the teller, and demanded money. As the teller opened the cash drawer in response to Mollohan’s demand, the teller surreptitiously activated an alarm before handing cash to Mollohan. Mollohan was arrested in the vicinity of the bank shortly thereafter by officers of the Albuquerque Police Department who responded to a radio transmission alerting them of the bank robbery. Mollohan was in possession of a loaded semi-automatic handgun and a significant amount of cash when he was arrested.
During today’s hearing, Mollohan pled guilty to a five-count felony information charging him with four counts of armed bank robbery and possession of a firearm in relation to a crime of violence. In entering his guilty plea, Mollohan admitted robbing at gunpoint the following Albuquerque-area banks: the Bank of Albuquerque branch located at 3301 Coors Blvd. NW on Jan. 12, 2013; the New Mexico Bank and Trust branch located at 6201 Riverside Plaza Lane on Jan. 29, 2013; and New Mexico Educators Federal Credit Union located at 3205 Coors Blvd. NW on Jan. 29, 2013 and again on Feb. 1, 2013.
Mollohan has been in federal custody since his arrest on Feb. 1, 2013. He remains detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI and the Albuquerque Police Department with assistance from the New Mexico Corrections Department Probation and Parole, and is being prosecuted by Assistant U.S. Attorney Charles L. Barth. This case is being prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
6 March 2014
Wisconsin Man Pleads Guilty to Production of Child PornographyRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr., announced today that David Whitworth, 42, of Madison, Wisconsin, pleaded guilty to production of child pornography and receipt of child pornography before Chief U.S. District Court Judge William M. Skretny. The charges carry a maximum sentence of 35 years in prison, a $500,000 fine, or both.
Assistant U.S. Attorneys Marie P. Grisanti and Maura K. O’Donnell, who are handling the case, stated that the defendant posed as a modeling agent online to induce minors in the Western District of New York and elsewhere to produce pornographic images of themselves. The minors then emailed the images to Whitworth via the Internet.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The plea is the result of an investigation on the part of Special Agents of the Federal Bureau of Investigation, the Cheektowaga Police Department under the direction of Chief David Zack, and Lancaster Police Department under the direction of Chief Gerald Gill.
Sentencing is scheduled for July 23, 2014, at 9:00 a.m. before Chief Judge Skretny.Wanblee Man Sentenced for Failure to Register as A Sex OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that a Wanblee, South Dakota, man convicted of Failure to Register as a Sex Offender was sentenced on March 5, 2014, by U.S. District Judge Roberto A. Lange.
Jayme Lee Rivers, a/k/a Jayme Two Crow, age 34, was sentenced to 12 months and 1 day in custody, 5 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Rivers was indicted by a federal grand jury on August 21, 2013, and pled guilty to Failure to Register as a Sex Offender on December 11, 2013.
The conviction arose as a result of Rivers’ failure to register as a sex offender between July 2009 and March 2010. Due to his federal conviction in June 2000 for Sexual Abuse of a Minor, Rivers is required to register as a sex offender by the Sex Offender Registration and Notification Act. He knowingly failed to register and update his residential registration as required by federal law.
The investigation was conducted by the Cheyenne River Sioux Tribe Law Enforcement Division and the United States Marshals Service. The case was prosecuted by Assistant U.S. Attorney Mikal Hanson.
Rivers was remanded to the custody of the U.S. Marshals Service to begin serving his sentence.
U.S. Attorney's Office Launches "Fresh Start" Federal Prison Re-Entry ProgramRead the Press Release
TULSA, Okla. — A new Federal Prison Re-Entry program, named “Fresh Start,” will assist and provide individuals with felony convictions with resources for jobs, housing, and counseling services, announced U.S. Attorney Danny C. Williams Sr. for the Northern District of Oklahoma. The re-entry program is another component of U.S. Attorney General Eric H. Holder’s “Smart on Crime” initiative.
Participating agencies joining the U.S. Attorney's Office are: the Tulsa County District Attorney's Office; the United States Probation Office; and the Oklahoma Department of Corrections.
“The Department of Justice’s Anti-Violence Strategy, which is led by the U.S. Attorneys, prioritizes reentry as one of its three principal components, along with prevention and enforcement,” said U.S. Attorney Williams. “We are working collaboratively with federal and state correctional agencies in assisting individuals with felony convictions with re-entry into the community.”
Approximately 700,000 people are released from federal and state prisons every year. It is estimated that two-thirds of those released will likely be rearrested within three years of release.
Initial participants in the “Fresh Start” program will be GPS-monitored individuals from the Oklahoma Department of Corrections and those individuals who are on a parolee status. Later, the State’s participation in the federally-sponsored program will expand to include those individuals who are on probation.
Individuals will participate in an informational panel session which includes a representative of the U.S. Attorney’s Office, Tulsa County District Attorney’s Office, law enforcement, and a Success Speaker, an individual with a criminal history who has turned his/her life around. The “Fresh Start” program is designed not only to provide individuals with felony convictions with resources, but also to provide them with motivation for success within the community.
Two Men Plead Guilty to $1 Million Scheme to Defraud ArmyRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that two men have pleaded guilty to their roles in a $1 million fraud scheme to sell counterfeit and modified computer equipment to the U.S. Army.
Mark Morgan, 46, of Newport Coast, Calif., pleaded guilty today before U.S. District Judge Gary A. Fenner to the charge contained in a May 22, 2013, federal indictment. Roland Evans, 44, of Lee’s Summit, pleaded guilty to his role in the conspiracy on Wednesday, March 5, 2014.
Evans was an employee of Missouri Office Systems and Supplies, Inc. (MOSS), in Kansas City, Mo., which sold all types of office machines, including computers, software and other office furniture and supplies.
In August 2010, MOSS received a $2.1 million contract from the Army Recreation Machine Program (ARMP) for more than 2,500 Cisco parts – including network hardware, such as transceivers and switches, which allow computers to communicate with other computers. The network hardware was shipped to numerous locations, including ARMP headquarters at Fort Carson in Colorado Springs, Colo., as well as approximately 19 other ARMP locations in the United States and three international ARMP locations.
After receiving that contract, MOSS provided more than $1 million worth of counterfeit products and Cisco products that were used and modified post-manufacture and were obtained outside Cisco’s authorized distribution channels.
Evans handled all of the contracts MOSS had for Cisco products, including all of the contracts MOSS had with ARMP for Cisco products. MOSS provided 2,013 computer products that were improperly sourced, for which ARMP paid $1,073,022. Due to the products being improperly sourced, they were not eligible for Cisco warranties nor were the SMARTnet contracts legitimate. The products were unusable for ARMP and cannot be used in any portion of its computer network.
Evans admitted that he solicited equipment bids from Morgan’s firm, PRM Technology Equipment, LLC, knowing that it was outside of Cisco’s authorized distribution channels. Between August and December 2010, Morgan obtained counterfeit Cisco products and Cisco products which were used and modified post-manufacture outside of Cisco authorized distribution channels. Morgan shipped these products to ARMP, which paid MOSS $1,073,022. MOSS then paid Morgan $856,651 for the products.
Between September 2010 and August 2011, Evans and Morgan continued to insist to ARMP and to Cisco – in emails, phone conferences and meetings – that MOSS had supplied new, genuine Cisco goods and services which were sourced from Cisco authorized distribution channels and protected by full Cisco warranties as required by the contract. Evans and Morgan altered purchase orders and invoices, which they sent to Cisco to make it appear that the products were sourced properly.
Under the terms of today’s plea agreement, Morgan and Evans must pay $1,073,022 in restitution, for which they are jointly and severally liable. Under federal statutes, Morgan and Evans are subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $250,000. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Matthew P. Wolesky. It was investigated by the FBI, the Department of Defense – Office of Inspector General and the Department of Homeland Security.Two Men Charged with Extensive Counterfeit Media Scheme in FresnoRead the Press Release
FRESNO, Calif. — A federal grand jury returned a four-count indictment today against Emilio Perez-Solis, 39, of Oakland, and Hernan Cortes, 53, of Tulare, charging them with criminal copyright infringement for private financial gain, criminal copyright infringement, trafficking in counterfeit labels, documentation and packaging, and conspiracy, United States Attorney Benjamin B. Wagner announced.
According to court documents, the defendants used an agriculture building in Fresno as a distribution point for counterfeit CDs and counterfeit DVDs. From the building, Perez-Solis sold counterfeit CDs and DVDs, including movies that were only in theatrical release and not yet available on DVD. Cortes assisted Perez-Solis in distributing counterfeit media from the building. On February 21, 2014, the building in Fresno County was found to contain approximately 70,000 counterfeit music CDs and movie DVDs.
This case is the product of an investigation by the U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), with assistance from the Fresno County Sheriff's Department. Assistant United States Attorneys Henry Z. Carbajal III and Patrick R. Delahunty are prosecuting the case.
"Commercial piracy and product counterfeiting undermine the U.S. economy, rob Americans of jobs, stifle American innovation and promote other types of crime," said Mike Prado, resident agent in charge of HSI Fresno. "Intellectual property theft amounts to economic sabotage, which is why HSI will continue to aggressively pursue product counterfeiters and those who sell counterfeit products."
Perez-Solis and Cortes are currently in custody, and are scheduled to be arraigned in Fresno on March 10, 2014, at 1:30 p.m. If convicted, Perez-Solis and Cortes face a maximum statutory penalty of five years in prison and a $250,000 fine for the conspiracy, copyright infringement for financial gain, and trafficking in counterfeit labels charges. Criminal copyright infringement carries a maximum statutory penalty of three years in prison. 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 defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Individuals can provide invaluable assistance to HSI by reporting suspicious criminal activity to the HSI Tip Line at 866-DHS-2ICE (866-347-2423).Two Former Puerto Rico Law Enforcement Officers Sentenced for Scheme to Smuggle Heroin to InmatesRead the Press Release
A former state marshal and a correctional officer in Puerto Rico were sentenced today for attempting to smuggle heroin to inmates in exchange for payment, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico.
Joel Torres-Velazquez, 49, of Guánica, Puerto Rico, was sentenced to serve 37 months in prison, followed by three years of supervised release, by U.S. District Judge Francisco A. Besosa of the District of Puerto Rico. He pleaded guilty on Nov. 6, 2013, to a one-count indictment charging him with attempt to distribute a controlled substance.
Jessica Moreno-Alicea, 39, of Ponce, Puerto Rico, was sentenced to serve 37 months in prison, followed by four years of supervised release, by U.S. District Judge Daniel R. Dominguez of the District of Puerto Rico. She pleaded guilty on Dec. 6, 2013, to a one-count indictment charging her with attempt to distribute a controlled substance.
Torres-Velazquez was paid $600 to deliver a package of heroin to an inmate at the Ponce Superior Court, where Torres-Velazquez worked as a state marshal. On March 30, 2011, Torres-Velazquez met with an undercover agent, who he believed was a drug dealer, and was given what he believed to be a package of heroin. He delivered the purported heroin to an inmate in the courthouse that same day.
Moreno was paid $800 to deliver a package of heroin to an inmate at the Ponce State Penitentiary, where Moreno worked as a correctional officer. On Feb. 3, 2011, Moreno met with an undercover agent, who she believed was a drug dealer, and was given what she believed to be heroin. She delivered the purported heroin to an inmate in the prison on Feb. 8, 2011.
The case was investigated by the FBI’s San Juan Division. The case was prosecuted by Assistant U.S. Attorney Hector Ramirez-Carbó of the District of Puerto Rico and Trial Attorney Menaka Kalaskar of the Criminal Division’s Public Integrity Section.Two Convicted in Multi-Million Dollar Advance Fee and Alaskan Gold Mine Investment SchemesRead the Press Release
Brad Russell was convicted today by a federal jury in Brooklyn on all three counts of the indictment for defrauding developers and their clients of more than $9 million through an advance fee scheme and for defrauding investors through an Alaskan gold mine investment scheme. Kristofor Lange, the Vice President of Black Sand Mine, Inc. (“BSMI”), was also convicted on both counts charging him for his role in the gold mine investment scheme.1 The jury’s verdict followed a six-week trial in United States District Court held before the Honorable Dora L. Irizarry. The trials of co-defendants William Lange and Frank Perkins are scheduled to take place on September 22, 2014.2
The guilty verdicts were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, Philip R. Bartlett, Inspector in Charge, New York Division, U.S. Postal Inspection Service (USPIS), and W. Jay Abbott, Acting Special Agent in Charge, Federal Bureau of Investigation, Seattle Field Office (FBI).
“Through lies and deceit, the defendants took advantage of a national tragedy and unsuspecting investors and stole millions of dollars so they could line their own pockets. Their representations and assurances were not worth the price of the paper used to print the loan documents and stock certificates. We will vigorously pursue and bring to justice those who would defraud the investing public,” stated United States Attorney Lynch. Ms. Lynch thanked the USPIS and the FBI for their hard work and dedication through the course of the investigation and prosecution. Ms. Lynch also extended her grateful appreciation to the United States Attorney’s Office for the Western District of Washington for their assistance in the case.
The evidence at trial established that Russell, together with others at Harbor Funding Group Inc. (“HFGI”), executed an advance fee scheme by targeting regions affected by Hurricane Katrina. Russell and his co-conspirators told land developers and their clients that HFGI had lenders and funds available to provide financing for their real estate projects. As a condition for financing, HFGI required its clients to place ten percent of the loan amount in an attorney escrow account. Contrary to their representations, HFGI did not have lenders or funds available to finance the loans and stole the deposit money placed in escrow. Russell was the loan processor at HFGI and prepared and maintained the loan documents and escrow agreements. Through this fraudulent scheme, Russell and his co-conspirators stole more than $9 million from approximately 300 individuals.
At trial, the government also proved that Russell and Kristofor Lange, together with others, also executed an investment scheme and induced investors to invest in BSMI through lies and deceit. BSMI claimed that it was going to mine gold and other precious metals on Sitkinak Island in Alaska. Through the use of in-person presentations, cold calls and “webinars,” Russell, Lange, and their co-conspirators, convinced investors to invest in BSMI by lying to them about the credentials of BSMI’s officers and directors, BSMI’s assets and liabilities, the intended use of investor funds, and by concealing their prior involvement in HFGI.
When sentenced by Judge Irizarry, Russell faces a sentence of up to 20 years’ imprisonment for wire fraud conspiracy for the HFGI scheme. Russell and Lange also face a sentence of up to 20 years’ imprisonment for securities fraud and a sentence of up to five years’ imprisonment for conspiracy for the BSMI scheme.
The government’s case is being prosecuted by Assistant United States Attorneys Winston M. Paes, David C. Woll, Jr. and Alixandra E. Smith.
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 is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
The Defendants:
BRAD A. RUSSELL
Age: 42
Residence: Gig Harbor, Washington
KRISTOFOR J. LANGE
Age: 30
Residence: Gig Harbor, Washington
E.D.N.Y. Docket No. 10-CR-968
__________________________________________________________________________
1 Kristofor Lange was not charged in the advance fee scheme.
2 The charges against the co-defendants William Lange and Frank Perkins are merely allegations, and they are presumed innocent unless and until proven guilty.
Titusville Police Officer Indicted for Participating in A Drug Deal While Carrying A FirearmRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces the unsealing of an indictment charging Richard Irizarry (45, Viera) with attempting to aid and abet the distribution of cocaine, possessing a firearm in furtherance of the drug distribution, and using a telephone to facilitate the drug distribution. If convicted on all counts, Irizarry faces a minimum of 10 years, up to a maximum penalty of 40 years in federal prison. According to the indictment, Irizarry allegedly committed these offenses on or about January 19, 2014. Irizarry will make his initial appearance in federal court, in Orlando, at 1:30 p.m. today before United States Magistrate Judge Karla R. Spaulding.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Drug Enforcement Administration. It will be prosecuted by Assistant United States Attorney Vincent A. Citro.
(Download Factual Basis )
Texas man Charged with Traveling to Missouri for Illicit Sex with ChildrenRead the Press Release
Project Safe Childhood
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Texas man has been charged in federal court with traveling to Missouri to engage in illicit sex with two minor sisters whose “father” (an undercover officer) he met online.
John Paul Christian, 40, of Texas, was charged in a criminal complaint that was filed in the U.S. District Court in Kansas City, Mo., on Wednesday, March 5, 2014.
According to an affidavit filed in support of the federal criminal complaint, a Kansas City Police Department detective created an undercover profile on an online social media site. Christian contacted him on Feb. 19, 2014, the affidavit says, and he told Christian that he had two daughters (11 and 15 years old) with whom Christian could have sex for $400. Christian allegedly replied that he would pay to have sex with both of them.
Christian sent a text message to the undercover officer, the affidavit says, informing him that he had purchased an 18-karat gold “Hello Kitty” necklace and earrings and an iPod as gifts for the girls. On Feb. 26, 2014, Christian allegedly sent a text message with details about the sexual acts he wanted to perform on the 11-year-old daughter. Christian allegedly asked about the 15-year-old daughter joining in as well, for a total of “$400 for both girls.”
On Feb. 28, 2014, Christian allegedly wired $200 to the undercover detective, which was half of the amount he was going to pay to have sex with the two sisters.
According to the affidavit, Christian said he was going to drive to Kansas City on Saturday, March 1, 2014, and texted updates of his travel during the day. (Law enforcement officers later found evidence in his hotel room that he had flown from Texas to Kansas City.)
At about 4:34 p.m. on Saturday, March 1, 2014, Christian sent a text message saying he had arrived in Kansas City and was at the airport, the affidavit says. The undercover detective provided an address and arranged for them to meet at a nearby apartment complex. Christian arrived in a taxi at about 8:10 p.m. and was arrested as he got out of the taxi.
When he was taken into custody, Christian was in possession of two bags. One of the bags contained a “Hello Kitty” backpack doll, two “Hello Kitty” underwear outfits for young girls, two pairs of young girls’ panties, two cans of Red Bull, rope necklaces, Q-Tips and a teal iPod Nano with headphones. The other bag contained an Acer Chromebook laptop computer with power cables, a Samsung flip phone, and a bottle of Astroglide lubricant.
When officers searched Christian’s hotel room, they found a notebook with what appears to be a letter written to the 15-year-old daughter. According to the affidavit, the letter details the various sex acts that Christian was going to be engaged in with the sisters. Christian allegedly wrote that he wanted to get the 15-year-old girl pregnant so that they could have a “little baby girl together” that they in turn would sexually molest.
Dickinson cautioned that the charge contained in this complaint is simply an accusation, and not evidence of guilt. Evidence supporting the charge must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Patrick D. Daly. It was investigated by the Kansas City, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."Tax Preparer Indicted for Preparing Returns with Fraudulent Claims and Filing Own False Tax ReturnsRead the Press Release
HONOLULU - A federal grand jury yesterday indicted Melanau Fohe Haiola, age 52, for preparing false tax returns for her clients and for failing to report income she earned. The indictment charges that Haiola, of Kahuku, prepared 17 Federal Income Tax returns that fraudulently claimed the American Opportunity Credit, a deduction for undergraduate education expenses; personal property rental expense deductions; or medical, dental, or employee expenses. In addition, the indictment charges that Haiola filed false tax returns for herself for the 2009 and 2010 tax years by underreporting her income by a total of $114,315.
Florence T. Nakakuni, United States Attorney for the District of Hawaii, said that according to the indictment, Haiola, as owner and operator of Nau’s Tax Preparation, personally prepared, and supervised others in the preparation of, hundreds of federal income tax returns, many of which claimed the American Opportunity Credit and the personal property rental expense deduction when neither was legally applicable.
If convicted, Haiola faces up to three years in prison and a fine of up to $250,000 for each of the 19 charges. The charges in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
The prosecution resulted from an investigation conducted by the Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorney Marshall Silverberg.
Staten Island, N.Y., Tax Preparer Sentenced to Prison for Preparing False Tax ReturnsRead the Press Release
Ranti Azeez-Taiwo of Staten Island, N.Y., was sentenced to serve 18 months in prison to be followed by one year of supervised release, the Justice Department and Internal Revenue Service (IRS) announced today. Azeez-Taiwo was also ordered to pay $24,802 in restitution. On Sept. 30, 2013, a federal jury in the Eastern District of New York convicted Azeez-Taiwo of 16 counts of aiding or assisting in the preparation of false income tax returns for clients.
According to evidence introduced at trial, the defendant operated a tax preparation business called Lot Associates Inc., located in Staten Island. Evidence showed that the defendant aided, advised and prepared false individual income tax returns for clients during the 2006 through 2010 tax years. These false individual income tax returns claimed unreimbursed employee expenses and charitable donations that taxpayers testified the defendant claimed on their returns without the taxpayers’ knowledge. Several taxpayers testified they paid fines and interest to the IRS as a result of the false income tax returns Azeez-Taiwo had prepared and submitted to the IRS.
This case was investigated by IRS-Criminal Investigation and was prosecuted by Trial Attorneys Mark Kotila and Mark McDonald of the Tax Division.
Statement of United States Attorney Carmen M. OrtizRead the Press Release
United States vs. John J. O’Brien, et al.
1:12cr40026We are disappointed at the disruption and delay of this trial that has been caused by the defense's untimely recusal motion. The Court's rulings throughout this case have been well-reasoned and based on the law. We nevertheless remain committed to bringing this case to trial as soon as possible. This case must move forward without delay, not only because it is in the interest of justice to have that happen, but because we must instill public confidence in the criminal justice system and limit the continued expense of taxpayer dollars.
Springfield Man Pleads Guilty to Trafficking Counterfeit GoodsRead the Press Release
BOSTON – A Springfield man was convicted today in U.S. District Court in Springfield of selling counterfeit goods.
Josue Rivera, 38, pleaded guilty before U.S. District Judge Michael A. Ponsor to trafficking in counterfeit and unauthorized goods. As part of his plea agreement, Rivera agreed to pay $29,000 in restitution and forfeiture of two bank accounts worth approximately $79,000.
Rivera operated a retail merchandise business in Springfield called Main Source. From April 11 until June 25, 2012, Rivera stocked and sold counterfeit merchandise, including clothing, footwear, and accessories that bore a variety of brand names and trademarks, including Gucci, Nike, Coach, Chanel, and Oakley. Rivera also stocked and sold unauthorized reproductions of digital video discs of movies and compact discs of music.
United States Attorney Carmen M. Ortiz; Bruce Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston, and Springfield Police Commissioner William Fitchett, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Steven H. Breslow of Ortiz’s Springfield Branch Office.
Spencer Man Sentenced for Unlawful Taking of WildlifeRead the Press Release
United States Attorney Brendan V. Johnson announced that a Spencer, South Dakota, man convicted of Unlawful Taking of Wildlife was sentenced on March 3, 2014, by U.S. Magistrate Judge John E. Simko.
Dennis L. Rowley, age 63, was sentenced to 3 years of probation. His sentence also included a $3,000 fine, $3,050 restitution, and the loss of hunting privileges for 3 years.
An information was filed against Rowley on July 24, 2013, charging him with Unlawful Taking of Wildlife. He was found guilty of the charge at a trial held on January 27, 2014, before the Honorable Judge Simko.
In June of 2012, a person taking photographs of Double-crested Cormorants nesting on an island on a lake near Spencer called the South Dakota T.I.P.S. Hotline to report a person shooting the cormorants. Conservation officers with the South Dakota Game, Fish and Parks Department learned that the shooter was Dennis Rowley. They went to the island and found 61 dead cormorants.
This case was investigated by the South Dakota Game, Fish and Parks, and the U.S. Fish and Wildlife Service. Assistant U.S. Attorney Jeffrey C. Clapper prosecuted the case.
Sioux Falls Woman Sentenced in Embezzlement CaseRead the Press Release
United States Attorney Brendan V. Johnson announced that a Sioux Falls, South Dakota, woman convicted of Bank Embezzlement was sentenced on March 6, 2014, by U.S. District Judge Karen E. Schreier.
Kellie Cunningham, age 28, was sentenced to time served (one day) and 3 years of supervised release. She was also ordered to make restitution in the amount of $5,600.
Cunningham was indicted for Bank Embezzlement by a federal grand jury on August 13, 2013. She pled guilty on December 4, 2013.
Between May 2012 and March 2013, Cunningham was employed as a bank teller. During this timeframe, she stole money from her teller drawer for personal use and took steps to conceal the theft.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Ann M. Hoffman prosecuted the case.
Shreveport Man Sentenced to 24 Months in Prison for Failing to Appear for SentencingRead the Press Release
SHREVEPORT, La. –United States Attorney Stephanie A. Finley announced today thatLeo Cortez Vinson Jr., 40, of Shreveport, was sentenced Monday by U.S. District Court Judge Elizabeth Foote, to 24 months in prison with one year of supervised release for failing to appear for sentencing on a tax fraud charge.
According to evidence presented at the guilty plea on February 20, 2014, Vinson pleaded guilty in September of 2011 to filing fraudulent tax returns and was allowed to remain free on bond. He failed to appear for sentencing on November 30, 2011. A warrant was issued for Vinson’s arrest, and he was arrested on October 3, 2013 in South Dakota. Vinson had been traveling on a bus headed for Seattle, Washington.
On November 14, 2013, Vinson was sentenced by U.S. District Court Judge Tom Stagg, to 36 months in prison and one year of supervised release for one count of making false and fraudulent statements to the Internal Revenue Service (IRS). He was also ordered to pay $6,958 in restitution.. The failure to appear and the tax fraud prison terms will run consecutively for a total of 60 months in prison. The supervised release terms will run concurrently.
According to evidence presented at the guilty plea on September 1, 2011, Vinson prepared 22 Form 1040 tax returns containing false information in early 2009 for tax year 2008. He claimed $91,141 in refunds, but received $79,396 from the IRS. Vinson received between $1,000 and $1,500 per tax return on average. He would recruit inmates from different prisons to supply Social Security Numbers for the false returns and paid them $100 for their information.
“Tax fraud has consequences,” Finley stated. “The defendant thought he could run from justice, but because of the hard work of the prosecutor and law enforcement officers, he was apprehended. We will continue to prosecute those who try to manipulate the system for their gain.”
The IRS, U.S. Marshals Service, and U.S. Postal Inspection Service conducted the investigation. Assistant U.S. Attorney Cytheria D. Jernigan prosecuted the cases.
Seven Individuals Sentenced for Federal Supervised Release and Probation ViolationsRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistWHEELING, WEST VIRGINIA - United States Attorney William J. Ihlenfeld, II, announced that during the month of February, seven individuals had their supervised release or probation revoked for violating terms and conditions imposed by the United States District Court.
ELKINS DIVISION REVOCATIONS (Chief Judge John Preston Bailey)
ARCHIE RAY ARBOGAST, age 37, of Dunmoore, West Virginia, was sentenced to 24 months in prison and three years of supervised release for committing another crime; possession of a controlled substance; frequenting places where controlled substances are illegal sold, used, distributed or administered; and, associating with persons engage in criminal activity. ARBOGAST was originally sentenced on May 8, 2013, to 5 years probation for possession of material used in the manufacture of methamphetamine. ARBOGAST was remanded to the custody of the United States Marshal pending designation to a Federal institution.
WHEELING DIVISION REVOCATIONS (Judge Frederick P. Stamp, Jr.)
BRYAN KNORR, age 36, of Clarksburg, West Virginia, and formerly of Wheeling, was sentenced to 18 months in prison for testing positive for the use of marijuana and cocaine. KNORR was originally sentenced on March 7, 2011, to 21 months in prison and six years of supervised release for the distribution of ecstasy within 1,000 feet of a protected location. KNORR was remanded to the custody of the United States Marshal pending designation to a Federal institution.
MICHAEL SHANE HENRICK, age 35, of Newell, West Virginia, was sentenced to 6 months in prison and 12 months of supervised release for committing additional offenses of shoplifting, domestic battery, failure to report to the United States Probation Officer and absconding from supervision. HENRICK was originally sentenced on June 24, 2008, to 32 months in prison and three years of supervised release for the distribution of heroin. HENRICK was remanded to the custody of the United States Marshal pending designation to a Federal institution.
SCOTT NALE, age 44, of Weirton, West Virginia, was sentenced to forty-five days in prison for failure to update sex offender registration and unauthorized contact with a minor child. NALE was originally sentenced on August 21, 1995, to 168 months in prison and three years of supervised release for car jacking, use and carry of a firearm in relation to a crime of violence, and felon in possession of a firearm. NALE will self-report to the designated Federal institution on March 14, 2014.
MARTINSBURG DIVISION REVOCATIONS (Judge Gina M. Groh)
DEVON GORDON, age 23, of Martinsburg, West Virginia, was sentenced to 22 months in prison for associating with known felons, being untruthful with probation officer and fleeing from the Martinsburg Police. GORDON was originally sentenced on July 18, 2011, to 24 months in prison and three years of supervised release for possession with intent to distribute crack cocaine. GORDON was remanded to the custody of the United States Marshal pending designation to a Federal institution.
JOMO KENYATTA MORRIS, age 24, of Martinsburg, was sentenced to 10 months in prison and 12 months of supervised release for testing positive for the use of marijuana and cocaine, being untruthful with probation officer and being arrested for disorderly conduct and open container. MORRIS was originally sentenced on December 11, 2009, to 37 months in prison and three years of supervised release for possession with intent to distribute crack cocaine. MORRIS was remanded to the custody of the United States Marshal pending designation to a Federal institution.
LATEEF JABRALL MCGANN, age 23, of Martinsburg, was sentence to 7 months in prison and 29 months of supervised release for testing positive for the use of marijuana, being untruthful with probation officer and being arrested for fleeing from the Martinsburg police. MCGANN was originally sentenced on December 10, 2009, to 57 months in prison and three years of supervised release for possession with intent to distribute crack cocaine and felon in possession of a firearm. MCGANN was remanded to the custody of the United States Marshal pending designation to a Federal institution.
The United States was represented at the revocation hearings by Assistant U.S. Attorneys John C. Parr, Randolph J. Bernard, Robert H. McWilliams, Jr., Stephen D. Warner and Paul T. Camilletti.
The United States Probation Office carries out probation and pretrial services functions throughout the Northern District of West Virginia. With locations in Wheeling, Clarksburg, Martinsburg, and Elkins, the office works to assist the federal courts in the fair administration of justice, to protect the community, and to bring about long-term positive change in individuals under supervision. Jeff Givens is the Chief Probation Officer for the Northern District.
Sentencing for February 27 - March 6, 2014Read the Press Release
Randy W. Ayers, 36, of Gillette, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on March 6, 2014, for being a felon in possession of a firearm. Ayers was arrested in Gillette, Wyoming. He received 40 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Victor David Villagomez-Duarte, 21, of Denver, Colorado, was sentenced by Federal District Court Judge Scott W. Skavdahl on February 27, 2014, for conspiracy to possess with intent to distribute, and to distributing at least 200 grams of a mixture or substance containing a detectable amount of methamphetamine and for distribution of methamphetamine and aiding and abetting. Villagomez-Duarte was arrested in Albany County, Wyoming. He received 46 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $500.00 fine and a $200.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.
Sacramento Woman Gets 18 Months in Prison for Conspiracy to Traffic in Counterfeit Viagra and Cialis via CraigslistRead the Press Release
SACRAMENTO, Calif. — Susan Yvonne Eversoll, 46, of Sacramento, was sentenced this morning by U.S. District Court Judge Troy L. Nunley to 18 months in prison, to be followed by three years of supervised release and a $5,000 fine, for conspiring to traffic in counterfeit goods, United States Attorney Benjamin B. Wagner announced.
This case is the product of an investigation by the Federal Bureau of Investigation and the Sacramento County Sheriff’s Hi-Tech Crimes Task Force. Assistant United States Attorney Michelle Rodriguez is prosecuting the case.
According to court documents, law enforcement received information about “Viagra” and “Cialis” being offered for sale through the Internet on Craigslist. Law enforcement later conducted controlled drug purchases of counterfeit Viagra from co-defendant Rickey Lee Campbell, 60, of Sacramento, who used the alias “Diamond Jim.” Eversoll and Campbell’s residences were searched and more than 6,000 counterfeit tablets resembling Viagra and Cialis in shape, size, and color were found. Authorities also recovered computers and electronic devices the conspirators used to sell the counterfeit goods.
Campbell has pleaded guilty to the conspiracy and is scheduled to be sentenced on May 8, 2014. He faces up to 10 years in prison for his leadership role in the conspiracy. His sentence, however, will 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.
Rockwall Resident Sentenced and Ordered to Pay $10 Million in Restitution for Massive Fraud SchemeRead the Press Release
HOUSTON – Kelly Taylor Gipson, 34, has been ordered to federal prison for 48 months and ordered to pay $9,651,660.15 to victims of life settlement investment fraud scheme, announced United States Attorney Kenneth Magidson along with special agent in charge Lucy Cruz, Internal Revenue Service – Criminal investigation (IRS-CI) and Inspector in Charge Robert Wemyss, U.S. Postal Inspection Service (USPIS).
Gipson was accused along with Charles Craig Jordan, 34, of misappropriating investor funds which ultimately resulted in policies lapsing and investors losing their investment. Jordan entered a guilty plea to conspiracy to commit mail and wire fraud, while Gipson pleaded to conspiring to launder the proceeds from the fraud scheme.
Today, U.S. District Judge Lee H. Rosenthal sentenced Gipson to the four-year-term to be followed by three years of supervised release. Jordan was sentenced in December 2013 to 156 months in federal prison. Both were further ordered to pay restitution of $9,661,660.15 to 503 individuals named as victims in the case.
Jordan and Gipson were accused of devising a scheme to defraud investors from around the United States and Canada who invested millions in the life settlement offerings of Secure Investment Services and American Settlement Associates of Houston. Secure Investment Services was a business name utilized by Jordan initially in this scheme.
A life settlement is an investment in which a person, who is typically elderly or terminally ill, sells his or her life insurance policy for a cash payment, which is a percentage of the life insurance policy’s face value or death benefit payable by the insurance company upon the insured’s death. Once the insured sells an insurance policy, the insured is no longer responsible for paying the policy’s premiums. To keep the policy in force, the life settlement company must ensure any premiums are paid. All premiums due prior to the death of the insured must be paid, in full and on a timely basis, to prevent additional cost or lapse. Investors who purchase life settlements only realize a profit if the total amount invested in the policy, including the purchase price and any additional premium costs, is less than the amount of the death benefit. A life settlement is not profitable if the expenses of acquiring and maintaining the policy (including the amount of premiums that are paid) are more than the amount of the death benefit paid when the insured dies. Typically, the longer an insured lives, the more expensive it is to maintain a life settlement.
Jordan resided in Los Angeles, Calif., and Gipson lived in Rockwall, Texas, while they have been on bond pending the criminal proceedings. While on bond, each are to make monthly payments into the registry of the court towards an anticipated restitution order.
The criminal investigation was conducted by IRS-CI and USPIS and prosecuted by Assistant United States Attorney Melissa Annis.Rochester Man Sentencing on Drug and Gun ChargesRead the Press Release
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that David Colon, 37, of Rochester, N.Y., who was convicted of possession of marijuana with the intent to distribute, and being a felon in possession of a firearm, was sentenced to 46 months in prison by U.S. District Court Judge Frank P. Geraci, Jr.
Assistant U.S. Attorney Charles E. Moynihan, who handled the case, stated that on October 10, 2008, members of the Greater Rochester Area Narcotics Enforcement Team executed a search warrant at Colon’s residence at 104 Maple Avenue, in Irondequoit, N.Y. Officers encountered a woman and two children in the house at the time. Colon arrived at the location later. During the search, officers seized over 400 grams of marijuana in a storage area in the basement along with two digital scales and marijuana packaging material. Officers also recovered over $4,000.00 in United States currency, ammunition, and a defaced .38 caliber revolver as well as book detailing the subject of growing marijuana.
Colon gave a statement to officers in which he admitted to dealing marijuana from inside his house and that he had the gun to protect his family in case someone tried to rob him.
The sentencing is the result of an investigation by the Greater Rochester Area Narcotics Enforcement Team, composed of law enforcement personnel in Monroe County, under the direction of Rochester Police Department Acting Chief Michael Ciminelli, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Thomas J. Cannon.Rhode Island Man Charged for Failure to Register as Sex OffenderRead the Press Release
BOSTON – A Pawtucket, R.I. man was indicted today, charged with failure to register as a sex offender. The indictment alleges that Ryan Hathaway, 32, is required to register under the Sex Offender Registration and Notification Act, and that he traveled interstate in late 2013 and failed to register as required.
The maximum sentence under the statute is 10 years in prison, three years of supervised release and a $250,000 fine.
United States Attorney Carmen M. Ortiz and John Gibbons, U.S. Marshal of the U.S. Marshals Service, District of Massachusetts, made the announcement today. The case is being prosecuted by Special Assistant U.S. Attorney Timothy Landry of Ortiz’s Major Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Reston Man Pleads Guilty to Exporting Unlicensed Goods to IranRead the Press Release
Defendant shipped over $250,000 in high-tech items through United Arab Emirates
ALEXANDRIA, Va. – Vahid Hosseini, 62, of Reston, Va., pleaded guilty today to two felony counts arising from his involvement in exporting various unlicensed goods from the United States to Iran.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by United States District Judge Liam O’Grady.
Hosseini pleaded guilty to conspiracy to violate the Iranian Transactions and Sanctions Regulations under the International Emergency Economic Powers Act (IEEPA), and a separate count of money laundering. Hosseini faces a maximum penalty of 15 years in prison and fines totaling $250,000 when he is sentenced on June 6, 2014.
In a statement of facts filed with the plea agreement, from at least as early as January 2008 to July 2013, Hosseini operated a business known as Sabern Instruments from his residence in Reston. Through this business, Hosseini procured over $250,000 worth of goods from over 60 American manufacturers, which he then repackaged and shipped to entities in Iran. The list of high-tech goods included tachometers, power supply instruments, high-temperature probes, ammonia test tubes, valves and machinery parts, all of which are used in a variety of commercial applications, including power plants. Hosseini routed these shipments through the United Arab Emirates (UAE) in an attempt to disguise the fact that the items were destined for Iran. Such exports are prohibited without a license issued by the Treasury Department’s Office of Foreign Assets Control.
In a related money laundering scheme, Hosseini had over $700,000 wired into his company business account from entities in Iran and the UAE, much of which was derived from his illegal export business. He then unlawfully withdrew money from his business account for personal expenditures.
This case was investigated by the FBI’s Washington Field Office. Assistant United States Attorney Neil Hammerstrom is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Postal Manager Charged with Taking Bribes in Exchange for Postal ContractsRead the Press Release
The manager of the U.S. Postal Service’s Vehicle Maintenance Facility in Cleveland was charged with taking cash bribes in exchange for awarding business and contracts from the Postal Service, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Monica Weyler, Special Agent in Charge of the U.S. Postal Service’s Office of Inspector General Eastern Area Field Office.
Kevin Hood, 45, of Richmond Heights, was arrested Thursday and charged with wire fraud and honest services wire fraud.
“Some defendants appear to still have not gotten the message that accepting bribes has no place in Northeast Ohio,” Dettelbach said. “We will continue to work to stamp out public corruption in all its forms.”
“This crime is particularly egregious considering the defendant was promoted to this position because the former manager was convicted on similar charges,” Weyler said.
Hood worked for the Postal Service since 1998 and most recently served as the manager of the Vehicle Maintenance Facility at 1801 Broadway Avenue in Cleveland. In that job, Hood had the ability to award and monitor contracts on behalf of the Postal Service.
The owner of a Cleveland company that has contracts with the Postal Service said Hood approached him for money in order to get work and contracts from the Postal Service. In late 2011, the business owner paid Hood in cash and believed he had to continue to pay Hood to receive work, according to a criminal complaint filed in the case.
The owner estimated he paid between $15,000 and $17,000 to Hood to date. He also estimated he provided up to $8,000 in free labor on Hood's personal vehicles, according to the complaint.
The owner stated Hood told him this was part of the deal in the owner receiving Postal Service work, according to the complaint.
On March 6, the owner paid Hood $4,500 in $100 bills. Hood placed the envelope containing the bills in his left boot. The transaction was monitored and recorded by USPS Office of Inspector General special agents, according to the complaint.
A charge 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.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorneys Miranda Dugi and Antoinette T. Bacon following an investigation by special agents of the U.S. Postal Service’s Office of Inspector General.
Physician Pleads Guilty for Role <br /> in Detroit-Area Medicare Fraud SchemeRead the Press Release
A former Detroit-area physician pleaded guilty today for his role in an $11.5 million health care fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office made the announcement.
Jose Mercado-Francis, 60, formerly of Brownstown Township, Mich., pleaded guilty before U.S. District Judge Nancy G. Edmunds in the Eastern District of Michigan to one count of conspiracy to commit health care fraud.
According to court documents, Mercado-Francis admitted that, beginning in approximately September 2009 and continuing through February 2012, he held himself out as a licensed physician and purported to provide physician home services to Medicare beneficiaries, when actually his medical license had been revoked and he was not licensed to practice medicine in Michigan.
Court documents allege that Mercado-Francis operated his scheme out of a medical practice known as House Calls Physicians P.L.L.C., which was located in Allen Park, Mich., and owned by a co-conspirator. Mercado-Francis prepared medical documentation that licensed physicians signed as if they had provided services to Medicare beneficiaries, when, in fact, they had not. The services were then billed to Medicare as if the licensed physicians had performed them.
Court documents further allege that, between approximately May 2008 and October 2012, House Calls Physicians billed Medicare more than $11.5 million for the cost of physician home services. Of that amount, Dr. Mercado-Francis caused the submission of approximately $1.1 million in false and fraudulent physician services claims.
At sentencing, which will be scheduled at a later date, Mercado-Francis faces a maximum penalty of 10 years in prison and a $250,000 fine.
This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. This case is being prosecuted by Trial Attorney Matthew C. Thuesen of the Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, the HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .Perry Physician Indicted for Unlawfully Dispensing Controlled SubstancesRead the Press Release
TALLAHASSEE, FLORIDA – Perry, Florida, physician Eulogio Muncal Vizcarra, 71, was arrested yesterday on charges contained in a federal indictment. U.S. Attorney Pamela C. Marsh announced that the grand jury charged Vizcarra with 49 counts of unlawfully dispensing, or causing the dispensing of controlled substances.
According to the indictment, Vizcarra operated a medical business known as the Perry Family Medical Clinic on S. Jefferson Street in Perry, Florida, where Vizcarra is charged to have prescribed controlled substances to patients without sufficient medical necessity. He allegedly prescribed these substances in quantities and dosages that caused patients to abuse, misuse, and become addicted to the drugs. The indictment further alleges that Vizcarra prescribed controlled substances to patients knowing that the patients were addicted to and misusing these drugs, and that he continued to prescribe addictive controlled substances to patients even after learning that the patients had suffered overdoses on the drugs, were selling the drugs, or were ‘doctor shopping.’
He made his initial court appearance on the charges before U.S. Magistrate Judge Charles A. Stampelos at the U.S. District Courthouse in Tallahassee today. The trial is scheduled for April 14 before U.S. District Judge Mark E. Walker at the U.S. District Courthouse in Tallahassee.
If convicted of unlawfully dispensing controlled substances, Vizcarra faces a term of up to 5, 10, or 20 years imprisonment depending upon the controlled substances involved, and a fine of up to $1,000,000.
This indictment is the result of a joint investigation conducted by the Drug Enforcement Administration, the Federal Bureau of Investigation, the United States Marshals Service, the Florida Department of Health, Taylor County Sheriff’s Office, and the United States Attorney’s Office for the Northern District of Florida. The case is being prosecuted by Assistant United States Attorney Eric K. Mountin.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the Government's burden to prove guilt beyond a reasonable doubt in a court of law.
Owners of Tax Preparation Business Indicted on New Charges for Filing Phony Tax Returns for New Jersey Prison InmatesRead the Press Release
TRENTON, N.J. – The owners of a tax preparation business that filed fraudulent tax returns on behalf of inmates at various New Jersey prisons were indicted today on additional charges of mail fraud and making claims to the United States for payment of fraudulent tax refunds, U.S. Attorney Paul J. Fishman announced.
The 20-count superseding indictment returned by a federal grand jury against Kamal J. James, aka “Bro Messiah Aziz El,” of Seaford, Del., and Crystal G. Hawkins, aka “Sis. Crystal Gabri El,” of Laurel, Del., adds 16 counts of making claims to the United States for payment of fraudulent tax refunds, and three counts of mail fraud. The original count of conspiring to defraud the United States, on which the defendants were indicted on Jan. 16, 2014, remains in place.
According to the superseding indictment and other documents filed in court:
Between October 2011 and October 2013, defendants James and Hawkins operated Release Refunds, a purported tax preparation business – previously based in Brick, N.J., and now in Seaford, Del. – through which they solicited current and former New Jersey prison inmates as clients and then filed fraudulent tax returns on their behalf.
To execute the scheme, James and Hawkins sent Release Refunds “promotional” flyers to inmates at various New Jersey prisons and halfway houses offering tax return preparation services. The pair asked inmates interested in Release Refunds’ services to provide basic identification information and to sign income tax returns and other IRS documents, but not to include any information about their income or withholdings. James and Hawkins then filled in the missing income information on the return forms, fabricating the inmates’ earnings to trigger fraudulent and inflated refunds.
During the course of the investigation, an undercover IRS-Criminal Investigation agent posing as an inmate in a New Jersey prison submitted a completed Release Refunds form and sent it to James and Hawkins. They then sent the “inmate” blank income tax forms and other IRS documents and instructions to sign the documents. James and Hawkins did not request any financial information from the undercover agent before preparing three fraudulent tax returns – including false income information that James and Hawkins provided – to be filed on behalf of the agent for tax years 2010 through 2012. The fraudulent returns resulted in several thousand dollars in refunds and a $1,485 fee for the defendants.
The conspiracy count carries a maximum potential penalty of 10 years in prison. The fraudulent claims counts each carry a maximum potential penalty of five years in prison and the mail fraud counts each carry a maximum potential penalty of 20 years in prison. The defendants also face a fine of $250,000 or twice the amount of the gain or loss from the offense for each count of conviction.
U.S. Attorney Fishman credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, with the investigation leading to today’s charges. He also thanked the U.S. Postal Inspection Service and the N.J. Department of Corrections for their roles in the case.
The government is represented by Assistant U.S. Attorney Nicholas P. Grippo of the U.S. Attorney’s Office Criminal Division in Trenton and Trial Attorney Tino Lisella of the Justice Department’s Tax Division.The charges and allegations contained in the superseding indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
14-078
Defense counsel: James: Pro se; (Bruce Throckmorton Esq., Trenton, standby counsel)
Hawkins: Pro se; (Andrea Bergman Esq. Assistant Federal Public Defender, Trenton, standby counsel)Owner of Web Hosting Service for Japanese Child Pornography Distribution Website Sentenced to 20 YearsRead the Press Release
SAN FRANCISCO – Kimihiko Makino was sentenced today to 20 years in prison, and ordered to pay $10,000 in restitution for aiding and abetting the advertising of child pornography for sale, announced United States Attorney Melinda Haag and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Special Agent in Charge Clark E. Settles.
Makino, 40, a Japanese national, pleaded guilty on June 24, 2013 to advertising child pornography. According to the plea agreement, Makino admitted to operating servers, located in San Francisco, for a Japanese website known as “Daio,” which advertised the sale of DVDs containing child pornography. Through his maintenance of Daio’s servers, Makino admitted, he knowingly caused the advertisements to be published. The website contained tens of thousands of visual depictions of children, primarily under the age of eight, being victimized and coerced and forced to engage in sexually explicit and often sado-masochistic conduct.
Makino was indicted on July 12, 2012, for advertising child pornography, in violation of 18 U.S.C. 2251(d)(1)(A), and possessing child pornography, in violation of 18 U.S.C. § 2252(a)(4)(B). He was arrested while visiting the United States from Japan for the purpose of maintaining Daio’s servers. In the related Japanese investigation, Japanese authorities have indicted and convicted ten others associated with Daio.
“This country will not tolerate the abuse of children through the production of child pornography, which permanently harms the physiological, emotional, and mental health of children,” said United States Attorney Melinda Haag. “One of the best means of attacking the market for material from this often clandestine industry is to impose severe criminal penalties on individuals who advertise or sell it. This sentence plainly demonstrates that those who engage in the advertisement and distribution of child pornography in the United States deserve to be, and will be, punished severely.”
“Those who trade child pornography over the Internet are a part of a disturbing cycle of violence against children, and, as this case makes clear, face serious consequences” said Clark Settles, special agent in charge of HSI San Francisco. “The reality is, every time a photo or a video of an innocent child being sexually exploited is viewed, that victim is violated again. HSI will continue to aggressively target those who prey upon and sexually exploit our children in the United States and throughout the world. We owe it to youngsters, who will carry the emotional and physical scars of these crimes with them for the rest of their lives.”
The sentence imposed by the Honorable Jeffrey S. White, United States District Court Judge, also included a five year term of supervised release, restitution of $10,000 to be paid to the National Center for Missing and Exploited Children, and forfeiture. The defendant has been in custody since his arrest.
Hartley M. K. West is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Rosario Calderon. The prosecution is the result of a two year investigation by the U.S. Attorney’s Office and the U.S. Department of Homeland Security, Homeland Security Investigations, Resident Agent in Charge, San Francisco International Airport. Critical assistance in this investigation was provided by the National Police Agency of Japan, the Tokyo Metropolitan Police Department and HSI Tokyo.
(Makino indictment )
Oregon Man Sentenced to Ninety-Seven Months for Child PornographyRead the Press Release
SAN JOSE – John William Harrison was sentenced yesterday to more than 8 years in prison for possession of child pornography, announced United States Attorney Melinda Haag and U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Special Agent in Charge Clark E. Settles.
Harrison pleaded guilty on July 24, 2013, to one count of possession of child pornography, in violation of Title 18, United States Code, Section 2252. According to the plea agreement, Harrison admitted to engaging in multiple on-line conversations from his home in Portland, Ore., with a person he believed was the father of a seven-year old girl living in San Jose, Calif. The person posing as a father was really a special agent with the Department of Homeland Security working in an undercover capacity. During these conversations Harrison indicated he had over 600 still images and at least 75 videos of children engaged in sexually explicit conduct. Harrison also admitted that at least one of the videos contained footage of a child being subjected to sadomasochistic behavior and that most of the images found on his computer involved pre-pubescent minors under the age of 12. Finally, he admitted that he sent all of these digital files to the undercover agent in San Jose using both his Yahoo email account and the U.S. Mail.
Harrison, 45, of Portland, was arrested pursuant to a felony complaint on May 8, 2013, and arraigned in front of a United States Magistrate Judge in Portland on May 9, 2013. He was charged initially with distribution of child pornography. After making his first appearance in San Jose on May 23, 2013, Harrison agreed to waive indictment by a grand jury and was charged by Information with possession and distribution of child pornography on June 7, 2013.
The sentence was handed down by the Honorable Lucy H. Koh, United States District Court Judge, following the guilty plea. Judge Koh also sentenced the defendant to a 5-year period of supervised release. Harrison will also be required to register as a sex offender. The defendant was in custody at the time of sentencing and began serving his sentence immediately.
Amie D. Rooney is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Tracey Andersen. The prosecution is the result of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), in conjunction with the Silicon Valley Internet Crimes Against Children SAFE Task Force.
(Harrison information )
Nine Charged for Thefts from Union FundRead the Press Release
Orlando, Florida – United States Attorney A. Lee Bentley, III announces the unsealing of a criminal complaint in which nine individuals were charged with theft from an employee benefit plan. If convicted, Brandon Alfonso (28), James McCall (32), Marta Blackmer (70), Phillip Simmons (50), Ian Chase Dove (26), Jason Ferrari (33), all of Orange City, along with Jason Wesson (37) and Michael Giesinger (36), both of Deltona, and Shane Riley (31, Deland) each faces a maximum penalty of 5 years in federal prison.
According to court documents, Angela Deleon worked at Advance Administration, Inc. (AAI), which was the third-party administrator of an employee benefit plan for the Ironworkers Local 808. As the third-party administrator for the Ironworkers Local 808 Annuity Fund, AAI was responsible for processing members’ payment applications, paying the Fund’s bills, and speaking with union members. Deleon’s duties at AAI included data entry and the processing of payments.
Over a period of about 14 months, Deleon wrote 46 checks from the Fund, totaling over $427,000, to individuals who were not members of the Local 808 or participants in the Fund. The individuals who received those checks from Deleon were her drug dealers or others whom she knew. Those individuals cashed the checks, took whatever money that Deleon owed them, and then provided her with a share of the proceeds.
Alfonso, McCall, Blackmer, Simmons, Dove, Wesson, Ferrari, Giesinger, and Riley were involved in the scheme by allegedly cashing checks written by Deleon, on the Fund’s account, and by splitting the proceeds with her. As of the date of this press release, seven of the nine defendants (McCall, Blackmer, Simmons, Dove, Wesson, Giesinger, and Riley) have been arrested and have had their initial appearance in federal court.
Deleon was previously convicted for her participation in these crimes. She was sentenced to 2 years in federal prison and ordered to pay $594,000 in restitution to the Ironworkers Local 808 Annuity Fund. The restitution amount includes the more than $427,000 that Deleon stole from the Fund, plus the amounts spent by the Fund to audit and reconstruct the records that were impacted by Deleon’s scheme.
A criminal complaint is merely a charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
These cases were investigated by the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, and the U.S. Department of Labor’s Employee Benefits Security Administration. They are being prosecuted by Assistant United States Attorney Roger B. Handberg.
New York State Assemblyman William F. Boyland, Jr. Convicted of Bribery, Fraud, Extortion, Conspiracy and TheftRead the Press Release
Earlier today, sitting New York State Assemblyman William F. Boyland, Jr. was convicted by a jury at the federal courthouse in Brooklyn, New York, of twenty-one felony counts, including federal programs bribery, conspiracy to commit federal programs bribery, conspiracy to violate the Travel Act and commit federal programs bribery, extortion, extortion conspiracy, honest services wire fraud, conspiracy to commit honest services wire fraud, federal programs theft and conspiracy to commit mail fraud. Boyland committed each of these offenses by corruptly exploiting his public position representing the 55th Assembly District in Brooklyn, which is comprised of Ocean Hill, Brownsville, Bedford-Stuyvesant, Crown Heights and Bushwick. Upon his convictions, Boyland was automatically expelled from the Assembly. When sentenced, Boyland faces prison terms of up to 20 years on each of the extortion, extortion conspiracy, honest services wire fraud, honest services wire fraud conspiracy and mail fraud conspiracy counts, up to 10 years on each of the federal programs bribery and federal programs theft counts and up to five years on each of the other conspiracy counts. Following his convictions, the Honorable Sandra L. Townes, who presided over the trial, ordered Boyland remanded into custody pending his sentencing on June 30, 2014. Boyland is also subject to up to at least $250,000 in fines on each of the counts of conviction, as well as criminal forfeiture and mandatory restitution.
The convictions 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, New York Field Office.
“The breadth and pervasiveness of the corruption exposed by this prosecution is staggering. Wherever there was an opportunity for William Boyland to corruptly line his own pockets, he took it. By soliciting bribes, by stealing funds intended to help the elderly, and by defrauding New York State and the Assembly, Boyland cravenly pursued his own interest at the expense of his constituents. In doing so, Boyland not only broke the law, but broke faith with the public he was elected to serve. Today’s verdict ensures that Boyland will be held accountable for his corrupt actions,” stated United States Attorney Lynch. “When our elected officials engage in self-dealing, when they abdicate their responsibilities, when they succumb to greed, the average citizen pays for it dearly, and our democratic system suffers on so many levels. The verdict sends a clear message that we and our partners in the FBI will vigorously investigate and prosecute any public official who trades on a position of power to line his own pocket.” United States Attorney Lynch praised the hard work and dedication of the FBI agents who investigated the case and expressed her thanks to the New York State Comptroller’s Office, the New York State Office of the Aging, the Internal Revenue Service Criminal Investigation Division, the New York State Assembly Department of Finance and the New York City Department of Investigation for their assistance with the investigation.
The evidence admitted at trial proved that, beginning in January 2007 and continuing through December 2011, Boyland engaged in four separate corrupt schemes, ranging from soliciting and accepting over $250,000 in bribe payments, to submitting false travel vouchers to New York State, to stealing state funds intended for the elderly:
1. Carnival Scheme: Boyland extorted and accepted over $14,000 in bribes, in exchange for undertaking official action to benefit a carnival promoter (the “Promoter”) and an undercover FBI agent. Specifically, in August 2010, Boyland met with the Promoter and this undercover FBI agent (“UC1”) on multiple occasions in New York City and discussed the desire of the Promoter and UC1 to hold carnivals in Boyland’s district, for which they needed government approvals. During those meetings, Boyland requested payments in exchange for assisting the Promoter and UC1, and the Promoter and UC1 agreed. Boyland also described various ways in which the bribes could be disguised to hide their true purpose. After these meetings, Boyland directed his Assembly staff to assist the Promoter and UC1 in their efforts to gain government approvals. Boyland then represented to the Promoter and UC1 that he and his staff (i) engaged in discussions with government agencies to assist the Promoter in obtaining carnival-related leases and permits, and (ii) arranged for a non-profit organization to sponsor the Promoter’s carnivals. Boyland also directed his staff to give the Promoter letters of support, on Boyland’s Assembly letterhead, that the Promoter needed in order to operate carnivals in Boyland’s district. In exchange, UC1 paid Boyland three separate bribes: $7,000 in cash; a $3,000 check with the “payee” line left blank; and $3,800 worth of money orders that were deposited into Boyland’s campaign bank account. As was shown to the jury during the trial, Boyland was captured on videotape personally accepting the $7,000 cash bribe at his district office.
2. Real Estate Scheme: Boyland also accepted the $7,000 cash bribe described above in exchange for undertaking official action to benefit UC1 and a second undercover FBI agent (“UC2”) in a purported real estate venture in Boyland’s district. Specifically, Boyland proposed a brazen scheme in which UC1 and UC2 would purchase the former St. Mary’s Hospital in Boyland’s district for $8 million, obtain state grant money to renovate the hospital, and resell it for $15 million to a non-profit organization that Boyland claimed to control. Boyland assured UC1 and UC2 that he would use his influence as an Assemblyman to secure state grant money for the project and handle any zoning issues that arose. After accepting the $7,000 cash bribe described above, Boyland was later recorded demanding an additional $250,000 bribe payment from UC1 and UC2 as a condition of using his official position to realize the real estate scheme he had proposed.
Recordings of meetings in hotel rooms in Atlantic City and New York City where Boyland discussed the real estate scheme revealed that he recognized the scheme’s corrupt and illegal nature and sought to conceal his own involvement. At the meeting in the hotel in Atlantic City, Boyland stated, “I got a middle guy by the way . . . I gotta stay clean . . . I got a bag man . . . .” Boyland further explained that he did not want to talk on the telephone and preferred in-person meetings: “I stopped talking on the phone a while ago . . . I’m just saying there is no real conversation that you can have . . . especially with what we’re talking about.”
At the meeting in the hotel room in New York City, Boyland reiterated that he wanted UC1 and UC2 to pay him a $250,000 bribe in exchange for the St. Mary’s Hospital project. When UC2 instead countered Boyland’s demand by offering to pay Boyland $5,000 for introductions to other government officials who would be involved in the project, Boyland rejected the counter-proposal, stating that the people whom Boyland could introduce to UC1 and UC2 were worth more than $5,000: “I’m not talking about $5,000 folks. I’m talking about . . . people that can actually get these projects done . . . .”
3. False Voucher Scheme: From January 2007 to December 2011, Boyland stole New York State funds by submitting false New York State Assembly Member Travel Vouchers (“Vouchers”). Boyland submitted over two hundred fraudulent vouchers where he falsely claimed to be in Albany on legislative business when he in fact was not in Albany, including days when Boyland was in New York City meeting with the undercover FBI agents and demanding $250,000 in bribes; days when he was in North Carolina and Virginia visiting with family and friends; and for days when he was in Istanbul, Turkey. In reliance on Boyland’s false Vouchers, New York State paid Boyland over $70,000 in fraudulent mileage expense reimbursements and per diem payments.
4. Theft of State Funds for the Elderly: From July 2007 to September 2010, Boyland conspired to defraud New York State and the New York State Office of the Aging (“NYSOA”). Boyland, a member of the Assembly’s Committee on the Aging, steered $200,000 of New York State “member item” funds to a Brooklyn-based non-profit organization whose mission, as described on its website, was to provide a “social setting that enable[s] elderly individuals to maintain their independence and remain at home in the community.” Notwithstanding his certification, in writing, to the NYSOA that these state funds would not be used for any partisan or political purpose, Boyland directed that the majority of these $200,000 in state funds be used for the benefit of Boyland and his political campaigns by paying for community events that promoted Boyland such as a Senior Lunch Cruise on the Spirit of New York Cruise Line, a fireworks show, and a large end of the summer picnic held at a park in his district, as well as goods that promoted Boyland, such as “Team Boyland” t-shirts distributed at those community events.
The government’s case is being prosecuted by Assistant United States Attorneys Christina B. Dugger, Robert L. Capers and Lan X. Nguyen.
The Defendant:
WILLIAM F. BOYLAND, JR.
Age: 43
Residence: Brooklyn, New York
Nevada Man Sentenced to Prison for Possession of Stolen Truck, Weapons and Homemade ExplosivesRead the Press Release
A 22-year-old man who was arrested in July 2013 by University of Washington Police in a stolen truck with stolen firearms, body armor and gasoline incendiary devices, was sentenced today in U.S. District Court in Seattle to three years in prison and three years of supervised release, announced U.S. Attorney Jenny A. Durkan. JUSTIN MILES JASPER pleaded guilty to transportation of a stolen vehicle, possession of a stolen firearm and possession of destructive devices in November 2013. A key provision of the sentence requires JASPER to participate in mental health counseling. At the sentencing hearing U.S. District Judge Ricardo S. Martinez said the investigation revealed JASPER had “no specific plan,” but noted that possession of the weapons and explosives was both alarming and dangerous for the public, law enforcement and the defendant.
JASPER was arrested on July 3, 2013 near the UW campus in Seattle. He was driving a 1998 Dodge Ram 2500 pick-up truck with Montana plates. The truck had been reported stolen by the owner in Butte, Montana. Inside the truck police found a Stevens Model 311A double-barrel 12-gauge shotgun, with no serial number, and a Mauser Model 1895 bolt-action rifle. Both guns had been stolen from the same owner as the truck. According to the plea agreement, the truck also contained six destructive devices commonly referred to as “Molotov cocktails.”
According to records filed in the case, the investigation never uncovered any plan by JASPER to use the weapons or explosives. Both sides recommended that Judge Martinez require mental health counseling while JASPER is on supervised release and will recommend the Bureau of Prisons place JASPER at a facility with mental health treatment while he is incarcerated.
At the close of the sentencing hearing Judge Martinez noted that law enforcement had carefully investigated JASPER’s conduct, and said the investigation led to a better outcome. Judge Martinez said, “I commend everybody’s effort on this case.”
The case was investigated by the FBI, the UW Police Department, and the Seattle Police Department. The case was prosecuted by Assistant United States Attorney Todd Greenberg.
Nashville Man Indicted on Charges of Bank Larceny, Money Laundering and Aggravated Identity TheftRead the Press Release
Over $181,000 in Donations Stolen From Area Churches
B Kenneth James Stopkotte, 48, of Nashville, Tennessee, was indicted yesterday by a federal grand jury and charged with bank larceny, money laundering, access device fraud and aggravated identity theft, announced David Rivera, U.S. Attorney for the Middle District of Tennessee, and Todd Hudson, Special Agent in Charge, U.S. Secret Service.
According to the indictment, between August 27, 2012, and February 28, 2013, Stopkotte stole approximately $181,608.52 in donation checks from the mailboxes of numerous churches in the Nashville area. Stopkotte deposited the checks in accounts which he controlled at SunTrust Bank, First Tennessee Bank, Regions Bank, the Bank of Nashville and the Navy Federal Credit Union. Additionally, Stopkotte transferred approximately $70.000 of the stolen funds from these various bank accounts to an account that he controlled at USAA Federal Savings Bank. Stopkotte then laundered approximately $48,000 of the money by nine wire transfers in varying amounts into an account titled Black Marlin Industries located at the Federal Bank of the Middle East in Nicosia, Cyprus.
Also, according to the indictment, during the period of December 15, 2011, through January 19, 2012, Stopkotte used a credit card that had been issued to another person to charge approximately $13,631.45 in payments and other things of value, while using a means of identification of another person during the credit card transactions.
If convicted, Stopkotte faces a maximum penalty of 10 years in prison and a $250,000 fine on each of the bank larceny offenses, 20 years in prison and a $500,000 fine on each of the money laundering offenses, and 15 years in prison and a $250,000 fine on the access device charge. Additionally, Stopkotte faces a mandatory minimum sentence of two years on the aggravated identity theft charge which must be served consecutively to the prison term received for the access device offense.
This investigation was conducted by the U.S. Secret Service, the Murfreesboro, Tenn. Police Department, the Franklin, Tenn. Police Department, the Brentwood Tenn. Police Department and the Madeira, Ohio Police Department. Assistant U.S. Attorney Sandra G. Moses is representing the United States.
Charges brought by an indictment are merely accusations and are not evidence of guilt. The defendant has the right to a trial, at which, the government must bear the burden of proof beyond a reasonable doubt.
Mission Man Sentenced for Simple Possession of A Controlled SubstanceRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, man charged with Simple Possession of a Controlled Substance pled guilty and was sentenced on March 4, 2014, by U.S. Magistrate Judge Mark A. Moreno.
Steven Plank, age 29, was sentenced to 9 months of probation, a $1,000 fine, and $25 to the Federal Crime Victims Fund.
The conviction stems from an incident that took place on September 29, 2013, when Plank, who was working as a correctional officer at the Rosebud Sioux Tribe Adult Correctional Facility on the Rosebud Reservation, took a bottle of an inmate’s hydrocodone pills. The pills had been prescribed for the inmate by the Rosebud Indian Health Service Hospital. The hydrocodone pills that Plank stole from the inmate are a Schedule III controlled substance.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Mission Man Sentenced for Sexual Abuse of A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, man convicted of Sexual Abuse of a Minor was sentenced on March 4, 2014, by U.S. District Judge Roberto A. Lange.
Richard Peneaux, age 20, was sentenced to 18 months in custody, 5 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Peneaux was indicted by a federal grand jury on September 17, 2013. He pled guilty on December 11, 2013.
The conviction stems from an incident in August, 2013, when Peneaux was dating the victim, who had not attained the age of 16. Peneaux was aware that the victim was underage when he engaged in sexual intercourse with the victim.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Marie H. Ruettgers prosecuted the case. Peneaux was immediately turned over to the custody of the U.S. Marshals Service.
Mexican Citizen Sentenced to 70 Years for Holding Illegal Aliens at Gun Point in DesertRead the Press Release
TUCSON, Ariz. – On March 5, 2014, Isabel Perez-Arellanez, 43, of Guasave, Sinaloa, Mexico, was sentenced by U.S. District Chief Judge Raner C. Collinsto 70 years imprisonment. Perez-Arellanez was found guilty by a federal jury on Nov. 21, 2013 of one count of conspiracy to commit hostage taking, three counts of hostage taking, four counts of possession of a firearm during and in relation to a crime of violence, and one count of illegal alien in possession of a firearm.
This prosecution and sentence demonstrate that armed defendants who prey on vulnerable border crossers will be apprehended, and will face severe consequences for their actions,” said John S. Leonardo, U.S. Attorney.
“This man thought he could use the rugged mountains of Southern Arizona as a place to conduct violent crimes out of reach of the rule of law. Thanks to the dedicated work of the U.S. Border Patrol agents who arrested him and the HSI special agents who investigated this case, he will now spend decades in a federal prison,” said Matt Allen, special agent in charge of ICE Homeland Security Investigations (HSI) Arizona. “Finding and bringing these modern-day bandits to justice is a top priority for HSI and our law enforcement partners.”
In March of 2012, Perez-Arellanez and two co-defendants encountered two Mexican nationals and one Guatemalan national who had become lost and separated from their smuggling groups in the remote Tumacacori Mountains, approximately 50 miles south of Tucson. The defendant held the three victims at gun point for two to three days, forcing the victims to contact family members living in the United States to extort money from them. Once the victims’ family members wired between $900 and $1500 to the defendants’ Western Union accounts in Mexico, the defendant abandoned the victims in the desert without food and water. Eventually, the three victims made their way to Interstate 19 and reported the crime to Border Patrol who apprehended the defendants as they traveled southbound towards Mexico. At the scene of the apprehension, agents found a loaded 9mm pistol and personal effects belonging to the victims.The investigation in this case was conducted by U.S. Immigration and Customs Enforcement's Homeland Security Investigations (HSI) and the U.S. Border Patrol, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution was handled by Rui Wang and Matthew C. Cassell, Assistant U.S. Attorneys, District of Arizona, Tucson.
CASE NUMBER: CR-12-1025-TUC-RCC
RELEASE NUMBER: 2014-014_ Perez-ArellanezFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Maryland Man Pleads Guilty to Securities Fraud, Operated A Ponzi Scheme That Caused About $25 Million in LossesInvestment Scam Ran from 2006 to 2010, Then CollapsedRead the Press Release
WASHINGTON - Garfield M. Taylor, 55, of Rockville, Md., pled guilty today to a securities fraud charge stemming from operating a Ponzi scheme that resulted in investors losing approximately $25 million that they invested with Taylor and companies he controlled.
The plea was announced by Principal Assistant U.S. Attorney Vincent H. Cohen Jr., Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Chester A. McPherson, Interim Commissioner of the District of Columbia Department of Insurance, Securities, and Banking.
Taylor pled guilty in the U.S. District Court for the District of Columbia to securities fraud. The Honorable Chief Judge Richard W. Roberts scheduled sentencing for July 15, 2014. Under federal sentencing guidelines, Taylor faces a likely range of 151 to 188 months of incarceration, as well as a fine of up to $175,000. Under the plea agreement, he also must pay restitution to the victims of the scheme. The government maintains that these victims’ losses total, at least, $25,123,707. Finally, Taylor is subject to an additional forfeiture money judgment.
In a parallel action, the U.S. Securities and Exchange Commission obtained a civil judgment against Taylor for his fraudulent conduct.
“Today Garfield Taylor admitted to orchestrating a Ponzi scheme that left charities and families in our area with $25 million in losses,” said Principal Assistant U.S. Attorney Cohen. “Taylor used smoke-and-mirror tactics to make promises he could never keep and lied to investors about how he was using their money until the whole scam came crashing down. The years in prison he faces are a just punishment given the enormous financial harm his fraud inflicted on the residents of the District of Columbia.”
“By pleading guilty today, Mr. Taylor took responsibility for bilking clients out of more than $25 million by falsely leading them to believe that he was investing their hard-earned money in the way he promised he would,” said Assistant Director in Charge Parlave. “There is no safe harbor for criminals who commit securities fraud, and the FBI will continue to work with our federal, state and local partners to eradicate those who threaten the integrity of our financial markets.”
“This significant case involved a serious, complex type of securities fraud that impacted many people’s livelihoods, savings and investments. I applaud the joint efforts by the investigators in our department, the U.S. Attorney’s Office and the FBI to shut down this scheme that deceived many out of their hard earned money,” said Interim Commissioner McPherson. “Today’s plea demonstrates that defrauding investors in the District carries significant consequences.”
According to the government’s evidence, Taylor devised and employed a scheme from in or about September 2006 through in or about September 2010 in which he convinced investors to invest with him by promising them substantial returns on their investment, telling them that he used a sophisticated securities trading strategy that protected against loss, and claiming that he had a proven track record of using this strategy effectively.
During the course of this scheme, however, Taylor never used the trading strategy that he told investors that he would use. With the investments he did make during this period, Taylor either lost money or made minimal profits far below what was needed to pay the amounts he owed. The only way that Taylor was able to pay the substantial interest rates he was paying during this period was to use portions of the principal invested by new investors to pay amounts that were owed to earlier investors.
In one example from the government’s evidence, Taylor, in April 2010, used approximately half of an investor’s $425,000 investment to pay interest and principal that was due to earlier investors, rather than using those funds to invest in securities, as he had promised to do. Taylor paid only a portion of the interest payments he was required to pay the investor, before telling the investor that, because of trading losses, he was unable to make any more interest payments or to return the investor’s principal.
At the time of the scheme’s collapse, Taylor owed investors approximately $25 million just to cover the principal he was contractually required to return to them.
In announcing the plea, Principal Assistant U.S. Attorney Cohen, Assistant Director in Charge Parlave, and Interim Commissioner McPherson commended the work of those who investigated the case from the FBI’s Washington Field Office and the D.C. Department of Insurance, Securities and Banking. They also expressed appreciation to the U.S. Securities and Exchange Commission for its significant assistance. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Tasha Harris, L. Lenisse Edloe, and Shanna Hays; Litigation Technology Specialist Joseph Calvarese; Assistant U.S. Attorneys Matt Graves, Lionel André, and Catherine K. Connelly, who investigated and prosecuted the matter; and former Assistant U.S. Attorney Bridget Fitzpatrick, who investigated the matter.
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