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19 February 2014
Hudson County, N.J., Man Sentenced to 10 Years in Prison for Coercing A Minor to Engage in Sexual ActivityRead the Press Release
NEWARK, N.J. – A Hudson County, N.J. man was sentenced today to 120 months in prison for using video chat programs to persuade a minor girl to engage in sexual conduct, U.S. Attorney Paul J. Fishman announced.
Paul R. Kleinman, 34, of Jersey City, N.J. and Verona, N.J., previously pleaded guilty before U.S. Magistrate Judge Michael A. Hammer to an information charging him with coercing and enticing a minor to engage in sexual activity. U.S. District Judge Faith S. Hochberg imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Kleinman admitted that from September 2012 through October 2012, he communicated with a female minor through Skype and FaceTime applications on his tablet and computer. During these online communications, Kleinman instructed the minor to perform sexual acts on herself while he watched.
In addition to the prison term, Judge Hochberg sentenced Kleinman to seven years of supervised release.
U.S. Attorney Fishman credited special agents of the United States Department of Homeland Security, under the direction of Special Agent in Charge Andrew M. McLees, the Union County Prosecutor’s Office under the direction of Acting Prosecutor Grace Park, the Roselle Park Police Department under the direction of Chief Paul Morrison and the Royal Canadian Mounted Police under the direction of Commissioner Bob Paulson with the investigation leading to today’s sentencing.
The government is represented by Special Assistant U.S. Attorney Thomas S. Kearney of the U.S. Attorney’s Office General Crimes Unit in Newark.
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Defense counsel: Anthony Macula Esq., Nutley, N.J.
Houston Lawyer Charged with Bankruptcy FraudRead the Press Release
HOUSTON – Calvin C. Braun, a local Houston attorney who handles bankruptcy cases, has been arrested on charges of bankruptcy fraud and filing false declarations in bankruptcy court, announced United States Attorney Kenneth Magidson.
Braun was charged in four-count indictment returned Feb. 12, 2014. He was taken into custody yesterday and made an initial appearance before U.S. Magistrate Judge George C. Hanks. He was permitted release upon posting bond and was further ordered to not to take on any new bankruptcy cases.
The indictment alleges Braun, 47, filed a bankruptcy case under Chapter 7 on behalf of a woman on May 31, 2010, who agreed to pay Braun $2,500 to represent her. She had allegedly been referred to Braun by her ex-husband who had previously utilized the Orlando & Braun law firm to represent him on matters related to various companies he owned. On Dec. 23, 2010, the man had retained Braun to file a Chapter 11 bankruptcy case in his behalf, according to allegations. The indictment further alleges the woman had been listed as a creditor in the documents filed in her ex-husband’s case.
Braun allegedly falsely filed a Disclosure of Compensation of Attorney on behalf of the woman in bankruptcy court in which he certified he had received his full fee of $2,500 prior to filing the disclosure statement on July 2, 2010. However, the indictment alleges he knew she had not paid the full amount owed when he filed the statement and he continued to collect money from her in the case.
Later, Braun also allegedly filed an Application to Employ with an attached affidavit seeking the bankruptcy court’s approval to represent the man in his Chapter 11 case. In that affidavit,Braun allegedly stated he had no conflict of interest in representing him nor represented any of his creditors. The woman filed an objection to that application. Braun later admitted in an amended affidavit that he did represent the woman in her Chapter 7 case, but again reiterated he did not represent any creditors of the male, according to the allegations. However, in truth and in fact according to the indictment, he was counsel of record for her and that she was listed as a creditor in the man’s Chapter 11 bankruptcy case.
Furthermore, on Nov. 30, 2010,Braun allegedly charged the woman an additional fee of $300 and promised to file a motion to re-open her bankruptcy case which had been closed due to Braun’s failure to file a critical document. Later, on Dec. 28, 2010, the woman paid an additional $1,258.91 for the balance owed Braun to re-open the case. He took the money in both instances, but never filed the motion to re-open the case, even though he was still her counsel of record, according to the allegations.
If convicted of the charges, Braun faces up to five years in federal prison and a possible $250,000 fine.
FBI investigated with the assistance of the United States Trustee’s Office. Assistant United States Attorney Quincy L. Ollison is prosecuting.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Henderson, Nev. Man Charged with Aiming Laser Pointer at Police HelicopterRead the Press Release
LAS VEGAS, Nev. - A Henderson, Nev. man has been indicted by the federal grand jury for aiming a laser pointer at a Las Vegas Metropolitan Police Department (LVMPD) helicopter on six occasions during January and February 2014, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
James David Zipf, 30, is charged with six counts of aiming a laser pointer at an aircraft on Jan. 30, Jan. 31, Feb. 3, Feb. 7, Feb. 8, and Feb. 12, 2014, and is scheduled to appear before United States Magistrate Judge Nancy J. Koppe, at 3:00 p.m. today for an initial appearance and arraignment and plea. If convicted, Zipf faces up to five years in prison and a fine of up to $250,000 on each count.
“Congress enacted a new federal statute in 2012 dealing with laser strikes, which makes it a felony to knowingly target an aircraft with a laser,” said U.S. Attorney Bogden. “We have partnered with our local, state and federal law enforcement agencies to catch individuals who are engaging in this dangerous behavior, which can disorient and temporarily blind a pilot. If you have information about a lasing incident or see someone pointing a laser at an aircraft, call your local FBI field office or dial 911.
Since the FBI and the Federal Aviation Administration (FAA) began tracking laser strikes in 2005, statistics reflect a more than 1,100 percent increase in the deliberate targeting of aircraft by people with handheld lasers. In 2013, there were a total of 3,960 laser strikes reported—an average of almost 11 incidents per day.
This case is being investigated by the FBI and LVMPD, and prosecuted by Assistant U.S. Attorney Roger Yang.The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Gulfport Woman Sentenced for Deepwater Horizon Oil Spill FraudRead the Press Release
Gulfport, Miss. – Kimberly Marie Isabell, 33, of Gulfport, was sentenced today by U. S. District Judge Sul Ozerden to three years on probation and six months home confinement with electronic monitoring for mail fraud in connection with the Deepwater Horizon Oil Spill, U.S. Attorney Gregory K. Davis announced. Isabell was also ordered to pay restitution in the amount of $17.000.00.
Isabell pled guilty on October 22, 2013 to knowingly devising and carrying out a scheme to defraud the Gulf Coast Claims Facility (the “GCCF”) which was established by BP Exploration and Production, Inc., to administer, process, and settle certain claims of individuals and businesses that had been impacted by the Deepwater Horizon Oil Spill. Isabell made false representations in her claim for damages by alleging that she lost earnings, profits and work hours from her job at Isabell Janitorial Services in Gulfport due to the Deepwater Horizon Oil Spill. As a result of her scheme, Isabell received a check from the Claims Facility totaling $12,000.
The case was investigated by the U.S. Secret Service and prosecuted by Assistant U.S. Attorney Andrea Jones.
This case was brought as part of this District’s partnership with the National Center for Disaster Fraud (NCDF), a nationwide initiative to protect available funds and assistance for those victims of both natural and man-made disasters such as hurricanes, floods, tornadoes and the recent Gulf oil spill. If you have knowledge of fraud, waste, abuse, or allegations of mismanagement involving disaster relief operations, you can contact the NCDF by either calling the hotline at (866) 720-5721, faxing (225) 334-4707, emailing at [email protected] or in writing to National Center for Disaster Fraud, Baton Rouge, LA 70821-4909.If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
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Grand Jury Returns Indictment Charging Pair with Possession of Methamphetamine with Intent to DistributeRead the Press Release
More Than 16 Pounds Of Meth, 2.42 Pounds Of Heroin Found In CarSALT LAKE CITY - A federal grand jury returned an indictment Wednesday afternoon charging two individuals from the Los Angeles area with possession of methamphetamine with intent to distribute. Charged in the indictment are Miriam Machado, age 36, and Benito Urbina, age 33.
Machado and Urbina were arrested Feb. 9, 2014, following a traffic stop by the Utah Highway Patrol in Salt Lake County. A Unified Police Department K-9 officer responded to the traffic stop which resulted in a positive indication of illegal narcotics in the vehicle. Upon further investigation, officers discovered a hidden compartment filled with numerous bags of an unknown substance that field tested positive for methamphetamine and heroin. According to a complaint filed in the case, the total weight of the meth was 16.1 pounds and the approximate weight of the heroin was 2.42 pounds.
According to the complaint, during subsequent interviews, Machado and Urbina admitted transporting illegal contraband in the vehicle and being compensated for transporting the contraband from the Los Angeles area to Salt Lake City
Machado’s 5-year-old daughter, who was in the car when the traffic stop was executed, was turned over to Child Protective Services.
The potential maximum penalty for possession of methamphetamine with intent to distribute 500 grams or more is up to life in prison with a minimum mandatory sentence of 10 years. Machado and Urbina, who are in federal custody pending resolution of the case, are scheduled for an initial appearance on the indictment Thursday at 10:30 a.m. in U.S. Magistrate Judge Dustin Pead’s courtroom.
Indictments are not findings of guilt. Individuals charged in indictments are presumed innocent unless or until proven guilty in court.
The case is being investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations special agents, the Utah Highway Patrol, and the Unified Police Department.
Government Intervenes in Lawsuit Against Tenet Healthcare Corp. and Georgia Hospital <br /> Owned by Health Management Associates Inc. Alleging Payment of KickbacksRead the Press Release
The government has intervened in a False Claims Act lawsuit against Tenet Healthcare Corp. (Tenet) and four of its hospitals in Georgia and South Carolina, as well as a hospital in Monroe, Ga., owned by Health Management Associates Inc. (HMA), alleging that the hospitals paid kickbacks to obstetric clinics serving primarily undocumented Hispanic women in return for referral of those patients for labor and delivery at the hospitals. The hospitals then billed the Medicaid programs in Georgia and South Carolina for the services provided to the referred patients and, in some instances, also obtained additional Medicare reimbursement based on the influx of low-income patients. Tenet and HMA are two of the largest owner/operators of hospitals in the United States. HMA was acquired by Community Health Systems last month. The government also is intervening against the clinics and related entities known as Hispanic Medical Management d/b/a Clinica de la Mama.
“The Department of Justice is committed to ensuring that health care providers who pay kickbacks in return for patient referrals are held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “Schemes such as this one corrupt the health care system and take advantage of vulnerable patients.”
“My office has made the investigation of health care fraud a priority,” said U.S. Attorney for the Middle District of Georgia Michael J. Moore. “In a time when too many people were struggling to get health care for themselves and their children, Tenet and these hospitals plundered a system set up for those truly in need. This kind of scheme drives up costs for everyone, not just the vulnerable patients and groups like those targeted in this case.”
The lawsuit alleges that four Tenet hospitals, Atlanta Medical Center, North Fulton Regional Hospital, Spalding Regional Hospital and Hilton Head Hospital in South Carolina, and one HMA facility, Walton Regional Medical Center (since renamed Clearview Regional Medical Center), paid kickbacks to Hispanic Medical Management d/b/a Clinica de la Mama (Clinica) and related entities in return for Clinica’s agreement to send pregnant women to their facilities for deliveries paid for by Medicaid, in violation of the federal Medicare and Medicaid Anti-Kickback Statute. The kickbacks were disguised as payments for a variety of services allegedly provided by Clinica.
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs. The Anti-Kickback Statute is intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.
“Investigations such as these are a high priority for the FBI, and we are determined to hold accountable providers that enrich themselves at the expense of government programs and damage the public trust,” said FBI Assistant Director Ronald T. Hosko. “The FBI is dedicated to preventing and combating all forms of health care fraud; working with federal, state and local partners to effectively resolve allegations and engaging with the public to identify potential schemes.”
The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they believe that defendants submitted false claims for government funds and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done in this case. The lawsuit is pending in the Middle District of Georgia .
The government’s intervention in this matter illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $19 billion through False Claims Act cases, with more than $13.4 billion of that amount recovered in cases involving fraud against federal health care programs.
These matters were investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division, the Fraud Section of the department’s Criminal Division, the U.S. Attorney’s Offices for the Middle and Northern Districts of Georgia, the Department of Health and Human Services Office of Inspector General, the Federal Bureau of Investigation and the Office of the Attorney General for the State of Georgia.
The case is captioned United States ex rel. Williams v. Health Mgmt. Assocs. Inc., Tenet Healthcare, et al., No. 3:09-CV-130 (M.D. Ga.).
The claims asserted against Tenet, the HMA facility and Clinica are allegations only, and there has been no determination of liability.
Georgia Court of Appeals Chief Judge Phipps Addresses United States Attorney's OfficesRead the Press Release
As part of their commemoration of Black History Month, the staff of the United States Attorney’s offices in Macon, Albany and Columbus enjoyed a presentation by Georgia Court of Appeals Chief Judge Herbert Phipps.Judge Phipps opened his presentation with a quote from Helen Keller, “The world is moved not only by the mighty shoves of the heroes, but also by the aggregate of the tiny pushes of each honest worker.” He then proceeded to relate stories about the unknown honest workers who toiled and sacrificed during the civil rights struggle in the South.
Judge Phipps spoke of watching trials during his teenage years in the state and federal courthouses. He related incidents where court security officers tried to keep him from entering the courthouse and the racial slurs and other abuses he witnessed of black defendants and witnesses.
While in college, Judge Phipps was active with the Student Nonviolent Coordinating Committee and the Southern Christian Leadership Conference during the civil rights movement. He told of an incident where he was working on voter registration in Albany, Georgia and was jailed for several days in a cell next to Dr. Martin Luther King. Judge Phipps’ only crime was being in a phone booth at night. He was never charged and was ultimately released. Dr. King shared the meals, brought to him by church ladies, with Judge Phipps.
Judge Phipps spoke of C.B. King, his former law partner. Today, the Federal Courthouse in Albany, Georgia is named for him although Mr. King was not allowed to go to law school in Georgia because he was black.
His final illustration of tiny shoves by honest workers was of an uneducated sharecropper and civil rights pioneer from Mississippi named Fannie Lou Hamer. She took the risk of many acts of civil disobedience during the 60’s and, when asked about the risk said, “If I fall, I will fall 5 feet 4 ½ inches forward in the journey for equal justice.”
“Black History Month is a time for us not only to reflect on the past; it is a time to remember and honor the many unsung heroes who literally risked everything in the pursuit of equal rights. As I listened to Judge Phipps, I was inspired by his courage and reminded that each of us, in our own way, is responsible for continuing the commitment to equal justice for everyone,” said United States Attorney Michael Moore.
Inquiries regarding the case should be directed to Pamela Lightsey, United States Attorney's Office at (478) 621-2603.
Four Men Indicted for Armed Robbery of Armored Truck EmployeesRead the Press Release
Allegedly Stole Over $79,000 and Attempted to Murder a Witness Who Called 911
Greenbelt, Maryland - A federal grand jury indicted four defendants today on charges arising from the armed robbery of employees who were transporting money in an armored truck:
Antonio Lamar Cooper, age 27, of Washington, D.C.; Juwan Armarni Watkins, age 21, of Washington, D.C.; Maurice Lorenzo Foreman, age 22, of Oxon Hill, Maryland; and
Eugene Robert Watkins, age 22, of Washington, D.C.The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Chief Mark A. Magaw of the Prince George’s County Police Department; Chief Cathy L. Lanier of the Metropolitan Police Department; and Prince George’s County State’s Attorney Angela D. Alsobrooks.
According to the three count indictment and court documents, on January 15, 2014 the defendants stole a vehicle and drove it to a restaurant on Allentown Road in Morningside, Maryland. Outside the restaurant, two armored truck employees were transporting money from the restaurant. One of the defendants pointed a gun at an employee’s face, pushed her to the ground, placed his gun on the back of her head and took her gun. Another defendant pointed his gun at the second employee’s head and took his gun as well.
The indictment and court documents allege that the defendants robbed the employees of $74,106 in cash, $4,028 in checks, a scanner and a printer. During their escape into Washington D.C., the defendants allegedly shot at a witness to the robbery who called a 911 dispatcher and followed the defendants in a high speed chase to obtain the license number of their getaway vehicle. The defendants shot the driver’s side window of the witness’s car several times.
According to court documents, Prince George’s County Police officers pursued the defendants’ stolen vehicle into Washington, D.C. where the defendants got out of their vehicle and attempted to flee. With the assistance of a canine search initiated by Metropolitan Police officers, the defendants were subsequently arrested.
The defendants face a maximum sentence of 20 years in prison for the conspiracy and for interfering with interstate commerce by robbery; and life in prison for using a firearm during the robbery. All of the defendants but Foreman have had their initial appearances in U.S. District Court in Greenbelt and are detained. Foreman is in state custody.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein commended the FBI, Prince George’s County Police Department, Metropolitan Police Department and Prince George’s County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys William D. Moomau and Bryan E. Foreman, who are prosecuting the case.
Four in U.S. Attorney’s Office for Eastern District of California to Receive California Lawyer Magazine’s Attorney of the Year AwardsRead the Press Release
SACRAMENTO, Calif. — California Lawyer magazine has named four attorneys in the United States Attorney’s Office for the Eastern District of California to receive its California Lawyer Attorneys of the Year Awards, United States Attorney Benjamin B. Wagner announced. The attorneys being honored are: Assistant U.S. Attorney Colleen Kennedy; Kelli L. Taylor, who is Chief of the office’s Affirmative Civil Enforcement Unit; and David T. Shelledy, who is Chief of the office’s Civil Division; as well as the U.S. Attorney himself. The awards are presented each year to members of the California bar whose work has had significant impacts in the previous year.
California Lawyer identified as the basis for the awards the work of the U.S. Attorney’s office in investigating JPMorgan Chase over toxic mortgage debt, and in spearheading talks that led to a $13 billion fraud settlement last November with the bank. It was the largest settlement by the U.S. Department of Justice with a single entity in American history, and resolved federal and state civil claims arising out of the packaging, marketing, sale and issuance of residential mortgage-backed securities by JPMorgan, Bear Stearns and Washington Mutual prior to January 1, 2009. It required JPMorgan to pay $2 billion to the U.S. Department of Justice in connection with the allegations asserted by the U.S. Attorney’s Office, plus $7 billion total to five states and three federal agencies, and an additional $4 billion worth of relief to homeowners and to neighborhoods impacted by the financial crisis that began in 2008.
The U.S. Attorney’s Office investigation was conducted with assistance from special agents with the Federal Housing Finance Administration’s Office of Inspector General, and in conjunction with the Residential Mortgage-Backed Securities Working Group, a component of the Financial Fraud Enforcement Task Force. The Task Force was established by President Obama in 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. For more information on the task force, please visit www.StopFraud.gov.
Fort Kent Man Pleads Guilty to Stealing DrugsRead the Press Release
Contact: Jim Moore
Assistant United States Attorney
Tel: (207) 945-0373
Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Roland
Roy, Jr., 51, of Fort Kent, Maine pled guilty today in United States District Court to stealing
Hydrocodone.According to court records, Roy was a pharmacy technician at Northern Maine Medical
Center (NMMC) when NMMC realized that a large quantity of Hydrocodone pills were missing from its pharmacy. The investigation revealed that Roy ordered large quantities of Hydrocodone pills and then stole more than $1,000 worth of them. Roy admitted to NMMC’s human resources director that he had taken a majority of the missing pills.Roy faces up to 10 years in prison and a $250,000 fine, or both. He will be sentenced after completion of a presentence investigation report by the United States Probation Office.
The investigation was conducted by the Office of Inspector General of the U.S.
Department of Health and Human Services.Former Teacher Sentenced on Child Pornography ConvictionRead the Press Release
LAREDO, Texas – Jorge Valadez, 53, a former high school teacher in Laredo, has been handed a 52-month prison term for possessing child pornography on his computer, announced United States Attorney Kenneth Magidson. He pleaded guilty Nov. 13, 2013, to possessing four videos of child pornography between June 1, 2013, and Sept. 13, 2013.
Senior U.S. District Judge George Kazen handed down the sentence which will be followed by 10 years of supervised release. He will also be required to register as a sex offender.
Valadez was sharing his computer’s files on a peer-to-peer network. An investigator was able to download two complete and two partial videos tracked to Valadez for examination.
Federal authorities executed search and seizure warrants for Valdez his home, automobile, computers and electronic storage devices on Sept. 13, 2013. At that time, Valadez agreed to speak with the agents and admitted he had downloaded child pornography videos and images over the prior five years out of curiosity, adding that he was unsure of how many videos he had actually downloaded.
Agents located four videos containing child pornography on his computer. Valadez further admitted he had his computer “cleaned” shortly before the encounter with federal authorities.
Valadez will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The investigation was conducted by the Webb County Sheriff’s Department and Homeland Security Investigations. Assistant United States Attorneys Jose Homero Ramirez and Sonah Lee prosecuted the case.
Former Shelby County Residents Guilty in Health Care Fraud SchemeRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A Center, Texas couple now living in Elgin, Texas, has pleaded guilty to federal violations in a health care fraud scheme in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
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Cathy Harvill, 57, and William Harvill, also known as Bill Harvill, 60, pleaded guilty to conspiracy to commit health care fraud on Feb. 18, 2014, before U.S. Magistrate Judge Keith Giblin..
According to information presented in court, the Harvills owned and operated North East Texas EMS. From January 2007 through March 2012, the defendants carried out a scheme to defraud Medicare and Medicaid by submitting false and fraudulent claims for nonemergency, scheduled, repetitive ambulance services which did not meet Medicare program coverage criteria.
The defendants each face up to 10 years in federal prison at sentencing. Sentencing dates have not been set.
This case is being investigated by the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG), the Texas Office of the Attorney General – Medicaid Fraud Control Unit (OAG-MFCU), and the U.S. Department of Labor – employee Benefits Security Administration (DOL-EBSA). This case is being prosecuted by Assistant U.S. Attorneys Nathaniel C. Kummerfeld and Tom Gibson and Special Assistant U.S. Attorney Kenneth C. McGurk.Former Plymouth Police Officer Convicted of Using Excessive Force and LyingRead the Press Release
BOSTON - A former Plymouth police sergeant was convicted today of using excessive force on an arrestee and covering up his actions by falsifying police reports related to the incident.
After three hours of deliberation, a jury convicted Shawn Coughlin, 47, of deprivation of constitutional rights under color of law and falsifying a record to impede a federal investigation.
On Nov. 19, 2011, at the Plymouth police station, Coughlin assaulted an arrestee who was in a holding cell and handcuffed behind his back. Coughlin struck the arrestee in the head and kneed him in the body, resulting in bodily injury. Evidence at trial also established that Coughlin falsified the official police incident reports regarding the incident.
“A critical component of effective law enforcement is trust,” said US Attorney Carmen M. Ortiz. “Quality policing cannot exist if citizens can’t trust that the police who are sworn to protect them use excessive force and lie about their actions. It is very important to our entire system of justice that individuals who violate that trust are held accountable.”
“This investigation shows that the FBI, Plymouth Police and the United States Attorney’s Office places a high-priority on investigating civil rights violations including violations by those sworn to protect and serve. The FBI was proud to work with the Plymouth Police Department and the United States Attorney’s Office on this investigation to ensure that justice was served. Nothing justifies or excuses Mr. Couglin’s actions because it is never acceptable to break the law in order to enforce it,” said Vince Lisi, Special Agent in Charge of the FBI.
Sentencing is scheduled for May 20, 2014. Coughlin faces up to 10 years in prison to be followed by three years of supervised release and a $250,000 fine on the civil rights conviction. Coughlin faces up to 20 years in prison to be followed by three years of supervised release and a $250,000 fine on the obstruction conviction.
United States Attorney Ortiz and FBI Special Agent in Charge Lisa made the announcement today. The case is being prosecuted by S. Theodore Merritt and Kristina E. Barclay of Ortiz’s Civil Rights Enforcement Team.
Former Marlborough Resident Pleads Guilty to Robbing Five Connecticut PharmaciesRead the Press Release
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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that DAVID HANEY, 52, of Marlborough, waived his right to indictment and pleaded guilty today before U.S. District Judge Stefan R. Underhill in Bridgeport to robbing five Connecticut pharmacies last year.
On November 22, 2013, HANEY was arrested on a criminal complaint charging him with the armed robbery of a CVS store located at 525 Buckland Road in South Windsor. At approximately 7:45 p.m. on September 25, 2013, HANEY entered the store and proceeded to the pharmacy counter. He then asked for the pharmacist by name, showed the pharmacist a firearm that was in his waistband and demanded oxycodone pills. The pharmacist gave HANEY more than 2000 oxycodone pills of different strengths and HANEY exited the store.
HANEY pleaded guilty today to one count of interference with commerce by robbery related to the South Windsor CVS robbery. In pleading guilty, HANEY also admitted that he committed similar robberies at a Walgreens on Deming Street in Manchester on September 15, 2013, a Walgreens on Main Street in Meriden on October 3, 2013, a CVS on Main Street in East Hartford on October 11, 2013, and a Walgreens on Talcottville Road in Vernon on November 9, 2013.
Judge Underhill has scheduled sentencing for May 14, 2014, at which time HANEY faces a maximum term of imprisonment of 20 years.
HANEY has been detained since his arrest.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Drug Enforcement Administration and the South Windsor, East Hartford, Meriden, Vernon, and Manchester Police Departments, with the assistance of other state and local law enforcement agencies. This case is being prosecuted by Assistant U.S. Attorney Anthony E. Kaplan.
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(203) 821-3722 [email protected]Former Exec Sentenced to 10 Years in Prison for Brokering $30M in Fraudulent Mortgage LoansRead the Press Release
PITTSBURGH - A resident of Finleyville, Pa., has been sentenced in federal court to ten years of imprisonment on his conviction of wire fraud conspiracy, United States Attorney David J. Hickton announced today.
Chief United States District Judge Joy Flowers Conti imposed the sentence yesterday on David McCloskey, 49.
According to information presented to the court, McCloskey operated a mortgage broker company called First Atlantic Financial that brokered more than $30 million worth of fraudulent loans. The loans were fraudulent because the loan applications contained false representations related to the borrowers’ income and assets, which were supported by bogus documents prepared by McCloskey and his co-conspirators. Fraudulent appraisals were also part of McCloskey's conspiracy. Most of the fraudulent appraisals were prepared by co-conspirator Kenneth Cowden, who was not licensed to prepared appraisals. His appraisals also drastically overstated the values of the properties serving as collateral for the loans.
Assistant United States Attorney Brendan T. Conway prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Mortgage Fraud Task Force for the investigation leading to the successful prosecution of McCloskey.
The Mortgage Fraud Task Force is comprised of investigators from federal, state and local law enforcement agencies and others involved in the mortgage industry. Federal law enforcement agencies participating in the Mortgage Task Force include the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigations; the United States Department of Housing and Urban Development, Office of Inspector General; the United States Postal Inspection Service; and the United States Secret Service. Other Mortgage Fraud Task Force members include the Allegheny County Sheriff's Office; the Pennsylvania Attorney General's Office, Bureau of Consumer Protection; the Pennsylvania Department of Banking; the Pennsylvania Department of State, Bureau of Enforcement and Investigation; and the United States Trustee's Office.
Former Detroit Liquor Store Owner Sentenced for Tax Fraud and for Selling Cutting Agents to Drug DealersRead the Press Release
Bashar Saroki, a resident of Southfield, Mich., was sentenced today in the U.S. District Court for the Eastern District of Michigan to serve 30 months in prison to be followed by one year of supervised release, the Justice Department and the Internal Revenue Service (IRS) announced. Previously, Saroki pleaded guilty to filing a false 2009 tax return and offering drug paraphernalia for sale.
According to court documents, Saroki controlled and operated Golden Star Party Store, a liquor store that was located in Detroit. From 2007 through 2011, Saroki sold more than $1 million worth of a variety of cutting agents to local narcotics dealers out of Golden Star Party Store and from his residence. Narcotics dealers used these cutting agents to dilute the potency and increase the quantity of the narcotics they sold to customers. Saroki also filed a false tax return for 2009 that reported very little income despite the significant proceeds from the sale of cutting agents.
Assistant Attorney General Kathryn Keneally for the department's Tax Division commended the efforts of special agents of IRS-Criminal Investigation, who investigated this case, and Tax Division Trial Attorneys Kenneth C. Vert and Yael T. Epstein, who prosecuted the case.
Former Cook County Commissioner Moreno Sentenced to 11 Years in Prison for Series of Public Corruption SchemesRead the Press Release
CHICAGO — Former Cook County Commissioner JOSEPH MARIO MORENO was sentenced today to 11 years in federal prison for engaging in a series of public and personal corruption schemes over a span of three years. Moreno pleaded guilty on July 1, 2013, to conspiracy to commit extortion after he was initially charged in late June 2012, about 18 months after he left public office.
Moreno, 61, of Chicago, a lawyer who served more than 16 years as an elected county commissioner until December 2010, was sentenced to 132 months in prison, and he was ordered to forfeit $100,000 and pay a total of more than $138,000 in restitution by U.S. District Judge Gary Feinerman. Moreno was ordered to begin serving his sentence on April 21.
“Mr. Moreno was not a reluctant participant in these schemes; he was an eager participant,” Judge Feinerman said, adding that Moreno “embraced them with gusto and pursued them with vigor.”
Moreno “repeatedly pursued his own interests at the expense of those he was supposed to serve. . . . [H]e extorted a reputable business and corrupted the highest levels of Cook County government, the Town of Cicero, and a private hospital. He also evaded taxes and suborned perjury so he could reduce his child support obligations. And when he was confronted about his crimes, he obstructed justice by providing the government with false invoices in an effort to conceal his criminal conduct,” Assistant U.S. Attorneys Christopher J. Stetler and Megan C. Church wrote in a government sentencing memo.
Notably, they argued, Moreno conceived a motto of governing that captured his corrupt approach to public office: “I don’t want to be a hog. I just want to be a pig. Hogs get slaughtered. Pigs get fat.”
Moreno pleaded guilty to conspiracy to extort an un-named company that was awarded a contract to help improve Cook County Hospital’s revenue cycle into using his friend and codefendant, Ron Garcia, and his business, Chicago Medical Equipment & Supply, Inc., as a minority subcontractor in return for a $100,000 bribe. Garcia forgave a $100,000 mortgage loan to Moreno in exchange for Moreno’s efforts to steer the lucrative sub-contract to Garcia’s company, and Moreno tried to disguise the bribe by claiming that he had repaid the purported loan.
In pleading guilty, Moreno also agreed that he sought to obtain orders of Dermafill bandages from Cook County in return for kickbacks while he and his staffer, co-defendant and former Chicago Ald. Ambrosio Medrano, were Cook County officials; sought to obtain approval for a waste-transfer station in return for kickbacks while a Town of Cicero official; and evaded his federal income taxes between 2007 and 2010 by misreporting the income from his law office.
According to sentencing documents, between 2008 and 2010, Moreno engaged in those schemes, as well as five other schemes to:
- enrich himself through kickbacks in return for passing a “green” resolution while a Cook County Commissioner;
- obtain medical-transcription business from Cook County in return for kickbacks concealed as legal fees;
- obtain orders of Dermafill bandages from a private hospital by bribing a hospital official;
- enrich himself through kickbacks while a Town of Cicero official;
- reduce his child-support obligations by suborning perjury during a court hearing.
Medrano, 60, of Chicago, the former alderman who later worked on Moreno’s county staff, was sentenced last month to a total of 13 years in federal prison after pleading guilty in one case involving Moreno and being convicted at trial last year in a separate corruption case that stemmed from the same FBI undercover investigation.
Garcia, 54, of Homer Glen, and two other co-defendants, Gerald W. Lombardi, 61, of Darien, and his son, Jerry A. Lombardi, 34, of Downers Grove, who were agents of Chasing Lions, LLC, a disabled-veterans-owned business in Lisle that sold the Dermafill bandages, pleaded guilty to their roles in the scheme and are awaiting sentencing. A sixth co-defendant, Stanley Wozniak, 51, of Chicago, is awaiting the disposition of charges.
The Moreno sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and James C. Lee, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division.
Former Attorney Pleads Guilty to Securities and Bank FraudRead the Press Release
ANNISTON -- A former Birmingham attorney pleaded guilty today in federal court to charges connected with a securities fraud scheme involving the fraudulent taking of more than $2.8 million dollars in investment funds, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr. and Alabama Securities Commission Director Joseph Borg.CHRISTOPHER SHAWN LINTON, 34, of Alabaster, entered his plea before U.S. District Judge Virginia Emerson Hopkins to one count each of wire fraud, mail fraud, securities fraud and money laundering as part of the investment fraud scheme. He also pleaded guilty to one count of bank fraud arising out of the submission of a fraudulent commercial loan application to Iberia Bank for a loan of $908,650.
As part of his plea agreement, Linton is required to pay $2.5 million in restitution to the investors he defrauded, and to pay restitution to Iberia Bank in an amount that will be determined at sentencing. Sentencing is scheduled May 29.
"This Commission is proud to be able to combine our efforts and resources with those of the U.S. Attorney's Office, Northern District of Alabama, and the FBI, to achieve a just and strong conviction against Linton," Borg said. "Hopefully, this verdict will provide some relief to victims involved in this case who were defrauded out of their hard-earned dollars."
According to Linton's plea agreement, he conducted the securities fraud scheme as follows:
In 2007, Linton became an officer, partner and part owner of a business known as Integrity Capital Inc., by purchasing stock in the company. Integrity Capital Inc. was a factoring business located in the greater Birmingham area. Its business was to make advance payments to lawyers who had submitted payment vouchers for work performed for the State of Alabama. Integrity Capital would then receive the voucher payments from the state and keep a percentage as a fee.
In 2009, Linton formed Integrity Capital LLC. Beginning about August 2009, Linton recruited investment advisors to solicit investments in Integrity Capital LLC, in order to purchase the assets and capital stock of Integrity Capital Inc. Between September 2009 and December 2011, 12 individuals invested more than $2.8 million in Integrity Capital LLC. The investors mailed, wired or delivered money to Linton, who deposited the money into one of several bank accounts held by the law firm where he was a partner.
After receiving the investor funds, Linton fraudulently converted them for personal use by writing personal checks to himself and by using the funds for non-investment purposes. The non-investment purposes included, but were not limited to, the purchase of his personal residence, construction projects at the residence, private jet flights, vacations, recreational vehicles, furniture, luxury items, Auburn football tickets and a donation to the Heisman Trophy Trust.
Linton committed bank fraud in January 2012 when he submitted fraudulent personal financial statements to Iberia Bank and received two commercial loans totaling $908,650, according to his plea agreement. His financial statements inflated the value of his personal residence and falsely stated that he owned the residence and other real property.
The maximum penalty for wire fraud and for mail fraud is 20 years in prison and a $250,000 fine; the maximum penalty for money laundering is 10 years in prison and a $250,000 fine; and the maximum penalty for securities fraud is five years in prison and a $250,000 fine. The maximum penalty for bank fraud is 30 years in prison and a $1 million fine.
The FBI and Alabama Securities Commission investigated the case, which Assistant U.S. Attorney Robin Beardsley Mark is prosecuting along with Assistant Attorney General Greg Biggs with the Alabama Securities Commission.Firearms Enforcement: Two Cases Highlight DOJ Priority FocusRead the Press Release
A repeat offender who robbed a postal contract facility was sentenced last week to ten years in prison, announced U.S. Attorney Jenny A. Durkan. A few days later a separate defendant was convicted by a Tacoma jury of being a felon in possession of a firearm. Both cases highlight the focus on illegal weapons possession that is a priority in the Western District of Washington.
In the first case, CHAUNCEY WILLIAMS, 25, of Lakewood, Washington was sentenced to the ten year prison term for armed robbery and brandishing a firearm during a crime of violence. WILLIAMS is one of three men who robbed the Oakbrook Contract Postal Unit in Lakewood on June 7, 2011. The men pointed a gun at the clerk and demanded the money in the till. WILLIAMS was convicted by a jury on January 24, 2013. At the sentencing Monday, February 10, 2014, Judge Benjamin H. Settle said that “Nobody in this courtroom can understand the trauma of having a gun held to them in a robbery… (it was) that conduct that brought great harm to others.” WILLIAMS was identified as one of the robbers after cashing a money order taken in the robbery while on a trip to Hawaii.
In the second case, CARLOS CARMONA-GONZALEZ, 23, of Vancouver, Washington, was convicted Wednesday, February 12, 2014, of being a felon in possession of a firearm. The two day trial revealed that, in July 2013, CARMONA-GONZALEZ was seen by three police officers and one civilian eyewitness, placing a rifle wrapped in a jacket in his friend’s car. CARMONA-GONZALEZ is a prominent member of the Surenos gang in the Southwest Washington region. CARMONA-GONZALEZ is prohibited from possessing firearms because he has four previous felony convictions, including possession of MDMA (Clark County 2011), attempted assault (Clark County 2009), Escape (Clark County 2008) and assault (Clark County 2008). When sentenced by U.S. District Judge Ronald B. Leighton on May 23, 2014, CARMONA-GONZALEZ faces up to ten years in prison.
The WILLIAMS case was investigated by the U.S. Postal Inspection Service (USPIS) and the Lakewood Police Department. The case was prosecuted by Assistant United States Attorneys Gregory A. Gruber and David Reese Jennings.
CARMONA-GONZALEZ was investigated by the Longview Police Department and the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) with assistance from the Vancouver Police Department. The case was prosecuted by Assistant United States Attorneys Roscoe Jones and Jill Otake.
Final Defendant Pleads Guilty to Wire Fraud and Money Laundering as Part of A $5 Million Ponzi SchemeRead the Press Release
DENVER – Stanley W. Anderson, age 69, of Arvada, Colorado pled guilty before U.S. District Court Judge Christine M. Arguello late last week to one count of wire fraud and one count of money laundering, federal law enforcement announced. Anderson, who is free on bond, is scheduled to be sentenced by Judge Arguello on May 6, 2014. Anderson was indicted by a federal grand jury in Denver on March 22, 2012, along with co-defendants Pastor Charles Lawrence Kennedy, Jr. of Tampa, Florida and Edwin Alexander Smith of Denver, Colorado. Kennedy and Smith pled guilty and were sentenced to twelve and thirty months, respectively, to federal prison.
According to the facts contained in the indictment as well as the stipulated facts contained in the various plea agreements, beginning in October of 2005 and continuing through December 2008, Anderson, Smith and Kennedy together with each other, and aiding and abetting other persons known and unknown to the Grand Jury, devised a scheme to defraud investors.
Anderson and Smith resided in Colorado and conducted business through “CFO-5, LLC” and “Trinity International Enterprises, Inc”, two companies they controlled. Trinity had no business operations apart from soliciting investment funds related to an investment program. Anderson was the chairman and chief executive officer of CFO-5 and Trinity. Smith was the secretary of CFO-5 and president of Trinity. Kennedy resided in Florida where he worked as a pastor and conducted business through a company identified as “Keys to Life Corporation". Kennedy through a formal partnership with Trinity assisted Anderson and Smith in soliciting investment funds.
They solicited investors' funds for use in an investment program where significant profits would supposedly be generated through the trading of European medium term notes ("MTN program"), when in fact, the MTN program did not exist. Furthermore, they represented that their MTN program would pay nearly immediate returns in amounts ranging from 200 to 1000 percent.
They raised approximately $5 million dollars from approximately 100 investors nationwide over the course of the scheme. The investors' funds were not used to trade in financial instruments, but were instead misappropriated by Anderson, Smith and Kennedy for unauthorized uses. Investors, with the exception of those who received Ponzi scheme-like payments, that is, money taken from one investor to compensate another, lost their total investments. Anderson and Smith generally commingled and deposited investors' funds into bank accounts controlled by Anderson and Smith.
Anderson was the lead person for the investment program and managed the daily operations of the program, made key decisions as it related to the use of investor funds, handled investor communications, and oversaw the relationship with various promoters responsible for soliciting investors. During periodic conference calls with investors, Anderson conducted such calls and provided investors with purported updates. Similarly, Anderson would typically author and distribute e-mail communications to investors in which false information regarding the status of the investment was contained. As it related to the handling of funds collected by investors, Anderson typically controlled and determined the expenditure of such funds. He diverted thousands of dollars in investor funds for personal use including, house payments, meals and entertainment, personal judgments and salary payments for his children.This case was investigated by the Internal Revenue Service – Criminal Investigation, the Federal Bureau of Investigation, and the United States Postal Inspection Service.
This case is being prosecuted by Assistant U.S. Attorney Timothy Neff.
Final Defendant Convicted in $26 Million Fraud SchemeRead the Press Release
ADVANCE PAY SCHEME BILKED ENTREPRENEURS OF MILLIONS
PHILADELPHIA – Matthew McManus, 45, of Glenside, Pennsylvania, was convicted today for his role in an advance fee fraud scheme that defrauded hundreds of victims searching for commercial financing. McManus was charged with five other defendants, all of whom have pleaded guilty. Their scheme defrauded more than 1,900 victims out of more than $26 million. A sentencing hearing is scheduled for May 21, 2014. McManus faces a potential advisory guideline sentence of 15 years in prison with a statutory maximum possible sentence of 105 years in prison.
Defendant Andrew Bogdanoff, of Scottsdale, Arizona, was the founder and chairman of Remington Financial Group (later renamed Remington Capital) and ran the company with defendant McManus until 2008 in Arizona and Pennsylvania. After McManus left the company in 2008, defendant Shayne Fowler, also of Scottsdale, replaced McManus as Bogdanoff's right-hand man. Defendant Joel Nathanson, of San Diego, California, was one of Remington's most proficient employees and helped Remington defraud many victims. Defendant Frank Vogel, of Rochester Hills, Michigan, was a Michigan-based broker who referred numerous victims to Remington in exchange for large kickbacks. Aaron Bogdanoff, also of Scottsdale, was also charged in the conspiracy.
Between 2005 and 2011, the defendants fraudulently induced hundreds of people to pay Remington fees in excess of $10,000 a piece, based on false representations that Remington had lenders and/or investors ready to provide financing for the victims' projects. To facilitate this fraud, the defendants issued each victim a "letter of interest," commonly referred to as an LOI. Almost every LOI Remington issued stated that Remington had a lender or investor interested in financing the victim's project. Remington issued an LOI to every victim even though no Remington employee had spoken to any funding source and Remington knew that it was unlikely to find funding for the project.
The LOI was written to fraudulently lead victims to believe that Remington either was an actual lender or had spoken to lenders that had already expressed interest in the customer's project. Neither was true. Additionally, the financing terms Remington included in the LOI were unrealistic and were used solely to induce customers to pay Remington's advance fees. In addition to the false representations in the LOI, the defendants and other Remington employees also told victims the following lies to further induce victims to pay Remington=s fees: a) Remington had five investors or lenders interested in their project; b) Remington was the actual lender for the project; c) Remington funded or "closed" 80 percent of its deals; d) the victim would get funding for the project once the advance fee was paid and/or; e) Remington would provide funding through its funding source Northbridge. After a customer paid Remington's fee, McManus and Andrew Bogdanoff instructed Remington employees to find problems with the projects so that Remington could blame its failure to provide financing on the victim. The defendants did this to help protect Remington from civil and criminal complaints.
After the FBI and IRS conducted search warrants in Arizona and Colorado in March 2011, defendant Matthew McManus attempted to distance himself from the fraudulent scheme by obstructing justice and lying to federal agents. He was convicted of these charges, as well.
Some of the defendants used sophisticated means to perpetuate the fraud. For instance, in 2010, defendants Fowler and Andrew Bogdanoff used Remington's website to advertise an anti-fraud policy and stated falsely that Remington had recently provided information to the Federal Bureau of Investigation and local law enforcement authorities about a suspected email scam. Remington posted this information to ensure that if potential customers used an internet search engine to search for allegations about Remington's fraud, they would be directed to Remington's website rather than third-party internet sources that contained negative information about Remington.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigations with assistance from the Pennsylvania Securities Commission. It is being prosecuted by Assistant United States Attorney David Axelrod.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Fayette County Man Sentenced to Two Years and Nine Months in Federal Prison for Selling CocaineRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that John Wayne Taylor, Jr., 37, of Scarbro, West Virginia, was sentenced in federal court in Charleston today to two years and nine months in federal prison for distributing cocaine. Taylor previously pled guilty in November of 2013, admitting that on May 30, 2013, he sold approximately .41 grams of cocaine to an individual cooperating with the police. The drug deal took place near Scarbro. In imposing the sentence, the Court also considered Taylor’s admission that he had distributed 300 oxycodone pills and approximately 4 grams of cocaine over a period of time.
Taylor was sentenced by United States District Judge Thomas E. Johnston. The case was investigated by the Central West Virginia Drug Task Force and the prosecution was handled by Assistant United States Attorney John File.
Customer Service Representative Sentenced for Issuing Fraudulently Obtained Florida Driver LicensesRead the Press Release
Orlando, Florida – U.S. District Judge Charlene Honeywell yesterday sentenced Walter Brown (42, Kissimmee) to 2 years and 1 day in prison and 25 hours of community service for aggravated identity theft and conspiracy to produce fraudulently-obtained driver licenses. Brown pleaded guilty on December 13, 2013.
According to court documents, Brown was a Customer Service Representative in the Office of the Osceola County Tax Collector. Brown’s primary duty was to issue driver licenses and identification cards. Court documents show that, in his capacity, he issued more than 250 Florida Driver Licenses and identification cards to individuals who may not have been legally entitled to the documents. In some instances, Brown issued fraudulent driver licenses and identification cards in multiple identities, to the same person. For each fraudulently-issued piece of identification, Brown made an estimated $300 - $700.
The Osceola County Tax Collector’s Office reported Brown to law enforcement after internal controls revealed suspicious activity involving his issuance of Florida State Driver Licenses and identification cards. The Tax Collector’s Office cooperated fully in the investigation and Brown was terminated from his employment.
"Identity and document fraud poses a significant threat to our country's national security. This individual fraudulently issued identity documents to hundreds of individuals with no regard for the people whose identities were compromised," said Susan McCormick, special agent in charge of Homeland Security Investigations Tampa, which oversees the agency's Orlando office that conducted this investigation. "Thanks to cooperation from the Osceola County Tax Collector's Office, we were able to dismantle this scheme."
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, Department of State‘s Bureau of Diplomatic Security Services, and the Florida Highway Patrol’s Bureau of Criminal Investigations and Intelligence. It was prosecuted by Special Assistant United States Attorney Myrna Amelia Mesa.
Collin County Man Sentenced for Federal Firearms ViolationsRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – A 52-year-old Farmersville, Texas man has been sentenced to federal prison for firearms violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Charles Alan Curington pleaded guilty on Oct. 3, 2013, to attempting to sell a machinegun and was sentenced to 27 months in federal prison on Feb. 18, 2014, by U.S. District Judge Michael H. Schneider.
According to information presented in court, Curington recruited a do-defendant, Craig Marcus Cooper, to sell a machinegun for a share of the sale proceeds. On Jan. 31, 2012, Cooper and Colten Barrow traveled together to Duke’s Truck Stop on Highway 64 in Van Zandt County, Texas to meet an individual interested in buying the machinegun. The defendants intended to sell the firearm to the individual for $10,000. However, the buyer was actually an undercover federal agent. The defendants were detained and the 9 mm, fully automatic machine gun with an attached silencer was seized. The machinegun had been reported stolen approximately 10 years earlier. A federal grand jury returned an indictment on Mar. 27, 2013, charging Curington, Cooper and Barrow with firearms violations.On Jan. 10, 2014, Cooper was sentenced to 18 months in federal prison. On Jan. 15, 2014, Barrow was sentenced to 24 months in federal prison.
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This case was prosecuted as part of the Project Safe Neighborhoods Initiative. Project Safe Neighborhoods is aimed at reducing gun and gang violence, deterring illegal possession of guns, ammunition and body armor, and improving the safety of residents in the Eastern District of Texas. Participants in the initiative include community members and organizations as well as federal, state and local law enforcement agencies.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and prosecuted by Assistant U.S. Attorney Jim Noble.Clean Attorney Sentenced for Tax ViolationsRead the Press Release
Buffalo, N.Y. — U.S. Attorney, William J. Hochul, Jr. announced today that Edmund J. Renaud, 71, of Olean, N.Y., who was convicted of evading the payment of taxes involving his moving companies, was sentenced to 15 months in prison by Chief U.S. District Judge William M. Skretny.
Assistant U.S. Attorney Gretchen L. Wylegala, who handed the case, stated that the defendant failed to pay employment taxes for businesses he ran from 2002 through 2008. Renaud ran Southern Tier Moving and Storage, Inc., in Olean until 2002, when the Internal Revenue Service assessed over $48,000 in unpaid federal payroll taxes. Upon shutting down that entity, Renaud opened Southern Tier Moving and Storage, LLC, where from 2002 until 2006, Renaud similarly failed to pay over $86,000 in federal payroll taxes. When IRS revenue officers tried to collect the money, the defendant provided false information about bank accounts and other assets, including a truck he had gotten as a result of accumulating “comp” credits at the Seneca Allegany Casino.
In 2007, Renaud filed an Offer in Compromise, settling about $150,000 in taxes due for payment of only $1500. The information that the defendant provided to the IRS in connection with that Offer in Compromise was false in several respects, including false claims that the defendant was out of business, failure to identify bank accounts, and failure to disclose company assets. In fact, while Renaud was not paying his taxes, his companies were receiving income, and he was gambling heavily. Renaud also was the recipient of a significant Workmen’s Compensation award of approximately $100,000.
The plea is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service, Criminal Investigation Division, under the direction of Special Agent in Charge Toni Weirauch, New York Field Office.Burlington Man Sentenced for Felon in Possession ChargeRead the Press Release
DAVENPORT, IA - On February 19, 2014, Julian Jerome Collins, age 22, formerly from Burlington, Iowa, was sentenced by United States District Court Chief Judge James E. Gritzner to 90 months of imprisonment, after pleading guilty to possession of a firearm as a felon, announced United States Attorney Nicholas A. Klinefeldt. Collins was also ordered to serve two years of supervised release following the period of imprisonment, and to pay $100 towards the Crime Victims Fund.
On June 14, 2013, Collins was found in possession of a 9 millimeter Ruger handgun, after a prior felony drug conviction. In determining Collins’s sentence, the district court found he had two prior convictions for crimes of violence, and possessed the firearm in connection with another felony offense.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Burlington, Iowa, Police Department, the West Burlington, Iowa, Police Department, and the Southeast Iowa Narcotics Task Force. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Bucksport Woman Pleads Guilty to Embezzlement and False Tax Return ChargesRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Lynn
M. Bowden, 62, of Bucksport, Maine, pleaded guilty in U.S. District Court to embezzlement and false tax return charges.According to court documents, Bowden was hired by Merrill Merchants Bank (“Merrill”) in May 2004. Chittenden Corporation acquired Merrill in 2007. Merrill continued to operate as a separate unit of Chittenden Corporation until People’s United Bank acquired Chittenden
Corporation in 2008. Bowden maintained her employment through these acquisitions and was working as a wealth management officer for People’s United Bank when her fraudulent conduct was discovered in October 2012. The bank terminated her employment on October 26, 2012.
Before she was fired, Bowden managed over 200 trust and investment management accounts.
During the period April 4, 2005, to September 26, 2012, Bowden made 108 deposits and transfers of customer funds into her personal accounts for a total of $2,990,429.65. All of the funds came from wealth management accounts that she managed as a wealth management officer. She used all of the money for herself and for members of her family. Bowden failed to report to the Internal Revenue Service that she had received this income and that caused a tax loss of over $750,000 for the period 2007 to 2011.
Bowden faces a sentence of up to 30 years of imprisonment and a fine of up to twice the gain or loss on the embezzlement charge and up to five years in prison and a fine of up to
$250,000 on the false tax return charges. She will be sentenced after the completion of a presentence investigation report by the United States Probation Office.
The case was investigated by the Federal Bureau of Investigation and the Internal
Revenue Service—Criminal Investigations.Beaverton, Oregon Man Sentenced to 70 Months in Prison for Money LaunderingRead the Press Release
PORTLAND, Ore. – Larry Fuentes, 33, of Beaverton, Oregon, was sentenced yesterday by U.S. District Judge Marco A. Hernandez to 70 months in prison for the crime of money laundering. He was also ordered to pay $48,243 to the government in the form of a money judgment. Fuentes pleaded guilty to the crime of money laundering in October of last year, and the money judgment represents a portion of the approximately $120,000 that he admitted to laundering with his co-defendant and ex-girlfriend, Janelle Fuston. Fuentes was separately prosecuted in Washington County for possession and distribution of cocaine, and his federal sentence will run concurrently to the 48-month sentence he received last summer in Washington County for those drug charges.
Between April 2011 and April 2012, Fuentes conspired with Fuston, who was employed at the time by First Tech Federal Credit Union in Beaverton, to launder over $120,000 in Fuentes’s drug proceeds using several of Fuston’s accounts at First Tech. Before their crime was discovered, Fuston and Fuentes spent all but approximately $11,000 of the laundered drug proceeds, enjoying the fruits of their illegal conduct in the form of vacations, tanning salons, and other luxuries.
Once the money laundering conspiracy was discovered, Fuston was fired from her job at First Tech. She promptly admitted to her role in the conspiracy, took responsibility for her actions, and broke off all ties with Fuentes. She had no previous criminal history, and was sentenced in October to five years of probation and 200 hours of community service for her role in the crime. In contrast, Fuentes is a repeat offender with a lengthy criminal history that includes prior drug-related offenses. In addition, Fuentes repeatedly violated a judge’s order to have no contact with Fuston by sending her letters from prison urging her not to cooperate with authorities, telling her “It makes me angry how you believe [law enforcement] over the man you loved.”
“Drug crimes --- like many crimes --- are motivated by greed. This sentence underscores that those who launder the proceeds of crime can and will be prosecuted,” said U.S. Attorney Amanda Marshall. “Those who would use our nation’s financial institutions to legitimize their criminal proceeds will be held to account."
“The laundering of illegal drug profits is the way drug traffickers fund their illegal operations,” stated Kenneth Hines, Special Agent in Charge of IRS Criminal Investigation’s Seattle Field Office. “IRS Criminal Investigation will utilize all its expertise and resources to cut the flow of money that funds these drug traffickers that harm our communities.”
The investigation of this case was conducted by the High Intensity Drug Trafficking Area Interdiction Task Force, including the Portland Police Bureau’s Drugs and Vice Division, the Department of Homeland Security, and the Internal Revenue Service Criminal Investigation. The case was prosecuted by Assistant U.S. Attorney Katie Lorenz.Barrio Azteca Lieutenant Who Ordered the Consulate <br /> Murders in Ciudad Juarez Found Guilty on All CountsRead the Press Release
The Barrio Azteca Lieutenant who ordered the murders of a U.S. Consulate employee, her husband and the husband of another U.S. Consulate employee was found guilty by a jury on all counts charged announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Robert Pitman for the Western District of Texas, FBI Assistant Director of the Criminal Investigative Division Ronald T. Hosko and Administrator Michele M. Leonhart of the U.S. Drug Enforcement Administration (DEA).
Arturo Gallegos Castrellon, aka, “Benny,” aka “Farmero,” aka “51,” aka “Guero,” aka “Pecas,” aka “Tury,” aka “86,” 35, of Chihuahua, Mexico, was formally extradited to the United States from Mexico on June 28, 2012. Today, at the conclusion of a trial before U.S. District Judge Kathleen Cardone in the Western District of Texas, El Paso Division a jury found Gallegos Castrellon guilty to five counts of racketeering, narcotics trafficking, narcotics importation, murder in a foreign country and money laundering conspiracies and six counts of murder.
At trial, prosecutors presented evidence that the defendant was a leader in the Barrio Azteca, or “BA,” a violent street and prison gang that began in the late 1980’s and expanded into a transnational criminal organization. According to information presented in court, the BA formed an alliance with “La Linea,” which is part of the Juarez Drug Cartel. The Juarez Drug Cartel is also known as the Vincente Carrillo Fuentes Drug Cartel, or “VCF.” The purpose of the BA-La Linea alliance was to battle the Chapo Guzman Cartel and its allies for control of the drug trafficking routes through Juarez, Chihuahua, Mexico. The drug routes through Juarez, which is known as the Juarez Plaza, are important to drug trafficking organizations because it is a principal illicit drug trafficking route into the United States.
In addition, prosecutors presented evidence that the defendant was in charge of Barrio Azteca teams of assassin which he helped create and supervised in 2008 through 2010. Testimony and other evidence at trial established that his teams killed up to 800 persons between January and August 2010, reaching a total of nearly 1600 in a multi-year period.
Trial evidence also showed that the defendant ordered the March 13, 2010, triple homicide in Juarez, Mexico, of U.S. Consulate employee Leslie Enriquez, her husband Arthur Redelfs, and Jorge Salcido Ceniceros, the husband of another U.S. Consulate employee. The jury also heard evidence that the defendant was the mastermind of the July 15, 2010, car bombing in Juarez, Mexico, which targeted Mexican Federal Police.
A total of 35 defendants were charged in the Third Superseding Indictment and are alleged to have committed various criminal acts, including the 2010 Juarez Consulate Murders in Juarez, Mexico, racketeering, narcotics distribution and importation, retaliation against persons providing information to U.S. law enforcement, extortion, money laundering, murder, and obstruction of justice. Of the 35 defendants charged, 26 have been convicted, one committed suicide before the conclusion of his trial, and six are awaiting extradition. U.S. law enforcement officials are actively seeking to apprehend the two remaining fugitives in this case, including Eduardo Ravelo, an FBI Top Ten Most Wanted Fugitive.
The case is being prosecuted by Trial Attorney Joseph A. Cooley of the Criminal Division’s Organized Crime and Gang Section, Trial Attorney Brian Skaret of the Criminal Division’s Human Rights and Special Prosecutions Section and AUSA John Gibson of the U.S. Attorney’s Office of the Western District of Texas - El Paso Division. Valuable assistance was provided by the Criminal Division’s Offices of International Affairs and Enforcement Operations.
The case was investigated by the FBI’s El Paso Field Office, Albuquerque Field Office (Las Cruces Resident Agency), DEA Juarez, and DEA El Paso. Special assistance was provided by the Bureau of Alcohol, Tobacco, Firearms and Explosives; Immigration and Customs Enforcement; the U.S. Marshals Service; U.S. Customs and Border Protection; Federal Bureau of Prisons; U.S. Diplomatic Security Service; the Texas Department of Public Safety; the Texas Department of Criminal Justice; El Paso Police Department; El Paso County Sheriff’s Office; El Paso Independent School District Police Department; Texas Alcohol and Beverage Commission; New Mexico State Police; Dona Ana County, N.M., Sheriff’s Office; Las Cruces, N.M., Police Department; Southern New Mexico Correctional Facility and Otero County Prison Facility New Mexico.Bakken Drug Case Defendant Sentenced in Federal CourtRead the Press Release
The United States Attorney's Office announced on February 18, 2014, in a court proceeding in United States District Court in Billings, Judge Donald W. Molloy sentenced Samuel Davis Everson III, 47, of Fairview, North Dakota to 168 months imprisonment and five years supervised release for the offense of possession of methamphetamine with intent to distribute. The charge against Everson alleged that he committed the offense between April 2012 and September 20, 2013, in Sidney and Fairview, Montana, when he possessed pure methamphetamine with the intent to distribute as part of a scheme whereby he and others distributed large amounts of pure methamphetamine in northeastern Montana.
The term pure methamphetamine refers to the purity contained in the transacted amount which is usually "cut" with inert ingredients that make the actual product less pure but more profitable as drugs are generally sold based on quantity not quality.
The prosecution was part of Project Safe Bakken, a cooperative effort between federal and state prosecutors and federal, state, local, and tribal law enforcement agencies in Montana and North Dakota. The investigation in the case was performed by the Montana Division of Criminal Investigations, the Sidney Police Department, and the Drug Enforcement Administration.
United States Attorney Michael Cotter, whose office prosecuted the case in federal court, stated "This case demonstrates the serious sort of drug trafficking at play in the Bakken oil fields. But it also shows how cooperative work between federal, state, local, and tribal law enforcement agencies as part of Project Safe Bakken can successfully combat crime in the region. This effort will continue for as long as it takes to ensure the Bakken is safe place to live and work."
Army Soldier Pleads Guilty for<br /> Role in Stealing Fuel in AfghanistanRead the Press Release
U.S. Army Sergeant Albert Kelly III, 28, of Fort Knox, Ky., pleaded guilty today to theft charges for his role in the theft of fuel at Forward Operating Base (FOB) Salerno in Afghanistan.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney David J. Hale of the Western District of Kentucky made the announcement.
The plea was entered in federal court in Louisville, Ky., before Magistrate Judge James D. Moyer of the Western District of Kentucky. Kelly faces a maximum penalty of 10 years in prison when he is sentenced on May 22, 2014, by U.S. District Judge John G. Heyburn II.
According to court records, Kelly was a soldier in the United States Army and was assigned to FOB Salerno from January 2011 to January 2012. For most of that time, Kelly served as a specialist, and his duties included overseeing the delivery of fuel into FOB Salerno. Typically, the fuel was brought into the base by Afghan trucking companies driven by Afghan nationals. Kelly’s duties included verifying the amounts of the fuel that were downloaded at FOB Salerno and preparing and certifying documents that accounted for the fuel that was downloaded.
From in or about November 2011 through January 2012, Kelly diverted and permitted the diversion of fuel delivery trucks from FOB Salerno to other locations, where the trucks would then be downloaded and the fuel stolen. To conceal this diversion, he falsely certified that the diverted fuel was in fact delivered and downloaded at FOB Salerno.
In exchange for assisting the fuel theft, Kelly received approximately $57,000 from the Afghan trucking company for diverting approximately 25,000 gallons of fuel. The loss to the government was approximately $100,000.
This case was investigated by the Special Inspector General for Afghanistan Reconstruction (SIGAR). The prosecution is being handled by Special Trial Attorney Mark H. Dubester, on detail to the Criminal Division’s Fraud Section from SIGAR, and Assistant United States Attorney Michael A. Bennett of the Western District of Kentucky.Army Soldier Pleads Guilty for Role in Stealing Fuel in AfghanistanRead the Press Release
LOUISVILLE, Ky. – U.S. Army Sergeant Albert Kelly III, 28, of Fort Knox, Ky., pleaded guilty today to theft charges for his role in the theft of fuel at Forward Operating Base (FOB) Salerno in Afghanistan.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and David J. Hale, U.S. Attorney for the Western District of Kentucky made the announcement.
The plea was entered in federal court in Louisville, Ky., before Magistrate Judge James D. Moyer of the Western District of Kentucky. Kelly faces a maximum penalty of 10 years in prison and a restitution order of $100,000 when he is sentenced on May 22, 2014, by U.S. District Judge John G. Heyburn II.
"The theft of critical military supplies in Afghanistan jeopardizes mission readiness and potentially the safety of our soldiers," stated U.S. Attorney Hale. "We will continue to work with our military and law enforcement partners to investigate and prosecute those responsible for these types of crimes."
According to court records, Kelly was a soldier in the United States Army and was assigned to FOB Salerno from January 2011 to January 2012. For most of that time, Kelly served as a specialist, and his duties included overseeing the delivery of fuel into FOB Salerno. Typically, the fuel was brought into the base by Afghan trucking companies driven by Afghan nationals. Kelly’s duties included verifying the amounts of the fuel that were downloaded at FOB Salerno and preparing and certifying documents that accounted for the fuel that was downloaded.
From in or about November 2011 through January 2012, Kelly diverted and permitted the diversion of fuel delivery trucks from FOB Salerno to other locations, where the trucks would then be downloaded and the fuel stolen. To conceal this diversion, he falsely certified that the diverted fuel was in fact delivered and downloaded at FOB Salerno.
In exchange for assisting the fuel theft, Kelly received approximately $57,000 from the Afghan trucking company for diverting approximately 25,000 gallons of fuel. The loss to the government was approximately $100,000.
This case was investigated by the Special Inspector General for Afghanistan Reconstruction (SIGAR). The prosecution is being handled by Special Trial Attorney Mark H. Dubester, on detail to the Criminal Division’s Fraud Section from SIGAR, and Assistant United States Attorney Michael A. Bennett of the Western District of Kentucky.
Ammunition Smuggler SentencedRead the Press Release
LAREDO, Texas - Luis Garcia-Ugarte, 38, of Laredo, has been sentenced to federal prison for facilitating the attempted illegal export of thousands of rounds of assault rifle ammunition, announced United States Attorney Kenneth Magidson. He pleaded guilty Aug. 28, 2013.
Today, U.S. District Judge Marina Garcia Marmolejo handed Garcia-Ugarte a sentence of 41 months in federal prison to be followed by two years of supervised release.
According to testimony, authorities learned an individual was to purchase and provide to Garcia-Ugarte 1,500 rounds of 7.62x39 millimeter assault rifle ammunition on Oct. 10, 2012. Federal and local authorities conducted surveillance and observed Garcia-Ugarte arrive as scheduled at a Wal-Mart parking lot in Laredo driving a small sedan.
After obtaining the ammunition, Garcia-Ugarte left the parking lot and was pulled over by a Laredo Police Department (LPD) patrol officer for a traffic violation. The officer reported Garcia-Ugarte spoke only Spanish and did not possess a drivers’ license or any means of identification.
A search of the vehicle’s trunk resulted in the discovery of an additional 8,160 rounds of assault rifle ammunition (7.62x39 millimeter and .223 caliber). He claimed that none of the 9,660 rounds of ammunition belonged to him. He later recanted this claim, admitting to transporting the ammunition in his car and that he was to later transport other ammunition in his home to Mexican truck drivers who would attempt to illegally smuggle it into Mexico. Agents discovered an additional 2,318 rounds of 7.62x39 millimeter assault rifle ammunition at his residence, resulting in a total of 11,978 rounds of ammunition.
All ammunition was intercepted before reaching smugglers.
He was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
The investigation was conducted by Homeland Security Investigations and the Bureau of Alcohol, Tobacco, Firearms and Explosvies with the assistance of Border Patrol and the Laredo Police Department. Assistant United States Attorneys Jose Homero Ramirez and James B. Hepburn prosecuted the case.
Albuquerque Man Pleads Guilty to Federal Firearms ChargesRead the Press Release
ALBUQUERQUE – Timothy Patrick Shanks, 38, of Albuquerque, N.M., pleaded guilty this morning to federal firearms charges under a plea agreement that requires the imposition of a 12 year prison sentence. The guilty plea was announced by Acting U.S. Attorney Steven C. Yarbrough, 2nd Judicial District Attorney Kari E. Brandenburg, Special Agent in Charge Bernard J. Zapor of the Phoenix Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Bernalillo County Sheriff Dan Houston.
Shanks was arrested on July 3, 2013, based on a criminal complaint charging him with being a felon unlawfully in possession of a firearm. According to the criminal complaint, on June 24, 2013, the Bernalillo County Sheriff’s Office and ATF executed a search warrant at Shanks’ residence and recovered a firearm believed to have been used in the armed robbery of a Dollar General store located at 3211 Coors Blvd. SW on June 22, 2013. On July 25, 2013, Shanks was indicted and charged with being a felon in possession of a firearm, violating the Hobbs Act by committing an armed robbery of a business engaged in interstate commerce, and brandishing a firearm in relation to a crime of violence.
Thereafter, Shanks was charged in a superseding indictment with the following six crimes: (1) being a felon in possession of a firearm and ammunition on June 22, 2013, (2) violating the Hobbs Act by committing an armed robbery of a business engaged in interstate commerce on June 22, 2013, (3) brandishing a firearm in relation to a crime of violence, (4) distributing methamphetamine on May 9, 2013, (5) being a felon in possession of a firearm on May 21, 2013, and (6) being a felon in possession of a firearm on June 3, 2013. The superseding indictment alleged that all six offenses were committed in Bernalillo County, N.M.
During today’s proceedings, Shanks pleaded guilty to Counts 3 and 5 of the superseding indictment charging him with brandishing a firearm during a crime of violence and being a felon in possession of a firearm. In his plea agreement, Shanks admitted brandishing a .357 caliber revolver when he robbed the Dollar General store on June 22, 2013. He also admitted possessing a 9mm caliber rifle on May 21, 2013. Shanks acknowledged that he was prohibited from possessing firearms or ammunition because he previously had been convicted of possession of a controlled substance with intent to distribute and possession of a controlled substance.
Shanks has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled. Under the terms of his plea agreement, Shanks will be ordered to forfeit five firearms and ammunition when he is sentenced.
This case was investigated by the Albuquerque office of ATF and the Bernalillo County Sheriff’s Office with assistance from the 2nd Judicial District Attorney’s Office. It is being prosecuted by Assistant U.S. Attorney David M. Walsh 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.
Albuquerque Man Pleads Guilty to Federal Carjacking and Firearms ChargesRead the Press Release
ALBUQUERQUE – Raul Ortega, 21, of Albuquerque, N.M., pleaded guilty this morning to federal carjacking and firearms charges, announced Acting U.S. Attorney Steven C. Yarbrough, Special Agent Carol K.O. Lee of the Albuquerque Division of the FBI and Chief Allen Banks of the Albuquerque Police Department.
Ortega and co-defendant Joel Meeks, 20, also of Albuquerque, were arrested in April 2013, on an eight-count indictment charging the pair with offenses stemming from a series of armed robberies of commercial businesses and home invasions, including armed robbery and carjacking, occurring in Bernalillo County, N.M., from Dec. 6, 2012 to Jan. 17, 2013.
During today’s proceedings, Ortega pleaded guilty to Counts 5, 6 and 7 of the indictment, charging him with two carjackings. In his plea agreement and with respect to Counts 5 and 6, Ortega admitted that on Jan. 13, 2013, Meeks and he forcibly entered a residence and robbed the owner of credit cards, his identification and other items. Ortega also admitted that Meeks and he physically assaulted the victim to obtain the PIN for his ATM card, his car keys and the location of his car. Before departing, Ortega and Meeks threatened the victim’s life if he reported the crime to the police. Ortega admitted that he was armed with a handgun while committing these crimes.
In his plea agreement and with respect to Count 7, Ortega also admitted that on Jan. 17, 2013, Meeks and he forcibly entered another residence and physically assaulted the owner. After restraining the victim, Meeks and Ortega robbed him of his credit cards, ATM cards and other items. After obtaining the PIN for the victim’s ATM card by threatening him further physical abuse, Meeks and Ortega also robbed the victim of his car keys and car.
Under the terms of his plea agreement, Ortega will be sentenced to a prison term of 12 to 20 years to be determined by the court. Ortega has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled.
Meeks has pleaded not guilty and remains in federal custody pending trial which currently is scheduled March 3, 2014. The charges against Meeks are merely accusations and Meeks is presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Albuquerque office of the FBI and the Albuquerque Police Department with assistance from the 2nd Judicial District Attorney’s Office. It is being prosecuted by Assistant U.S. Attorney Jon K. Stanford 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.
Air Force Sergeant Pleads Guilty to Negligent Child Abuse Resulting in Great Bodily Injury and DeathRead the Press Release
LAS CRUCES – Peter John Zayas, 29, pleaded guilty late this afternoon in Las Cruces federal court to a felony information charging him with negligent child abuse resulting in great bodily injury, announced Acting U.S. Attorney Steven C. Yarbrough, Special Agent Carol K.O. Lee of the Albuquerque Division of the FBI, and Acting Special Agent in Charge Gregory Harper of the Air Force Office of Special Investigations.
Zayas and his wife, Sophia Zayas, 32, were arrested in April 2012 by the FBI and the Air Force Office of Special Investigations on charges that between Oct. 21, 2007 and Oct. 22, 2007, they caused their two-month old infant daughter’s death. In Nov. 2012, a 16-count superseding indictment was filed charging Zayas and Sophia Zayas with second degree murder, child abuse resulting in death, child abuse resulting in great bodily harm, and other child abuse-related offenses. At the time of the offenses alleged in the superseding indictment, Zayas was a sergeant with the U.S. Air Force and was stationed at Holloman Air Force Base.
During this afternoon’s proceedings, Zayas pleaded guilty to negligent child abuse resulting in great bodily harm. In his plea agreement, Zayas admitted that from Aug. 16, 2007 through Oc. 22, 2007, he permitted his infant to be in a situation that endangered her life knowing that there was a foreseeable risk that she would be physically harmed or killed by leaving her in the care of Sophia Zayas knowing that she had a history of alcohol abuse. Zayas acknowledged that the infant sustained posterior transverse skull fractures, rib fractures, and radius and ulna fractures as a result of his negligence.
According to the plea agreement, Zayas also acknowledged that the infant died on Oct. 22, 2007, as a result of his negligence because it was foreseeable to him that leaving the infant in Sophia Zayas’ care could lead to harm given Sophia’s alcohol consumption and binge drinking during the Oct. 14, 2007 through Oct. 22, 2007.
Zayas has been in federal custody since his arrest and remains detained pending his sentencing hearing. At sentencing, he faces a penalty of 18 years in prison.
Sophia Zayas has pleaded not guilty to the charges against her and remains in federal custody pending her trial, which is scheduled for March 10, 2014. The charges against Sophia Zayas are merely accusations and she is presumed innocent unless found guilty beyond a reasonable doubt.
The case was investigated by the FBI and the Air Force Office of Special Investigations and is being prosecuted by Assistant U.S. Attorneys Maria Y. Armijo and Anna R. Wright.
18 February 2014
Youngstown Man Charged with Operating A Crack House, Possessing A Firearm and SilencerRead the Press Release
A Youngtown man was indicted on charges related to operating a crack house and having a firearm and silencer despite previously being convicted of a felony, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Deangelo Young, age 39, was indicted on one count each of maintaining a residence for distributing crack cocaine, being a felon in possession of firearms and ammunition, and possession of a firearm not registered to him in the National Firearms Registration and Transfer Record.
"We will continue to prosecute those who have firearms despite previous convictions," Dettelbach said.
Count 1 of the indictment charges that in or about August 2013, Young maintained a residence on East Chalmers Street in Youngstown, Ohio, for the purpose of distributing crack cocaine.
Count 2 of the indictment charges that on or about August 29, 2013, Young possessed a Ruger Mark I, .22 caliber pistol; a Ruger SR22, .22 caliber pistol; a Charter Arms Undercover, .38 caliber revolver, and ammunition, after having been previously convicted of Trafficking in Cocaine and Possession of Cocaine in the Mahoning County Common Pleas Court.
Count 3 of the indictment charges that on or about August 29, 2013, Young possessed a firearm with a silencer, not registered to him, as required by law.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictment was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Youngstown Police Department. The matter is being prosecuted by Assistant United States Attorney David M. Toepfer.
An indictment in only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Wichita Man ConvictedOn Federal Firearms ChargesRead the Press Release
WICHITA, KAN. - A Wichita man was convicted Tuesday on federal firearms charges, U.S. Attorney Barry Grissom said.
Michael R. Horn, 42, Wichita, Kan., was convicted on one count of unlawful possession of a firearm after a felony conviction and one count of unlawful possession of ammunition after a felony conviction. During a jury trial, prosecutors presented evidence that on Sept. 16, 2013, Horn unlawfully possessed a Bersa .380 caliber handgun and 10 rounds of ammunition for the gun. Horn was prohibited by federal law from possessing a firearm because of a felony conviction in 2004 in Sedgwick County District Court on a charge of aggravated battery.
Sentencing will be scheduled at a later date. He faces a maximum penalty of 10 years in federal prison and a fine up to $250,000 on each count. Grissom commended the Wichita Police Department and Assistant U.S. Attorney Mona Furst for their work on the case.
Virginia-Based Contractor to Pay $6.5 Million to Settle Allegations of False Claims on Navy ContractsRead the Press Release
Vector Planning and Services Inc. (VPSI), an information technology, systems engineering, program management and consulting firm headquartered in Chantilly, Va. , has agreed to pay the government $6.5 million to settle False Claims Act allegations that the company inflated claims for payment under several Navy contracts, the Justice Department announced today. VPSI’s West Coast center of operations is in San Diego, Calif.
“The Department of Justice will vigorously protect taxpayer funds from false claims,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “Contractors who wish to do business with the military must act with honesty and integrity, or they will be held accountable for their actions.”
VPSI has a number of contracts with the Navy and its contractors to provide information technology, systems engineering and management consulting services. Under these contracts, VPSI is entitled to bill the government for its indirect costs, which are costs such as overhead that cannot be allocated directly to a particular contract. The government alleged that, from 2005 to 2009, VPSI inflated its indirect cost billings to the government by improperly including direct costs, for which it had already been paid, in indirect cost accounts that were then allocated across its government contracts and billed again. The government further alleged that VPSI submitted claims for other costs that were never incurred.
“Our office will work aggressively with our investigative partners to protect taxpayer funds from abuse,” said U.S. Attorney for the Southern District of California Laura E. Duffy. “Today’s settlement demonstrates our commitment to pursue defense contractors who knowingly defraud or overcharge military programs.”
The allegations resolved by the settlement were originally brought by a whistleblower in the U.S. District Court for the Southern District of California, under the qui tam, or whistleblower, provisions of the False Claims Act. The Act permits private parties to sue, on behalf of the government, companies and individuals who have falsely claimed federal funds and to share in any recovery. The whistleblower in this case will receive $1.28 million.
This settlement is the result of a coordinated effort by the Justice Department’s Civil Division, the Civil and Criminal Divisions of the U.S. Attorney’s Office for the Southern District of California, the Defense Criminal Investigative Service, the Naval Criminal Investigative Service and the Defense Contract Audit Agency.
The case is captioned United States ex rel. Hai Ba Trung v. Vector Planning and Services Inc., et al., 3:12-cv-02353-LAB-BGS (S.D. Calif.). The claims settled by this agreement are allegations only; there has been no determination of liability.
Two Williamson County Residents Charged with Methamphetamine ConspiracyRead the Press Release
On February 4, 2014, Michael A. Boyt, Sr., 41, of Marion, and Matthew S. Beers, 30, of Johnston City, were charged by indictment with conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
The offense occurred between 2012 and January 2014, in Williamson, Perry, Jackson, and Randolph Counties. Beers made his initial appearance in federal court on February 10, 2014. At his February 14, 2014, detention hearing, he was ordered held without bond pending an April 21, 2014, jury trial. Boyt made his initial appearance on February 13, 2014. He is currently being held without bond pending a February 18, 2014, detention hearing.
The methamphetamine offense carries a penalty of up to 20 years’ imprisonment, to be followed by 3 years’ supervised release, and a fine of $1,000,000.
Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Southern Illinois Enforcement Group, Illinois State Police/Southern Illinois Drug Task Force, Murphysboro Police Department, and Drug Enforcement Administration. The Illinois State Police Methamphetamine Response Team assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Two Local Men Sentenced for Producing Child Pornography of Young RelativesRead the Press Release
CORPUS CHRISTI, Texas – Carlos Cortinas, 40, and Mark Anthony Stokes, 36, of Three Rivers, have received significant sentences following their convictions of sexual exploitation of a child, commonly known as production of child pornography, announced United States Attorney Kenneth Magidson. Both men pleaded guilty Monday, Oct. 21, 2013.
Senior U.S. District Judge John D. Rainey, who accepted the guilty pleas, sentenced Cortinas and Stokes to respective sentences of 212 and 140 months in federal prison. At the hearing, the court considered Stokes cooperation with the government and the fact that Cortinas had victimized two children, but recognized both men had committed the same crime in essentially the same manner. In handing down the sentence, Judge Rainey considered the need to protect the public and deter future criminal conduct. They will both serve 10 years of supervised release following completion of their prison terms and will also be ordered to register as sex offenders.
The investigation began on May 13, 2013, after police responded to a domestic violence call in Three Rivers. Stokes, who had been stabbed and cut by his wife, told officers that his wife had injured him after she discovered nude photos of minor female relative on a flash drive. Stokes admitted to a sexual interest in children for the past 20 years.
Several years prior to this incident, Stokes and Cortinas had a conversation in which both discussed their mutual sexual interest in children. Stokes told Cortinas he had nude images of the young female, which Cortinas asked to see. Stokes then sent some of the images of the child via text message from his cell phone. Within an hour, Cortinas then sent nude images of one of his minor female relatives as well. From that day forward, Stokes and Cortinas would send each other voyeur type images of these minor children taken without the their knowledge as well as other child pornography images downloaded from the Internet. Cortinas also sent nude images of another child which he had taken. State search warrants were executed on both residences which resulted in the discovery of evidence related to the child pornography production described by Stokes.
Both men will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.This case, prosecuted by Assistant United States Attorney Lance Duke and investigated by the FBI, 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."
Three Medical Groups and A Medical Billing Company Agree to Pay $3,340,979 to Resolve Investigation into Medicare Overbilling SchemeRead the Press Release
Baltimore, Maryland B Medical billing company Engage Medical, Inc., its owner Sanjay Puri and three medical practices that were its clients have agreed to pay a total of $3,340,979 to resolve claims that Engage Medical overbilled for nuclear stress tests. Engage Medical and Sanjay Puri have agreed to pay $544,500; Advanced Cardiology Center and its owners Pankaj Lal, M.D., Mubashar Choudry, M.D. and Moshin Ijaz, M.D. agreed to pay $1,894,549.50; Reva Gill, M.D. and Kenilworth Internists, P.A. agreed to pay $242,204; and Sureshkumar Muttath, M.D. agreed to pay $659,726.
The settlement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services.
“When medical providers can enrich themselves at taxpayers’ expense by falsely representing that they provided expensive procedures, the government must be vigilant in pursuing fraudulent claims,” said U.S. Attorney Rod J. Rosenstein. “Anyone who knowingly reports false medical billing codes to induce the government to pay more money is lying, cheating and stealing.”
The allegations resolved in the settlement agreement involve overbilling of nuclear stress tests between July 31, 2007 and March 8, 2011. Engage Medical operated in Virginia, Washington, D.C. and Maryland. During this time, Engage Medical contracted with physicians and physician practices, holding itself out as having expertise in medical billing. Engage Medical staff would obtain records from physician clients related to the medical services provided, and transmit that information to staff in India, where medical coders would apply the relevant Current Procedural Terminology (“CPT”) codes and bill applicable insurance, including Medicare and other federally funded health insurance programs.
The billings at issue involved nuclear stress tests which are designed to assess cardiac function. Engage Medical marketed these tests to general practitioners, persuading them that instead of referring the patients to cardiologists for these tests, Engage could arrange to have the testing service performed in the general practitioner’s offices and bill for the tests, all of which would increase the general practitioners’ incomes. Dr. Muttath and Dr. Gill, two internists, agreed to allow Engage to provide this service.
Engage Medical’s billing of these tests, however, was false and in direct contradiction to published materials about such medical billing. Engage Medical systematically billed for each service twice, using a CPT code modifier intended to be used when the service had been repeated by the same physician or when a distinct service was performed on the same day. In fact, none of the tests were repeated and none of the tests was a distinct procedural service.
Engage Medical also included with its billing a CPT code that was intended to be used for interpreting and reporting images, even though proper CPT coding for a nuclear stress test already compensated the physician for interpreting and reporting the tests results. This is called “unbundling” and occurs when a medical biller falsely adds additional CPT codes for services – such as interpreting the test – that are already encompassed by the CPT code for the nuclear stress test itself. In unbundling in this way, however, Engage Medical ignored the plain language in the applicable CPT coding manuals that specifically told coders not to use the reporting and interpretation CPT codes when billing for nuclear stress tests. Billing staff at Engage Medical learned that by merely adding these codes it could increase the amount Medicare and other federally insured medical programs would pay to the medical provider clients.
In 2009, Engage Medical contracted with Advanced Cardiology Center and its three physician owners: Pankaj Lal, M.D., Mubashar Choudry, M.D. and Moshin Ijaz, M.D. Advanced Cardiology hired Engage Medical to re-bill claims for nuclear stress tests that Advanced Cardiology had already performed, billed and been paid for, in some cases years before. Advanced Cardiology gave Engage Medical access to Advanced Cardiology’s billing files and Engage Medical isolated the instances where Advanced Cardiology had performed and been paid for nuclear stress tests. Using its false billing model, Engage Medical resubmitted the nuclear stress tests for payment a second time, using the CPT codes that reflected a distinct or repeat service, and also added the unbundled code for interpretation. Unlike the internists, however, Advanced Cardiology did not retain Engage Medical to bill claims after February 2010 and thus Advanced Cardiology did not give Engage Medical access to Advanced Cardiology medical records of its patients beyond that time. Rather, Advanced Cardiology employed the Engage Medical model itself, with its own billers applying the false CPT codes to new tests that the cardiologists at Advanced Cardiology performed.
The claims settled by this agreement are allegations, and there has been no determination of liability. The settlement was the result of an investigation by the United States Attorney’s Office for the District of Maryland, with assistance from the Office of Inspector General for the Department of Health and Human Services. Assistant U.S. Attorney Allen Loucks handled the case, and auditor Mary Hammond and investigator Steve Capobianco in the U.S. Attorney’s Office, assisted in this investigation.
Three Found Guilty for Roles in $20 Million Health Care Fraud Scheme Involving Bogus Prescriptions for Expensive Anti-Psychotic DrugsRead the Press Release
LOS ANGELES – Three people linked to a Glendale medical clinic – including a doctor who took money to let his name be used thousands times on bogus prescriptions – were found guilty today of federal fraud charges related to a $20 million scheme to defraud Medicare and Medi-Cal by, among other things, fraudulently prescribing expensive anti-psychotic medications and then re-billing the government for those drugs over and over.
Today’s convictions stem from the first case in the nation alleging an organized scheme to defraud government health care programs through fraudulent claims for anti-psychotic medications. The evidence presented at trial showed how the operators of Manor Medical Imaging in Glendale operated a clinic authorized to make claims to Medicare and Medi-Cal, employed an unlicensed medical practitioner to write bogus prescriptions using an American doctor’s name and license number, and had close relationships with pharmacies and a fraudulent drug wholesale company that were used to funnel prescription drugs back to the pharmacies participating in the scheme.
In the largest case of its kind in Southern California brought against defendants who bilked Medicare Part D, prosecutors showed a federal jury how employees of Manor Medical generated thousands of prescriptions for identify theft victims – such as elderly Vietnamese beneficiaries of Medicare or Medi-Cal, military veterans who were recruited from drug rehab programs, and denizens of Skid Row. Members of the conspiracy created or doctored patient files to make it falsely appear the drugs were necessary and the patients were legitimately treated. After the prescriptions were filled at pharmacies and paid for by Medicare and Medi-Cal, they were sold on the black market and redistributed to pharmacies, where the drugs would be subject to new claims made to Medicare and Medi-Cal as though they were new bottles of drugs.
The scheme generated fraudulent billings of more than $20 million dollars, of which Medi-Cal and Medicare actually paid more than $8 million.
“The defendants took advantage of this nation’s most vulnerable citizens and took millions of dollars from public health care programs that are designed to help the disadvantaged,” said United States Attorney André Birotte Jr. “Members of this scheme caused thousands of bottles of dangerous prescription drugs to be diverted to the black market. This case is an example of how operators of health care fraud schemes will be brought to justice, whether they be doctors who enable the fraud or those on the street who recruit patients and divert prescription drugs to the black market.”
The three defendants convicted today are:
Dr. Kenneth Johnson, 47, of Ladera Heights, who served as the face of Manor with pharmacists and auditors from Medicare and Medi-Cal, and who pre-signed thousands of blank prescriptions that were filled out by co-conspirators;
Nuritsa Grigoryan, 49, of Glendale, who holds an Armenian medical license and who pretended to be an American doctor when she saw homeless “patients” at the clinic and filled out the bogus prescriptions pre-signed by Dr. Johnson; and
Artak Ovsepian, 32, of Tujunga, one of the leaders of the conspiracy who oversaw the acquisition of drugs at pharmacies using the bogus prescriptions.
The three defendants were convicted of health care fraud conspiracy, aggravated identity theft, conspiracy to misbrand pharmaceutical drugs, false statements to the federal government, and conspiracy to use other persons’ identification documents in furtherance of fraud.
Following the reading of the verdicts, United States District Judge S. James Otero, who presided over the three-week trial, said, “The scope of the fraud was breathtaking.” Judge Otero said the defendants “preyed upon the poor [and] used them as pawns.”
Judge Otero is scheduled to sentence Grigoryan and Ovsepian on June 9. Johnson is scheduled to be sentenced on June 30. At sentencing, all three defendants will face a mandatory sentence of two years in federal prison for committing aggravated identity theft. In addition to the two-year terms, Johnson and Grigoryan statutory maximum sentences of 30 years in federal prison, while Ovsepian will face an additional sentence of up to 35 years.
A fourth defendant who went to trial – Artyom Yeghiazaryan, a driver who took beneficiaries to pharmacies – was acquitted by the jury.
With today’s verdicts, a total of 16 defendants charged in 2011 (see: http://www.justice.gov/archive/usao/cac/Pressroom/2011/157.html) have now been convicted of various charges related to the health care fraud scheme. A total of 18 defendants were indicted in relation to the scheme centering on Manor Medical, but also involving pharmacies in and around the San Gabriel Valley. The conspiracy was essentially a “prescription harvesting” scheme in which Medicare and Medi-Cal beneficiaries were recruited or had their identities stolen, the beneficiary information was used to bill Medicare and Medi-Cal for millions of dollars of illegitimate medical services and prescriptions, and the drugs that were dispensed by the pharmacies were diverted to black market wholesalers and back to the pharmacies so the drugs could be used to submit new bills to Medicare and/or Medi-Cal as though the drugs had never been dispensed.
“This scheme to defraud federal and state governments endangered the public’s health by putting adulterated medicines onto the U.S. market,” said John Roth, Director, FDA’s Office of Criminal Investigations. “We will continue to bring to justice those who put profits above health and safety.”
IRS Criminal Investigation Special Agent in Charge Joel P. Garland said, “Using the identities of the most vulnerable members of society to defraud government health care programs is a despicable crime. It depletes scarce taxpayer dollars and will not be tolerated. Law enforcement officers will respond to it using every legal resource at our disposal. Let this conviction serve as a warning to those who are considering similar conduct.”
The primary pharmacy involved in the case, Huntington Pharmacy in San Marino, was operated by a Pasadena couple whose business grew dramatically due its affiliation with Manor Medical, including Medi-Cal claims that jumped from $50,000 in 2009 to approximately $1.5 million in 2010. One of the owners of the pharmacy, Phic Lim, is scheduled for trial on August 19. His wife, Theana Khou, previously pleaded guilty as part of a joint resolution with another case filed against her and her husband.
“As today's verdicts make clear, federal and state law enforcement will crack down hard on these organized Medicare and Medi-Cal drug benefit fraud schemes,” said Glenn R. Ferry, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General Los Angeles region. “This case, involving very expensive brand name anti-psychotic drugs, is the largest of its kind here in Southern California.”
The investigation in this case, which was called Operation “Psyched Out,” was conducted by the San Marino Police Department; the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; the United States Food and Drug Administration, Office of Criminal Investigations; IRS-Criminal Investigation; the United States Department of Health and Human Services, Office of the Inspector General; U.S. Immigration and Customs Enforcement; the Glendale Police Department, Organized Crime Team; and the California Department of Health Care Services, Audits and Investigations Branch.
Release No. 14-023
Three Defendants Plead Guilty in Federal Student Aid Fraud SchemeRead the Press Release
OAKLAND – Kyle Edward Moore, Cortio Detrice Wade, and Marcel Devon Bridges pleaded guilty on February 14, 2014, in federal court in Oakland to conspiracy to commit financial aid fraud and wire fraud, United States Attorney Melinda Haag announced.
In pleading guilty, Moore, Wade, and Bridges admitted to conspiring to obtain federal student aid funds offered under the Title IV Federal Student Assistance Program. Moore and his co-defendants obtained the aid by preparing and transmitting fraudulent Free Applications for Federal Student Aid (FAFSAs) to the U.S. Department of Education.
In carrying out the fraud scheme, Moore and his co-defendants recruited third-parties to serve as “straw students” and then assisted the straw students in preparing, signing, and transmitting fraudulent FAFSAs knowing that many of the straw students were not eligible to obtain Title IV funds because, among other things, the straw students had not obtained high school diplomas or a recognized equivalent and had no intention of attending school or using the funds for educational purposes. After receiving the student loan funds, Moore and his co-defendants would share the fraudulently obtained funds among themselves and sometimes with the straw students.
Moore, Wade, and Bridges admitted to defrauding the Department of Education in the amounts of $771,268, $136,088, and $114,734, respectively.
Moore, Wade, and Bridges were indicted by a federal Grand Jury on August 15, 2013. They were charged with conspiracy to commit financial aid fraud in violation of 18 U.S.C. § 371, and with multiple counts of wire fraud in violation of 18 U.S.C. § 1343. Pursuant to their plea agreements, Moore pleaded guilty to two counts of conspiracy and one count of wire fraud; Bridges pleaded guilty to one count of conspiracy and one count of wire fraud; and Wade pleaded guilty to one count of conspiracy and four counts of wire fraud.
Moore, Wade, and Bridges were released on bonds.
Moore and Bridges have a sentencing hearing scheduled for August 22, 2014. Wade has a sentencing hearing scheduled for September 19, 2014. Both sentencing hearings will be held before the Honorable Jon S. Tigar, United States District Court Judge, in Oakland. The maximum statutory penalty for each count of conspiracy to commit financial aid fraud in violation of 18 U.S.C. § 371 is five years in prison, a fine of $250,000 or twice the gross gain or loss, whichever is greater, and restitution. The maximum penalty for each count of wire fraud in violation of 18 U.S.C. § 1343 is twenty years in prison, a fine of $250,000 or twice the gross gain or loss, whichever is greater, and restitution. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
AUSA Wade M. Rhyne is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Janice Pagsanjan and Patty Lau. The prosecution is the result of an investigation by the U.S. Department of Education, Office of the Inspector General, the Federal Bureau of Investigation, and the U.S. Department of Housing and Urban Development, Office of the Inspector General.
(Moore indictment )
Texas Oil Executive Indicted on Scheme to Commit Wire and Mail FraudRead the Press Release
SAN JOSE – A federal grand jury in San Jose returned a sixteen count superseding indictment charging a Texas-based oil executive with undertaking a scheme to commit wire and mail fraud, announced United States Attorney Melinda Haag and FBI Special Agent in Charge David J. Johnson.
According to the indictment, which was unsealed earlier today, Dwayne Kent Singleton, 51, a resident of Texas, is named as the sole defendant in eight counts of mail fraud and eight counts of wire fraud between approximately 2008 and 2009.
According to the superseding indictment, Singleton was one of the founders and senior executives of a business known Santana Energy Services, LLC (“Santana”), which has its administrative offices in Santa Clara, California, and whose primary focus was re-entry drilling of existing oil wells that had been abandoned by larger oil concerns but had potential oil reserves. Singleton resided in Texas and assumed the role of site operations manager for the oil drilling sites. Among his duties, Singleton also submitted Santana's contractor and vendor payment requests via telephone or e-mail to Santana’s offices in California. Relying on these requests, Santana’s executives in California signed the checks drawn on its business account in Santa Clara. The signed vendor checks were then sent via Federal Express to Singleton in Texas.
Beginning in early 2008, according to the superseding indictment, Singleton began requesting payments from Santana for work purportedly performed or equipment/infrastructure furnished by vendors at Santana’s drill sites in Texas. Singleton, either directly or through his assistant in Texas, emailed Santana’s offices in Santa Clara, requesting that payments be made payable to certain entities. Typically, the e-mails were cryptic and appeared to be requesting payments to be made payable to vendors. Based on Santana’s understanding that the payments were being made to third-party vendors for work performed on Santana’s drilling sites, Santana’s employees in Santa Clara would prepare and execute checks drawn on a Santana-controlled business account at a bank in Santa Clara. Santana then transmitted those checks via Federal Express mailings to Singleton’s offices in Texas.
According to the allegations, Singleton did not, in fact, use the checks provided by Santana to pay the third-party vendors that he had identified in e-mails to Santana’s Santa Clara offices. Instead, the checks were made payable to companies that Singleton himself had created and controlled, and the checks were deposited into bank accounts Singleton alone controlled.
According to the superseding indictment, many of these accounts were in the name of shell companies with names similar to – and only slightly different from – genuine contractors and vendors who had actually been retained to perform services for the benefit of Santana. These shell companies had no employees, vouchers, credit or expenses associated with Santana. The money deposited into these accounts was not used for Santana expenses, as Singleton had represented in his e-mails and other communications with Santana. Instead, it was transferred or spent by Singleton for unauthorized, personal matters.
As a result of this scheme, Singleton eventually diverted well over $1,000,000 in corporate funds for purposes unauthorized by and unrelated to Santana, including his mortgage, a private jet, and his hunting ranch in North Texas.
After first appearing in federal court in Texas earlier this month and ordered to travel to San Jose, the defendant made his initial appearance in federal court in San Jose earlier today before the Honorable Howard R. Lloyd, United States Magistrate Court Judge, who unsealed the indictment. Singleton is currently out on bond. His next scheduled appearance is on March 11, 2014, at 1:30 p.m., in San Jose before the Honorable Howard R. Lloyd for review of terms of bond and for status and further setting on April 2, 2014, at 9:30 a.m., before the Honorable Lucy H. Koh, United States District Court Judge in San Jose.
The maximum statutory penalty for each count of the indictment is twenty years imprisonment, a fine of $250,000 or twice the amount of gain or loss, whichever is greater, and restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Timothy J. Lucey is the Assistant United States Attorney who is prosecuting the case with the assistance of Laurie Worthen. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Please note, an Indictment contains only allegations against an individual and, as with all defendants, Dwayne Kent Singleton must be presumed innocent unless and until proven guilty.
(Singleton superseding indictment )
Tax Return Preparer Sentenced to Federal Prison in Fraud and Identity Theft SchemeRead the Press Release
ATLANTA – A federal judge has sentenced Bernando O. Davis to 21 years and seven months in prison for using stolen identities to file false federal income tax returns that claimed millions of dollars in bogus refunds.
“This lengthy prison sentence reflects the serious damage suffered by more than 15,000 victims across the country at the hands of a prolific identity thief and tax cheat,” said United States Attorney Sally Quillian Yates said. “Mr. Davis lied to his victims to steal their personal information, which he then used to file over $19 million in phony tax returns, making this one of the largest stolen identity tax return cases prosecuted in this district. Given the unfortunate popularity of these schemes, the stiff sentences received by these defendants should send a strong message to identity thieves to get out of this business.”
“The IRS is deeply concerned about those individuals who may have been the victims of stolen identity refund fraud,” stated Veronica Hyman-Pillot, IRS Criminal Investigation Special Agent in Charge. “Identifying, investigating and vigorously prosecuting those individuals involved in these tax related identity theft schemes remains a top priority for IRS Criminal Investigation.”
“A large part of the U.S. Postal Inspection Service’s mission is to ensure public trust in the mail. When that trust is challenged, Postal Inspectors will aggressively investigate and remain steadfast in its resolve to seek justice against those who would seek illegal profiting from the U.S. mail.” said George Frazier, Assistant U.S. Postal Inspector in Charge, Atlanta Field Office.
According to United States Attorney Yates, the charges and other information presented in court: From approximately July 2010 to January 2013, Davis operated “Davis Tax Service,” a tax preparation business in Clayton County, Ga. Davis, working with others, including Kevin J. Sonnier of Ellenwood, Ga., and Carla L. Jefferson of Lancaster, Ca., led thousands of victims to believe that they could apply for “government stimulus payments” or “free government money” from the federal government by providing their names and Social Security numbers. Davis and his conspirators used toll-free telephone numbers, web sites, flyers, and radio advertisements to advertise the “stimulus payments” and collected victims’ personal information when they applied for the payments. They also recruited “runners” who promoted the scheme by word of mouth and collected victims’ personal information.
In addition to the “stimulus” charade, Davis and his co-conspirators acquired names from a variety of sources, including prisons and homeless shelters, to use in the fraud. Many victims testified that they had never heard about the “stimulus payments,” but their identities were nonetheless used by Davis and his co-conspirators to file bogus tax returns.
In actuality, no stimulus program existed, and Davis and his co-conspirators instead used the victims’ personal information to file fraudulent tax returns that claimed a total of over $19 million in bogus refunds. On the returns, Davis claimed false income amounts and student credits to generate the bogus tax refunds. In many of the returns, Davis directed the IRS to pay the refund amounts to bank accounts controlled by him or his co-conspirators. The victims did not know that Davis had filed tax returns in their names. The scheme affected over 15,000 victims in virtually every state across the country.
The evidence at trial showed that Davis had over 1,600 tax refund checks sent to his home address in Stockbridge, Ga., by listing his home address as the victims’ address on the tax returns he filed in their names. In addition to the checks, Davis received thousands of letters addressed to the victims from the IRS, Social Security Administration, and other government agencies. After seeing such a large number of Treasury checks coming to Davis’ home address, a mail carrier seized over 1,000 of these checks and provided them to law enforcement.
Federal agencies executed a search warrant at Davis’ and Sonnier’s business location in February 2013. There they found numerous lists of names, Social Security numbers, and birth dates of victims which were used to file tax returns. They also found tax forms with victims’ signatures taped onto the forms to make it look like the victims had authorized the tax returns. In reality, Davis and his co-conspirators had cut the signatures from the “stimulus” applications and taped them to the tax forms to make their business appear legitimate if anyone asked any questions. When agents first entered the business to execute the search, Davis fled out of the back of the building and was arrested with the assistance of Clayton County law enforcement.
Davis also faxed a fraudulent Georgia driver’s license and tax forms to a Texas detective in 2012, when the detective asked questions about a tax return Davis had fraudulently filed in a Texas victim’s name. Davis falsely represented that the license had been given to him by the taxpayer. Numerous text messages were also introduced at trial where co-conspirators sent Davis names and Social Security numbers, including from prisoners, for use in the scheme.
Davis, 28, of Stockbridge, Ga., was sentenced by United States District Judge Charles A. Pannell, Jr. to 21 years and seven months in federal prison and three years of supervised release, and ordered to pay $7 million in restitution. On December 12, 2013, a jury convicted Davis of one count of conspiracy, 15 counts of wire fraud, and 15 counts of aggravated identity theft. Over 20 victims testified at trial. Davis was detained after the verdict.
On January 9, 2014, Sonnier, 45, of Ellenwood, Ga. was sentenced to eight years in prison and three years of supervised release, and ordered to pay $7 million in restitution. The Court also ordered Sonnier to forfeit his interest in 17 separate pieces of real estate located throughout Clayton County, thousands of dollars that were previously seized from his bank accounts, and over 80 electronic devices and items of jewelry that were previously seized by the government. Sonnier pleaded guilty on May 22, 2013, to conspiracy, wire fraud, and aggravated identity theft.
On November 20, 2013, Jefferson, 48, pleaded guilty to conspiracy for her role in the scheme. Her sentencing is scheduled for March 19, 2014, before Judge Pannell.
This case was investigated by Special Agents of the Internal Revenue Service Criminal Investigation and Postal Inspectors with the United States Postal Inspection Service. If you believe you may be a victim of tax return-related identity theft, please contact the IRS Identity Protection Specialized Unit at 800-908-4490, extension 245 (Mon. - Fri., 7 a.m. - 7 p.m. local time).
Assistant United States Attorneys Stephen H. McClain and Thomas J. Krepp are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Information Office at [email protected] or (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney’s Office for the Northern District of Georgia is www.justice.gov/usao/gan.
Staten Island Man Admits Role in New Jersey Cigarette HeistRead the Press Release
Plea Stems from an FBI Undercover Sting Operation
NEWARK, N.J. – A Staten Island, N.Y., man admitted today his role in the theft of a trailer containing 270 cases of counterfeit cigarettes that were part of an FBI undercover sting, U.S. Attorney Paul J. Fishman announced.
Augustine “Augie” Guido, 73, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to an information charging him with conspiracy to commit cargo theft. Guido and seven other conspirators were previously arrested and charged by complaint on Dec. 19, 2012. Guido was released on a $100,000 bond after his arrest.
According to documents filed in this case and statements made in court: A cooperating witness (CW One) secretly wore a recording device and consensually recorded conversations with various people. CW One assisted federal agents in multiple districts by providing material information, intelligence, and evidence concerning members and associates of La Cosa Nostra and their criminal activities.
On Jan. 27, 2010, CW One and Guido attended a funeral in New York. Guido engaged in a consensually recorded conversation with CW One, asking if CW One was aware of any warehouses that they could rob. Guido said he was interested in stealing perfume, cigarettes and pharmaceuticals.
CW One participated in an FBI sting operation in which Guido and others conspired and stole a tractor-trailer loaded with 270 cases of counterfeit Pall Mall and Lucky 7 cigarettes. The cigarettes were placed in the back of a tractor-trailer at a locked trucking facility in Edison, N.J. Federal agents placed video cameras and other evidence gathering equipment in and around the facility.
On various occasions before July 31, 2010, Guido and his conspirators met to discuss the plan to steal the cigarettes. These meetings were consensually recorded by CW One.
On July 31, 2010, law enforcement officers conducting surveillance near the Edison location observed Guido and his conspirators unlawfully enter the trucking facility. The conspirators, who were wearing masks, drove a tractor into the facility, attached it to a trailer full of cigarettes, and then departed the facility. Guido used a hand-held walkie-talkie to communicate with other members of the conspiracy during the heist. The trailer was dropped off at a warehouse located in Perth Amboy, N.J. Law enforcement officers executed a search warrant at the warehouse and recovered 52 full boxes, with each box containing approximately 50 cartons of the cigarettes.
At the plea hearing, Guido admitted his involvement in the conspiracy to steal the cigarettes from the Edison trucking facility, including planning the theft with other individuals over several months.
Two other conspirators, John S. Dicrescento, 33, of Staten Island, and Anthony Gerbino, 52, of North Valley Stream, N.Y., also pleaded guilty to their roles in the heist. Charges against the other five defendants are still pending.
The conspiracy charge to which Guido pleaded guilty is punishable by a maximum potential penalty of five years in prison and a $250,000 fine. Guido is scheduled to be sentenced June 4, 2014.
U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, for the investigation leading to today’s guilty plea. He also thanked the N.J. State Police; IRS-Criminal Investigation; the U.S. Department of Labor; the Waterfront Commission of New York Harbor; N.J. State Commission of Investigation; and the Bayonne Police Department for their roles in the investigation.
As to the remaining defendants, the charges and allegations contained in the complaints are merely accusations, and they are presumed innocent unless and until proven guilty.
The government is represented by Assistant U.S. Attorneys David M. Eskew and Anthony Moscato of the New Jersey U.S. Attorney’s Office Criminal Division in Newark.14-050
Defense Counsel: Roy B. Greenman Esq, Union, N.J.Guido, Augustine Information
Southern Oregon Career Felon Sentenced to 15 Years Federal Prison for Possessing Firearms and MethamphetamineRead the Press Release
MEDFORD, Ore. - On Tuesday, February 18, 2014, U. S. District Judge Michael McShane sentenced Allen Donn Richins, 53, of Trail, Oregon, to 15 years in federal prison for felon in possession of a firearm and possession of methamphetamine with intent to distribute.
During the late evening on August 9, 2012, Jackson County Sheriff deputies went to defendant’s rural property in Trail, Oregon, to investigate a reported accidental shooting. They found defendant’s car in the driveway, the front door to his house wide open, the light and TV on, and a handgun holster and a taser on the entryway floor. The deputies called out but received no response. Deputies conducted a safety sweep of the house, observed two handguns and drug paraphernalia, and obtained a search warrant. They eventually seized 11 ounces of methamphetamine, scales, packaging materials, $5,500 cash, five handguns, and three rifles, including a semi-automatic assault rifle with several loaded high capacity magazines. Defendant apparently fled the area when the deputies arrived. Two weeks later, the deputies tracked defendant to a house in Grants Pass, where the Grants Pass Police surrounded the house and ordered defendant out; defendant surrendered thirty minutes later. Defendant admitted selling methamphetamine and trading methamphetamine for firearms.
Defendant is a multiple convicted felon with six prior burglary convictions in addition to prior felony convictions for possession of methamphetamine in 2011 and 2006, unauthorized use of a vehicle in 1992 and 1989, supplying contraband in 1994, four counts of first degree forgery from 1988 and 1989, and felon in possession of a firearm and theft in 1998. He was previously convicted of felon in possession of a firearm and sentenced to 15 years prison as an Armed Career Criminal in 1993.
This case was investigated by the Jackson County Sheriff’s Office with assistance from the Grants Pass Department of Public Safety, the U.S. Bureau of Alcohol, Tobacco, and Firearms, and the U.S. Drug Enforcement Administration, and was prosecuted by Assistant U.S. Attorney Douglas W. Fong.
Somerset County Woman Sentenced to Probation for Role in Cocaine Distribution SchemeRead the Press Release
JOHNSTOWN, Pa. - A resident of Tire Hill, Pa, has been sentenced in federal court to five years probation, the first three months of which must be served by conditions of home confinement, on her conviction of conspiracy to distribute cocaine, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Nichole L. Rankin, 26.
According to information presented to the court, from Nov. 2011 to July 18, 2012, Rankin conspired to distribute 500 grams or more of cocaine.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Safe Streets Task Force initiative comprised of the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Pennsylvania Attorney General's Office, the Blair County Drug Task Force, the Cambria County Drug Task Force, the Somerset County Drug Task Force, the Roaring Spring Borough Police Dept. and the Paint Township Police Dept. for the investigation leading to the successful prosecution of Rankin.
Shiprock Man Pleads Guilty to Arson Charge Arising Out of Fire at Former Girlfriend’s ResidenceRead the Press Release
ALBUQUERQUE – Dan Curtis Thompson, 32, of Shiprock, N.M., pleaded guilty this morning to a federal arson charge, announced Acting U.S. Attorney Steven C. Yarbrough and John Billison, Director of the Navajo Nation Division of Public Safety.
Thompson and his twin sister, Christina Thompson were arrested in Oct. 2013, on an indictment charging them with willfully and maliciously setting fire to an occupied rental unit at the Navajo Housing Authority in Ojo Amarillo, located on the Navajo Indian Reservation, on Jan. 9, 2013.
This morning, Thompson pled guilty to the indictment and admitted setting fire to his former girlfriend’s residence on Jan. 9, 2013. In his plea agreement, Thompson admitted that he had resided in the victim’s apartment until the victim ejected him after he had a “forceful physical interaction” with the victim. Thompson admitted that as his resentment towards the victim grew, he began putting into place plans to burn her residence. Thompson stated that his sister drove him to the victim’s residence on Jan. 9, 2013, where he shattered a window so he could unlock the door and enter the residence. Once inside, Thompson poured gasoline in the residence; after igniting the gasoline, Thompson fled from the residence with his sister’s assistance.
In his plea agreement, Thompson admitted that he did not check to see if anyone was in the residence when he lit the fire. He further admitted that he burned the victim’s residence to retaliate against the victim.
Thompson has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled. At sentencing, Thompson faces a maximum sentence of life imprisonment.
Christina Thompson has entered a not guilty plea to the indictment and remains on conditions of release pending trial, which is currently set for April 14, 2014. The charge against Christina Thompson is merely an accusation and she is presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the Shiprock Division of the Navajo Nation Division of Public Safety and is being prosecuted by Assistant U.S. Attorney Paul H. Spiers. It was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.