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Friday 13 December 2013
Arkansas Man Indicted for Additional RobberiesRead the Press Release
JEFFERSON CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Bella Vista, Ark., man who was previously indicted for robbing Alliant Bank in Blackwater, Mo., has been indicted by a federal grand jury for three additional robberies.
Timothy Patrick Hoyt, 43, of Bella Vista, was charged in a four-count indictment returned by a federal grand jury in Jefferson City, Mo., on Wednesday, Dec. 11, 2013. This superseding indictment replaces the original indictment, returned on Nov. 7, 2013, that charged Hoyt with stealing $5,123 from Alliant Bank on June 26, 2013.
The superseding indictment alleges that Hoyt robbed the Subway restaurant at 330 N. Massey Blvd., Nixa, Mo., on July 12, 2013; the Subway restaurant at 1820 W. 32nd St., Joplin, Mo., on July 14, 2013; and the Sally Beauty Supply Store at 2007-C W. Foxwood Dr., Raymore, Mo., on Aug. 6, 2013.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Supervisory Assistant U.S. Attorney Lawrence E. Miller. It was investigated by FBI, the Cooper County, Mo., Sheriff’s Department and the Altoona, Iowa, Police Department, the Nixa, Mo., Police Department, the Joplin, Mo., Police Department and the Raymore, Mo., Police Department.
Arizona-Based Man Sentenced for Role in Multi-State Cocaine Distribution ConspriacyRead the Press Release
NORFOLK, Va. – Luis Alberto Navarro, 33, of Tucson, Arizona, was sentenced today to 360 months in prison, followed by 5 years of supervised release, for his role in a cocaine distribution conspiracy. He was also ordered to forfeit $300,000.00 in cash seized in connection with his arrest in June 2013, along with his interest in a home located in Rio Rico, Arizona, which was affiliated with the conspiracy.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, made the announcement after sentencing by United States District Judge Arenda L. Wright Allen.
Navarro pleaded guilty on September 10, 2013. According to court documents, since approximately 2006, Navarro was a member of a large-scale cocaine distribution conspiracy with a far-reaching distribution network that spanned from Virginia to New York, Pennsylvania, Indiana, Arizona, and other locations. The group concealed the cocaine for distribution and the proceeds from the sale of the drugs by secreting both inside the lining of coolers and inert, hollowed-out fire extinguishers to avoid detection during transportation. Navarro ran the Tucson, Arizona hub of the organization where he recruited others to assist in the distribution of cocaine. He was held responsible today for his role in the distribution of over 160 kilograms of cocaine.
This case was investigated by the Drug Enforcement Administration, the Federal Bureau of Investigation, and the Tucson Police Department. Assistant United States Attorneys V. Kathleen Dougherty and Kevin M. Comstock prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Andalusia Man Sentenced for Child Sex OffensesRead the Press Release
TALLAHASSEE, FLORIDA – David Daniel Hicks, Jr., 42, of Andalusia, Alabama, was sentenced today to serve 200 months in prison for the use of a facility of interstate commerce to entice a minor to engage in sexual activity, interstate travel for illicit sexual conduct, and production of child pornography. Hicks was sentenced to a lifetime term of supervised release after his incarceration. He is required to register as a sex offender, to complete sex offender treatment, to submit to monitoring of any computer or electronic accounts, to avoid unsupervised contact with children, and to inform future employers of his convictions.
Hicks was arrested on April 12, 2013, after traveling from Andalusia to Tallahassee to have sex with what he thought was a fourteen-year-old boy. His arrest was part of a larger undercover investigation conducted by a coalition of law enforcement agencies. Following the arrest, investigators served a search warrant at Hicks’ Alabama residence and found tens of thousands of images of child pornography, including five computer videos of Hicks performing sexual acts on an adolescent male. These videos were created in that residence, with a camera that was seized there.
The solicitation and travel charges were indicted in the Northern District of Florida. The production charge was indicted in the Middle District of Alabama, but transferred to the Northern District of Florida for disposition and sentencing. Hicks entered guilty pleas to all charges against him. Hicks also agreed to forfeit the electronic devices and electronic media that were seized under the search warrant.
In announcing the sentence imposed by the court, United States Attorney Pamela C. Marsh credited the success of this prosecution to the joint efforts of the agencies participating in the North Florida Internet Crimes Against Children Task Force, particularly the U.S. Immigrations and Customs Enforcement, the Tallahassee Police Department, the Leon County Sherriff’s Office, and the Covington County, Alabama Sherriff’s Office.
The case was prosecuted by Assistant United States Attorneys Michael T. Simpson (NDFL) and Jared Morris (MDAL).
This case was brought as part of Project Safe Childhood, a nationwide initiative launched by the Department of Justice in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. Led by 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 exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Thursday 12 December 2013
Westmoreland County Man Sentenced to Probation with Home Detention for Conspiring to Distribute CocaineRead the Press Release
JOHNSTOWN, Pa. - A resident of Claridge, Pa., has been sentenced in federal court to five years probation, the first 12 months of which must be served by conditions of home confinement, 500 hours of community service and a $5,000 fine on his 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 Donald S. Swanger, 44.
According to information presented to the court, from July 2008 to May 10, 2011, Swanger conspired to distribute and possess with the intent to distribute five kilograms or more of cocaine.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
A joint task force, headed by the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, conducted the investigation that led to the prosecution of Swanger. Other agencies participating on the task force include the Internal Revenue Service-Criminal Investigation, Pennsylvania State Police, Pennsylvania Attorney General's Office, Cambria County District Attorney's Office, Carrolltown Police Department, Patton Police Department, Ebensburg Police Department, Portage Police Department and the Paint Township Police Department.
Ukrainian National Who Co-founded Cybercrime<br /> Marketplace Sentenced to 18 Years in PrisonRead the Press Release
One of the world’s most prolific cybercriminals was sentenced today to serve 18 years in prison for his role in co-founding the notorious website CarderPlanet. At the time of his arrest, Vega possessed more than half a million stolen credit card numbers.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Loretta E. Lynch of the Eastern District of New York, and Special Agent in Charge Steven G. Hughes of the U.S. Secret Service’s New York Field Office made the announcement after sentencing by Senior U.S. District Judge Allyne R. Ross of the Eastern District of New York.
Roman Vega, 49, a Ukrainian national, pleaded guilty in 2009 to conspiracies to commit money laundering and access device fraud. According to court documents, Vega – who at various times was also known as “Boa,” “Roman Stepanenko” and “Randy Riolta” – conspired with others to steal large volumes of credit card information through hacking and other sophisticated means, and then sold that stolen information to others, who ultimately used the information to purchase merchandise and services. Vega founded two different online marketplaces for this stolen credit card information.
“Today’s sentence is a significant milestone in our ongoing effort to aggressively target and dismantle global cybercrime organizations that operate from every corner of the world,” said Acting Assistant Attorney General Raman. “Vega helped create one of the largest and most sophisticated credit card fraud sites in the cybercrime underworld – a distinction that has earned him the substantial sentence he received today.”
“The defendant and his group of cybercriminals emulated the mafia in organizing their criminal operations,” said U.S. Attorney Lynch. “Now, the defendant shares the same fate as so many mafia bosses – a long term of imprisonment. This investigation has spanned the globe and should send the unmistakable message that when it comes to dismantling global cybercrime organizations, we will not be held back by distance or complexity.”
“The Secret Service is pleased to have participated in this multi-agency criminal investigation that lead to the arrest of Roman Vega also known as ‘Boa’,” said Secret Service Special Agent in Charge Hughes. “This case demonstrates by constricting this criminal enterprise, there is no such thing as anonymity in the cyber world. The Secret Service continues to seek new and innovative ways to combat emerging cyber threats. Our success in this case and other similar investigations is a result of our close work with our network law enforcement partners.”
In the late 1990s, Vega founded the Boa Factory, one of the earliest websites to provide a forum for sellers of stolen credit card information to meet potential buyers. In the early 2000s, he co-founded and became a high-ranking administrator of a second criminal website, CarderPlanet, which became one of the first and busiest online marketplaces for the sale of stolen financial information, computer hacking services and money laundering.
At its height, CarderPlanet had more than 6,000 members and had a hierarchical leadership structure that borrowed its leadership titles from La Cosa Nostra. For example, CarderPlanet was headed by a “Godfather.” Immediately below the Godfather were a number of “Dons,” including the defendant, who used the name “Boa” when serving in this role. Three levels below the Dons was the “Consigliere,” who was an advisor. Vega, using the name “RioRita,” also served as the Consigliere.
CarderPlanet became a premier online criminal bazaar in significant part as a result of Vega’s leadership. Most notably, the defendant helped institute a quality control system for sales. If a cyberthief wanted to sell stolen credit card information on CarderPlanet, the information was subjected to a vetting process overseen by a manager to ensure that buyers obtained usable stolen data. In addition, the website used e-currencies, such as WebMoney, to provide the participants with security and a layer of anonymity. Vega and his co-conspirators thus created an efficient and trustworthy online marketplace for the buyers and sellers of stolen financial information not unlike legitimate e-commerce sites.
Vega also sold stolen data on the marketplaces he founded and managed. He directed cells of cybercriminals located throughout the globe who hacked into financial institutions to steal credit card and other financial information that would in turn be sold on carding forums, including CarderPlanet. Vega’s criminal career was cut short when he was arrested in Cyprus in February 2003 and extradited to the Northern District of California for prosecution. In November 2007, Vega was transferred to the Eastern District of New York following his indictment on the instant charges, and he pleaded guilty in January 2009. Vega has been incarcerated continuously since 2003.
The case was investigated by the U.S. Secret Service, with assistance from the U.S. Postal Inspection Service. The case was prosecuted by Senior Counsel Thomas Dukes of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney William P. Campos of the Eastern District of New York.Ukrainian National Who Co-Founded Cybercrime Marketplace Sentenced to 18 Years in PrisonRead the Press Release
BROOKLYN, NY – Earlier today, at the federal courthouse in Brooklyn, New York, Roman Vega, one of the world’s most prolific cybercriminals, was sentenced to 18 years in prison. Vega, a Ukrainian national who co-founded the notorious Internet website CarderPlanet, pled guilty in 2009 to conspiracies to commit money laundering and access device fraud. At the time of his arrest, Vega possessed over half a million stolen credit card numbers.
The sentence was announced today by Loretta E. Lynch, the United States Attorney for the Eastern District of New York; Acting Assistant Attorney General Mythili Raman of the Criminal Division of the Department of Justice; and Steven G. Hughes, Special Agent in Charge, United States Secret Service, New York Field Office.
“Roman Vega and his cybercriminal associates emulated the mafia in organizing their criminal operations,” stated United States Attorney Lynch. “Now, he shares the same fate as so many mafia bosses – a long term of imprisonment. This investigation spanned the globe and sends the unmistakable warning that when it comes to dismantling global cybercrime organizations, neither distance nor complexity will deter us and our partners in law enforcement.” Ms. Lynch expressed her grateful appreciation to the United States Postal Inspection Service for its assistance.
“Today’s sentence is a significant milestone in our ongoing effort to aggressively target and dismantle global cybercrime organizations that operate from every corner of the world,” said Acting Assistant Attorney General Raman. “Vega helped create one of the largest and most sophisticated credit card fraud sites in the cybercrime underworld – a distinction that has earned him the substantial sentence he received today.”
“The Secret Service is pleased to have participated in this multi-agency criminal investigation that lead to the arrest of Roman Vega also known as ‘Boa’,” said Secret Service Special Agent in Charge Hughes. “This case demonstrates by constricting this criminal enterprise, there is no such thing as anonymity in the cyber world. The Secret Service continues to seek new and innovative ways to combat emerging cyber threats. Our success in this case and other similar investigations is a result of our close work with our network law enforcement partners.”
Vega, who at various times was also known as “Boa,” “Roman Stepanenko,” “Randy Riolta,” and “RioRita,” formed two online marketplaces for stolen credit card information. In the late 1990s, he founded the Boa Factory, one of the earliest websites on the Internet to provide a forum for buyers and sellers of stolen credit card information. In the early 2000s, he co-founded and became a high-ranking administrator of a second criminal website, CarderPlanet, which became one of the first and busiest online marketplaces for the sale of stolen financial information, computer hacking services, and money laundering.
At its height, CarderPlanet had more than 6,000 members and had a hierarchical leadership structure that borrowed its leadership titles from La Cosa Nostra. For example, CarderPlanet was headed by a “Godfather.” Immediately below the Godfather were a number of “Dons,” including Vega, who used the name “Boa” when serving in this role. Two levels below the Dons was the “Consigliere,” who was an advisor. Vega, using the name “RioRita,” also served as the Consigliere.
CarderPlanet quickly became a premier online criminal bazaar in significant part as a result of Vega’s leadership. Most notably, he helped institute a quality control system for sales. If a cyberthief wanted to sell stolen credit card information on CarderPlanet, the information was subjected to a vetting process overseen by a manager to ensure that buyers obtained usable stolen data. In addition, the website used e-currencies, such as WebMoney, to provide the participants with security and the cloak of anonymity. As a result, Vega and his co-conspirators created an efficient and reliable online marketplace for the buyers and sellers of stolen financial information not unlike legitimate e-commerce sites.
Vega also sold stolen data on the marketplaces he founded and managed. He directed cells of cybercriminals around the globe who hacked into financial institutions to steal credit card and other financial information that would in turn be sold on online marketplaces, including CarderPlanet.
Vega was arrested in Cyprus in February 2003 and extradited to the Northern District of California for prosecution. In November 2007, Vega was transferred to the Eastern District of New York following his indictment on the instant charges. Vega has been incarcerated continuously since 2003.
The sentencing proceeding was held before Senior United States District Judge Allyne R. Ross.
The case was prosecuted by Assistant U.S. Attorney William P. Campos of the Eastern District of New York and Senior Counsel Thomas Dukes of the Criminal Division’s Computer Crime & Intellectual Property Section.
The Defendant:
ROMAN VEGA
Age: 49
UkraineE.D.N.Y. Docket No. CR-07-707 (ARR)
Two Patient Recruiters for Miami Home Health Companies<br /> Sentenced for Roles in $48 Million Health Care Fraud SchemeRead the Press Release
WASHINGTON - Two patient recruiters for Miami health care companies were sentenced today for their participation in a $48 million home health Medicare fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office, and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement after sentencing by U.S. District Judge Joan A. Lenard in the Southern District of Florida.
Elizabeth Monteagudo, 33, of Miami, was sentenced to serve 70 months in prison, followed by three years of supervised release, and ordered to pay $3.5 million in restitution jointly and severally with co-defendants. Cristobal Gonzalez, 39, of Miami, was sentenced to serve 46 months in prison, followed by two years of supervised release, and ordered to pay $2 million in restitution jointly and severally with co-defendants.
In September 2013, Monteagudo and Gonzalez each pleaded guilty to one count of conspiring to receive health care kickbacks. Monteagudo also pleaded guilty to receiving kickbacks in connection with a federal health care program.
According to court documents, Monteagudo and Gonzalez were patient recruiters who worked for Caring Nurse Home Health Care Corp., and Gonzalez also worked for Good Quality Home Health Care Inc. Caring Nurse and Good Quality were Miami home health care agencies that purported to provide home health and therapy services to Medicare beneficiaries.
According to court documents, from approximately January 2009 through approximately June 2011, Monteagudo and Gonzalez would recruit patients for Caring Nurse and/or Good Quality and would solicit and receive kickbacks and bribes from the owners and operators of Caring Nurse and/or Good Quality in return for allowing the agency to bill the Medicare program on behalf of the recruited patients. These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.
Monteagudo also admitted to her involvement with $7 million in fraudulent billings for Starlite Home Health Agency Inc., which she owned and operated.
In a related case, on Feb. 27, 2013, Rogelio Rodriguez and Raymond Aday, the owners and operators of Caring Nurse and Good Quality, were sentenced to serve 108 and 51 months in prison, respectively. Their sentencings followed their December 2012 guilty pleas each to one count of conspiring to commit health care fraud charged in an October 2012 indictment. According to that indictment, from approximately January 2006 through June 2011, Caring Nurse and Good Quality submitted approximately $48 million in claims for home health services that were not medically necessary and/or not provided. Medicare actually paid approximately $33 million for these fraudulent claims.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,700 defendants who collectively have falsely billed the Medicare program for more than $5.5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .Two Patient Recruiters for Miami Home Health Companies Sentenced for Roles in $48 Million Health Care Fraud SchemeRead the Press Release
Two patient recruiters for Miami health care companies were sentenced today for their participation in a $48 million home health Medicare fraud scheme.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office, and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement after sentencing by U.S. District Judge Joan A. Lenard in the Southern District of Florida.
Elizabeth Monteagudo, 33, of Miami, was sentenced to serve 70 months in prison, followed by three years of supervised release, and ordered to pay $3.5 million in restitution jointly and severally with co-defendants. Cristobal Gonzalez, 39, of Miami, was sentenced to serve 46 months in prison, followed by two years of supervised release, and ordered to pay $2 million in restitution jointly and severally with co-defendants
In September 2013, Monteagudo and Gonzalez each pleaded guilty to one count of conspiring to receive health care kickbacks. Monteagudo also pleaded guilty to receiving kickbacks in connection with a federal health care program.
According to court documents, Monteagudo and Gonzalez were patient recruiters who worked for Caring Nurse Home Health Care Corp., and Gonzalez also worked for Good Quality Home Health Care Inc. Caring Nurse and Good Quality were Miami home health care agencies that purported to provide home health and therapy services to Medicare beneficiaries.
According to court documents, from approximately January 2009 through approximately June 2011, Monteagudo and Gonzalez would recruit patients for Caring Nurse and/or Good Quality and would solicit and receive kickbacks and bribes from the owners and operators of Caring Nurse and/or Good Quality in return for allowing the agency to bill the Medicare program on behalf of the recruited patients. These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.
Monteagudo also admitted to her involvement with $7 million in fraudulent billings for Starlite Home Health Agency Inc., which she owned and operated.
In a related case, on Feb. 27, 2013, Rogelio Rodriguez and Raymond Aday, the owners and operators of Caring Nurse and Good Quality, were sentenced to serve 108 and 51 months in prison, respectively. Their sentencings followed their December 2012 guilty pleas each to one count of conspiring to commit health care fraud charged in an October 2012 indictment. According to that indictment, from approximately January 2006 through June 2011, Caring Nurse and Good Quality submitted approximately $48 million in claims for home health services that were not medically necessary and/or not provided. Medicare actually paid approximately $33 million for these fraudulent claims.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,700 defendants who collectively have falsely billed the Medicare program for more than $5.5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Men Sentenced to Prison Terms for 2012 Shooting in Northwest Washington-Bullets Fired into A Block Crowded with Adults and Children-Read the Press Release
WASHINGTON – Carlito Bailey and Rickey Watkins, both 22 and from Washington D.C., were sentenced today to more than a decade in prison on charges stemming from a shooting last year in Northwest Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Bailey and Watkins were found guilty by a jury in October 2013, following a trial in the Superior Court of the District of Columbia, of aggravated assault, assault with a dangerous weapon, and related firearms offenses. The Honorable Robert I. Richter sentenced Bailey to a prison term of 16 ½ years and sentenced Watkins to 11 years and nine months of incarceration.
According to the government’s evidence, on the night of May 5, 2012, Bailey, Watkins, and a third unidentified shooter traveled to Northwest Washington armed with firearms. The three men approached the intersection of Johnson Avenue and R Street NW, where they opened fire, shooting at least ten bullets into a block crowded with adults and children gathered to celebrate a birthday party. One of the adults was shot several times in the legs. After firing the shots, the men fled on Johnson Avenue.
Bailey and Watkins were apprehended approximately 24 minutes after the shooting in a car with two firearms. One of the firearms was a ballistics match to six shell casings and a bullet from the crime scene, and a swab from the slide of that weapon yielded DNA that matched the DNA profile of Bailey. Cell site data placed Watkins at the scene of the shooting.
In announcing the sentences, U.S. Attorney Machen praised the work of the Metropolitan Police Department Second District officers who apprehended the defendants and recovered the key evidence shortly after the shooting, as well as the Third District detectives who investigated the case. He also expressed appreciation to FBI Special Agent Kevin Horan for his valuable work analyzing cell phone records and testifying as a government expert at trial.
In addition, U.S. Attorney Machen commended those who handled the case for the U.S. Attorney’s Office, including Litigation Technology Specialists Joe Calvarese, Kimberly Smith and Ron Royal and Paralegal Specialists Allison Daniels and Mia Beamon. Finally, he acknowledged the efforts of Assistant U.S. Attorney Ephraim (Fry) Wernick and former Assistant U.S. Attorney Mary Chris Dobbie, who indicted the case, and Assistant U.S. Attorneys Ann Carroll and Jonathan Kravis, who prosecuted the case.
13-417Two Indicted for Stolen Treasury ChecksRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announces that Jatin Patel, 42, and Donna Evans Moore, a/k/a Donna Evans Furguson, 38, both from Tifton, Georgia, were indicted by a Federal Grand Jury sitting in Macon, Georgia on December 10, 2013, for Conspiracy to Possess Stolen U.S. Treasury Checks, Passing Forged Securities and Embezzling Public Monies (Count One); Embezzling Government Property (Counts Two-Seven) and Aggravated Identity Theft (Counts Eight-Thirteen). A copy of the indictment is attached. The two were both arrested on December 11, 2013, and were arraigned in in federal court in Albany on that day.If convicted, the defendants face the following penalties: Count One, up to 5 years imprisonment and a $250,000 fine; Counts Two-Seven, up to 10 years imprisonment and a $250,000 fine; Counts Eight-Thirteen, 2 years imprisonment consecutive to any other penalty and a $250,000 fine.
Atlanta SAIC Reginald Moore, said, “ The U.S. Secret Service, along with its local law enforcement partners, will continue to vigorously investigate the negotiation of U.S. Treasury checks generated from Identity Theft.”
An indictment is only an accusation, and each defendant is presumed innocent until proven guilty beyond a reasonable doubt at trial.
The case was investigated by the United States Secret Service and the Tift County Sheriff’s Office. The case is being prosecuted by Assistant United States Attorney Robert D. McCullers.For additional information please contact Pamela Lightsey, Public Information Officer, United States Attorney’s Office at (478) 621-2603.
Two Chicago Real Estate Executives Indicted on Federal Fraud Charges Involving City Tif Notes and Bank LoansRead the Press Release
CHICAGO — Two executives of a prominent Chicago real estate development company were indicted today on federal fraud charges alleging that they lied about and concealed unpaid property taxes, the double-pledging of public financing notes issued by the City of Chicago, and the company’s default on those notes so they could secure credit extensions and payments from the city at a time when they knew their firm was having serious financial difficulties. The defendants, LAURANCE H. FREED, and CAROLINE WALTERS, are, respectively, the president and vice president/treasurer of Joseph Freed and Associates LLC (JFA), best known for its role in the development of Block 37 in Chicago’s Loop.
The charges involve, in part, two Tax Increment Financing (TIF) notes that the City of Chicago agreed to issue in November 2002 to finance redevelopment of the former Goldblatt’s department store in the 4700 block of North Broadway in the city’s Uptown neighborhood. Freed was manager of a limited liability company, formed by JFA, called Uptown Goldblatts Venture LLC, which received a $4.3 million TIF redevelopment area note and a $2.4 million TIF project note from the city to help finance the project.
Freed, 51, of Chicago, and Walters, 53, of Palatine, were each charged with seven counts of bank fraud, one count of mail fraud, and five counts of making false statements to banks in a 14-count indictment returned today by a federal grand jury. The indictment also seeks forfeiture of $2,995,295 in alleged fraud proceeds from both defendants, who will be arraigned at a later date in U.S. District Court.
The indictment alleges three victims: the City of Chicago, Cole Taylor Bank, and a consortium of banks consisting of Bank of America (as successor to the former LaSalle Bank National Association), Associated Bank, Northern Trust, and Wachovia Bank.
According to the indictment, between March 2008 and February 2011 ― when JFA was in the midst of a severe liquidity crisis that jeopardized its ability to pay operating expenses and Freed and Walters knew the possibility that JFA’s inability to make required payments threatened the company’s future ― both defendants made false statements to the city and the banks to obtain funds. Freed and Walters allegedly made false statements:
- to the bank consortium to prevent default on a $105 million line of credit and to obtain a loan modification that would have provided JFA with at least $10 million in additional funds;
- to Cole Taylor Bank regarding the defendants’ intent to persuade the bank consortium to release its claim on the TIF notes as collateral; and
- to the City of Chicago to obtain nearly $1.75 million in payments from the TIF notes, knowing that the bank consortium and Cole Taylor were entitled to those payments.
As background, the indictment details various financial agreements involving JFA and its related entities, including:
- Uptown Goldblatts’ November 2002 TIF agreement with the city contained several conditions guaranteeing that Uptown Goldblatts would not default on its obligations, and, if the conditions were violated, the city would not be obligated to make TIF payments. The city began paying annual principal and interest on the notes after receiving an annual sworn statement from JFA certifying that it was in compliance with the conditions;
- Also in November 2002, Freed, on behalf of Uptown Goldblatts, entered into an agreement with Cole Taylor Bank for a $15 million loan in exchange for Uptown Goldblatts’ assignment to the bank of its rights in the TIF project note. Uptown Goldblatts would receive the annual proceeds from the note so long as it was not in default to the bank, but if it was in default, the bank would be entitled to the proceeds. The loan agreement also forbid Uptown Goldblatts from pledging the TIF note as collateral for any other loan and specified that doing so would constitute default to Cole Taylor Bank. The loan amount was later reduced from $15 million to $9 million; and
- In May 2006, a JFA associated entity, DDL LLC and Freed Illinois Holdings LLC, entered into agreements with the bank consortium, now led by Bank of America, for a revolving line of credit up to $150 million. In exchange, Freed’s entities pledged properties known as Evanston Plaza and West Town Center as collateral, and Freed personally guaranteed the loan for up to $50 million. In November 2007, Uptown Goldblatts entered into a security agreement with the bank consortium, pledging both TIF notes and their proceeds as collateral for the line of credit. Uptown Goldblatts warranted that the notes were free of any other outside interests, despite knowing that the project note had been previously pledged to Cole Taylor. The security agreement, signed by Freed, further provided that Uptown Goldblatts would direct all payments from the TIF notes to a Bank of America lockbox.
Freed and Walters allegedly made false statements to the bank consortium and Cole Taylor Bank about the collateral, as well as to the city about default and misappropriation of the TIF funds. These included concealing from the bank consortium Uptown Goldblatts’ prior pledge of the project note to Cole Taylor Bank, and making false statements and omissions to the consortium while trying to obtain a loan modification of at least $10 million and to prevent default on a $105 million line of credit. Between December 2008 and July 2009, Freed and Walters made four presentations to the bank consortium, allegedly knowing they contained multiple false statements and that Cole Taylor Bank had a superior interest in the TIF project note. Both defendants also made false statements about the Evanston Plaza and West Town Center developments, including concealing that JFA owed unpaid property taxes in April 2009 of at least $1.325 million on Evanston Plaza and at least $590,000 on West Town Center, the indictment alleges.
In December 2008, 2009, and 2010, Freed signed allegedly false affidavits to obtain TIF payments from the city, knowing instead that the bank consortium and Cole Taylor Bank were entitled to the payments. The indictment alleges he also falsely swore that no default condition existed, despite knowing that the double pledge of the project note as collateral to Cole Taylor Bank and the bank consortium had triggered Uptown Goldblatts’ default to the city. Further, Freed and Walters allegedly took steps to ensure that the TIF payments would be delivered directly to JFA and bypass the lockbox to prevent Bank of America from keeping the payments.
Each count of the indictment carries a maximum penalty of 30 years in prison and a $1 million fine, and restitution is mandatory. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Robert J. Holley, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Joseph Ferguson, Inspector General for the City of Chicago.
The government is being represented by Assistant U.S. Attorney Renato Mariotti.
An indictment contains merely charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Two Agricultural Scientists from ChinaCharged with Stealing Trade SecretsRead the Press Release
KANSAS CITY, KAN. – Two agricultural scientists from China have been charged with trying to steal samples of a variety of seeds from a biopharmaceutical company’s research facility in Kansas, U.S. Attorney Barry Grissom said today.
Weiqiang Zhang, 47, Manhattan, Kan., and Wengui Yan, 63, Stuttgart, Ark., are charged with one count of conspiracy to steal trade secrets. The victim in the case – identified in court records as Company A -- has invested approximately $75 million in patented technology used to create a variety of seeds containing recombinant proteins. The company has an extensive intellectual property portfolio of more than 100 issued and pending patents and exclusive licenses to issued patents.
Zhang and Yan are charged in a criminal complaint filed in U.S. District Court in Kansas City, Kan. An affidavit in support of the complaint alleges that on Aug. 7, 2013, agents of U.S. Customs and Border Protection found stolen seeds in the luggage of a group of visitors from China preparing to board a plane to return home. While in the United States, the group had visited various agricultural facilities and universities in the Midwest, as well as the Dale Bumpers National Rice Research Center in Stuttgart, Ark.
According to the complaint:
- Zhang and Yan, both natives of the People’s Republic of China living lawfully in the United States, arranged for the Chinese delegation to visit the United States in 2013. Previously, the two had traveled to China at the same time in 2012 to visit a Crops Research Institute. Some of the people they met in China were members of the Chinese delegation that visited the United States in 2013.
- Zhang, worked as an agricultural seed breeder for Company A since 2008.
- Stolen seeds were delivered to members of the Chinese delegation during the delegation’s visit to the United States July 16 through August 7, 2013.
- Yan, who worked for the U.S. Department of Agriculture as a rice geneticist at the Dale Bumpers National Rice Research Center, picked up the Chinese delegation from a motel in Stuttgart, Ark., on July 22, 2013, and took them to the center.
- Seeds similar to what were found in the delegation’s possession as they left the United States in August 2013, were also found in Zhang’s residence on December 11, 2013.
If convicted, Zhang and Yan face a maximum penalty of 10 years in federal prison and a fine up to $250,000. The Little Rock Field Office of the Federal Bureau of Investigation, the Kansas City Field Office of the Federal Bureau of Investigation and U.S. Customs and Border Protection investigated. Assistant U.S. Attorney Scott Rask is prosecuting with assistance from the U.S. Attorney’s Office in the Eastern District of Arkansas.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Twenty-Four Plead Guilty to Trafficking Drugs in Dona Ana CountyRead the Press Release
ALBUQUERQUE – Javier Castruita, 45, of Anthony, N.M., entered a guilty plea yesterday to cocaine trafficking charges in federal court in Las Cruces, N.M. His guilty plea resolves the last remaining case charged as a result of a multi-agency investigation that culminated in the filing of drug trafficking charges against 28 residents from Doña Ana County, N.M., and El Paso County, Texas, last spring.
Castruita and 27 others were charged in 12 criminal complaints with distributing cocaine, heroin, methamphetamine and marijuana in and around southern Doña Ana County. The criminal complaints were unsealed on May 8, 2013, following a multi-agency arrest operation resulting in the arrests of 22 defendants. Five others subsequently were arrested, leaving one fugitive.
The charges against the defendants were the result of an intensive four-month multi-agency investigation led by the FBI’s Las Cruces Cross-Border Drug Violence Hybrid Squad and Southern New Mexico Gang Task Force that targeted known drug dealers in southern Doña Ana County. The U.S. Border Patrol and the Las Cruces- Doña Ana County Metro Narcotics Agency, which is comprised of officers from the New Mexico State Police, the Doña Ana County Sheriff’s Office and the Las Cruces Police Department, participated in the investigation. During the course of the investigation, officers oversaw approximately 40 covert drug buys and the purchase of five firearms from the defendants.
The investigation was designated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program, a nationwide Department of Justice program that combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations.
Yesterday’s guilty plea was the 24th guilty plea entered by defendants arrested as a result of the investigation. The charges against one of the remaining three defendants were dismissed in support of his prosecution on more significant methamphetamine trafficking charges in the Western District of Texas. Charges against the other two were dismissed with leave to refile.
The cases were investigated by the FBI’s Las Cruces Cross-Border Drug Violence Hybrid Squad, the Las Cruces- Doña Ana County Metro Narcotics Agency, the U.S. Border Patrol and the Dona Doña County Sheriff’s Office. They are being prosecuted by Assistant U.S. Attorneys Shaheen P. Torgoley and Sarah M. Davenport of the U.S. Attorney’s Las Cruces Branch Office.
CASE SUMMARIES
Castruita and his two co-defendants Gloria Portillo Valdivia, 51, and Carlos Alberto Valdivia, 56, both of Anthony, N.M., were charged with cocaine trafficking offenses. Portillo Valdivia pled guilty on Sept. 12, 2013, and was sentenced on Dec. 4, 2013 to ten months in prison followed by three years of supervised release. Valdivia pled guilty on Oct. 4, 2013, under a plea agreement that requires the imposition of an 84-month prison sentence. Castruita, who pled guilty this morning, faces a maximum penalty of 20 years in prison at sentencing.
Abel Romero, 29, of Anthony, N.M., Victor Cano, 30, of Anthony, N.M., and Jaime Cano, 30, of Canutillo, Texas, were charged with cocaine and marijuana trafficking offenses. Romero also was charged with being a felon in possession of a firearm. Victor Cano pled guilty on Nov. 7, 2013, under a plea agreement that requires the imposition of a sentence in the range of 30 to 37 months in prison. Jaime Cano also pled guilty on Nov. 7, 2013, under a plea agreement that requires the imposition of a sentence in the range of 40 to 60 months in prison. On Dec. 5, 2013, Romero pled guilty under a plea agreement that requires the imposition of a 131 month prison sentence.
Noe Perez-Rodriguez, 46, of Berino, N.M., and Larry Valles, Sr., 50, of Los Lunas, N.M., each pled guilty on Sept. 12, 2013, to methamphetamine trafficking charges. At sentencing, each faces a sentence of not less than five years and not more than 40 years in prison.
Rudy Portillo, 54, and Isaiah Portillo, 20, both of Anthony, N.M., and Victor Leos, 53, of Anthony, Texas, were charged with heroin trafficking offenses. Isaiah Portillo and Leos entered guilty pleas on Oct. 11, 2013 and Oct. 24, 2013, respectively, and Rudy Portillo pled guilty on Dec. 5, 2013. At sentencing, Rudy Portillo and Leos each faces a sentence of not less than five years and not more than 40 years in prison, and Isaiah Portillo faces a maximum penalty of 20 years in prison.
Victor Alvarez, 43, of Las Cruces, N.M., and Benjamin Ochoa, 31, of Las Cruces, N.M., pled guilty to cocaine trafficking charges on Oct. 31, 2013 and Nov. 7, 2013, respectively. Each faces a maximum penalty of 20 years in prison at sentencing.
Daniel Arrieta, 38, of Anthony, N.M., pled guilty to a heroin trafficking charge on Dec. 5, 2013, and faces a maximum penalty of 20 years in prison at sentencing.
Michael Vega, 26, and Raul Martinez, 25, both of Anthony, N.M., were charged with cocaine trafficking offenses. Vega pled guilty on Nov. 21, 2013, and faces a maximum penalty of 20 years in prison at sentencing. The charges against Martinez were dismissed without prejudice on Nov. 26, 2013.
John Eric Sapien, 25, of Anthony, N.M., pled guilty to a cocaine trafficking charge on Sept. 20, 2013, and faces a maximum penalty of 20 years in prison at sentencing.
Jose Salcido, 51, of Anthony, N.M., pled guilty to a cocaine trafficking charge, and faces a maximum penalty of 20 years in prison at sentencing. The charges against his co-defendant Gerardo Garcia, 63, who was the sole fugitive, were dismissed following his deportation to Mexico.
Joey Martinez, 29, and Eloy Rios-Montoya, 40, both of Anthony, Texas, pled guilty to cocaine trafficking charges on Sept. 5, 2013 and Sept. 20, 2013, respectively. Each faces a maximum penalty of 20 years in prison at sentencing.
Freddy Sanchez-Ramirez, 56, of Anthony, N.M., and Roberto Andres Urquidi, 34, of Canutillo, Texas, pled guilty to heroin trafficking charges on Sept. 20, 2013 and Nov. 7, 2013, respectively. Each faces a maximum penalty of 20 years in prison at sentencing.
Jesus M. Baeza-Lascano, 44, of Anthony, N.M., pled guilty to a cocaine trafficking charge on July 23, 2013, and was sentenced to ten months in prison on Oc. 22, 2013. Baeza-Lascano, a Mexican national, will be deported after he completes his prison sentence. The charges against his co-defendant Martin Nevarez, 49, of Anthony, N.M., were dismissed.
Jose Alvarez, 27, of Anthony, N.M., and Angel Herrera, 31, of Berino, N.M., each pled guilty on Sept. 12, 2013, to a felony information charging them with a heroin trafficking conspiracy. Each was sentenced to time-served and two years of supervised release.
Treasure Coast Robbers That Targeted Gas Stations and Hotels IndictedRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Hugo Barrera, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office, Julie Leon, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Tampa/Orlando Field Office, Deryl Loar, Sheriff, Indian River County Sheriff’s Office, Wayne Ivey, Sheriff, Brevard County Sheriff’s Office, John A. Bolduc, Chief, Port St. Lucie Police Department, and Frank J. Kitzerow, Chief, Jupiter Police Department, announce that defendants Yubran Alvarez Vasquez, 21, of Bluffton, South Carolina, and Matthew Emmanuel Vasquez, 23, of Savannah, Georgia, were indicted by a federal grand jury in Fort Pierce, on one count of conspiracy to commit armed robbery, in violation of Title 18, United States Code, Section 1951(a), four counts of armed robbery, in violation of Title 18, United States Code, Section 1951(a), and four counts of possessing, brandishing, and discharging a firearm in furtherance of a crime of violence, in violation of Title 18, United States Code, Section 924(c)(1)(A)(ii & iii).
The defendants are alleged to have targeted gas stations and hotels just off exits on I-95 from Melbourne to Jupiter. In one robbery spree on February 14-15, 2013, the defendants are alleged to have robbed at gunpoint two gas stations and two hotels. The defendants brandished guns in all of the robberies and during the robbery of the Holiday Inn Express in Vero Beach, a firearm was discharged. The defendants wore gloves and masks and changed hotels frequently in an attempt to avoid detection.
The defendants fled Florida with the stolen property, and due to a multi-agency effort, the defendants were apprehended. If convicted, each defendant faces up to life in prison.
Mr. Ferrer commended the investigative efforts of ATF, the Indian River County Sheriff’s Office, the Brevard County Sheriff’s Office, the Port St. Lucie Police Department, and the Jupiter Police Department. The case is being prosecuted by Assistant U.S. Attorney Russell R. Killinger.
An indictment is only an accusation, and the defendant is presumed innocent until proven guilty.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Three Buffalo Men Charged in Seperate Bank RobberiesRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Michael Tynes, 53, Michael Bland, 18, and Demetrian Bell-Bradley, 22, all of Buffalo, N.Y., were charged in separate indictments with bank robbery. The charge carries a maximum penalty of 20 years in prison, a $250,000,00 fine or both.
Assistant U.S. Attorney Melissa Marangola, who is handling the case, stated that Bland is accused of robbing three M&T Banks located at 1300 Jefferson Avenue in Buffalo, 750 Main Street in Niagara Falls, and 1877 Main Street in Buffalo, between August 21, 2013 and September 4, 2013. Tynes is accused of robbing the M&T Bank located at 1300 Jefferson Avenue in Buffalo on September 11, 2013. Bell-Bradley is accused of robbing the Key Bank located at 306 West Ferry Street in Buffalo on November 6, 2013. The three defendants used notes threatening the use of weapons in all of the bank robberies.
The indictments are the culmination of an investigation on the part of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Brian P. Boetig, the Buffalo Police Department, of under the direction of Commissioner Daniel Derenda, and the Niagara Falls Police Department, under the direction of Chief Bryan DalPorto.Therapist Pleads Guilty in Miami for His Role <br /> in $63 Million Health Care Fraud SchemeRead the Press Release
A former licensed mental health counselor at the defunct health provider Health Care Solutions Network Inc. (HCSN) pleaded guilty today in Fort Lauderdale, Fla., for his role in a $63 million health care fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement.
Ruben Busquets, 50, of Miami, pleaded guilty before U.S. District Judge William J. Zloch in the Southern District of Florida to one count of conspiracy to commit health care fraud. He faces a maximum penalty of 10 years in prison when he is sentenced on Feb. 20, 2014.
According to court records, Busquets was employed as a licensed therapist at HCSN, a mental health facility that purported to provide Partial Hospitalization Program (PHP) services. A PHP is a form of intensive treatment for severe mental illness. HCSN of Florida (HCSN-FL) operated community mental health centers at two locations. Court records indicate that Busquets was aware that HCSN-FL personnel were routinely fabricating patient medical records. Many of these medical records were created weeks or months after the patients were admitted to HCSN-FL for purported PHP treatment and were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Florida Medicaid. During his employment at HCSN-FL, Busquets and his co-conspirators signed fabricated PHP therapy notes and other medical records used to support false claims to government-sponsored health care programs.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorney Allan J. Medina of the Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .Therapist Pleads Guilty in Miami for His Role in $63 Million Health Care Fraud SchemeRead the Press Release
A former licensed mental health counselor at the defunct health provider Health Care Solutions Network Inc. (HCSN) pleaded guilty today in Fort Lauderdale, Fla., for his role in a $63 million health care fraud scheme.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement.
Ruben Busquets, 50, of Miami, pleaded guilty before U.S. District Judge William J. Zloch in the Southern District of Florida to one count of conspiracy to commit health care fraud. He faces a maximum penalty of 10 years in prison when he is sentenced on Feb. 20, 2014.
According to court records, Busquets was employed as a licensed therapist at HCSN, a mental health facility that purported to provide Partial Hospitalization Program (PHP) services. A PHP is a form of intensive treatment for severe mental illness. HCSN of Florida (HCSN-FL) operated community mental health centers at two locations. Court records indicate that Busquets was aware that HCSN-FL personnel were routinely fabricating patient medical records. Many of these medical records were created weeks or months after the patients were admitted to HCSN-FL for purported PHP treatment and were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Florida Medicaid. During his employment at HCSN-FL, Busquets and his co-conspirators signed fabricated PHP therapy notes and other medical records used to support false claims to government-sponsored health care programs.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorney Allan J. Medina of the Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,700 defendants who collectively have falsely billed the Medicare program for more than $5.5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
The Owners of Ohio Head Shops Among Five Indicted for Distribution of Synthetic Cannabinoids Sold as Spice or K2Read the Press Release
The owners of a chain of head shops were among five people indicted for conspiracy to distribute synthetic cannabinoids for their sale of products with names such as spice and K2, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Indicted are: Sean Lightner and Sherry Lightner, both 38 and both of Grafton; Dale Drummond, 39, of Cleveland; Mark Picard, 32, of Whittier, Calif. and Nathan Albright, 28, of Glendale, Arizona.
“These defendants sold a product that was designed to mimic an illegal drug,” Dettelbach said. “No matter what it was labeled or whatever clever name it was given, it was illegal.”
Synthetic cannabinoids are a large family of chemically unrelated structures functionally similar to THC. Synthetic cannabinoids may contain Schedule I controlled substances or controlled substance analogues and have purported physchotropic effects when smoked or ingested.
The Lightners operated a chain of head shops (retail stores specializing in drug and smoking paraphernalia) doing business as Twilight Boutique, where they sold synthetic cannabinoids along with accessories such as bongs, pipes and rolling papers, according to the indictment.
They franchised the Twilight Boutique on Madison Avenue in Lakewood to Dale Drummond for a percentage of the store’s monthly revenue. Drummond also sold synthetic cannabinoids from the store, according to the indictment.
The Lightners expanded their business to include several locations in Ohio after they began selling synthetic cannabinoids. They control Twilight Corp., located on Royalton Road in Grafton, and the Twilight Boutique stores located on State Route 43 in Streetsboro, Cleveland Road West in Sandusky, Pearl Road in Brunswick, North Abbe Road in Elyria, Lorain Road in Fairview Park, Whipple Avenue in Plain Township, North Court Street in Athens, Midway Plaza in Tallmadge, South Alex Road in West Carrollton, West Fourth Street in Ontario and Clinton Plaza Drive in Oneonta, N.Y., according to the indictment.
The Lightners presented laboratory reports to others, including employees, alleging that the synthetic cannabinoids sold in the Twilight Boutique stores did not contain controlled substances or controlled substance analogues in an effort to give the appearance that the synthetic cannabinoids were legal when the Lightners knew they were illegal, according to the indictment.
Albright sold synthetic cannabinoids through his company, Desert Distribution, LLC and Albright and Picard sold synthetic cannabinoids through their company, Royal Dutch, LLC.
Prosecutors are also seeking to forfeit more than $225,000 in cash seized, as well as three vehicles and property in Grafton, according to the indictment.
This case is being prosecuted by Assistant United States Attorney Teresa Dirksen following an investigation by the Drug Enforcement Administration Drug Enforcement Administration—Tactical Diversion Squad, Internal Revenue Service -- Criminal Investigations, Lorain County Drug Task Force, Medina County Drug Task Force, Portage County Drug Task Force, Westshore Enforcement Bureau, MEDWAY Drug Enforcement Agency, METRICH Enforcement Unit, Cuyahoga County Sheriff’s Office, Linndale Police Department, Lakewood Police Department, Cleveland Police Department, Ontario Police Department, Sandusky Police Department, Ohio HIDTA and the Ohio State Patrol.
If convicted, the defendants’ sentences will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge. The defendants are innocent until proven guilty beyond a reasonable doubt.
Tax Return Preparer Convicted of Fraud and Identity Theft In$19 Million SchemeRead the Press Release
ATLANTA – A federal jury today found Bernando O. Davis guilty of conspiracy, wire fraud, and aggravated identity theft for using stolen identities to file false federal income tax returns that claimed millions of dollars in bogus refunds.
“Almost every day we learn of another identity thief who has found a unique way to steal personal identifying information. The common theme is that the thieves always use the information they steal to commit a second theft: the theft of money,” said United States Attorney Sally Quillian Yates. “Today, a federal jury brought this defendant’s identity theft scheme to an end.”
“These unscrupulous defendants thought they had figured out a clever scheme to thwart the IRS and steal from American taxpayers,” said IRS Criminal Investigation, Special Agent in Charge, Veronica F. Hyman-Pillot. “Today’s verdict clearly demonstrates that taking advantage, manipulating, and stealing from the American people will not go unpunished.”
“This case is just another prime example that demonstrates the hard work and collaborative law enforcement effort to fight against perpetrators committing fraudulent acts against the American public. The U.S. Postal Inspection Service will continue to aggressively investigate all crimes where illegal use of the U.S. mail is used to further fraudulent schemes." said Keith Fixel, Postal Inspector in Charge, U.S. Postal Inspection Service - Charlotte Division.”
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, and Carla L. Jefferson of Palmdale, 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 co-conspirators used toll-free telephone numbers, web sites, flyers, and radio advertisements to advertise the “stimulus payments” and collect victims’ personal information. 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 payment existed, and Davis and his co-conspirators 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 he or his co-conspirators controlled. Davis and his co-conspirators shared in the profits generated from this scheme. The victims did not know that Davis had filed tax returns in their names.
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.
In June 2012, Davis, 27, of Stockbridge, Ga., entered into an “Assurance of Voluntary Compliance” with the Administrator of the Georgia Fair Business Practices Act, in which he agreed to modify his business practices. The evidence at trial demonstrated that despite entering into this agreement, he continued to file false tax returns using the identities of unsuspecting victims. Over 20 victims testified at trial. The scheme affected over 15,000 victims in virtually every state across the country.
The jury convicted Davis of one count of conspiracy, 15 counts of wire fraud, and 15 counts of aggravated identity theft. The wire fraud counts each carry a maximum sentence of 20 years in prison, the conspiracy count carries a maximum sentence of 5 years in prison, and the aggravated identity theft charges each carry a mandatory two-year sentence. At least one of the two-year sentences for aggravated identity theft must run consecutively to any other sentence imposed. Each count also carries a fine of up to $250,000. Davis was detained after the verdict.
On November 20, 2013, Jefferson pleaded guilty to conspiracy for her role in the scheme. On May 22, 2013, Sonnier, 44, of Ellenwood, Ga., pleaded guilty to conspiracy, wire fraud, and aggravated identity theft for his role. As part of his plea agreement, Sonnier agreed 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. In addition, Sonnier agreed to a money judgment of at least $7 million and full restitution to the IRS.
In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
Sentencing for Davis is scheduled for February 19, 2014, at 10:00 a.m. before United States District Judge Charles A. Pannell, Jr. Sentencing for Sonnier is scheduled for January 7, 2014, at 11 a.m., before Judge Pannell. Sentencing for Jefferson is scheduled for February 18, 2014, at 10 a.m., before Judge Pannell.
This case is being 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.
St. Petersburg Landlord Charged with EPA Violations and Falsifying RecordsRead the Press Release
Tampa, FL – Acting United States Attorney A. Lee Bentley, III announces the return of a six-count superseding indictment charging Michael Moshe Shimshoni (56, Tierra Verde) with four counts of failing to provide approved Environmental Protection Agency (“EPA”) lead paint warning notices and brochures to his tenants, and two counts of alteration or falsification of records in a federal investigation. If convicted, he faces a maximum penalty of one year in federal prison on each of the failures to provide warning notice counts, and twenty years’ imprisonment for each of the falsification of records counts.
According to the indictment, Shimshoni owned, managed, and offered commercial and residential properties for lease in St. Petersburg through Pinellas Properties, Inc., and Affordable Realty and Property Management, Inc., among other entities. The superseding indictment alleges that Shimshoni knowingly and willfully failed to provide the prescribed lead paint hazard warning notices and federally approved lead paint hazard brochures to lessees of his properties. Federal law and regulations require that landlords must provide a prospective tenant of certain “target housing” built prior to 1978, before a tenant is obligated under any lease, with various warning notices including a lead warning statement, and a statement by the tenant affirming the receipt of an EPA approved lead hazard information pamphlet. The purpose of the pamphlet is to alert tenants to the dangers of lead paint and inform them about measures to reduce the risk of lead-based hazards.
The superseding indictment further alleges that Shimshoni altered, falsified, and made false entries in documents and records with the intent to impede, obstruct, and influence the Environmental Protection Agency’s investigation and administration of the Lead Hazard Reduction Act, the Toxic Substance Control Act, and related provisions by producing backdated "Disclosure of Information on Lead-Based Paint and/or Lead-Based Paint Hazards" forms.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the EPA Criminal Investigations Division. It will be prosecuted by Assistant United States Attorney Matthew J. Mueller.
Click HERE to view Superseding Indictment
Smuggler Gets Enhanced SentenceRead the Press Release
McALLEN, Texas ‐ Jose Guadalupe Reyna-Esparza, 21, of Tampico, Tamaulipas, Mexico, has been ordered to federal prison for nine years as a result of his conviction of smuggling undocumented aliens, United States Attorney Kenneth Magidson announced today. Reyna-Esparza pleaded guilty Oct. 2, 2013.
Today, U.S. District Judge Micaela Alvarez sentenced Reyna-Esparza to a sentence of 108 months imprisonment. The sentence was enhanced as the court took into consideration the fact he had sexually assaulted a 14-year-old female undocumented alien on a number of occasions. As an illegal alien, Reyna-Esparza is expected to face deportation proceedings following his release from prison.
From July 16 to July 17, 2012, Reyna-Esparza harbored undocumented aliens at a residence located in McAllen. On July 17, 2012, law enforcement officers observed Reyna-Esparza and two other individuals leave the residence in a vehicle. When officers attempted to conduct a traffic stop, Reyna-Esparza who was driving, led them on a high speed chase before eventually stopping and absconding into a field. Through investigation, it was discovered that Reyna-Esparza had sexually assaulted the 14-year-old undocumented alien.
The investigation leading to the charges was conducted by Homeland Security Investigations, Border Patrol, San Juan Police Department and Alton Police Department.
Assistant United States Attorneys Kimberly Ann Leo and Kristen Rees prosecuted the case.
Six Guilty in Connection with Heroin TraffickingRead the Press Release
Department of Justice
Office of Public AffairsSHERMAN, Texas – Six North Texas men have pleaded guilty in connection with a heroin trafficking conspiracy in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Julio Cruz, 23, of Carrollton, Texas, pleaded guilty to conspiracy to distribute and possession with intent to distribute heroin on Dec. 10, 2013, before U.S. District Judge Marcia Crone.Co-defendants, Tyrese Jerrell Shelton, 27, of Carrollton; Cesar Alexander Avelar-Gomez, 20, of Dallas; Jose Eladio Molina, 27, of Carrollton; and Taylor Evan Anderson, 22, of Carrollton, each pleaded guilty to the same charges in the previous two months. Clayton Teasdale, 24, of Carrollton, pleaded guilty to using a communication device to facilitate a drug trafficking crime.
According to the Second Superseding Indictment, the distribution of heroin in this case was linked to heroin overdoses, including the death of a Carrollton resident.
A federal grand jury returned an indictment on Dec. 12, 2012, charging the defendants with federal drug trafficking violations.
"Members of the law enforcement community, to include the judicial system, are all too aware of the dangers and impact that illegal drug trafficking and use has on society,” said Chief Rex Redden of the Carrollton Police Department. “The results are always negative; so when we're able to work with our counterparts to bring individuals such as this to justice we know that we may be saving lives and lessening the harmful effects on our community. I want to congratulate everyone involved and thank those that came forward to assist and for their courage to do the right thing. We certainly feel for those that have lost loved ones and will continue to work hard to protect society from the harmful effects of illegal narcotics."
The Drug Enforcement Administration, along with our state and local partners, is committed to targeting and dismantling drug trafficking organizations determined to spread their filth throughout our communities said DEA’s Special Agent in Charge Daniel Salter. “Heroin abuse is unfortunately escalating --- forcing addiction, pain and devastation on its users. Today is a victory and I applaud the efforts of the special agents and officers who worked relentlessly to shut down this drug trafficking organization and to keep our neighborhoods free of the poison being spread by these criminals.”
The defendants each face a minimum of 10 years and up to Life in federal prison at sentencing. Sentencing dates have not been set.
This case is being investigated by the U.S. Drug Enforcement Administration, the Carrollton Police Department, the Coppell Police Department, the San Antonio Police Department, the Dallas County Sheriff’s Office, the Kaufman County Sheriff’s Office, and the Ellis County Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorney Heather Rattan.
Sentences for Decmber 10 - 12, 2013Read the Press Release
Raul Ramirez-Bravo, a/k/a Javier Bravo Refugio Servin, 44, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on December 12, 2013, for illegal re-entry of a previously deported alien into the United States. Ramirez-Bravo was arrested in Gillette, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Nicole Rae Presfield, 32, of Casper, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on December 11, 2013, for conspiracy to possess with intent to distribute, and to distributing 50 grams or more of methamphetamine. Presfield was arrested in Meeteetse, Wyoming. She received 132 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $400.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Raymond Lee Norcutt, 57, of Casper, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on December 10, 2013, for conspiracy to possess with intent to distribute, and to distributing 50 grams or more of methamphetamine. Norcutt was arrested in Meeteetse, Wyoming. He received 121 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $900.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Rochester Man Sentenced to Prison for Filing False Tax ReturnsRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Patrick Dandrea, 55, of Rochester, N.Y., who was convicted of filing false tax returns, was sentenced to 24 months in prison by U.S. District Court Judge Frank P. Geraci. The defendant was also ordered to pay $466,007.00 in restitution.
Assistant U.S. Attorney Craig R. Gestring, who handled the case, stated that the defendant was awarded a contract from Erie County in 2006 to remove damaged trees and branches following the October Storm. Dandrea received over $5,000,000 in payments which he failed to report on his 2006 and 2007 Federal Income Tax Returns. As a result, the Internal Revenue Service incurred a tax loss of over $460,000. In addition to being responsible for the tax loss, the defendant is also liable for interest payments and penalties of over $265,000 going back to 2006. Dandrea has previous federal convictions for mail fraud, wire fraud, money laundering, and conspiracy to distribute marijuana.
The sentencing is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service, Criminal Investigations Division, under the direction of Special Agent in Charge Toni Weirauch, and the Federal Bureau of Investigation, under the direction of Special Agent in Charge Brian P. Boetig.Rio Rancho Man Sentenced for Federal Bank Fraud and Money Laundering ConvictionRead the Press Release
ALBUQUERQUE – Derek Barnhill, 49, of Rio Rancho, N.M., was sentenced yesterday afternoon to three months in federal prison followed by three years of supervised release, which is to include nine months of home confinement, for his bank fraud and money laundering conviction. Barnhill also was ordered to pay $560,129.39 in restitution. The restitution is to be paid jointly with co-defendant Vincent J. Garcia.
In June 2010, Barnhill, Vincent Garcia, 61, an Albuquerque real estate developer, and David Garcia, 37, of Albuquerque, were charged in a 19-count superseding indictment with bank fraud and money laundering offenses in connection with three real estate development projects, including the Anasazi Downtown LLC (Anasazi Building).
Barnhill pled guilty in Dec. 2010, to Count 3, a bank fraud offense, and Count 10, a money laundering offense, and admitted collaborating with Vincent Garcia in a bank fraud and money laundering scheme. In Aug. 2011, Vincent Garcia entered a guilty plea to Count 3 of the superseding indictment, and admitted committing bank fraud in the amount of $365,677.00, and acknowledged that the gross loss amount to the victims of his fraudulent activity was $842,237.44. Neither Barnhill nor Vincent Garcia implicated David Garcia in the criminal conduct charged in the superseding indictment and the charges against him subsequently were dismissed.
According to court filings, Vincent Garcia executed a plan to obtain funding from the Columbian Bank & Trust Co. (Bank) by having Barnhill submit a construction loan drawn-down request containing a material misrepresentation to the Bank. The scheme began on Feb. 12, 2007, when Garcia told Barnhill that he needed $360,000.00 for a “good faith payment” towards the purchase of a casino. Garcia asked Barnhill to use an old bid for sheet rock for the Anasazi Building to get the money. Barnhill altered the sheet rock bid to support a fictitious draw-down request for $365,677.00, and submitted the request based solely on the false invoice to the Bank. After the Bank disbursed the money, Barnhill transferred the funds to an Anasazi account at New Mexico Bank and Trust. The next day, Garcia and Barnhill went to New Mexico Bank and Trust and withdrew $360,000.00 of the proceeds and deposited the money at Compass Bank into an account in the name of Albuquerque Downtown Partners. Thereafter, Garcia flew to Washington State with a Compass Bank check for $360,000.00 to make a payment on the casino.
Vincent Garcia was sentenced in April 2013, to 27-months in federal prison followed by five years of supervised release. He also was ordered to pay $722,543.76 in restitution. Garcia is serving his prison sentence.
This case was investigated by IRS Criminal Investigation, the FDIC-OIG and the Albuquerque office of the FBI, and was prosecuted by Assistant U.S. Attorney Jonathon M. Gerson.
Rio Grande City Nurse Practitioner on Her Way to Federal Prison in Marijuana CaseRead the Press Release
McALLEN, Texas – Celia Raquel Zuniga, 45, of Rio Grande City, has been ordered to prison following her conviction of conspiracy to possess with intent to distribute and possession with intent to distribute marijuana, announced United States Attorney Kenneth Magidson. The McAllen federal jury convicted Zuniga following a two-day trial and approximately two hours of deliberations on Wednesday, Sept. 25, 2013.
U.S. District Judge Micaela Alvarez, who presided over the trial, handed Zuniga a total sentence of 78 months in prison to be immediately followed by four years of supervised release. At the hearing today, the court enhanced her sentence, finding she obstructed justice when she perjured herself while testifying at trial. She was further ordered to pay a $5,000 fine as to each count. In handing down the sentence, Judge Alvarez noted while Zuniga performed a great service to the community as a nurse practitioner, she was causing great harm to the community because of this type of criminal activity.
During trial, Starr County sheriff’s deputies testified that on Dec. 6, 2012, they observed three vehicles driving in tandem going east on Expressway 83 near the Starr County and Hidalgo County line. They then observed the middle vehicle change lanes without signaling. Deputies conducted a traffic stop and identified Zuniga as the driver. At that time, deputies noticed a strong odor of marijuana emitting from the vehicle and a canine subsequently alerted to the presence of narcotics.
Initially, Zuniga lied to deputies and denied there was anything illegal in her vehicle. However, after stepping out of her vehicle and when asked a second time, Zuniga admitted there was something illegal inside. Deputies then recovered 24 bundles of marijuana, weighing approximately 243 kilograms within the car.
In her defense, Zuniga testified she had been kidnaped by multiple men while she was driving to a friend’s house. She claimed they took her to a cemetery while bundles of marijuana were loaded into her vehicle. She further testified they told her she would need to drive the vehicle to McAllen or else something would happen to her family.
The jury was not convinced of Zuniga’s claim of duress and ultimately found her guilty as charged.
Previously released on bond, Zuniga was taken into custody following the return of the verdict where she will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The case was investigated by Homeland Security Investigations with the assistance of the Starr County Sheriff’s Office. Assistant United States Attorney Kimberly Ann Leo is prosecuting.
Perry County Man Pleads Guilty to Methamphetamine ConspiracyRead the Press Release
A Perry County, IL, man pled guilty in federal district court to an indictment charging conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
On December 11, 2013, Ty W. Dusch, 50, of DuQuoin pled guilty to the one-count indictment charging conspiracy to manufacture methamphetamine. The offense occurred between 2011 and June 2013 in Jackson and Perry Counties. Evidence at the plea hearing established that Dusch and others were obtaining pseudoephedrine for the purpose of manufacturing methamphetamine. When officers executed a search warrant at a Murphysboro residence where Dusch was staying, they located methamphetamine and methamphetamine-making materials. Dusch faces a term of imprisonment of up to 20 years, to be followed by 3 years’ supervised release, and a $1,000,000 fine. Dusch is currently being held without bond pending an April 4, 2014, sentencing hearing.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, and Drug Enforcement Administration. The DuQuoin Police Department also assisted in the investigation.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Pennsylvania Man Sentenced to 18 Months in Prison <br /> for Hacking into Multiple Computer NetworksRead the Press Release
A Pennsylvania man was sentenced to serve 18 months in prison for his role in a scheme to hack into computer networks and sell access to those networks.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U .S. Attorney Carmen M. Ortiz of the District of Massachusetts made the announcement after sentencing by U.S. District Judge Mark Wolf in the District of Massachusetts on Dec. 11, 2013.
Andrew James Miller, 23, of Devon, Pa., pleaded guilty to conspiracy and computer fraud on Aug. 26, 2013. According to court documents, from 2008 to 2011, Miller remotely hacked into a variety of computers located in Massachusetts and elsewhere, and, in some instances, surreptitiously installed “backdoors” into those computers. These “backdoors” were designed to provide future administrator-level, or “root,” access to the compromised computers.
Miller obtained login credentials to the compromised computers. He and his co-conspirators then sold access to these backdoors, as well as other login credentials. The access sold by Miller and his co-conspirators allowed unauthorized people to access various commercial, education and government computer networks. Miller attempted to sell access for $50,000 to two supercomputers at the Lawrence Berkeley Laboratory in California that were part of the National Energy Research Scientific Computing Center.
The case was investigated by the FBI and prosecuted by Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam Bookbinder of the U.S. Attorney’s Office for the District of Massachusetts.New Arrest: Carmine Mandarano MD- Complaint for Distribution of Controlled SubstanceRead the Press Release
New Arrest: Carmine Mandarano MD- Complaint for Distribution of Controlled Substance
Mission Hills Woman Indicted for Cayman Island Tax Scheme, Lying to Federal AuthoritiesRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Mission Hills, Kan., woman was indicted by a federal grand jury today for using numerous foreign trusts and secret Cayman Island bank accounts as part of a scheme to avoid paying more than $7 million in income taxes, and for lying to federal authorities concerning her Cayman Island interests.
“Offshore tax evasion is an issue of fundamental fairness,” Dickinson said. “Americans who unlawfully hide their money offshore aren’t paying the taxes they owe, while citizens who play by the rules are forced to pick up the slack and foot the bill.
“Americans with secret offshore bank accounts still have an opportunity to voluntarily disclose those accounts to the Internal Revenue Service to avoid going to jail,” Dickinson added. “I encourage those taxpayers to do the right thing and take advantage of the IRS’s offshore voluntary disclosure program. Taxpayers can voluntarily come back into compliance so they properly report and pay their taxes.”
Verna Cheryl Womack, 62, of Mission Hills, was charged in a 10-count indictment returned by a federal grand jury in Kansas City, Mo. In addition to her Mission Hills residence, Womack maintains a condominium in the Cayman Islands and a condominium at Trump Towers in New York, N.Y. (Although the Cayman Islands and New York residences are owned by companies that Womack organized under trusts that were created in the Cayman Islands, according to today’s indictment, they are in her custody and control and for her use and enjoyment.)
Womack owned and operated a number of businesses associated with selling liability insurance policies to independent truck drivers. She sold those businesses for more than $35 million in April 2002.
Today’s indictment alleges that Womack opened at least 19 bank accounts and organized a series of nominee companies and trusts in the Cayman Islands to conceal a portion of her income from the IRS. According to the indictment, these corrupt endeavors were part of a scheme that began in 1996 and caused a total tax loss to the government in excess of $7 million.
As part of her corrupt endeavors, the indictment says, Womack repeatedly failed, year after year, to report her financial interests in her nominee companies and trusts to the IRS despite the multiple legal requirements that, as a United States citizen, she do so. Today’s indictment alleges that Womack filed federal tax returns that stated she did not have an interest in or signature authority over any foreign financial accounts, even though Womack knew that was false and fraudulent. For example, the indictment says, Womack maintained a Cayman Island bank account in her own name for several years, with balances ranging from nearly $41,000 to more than $173,000. The indictment alleges that Womack repeatedly failed, year after year, to report her financial interests in her bank account to the IRS.
Womack is charged with one count of attempting to interfere with the administration of internal revenue laws and nine counts of making a false statement to a government agency.
Wine Collection & Auction
Among its allegations, the indictment cites one of Womack’s nominee companies in the Cayman Islands as an example of Womack’s corrupt endeavors to conceal income from the IRS. Womack exercised ownership, custody and control over Lucy Limited and its assets. Among its assets, the indictment says, Lucy Limited owned (as nominee for Womack) a wine collection that was stored in the basement of Womack’s Mission Hills residence. Womack used a credit card issued by the Bank of Butterfield (in Grand Cayman) in the name of Lucy Limited to purchase at least part of the wine for her collection, for which she paid approximately $1.5 million over the course of several years.
On March 15, 2008, Womack sold approximately half of the wine stored in her basement at an auction house in New York for $1.6 million. The indictment alleges that she attempted to use her nominee company, Lucy Limited, and its financial accounts at the Bank of Butterfield in Grand Cayman to conceal the revenues and profits she derived from the sale of the wine.
Following the sale, the indictment says, Womack personally directed the auction house to wire more than $1.6 million in a series of transfers to a Lucy Limited account at the Bank of Butterfield that Womack controlled. Womack allegedly employed a number of false and fraudulent business agreements that appeared to be arm’s length transactions, but were in fact Womack’s self-dealing, resulting in wires of those proceeds back to the United States for Womack’s personal use.
For example, the indictment alleges that a $298,957 wire transfer was falsely and fraudulently represented in Lucy Limited’s financial statements as a management fee due to Womack. Womack also allegedly created a false and fraudulent document purporting to be a lease agreement between herself and Lucy Limited. Although not created until October 2008, the indictment says, the false and fraudulent lease agreement stated that Lucy Limited would lease the wine cellars in the basement of Womack’s Mission Hills residence for $25,000 per year beginning in 1995 and continuing through at least 2009. The day after creating that fraudulent document, Womack caused a $350,000 wire transfer from the wine auction proceeds to be wired to a bank account under her control in Kansas City, Mo. According to the indictment, Womack falsely and fraudulently represented in Lucy Limited’s financial statements that this wire transfer was payment for rent due under the lease agreement for the years 1995 through 2008.
After the auction, Womack caused the wine that was provided to the auction house but did not sell during the auction to be transported and stored at her condominium at Trump Towers in New York.
As a result of her efforts to disguise the self-dealing nature of these transactions, the indictment says, Womack did not report the income she derived from the sale of the wine on her federal tax return. She did not disclose her control of Lucy Limited or the existence of its bank account to the IRS, the indictment says, and she did not properly report the profit she derived from that sale – at least $851,188 – on her tax return.
On May 19, 2009, Womack testified under oath in a deposition by a trial attorney for the U.S. Department of Justice, Tax Division, regarding a lawsuit that sought to enjoin a third party from providing tax advice. According to the indictment, Womack falsely and fraudulently stated that Lucy Limited’s investors paid her to purchase the wine, manage the wine, and properly contain the wine, when she knew that there were no such investors, that she organized Lucy Limited, and that she exercised ownership, custody and control over Lucy Limited and its assets.
False Statements
Today’s indictment also alleges that Womack repeatedly lied to federal government officials and agents about her interests in Cayman Island businesses, trusts and bank accounts. On one occasion, Womack allegedly lied to two FBI agents, falsely claiming that she did not own any foreign businesses and that those businesses were owned by other investors, when she knew that no other investors existed. Womack provided a list of her financial accounts to an FBI agent in relation to a separate federal criminal investigation. Womack’s list of her accounts did not include any of her foreign bank accounts.
During the May 19, 2009, deposition, Womack allegedly repeatedly lied under oath about her financial interests in the Cayman Islands. During that deposition, the indictment says, Womack knowingly made numerous false and fraudulent statements regarding her Cayman Island trusts and business interests. Today’s indictment charges Womack with nine counts of making material false statements during that deposition.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorneys Brian P. Casey and Daniel M. Nelson. It was investigated by IRS-Criminal Investigation and the FBI.
IRS Offshore Voluntary Disclosure Program
Federal tax law requires U.S. taxpayers to pay taxes on all income earned worldwide. U.S. taxpayers must also report foreign financial accounts if the total value of the accounts exceeds $10,000 at any time during the calendar year. Willful failure to report a foreign account can result in a fine of up to 50 percent of the amount in the account at the time of the violation.
Since 2006, American law enforcement agencies have had some, but limited, ability to obtain financial records concerning foreign accounts of American citizens in so-called tax havens. But a new Foreign Account Tax Compliance Act (FATCA) became law in the United States in March 2010 and is taking effect abroad on a country-by-country basis. The IRS and law enforcement are now more readily able to obtain the records of Americans holding foreign bank accounts in countries including Switzerland, the Cayman Islands and Costa Rica. FATCA requires foreign financial institutions to report the holdings of U.S. taxpayers to the IRS, or else face serious penalties.
The IRS Offshore Voluntary Disclosure Program enables U.S. taxpayers to resolve their tax liabilities and minimize their chances of criminal prosecution by voluntarily disclosing previously undisclosed foreign accounts and income. Approximately 38,000 voluntary disclosures from individuals have been made under the Offshore Voluntary Disclosure Initiative.
“How to make an offshore voluntary disclosure”: http://www.irs.gov/uac/How-to-Make-an-Offshore-Voluntary-Disclosure
Medical Drug Clinic Owner Sentenced to 60 Months in Prison for Drug Distribution and Money LaunderingRead the Press Release
LAFAYETTE, La. –United States Attorney Stephanie A. Finley announced today that Gloria Adams, 63, of LaPlace, La., was sentenced by U.S. District Judge Elizabeth E. Foote to 60 months in prison with three years of supervised release for her part in a conspiracy to fill prescriptions without doctors being present. She also was ordered to forfeit $241,793. Adams pleaded guilty on April 23, 2013.
According to evidence presented at the guilty plea, Adams, who is not a doctor, opened Essential Medical Center (EMC) in November 2005 in Lafayette. She admitted to conspiring to dispense Controlled Dangerous Substances (CDS) such as Xanax and Lortab when no doctors were present at the clinic through a system called “pre-signing.” Pre-signing took place at the clinic when some non-physician staff used pre-signed documents to dispense prescriptions to patients while doctors were absent. She also admitted that she aided and abetted the practice of dispensing CDS outside the scope of professional practice and not for a legitimate medical purpose. Adams also admitted to laundering approximately $16,000 in drug proceeds through a financial institution.
“I would like to thank the Drug Enforcement Administration and the Internal Revenue Service for combining forces to successfully investigate this case,” Finley stated. “Combating the illegal distribution of prescription drugs remains a priority in my office.”
“IRS - CI will continue to play an active part in the war on drugs,” stated IRS Special Agent in Charge Gabriel L. Grchan. “Individuals such as Gloria Adams that are guilty of attempting to launder their illegal drug profits will be prosecuted for money laundering violations; IRS - CI will continue to work with our federal partners to that end.”
The Drug Enforcement Administration – Office of Diversion Control and the Internal Revenue Service conducted the investigation. Assistant U.S. Attorney Daniel J. McCoy prosecuted the case.Manhattan U.S. Attorney Files and Settles Civil Rights Lawsuit Against Westchester County Landlord for Discrimination Against African-AmericansRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that the United States has filed and settled a federal civil rights lawsuit under the Fair Housing Act against 61 MAIN STREET CORPORATION and ROSARIO MACRI for discriminating against African-Americans seeking to rent apartments at an apartment complex located at 123 South Broadway in Irvington, New York. The settlement, in the form of a consent decree, was approved today by U.S. District Judge Kenneth M. Karas.
Manhattan U.S. Attorney Preet Bharara said: “Nobody should be deprived of housing opportunities based on his or her race or color. This case should be a wake-up call to any landlord or building owner who discriminates. Racial discrimination in housing is not only antithetical to the principles of fairness and equality, it is against the law.”
The apartment complex at 123 South Broadway is a 22-unit residential apartment complex located in the Village of Irvington, in Westchester County, New York. The apartment complex is owned by 61 MAIN STREET CORPORATION. ROSARIO MACRI is the president of 61 MAIN STREET CORPORATION and manages the apartment complex. According to the Complaint filed in federal court in Manhattan, since at least August 2012, 61 MAIN STREET CORPORATION and ROSARIO MACRI have engaged in conduct constituting discrimination on the basis of race and color under the Fair Housing Act.
Specifically, the United States alleges that 61 MAIN STREET CORPORATION and ROSARIO MACRI have engaged in racially discriminatory housing practices, including failing to inform African-American prospective tenants about available apartments, while telling Caucasian prospective tenants, even on the same day, that apartments were in fact available. The Complaint also alleges that 61 MAIN STREET CORPORATION and ROSARIO MACRI failed to show available apartments and give rental applications to African-American prospective tenants, but showed available apartments and gave rental applications to Caucasian prospective tenants, even on the same day. In addition, the Complaint alleges that 61 MAIN STREET CORPORATION and ROSARIO MACRI provided higher rent prices and less favorable security deposit terms to African-American prospective tenants than those offered to similarly situated Caucasian prospective tenants.
The Consent Decree requires 61 MAIN STREET CORPORATION and ROSARIO MACRI, among other things, to refrain from discriminating on the basis of race in their rental practices, and to implement a non-discrimination policy and non-discriminatory standards and procedures, as set forth in the Consent Decree, at the apartment complex at 123 South Broadway. In addition, 61 MAIN STREET CORPORATION and ROSARIO MACRI will pay $60,000 into a fund for the compensation of victims of their discriminatory conduct, as well as a $32,000 civil penalty to the United States.
The case is being handled by the Office’s Civil Rights Unit. Assistant United States Attorney Rebecca S. Tinio is in charge of the case.
U.S. v. 61 Main Street Corporation and Rosario Marci Consent Decree
Manhattan U.S. Attorney Announces Arrest of Indian Consular Officer for Visa Fraud and False Statements in Connection with Household Employee’s Visa ApplicationRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, today announced the arrest of DEVYANI KHOBRAGADE on charges that KHOBRAGADE allegedly caused a materially false and fraudulent document to be presented, and materially false and fraudulent statements to be made, to the United States Department of State in support of a visa application for an Indian national employed as a babysitter and housekeeper at KHOBRAGADE’s home in New York, New York. KHOBRAGADE is currently employed as the Deputy Consul General for Political, Economic, Commercial and Women’s Affairs at the Consulate General of India in New York, New York.
Manhattan U.S. Attorney Preet Bharara said: “Foreign nationals brought to the United States to serve as domestic workers are entitled to the same protections against exploitation as those afforded to United States citizens. The false statements and fraud alleged to have occurred here were designed to circumvent those protections so that a visa would issue for a domestic worker who was promised far less than a fair wage. This type of fraud on the United States and exploitation of an individual will not be tolerated.”
According to the allegations in the criminal complaint unsealed today in Manhattan federal court:
Diplomats and consular officers may obtain A-3 visas for their personal employees, domestic workers, and servants if they meet the requirements set out in 9 Foreign Affairs Manual (“FAM”) 41.22. As part of the application process, an interview at the embassy or consulate is required. Proof is required that the applicant will receive a fair wage, sufficient to support himself financially, comparable to that being offered in the area of employment in the U.S. To apply for an A-3 visa, the visa applicant must submit an employment contract signed by both the employer and the employee which must include, among other things, a description of duties, hours of work, the hourly wage – which must be the greater of the minimum wage under U.S. federal and state law, or the prevailing wage – for all working hours, overtime work, and payment.
DEVYANI KHOBRAGADE prepared and electronically submitted an application for an A-3 visa (the “Visa Application”) through the website for the U.S. Department of State’s Consular Electronic Application Center for an Indian national (“Witness-1”), who was to be the personal employee of KHOBRAGADE beginning in November 2012 at an address in New York, New York. The Visa Application stated that Witness-1 was to be paid $4,500 per month in U.S. dollars. KHOBRAGADE and Witness-1 also signed an employment contract (the “First Employment Contract”) for Witness-1 to bring to Witness-1’s interview at the U.S. Embassy in India in connection with the Visa Application, which Witness-1 did at KHOBRAGADE’s direction. The First Employment Contract stated, among other things, that KHOBRAGADE would pay Witness-1 the prevailing or minimum wage, whichever is greater, resulting in an hourly salary of $9.75.
KHOBRAGADE knew that the First Employment Contract that KHOBRAGADE caused Witness-1 to submit to the U.S. State Department in connection with Witness-1’s Visa Application contained materially false and fraudulent statements about, among other things, Witness-1’s hourly wage and hours worked. Prior to the signing of the First Employment Contract, KHOBRAGADE and Witness-1 had agreed that KHOBRAGADE would pay 30,000 rupees per month, which at the time was equivalent to $573.07 U.S. At 40 hours per week, with approximately 4.3 weeks in a month, $573.07 equates to a rate of $3.31 per hour. However, KHOBRAGADE instructed Witness-1 to say that she would be paid $9.75 per hour, and not to say anything about being paid 30,000 rupees per month. KHOBRAGADE also instructed Witness-1 to say that Witness-1 would work 40 hours per week, and that Witness-1’s duty hours would be 7 a.m. to 12:30 p.m., and 6:30 p.m. to 8:30 p.m. She told Witness-1 that the First Employment Contract was a formality to get the visa.
After the First Employment Contract was submitted to the United States Department of State, KHOBRAGADE told Witness-1 that Witness-1 needed to sign another employment contract (the “Second Employment Contract”). KHOBRAGADE and Witness-1 signed the Second Employment Contract, which provided that Witness-1’s maximum salary per month including overtime allowance will not exceed 30,000 rupees per month. The Second Employment Contract does not contain any provision about the normal number of working hours per week or month.
Witness-1 worked for KHOBRAGADE as a household employee in New York, New York, from approximately November 2012 through approximately June 2013. Notwithstanding the terms of the First Employment Contract, Witness-1 worked far more than 40 hours per week, and Witness-1 was paid less than $9.75 per hour by KHOBRAGADE. In fact, notwithstanding the terms of the oral agreement between KHOBRAGADE and Witness-1 and the terms of the Second Employment Contract, Witness-1 was paid less than 30,000 rupees per month, or $3.31 per hour.
KHOBRAGADE, 39, was charged with one count of visa fraud and one count of making false statements, which carry maximum sentences of ten years and five years in prison, respectively. She is expected to appear this afternoon before U.S. Magistrate Judge Debra Freeman.
Manhattan U.S. Attorney Bharara thanked the Department of Justice’s Human Trafficking Prosecution Unit for playing an integral role in this investigation, and for providing ongoing support in this prosecution.
The Office’s Organized Crime Unit is handling the case. Assistant U.S. Attorneys Amanda Kramer and Kristy Greenberg are in charge of the prosecution.
The charges contained in the complaint are merely an accusation, and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Devyani Khobragade Complaint
Man Sentenced in Wichita Mortgage Fraud CaseRead the Press Release
WICHITA, KAN. - Another man has been sentenced in a mortgage fraud case in Wichita, U.S. Attorney Barry Grissom said today.
Steven Pelz, 40, Wichita, Kan., was sentenced Monday to two years federal probation. Pelz pleaded guilty to one count of wire fraud. In his plea, he admitted he was part of a scheme devised by co-defendant Manjur Alam to fraudulently obtain mortgage loans by falsifying loan applications and supporting documents.
On Aug. 22, 2007, Pelz caused First Home Loans to send a wire payment of $50,246 to Kansas Secured Title for the purchase of a property at 1044 S. Sedgwick in Wichita. On the loan application, Pelz and Alam made false statements including falsely representing Pelz’s income and falsely stating that Pelz planned to occupy the property.
Co-defendants are:
Manjur Alam, 46, Wichita,who pleaded guilty to one count of conspiracy to commit wire fraud and bank fraud, is set for sentencing Jan. 27.
Christopher Ginyard, 27, Wichita, who was sentenced to two years supervised release and $40,000.
Henry Pearson, Jr., 29, Wichita, who was sentenced to two years supervised release and $56,000 restitution.
Henry Pearson, Sr., Wichita, who was sentenced to two years supervised release and $55,180 restitution.
Bruce Dykes, 45, Wichita, who was sentenced to two years supervised release and $14,872 restitution.
Janice Young, 27, Wichita, who is awaiting sentencing.Grissom commended the Department of Housing and Urban Development, the Federal Housing Finance Agency - OIG, the Internal Revenue Service and Assistant U.S. Attorney Aaron Smith for their work on the case.
Loxahatchee Pair Plead Guilty to Government Benefit Fraud ChargesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Lester Fernandez, Special Agent in Charge, U.S. Department of Housing and Urban Development (HUD), Office of Inspector General, Ric L. Bradshaw, Sheriff, Palm Beach County Sheriff’s Office, Thomas Caul, Special Agent in Charge, Social Security Administration (SSA), Office of Inspector General, Atlanta Field Division, Karen Citizen-Wilcox, Special Agent in Charge, U.S. Department of Agriculture (USDA), Office of Inspector General, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Miami Region, announce that defendants Gloria Nereida Valle-Clas, 48, and Alexander Gonzalez, 40, of Loxahatchee, Florida, pled guilty today in West Palm Beach before U.S. Magistrate Judge James M. Hopkins.
According to the indictment, and as the defendants admitted when pleading guilty, Valle-Clas obtained two social security numbers (SSN), one of which was originally associated with her birth name, “Nereida Valle,” and one of which was originally associated with the name “Gloria Lopes Clas.” From at least December 2003 to January 2013, she used the SSN for “Nereida Valle” to obtain federal housing, social security, food, cash, and medical benefits from HUD, SSA, USDA and HHS. At the same time, she used the SSN for “Gloria Lopes Clas” to buy real estate in both Broward and Palm Beach Counties, including over an acre of property in Loxahatchee, Florida on which she built an approximately 2,700 square foot residence. Her husband, Gonzalez, also bought real estate in Broward County. When applying for federal benefits, she failed to disclose her or her husband’s ownership of property, as well as other assets and income.
Valle-Clas, who formally changed her name from “Nereida Valle” to “Gloria Nereida Valle-Clas” in 2003, used approximately 12 aliases in perpetrating the scheme, most of which were variations on “Nereida Valle” and “Gloria Lopes Clas.”
Valle-Clas pled guilty to one count of conspiracy, in violation of Title 18, United States Code, Section 371, and one count of making a false statement to HUD, in violation of Title 18, United States Code, Section 1001. Gonzalez pled guilty to one count of aiding and abetting Valle-Clas in making a false statement to HUD, in violation of Title 18, United States Code, Section 1001. The maximum penalties for each of the Section 371 conspiracy and Section 1001 HUD false statement counts are five years in prison, up to three years supervised release, and a fine of $250,000 or not more than twice the gross gain or loss form the offense, whichever is greater.
Valle-Clas and Gonzalez are scheduled to be sentenced on February 21, 2014 at 1:30 p.m. in West Palm Beach before U.S. Senior District Judge Kenneth L. Ryskamp.
Mr. Ferrer commended the investigative efforts of HUD-Office of the Inspector General, the Palm Beach County Sheriff’s Office, the SSA-Office of the Inspector General, the USDA-Office of the Inspector General, and the HHS-OIG. This case is being handled by Assistant U.S. Attorney Carolyn Bell.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Longtime Tampa Fraudster Sentenced to More Than 9 Years in Federal PrisonRead the Press Release
Tampa, Florida - Judge Elizabeth A. Kovechevich today sentenced Marterrance Q. Holloway (33, Tampa) to 9 years and 8 months in federal prison for conspiracy to defraud the United States Treasury through committing tax fraud and aggravated identity theft. As part of his sentence, the court entered a forfeiture money judgment in the amount of $238,573.30. Other items purchased with proceeds of the fraud and other substitute assets were also ordered to be forfeited, including two 2010 Chevrolet Camaros, a 2011 Dodge Charger, a 2005 Dodge Charger, a motor scooter, an iPad computer, assorted jewelry and $779 in cash.
Holloway pleaded guilty on July 24, 2013.
On September 23, 2013, Holloway’s co-defendant, Maurice Larry, a/k/a/ “Thirst,” was previously sentenced to 8 years and 5 months in prison for his involvement in this case. The following day, Larry was also sentenced to a concurrent prison term of 14 years, 6 months’ imprisonment in an unrelated tax fraud case with co-defendant, Rashia Wilson.
According to court documents filed in this case, Holloway and Larry were filing fraudulent tax returns from a Tampa hotel room, in September 2010. Inside the hotel room were four computers, which were used to electronically file fraudulent tax returns in the names of deceased individuals, along with website pages, ledgers, and lists of stolen names, dates of birth and social security numbers. Multiple "Turbo Tax" reloadable debit cards were also found in the hotel room, along with ATM receipts for cash withdrawals and approximately $3700 in cash. Larry and his co-defendant admitted to filing fraudulent tax returns on the computers while staying at the hotel.
Further, in August 2011, Holloway used a fraudulent debit card at a local bank ATM machine that had been loaded with the proceeds of a fraudulently filed tax return in the amount of over $9800.
“These individuals have demonstrated a blatant disregard of the integrity of the United States tax system and caused immeasurable hardship to innocent victims and deserve to be punished to the fullest extent of the law,” said James Robnett, Special Agent in Charge, IRS Criminal Investigation-Tampa Field Office. “IRS Criminal Investigation remains committed to the pursuit of stolen identity refund fraud and, together with our partners at the U.S. Attorney’s Office and the Tampa Bay Identity Theft Alliance, we will hold those who commit the same crimes similarly accountable.”
This case was investigated by the Internal Revenue Service – Criminal Investigation, the United States Secret Service and the Tampa Police Department. It is being prosecuted by Assistant United States Attorney Kelley Howard-Allen.
Leader of Poughkeepsie Heroin Ring That Operated Out of A Cellphone Store Sentenced to 15 Years in Prison in White Plains Federal CourtRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that SHABARI FISHER was sentenced in White Plains federal court to 15 years in prison for his leadership role in a drug conspiracy that distributed heroin across the City of Poughkeepsie, including out of a cellphone store on Main Street. FISHER pled guilty in October 2013 to one count of conspiracy to distribute heroin. He is one of 11 individuals charged by an Indictment in September 2012, six of whom have pleaded guilty. FISHER is the second defendant to be sentenced in the case by U.S. District Judge Kenneth M. Karas. On December 6, 2013, Shateek Parker, the second-in-command of the heroin conspiracy, was sentenced by Judge Karas to 135 months in prison.
U.S. Attorney Preet Bharara said: “Shabari Fisher and his accomplices should have stuck with cellphones because they made a huge mistake when they decided to enter the grim business of selling heroin. They now know there is no safe front for peddling heroin and destroying lives, families, and communities. Today’s sentence is a clear signal: If you see in our Hudson Valley an opportunity to profit from drugs, then you are leading yourself and your followers to long terms behind bars.”
According to the Indictment and information presented for purposes of Fisher’s guilty plea and sentencing:
From at least January 2011 through September 2012, a drug trafficking organization (the “FISHER Organization” or the “organization”) was operating in Poughkeepsie, New York. The FISHER Organization distributed heroin at several locations in and around Poughkeepsie. The locus of the organization’s heroin distribution was a cellphone store on Main Street in Poughkeepsie. At the cellphone store, members of the conspiracy concealed heroin, sold heroin to customers, and met with heroin customers to direct them to other locations for heroin transactions. On September 27, 2013, during execution of a search warrant, FBI agents recovered a .44 caliber handgun and ammunition concealed in the front of the store.
The FISHER Organization distributed heroin using, among other things, a succession of cellphones that individuals seeking heroin regularly called (the “Dispatch Phones”). Different members of the FISHER Organization held the Dispatch Phones at different times, receiving calls from heroin customers and arranging to meet with the customers at locations in Poughkeepsie to conduct heroin transactions. The bags of heroin distributed by the Fisher Organization were often stamped with brand-like names, such as “True Religion,” “Gucci,” “Rated R,” “Red Bull,” “Coors Light,” “Scarface,” and “Bomb.”
FISHER and Parker, the defendants, were leaders of the FISHER Organization who directed the activity of other members. FISHER and Parker participated in, among other things, obtaining supplies of heroin, providing heroin to other members of the FISHER Organization for further distribution, and steering heroin customers who approached FISHER to other members of the organization to conduct heroin transactions.
In addition to his prison term, FISHER, 34, of Poughkeepsie, New York, was also sentenced to five years of supervised release, and was ordered to pay forfeiture of $100,000.
Mr. Bharara praised the outstanding work of the FBI, the Poughkeepsie Police Department, the Dutchess County Sheriff's Office, the Drug Enforcement Administration, Immigration and Customs Enforcement, the United States Marshal’s Service Fugitive Unit, the New York State Police – CNET, the Orange County Sheriff’s Office, the Newburgh Police Department, the Middletown Police Department, the Beacon Police Department, the Dutchess County Probation Office, the Dutchess County Jail, and the New York Department of Correctional Services.
The charges against the remaining defendants contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Benjamin Allee and Michael Gerber are in charge of the prosecution.
Large-Scale Cocaine Trafficking Organization DismantledRead the Press Release
KNOXVILLE, Tenn. - A federal grand jury in Knoxville returned a 58-count indictment on Dec. 3, 2013, against Jesus Hernandez, a.k.a. “Chucho,” 31; Juan Julian Felipe, 26; Alfredo Casteneda, a.k.a. “Boludo,” 20; Faustino Ramirez Ponciano, a.k.a. “El Toño,” 18; Fernando Amayo Gonzalez, a.k.a. “Zeta,” 26; Gonzalo Garcia Gines, a.k.a. “Puebla,” 31; Felipe De Jesus Banales, a.k.a. “Guero,” 29; Elder Vasquez, 34; Johnny Soto-Quintana, a.k.a. “Ponzoña,” a.k.a. “Ponzi,” 23; Nahun Oliva, a.k.a. “El Perro,” 24, Gilberto Fuentes Dominguez, 27, Jesus Amustio Panoja, a.k.a. “Chuy,” 21; Anael Anariba, a.k.a. “Guero,” 35; Geyser Deleon, a.k.a. “Chiquilin,” a.k.a. “Chaparo,” 26; Jose Luis Aguilar, a.k.a. “Diego,” 34; Gelber Deleon, a.k.a. “Tarzan,” a.k.a. “Burro,” 21; Justin Moore, 28; Malcolm Jones, 21; David Lamb, 23; Monty Cooper, 42; and James Handly, a.k.a. “Flaco,” 54; all of whom were residing in Knoxville, Tenn., at the time of their arrests, charging them with conspiracy to distribute cocaine and cocaine base, money laundering, and gun charges.
These individuals appeared in court before U.S. Magistrate Judges this week and entered pleas of not guilty to the charges in the indictment. All of them have been ordered held without bond pending trial, which has been set for Feb. 11, 2013 in U.S. District Court, in Knoxville.
The first count of the indictment alleges that the members of the conspiracy are responsible for distributing in excess of five kilograms of cocaine and more than 280 grams of crack cocaine. If convicted, each faces a mandatory minimum prison term of at least 10 years and up to life and a fine of up to $10,000,000. The indictment alleges that the value of the drugs trafficked by all defendants was at least $17,500,000. One individual, Geyser Deleon, is charged with possessing a firearm in furtherance of a drug trafficking crime, and if convicted, faces a mandatory minimum prison term of at least five years and up to life, to be served consecutively to any other prison term imposed, and a fine of up to $250,000.
This indictment is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives; Department of Homeland Security – Immigration Customs Enforcement; Drug Enforcement Administration; Federal Bureau of Investigation; Tennessee Bureau of Investigation; Alcoa Police Department; Clinton Police Department; Harriman Police Department; Knoxville Police Department; Maryville Police Department; Oak Ridge Police Department; Anderson County Sheriff’s Office; Blount County Sheriff’s Office; Knox County Sheriff’s Department; Loudon County Sheriff’s Department; Roane County Sheriff’s Department; Fifth Judicial District Drug Task Force; and Ninth Judicial District Drug Task Force. Assistant U.S. Attorneys Tracy L. Stone and Brooklyn Sawyers will represent the United States.
Members of the public are reminded that an indictment constitutes only charges and that every person is presumed innocent until their guilt has been proven beyond a reasonable doubt.
Laredo Jury Convicts “Shrek” in Operation El PatronRead the Press Release
LAREDO, Texas – Oscar De Leon, aka “Shrek,” 38, of Laredo, has been convicted of multiple drug and international money laundering counts resulting from a long-term Organized Crime Drug Enforcement Task Force (OCDETF) investigation, announced United States Attorney Kenneth Magidson. The jury returned its verdict late yesterday following a three-day trial and approximately three hours of deliberation.
DeLeon was a co-conspirator working for a Laredo-based drug trafficking organization. He assisted with a drug conspiracy, existing from 2006 to 2010, that shipped cocaine, marijuana and U.S. currency from Mexico through Laredo to Atlanta, Ga., and throughout the United States. De Leon was convicted on drug and international money laundering conspiracy charges from 2006-2010 as well as possession with intent to distribute more than 100 kilograms of cocaine and more than 300 kilograms marijuana from May 2008 and May 2009, respectively.To date, a total of 38 co-conspirators have been convicted and sentenced as part of this investigation. During the course of the investigation that led to the convictions, federal agents seized more than $7.5 million in drug proceeds and more than 450 kilograms of cocaine. Agents also seized a drug ledger that attributes the movement/distribution of approximately 12,500 kilograms of cocaine and $41. 9 million in drug proceeds by these and other co-conspirators.
U.S. District Gregg Costa, who presided over this trial, has set sentencing for March 2014. At that time, DeLeon faces no less than 20 years and up to life in federal prison.The charges and resulting convictions are the result of OCDETF operations dubbed “Operation El Patron” and “Havoc” involving Homeland Security Investigations, Internal Revenue Service-Criminal Investigation and the Drug Enforcement Administration with the assistance of Webb County District Attorney’s Office, U.S. Border Patrol, Laredo Police Department and the Texas Department of Public Safety.
Assistant U.S. Attorneys Graciela Rodriguez Lindberg and Sanjeev Bhasker prosecuted the case.
LSU Academic Assistance Director, Assistant Director Sentenced for Stealing Federal FundsRead the Press Release
LAFAYETTE, La. –United States Attorney Stephanie A. Finley announced today that Dr. Marvette J. Thomas, 60, of Grambling, La., and Carra Sergeant, 60, of Ragley, La., were sentenced by U.S. District Judge Elizabeth E. Foote to 14 months and 12 months in prison respectively for theft of government funds. They were also ordered to pay $159,167 in restitution.
According to evidence presented at the guilty plea, Thomas served as Director of the Office of Academic Assistance, and Sergeant served as Assistant Director of Academic Assistance at Louisiana State University at Eunice (LSUE). From September 1, 2008 until February 28, 2012, Thomas and Sergeant used their positions to take funds from federal grants meant for the Upward Bound and Student Support Services projects, which are designed to assist students in their education efforts and goals. They used grant funds for their personal benefit and attempted to cover up their activities by altering receipts and submitting false records.
Thomas and Sergeant admitted to buying clothes, shoes, handbags, cosmetics, jewelry, personal electronic devices, cookware, tools, toys, recreational vehicle parts, pet supplies, household items, outdoor items, exercise equipment, religious books, and gifts for family, friends and co-workers. LSU auditors, U.S. Department of Education/Office of Inspector General, and the FBI estimate that Thomas spent at least $68,464 and Sergeant $74,653. Additionally, they allowed and encouraged subordinate co-workers to make personal purchases as well. The co-workers’ purchases total $16,050. A total of $159,167 was illegally spent under Thomas and Sergeant’s watch.
The Federal Bureau of Investigation, U.S. Department of Education/Office of Inspector General, and Louisiana State University auditors conducted the investigation. Assistant U.S. Attorney Myers P. Namie is prosecuting the case.
Jury Returns Guilty Verdicts Against Former Indian Casino Cashier and her HusbandRead the Press Release
Oklahoma City, Oklahoma – Kimberly Dawn Logsdon, of Chickasha, Oklahoma, was convicted yesterday of embezzling from an Indian casino, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. The jury also convicted both her and her husband, William Michael Logsdon, of failing to file federal tax returns.
The Silver Buffalo Casino was an Indian gaming establishment in Anadarko, Oklahoma, operated by the Apache Tribe of Oklahoma. Kimberly Logsdon was employed as a cashier clerk at the casino from July 25, 2007, until her termination on December 3, 2008. The jury heard evidence that from January of 2008 through November of 2008, Ms. Logsdon double-counted certain winning cashout vouchers presented by casino customers for payment and kept a total of $174,472.56. She duplicated payments by treating certain vouchers both as scanned by the computer system and as unscanned vouchers that were not entered into the casino’s computer system. The evidence also showed that neither she nor her husband, William Logsdon, filed federal income tax returns for 2008, in spite of having at least $144,800.00 in gross gambling winnings between May and December of 2008.
Following a five-day trial, the jury deliberated approximately four hours before finding Mrs. Logsdon guilty of embezzlement and both Mr. and Mrs. Logsdon guilty of failing to file federal tax returns. The jury was unable to reach unanimous verdicts on charges that Mr. Logsdon failed to report his wife’s embezzlement to law enforcement and that he committed perjury before a federal grand jury.
As a result of her conviction for casino embezzlement, Ms. Logsdon faces up to 20 years in prison and a $1,000,000 fine, plus mandatory restitution. Both defendants could be sentenced to one year in prison and a fine of $100,000 for failing to file federal tax returns. Reference is made to the second superseding indictment and other public filings for further information.
This case is the result of an investigation by the Bureau of Indian Affairs and the Internal Revenue Service Criminal Investigations. The case was prosecuted by Assistant U.S. Attorneys Scott E. Williams and Travis D. Smith.
Judge Sentences Cambria County Man to Probation for Conspiring to Grow MarijuanaRead the Press Release
JOHNSTOWN, Pa. - A resident of Hastings, Pa., has been sentenced in federal court to two years probation on his conviction of conspiracy to manufacture and possess marijuana plants, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Donald J. Weakland, 58.
According to information presented to the court, in the spring of 2011, Weakland conspired to manufacture and possess with the intent to distribute less than 100 marijuana plants. Evidence presented to the court at the time of Weakland's sentencing reflected that Weakland conspired with George M. Lowmaster and others to grow marijuana plants with the intent to facilitate and promote Lowmaster's drug distribution organization.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
A joint task force, headed by the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, conducted the investigation that led to the prosecution of Weakland. Other agencies participating on the task force include the Internal Revenue Service-Criminal Investigation, Pennsylvania State Police, Pennsylvania Attorney General's Office, Cambria County District Attorney's Office, Carrolltown Police Department, Patton Police Department, Ebensburg Police Department, Portage Police Department and the Paint Township Police Department.
Houston, Texas, Man Sentenced to 33 Years for April 2011 MurderRead the Press Release
St. Louis, MO - LODGY MICHAEL JACKSON of Houston, TX, was sentenced to 400 months imprisonment for the murder of Jamie Benson, of Houston, TX, on April 22, 2011. In February, Jackson pleaded guilty to three counts: conspiracy to possess with the intent to distribute over 500 grams of cocaine; conspiracy to possess a firearm in furtherance of a drug trafficking crime and discharging a firearm in furtherance of a drug trafficking crime where death resulted. Jackson was sentenced today by United States District Court Judge Audrey G. Fleissig.
According to court documents, in early April 2011, Jackson, co-defendants Scott Compton and Andreus O’Bryant, along with others, joined in a conspiracy that included robbing and murdering victim Benson within the City of St. Louis after luring Benson from Houston to St. Louis. Compton was recruited by O’Bryant to act as an individual interested in purchasing over 500 grams of cocaine from Benson for an inflated price. Compton played that role. In doing so, Compton, along with O’Bryant and Jackson, convinced Mr. Benson that a drug transaction was going to occur when, in reality, O’Bryant, Jackson and others intended to rob Benson of the cocaine and murder him.
Jackson, who was friends with Benson from living in Houston together, was brought to St. Louis, Missouri, by O’Bryant for purposes of carrying out the murder in exchange for compensation from O’Bryant. In the early morning hours of April 22, 2011, Jackson and Benson sat inside O’Bryant’s vehicle that was parked in a St. Louis alley. Benson was in the front passenger seat. Jackson sat directly behind him. To facilitate Benson’s murder, Jackson initiated a heated argument with Benson. As the argument continued, Jackson mouthed the words “watch this” to another passenger inside O’Bryant’s vehicle. Jackson then fired one shot into the back of Benson’s head from a firearm Jackson possessed. Jackson and others abandoned Benson's body in the alley, where it was later discovered by the St. Louis Metropolitan Police Department. Jackson, O’Bryant and others undertook significant efforts to cover up the conspiracy and destroy evidence of the crime, but were ultimately unsuccessful.
Jackson is the second of three defendants to be sentenced in this matter. Compton pleaded guilty for his involvement and has been sentenced to 5 years imprisonment. O’Bryant has also pleaded guilty. He awaits sentencing on February 10, 2014.
This case was investigated by the St. Louis Metropolitan Police Department; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the United States Marshals Service; the Franklin County Sheriff's Department and the St. Charles County Police Department.Hogsett Announces Sentencing of Indianapolis Man for Role in Plainfield Bank RobberyRead the Press Release
INDIANAPOLIS – Joseph H. Hogsett, the United States Attorney, announced today that Demetrius Worley, age 24, of Indianapolis, was sentenced this morning to 126 months (10 years, 6 months) by U.S. District Judge Jane Magnus-Stinson. This follows Worley’s guilty plea to charges related to an armed robbery of the State Bank of Lizton branch in Plainfield.
“Working with our partners on the FBI Safe Streets Task Force, we are cracking down on criminals who arm themselves and target Hoosier homes and businesses,” Hogsett said. “As the seriousness of this sentencing decision makes clear, those who embrace such violence and lawlessness will be caught, and they will be held fully accountable.”
“As a direct result of investigative teamwork by the FBI Safe Streets Task Force, Indianapolis Metropolitan Police Department and Plainfield Police Department, a violent bank robbery crew has been permanently dismantled,” said Robert A. Jones, Special Agent in Charge, FBI Indianapolis Division.
According to court documents, in May of this year members of the Safe Streets Task Force were investigating an armed robbery of a bank branch on Madison Avenue in Indianapolis. As part of that investigation, a vehicle that was believed to have been connected to that crime was being tracked by federal law enforcement.
On May 10, 2013, Task Force members tracked that vehicle from Indianapolis to Plainfield. Task Force members then observed two males, defendant Worley and William McKnight, enter the State Bank of Lizton branch. An alert was issued that an armed robbery might be in progress.
Worley and McKnight were observed leaving the bank and reentering a vehicle, and a pursuit of that vehicle began. The vehicle was next observed pulled over on the side of the road, and McKnight exited the vehicle before it sped away. McKnight was armed and refused to comply with orders to disarm. He was shot by law enforcement and is now deceased.
A pursuit of the vehicle continued, and after a traffic stop, a third individual was brought into custody. That defendant, Lori A. Armstrong, age 44, of Indianapolis, is currently awaiting trial. Defendant Worley, who had exited the vehicle earlier, was later brought into custody after being located in a nearby residential neighborhood. A search of the vehicle revealed clothing consistent with what the robbers were observed wearing, and a search of a nearby neighborhood resulted in the location of a purple bag containing approximately $6,900, consistent with the amount of loss suffered by the State Bank of Lizton.
According to court documents, at the time of the robbery defendant Worley was on parole relating to a conviction for bank robbery. Reviews of prison visitation records show that Worley visited McKnight while McKnight was incarcerated. This prosecution comes as part of the U.S. Attorney's Violent Crime Initiative, and is the result of a collaborative investigation by the Federal Bureau of Investigation, as well as the Indianapolis Metropolitan Police Department, Plainfield Police Department, and Hendricks County law enforcement partners.
Announced in March of 2011, the Violent Crime Initiative represents a district-wide strategy to work with local law enforcement and county prosecutors to combat drug traffickers and criminals that use and carry firearms in their illegal activities. The VCI has produced a dramatic increase in the number of gun-related charges brought federally. In the year preceding the initiative, there were just 14 defendants charged with federal gun crimes by the U.S. Attorney's Office. In the nearly two years since, more than 200 defendants have been charged.
According to Assistant U.S. Attorney A. Brant Cook who prosecuted the case for the government, Worley was also ordered to serve five years of federally-supervised release at the end of his prison term, and pay a $1,000 fine. Under federal law, Worley must serve a minimum of 85% of his prison term within a federal correctional facility.
A criminal complaint or indictment is only a charge and is not evidence of guilt. All defendants are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Georgetown Home Builder Sentenced to 69 Months for Bank Fraud, Embezzlement, Aggravated Identity Theft and A False Loan ApplicationRead the Press Release
Defendant used the identity of a five year old to fraudulently obtain loans
FRANKFORT, KY -Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, Perrye Turner, Special Agent in Charge, Federal Bureau of Investigation, and John E. Lucas, Special Agent in Charge, Federal Deposit Insurance Corporation, Office of Inspector General, jointly announced today that a home builder from Georgetown, KY., was sentenced to 69 months in federal prison for fraudulently obtaining more than a million dollars in loans from a Frankfort bank.
On Tuesday, U.S. District Judge Gregory Van Tatenhove sentenced 59 year-old Lee C. Tevis for bank fraud, a false loan application, aiding and abetting bank embezzlement and aggravated identity theft.
In August of 2013, after a five day trial, a federal jury convicted Tevis of the offenses and acquitted him of an additional conspiracy charge.
Evidence at trial established that, beginning in 2006, Tevis fraudulently obtained loans from American Founders Bank (AFB), by setting up bogus corporations in the names of other people to bypass loan limits, while constructing a house.
The evidence further establshed that Tevis used some of the loan money, which the bank intended to be used to fund a home in Frankfort, to pay off his personal loans and debt on other construction projects.
According to trial testimony, when Tevis reached loan limits established by the Bank, he set up a bogus corporation in the name of his company’s foreman, an illegal alien, in order to obtain more loans. After fraudulently qualifying for the loans, Tevis used the social security number of the foreman’s five year-old son to pass the bank’s credit check.
Tevis fraudulently received $1,095,000 in loans from the bank, according to the evidence at trial. The Bank eventually foreclosed on the home for which Tevis received the loans and suffered a significant financial loss.
Additionally, Jim Tate, the AFB president who approved the loans for Tevis, pleaded guilty to bank fraud and received a sentence of 36 months in prison.
Under federal law, Tevis must serve at least 85 percent of his prison sentence.
The investigation was conducted by the FBI and the FDIC-OIG. Assistant U.S. Attorneys Andrew Sparks and Jim Arehart represented the U.S. Attorney’s Office in this case.
Frederick Walter Schroeder Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Helena, on December 10, 2013, before U.S. District Judge Sam E. Haddon, FREDERICK WALTER SCHROEDER, a 52-year-old resident of Livingston, was sentenced to a term of:
- Prison: 50 months
- Special Assessment: $100
- Forfeiture: firearms
- Supervised Release: 3 years
SCHROEDER was sentenced in connection with his guilty plea to being a felon-in-possession of a firearm.
In an Offer of Proof filed by Assistant U.S. Attorney Laura B. Weiss, the government stated it would have proved at trial the following:
On June 25, 2012, SCHROEDER was convicted of felony assault with a weapon, thereby prohibiting him from possessing firearms.
In the fall of 2012, probation executed a search on SCHROEDER's residence and located several firearms in his home.
A friend of SCHROEDER's indicated that he was in possession of SCHROEDER's firearms during the pendency of the case. However, he indicated that in the fall of 2012, SCHROEDER came to the friend's house and said he could take his firearms back and put them in a storage unit. SCHROEDER then took his firearms from the friend's house.
SCHROEDER's account of the events was that his friend brought several of the firearms to his (SCHROEDER's) house and hid them.
Because there is no parole in the federal system, the truth in sentencing guidelines mandate that SCHROEDER will likely serve all of the time imposed by the court. In the federal system, SCHROEDER does have the opportunity to earn a sentence reduction for good behavior. However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Former Walker Machinery Branch Manager Pleads Guilty to Federal Fraud ChargeRead the Press Release
Mark R. Trump stole $90,000 in rental fees owed to the company
BECKLEY, W.Va. – A former branch manager for heavy equipment distributor Cecil I. Walker Machinery Company (“Walker Machinery”) faces up to 20 years in prison after pleading guilty yesterday in connection with a scheme that bilked a total of more than $90,000 in rental fees from the company, announced United States Attorney Booth Goodwin. Mark Randall Trump, of Cool Ridge, Raleigh County, W.Va., pleaded guilty to wire fraud before United States District Judge Irene C. Berger in Beckley.
In 2009 and continuing up until his dismissal from Walker Machinery in April 2012, Trump, 43, a branch manager at Walker Express, the company’s full-line rental service store based in Crab Orchard, W.Va., began offering certain customers special rates for equipment rentals without the company’s authorization. An investigation revealed that during the scheme, Trump was paid directly, often by cash or personal check, by certain customers for numerous equipment rentals. Trump later deposited the fraudulent payments into his personal checking account. To conceal the scheme from Walker Machinery, Trump entered the customer data into the company’s system and printed a matching rental agreement form. However, upon the return of the equipment, Trump made entries into the company’s records indicating that the rental had been cancelled, deleted from the computer system, or not invoiced at all. Trump also failed to process the receiving paperwork through Walker Machinery’s service department, as required for all company rental transactions.
In total, Trump took approximately $90,000 in rental fees owed to the company for his personal use. As a result of the fraud, the company incurred a loss of approximately $367,000.
Trump is scheduled to be sentenced on April 17, 2014.
The investigation was conducted by the West Virginia State Police and the FBI. Assistant United States Attorney Blaire Malkin is in charge of the prosecution.
This case is being prosecuted as part of the United States Attorney’s Office for the Southern District of West Virginia’s Business Protection Initiative. U.S. Attorney Booth Goodwin announced the Business Protection Initiative in November 2010. Business protection is a primary initiative of the U.S. Attorney’s Office that focuses on prosecuting individuals who defraud West Virginia businesses.
Former Union President Sentenced for Misusing Union FundsRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that David Kellner, 49, of Delevan, N.Y., the former president of the Transport Workers Local 2020, who was convicted of filing a false financial report with the Secretary of Labor, was sentenced to two years probation, to include six months of home detention, by U.S. Magistrate Judge Jeremiah J. McCarthy. In addition, Kellner was ordered to pay a fine of $2,000 and make restitution in the amount of $12,226 to the Transport Workers union.
Assistant U.S. Attorney John E. Rogowski, who handled the case, stated that as president of Transport Workers Local 2020 from 2006 through 2009, the defendant filed with the Department of Labor, Labor-Management Standards, form LM-3 for the years 2007 and 2008. The form requires that all payments to officers be disclosed. Kellner failed to disclose that he had filed false invoices with the union. As a result, the defendant was reimbursed over $12,000 for expenses he did not incur or were paid for by the national union or Kellner's employer.
The sentencing is the result of an investigation on the part of Special Agents of the United States Department of Labor, Office of Labor-Management Standards, under the direction of Acting District Director Mark J. Neylon.Former Telco Federal Credit Union Employee Sentenced for Making False EntriesRead the Press Release
ROCHESTER, N.Y.CU.S. Attorney William J. Hochul, Jr. announced today that Donna Harabin, 61, of Clearwater, Florida, who was convicted of making false credit institution entries, was sentenced to time served by U.S. District Judge David G. Larimer.
Assistant U.S. Attorney Tiffany H. Lee, who handled the case, stated between January 2008 and December 2008, Harabin was president and manager of Telco Federal Credit Union in Elmira, N.Y. During that time, the defendant changed the delinquency dates and falsified payment entries on various loan accounts when she knew that the accounts were delinquent and in default. Harabin changed the due dates and payment information in the reports to make the loans appear more current.
The sentencing is the culmination of an investigation on the part Special Agents from the Federal Bureau of Investigation, under the direction of Special Agent in Charge Brian P. Boetig.Former Teacher Pleads Guilty to Production of Child Pornography and Other Charges Following Federal InvestigationEric Justin Toth Fled Area Upon Discovery of Crimes; Former FBI Top Ten Fugitive Was Captured This Year in NicaraguaRead the Press Release
WASHINGTON – Eric Justin Toth, 31, a former private school teacher and camp counselor, pled guilty today to three counts of production of child pornography and other felony charges following an investigation that began more than five years ago with the discovery of pornographic images on a school camera that had been in his possession.
The guilty plea was announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; Rod J. Rosenstein, U.S. Attorney for the District of Maryland; John W. Vaudreuil, U.S. Attorney for the Western District of Wisconsin; Robert L. Pitman, U.S. Attorney for the Western District of Texas; Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida; John S. Leonardo, U.S. Attorney for the District of Arizona; John R. Marti, Acting U.S. Attorney for the District of Minnesota; John McCarthy, State’s Attorney for Montgomery, County, Md.; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD), and J. Thomas Manger, Chief of the Montgomery County, Md. Police Department.
Toth pled guilty in the U.S. District Court for the District of Columbia. In addition to the child pornography charges, he pled guilty to one count each of misuse of a Social Security number and identity theft. The plea agreement, which is contingent upon the Court’s approval, calls for Toth to be sentenced to between 22 and 30 years in prison. Following completion of the prison term, the plea agreement calls for Toth to be placed on at least 25 years of supervised release. He also would be required to register as a sex offender for at least 25 years. If he approves the plea, the Honorable Rudolph Contreras is to sentence Toth on March 11, 2014.
The guilty plea resolves charges and potential charges in several jurisdictions, including the District of Columbia, Maryland, Wisconsin, Texas, Minnesota, Arizona, and Florida.
**“Eric Toth is every parent’s worst nightmare: a serial predator who took advantage of his position as a camp counselor and a teacher to sexually exploit children in his care,” said U.S. Attorney Machen. “After five years of eluding justice, Toth was captured in Nicaragua, where he was living under an alias, with more than 1,000 child pornography images on his computer. For all his efforts to run away from his crimes, today Toth faces the justice he deserves: up to 30 years in prison.”
“Today, Eric Toth took responsibility for producing pornographic images of children who were entrusted to his care,” said Assistant Director in Charge Parlave. “The unfortunate reality is that Toth, an audacious and prolific child predator, is representative of many abusers in our communities who prey upon children in places where we believe they are safe. Together as a society, we must be vigilant observers of a child’s behavior and talk to children about how to come forward when they feel in danger.”
“It is important that this defendant be held accountable,” said State’s Attorney McCarthy. “His reprehensible acts scar children for life. By entering a global plea, the victims of this child predator will not be further traumatized. Today is an important first step towards healing for the victims and their families.”
The investigation of Toth began in June 2008 with the discovery of images depicting child pornography on a camera at a private school in the District of Columbia, where he had been teaching. School administrators called the police, and security officers immediately escorted Toth from the school campus. Toth left the area soon thereafter, while the law enforcement investigation was continuing. Federal charges were filed against him in 2008 in the District of Columbia and Maryland. Toth, meanwhile, remained at large, traveling to multiple places.
Toth was placed on the FBI’s Ten Most Wanted Fugitives list in April 2012 and finally apprehended in Nicaragua in April 2013.
The three child pornography charges included in the guilty plea stem from photographs and videos that Toth took of children while working in 2005 as a camp counselor in northwest Wisconsin; as a teacher in 2006 at the private school in the District of Columbia; and at a private home in Maryland in 2007. These photographs and videos were located on a camera and media card found at the school in June 2008 and on a thumb drive found in Toth’s car when it was located at the Minneapolis-St. Paul International Airport in August 2008. Additionally, Toth pled guilty to misuse of a Social Security number for using someone else’s identifying information while working in Texas from 2009 until 2012. The identity theft charge stems from Toth’s use, in Texas, Florida, and elsewhere, of yet another person’s identifying information to obtain and travel with a false passport.
As part of the plea agreement, Toth will not face charges for additional images of child pornography that were found on computers that Toth used. In June 2009, after law enforcement learned that Toth had been living and working at homeless shelter in Phoenix, authorities discovered a laptop computer that Toth had been using that contained images depicting child pornography. Toth had already left Phoenix at the time of this discovery. In addition, after Toth’s arrest, law enforcement discovered images and videos depicting child pornography on a laptop computer that Toth used when he lived in Texas and Nicaragua.
This case was investigated by the FBI’s Washington Field Office; the Metropolitan Police Department; the Montgomery County, Md., Police Department, and other agencies.
This case was prosecuted by Assistant U.S. Attorney Cassidy Kesler Pinegar of the U.S. Attorney’s Office for the District of Columbia, Special Assistant U.S. Attorney Lisa Marie Freitas of the U.S. Attorney’s Office for the District of Maryland, and Assistant State’s Attorney Donna Fenton of the Montgomery County, Md. State’s Attorney’s Office.
Assistance during the investigation was provided by the U.S. Attorney’s Offices from the Western District of Wisconsin; the Western District of Texas; the Southern District of Florida; the District of Arizona, and the District of Minnesota; the Montgomery County, Md. State’s Attorney’s Office; the U.S. Embassy Managua Regional Security Office; the Diplomatic Security Service Criminal Investigative Liaison Branch; U.S. Customs and Border Protection; the U.S. Marshals Service's National Sex Offender Targeting Center; and the National Center for Missing and Exploited Children - Sex Offender Tracking Team.
The Nicaraguan National Police (NNP) Commissioner's Office, the NNP Trafficking in Persons Unit, and the Nicaraguan Immigration Service performed crucial work in securing Toth’s apprehension.
Those assisting from the U.S. Attorney’s Office for the District of Columbia include Assistant U.S. Attorneys Julieanne Himelstein, Catherine K. Connelly, David Johnson and Virginia Cheatham, and former Assistant U.S. Attorneys Angela Schmidt and Michelle Zamarin. Paralegal Specialist Toni Donato also provided assistance.
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