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Thursday 5 December 2013
Prison and Restitution Ordered for Fairborn Market Owner Who Illegally Accepted “food Stamp” BenefitsRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
DAYTON –George J. Daoud, 65, was sentenced in U.S. District Court to 14 months in prison and ordered to repay the government $131,000 for illegally swapping “food stamps” for ineligible items including drug paraphernalia and a car as the owner of the Main Express Food Mart in Fairborn, Ohio. Daoud also committed unemployment insurance fraud against the Ohio Department of Jobs and Family Services by claiming he was not working when he was in fact running a business enterprise.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Joe Smith, Special Agent in Charge, U.S. Department of Agriculture, Office of Inspector General (USDA), James Vanderberg, Special Agent in Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Mark Porter, Special Agent in Charge, U.S. Secret Service, and John Born, Director, Ohio Department of Public Safety announced the sentence imposed December 4 by U.S. District Judge Thomas M. Rose.
Investigators began looking into the market after receiving complaints that the store was selling ineligible products to people with Supplemental Nutrition Assistance Program (SNAP) benefits. SNAP benefits, formerly known as “food stamps”, are to be used only for the purchase of eligible food items. Participants in the program access the benefits using an Electronic Benefits Transfer or EBT card. According to court documents, Daoud and his co-conspirators accepted EBT cards in exchange for ineligible items such as cigarettes and alcohol, articles of drug paraphernalia, cash, and a motor vehicle.
Daoud has already paid the restitution and also forfeited $65,564 in seized assets.
Investigators found that Daoud directly or indirectly participated in at least 500 separate fraudulent transactions between February 2010 and January 2012. Daoud pleaded guilty on October 16, 2012 to one count each of conspiracy to launder money, unauthorized use of SNAP benefits, and theft of public monies.
“One of the U.S. Attorney’s primary missions is to protect public funds,” U.S. Attorney Stewart said. “We will continue to work to protect the integrity of government programs designed to assist those who need it most.”
Store employee Nicholas G. Butcher, 54, of Fairborn, pleaded guilty on June 18, 2012 to one count of conspiracy. He was sentenced on September 28, 2012 to five years’ probation and named, along with Daoud, in an order to pay $200,000 in restitution to the U.S. Department of Agriculture.
Stewart commended the cooperative investigation between agents of the USDA Inspector General, Labor Inspector General, Secret Service and the Ohio Investigative Unit which is part of the Ohio Department of Public Safety. He also recognized Assistant U.S. Attorney Dwight Keller, who represented the United States in the case.
Prior Sex Offender Sentenced to Fifteen Years and a Lifetime of Supervised Release for Child Pornography ConvictionRead the Press Release
ALBUQUERQUE – This afternoon, a federal judge sentenced John W. Vandermeer, 63, of Albuquerque, N.M., to 15 years in prison followed by a lifetime of supervised release for his child pornography charges. He also was fined $10,000.00. Vandermeer will be required to register as a sex offender after he completes his prison sentence.
The sentence was announced by Acting U.S. Attorney Steven C. Yarbrough, Special Agent in Charge Dennis A. Ulrich, II, of Homeland Security Investigations (HSI) in El Paso, Texas, and Chief Peter N. Kassetas of the New Mexico State Police (NMSP).
Vandermeer was arrested in Dec. 2012, on a criminal complaint alleging that he received and possessed child pornography in Bernalillo County, N.M., between Jan. 2011 and Nov. 2012. He subsequently was indicted and charged with three counts of receipt of child pornography and two counts of possession of child pornography. The indictment alleged that Vandermeer received child pornography from Jan. 2009 through April 16, 2011 and that he possessed child pornography in Dec. 2012, in Bernalillo County.
On July 30, 2013, Vandermeer entered a guilty plea to a receipt of child pornography charge. In his plea agreement, Vandermeer acknowledged that HSI and NMSP executed a search warrant at his residence on Dec. 4, 2012, and seized computers and computer-related media. The search warrant was issued based on an undercover investigation by the NMSP that began in Nov. 2012, and revealed that an IP address subscribed to Vandermeer was being used to download child pornography images and videos through a peer-to-peer file-sharing program.
During his plea hearing, Vandermeer also acknowledged voluntarily participating in a recorded interview on Dec. 4, 2012, during which he admitted downloading child pornography images and videos of prepubescent children. He also admitted having a prior conviction for raping a child under the age of 14 years and that he moved from Massachusetts to Albuquerque in 1987 after he was convicted of child rape. Vandermeer also stated that he was involved in Albuquerque theater productions involving children.
Vandermeer received an enhanced sentence of 15 years in prison because of his prior sex offense conviction. As required by plea agreement, Vandermeer was ordered to forfeit his computers and computer-related media.
This case was investigated by the Albuquerque office of HSI, the Online Predator Unit of the NMSP and the New Mexico Regional Computer Forensic Laboratory. It was prosecuted by Assistant U.S. Attorney Marisa A. Lizarraga and former Assistant U.S. Attorney Charlyn E. Rees as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 64 federal, state and local law enforcement agencies associated with the ICAC Task Force, which is funded by a grant administered by the New Mexico Attorney General’s Office. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
President of Pittsburgh-area Financial Services Firm Pleads Guilty in $2.8M Fraud SchemeRead the Press Release
PITTSBURGH - A Pittsburgh businessman pleaded guilty in federal court to charges of violating federal laws, United States Attorney David J. Hickton announced today.
Ronald A. Moog, 78, of Pittsburgh, PA, pleaded guilty to one count of wire fraud and two counts of mail fraud before United States District Judge Nora Barry Fischer.
In connection with the guilty plea, the court was advised that the government’s evidence would establish that the defendant was the President of Moog Transfinancial Services, a Pittsburgh based corporation in the business of auditing freight bills for other companies who had a large volume of freight business. According to Moog’s contractual relationship with the victim companies, Moog would inform the victims of the payment necessary to pay off their freight charges. The victims would then send Moog money, which Moog would place into a trust account. For nearly 13 years, the defendant syphoned money out of the trust account for purposes other than paying the victims’ freight bills, leading to a shortfall within the account of over $2.8 million. This amount was passed onto the victim companies in the form of delinquent freight invoices which they had already sent money to Moog to pay for and which they believed had been already paid.
Judge Fischer scheduled sentencing for April 4, 2014 at 9 a.m. The law provides for a total sentence of 60 years in prison, a fine of $750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.
Pending sentencing, the court continued Moog on bond.
Assistant United States Attorney James T. Kitchen is prosecuting this case on behalf of the government.
The United States Postal Inspection Service conducted the investigation that led to the prosecution of Moog.
Portland Sex Trafficker Sentenced to 200 Months in Federal PrisonRead the Press Release
Portland, Ore. — Anthony Dennell Armstrong, 25, of Portland, Oregon, was sentenced to 200 months in prison today by United States District Judge Michael W. Mosman, for transporting a 14-year-old girl from Oregon to Arizona for the purpose of prostitution. On August 15, 2013, Armstrong pleaded guilty to one count of transporting a minor across state lines for prostitution. Upon release from custody, Armstrong will serve a 10-year period of supervised release. During his supervised release, he must abide by a number of conditions, including registration as a sex offender.
“Sex trafficking of children is the same thing as sending a child into a hotel room to be raped, night after night,” said U.S. Attorney Amanda Marshall. “We will continue to prosecute aggressively anyone who recruits our children into this dark world.”
In imposing the 200-month sentence, Judge Mosman noted that there is nothing to distinguish the crime of sex trafficking of children from the crime of rape. He stated that sex trafficking of children is among the most serious of offenses, and added that the trafficking in this case was especially serious in light of the young age of the victim, the repeated acts of personal violence, the interstate travel, and the duration of the offense.
The government alleged that Armstrong recruited the victim into prostitution when she was just fourteen years old, and continued to traffic her until she was eighteen years old. He transported the victim from Oregon to Phoenix, Arizona for the purpose of prostitution, as well as to Las Vegas and southern California. The government alleged that Armstrong subjected the victim to regular beatings, including when she broke his rules, did not make enough money, or refused to work as a prostitute.
This case stemmed from a coordinated investigation by the Federal Bureau of Investigation’s (FBI) Child Exploitation Task Force. The FBI’s Child Exploitation Task Force marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children through sex trafficking, as well as to identify and rescue victims. The case was prosecuted by Assistant U.S. Attorney Stacie Beckerman.
Pocatello Men Sentenced for Distributing MethRead the Press Release
POCATELLO – James Argyle Merrill, 38, and Dalyn Ray Pfeaster, 46, both of Pocatello, were sentenced today in federal court for distributing methamphetamine, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Brian Ted Stewart of the District of Utah sentenced Merrill to 36 months and Pfeaster to four months in prison. Both will serve three years of supervised release following their prison sentence. The defendants pleaded guilty to the charge on August 28, 2013.
According to plea agreements filed in the case, on January 23, 2013, Merrill delivered methamphetamine to an individual at a parking lot in Bingham County. On January 8, 2013, Pfeaster delivered methamphetamine to an individual in Pocatello. The defendants admitted to knowing the substance they delivered to the individuals was methamphetamine.
On Monday, co-defendant Kyle Mark Ross, 28, of Pocatello, was sentenced by Chief U.S. District Judge B. Lynn Winmill to a period of time served and three years of supervised release for possession with intent to distribute methamphetamine.
The case was investigated by the Idaho State Police.
Philadelphia Man Indicted on Charges Involving Child PornographyRead the Press Release
Brian Welsh, 22, of Philadelphia, Pennsylvania, is charged by Indictment , unsealed today, with one count of receipt of child pornography, one count of distribution of child pornography, and one count of possession of child pornography announced United States Attorney Zane David Memeger. The indictment alleges that on April 30th, Welsh was in possession of child pornography; that on May 23, 2012, Welsh received visual images of child pornography; and that on June 24, 2012, Welsh distributed child pornography. Welsh was arrested Decemeber 3, 2013 and is awaiting a detention hearing.
If convicted the defendant faces a maximum possible sentence of 50 years in prison.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was investigated by Immigration and Customs Enforcement Homeland Security Investigations and is being prosecuted by Special Assistant United States Attorney Karen A. Fox.
Click here to view the indictment
An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Pennsylvania Woman Charged with Millions of Dollars in Fraudulent Sales of Telecom EquipmentRead the Press Release
NEWARK, N.J. – A Pennsylvania woman was indicted by a federal grand jury today for her role in a long-running, large-scale scheme involving the fraudulent sale of telecommunications equipment belonging to a company she worked for as a consultant, U.S. Attorney Paul J. Fishman announced.
Juanita L. Berry, 45, of Philadelphia, Pa., was charged in an indictment with three counts of wire fraud that allegedly caused losses of at least $3.5 million.According to the indictment and other documents filed in this case:
From 2008 to 2011, Berry worked as a consultant for an Indiana company that installed and removed telecommunications systems, first as a sales representative and later as the company’s vice president for major accounts. Initially, Berry worked out of the company’s Levittown, Pa., facility and, later, out of its Dayton, N.J., facility. The “brains” of the telecommunications systems the company installed and removed were the electronic circuit boards of varying complexity that range in price between several hundred to tens of thousands of dollars.
Berry owned a company named J. Starr Communications Inc., (J. Starr) through which she arranged her consulting agreement and allegedly operated her fraudulent scheme.
Without the knowledge or authorization of the telecommunications company’s management, Berry sold both used cards and new cards with other telecommunications equipment owned by the company as though such equipment belonged to her or J. Starr. She then pocketed the proceeds from such fraudulent sales. Berry deceived employees at the Levittown and Dayton facilities into thinking that the shipments of used cards were part of the telecommunications company’s normal course of business.
Berry allegedly deceived the company’s management in Indiana and other company employees on site about her activities by altering internal project reports and blaming others for the missing cards. Berry deceived a company in Florida that purchased the equipment into thinking that she or her company J. Starr had title to that equipment. Between 2008 and 2011, the Florida company that purchased the cards from Berry or J. Starr wired in excess of $3.5 million in payment to J. Starr’s bank account.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, for the investigation leading to today’s charges.
The government is represented by Assistant U.S. Attorney Bohdan Vitvitsky of the U.S. Attorney’s Office Economic Crime Unit in Newark.
The charges and allegations contained in the indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.
13-456
Defense counsel: Paul D. Petrus Esq., New York
Berry, Juanita Indictment
Peabody Investment Advisor Charged with Defrauding ClientsRead the Press Release
BOSTON - A Peabody investment advisor was arrested today after being charged with defrauding several Boston-area residents out of their retirement savings.
John Michael Babiarz, 39, was charged in a six-count indictment unsealed today with wire fraud, mail fraud, money laundering and aggravated identity theft. Babiarz was previously charged in an administrative complaint brought by the Massachusetts Securities Division with engaging in unregistered and fraudulent activities in violation of the Massachusetts Uniform Securities Act and applicable regulations.
The indictment alleges that, following his termination in September 2011 from Bishop, Rosen & Co., a retail brokerage firm headquartered in New York, Babiarz falsely told certain former clients that he had taken a job at Fidelity Investments, the Boston-based asset management firm. Babiarz told other clients that he was working as an independent financial advisor. In fact, Babiarz did not work at Fidelity, and has never been employed by that firm. Babiarz told his clients that he could continue to manage their money if they opened brokerage accounts at Fidelity. Babiarz assisted the individuals in opening such accounts online, and in so doing, set up the user names and passwords for those accounts. Unbeknownst to his clients, Babiarz then caused their funds – or money he borrowed in their names on margin – to be diverted to accounts that he controlled at several other banks and brokerage firms. Babiarz used the money to buy a new home and to pay other personal expenses. As part of the case the government is seeking the forfeiture of a single-family home Babiarz recently purchased in Peabody.
If convicted on the charge of wire and mail fraud, Babiarz faces a maximum sentence of 20 years in prison, three years of supervised release and a fine of the greater of $250,000 or twice the gain or loss from the offense; on the charge of money laundering, Babiarz faces a maximum sentence of 10 years in prison, three years of supervised release and a $250,000 fine; and on the charge of aggravated identity theft Babiarz faces a mandatory consecutive term of two years in prison.
United States Attorney Carmen M. Ortiz and Kevin Niland, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. Assistance was also provided by the Massachusetts Securities Division and the Essex County District Attorney’s Office. The case is being prosecuted by Assistant United States Attorney Stephen E. Frank of Ortiz’s Economic Crimes Unit.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Owner of DTS Medical Supply Company in Devine, TX, and Two Employees Charged in Connection with $3.5 Million Health Care Fraud SchemeRead the Press Release
A federal grand jury has indicted 52–year-old DTS Medical Supply Company owner Daniel Thomason Smith and two employees, in connection with an estimated $3.5 million Health Care Fraud scheme announced United States Attorney Robert Pitman, FBI Special Agent in Charge Armando Fernandez and Texas Attorney General Greg Abbott.
A 21-count indictment returned yesterday in San Antonio charges Smith; 42-year-old DTS office manager Kathleen Marina Kelly-Tuorila of Devine, TX, and 57–year-old Robin Renee Haigler of Waco, TX, with one count of conspiracy to commit Health Care Fraud, one count of aiding and abetting Health Care Fraud, eleven counts of aiding and abetting aggravated identity theft and eight counts of aiding and abetting false statements related to a Health Care matter.
According to the indictment, both Medicare and Medicaid provide qualified beneficiaries with financial remuneration for the purchase of prescribed and necessary medical equipment. Such medical equipment would include powered wheelchairs, powered scooters and accessories related to those two devices. Medicare and Medicaid set a rate of compensation for each of these devices and the rate of compensation differed between devices and was to be based on the type of device that was prescribed for the beneficiary and delivered to the beneficiary.
The indictment alleges that between May 2006 and January 2010, the defendants conspired to submit numerous false and fraudulent benefit claims to Medicaid and Medicare seeking compensation for powered wheelchairs. Smith employed Haigler on a commission basis to recruit customers primarily in the Waco area. At Smith’s direction, Haigler filled out benefit claims for customers that contained false information, including fraudulent prescriptions which she oftentimes generated, and then forwarded those claims to Kelly-Tuorila for submission to Medicaid and Medicare for reimbursement. Haigler would then arrange to deliver a “power scooter,” an item which has a lower Medicaid/Medicare reimbursable rate, to customers instead of the powered wheelchair that Medicaid and Medicare were billed for. This resulted in a larger payment from Medicaid/Medicare and a larger percentage of profit for DTS and Smith.
Upon conviction, the defendants face up to ten years imprisonment on the conspiracy count; up to ten years imprisonment on the aiding and abetting Health Care Fraud count; up to two years in federal prison for each aggravated identity theft count; and, up to five years in federal prison for each false statement count.
This indictment resulted from an investigation conducted by the agents with the Federal Bureau of Investigation together with investigators from the Texas Medicaid Fraud Control Unit. Assistant United States Attorney Greg Surovic is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Oregon Man Sentenced in Magic Valley “Spice” CaseRead the Press Release
Defendant and Four Others Indicted in 2012 in Nationwide Law Enforcement Action
POCATELLO – Joshua P. Becker, 33, of Portland, Oregon, was sentenced today in U.S. District Court in Pocatello to 48 months in prison for conspiracy to launder money, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Brian Ted Stewart of the District of Utah also ordered Becker to serve three years of supervised release, pay a $500 fine, and forfeit assets involved in the criminal activity. Becker pleaded guilty to the charge on May 30, 2013.
In October 2013, co-defendants Gary E. Nagel, 46, and Joshua Cserepes, 27, of Twin Falls, Idaho, and Shyloh Becker, 29, of Portland, Oregon, were each sentenced to 36 months’ probation and fined $500 for related charges, including possession with intent to distribute a controlled substance analogue, conspiracy to sell drug paraphernalia, and aiding and abetting in a monetary transaction in property derived from specified unlawful activity, respectively.
Co-defendant Allen W. Nagel, 44, of Twin Falls, is scheduled to be sentenced on January 3, 2014, before Chief U.S. District Judge B. Lynn Winmill in Pocatello. He pleaded guilty in June 2013, to conspiracy to launder money.
According to court documents, between March 1, 2011, and June 25, 2012, Allen Nagel owned and operated A & J Distribution with other individuals, including co-defendant Joshua Becker. During this time, A & J Distribution distributed brands of smokeable material for further sale, commonly referred to as “spice,” under the “Hayze” label. This material contained 5-:fluoro-RR-144 (XLR11), a Schedule I controlled substance analogue, which Allen Nagel admitted he knew was intended for human consumption. Nagel and Becker received money from the sale of the material and engaged in monetary transactions using the funds derived from the illegal sales. The transactions, some in excess of $10,000, included transfers, withdrawals, and deposits through a Twin Falls bank.
Fourteen search warrants were executed in July 2012 by law enforcement agencies at 11 locations in Twin Falls County, and three locations in Tigard, Oregon, and Vancouver, Washington. The warrants were related to a nationwide law enforcement action against the synthetic designer drug industry responsible for the production and sale of dangerous and deadly drugs that are often marketed as bath salts, “spice,” incense, or plant food, which are prohibited under the federal controlled substance analogue statute. Operation Log Jam targeted every level of the synthetic drug industry, including retailers, wholesalers, and manufacturers, in more than 80 U.S. cities.
The joint investigation of the Organized Crime and Drug Enforcement Task Force (OCDETF), is led by the Drug Enforcement Administration in conjunction with Twin Falls City Police Department, Twin Falls County Sheriff's Office, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), Internal Revenue Service-Criminal Investigation, U.S. Customs and Border Patrol, U.S. Postal Inspection Service, Bureau of Alcohol, Tobacco, Firearms and Explosives, Idaho State Police, Ada County Sheriff's Office, Nampa City Police Department, Meridian City Police Department, Gooding County Sheriff's Office, Cassia County Sheriff's Office, and Minidoka County Sheriff's Office.
The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
Oklahoma Man Pleads Guilty to Role in Lee Michaels Jewelry Store HeistRead the Press Release
In San Antonio, 45-year-old Johnny Kirk of Oklahoma City, OK, admitted to his role in the March 2010 robbery of the Lee Michaels Jewelry Store announced United States Attorney Robert Pitman and FBI Special Agent In Charge Armando Fernandez, San Antonio Division and San Antonio Police Chief William McManus.
Appearing before United States Magistrate Judge Pamela Mathy this morning, Kirk pleaded guilty to one count of aiding and abetting the transportation of stolen goods and one count of aiding and abetting the interference with commerce by threats and violence. Kirk remains in federal custody pending sentencing which is scheduled for 9:30am on March 3, 2014, before Senior United States District Judge David Ezra.
By pleading guilty, Kirk admitted that on March 24, 2010, he robbed the Lee Michaels Jewelry Store located in North Star Mall in San Antonio in which an estimated $2.3 million worth of merchandise was stolen.
On October 7, 2013, 47-year-old co-defendant Marvin Steel of Oklahoma City was sentenced to 20 years in federal prison and ordered to pay $1,174,134 restitution after pleading guilty to one count each of aiding and abetting the transportation of stolen goods, aiding and abetting the interference with commerce by threats and violence, and aiding and abetting the use and carrying of a firearm during a crime of violence.
Several months following the robbery, the investigation turned to Oklahoma when a Rolex watch stolen during the heist was sold. Authorities subsequently executed several search warrants in Oklahoma, including a search warrant at Marvin Steele’s residence and a search warrant at the residence of Marvin Steele’s brother. Agents recovered Rolex watches and various pieces of jewelry, valued at approximately $800,000, stolen from Lee Michaels Jewelry Store in San Antonio as well as a blue laundry bag identical to those used during the robbery.
This investigation was conducted by the FBI/SAPD Safe Streets Task Force along with the Oklahoma FBI and the SAPD Robbery Unit. Assistant United States Attorneys Tom Moore and Michael Hardy are prosecuting this case on behalf of the Government.
New York Antiques Dealer Sentenced to 37 Months in Prison for Wildlife SmugglingRead the Press Release
Qiang Wang, aka Jeffrey Wang, a New York antiques dealer, was sentenced in federal court in Manhattan today to 37 months in prison to be followed by three years of supervised release for conspiracy to smuggle Asian artifacts made from rhinoceros horns and ivory and violate wildlife trafficking laws, announced Robert G. Dreher, the Acting Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice, Preet Bharara, U.S. Attorney for the Southern District of New York, and Dan Ashe, Director of the U.S. Fish and Wildlife Service.
Wang was arrested in February 2013 as part of “Operation Crash,” a nation-wide crackdown in the illegal trafficking in rhinoceros horns, for his role in smuggling “libation cups” carved from rhinoceros horns from New York to China. Wang was sentenced today by U.S. District Judge Katherine B. Forrest of the Southern District of New York.
“Smuggling wildlife artifacts made from rhino horn and elephant ivory undermines the international conservation protections put in place to save these species from extinction ,” said Acting Assistant Attorney General Dreher. “This is an active and ongoing investigation that is designed to send a clear message to buyers and sellers that we will vigorousl y investigate and prosecute those who are involved in this devastating trade.”
“With his sentence today, Qiang Wang is held accountable for his role in feeding the flourishing black market for artifacts made from endangered species,” said U.S. Attorney Bharara. “This Office will continue its work to prosecute those who contribute to the illegal wildlife trade, and to uphold the rules designed to protect wildlife.”
“ We’re reaching a tipping point, where the unprecedented slaughter of rhinos and elephants happening now threatens the viability of these iconic species’ wild populations in Africa,” said U.S. Fish and Wildlife Service Director Dan Ashe. “This slaughter is fueled by illegal trade, including that exposed by Operation Crash. We will continue to work relentlessly across the United States government and with our international partners to crack down on poaching and wildlife trafficking.”
According to the information, plea agreement and statements made during court proceedings:
In China, there is a tradition dating back centuries of intricately carving rhinoceros horn cups. Drinking from such a cup was believed by some to bring good health, and antique carvings are highly prized by collectors. Libation cups and other ornamental carvings are particularly sought after in China and in other Asian countries, as well as in the United States. The escalating value of such items has resulted in an increased demand for rhinoceros horn that has helped fuel a thriving black market, including fake antiques made from more recently hunted rhinoceros.
In pleading guilty, Wang admitted to participating in a conspiracy to smuggle objects carved from rhinoceros horn and elephant ivory out of the United States knowing that it was illegal to export such items without required permits. Due to their dwindling populations, all rhinoceros and elephant species are protected under international trade agreements. Wang falsely labeled the packages in order to conceal the true contents and did not declare them as required. Special Agents with the U.S Fish & Wildlife Service executed a search of Wang’s apartment in Flushing, New York, and found documents showing Wang was involved in buying rhino horn and ivory artifacts and smuggling them to China. Agents seized two ivory carvings, including one found hidden behind Wang’s bed that were forfeited as part of the sentence. Numerous photographs of raw and carved rhinoceros horn, including approximately 10 different raw rhinoceros horns, were found on Wang’s computer and telephone consistent with a common practice of emailing or texting photographs of items for sale in order to receive instructions on whether to purchase the items and how much to pay. According to prosecutors, Wang had told other dealers that he was seeking raw rhino horns to send to China.
In sentencing Wang , Judge Forrest said that his behavior helped “create and sustain a marketplace for goods made from endangered wildlife.” Judge Forrest also said that Wang’s conduct was “illegal and extremely troubling.”
In addition to the prison term, Judge Forrest ordered Wang, 34, of Flushing, N.Y., to forfeit certain ivory goods in his possession, and banned him from all future trade in elephant ivory and rhino horn. Wang was also sentenced to serve a term of three years of supervised release.
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under United States and international law. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets.
Operation Crash is a continuing investigation being conducted by the Department of the Interior’s Fish and Wildlife Service (FWS), in coordination with other federal and local law enforcement agencies including U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. A “crash” is the term for a herd of rhinoceros. Operation Crash is an ongoing effort to detect, deter and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns.
The investigation by was handled by the U.S. Fish & Wildlife Service, U.S. Attorney’s Office Complex Frauds Unit and the Justice Department’s Environmental Crimes Section, with assistance from the New York State Department of Environmental Conservation . Assistant U.S. Attorney Janis M. Echenberg and Senior Counsel Richard A. Udell of the Justice Department’s Environmental Crimes Section are in charge of the prosecution.
New Jersey Man Charged in Fraud on Family TrustRead the Press Release
Gregory Fresta, 45, of Cherry Hill, NJ, was charged today by Indictment with mail fraud in connection with a scheme to defraud a family trust, announced United States Attorney Zane David Memeger. A $1 million testamentary trust was established in a Will created by Fresta’s father for the benefit of Fresta’s younger brother who was a minor at the time of the father’s death. According to the indictment, Fresta used the United States mail in furtherance of the fraud scheme to send multiple requests for funds from the trust under the guise that the funds were going to be used for the benefit of the trust beneficiary. Upon receiving the money, the defendant used the funds for his own personal use.
If convicted, Fresta faces a maximum possible sentence of 280 years of imprisonment, a fine of $3.5 million, a special assessment of $1,400 and 3 years of supervised release.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Floyd J. Miller.
Click here to view the indictment
An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525New Jersey Gastroenterologist Admits Taking Cash Kickbacks for Patient ReferralsRead the Press Release
NEWARK, N.J. – A physician practicing gastroenterology and internal medicine in West Orange, N.J., pleaded guilty today to receiving cash kickbacks for diagnostic testing referrals, becoming the 13th health care provider and 14th defendant to be convicted in connection with the government’s investigation of illegal payments made by an Orange, N.J., diagnostic testing facility, U.S. Attorney Paul J. Fishman announced.
John Green, M.D., 60, of Basking Ridge, N.J., pleaded guilty before U.S. District Judge Claire C. Cecchi to an information charging him with soliciting and receiving more than $14,000 in illegal cash kickbacks for patient referrals in violation of the federal health care anti-kickback statute.
According to documents filed in this case and statements made in court:
Green was a licensed and board-eligible gastroenterologist who operated his own medical practice in West Orange. From January 2009 through December 2011, Green agreed to take cash payments from Orange Community MRI LLC (“Orange MRI”) in exchange for MRIs and CAT scans he referred to the diagnostic testing facility. During his guilty plea proceeding, Green admitted to receiving cash on a per-patient basis for approximately three years.
Green met with an Orange MRI representative nicknamed “Kenny” on Oct. 6, 2011, and Nov. 10, 2011, at Green’s medical office in West Orange. On each occasion Green received an envelope with more than $800 in cash for referring patients.
The anti-kickback charge carries a maximum potential penalty of five years in prison and a maximum $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for March 25, 2014.In addition to the 14 individuals convicted as a result of the investigation, 11 health care providers, including Green, have agreed to forfeit a total of $353,910 in illegal cash kickbacks. Additionally, Ashokkumar Babaria, 63, of Moorestown, N.J., Orange MRI’s former medical director, agreed to forfeit his revenue from corrupt referrals, which the government estimates is in excess of $2 million. Chirag Patel, 38, of Warren, N.J., Orange MRI’s former executive director, also agreed to forfeit $89,180 in corrupt gains.
U.S. Attorney Fishman credited special agents of the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Tom O’Donnell, who investigated the case with criminal investigators from the U.S. Attorney’s Office.The government is represented by Assistant U.S. Attorneys Scott B. McBride and Deputy Chief Joseph G. Mack of the U.S. Attorney’s Office’s Health Care and Government Fraud Unit in Newark.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $500 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.
13-455
Defense counsel: Kevin A. Buchan Esq. and James A. Plaisted Esq., Roseland, N.J.
Green, John Information
Natrona Convenience Store Owner Charged with Food Stamp FraudRead the Press Release
PITTSBURGH - An individual residing in Allegheny County, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on charges of conspiracy, food stamp fraud, theft of government funds and money laundering, United States Attorney David J. Hickton announced today.
The 12-count indictment named Waqar A. Malik, 56, of Cheswick, Pa., as the sole defendant.
According to the indictment, Malik, the owner of the Natrona Mart in Natrona, Pa., allowed federal Supplemental Nutrition Assistance Program (SNAP) food stamp beneficiaries to purchase non-eligible items such as cigarettes, tobacco products and soap with their EBT benefit card. Because of these transactions, Malik received funds from the United States government to which he was not entitled.
The law provides for a maximum total sentence of not more than 125 years in prison, a fine of $23,250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The U.S. Department of Agriculture-Office of Inspector General, the Internal Revenue Service-Criminal Investigations and the U.S. Department of Homeland Security Investigations conducted the investigation leading to the indictment in this case.
An indictment is an accusation. The defendant is presumed innocent unless and until proven guilty.
Mexican Man Indicted for Attempting to Smuggle Military Type Semi-Automatic Rifles to MexicoRead the Press Release
CORPUS CHRISTI, Texas – Angel Aquino-Pineda, 26, of Tijuana, Mexico, has been charged by a federal grand jury with one count of smuggling firearms from the United States and being a convicted felon in possession of a firearm, announced United States Attorney Kenneth Magidson.
Count one of the indictment charges that on or about Oc. 29, 2013, Pineda did aid, abet and assist another person to fraudulently and knowingly attempt to export 35 AK-47 type 7.62x39 caliber firearms from the United States, knowing them to be intended for Mexico.
He is further charged with possessing those firearms on the same date after he had been previously convicted of a crime, a violation of federal law.
Aquino-Pineda faces up to 10 years in federal prison as well as a possible $250,000 fine, if convicted.
The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the Kingsville Specialized Crimes and Narcotics Task Force. Assistant United States Attorney Hugo R. Martinez is prosecuting the case.
Mexican Illegally Present in United States Sentenced to Time-ServedRead the Press Release
PITTSBURGH - An alien found in Monaca, Pa., has been sentenced in federal court to time served on his conviction of illegal re-entry after deportation, United States Attorney David J. Hickton announced today.
United States District Judge Terrence F. McVerry imposed the sentence on Hugo Silva-Gavina, 37, of Mexico.
According to the information presented to the court, Hugo Silva-Gavina, an alien, was formally removed from the United States by United States Immigration and Customs Enforcement on Jan. 23, 2009. Hugo Silva-Gavina was found to be illegally present in Monaca on Sept. 13, 2013.
Assistant United States Attorney Paul E. Hull prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Department of Homeland Security, Immigration and Custom Enforcement for conducting the investigation leading to the successful prosecution of Silva-Gavina.
Mexican Citizen Sentenced for Illegally Transporting ImmigrantsRead the Press Release
LAKE CHARLES, La.–United States Attorney Stephanie A. Finley announced today that Juan Betancourt-Duran, 30, of Mexico, was sentenced by U.S. District Court Judge Patricia Minaldi, to 12 months in prison for transporting illegal aliens. Betancourt-Duran will be deported after completion of his sentence.
According to evidence presented at the guilty plea, on April 24, 2013, an officer with the Louisiana State Police conducted a vehicle stop on the vehicle Betancourt-Duran was driving because of a traffic violation. The defendant’s vehicle was found to contain nine occupants who could not produce U.S. issued identification. Upon further investigation, it was found that four of the passengers were from Honduras, two from Mexico, two from El Salvador and one from Guatemala. The immigrants told U.S. Border Patrol agents that they paid between $1,200 and $7,000 per person to be smuggled into the United States. Some of the immigrants said they stayed at various residences in separate towns in Texas before being brought to Houston. From there, Betancourt-Duran was to drive them to various cities on the east coast in the United States. Betancourt-Duran admitted that he knew the passengers were illegal aliens. Betancourt-Duran pleaded guilty August 29, 2013.
The U.S. Border Patrol, Homeland Security, and the Louisiana State Police conducted the investigation. Assistant U.S. Attorney James T. McManus prosecuted the case.
Menard County Man Arrested, Charged with Drug and Gun OffensesRead the Press Release
Springfield, Ill. - A Menard county man, Charles Brackhan, 40, of Greenview, Ill., made his initial appearance in federal court this morning following his arrest last night on federal drug and gun charges. Brackhan appeared before U.S. District Sue E. Myerscough, and was ordered to remain in the custody of the U.S. Marshals Service pending a detention hearing scheduled on Dec. 10, 2013. A trial date has been set for February 4, 2014. The four-count indictment against Brackhan was returned by a grand jury last month, but had remained sealed pending Brackhan’s arrest and initial court appearance.
The indictment alleges that on Mar. 19, 2013, Brackhan was manufacturing 50 or more marijuana plants at a home on Sweetwater Avenue in rural Greenview, Ill. Further, the indictment alleges that Brackhan discharged a firearm, a Keltec 9mm handgun, in furtherance of a drug trafficking crime, and that he was a controlled substance user in possession of a handgun.
If convicted, for the offense of manufacture of 50 or more marijuana plants (one count) and for using or maintaining a building for the purpose of manufacturing marijuana (one count), the penalty is up to 20 years in prison. For discharging a firearm in furtherance of a drug trafficking crime, the penalty is a mandatory minimum 10 years in prison and up to life in prison which must be served consecutive to any other penalty. For possession of a firearm by a controlled substance user, the penalty is up to 10 years in prison.
The charges are the result of an ongoing investigation by the Illinois State Police; the Bureau of Alcohol, Tobacco, Firearms and Explosives; and, the Menard County Sheriff’s Office, with the assistance of the Greenview Police Department and the Athens Police Department. Assistant U.S. Attorney Bryan D. Freres is prosecuting the case in the Central District of Illinois, in coordination with the Menard County State’s Attorney’s Office.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
Men Convicted of Conspiring to Obstruct the IRSRead the Press Release
RENO, Nev. – Two men have been convicted by a federal jury in Reno of conspiring to defraud the United States by obstructing the IRS in its assessment and collection of income taxes, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Bret Ogilvie, 50, of Reno, Nev., and Linwood Tracy, 73, of Fallon, Nev., who were indicted in November 2012, were convicted on Wednesday, Dec. 4, 2013, of one count of conspiracy to defraud. Ogilvie was also convicted of one count of corrupt interference with tax administration and five counts of presenting false claims to the IRS. The trial began on Monday, Dec. 2, 2013, and was presided over by U.S. District Judge Larry R. Hicks.
According to the court records, from about Feb. 22 to Nov. 18, 2008, Ogilvie and Tracy conspired to impede and obstruct the IRS in their collection of income taxes by a number of means, including threatening to sue the IRS for $10 million if the IRS did not remove a tax lien on Ogilvie’s residence, by contacting businesses and telling them not to comply with IRS levies against Ogilvie, by setting up a corporation and transferring compensation that Ogilvie earned through his plumbing company to the corporate bank account in an attempt to evade taxes, by threatening to sue employees of the IRS, and by filing a frivolous lawsuit against IRS personnel in Washoe County. Between Dec. 8 and Dec. 10, 2008, and on March 30, 2011, Ogilvie also presented false claims to the IRS for income tax refunds the tax years 2006 through 2010 totaling approximately $3.9 million. Ogilvie made the claims by preparing and causing to be prepared an IRS form indicating he held a Power of Attorney for the Bret Ogilvie Trust.
The defendants face up to five years in prison and a $250,000 fine on the conspiracy charge. Ogilvie also faces up to three years in prison on the interference charge and up to five years in prison on each false claims count, as well as fines of $250,000 on each count. Tracy and Ogilvie are scheduled to be sentenced in Reno on March 3 and March 24, 2013, respectively.
This case was handled in connection with the President's Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys' offices and state and local partners, it's the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
The case was investigated by IRS Criminal Investigation, and is being prosecuted by Assistant U.S. Attorneys Ronald C. Rachow and Michael W. Large.Member of A Pickpocket Crew Sentenced to over 3 Years in PrisonRead the Press Release
Conspirators Targeted Women in Restrooms
Baltimore, Maryland – U.S. District Judge Marvin J. Garbis sentenced Crystal Barner, age 28, of Baltimore, today to 37 months in prison, followed by five years of supervised release, for a scheme in which Barner and her co-conspirators stole wallets from women’s purses, removed the cash, credit cards and driver’s licenses and used the credit cards to make purchases at nearby stores. Judge Garbis gave Barner credit for four months served on a related state court sentence, and ordered Barner to pay restitution of $142,717.61.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Brian Murphy of the United States Secret Service – Baltimore Field Office; Colonel Michael Kundrat, Chief of the Maryland Transportation Authority Police; Chief James W. Johnson of the Baltimore County Police Department; and Commissioner Anthony W. Batts of the Baltimore Police Department.
According to her plea agreement, beginning in May 2007, Barner was part of a scheme to defraud financial institutions by stealing credit cards from the wallets and purses of unsuspecting individuals, then using the stolen credit cards to make purchases. Specifically, the leader of the scheme, Ida Mae Weathers, an experienced pickpocket, would linger in women’s restrooms and steal the wallets from purses hung on the hooks in the stalls. Often, Barner or one of the other co-conspirators would create a distraction in an adjacent stall, such as asking for toilet paper, so that the victim would be looking away from her purse. Barner and other conspirators also sometimes served as a “lookout” for Weathers. Often Weathers was able to remove cash and credit cards and return the wallet to the victim’s purse without the victim seeing or suspecting the theft.Weathers used some of the stolen credit cards herself and provided stolen credit cards to Barner, and other co-conspirators such as, Maureen Brown Little, Nicole Roles, Sharon Curtis and Nefeteria Jamison. The conspirators took the cards to nearby retail stores and used each card until it began to be declined. The conspirators purchased items for their personal use, as well as gift cards or high end merchandise that Weathers would direct them to buy and would then resell. Barner knew that the credit cards were stolen and knew that other members of the conspiracy were conducting fraudulent transactions as well.
During the course of the conspiracy, Barner and others obtained goods, services and extensions of credit in the amount of $142,717.61, and caused losses to or used the identities of between 10 and 50 financial institutions, businesses and individuals.
Ida Mae Weathers, a/k/a Ida Mae Snipes, age 49, of Baltimore, was sentenced to 259 months in prison, for conspiracy, bank fraud and aggravated identity theft, and was ordered to pay restitution of $151,180.50. Co-conspirator Nicole Roles, age 43, was sentenced to 57 months in prison and ordered to pay restitution of $8,462.39. Sharon Curtis, age 32, Maureen Brown Little, age 39, and Nefeteria Jamison, age 32, all of Baltimore, pleaded guilty to their roles in the scheme. Brown-Little and Curtis are both scheduled to be sentenced on March 13, 2014, and Jamison is scheduled to be sentenced on January 29, 2014.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.United States Attorney Rod J. Rosenstein thanked the U.S. Secret Service, Maryland Transportation Authority Police, Baltimore County Police Department, Baltimore City Police Department, and Atlantic City, New Jersey Police Department for their work in the investigation. Mr. Rosenstein praised Assistant U.S. Attorney Tamera L. Fine, who is prosecuting the case.
Manhattan U.S. Attorney Sues Co-Op for Refusing to Allow Disabled Shareholder to Keep an Assistance AnimalRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that the United States has filed a lawsuit against EAST RIVER HOUSING CORP., (“EAST RIVER”), a housing cooperative located at 573 Grand Street in Manhattan, for violating the Fair Housing Act. The Government alleges that EAST RIVER discriminated against a disabled tenant of the cooperative, Stephanie Aaron, by failing to permit a reasonable accommodation of the tenant’s psychiatric disability.
Manhattan U.S. Attorney Preet Bharara said: “The Fair Housing Act plainly allows tenants with disabilities to keep assistance animals, and we will not hesitate to file suit to combat discrimination in this area.”
As alleged in the Complaint filed in Manhattan federal court:
Aaron suffers from chronic major depression, anxiety, and post-traumatic stress disorder. In August 2012, Aaron took in a stray dog, and, within a few days, began to notice improvement in the symptoms of her lifelong mental illness. A few weeks later, EAST RIVER ordered Aaron to remove the dog. Aaron requested that EAST RIVER allow her to keep the dog as a reasonable accommodation of her psychiatric disability, submitting a psychiatrist’s letter in support of her request.
EAST RIVER did not respond to the request for reasonable accommodation and instead gave Aaron a deadline to vacate her apartment. Aaron then submitted another request for reasonable accommodation, again attaching the letter from her psychiatrist. EAST RIVER denied this request. A few days later, Aaron was notified that EAST RIVER had commenced an eviction proceeding against her. Aaron’s attorney then sent a third reasonable accommodation request to EAST RIVER, attaching the psychiatrist’s letter for a third time. Two months later, Aaron’s psychiatrist and psychologist sent additional letters to EAST RIVER. EAST RIVER did not respond to those letters. Instead, it continued the eviction proceeding against Aaron.
Aaron initially filed an administrative complaint with the Department of Housing and Urban Development (“HUD”). Upon investigation, HUD determined that there was reasonable cause to believe that the Fair Housing Act had been violated. Thereafter, EAST RIVER elected pursuant to the Fair Housing Act to have HUD’s determination resolved in federal court.
In these circumstances, the Fair Housing Act authorizes the Department of Justice to commence an action in United States District Court on behalf of Aaron. The Complaint seeks declaratory, injunctive, and monetary relief for Aaron.
Mr. Bharara thanked HUD for its efforts in the investigation.
The case is being handled by the Office’s Civil Rights Unit. Assistant U.S. Attorney Elizabeth M. Tulis is in charge of the case.
U.S. v. East River Housing Corp. Complaint 13 Civ 8650
Manhattan U.S. Attorney and FBI Assistant Director-In-Charge Announce Health Care Fraud Charges Against Current and Former Russian Diplomats and Their SpousesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), today announced charges against 49 defendants for participating in a widespread fraud scheme from 2004 to August 2013 to illegally obtain nearly half a million dollars in Medicaid benefits. Each of the defendants charged in the Complaint unsealed today is a current or former Russian diplomat or the spouse of a diplomat employed at either the Russian Mission to the United Nations (the “Mission”), the Russian Federation Consulate General in New York (the “Consulate”), or the Trade Representation of the Russian Federation in the USA, New York Office (the “Trade Representation”). The Complaint alleges that each of the defendants and their unnamed co-conspirators participated in a widespread scheme to illegally obtain Medicaid benefits for prenatal care and related costs by, among other things, falsely underreporting their income or falsely claiming that their child was a citizen of the United States.
Manhattan U.S. Attorney Preet Bharara said: “Diplomacy should be about extending hands, not picking pockets in the host country. Here, as alleged, a multitude of Russian diplomats and their spouses ran a scam on a health care system designed to help Americans in need. As the Complaint alleges, the scam exploited a weakness in the Medicaid system, and the charges expose shameful and systemic corruption among Russian diplomats in New York.”
FBI Assistant Director-in-Charge George Venizelos said: “The United States Government values its long-standing relationship with foreign diplomats and diplomatic establishments for cooperation on many issues. Unfortunately, as detailed in the complaint, some Russian officials in New York allowed these defendants to take advantage of that relationship. Motivated by greed and the purchase of high-end luxury items, these defendants allegedly perpetrated a fraud to illegally obtain Medicaid benefits to which they were not entitled. The unsealing of the complaint today highlights the criminal activities of these defendants and reminds the public that health care fraud remains an ongoing problem in our country. The FBI and our law enforcement partners, including the New York City Human Resources Administration and the New York State Department of Health, are committed to preventing and prosecuting health care fraud at all levels.”
According to the allegations in the Complaint unsealed today in Manhattan federal court:
Medicaid is a largely federally funded program in the United States designed to assist low-income families afford health care. In New York State, the Department of Health administers the Medicaid program, and the New York City Human Resources Administration oversees the program and processes applications in New York City. In New York State, pregnant women can receive immediate prenatal care following a preliminary assessment of the pregnant woman’s, and, if applicable, her spouse’s, income. If the pregnant woman provides an income level that is higher than the Medicaid eligibility threshold, the provider will generally not process the Medicaid application. Proof of United States citizenship is not required for a pregnant woman to receive Medicaid benefits because the unborn child is presumed to acquire United States citizenship by virtue of being born in the United States. Once completed, the pregnant woman is entitled to Medicaid benefits pursuant to the original application until the 60th post-partum day, and the newborn child is entitled to benefits on the mother’s initial application until the child’s first birthday. Diplomats, their spouses and children are generally not entitled to Medicaid benefits except in cases of emergency.
While in the United States, the individuals employed by the Mission, Consulate, and Trade Representation are paid a salary by the Russian government, which is not subject to United States federal, state, or local taxes. Employees of the Mission and Consulate generally live in housing, the vast majority of which is paid for by the Russian government. The Mission and Consulate historically have also paid for the medical expenses of their employees, including hospital and doctor bills, as well as dental expenses. Each of the defendants named in the Complaint is a Russian diplomat who works or worked at the Mission, Consulate, or Trade Representation, or was married to such an individual. As a result of an international convention among multiple nations and a bilateral agreement between the United States and Russia, children born in the United States to Russian diplomats generally do not acquire United States citizenship.
The investigation revealed the widespread submission of falsified applications for Medicaid benefits associated with medical costs for prenatal care, birth, and young children by the defendants, which enabled the defendants to obtain Medicaid benefits that they were not otherwise entitled to receive. Approximately $1,500,000 in fraudulently received benefits were obtained by the defendants and dozens of other co-conspirators not named in the Complaint. In general, the defendants underreported their income to an amount below or at the applicable Medicaid eligibility level in order to qualify for Medicaid benefits. In support of the underreported income, the defendants generally submitted letters signed by employees of the Mission, Consulate, or Trade Representation, purporting to corroborate that the falsely underreported income was the true income amount. The defendants’ true income was often hundreds, if not thousands, of dollars more per month than what was falsely reported to Medicaid. Moreover, before, during, and after the time that the defendants received Medicaid benefits, several of the defendants opened credit card accounts in which they reflected salaries thousands of dollars higher than they reported to Medicaid.
In addition, one set of defendants failed to disclose their marriage on their initial Medicaid application – falsely claiming that they were brother and sister instead of husband and wife. As a result, those defendants failed to disclose any income the husband earned from the Mission. Because of their lies, they received almost $21,000 in Medicaid income to which they were not entitled. Three other defendants falsely claimed that their children – Russian nationals residing in the United States pursuant to visas issued by the Department of State reflecting their Russian citizenship – were citizens of the United States in order to obtain Medicaid benefits for their children. To support these lies, a United States social security card was provided for one application, and both a United States Social Security Card and a birth certificate issued by the New York City Department of Mental Health and Hygiene was provided in support of another application.
Moreover, before, during, and after the time that the defendants applied for and received hundreds of thousands of dollars in Medicaid benefits, they spent tens of thousands of dollars on luxury items, including cruise vacations and purchases such as watches, shoes, and jewelry, at stores such as Tiffany & Co., Jimmy Choo, Prada, Bloomingdale’s, and Burberry.
For example, TIMUR SALOMATIN, a former diplomat at the Mission, and his wife, NAILYA BABAEVA, applied for Medicaid pregnancy benefits in November 2010 and represented SALOMATIN’s salary to be $3,000 a month, and submitted a renewal application in June 2011 in which they claimed that SALOMATIN made $4,400 a month. In support of both applications, they submitted a letter signed by MIKHAIL KORNEEV, formerly a Counselor at the Mission, in which KORNEEV falsely confirmed the underreported income amount. However, beginning in June 2011, SALOMATIN began to receive direct payroll deposits from the Russian government into his bank account. Between June 2011 and December 2011, SALOMATIN received an average of $5,160 a month – over $2,000 more than he reported to Medicaid on the initial application. In February 2011, shortly after SALOMATIN and BABAEVA applied for Medicaid benefits, and shortly before they applied for renewal benefits, SALOMATIN applied for a credit card and represented his salary to be $8,333 a month. In December 2011, while BABAEVA’s and SALOMATIN’s children continued to receive Medicaid benefits, SALOMATIN represented his salary to be $60,000 a year, or $5,000 a month. During the period between February 2012 and December 2012, while their children continued to receive Medicaid benefits, SALOMATIN and BABAEVA made and paid for over $50,000 in purchases, including over $8,400 from Apple, and over $10,000 from retailers including, among others, Prada and Bloomingdale’s. BABAEVA and her children obtained almost $31,000 in Medicaid benefits to which they were not entitled.
ANDREY ARTASOV and NATALIYA ARTASOVA falsely represented to Medicaid that ARTASOV made only $2,900 a month (or approximately $34,800 a year) in salary in November 2008. In March 2007 – over a year and a half prior to ARTASOVA applying for Medicaid, ARTASOV reported to a credit card company that he made $60,000 a year in salary. In 2008, the year that ARTASOVA received Medicaid benefits, ARTASOV and ARTASOVA made and paid for over $48,000 in purchases on this credit card, spending thousands of dollars at Swarovski and Apple, among other things.
Each of the defendants was charged with one count of conspiracy to commit health care fraud and one count of conspiracy to steal government funds and make false statements relating to health care matters, which carry maximum sentences of ten years and five years in prison, respectively.
Of the 49 defendants, 11 are currently in the United States. Five of those individuals are diplomats working at the Mission. Five of those individuals are the spouses of the diplomats. One is currently employed at the Russian Federation’s embassy in Washington, D.C., but at the time of the charged offenses, was employed at the Consulate. The remaining 38 no longer reside in the United States.
Manhattan U.S. Attorney Bharara praised the investigative work of the FBI, and thanked the New York City Human Resources Administration and the New York State Department of Health for their assistance in this investigation.
The Office’s Public Corruption and Terrorism and International Narcotics Units are handling the case. Assistant U.S. Attorneys Rebecca Ricigliano, Shane Stansbury, and Ian McGinley are in charge of the prosecution.
The charges contained in the Complaint are merely an accusation and the defendants are presumed innocent unless and until proven guilty.
Kuleshov, Mikhail et al. 13 MAG 2711 Complaint
Man Pleads Guilty to Non Payment of Child Support ObligationRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr., announced today that Jonathan Dale, 61, formerly of Clarence, N.Y., pleaded guilty to failure to pay child support before Magistrate Judge H. Kenneth Schroeder. The charge carries a maximum sentence of six months in prison, a $5,000 fine, or both.
Assistant U.S. Attorney Marie P. Grisanti and Maura O’Donnell, who are handling the case, stated that from May of 1999 and continuing through to the present, Dale has failed to pay court ordered child support obligations and arrears totaling approximately $90,000.The conviction is the result of an investigation on the part of Special Agents of the United States Department of Health and Human Services, Office of Inspector General, Office of Investigations, under the direction of Special Agent in Charge Thomas O’Donnell.
Sentencing is scheduled for March 5, 2014, at 10:00 a.m. before Judge Schroeder.Louisville Convicted Felon Sentenced to 25 Years in Prison for Armed Robbery of A Convenience StoreRead the Press Release
– First defendant sentenced in prosecution resulting from "Project Recoil"
LOUISVILLE, Ky. – David J. Hale, United States Attorney for the Western District of Kentucky announced the sentencing today of a Louisville man to 25 years in prison followed by a period of three years supervised release, for the armed robbery of a Louisville convenience store and discharging a firearm during the course of the robbery. The federal prosecution stems from “Project Recoil,” the ongoing partnership of multiple law enforcement agencies, developed by U.S. Attorney Hale, Jefferson County Commonwealth’s Attorney Tom Wine, Jefferson County Attorney Mike O’Connell, LMPD Chief Steve Conrad, ATF Special Agent in Charge Stuart Lowrey, FBI Special Agent in Charge Perrye Turner, and U. S. Marshal James Clark, to maximize penalties for the most violent repeat offenders, and to reduce violent crime in our community.
Since the announcement of Project Recoil, in July 2013, the U.S. Attorney’s Office has brought federal charges against ten defendants connected to the armed robberies of 27 metro Louisville businesses. Numerous additional defendants have been charged in Jefferson Circuit Court.
“Convicted felons who commit violent gun crimes in Jefferson County will face a collaborative and determined law enforcement effort. I’m proud of the efforts of the dedicated police officers, federal agents, state and county prosecutors, and federal prosecutors working together on Project Recoil. Our community benefits from this effective collaboration,” stated U.S. Attorney Hale.
“The partnership of local, state and federal law enforcement through Project Recoil has not only led to ten defendants being indicted in federal court, but to numerous gun and violent crimes being discussed by multiple agencies on a weekly basis. These open lines of communication have led to over a thousand guns being seized in the last year and over one hundred cases involving defendants with serious records and pending gun charges to be discussed, indicted and swiftly prosecuted in state court,” stated Thomas Wine, Commonwealth’s Attorney.
“This conviction sends a very strong message that federal, state and local law enforcement agencies are working together to make Louisville a safer community. Anyone contemplating a gun-related crime should realize the possible consequences,” stated Louisville Metro Police Chief Steve Conrad.
“This conviction and sentence should send a very clear message -- violent gun crimes and the illegal possession, use or trafficking of firearms will not be tolerated. Together, we are aggressively investigating and prosecuting these armed predators to make our community safer,” said ATF Special Agent in Charge Stuart Lowrey.
“Project Recoil is an excellent example of law enforcement’s commitment to cooperation and collaboration, the most effective weapon against crime,” said Perrye K. Turner, Special Agent in Charge of the FBI in Kentucky.
Dorris Trice III, age 32, was sentenced on Thursday by Senior U.S. District Judge Charles R. Simpson III, after pleading guilty to a three-count federal indictment. Trice was previously convicted of state charges in Jefferson Circuit Court, including second degree burglary on October 26, 2000, second degree escape on June 10, 2002, and third degree burglary on October 20, 2010. In U.S. District Court, Trice admitted that on March 3, 2013, he possessed and fired a Charter Arms Undercover.38 Special during the robbery of the Park Food Mart, located at North 19th Street in Louisville. The federal robbery charge was brought pursuant to the Hobbs Act, which criminalizes robberies that affect interstate commerce.
This case was prosecuted by Assistant United States Attorneys Randy Ream and Amanda E. Gregory, and was investigated by the Louisville Metro Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
Last of 24 Arrested in Massive Marijuana Grow House Case Ordered to PrisonRead the Press Release
HOUSTON – Those arrested as a result of the discovery of approximately 14,000 marijuana plants from 43 marijuana grow houses in Harris, Fort Bend and Montgomery Counties in August 2012 have now been ordered to prison, announced United States Attorney Kenneth Magidson along with Javier Peña, special agent in charge, Drug Enforcement Administration (DEA). With the sentencing of Yen Thi Do, 43, formerly of Boston, Mass., today, all those arrested have now been convicted and ordered to prison.
“Today’s sentencing illustrates the seriousness of growing marijuana in Texas,” said Peña. “Whether our investigation leads us to marijuana grow houses operating within city limits or to a country field outside of the city, DEA’s mission is to investigate these illegal operations. The defendants of this organization now recognize DEA does not discriminate on which location you choose. DEA and its law enforcement partners will continue to aggressively and proactively target all areas of drug trafficking.”
Do pleaded guilty to conspiring to maintain a premises for the manufacture, distribution, possession or use of marijuana as did the other 23 defendants involved in the clandestine indoor marijuana grow organization. All of the defendants were born in Vietnam, most of whom were naturalized Canadian, Swedish or U.S. citizens, or permanent U.S. resident aliens. All foreign nationals are subject to deportation upon completing their prison terms.
U.S. District Judge Sim Lake sentenced Do to a total of 57 months in federal prison to be followed by a three-year-term of supervised release. Do was a marijuana grow house tender who left Boston to begin tending the houses in the Houston area.
On Wednesday, Nov. 27, 2013, Judge Lake sentenced the three highest ranking members of the organization charged in this case - Thu Loan Dinh, 36, Van Long Tran, 34, and Thang Van Doan, 36. Each of these three defendants occupied leadership or managerial roles in the organization which generated hundreds of thousands of dollars each quarter with the sale of harvested high potency marijuana. Dinh received a sentence of 108 months, while Tran and Doan will serve respective sentences of 97 and 78 months.
The remaining 20 defendants consisted of either marijuana grow house tenders who were paid to tend and harvest the marijuana plants in their respective grow house, or maintenance men who collected and removed garbage and/or did the lawn care. They received varying sentences up to 56 months in prison.
The investigation focused upon a domestic clandestine hydroponic marijuana cultivation and distribution organization in Harris, Montgomery and Fort Bend Counties. On Aug. 21, 2012, search warrants were executed at more than 60 residences identified during the course of the investigation - 43 marijuana grow houses and 17 residences - leading to the arrest of the 24 people and the seizure of approximately 14,000 marijuana plants, $121,000 in cash, numerous vehicles and hydroponic equipment.Each of the “grow” houses had been leased from unsuspecting homeowners for use as a family residence. With one exception, none of the grow houses were actually occupied, but were used exclusively to grow marijuana. While the exterior and lawns of the leased houses were well maintained to avoid drawing the attention of the homeowners, neighbors or law enforcement, the interiors had been extensively modified to produce a “rapid growth” environment for the marijuana plants. The modified environment permitted the harvesting of 120 – 150 marijuana plants or 12 – 15 pounds of high potency “bud” marijuana every two months once a “grow house” had begun operation.
Arrest warrants remain outstanding for two other suspected leaders/managers - Johnny Ng, 52, and Hein Le, 44. Anyone having information regarding their whereabouts is asked to contact DEA Houston at (713) 693-3000 or their local DEA office.
The investigation was conducted by a DEA-lead Organized Crime Drug Enforcement Task Force investigation dubbed “Operation Green House” which included representatives of sheriff’s offices in Harris, Fort Bend and Montgomery Counties, officers of the Houston Police Department and the Texas Department of Public Safety. Those agencies provided invaluable additional resources and assistance along with the Bureau of Alcohol, Tobacco, Firearms and Explosives, FBI, Homeland Security Investigations, police departments in Katy, Pearland, Willis, Conroe, Huntsville and Pasadena as well as the National Guard Joint Counter Drug Unit and Cypress Creek Emergency Medical Services during the course of the investigation.This case was prosecuted by Assistant United States Attorney (AUSA) Nancy G. Herrera and former AUSA Jesse Rodriguez.
Last Man Sentenced in Attempted Armored Car RobberyRead the Press Release
HOUSTON - James Patrick Campbell, 26, has been ordered to federal prison for conspiracy to interfere with commerce by robbery, announced United States Attorney Kenneth Magidson. Campbell pleaded guilty Oct. 3, 2012, to the conspiracy to rob an armored car operated by Loomis Armored US Inc.
Today, U.S. District Judge Keith P. Ellison handed Campbell a total sentence of 41 months in federal prison.
Also charged in the crime and previously sentenced were Malcolm Jamal Austin, 25, Terrance Saffore, 25, and William Terrell Archer, 22, all of Houston. Saffore was sentenced to 51 months and Archer was sentenced to 63 months. Austin was sentenced to 12 months plus 10 years for discharging a weapon for a total of 132 months.
Campbell admitted he was part of a conspiracy to rob a Loomis armored car as it was about to leave a Bank of America at 12188 Gulf Freeway in Houston on June 22, 2011. Campbell had previously worked for Loomis and provided information regarding driver protocols to the co-conspirators.
On June 22, 2011, Saffore drove Archer and Austin to the bank in a white Grand Prix which was owned by Campbell. Archer went into the bank prior to the robbery. Austin then approached the guard, demanded money and reached for a gun. The guard discharged his weapon and shot Austin three times. Austin also fired, but did not strike the guard. During the robbery, Campbell was waiting around the corner in another vehicle.
Once shots were fired, Archer ran back to Campbell’s nearby apartment. After the failed robbery attempt and shooting, Austin and Saffore fled the scene in Campbell’s vehicle.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.
Judge Throws Out Lawsuit by Cynthia Sommers; Finds the United States Was Not Negligent in Investigation of Her Husband’s Suspicious DeathRead the Press Release
SAN DIEGO, CA – A federal judge today dismissed a lawsuit against the federal government filed by Cynthia Sommer, widow of U.S. Marine Sgt. Todd Sommer, rejecting claims that Naval Criminal Investigative Service agents acted with negligence and malice in the investigation that eventually resulted in her conviction for his murder.
A jury in state court convicted Sommer of first-degree murder in 2007, but the trial judge overturned the verdict, ruling that prosecutors' description of her party "lifestyle" following her husband’s death in 2002 was so inflammatory that it deprived Sommer of a fair trial. In preparation for a retrial, additional tissue samples were tested, and experts found no arsenic. The District Attorney ultimately dismissed the murder case without prejudice.
Sommer filed a lawsuit in federal court in 2009, alleging in part that NCIS agents intentionally inflicted emotional distress upon her and failed to conduct a proper investigation because they disapproved of her partying lifestyle. Sommer also claimed that agents improperly arrested her, withheld key evidence and failed to disclose relevant facts that could have benefitted Sommer’s defense.
In a ruling issued today, U.S. District Judge Cathy Ann Bencivengo rejected all of Sommer’s claims. “The evidence does not support plaintiff’s theory that NCIS agents fabricated evidence or knowingly withheld evidence that they understood to be exculpatory,” the judge wrote in her ruling.
The judge later added: “Plaintiff argues that NCIS agents investigated her because they wanted to punish her for her lifestyle choices. However, because…there is no evidence showing NCIS willfully acted in a wrongful manner (e.g., that it fabricated evidence), Plaintiff’s abuse of process claim fails.”
Judge Bencivengo noted in her ruling that the parties do not dispute the validity of results of the tests conducted by the Armed Forces Institute of Pathology lab (AFIP), which found evidence of arsenic; rather, the plaintiff argued that the federal lab should have performed additional testing to rule out contamination given the extremely high levels of arsenic found.
“The evidence shows they were valid,” the judge wrote, later adding: “There is no actual evidence of contamination that the AFIP disregarded.”
Judge Bencivengo said the scientists in the government lab were well qualified and had the knowledge and experience to test human tissue for trace elements of metals and metalloids, and they followed standard procedures and maintained the chain of custody.
“There is evidence before the Court showing that the AFIP met its standard of care for producing reliable test results...Based on the record before the Court, there is and was no evidence of contamination that the AFIP ignored.”
NCIS agents were involved in the investigation because the death occurred in Navy housing at Marine Corps Air Station Miramar and Sommer was an active-duty Marine.
Indictment Charges New York Man with Threatening Former Business PartnerRead the Press Release
PHILADELPHIA - Roger Eichenholtz, 70, of Westchester County, New York, was charged today by Indictment with one count of threats, announced United States Attorney Zane David Memeger. After losing civil litigation over a business, Eichenholtz sent a numbering of harassing emails to his opponents threatening further litigation. On September 24, 2013, Eichenholtz sent another email threatening civil and criminal litigation. He concluded the email with the following:
PLAN B- if for some unforeseen miracle, you escape justice, I have access to a “Side Bolt 45.cal with 6 silver bullets that have your name on them.”
If convicted, the defendant faces a maximum possible sentence of five years in prison, three years of supervised release, a $250,000 fine, and a $100 special assessment.
The case was investigated by Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael L. Levy.
Click here to view the indictment
An Indictment or Information is an accusation. A defendant is presumed innocent unless and until proven guilty.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Houston Man Sentenced to 87 Months in Prison for Meth Possession and Distribution ChargesRead the Press Release
LAKE CHARLES, La. –United States Attorney Stephanie A. Finley announced today that Ricky Martinez, 44, of Houston, was sentenced by U.S. District Judge Patricia Minaldi, to 87 months in prison and three years of supervised release for possession of methamphetamine with intent to distribute. Martinez pleaded guilty August 7, 2013.
According to evidence presented at the guilty plea, a Calcasieu Parish Sheriff’s deputy stopped the defendant on February 13, 2012, for speeding north of Lake Charles. The deputy asked Martinez to step out of the vehicle and saw that he had an open beer container. After the deputy conducted a safety pat-down, $10,540 was found in Martinez’s pants pocket. During a search of the vehicle, the deputy found 10 plastic baggies containing more than 265 grams of methamphetamine, a baggie containing a cutting agent, and a digital scale. Martinez admitted at the guilty plea hearing that he intended to deliver the methamphetamine to other people.
Anthony Frederick “Tony” Giaimis, 49, of Westlake, La., and Justin W. Brewer, 42, of Houston, were also charged in the same indictment with Martinez in August 2012.
A jury found Giaimis guilty on April 10, 2013, of conspiring to distribute more than 50 grams of methamphetamine, possession of more than five grams of pure methamphetamine and felony weapon possession. Giamis was sentenced on August 1, 2013, to 262 months in prison and six years of supervised release. Brewer was sentenced on July 25, 2013, to 60 months in prison and five years of supervised release for possession with intent to distribute more than 50 grams of methamphetamine. He pleaded guilty on April 8, 2013.
“Methamphetamine is a harmful and destructive drug,” Finely stated. “Our office, along with our federal, state and local partners will continue to do everything in our power to keep these drugs out of our communities.”
The Westlake Police Department, Calcasieu Parish Sheriff’s Office, Lake Charles Police Department, FBI Safe Streets Task Force, Combined Anti-drug Team (CAT) Task Force, and the Drug Enforcement Administration Southwest Regional Laboratory conducted the investigation. Assistant U.S. Attorney Joseph T. Mickel prosecuted the case.
Houston Man Admits to $350,000 Auto Loan SchemeRead the Press Release
In San Antonio, 48-year-old Pierre Koutani of Houston, TX, faces up to five years in federal prison after pleading guilty this afternoon to making a false statement to a financial institution in relation to a $350,000 auto loan scheme announced United States Attorney Robert Pitman and FBI Special Agent In Charge Armando Fernandez, San Antonio Division.
By pleading guilty, Koutani admitted that in July 2010, he obtained nine car loans totaling $350,368 utilizing false and fraudulent employment information. According to court records, Koutani falsely claimed he had been a long-time account manager for a Houston-based mortgage company earning between $11,000 and $12,000 a month. Koutani sold many of the vehicles he obtained loans for to unsuspecting purchasers without disclosing the bank liens. Koutani defaulted on all but one of the loans.
Koutani remains on bond pending sentencing which is scheduled for March 5, 2014, before United States District Judge Xavier Rodriguez.
This investigation was conducted by agents with the Federal Bureau of Investigation. Assistant United States Attorney Tom Moore prosecuted this case on behalf of the Government.
Government Files Suit Against Canton, Ohio-based Tab Construction and Its Owner for Allegedly Defrauding the Historically Underutilized Business Zone ProgramRead the Press Release
The government has filed a complaint against Canton, Ohio-based TAB Construction Co. Inc. (TAB) and its owner, William E. Richardson III, for allegedly making false statements to the Small Business Administration (SBA) to obtain certification as a Historically Underutilized Business Zone (HUBZone) company, the Justice Department announced today.
“The HUBZone program is intended to create jobs in areas that historically have had trouble attracting business,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “The Justice Department will take strong enforcement action when companies obtain contracts to which they are not entitled.”
The government alleges that TAB used its fraudulently procured HUBZone certification to obtain four U.S. Army Corps of Engineers’ construction contracts worth millions of dollars. Each of those contracts had been set aside for qualified HUBZone companies. The government’s complaint asserts claims against TAB and Richardson under the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act of 1989.
Allegedly, Richardson originally applied to the HUBZone program in 2000 by claiming that TAB’s principal office was located in a designated HUBZone when no TAB employees worked out of the HUBZone office, and TAB actually was located in a non-HUBZone. Even though Richardson told the SBA that TAB was located in a HUBZone, Richardson consistently used his non-HUBZone address in conducting TAB’s other business affairs, at one point even stating under oath in private litigation that TAB’s office was located in a non-HUBZone. In 2006, Richardson allegedly applied for re-certification to the HUBZone program, again falsely stating that eight employees worked in the designated HUBZone. The government alleges that just six weeks after Richardson re-certified its eligibility with the SBA, TAB completed an affidavit in an unrelated matter, which stated that TAB’s principal office was located in a non-HUBZone.
Under the HUBZone program, companies that maintain their principal office in a designated HUBZone, and meet certain other requirements, can apply to the SBA for certification as a HUBZone small business company. HUBZone companies can then use this certification when bidding on government contracts. In certain cases, government agencies will restrict competition for a contract to HUBZone-certified companies.
“We will not tolerate fraud in the HUBZone or any other SBA program,” said SBA Inspector General Peggy E. Gustafson. “With our interagency partners, this office will continue to pursue those who defraud the government by lying to gain access to federal set-aside contracts.”
“SBA’s contracting programs, including the HUBZone program, provide small businesses with the opportunity to grow and create jobs,” said SBA General Counsel Sara D. Lipscomb. “SBA has no tolerance for waste, fraud or abuse in any government contracting program and is committed to working with our federal partners to ensure the benefits of these programs flow to the intended recipients.”
The government filed its complaint in two consolidated lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act. Under the Act, a private citizen can sue on behalf of the government and share in any recovery. The government also is entitled to intervene in the lawsuit, as it has done in this case.
This matter was handled by the Commercial Litigation Branch of the Justice Department’s Civil Division in conjunction with the Small Business Administration’s Office of Inspector General and Office of General Counsel and the Defense Criminal Investigative Service.
The consolidated civil cases are U.S. ex rel. Roy. J. Fairbrother Jr. and Louis Petit v. TAB Construction Co. Inc., et al., No. 5:11-cv-1432 (N.D. Ohio) and U.S. ex rel. Patricia Hopson and Vince Pavkov v. TAB Construction Co. Inc., No. 5:12-cv-135 (N.D. Ohio). The claims asserted against TAB and Richardson are allegations only, and there has been no determination of liability.
Gladstone Man Pleads Guilty to his Role in Computer Hacking, ID Theft SchemeRead the Press Release
KANSAS CITY, Mo. - Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that the fifth and final defendant pleaded guilty in federal court today to his role in a $725,000 fraud scheme that involved hacking into business computer systems to steal the identity information of hundreds of their customers.
Vince Evola, 45, of Gladstone, Mo., pleaded guilty before U.S. Chief District Judge Fernando J. Gaitan to conspiracy to commit mail fraud.
By pleading guilty today, Evola admitted that he participated in a computer hacking and identity theft scheme with his ex-wife, Kimberly Evola, 45, of Gladstone, his sisters, Carrie Evola, 46, of Gladstone and Rosemary Evola, 42, of Overland Park, Kan., and Sael Mustafa, 35, a citizen of Jordan who resided in Gladstone.
The three-year-long scheme, which began in 2006, was designed to obtain stolen credit and debit card numbers from hundreds of victims and use that information to make online purchases. Vince Evola acknowledged in today’s plea agreement that a loss between $30,000 and $70,000 can be attributed to his conduct.
All of Vince Evola’s co-defendants already have pleaded guilty and been sentenced. Mustafa, the leader of the scheme, was sentenced on July 8, 2011, to 10 years in federal prison without parole and ordered to pay restitution to his victims. Mustafa committed a substantial part of the fraud scheme outside the United States. Before moving to Gladstone, Mustafa used the wireless network at an Internet café in Jordan to hack into company Web sites, as well as to use the stolen identity information to access online credit card accounts and to conduct fraudulent transactions. He moved from Jordan to Gladstone in January 2009 and continued to operate the scheme until April 2009.
Court documents describe the computer hacking, identity theft and fraud scheme as follows:
Step One: The Computer Hack
Mustafa accessed the computer servers that hosted the Web sites of several businesses to access customer databases and download the customers= personal information. Mustafa exploited these businesses for presumably less secure information, such as e-mail addresses, Web site passwords and security questions. This information was usually provided to the business by a customer registering on the Web site for online services such as a company newsletter, making a reservation, buying a gift card, or receiving e-mail coupons.
Step Two: Accessing Credit Card Accounts
Mustafa and his co-conspirators then tried to use this stolen customer information at major credit card Web sites. Mustafa counted on the likelihood that many identity theft victims used the same password for the hacked accounts that they used for their online credit card accounts. Mustafa visited various credit card Web sites and, by trial and error, tested the stolen identity information to see if it matched the login and password information for their credit card account. If a victim had an account at a particular credit card Web site, and if the victim used the same login and password information, Mustafa was able to access their accounts.
Step Three: Using the Victims’ Accounts
After gaining access to victims' credit card accounts, conspirators purchased more than $240,000 worth of airline tickets (both domestic and international) and more than $30,000 in gift cards online. They also sent, or attempted to send, more than $344,000 in wire transfers and conducted more than $106,000 in other fraudulent online transactions (such as a subscription to the Al-Jazeera Channel). They purchased gift cards or made purchases online from businesses such as Hy-Vee, Nebraska Furniture Mart, AMC Theaters, Bass Pro Shop, Hallmark, Liz Claiborne, Lowes, Red Lobster, Olive Garden, PF Chang’s, and Zales, among others. They directed the products to be mailed to their residences.
Under federal statutes, Evola is subject to a sentence of up to 20 years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Matthew P. Wolesky. It was investigated by the U.S. Postal Inspection Service and the Gladstone, Mo., Police Department.Georgia Man Pleads to Guilty Trafficking ChargesRead the Press Release
ROCHESTER, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Liddon Young, 32, of Stone Mountain, Georgia, pleaded guilty today before U.S. District Judge Frank P. Geraci, Jr. to conspiracy to unlawfully deal firearms without a federal firearms license and unlawfully dealing in firearms without a license, as well as selling firearms to a convicted felon. The charges carry a maximum sentence of 20 years in prison, a fine of $750,000 fine or both.
Assistant U.S. Attorney Robert A. Marangola, who is handling the case, stated that between August 2012 and February 6, 2013, Young conspired with Paul Davis to unlawfully traffic firearms from the Atlanta, Georgia area to Rochester. Young sold multiple firearms and rounds of ammunition to Davis in the Atlanta area which were then transported by Davis and others for illegal resale on the black market in Rochester. Young delivered 11 firearms to Davis on February 6, 2013 in Rochester as part of the conspiracy. Davis and others deposited money into a bank account in Young’s name as payment for the illegal firearms business.
“This is yet another positive development in our continuing fight against violent gun crime,” said U.S. Attorney Hochul. “Today, a person who brought numerous illegal firearms to Rochester stands convicted in Federal Court and faces a lengthy term in prison. Yesterday’s Federal Court jury conviction of three men who used firearms to murder three persons in Greece means that each will likely spend the rest of their lives in jail. As these cases demonstrate, law enforcement will not rest until all violent criminal operations are brought to justice.”
Sentencing is scheduled for March 3, 2014 at 3:30 pm. before Judge Geraci.
Paul Davis was arrested February 6, 2013 after selling a Georgia pistol to a confidential informant. Multiple federal search warrants executed resulted in the seizure of 10 additional firearms and hundreds of rounds of ammunition. Liddon Young was arrested in Rochester on February 8, 2013 in possession of a loaded .380 caliber pistol. Davis was convicted on gun charges in April 2012 and is awaiting sentencing.
The plea is the culmination of an investigation on the part of on the part of Special Agents of the Bureau of Alcohol Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Joseph Anarumo and the Rochester Police Department, under the direction of Chief James Sheppard.Four More Defendants Plead Guilty in Manhattan Federal Court for Their Roles in Two International SportsbooksRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that NOAH SIEGEL pled guilty today in Manhattan federal court to transmission of wagering information in interstate commerce. His co-defendants MOSHE ORATZ and JONATHAN HIRSCH pled guilty to the same offense earlier this week on December 3 and 4, 2013, respectively. An additional co-defendant, MICHAEL SALL, also pled guilty on December 4, 2013, to interstate travel in aid of an unlawful activity – illegal gambling. SIEGEL, ORATZ, HIRSCH, and SALL were charged in April 2013 along with 30 other alleged members and associates of two Russian-American organized crime enterprises in an indictment that included racketeering, money laundering, extortion, and various gambling offenses. All four defendants pled guilty before U.S. District Judge Jesse M. Furman.
Manhattan U.S. Attorney Preet Bharara said: “Noah Siegel, Moshe Oratz, Jonathan Hirsch, and Michael Sall are the latest defendants convicted for their roles in this highly lucrative, underground gambling operation. Their guilty pleas bring us ever closer to bringing each and every person involved to justice.”
According to the Indictment, other documents filed in Manhattan federal court and statements made at various proceedings in this case, including today’s guilty plea:
Illya Trincher and Hillel Nahmad, SIEGEL, ORATZ, and HIRSCH’s co-defendants, ran a high-stakes illegal gambling business that catered primarily to millionaire and billionaire clients. Their business utilized several online gambling websites that operated illegally in the United States to generate tens of millions of dollars of sports bets each year. SIEGEL was a partner of Trincher and Nahmad in their sportsbook and helped select wagers and handicap bets. ORATZ assisted Trincher and Nahmad’s sportsbook by providing them with accounts at illegal online betting websites, and HIRSCH worked for Trincher and Nahmad’s sportsbook as an accountant and bookkeeper.
The Taiwanchik-Trincher Organization, operated by Anatoly Golubchik and Vadim Trincher, is a nationwide criminal enterprise with strong ties to Russia and Ukraine. The leadership of the organization ran an international sportsbook that catered primarily to Russian oligarchs living in Russia and Ukraine and throughout the world. The Taiwanchik-Trincher Organization laundered tens of millions of dollars in proceeds from the gambling operation from Russia and the Ukraine through shell companies and bank accounts in Cyprus, and from Cyprus into the United States. Once the money arrived in the United States, it was either laundered through additional shell companies or invested in seemingly legitimate investments, such as hedge funds or real estate. SALL helped Golubchik and Trincher invest the proceeds of their illegal international gambling activities into various domestic investments.
SIEGEL, 31, of New York, New York, faces a maximum of two years in prison and one year of supervised release. As part of his plea agreement, SIEGEL agreed to forfeit $400,000. He is scheduled to be sentenced by Judge Furman on April 10, 2013 at 3:45 p.m.
ORATZ, 38, of Brooklyn, New York, faces a maximum of two years in prison and one year of supervised release. As part of his plea agreement, ORATZ, agreed to forfeit $325,000. He is scheduled to be sentenced by Judge Furman on April 8, 2014 at 3:00 p.m.
HIRSCH, 30, of New York, New York, faces a maximum of two years in prison and one year of supervised release. As part of his plea agreement, HIRSCH agreed to forfeit $80,600. He is scheduled to be sentenced by Judge Furman on April 10, 2013 at 3:00 p.m.
SALL, 68, of Sunny Isles Beach, Florida, faces a maximum of five years in prison and three years of supervised release. As part of his plea agreement, SALL agreed to forfeit $1,300,000. He is scheduled to be sentenced by Judge Furman on April 9, 2014 at 3:00 p.m.
ORATZ, HIRSCH, SIEGEL, and SALL are the 20th, 21st, 22nd, and 23rd defendants in this case to plead guilty. The defendants who have pled to date have agreed to forfeit, in total, more than $68,000,000.00. The following defendants previously pled guilty and have been or await sentencing:
- Bryan Zuriff pled guilty to gambling charges on July 26, 2013 and was sentenced on November 25, 2013;
- William Barbalat pled guilty to gambling charges on August 14, 2013;
- Kirill Rapoport pled guilty to gambling charges on August 16, 2013;
- Edwin Ting and Justin Smith pled guilty to gambling charges on September 4, 2013;
- Dmitry Druzhinsky and David Aaron pled guilty to gambling charges on October 4, 2013;
- Alexander Zaverukha pled guilty to gambling charges on October 10, 2013;
- Nicholas Hirsch pled guilty to conspiring to commit wire fraud on October 16, 2013;
- Anatoly Shteyngrob pled guilty to conspiring to commit money laundering on October 17, 2013;
- Yugeshwar Rajkumar pled guilty to gambling charges on October 18, 2013;
- Stan Greenberg pled guilty to conspiring to commit racketeering on October 22, 2013;
- Arthur Azen pled guilty to conspiring to commit money laundering and conspiring to collect extensions of credit by extortionate means on November 5, 2013;
- Hillel Nahmad pled guilty to gambling charges on November 12, 2013;
- Vadim Trincher pled guilty to conspiring to commit racketeering on November 14, 2013;
- Eugene Trincher pled guilty to gambling charges on November 14, 2013;
- Anatoly Golubchik pled guilty to conspiring to commit racketeering on November 15, 2013;
- Illya Trincher pled guilty to gambling charges on November 15, 2013; and
- Ronald Uy pled guilty to structuring financial transactions on November 25, 2013.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation, the New York City Police Department, and the Internal Revenue Service.
The case is being prosecuted by the Office’s Organized Crime Unit. Assistant U.S. Attorneys Harris M. Fischman, Joshua A. Naftalis, Peter Skinner, and Kristy J. Greenberg of the Organized Crime Unit are in charge of the prosecution. Assistant U.S. Attorneys Alexander Wilson and Christine Magdo of the Office’s Asset Forfeiture Unit are responsible for the forfeiture aspects of the case.
U.S. v. Alimzhan Tokhtakhounov, et al. Indictment
Four Gang Members Arrested in Gonzales on Federal ChargesRead the Press Release
Today, federal and local authorities arrested four gang members in Gonzales, TX, based on grand jury indictments returned on Wednesday alleging federal drug and firearms violations announced United States Attorney Robert Pitman, ATF Special Agent in Charge Robert Elder, Houston Division, and Gonzales Police Chief Tim Crow.
Those arrested based on federal grand jury indictments unsealed today include:
- 28-year-old Randon Romero, believed to be affiliated with the Texas Mexican Mafia, charged with one count each of felon in possession of a firearm or ammunition, carrying firearms during and in relation to a drug trafficking crime, and possession with intent to distribute methamphetamine;
- 33-year-old Tyrone Stovall, believed to be a member of the Bloods gang, charged with one count each of felon in possession of a firearm or ammunition, carrying firearms during and in relation to a drug trafficking crime, and possession with intent to distribute crack cocaine;
- 33-year-old Mario Banda, believed to be a member of the Texas Syndicate, charged with one count of possession with intent to distribute methamphetamine; and,
- 28-year-old Roman Gabriel Luna, believed to be a member of the Texas Syndicate, charged with one count each of felon in possession of a firearm or ammunition and possession with intent to distribute methamphetamine.
“One of the best ways that federal authorities can effectively partner with local law enforcement is to use our resources to help remove violent and repeat offenders from the community for longer periods of time,” stated United States Attorney Robert Pitman.
Upon conviction, felon in possession of a firearm or ammunition calls for a maximum ten years imprisonment; carrying a firearm during a drug trafficking crime, a mandatory consecutive minimum of five years imprisonment; and, possession with intent to distribute a controlled substance, up to 20 years imprisonment.
All four defendants are scheduled to make their Initial Appearances at 3:00pm today before United States Magistrate Judge Henry J. Bemporad in San Antonio.
These charges resulted from an investigation conducted by the agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) together with investigators from the Gonzales Police Department. Assistant United States Attorney Sarah Wannarka is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Founder of Investment Company Sentenced in $21 Million Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that James C. Howard, III, 54, of Parkland, FL, the founder of Commodities Online LLC (COL), was sentenced on December 3, 2014 for his participation in a $21 million investment fraud scheme.
U.S. District Judge Joan Lenard sentenced Howard to 189 months in prison, followed by three years of supervised release. The Court also ordered a forfeiture judgment of $21,631,466. The Court will also order restitution to be paid to the victims. The restitution hearing is set for February 24, 2014.
Howard pled guilty on September 16, 2013 to one count of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349. According to court documents, Howard conspired with co-defendants Patricia S. Saa, Louis N. Gallo, III, and Michael R. Casey to defraud individuals who invested in COL. From approximately January 2010 through April 2011, Howard and his co-conspirators used material false and fraudulent representations and material omissions to obtain over $21 million from over 700 investors.
According to court documents, Howard and his co-conspirators used COL to sell COL ownership units, subscriptions to the COL website, and investments in purported transactions to buy and sell commodities. After receiving the funds for the COL ownership units, Howard and Saa diverted a large part of those funds for other purposes. In addition to selling COL ownership units, Howard and his co-conspirators caused certain purported “pre-sold” commodities contracts to be offered for investment via the COL website, stating a pre-determined percentage return on investment and the number of days by when investors would be paid. Howard and his co-conspirators also represented to investors that COL had a track record of profits. However, COL did not have profits. Any payments made to investors were made using funds received from newer investors.
Also according to court documents, Howard and his co-conspirators made material misrepresentations and omissions about the leaders of COL. After mid-2010, Howard and his co-conspirators represented that Howard was no longer President of COL and that co-defendant Casey, an attorney, was the President of COL. Howard and his co-conspirators represented that Howard was no longer managing COL, when in fact, Howard remained in charge. Also, Howard and his co-conspirators did not disclose to investors that both Howard and co-defendant Gallo had previously been convicted of federal felonies and that Gallo was still serving a term of supervised release.
The trial of Howard’s codefendants, Casey, Gallo, and Rita Balbirer who were charged in the same indictment is scheduled for March 10, 2014. Balbirer was charged with money laundering.
In addition to codefendants charged in the same indictment with Howard, other participants in the investment fraud conspiracy related to COL have been charged in separate Informations: Timothy B. Josselson, the Chief Operating Officer, Kathryn A. Josselson, the Comptroller, and Robert S. Lananna, the Director of Sales. Timothy Josselson pled guilty November 22, 2013. His sentencing is scheduled for January 30, 2014. Kathryn Josselson pled guilty November 14, 2013. Her sentencing is scheduled for January 23, 2014. Robert Lananna pled guilty November 14, 2013. His sentencing is scheduled for January 31, 2014.
Mr. Ferrer commended the investigative efforts of the FBI and the cooperative efforts of the Miami Regional Office of the U.S. Securities and Exchange Commission. This case is being prosecuted by Assistant U.S. Attorney Ana Maria Martinez.
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.
Former State Senator Sentenced for Wire FraudRead the Press Release
United States Attorney Deborah R. Gilg announced that Brenda Council, 60, was sentenced in the United States District Court in Omaha for the felony offense of wire fraud. The Honorable Lyle E. Strom, Senior United States District Court Judge, sentenced Council to a 3 year term of probation and imposed a $500 fine. No restitution was ordered as the funds have been repaid.
Council, while a Nebraska State Senator, used campaign funds to place wagers at casinos in Kansas, Missouri and Oklahoma. Council solicited campaign contributions from individuals and businesses to fund her race to win reelection to the Nebraska Unicameral. She misappropriated approximately $63,000 of campaign funds and used the monies for gambling between January of 2010 and July of 2012.
Periodic campaign statements accounting for contributions and expenses were filed with the Nebraska Accountability and Disclosure Commission. Many of the filings Council submitted were false as they failed to account for the conversion of campaign funds to finance her gambling. Withdrawals from her election campaign account were frequently made by use of an ATM machine inside the casinos in Kansas, Missouri and Oklahoma.United States Attorney Deborah R. Gilg stated “this felony conviction addresses the breach of trust the public places in its elected officials. This conviction serves as a notice to other public officials that there are severe consequences for violating the public trust. This felony conviction involves the loss of a license to practice law, the forfeiture of the right to hold elected office and to vote.”
Former Narcotics Task Force Officer Sentenced to A Year in Prison for Embezzling Seized MoneyRead the Press Release
BIRMINGHAM – A federal judge today sentenced the former commander of the West Alabama Narcotics Task Force to one year and a day in prison for stealing at least $125,000 from suspected drug proceeds seized by the multi-agency task force, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JEFFREY LYNN SNYDER, 55, of Carrollton, pleaded guilty in June to one count of theft from a program that received more than $10,000 in federal benefits within a one-year period. U.S. District Court Judge Inge P. Johnson sentenced Snyder to prison and, in accordance with the plea agreement he entered with the government in May, ordered him to pay $125,000 restitution to the West Alabama Narcotics Task Force.
The U.S. Attorney's Office charged Snyder in May with embezzling the task force money between June 2010 and June 2012, when he left the task force.
"Joint task force operations are an important part of the combined law enforcement effort to control illegal drug trafficking. This theft by a city police captain impaired the financial condition of the unit and violated the trust placed in him by fellow officers," Vance said. "Police officers who violate their oath to protect and serve the public are rare, but those who breach that trust must be prosecuted and held to account."
"Honesty and integrity are fundamental guiding principles for any law enforcement officer, regardless of rank or position," Schwein said. "Fortunately, Mr. Snyder's actions are not reflective of the vast majority of the men and women in law enforcement who go to work every day to protect and serve while upholding the principles of honesty and integrity. Today, Mr. Snyder pays the price for his actions and is being held accountable for violating the trust the good people of West Alabama placed in him."
The West Alabama Narcotics Task Force is composed of officers from the Tuscaloosa Police Department, Tuscaloosa County Sheriff's Office, Northport Police Department and University of Alabama Police Department. It is tasked to investigate all drug crimes in Tuscaloosa County.Snyder was a 29-year member of the Tuscaloosa Police Department, retiring as a captain in December 2012. He was detailed to the narcotics task force in 1989 and became its commander in June 2002, according to court records.
Task force members periodically seized money suspected to be proceeds of illegal drug transactions and turned the money in to Snyder, who was responsible for depositing the money into bank accounts while condemnation proceedings were pursued through court, according to his plea agreement. Snyder was entrusted to receive the seized money, log it in task force ledger books and deposit it in task force bank accounts.
Snyder began embezzling from the seized funds no later than June 2010. He executed his scheme "by pocketing some or all of the funds seized during various arrests, and then failing to correctly account for those funds," he acknowledged in his plea agreement.
The FBI investigated the case, with assistance from the West Alabama Narcotics Task Force. Assistant U.S. Attorney Henry Cornelius prosecuted the case.
Former Narcotics Task Force Officer Sentenced to A Year in Prison for Embezzling Seized MoneyRead the Press Release
BIRMINGHAM – A federal judge today sentenced the former commander of the West Alabama Narcotics Task Force to one year and a day in prison for stealing at least $125,000 from suspected drug proceeds seized by the multi-agency task force, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.
JEFFREY LYNN SNYDER, 55, of Carrollton, pleaded guilty in June to one count of theft from a program that received more than $10,000 in federal benefits within a one-year period. U.S. District Court Judge Inge P. Johnson sentenced Snyder to prison and, in accordance with the plea agreement he entered with the government in May, ordered him to pay $125,000 restitution to the West Alabama Narcotics Task Force.
The U.S. Attorney's Office charged Snyder in May with embezzling the task force money between June 2010 and June 2012, when he left the task force.
"Joint task force operations are an important part of the combined law enforcement effort to control illegal drug trafficking. This theft by a city police captain impaired the financial condition of the unit and violated the trust placed in him by fellow officers," Vance said. "Police officers who violate their oath to protect and serve the public are rare, but those who breach that trust must be prosecuted and held to account."
"Honesty and integrity are fundamental guiding principles for any law enforcement officer, regardless of rank or position," Schwein said. "Fortunately, Mr. Snyder's actions are not reflective of the vast majority of the men and women in law enforcement who go to work every day to protect and serve while upholding the principles of honesty and integrity. Today, Mr. Snyder pays the price for his actions and is being held accountable for violating the trust the good people of West Alabama placed in him."
The West Alabama Narcotics Task Force is composed of officers from the Tuscaloosa Police Department, Tuscaloosa County Sheriff's Office, Northport Police Department and University of Alabama Police Department. It is tasked to investigate all drug crimes in Tuscaloosa County.Snyder was a 29-year member of the Tuscaloosa Police Department, retiring as a captain in December 2012. He was detailed to the narcotics task force in 1989 and became its commander in June 2002, according to court records.
Task force members periodically seized money suspected to be proceeds of illegal drug transactions and turned the money in to Snyder, who was responsible for depositing the money into bank accounts while condemnation proceedings were pursued through court, according to his plea agreement. Snyder was entrusted to receive the seized money, log it in task force ledger books and deposit it in task force bank accounts.
Snyder began embezzling from the seized funds no later than June 2010. He executed his scheme "by pocketing some or all of the funds seized during various arrests, and then failing to correctly account for those funds," he acknowledged in his plea agreement.
The FBI investigated the case, with assistance from the West Alabama Narcotics Task Force. Assistant U.S. Attorney Henry Cornelius prosecuted the case.
For Second Time in Federal Court, Long Beach Man Guilty of Transporting Women Across State Lines to Work as ProstitutesRead the Press Release
SANTA ANA, California – A Long Beach man with a long history of forcing women into the sex trade pleaded guilty this morning in a sex trafficking case and is expected to be sent to prison for another decade.
William Earl Flavors, also known as “Andre,” 40, who formerly resided in Seattle, pleaded guilty this morning to a charge of transportation into prostitution.
Flavors pleaded guilty before United States District Judge Josephine L. Staton, who scheduled a sentencing hearing for May 9. While Judge Staton will make the final decision, prosecutors and Flavors agree that the appropriate sentence in this case is the statutory maximum sentence of 10 years in federal prison. The 10-year sentence is much longer than the sentence that would be expected for this crime under the United States Sentencing Guidelines, and this 10-year sentence would run consecutive to a four-year sentence he is currently serving in relation to the same conduct.
In court this morning, Flavors admitted that he transported two victims in 2012 from Long Beach to Las Vegas, where they were forced or coerced to work as prostitutes. Flavors also admitted he used coercion and force – including physical abuse and threats of additional physical abuse – to make one of the victims work for him as a prostitute for an eight-month period in 2012.
In a previous case, Flavors was prosecuted by the United States Attorney’s Office and received a 14-year prison sentence in May 2000. In that case, Flavors admitted transporting two teen age girls from Washington and forcing them to work as prostitutes in Orange County.
Flavors completed his sentence in late 2011 and was on supervised release until October 2012, when he was arrested by Long Beach police after a woman reported being attacked by Flavors. Flavors pleaded guilty in state court last year to pimping in relation to his activities in 2012, and he was sentenced to four years in state prison.
Earlier this year, United States District Judge Cormac J. Carney found Flavors to be in violation of his supervised release in the prior federal court case. Judge Carney revoked his supervised release and sentenced Flavors to a four-year prison term, which he is currently serving.
The sentencing that Flavors will receive from Judge Staton in relation to today’s guilty plea will run consecutive to the sentence that he is currently serving.
The current case against Flavors was investigated by the Federal Bureau of Investigation and the Long Beach Police Department.
Release No. 13-138
Final Defendant Sentenced for Food Stamp Fraud Schemes in Wilkinson CountyRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announces that Lashaundra Evans, 32 of Wilkinson County, Georgia, was sentenced on Tuesday, December 3, 2013, by the Honorable Marc T. Treadwell, United States District Judge, in Macon, Georgia, to serve twelve (12) months and one (1) day imprisonment and to pay $14,460.00 in restitution to the U.S. Department of Agriculture, as the result of her plea of guilty on July 29, 2013, to federal charges of one count of food stamp fraud.Ms. Evans was part of a food stamp fraud scheme involving Elbert Eugene Shinholster, 77, also of Wilkinson County, who was sentenced on October 18, 2013 to serve forty (40) months in prison and to pay restitution in the amount of $4,680,557.20 for food stamp fraud and money laundering. Mr. Shinholster was the owner and operator of Shinholster’s Grocery and Meat Market located in Irwinton, Georgia. He illegally conspired with almost 2,000 food stamp recipients to defraud the food stamp program. As part of the scheme each food stamp recipient would provide Mr. Shinholster with an electronic benefits transfer (EBT) card and personal identification number. Mr. Shinholster would then run the EBT card through the point of sale machine administered by the Food Stamp Program as though the cardholder had purchased food when, in fact, the cardholder got cash instead. Mr. Shinholster admitted that he knew that an EBT card was to be used to purchase food only and not to be sold for cash. The illegal EBT debit would include an additional thirty (30) per cent of the cash amount as profit for Mr. Shinholster.
In addition to Lashaundra Evans, fifteen other defendants from Wilkinson County pled guilty to participating with Mr. Shinholster in the food stamp fraud and have been sentenced: Tracey McDowell, Kristi Northern, Keisha Robinson, Sheena Sanders, Krystal Allen, Angelina Curry, Brandy Day, Cassandra Harris, Willie Harris, Jazmin Hunter, Janine Jackson, Shanirah Jackson, Shamirah Jackson, Karrie Jackson and Pamela Johnson.
“Ms. Evans took advantage of a worthwhile system that was set up to help people who need a hand, just like her and her children. What is unfortunate about these cases is that this type of fraud unquestionably becomes the topic of conversation as opposed to the many positive stories and many good people who genuinely benefit from the food stamp program,” said U.S. Attorney Michael Moore.
In a second, separate food stamp fraud and money laundering case in Wilkinson County, Alfred Boyd previously entered a plea of guilty to Food Stamp Fraud and was sentenced on October 31, 2013 to serve fifty-two (52) months in prison and to pay restitution in the amount of $800,000.00 to the U.S. Department of Agriculture.
Mr. Boyd owned the Northwind Mini Mart in McIntyre, Georgia. Between December 2009 and March 2011, he conspired with his niece, Chiquita Boyd, and a number of food stamp recipients, to defraud the Food Stamp Program. Each food stamp recipient would provide Mr. Boyd with an electronic benefits transfer (EBT) card and personal identification number and tell the defendant how much cash he or she wanted in exchange for EBT benefits.. Mr. Boyd would then run the EBT card through the point of sale machine administered by the Food Stamp Program as though the cardholder had purchased food when, in fact, the cardholder got cash instead. Mr. Boyd admitted that he knew that an EBT card was to be used to purchase food only and not to be sold for cash. Mr. Boyd would retain a percentage of the cash amount the food stamp recipient requested.
Eleven (11) other defendants from Wilkinson County pled guilty to participating with Mr. Boyd in the food stamp fraud and have been sentenced: Tracey McDowell, Keisha Robinson, Sheena Sanders, Krystal Allen, Brandy Day, Lashaundra Evans, Cassandra Harris, Willie Harris, Jazmin Hunter, Karrie Jackson and Pamela Johnson. Many of the defendants participated with both Mr. Shinholster and Mr. Boyd in food stamp fraud.
“These were cases of greed and serious crimes,” stated Veronica F. Hyman-Pillot, Special Agent in Charge, Internal Revenue Service Criminal Investigations. “Honest and law abiding citizens are fed up with people who use deceit and fraud to obtain money that belongs to others for their own personal benefit. We are pleased with the successful resolution of these investigations due to the cooperative efforts of our law enforcement partners.”
The cases were investigated by the Internal Revenue Service Criminal Investigations, the Federal Bureau of Investigation, the Georgia Department of Human Services Office of Inspector General and the Wilkinson County Sheriff’s Office. The cases were prosecuted by Assistant United States Attorneys Michael Solis, Danial Bennett and Julia Bowen.
For additional information please contact Pamela Lightsey, Public Information Officer, United States Attorney’s Office at (478) 621-2603.
Felon in Possession of A Firearm Sentenced in Federal CourtRead the Press Release
MOBILE, Ala. – Antonio Bernita Sims, 37, of Mobile, was sentenced today in federal court for his illegal possession of a firearm having been previously convicted of a felony offense, to a term of 27 months imprisonment. Judge William H. Steele imposed the sentence. The judge also ordered that Sims serve a three-year term of supervised release when he completes his term of imprisonment. No fine was imposed, but the judge ordered that Sims pay a $100 mandatory special assessment.
The case was investigated by the Mobile Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted in the United States Attorney=s Office by Assistant United States Attorney Gloria Bedwell.
Felon Convicted of Gun Possession, Facing 15 Year Mandatory TermRead the Press Release
PHILADELPHIA – A federal jury, yesterday, convicted Francis Aponte, 47, of Philadelphia, of possession of a firearm by a convicted felon. On June 17, 2012, Aponte was standing on the sidewalk near Indiana Avenue and 4th Street when two Philadelphia Police Officers spotted him shooting a gun into the air. The officers approached and saw Aponte throw the handgun – a .380 caliber Indian Arms semi-automatic – to the ground. Aponte was arrested and charged as a convicted felon in possession of a firearm. A sentencing hearing is scheduled for March 4, 2014. Aponte faces a mandatory minimum term of 15 years in prison with a maximum sentence of life, up to five-years of supervised release, a maximum fine of $250,000, and a $100 special assessment.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Philadelphia Police Department. It is being prosecuted by Assistant United States Attorney Jose R. Arteaga.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Federal Grand Jury Criminal Indictments AnnouncedRead the Press Release
TULSA, Okla. — The results of the December 2013 Federal Grand Jury were announced today by Danny C. Williams Sr., United States Attorney for the Northern District of Oklahoma.
The following named individuals have been charged with a federal crime or crimes by the return of an indictment by the Grand Jury. The return of an indictment is a method of informing the defendant of alleged violations which must be proven in a court of law beyond a reasonable doubt to overcome the defendant’s presumption of innocence.
Glendyn Ayala-Carbajal. Alien in the United States After Deportation. Ayala-Carbajal, 24, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in April 2008 near San Antonio, Texas. If convicted, the statutory maximum penalty would be 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Sandra Ayala-Dominguez. Alien in the United States After Deportation. Ayala-Dominguez, 42, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in February 2013 near Hildalgo, Texas. If convicted, the statutory maximum penalty would be of 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Joel Deloera-Escalera, Samuel Garcia-Escalera, and Courtney Riley. Drug Conspiracy, Maintaining Drug-Involved Premises, Possession of Firearm and Ammunition by Alien Illegally in the United States. Deloera-Escalera, 33, Garcia-Escalera, 35, both illegal aliens, and Courtney Riley, 33, of Broken Arrow, are charged with conspiring to distribute 500 grams or more of methamphetamine. Deloera-Escalera and Garcia-Escalera are also charged with maintaining a place for the purpose of storing and distributing methamphetamine, being unlawfully in the United States, and possession of firearms and ammunition. If convicted, all defendants would face the maximum statutory penalty for drug conspiracy of not less than 10 years imprisonment and up to a $10,000,000 fine; Deloera-Escalera and Garcia-Escalera would face an additional term of imprisonment not to exceed 20 years and a fine of up to $500,000 for maintaining a place for the purpose of storing and distributing methamphetamine and up to 10 years maximum imprisonment and $250,000 fine for the firearm charges. The Oklahoma Bureau of Narcotics and Dangerous Drugs is the lead agency.
Adan Gonzalez-Torres. Alien in the United States After Deportation. Gonzalez-Torres, 35, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in May 2010 near Del Rio, Texas. If convicted, the maximum statutory penalty would be 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Tony Newman-Hilburn and Angela Kay Torres. Possession with Intent to Distribute Marijuana, Possession of Firearms in Furtherance Commission of a Drug Trafficking Crime, and Maintaining on Drug-Invoked Premises. Newman-Hilburn, 35, of Tulsa, is charged with possession with intent to distribute marijuana, possession of a 40 caliber pistol, .32 caliber pistol, 9mm pistol, .2333 caliber pistol, and 12 gauge shotgun in furtherance of a drug trafficking crime. Torres, of Tulsa, is charged with maintaining on drug-invoked premise for the purpose of storing, distributing, and using marijuana. If convicted, the maximum statutory penalty for possession with intent to distribute marijuana would be not more than 5 years imprisonment and/or a $4,000,000 fine; possession of firearms in furtherance of a drug trafficking crime carries a 5 year consecutive sentence and/or $250,000 fine; and maintaining on drug-invoked premise would be not more than 20 years imprisonment and/or a fine not more than $500,000. The Federal Bureau of Investigation is the lead agency.
Juan Saavedra-Juarez. Alien in the United States After Deportation. Saavedra-Juarez, 34, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in September 2011 near Harlingen, Texas. If convicted, the maximum statutory penalty would be 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Dethan Ashley Sparks and Lukan Thomas Holmes. Assault with a Dangerous Weapon with Intent to do Bodily Harm in Indian Country and Assault Resulting in Serious Bodily Injury in Indian Country. Sparks, 18, and Holmes, 19, both of Wyandotte, Oklahoma, are charged with assaulting and injuring an Indian male victim. The Indictment alleges Sparks assaulted the victim with a dangerous weapon by striking him in the face with a rock. If convicted, the statutory maximum penalty would be not more than 10 years imprisonment and/or a $250,000 fine. The Bureau of Indian Affairs, Miami Agency is the lead in the case.
Ramon Torres-Marin. Alien in the United States After Deportation. Torres-Marin, 52, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in December 1999 near El Paso, Texas. If convicted, the maximum statutory penalty would be 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Jose Ines Vera-Diaz. Alien in the United States After Deportation. Vera-Diaz, 47, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in July 2012 near Del Rio, Texas. If convicted, the maximum statutory penalty would be 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
J. Guadalupe Villalobos Gonzalez. Possession with Intent to Distribute Methamphetamine and Possession of Firearms in Furtherance of a Drug Trafficking Crime. Villalobos Gonzalez, 32, is charged with possession with the intent to distribute 50 grams or more of methamphetamine and possessing a 7.62x39 caliber semi-automatic assault rifle, .38 caliber pistol, and .25 caliber pistol in furtherance of a drug trafficking crime. If convicted, the statutory minimum penalty for possession with intent to distribute 50 grams or more of methamphetamine would be not less than 5 years imprisonment and up to $5,000,000 fine; the firearm charge carries not less than 5 years imprisonment and up to a $250,000 fine. The Oklahoma Bureau of Narcotics and Dangerous Drugs is the lead agency.
El Paso Man Sentenced to Federal Prison for Downloading Child PornRead the Press Release
In El Paso, 33-year-old Thomas Daly, a former machine operator for a local food producer, was sentenced to 188 months in federal prison followed by ten years of supervised release for downloading child pornography announced United States Attorney Robert Pitman and Homeland Security Investigations Special Agent in Charge Dennis Ulrich, El Paso Division.
In September 2012, a routine information technology inspection revealed that Daly was downloading and viewing child pornography over the internet using peer-to-peer file sharing networks. A subsequent search warrant executed by HSI agents at the defendant’s residence resulted in the seizure of two computers and various DVDs, CDs, and VHS cassettes. A forensics examination of those items revealed the presence of almost 500 videos and more than 33,000 images depicting child pornography. On September 10, 2013, Daly pleaded guilty to one count of receipt of child pornography.This investigation was conducted by Homeland Security Investigations in El Paso. Assistant United States Attorney Ian Martinez Hanna prosecuted this case on behalf of the government.
Eastern European Man Pleads Guilty to Internet FraudRead the Press Release
Rochester, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Dumitru Doban, a/k/a Octavian Kucera, a/k/a Kucera Oktavian, a/k/a Pavel Luhovny, a/k/a Michal Pudil, a/k/a Tomas Kulla, 27, of Moldova, pleaded guilty before U.S. District Judge Frank P. Geraci, Jr. to wire fraud conspiracy. The charge carries a maximum penalty of 20 years in prison, a fine of $250,000 or both.
Assistant U.S. Attorney Brett A. Harvey, who is handling the case, stated that the defendant, a citizen of Moldova, participated in a conspiracy to defraud purchasers of motor vehicles over the Internet. As part of the scheme, vehicle advertisements were placed online via websites such as eBay, autotrader.com, and autotraderclassics.com. Potential buyers responded by e-mail to the advertisements and were be contacted by individuals identifying themselves as the listed sellers of the vehicles. E-mail correspondence occurred between the two parties with descriptions of the vehicles, negotiations of the purchase price, shipping information, and purchase information. Once an agreement was reached for the purchase of the vehicles, the buyers were instructed to utilize a third party, such as eBay Motors and Google Wallet, to conduct the transaction. These third-party websites (bogus and unrelated to legitimate third party websites) were made to look legitimate.
After signing up for the third-party websites, the buyers were sent e-mails (purporting to be from the third-party websites, such as eBay Motors and Google Wallet), directing them to send wire transfers for the purchase price, plus shipping costs, to bank accounts that were opened by the defendant in Rochester, New York, Columbus, Ohio, Alexandria, Virginia, and Birmingham, Alabama, using fake names and false Czech Republic passports. After the buyers sent the wire transfers to the bank accounts, the defendant sent the money overseas, primarily to the Ukraine and Moldova, through bank-to-bank wire transfers and money transfer services, or withdrew the money from the accounts. The prospective online buyers never received any of the vehicles supposedly offered for sale as part of the scheme.
A total of 18 people, from New York, California, Nevada, North Carolina, and Arizona, and Canada, were victims of the Internet fraud scheme. Those victims transferred a total of $257,489 to the bank accounts opened by the defendant. As part of the plea agreement, the defendant admitted that the overall conspiracy – which included similar fraudulent conduct by a co-conspirator, Alexandru Turcan, in the Northern District of New York -- involved losses of more than $400,000 but less than $1,000,000.
Another defendant, Vasile Leu, also a citizen of Moldova, is being prosecuted for allegedly participating in the same Internet fraud scheme. A federal grand jury returned an indictment charging Leu with wire fraud conspiracy on September 24, 2013. The case is still pending, and the defendant is presumed innocent unless and until convicted in a Court of law.
Sentencing is scheduled for April 7, 2014, at 3:00 p.m. before Judge Geraci.
The plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Brian Boetig.Eagle Pass Businessman Pleads Guilty to Role in Maverick County Bribery, Kickback and Bid-Rigging SchemeRead the Press Release
In Del Rio, 52-year-old Salvador Castillon, owner of South Texas Concrete based in Eagle Pass, pleaded guilty to paying bribes to a Maverick County commissioner in order to secure county construction contracts announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.
Appearing before U.S. District Judge Alia Moses, Castillon pleaded guilty to one count of paying a bribe to an agent of an organization receiving federal funds. According to court records, Castillon was awarded Maverick County construction contracts totaling $416,800 in 2010 and $148,000 in 2011. Castillon admitted that during that time period, he paid the Maverick County Precinct 2 commissioner approximately $57,000 in return for being awarded the construction contracts.
Castillon, who remains on bond pending sentencing, faces up to ten years in federal prison and a maximum $250,000 fine. Sentencing is scheduled for 9:00am on May 12, 2014, before Judge Moses in Del Rio.This ongoing investigation is being conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety. Individuals who have first-hand information about corruption, fraud, or bribery related to Maverick County are urged to contact the FBI at (210) 225-6741. Assistant United States Attorney Michael Galdo is prosecuting this case on behalf of the Government.
Eagle Pass Businessman Pleads Guilty to Bank FraudRead the Press Release
In Del Rio today, 41-year-old Jose Flores, III, owner of Eagle Pass-based N5 Group, LLC, (N5) pleaded guilty to a bank fraud scheme announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.
According to court records, the defendant, through N5, attempted to serve as raw materials transportation providers to businesses in Eagle Pass and to companies operating in the Eagle Ford Shale in South Texas. In April 2011, N5 established a Large Fleet Accounts Receivable Financing agreement with TAB Bank, Inc in Utah. The primary purpose of N5's account with TAB was to establish a factoring relationship between the two entities. In a factoring arrangement, a bank agrees, for a fee, to serve as the recipient of payments that are owed to a company. Once this agreement is made, the company will assign its accounts receivable to the bank. The bank will then advance a large percentage of the yet-unpaid accounts receivable to the business expecting payment. Thereafter, the bank will begin to collect payments from the customer indebted to the business. Ideally, the company expecting payment will benefit because it will obtain cash from the bank immediately and thus need not wait for its accounts to come due before receiving payment. The bank benefits as well because it charges a commission for its service as receiver of the outstanding accounts.
Appearing before U.S. District Judge Alia Moses, Flores pleaded guilty to one count of bank fraud. By pleading guilty, Flores admitted that in July 2011, he submitted to TAB Bank a forged invoice in the amount of $51,000 for work N5 was to perform for a customer. Pursuant to the factoring agreement, the defendant fraudulently received $35,000 from TAB Bank. When TAB subsequently began its efforts to collect payment from the customer, it found that N5 had never done any work for that customer. In fact, that customer owed N5 no money at all.
Flores faces up to 30 years in federal prison and a maximum $1,000,000 fine as well as $35,000 restitution to TAB Bank. He remains on bond pending sentencing scheduled for May 12, 2014, before Judge Moses in Del Rio.
This investigation was conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety. Assistant United States Attorney Timothy A. Duree is prosecuting this case on behalf of the Government.
Deported Alien Sentenced to Time Served for Illegally Re-entering United StatesRead the Press Release
PITTSBURGH - An alien found in Pittsburgh, Pennsylvania, has been sentenced in federal court to time served on his conviction of illegal re-entry after deportation, United States Attorney David J. Hickton announced today.
United States District Judge Terrence F. McVerry imposed the sentence on Jose Mariano Perez-Flores, age 33, of Honduras
According to the information presented to the court, Jose Mariano Perez-Flores, an alien, was formally removed from the United States by United States Immigration and Customs Enforcement on Aug. 17, 2007. Jose Mariano Perez-Flores was found to be illegally present in Pittsburgh on Sept. 20, 2013.
Assistant United States Attorney Paul E. Hull prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Department of Homeland Security, Immigration and Custom Enforcement for the investigation leading to the successful prosecution of Perez-Flores.