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Monday 2 December 2013
Romanian Man Heads to Prison on 33 Counts of Wire FraudRead the Press Release
VICTORIA, Texas – Romanian national Doru Gabriel Trifu, 29, has been ordered to federal prison following his convictions on 33 counts of wire fraud in an Internet fraud scheme, announced United States Attorney Kenneth Magidson and Brian M. Moskowitz, special agent in charge of Homeland Security Investigations (HSI). A federal jury sitting in Victoria convicted Trifu following a four-day trial on Wednesday, Sept. 25, 2013.
Today, Senior U.S. District Judge John Rainey, who presided over the trial, sentenced Trifu to a total of 96 months in federal prison to be followed by three years supervised release. He was further ordered to pay $562,239.78 restitution. In handing down the sentence, Judge Rainey noted this was the most extensive fraud scheme he had ever seen and that the scheme played to someone’s allegiances and loyalties to the military. Not a U.S. citizen, Trifu is expected to face deportation proceedings following his release from prison.
Trifu, a Romanian non-immigrant residing in Orangevale, Calif., was part of the fraudulent scheme in which consumer items were listed for sale over the Internet. Individuals attempting to make purchases were instructed to send money via MoneyGram to an escrow agent who would accept the funds, complete the transaction and deliver the item. However, after the buyer electronically transferred the money, the item would never be delivered.
“This case serves as an important and timely ‘Cyber Monday’ reminder that consumers need to be careful when shopping online,” said Moskowitz.
During trial, the government presented videos and numerous surveillance photographs taken from Wal-Mart stores across Texas, Mississippi and Alabama where the fraudulent transactions occurred.
Testimony was provided by several victims who described how they were told they were purchasing the item from a U.S. serviceman who was about to deploy to the Middle East and were told to use a third party broker to complete the transaction.
An agent with Homeland Security Investigations (HSI) also testified and identified a pattern of approximately 230 fraudulent transactions between March 2011 and February 2012 using two fake U.S. passport numbers. Over the course of the scheme, the amount of identified fraud totaled more than $567,000.
Trifu has been in custody since his November 2012 arrest in California where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.The case was investigated by HSI. Assistant U.S. Attorney Lance Watt is prosecuting.
Rochester Man Sentened to 15 Years for Attempted Production of Child PornographyRead the Press Release
Planned to Create Still Images and Videos of a 12-Year-Old Girl
ALBANY, NEW YORK – JASON FRANK, age 27, of Rochester, New York, was sentenced to fifteen (15) years of imprisonment for attempted production of child pornography on November 27, 2013 in Albany by Chief United States District Court Judge Gary L. Sharpe, announced United States Attorney Richard S. Hartunian and Joseph D’Amico, Superintendent of the New York State Police. FRANK, who had entered a guilty plea on August 8, 2013, was also ordered to serve a 10-year term of supervised release, to have no unsupervised contact with minors, and to register with the New York State Sex Offender Registry Program.
In February 2013, FRANK began chatting online with an undercover New York State Police officer posing as a twelve-year-old girl in Albany, New York. Over approximately two months, FRANK sent the undercover officer still images and videos of child pornography in an effort to convince her to meet with him at a Syracuse hotel so that he could have sex with her and film it. On April 9, 2013, FRANK arrived at a hotel in Syracuse expecting to meet the girl and to create child pornography, but he was arrested by the New York State Police. At the time of FRANK’s arrest, he possessed a digital camera with video recording capabilities and a thumb drive that contained still images and videos of child pornography.
This case was investigated by the New York State Police.
Prior Sex Offender Pleads Guilty to Federal Child Pornography ChargesRead the Press Release
ALBUQUERQUE – James Olsson, 60, of Albuquerque, N.M., pleaded guilty this morning to a two-count indictment charging him with possession of visual depictions of minors engaged in sexually explicit conduct. Under the terms of his plea agreement, Olsson will be sentenced to ten years in federal prison followed by a lifetime of supervised release. Olsson will be required to register as a sex offender after he completes his prison sentence.
The indictment charged Olsson with possession of child pornography on April 11, 2013, in Bernalillo County, N.M. According to court filings, on that day, a state probation officer learned that Olsson possessed child pornography during a routine field visit with Olsson at his residence. Olsson was on probation for failure to register as a sex offender as required by his 2009 state court conviction for possession of child pornography. Olsson was arrested on state charges that day and was in state custody until he was transferred to federal custody on June 26, 2013.
In his plea agreement, Olsson admitted that while on probation for failure to register as a sex offender, he obtained child pornography images and videos from the Internet. Olsson further admitted that he had been collecting child pornography for approximately six months prior to his arrest in April 2013.
Olsson must serve an enhanced sentence of not less than ten years in prison because of his prior child pornography conviction. Olsson has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Albuquerque office of the FBI, the Bernalillo County Sheriff’s Office and the New Mexico Corrections Department Probation and Parole, and is being prosecuted by Assistant U.S. Attorney Marisa A. Lizarraga.
The case was filed 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 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.
Payette Man Pleads Guilty to Possessing Child PornographyRead the Press Release
BOISE – Steven Ray Hemenway, 47, of Payette, Idaho, pleaded guilty today in United States District Court to possessing sexually explicit images of minors, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, in December 2012, law enforcement officers executed a search warrant at a residence in Toronto, Ontario, Canada. The individual at that residence confessed to distributing images of child pornography via his e-mail account. Investigators reviewed the account and developed information that the Canadian subject had sent images and videos of child pornography to an e-mail account associated with Hemenway. In February 2013, federal agents executed a search warrant at Hemenway’s home in Payette and seized his computer. During an interview with investigators, Hemenway admitted that he had been receiving child pornography via the Internet for several years, according to the plea agreement. He also told agents that he had e-mailed between 100 and 500 images of child pornography to approximately ten other e-mail accounts during the previous year.
The images and videos recovered from Hemenway’s computer confirmed that the user had been receiving and distributing child pornography, including sexually explicit material depicting prepubescent minors.
The material was sent to the National Center for Missing and Exploited Children (NCMEC) for comparison with previously identified victims of abuse. According to NCMEC, among the images found on Hemenway’s computer were previously known victims from North Carolina, Georgia, Washington, Missouri, Connecticut, Kentucky, Pennsylvania, Canada, United Kingdom, Ukraine, France and Belgium.
The charge is punishable by up to ten years in prison, a maximum fine of $250,000, and five years to lifetime supervised release.
Sentencing is set for February 25, 2014, before U.S. District Edward J. Lodge at the federal courthouse in Boise.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Orthopedic Surgeon Pleads Guilty to Conspiracy to Take Fraudulent Tax DeductionsRead the Press Release
ALEXANDRIA, Va. – Abdul Razaq, an orthopedic surgeon in La Plata, Md, pleaded guilty today to conspiring to defraud the United States Department of Treasury by taking fraudulent tax deductions as part of a decades-long scheme to conceal the transfer of at least $3.5 million from the government of Pakistan to fund lobbying efforts in America related to Kashmir.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; John P. Carlin, Acting Assistant Attorney General for National Security; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division; and Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington D.C. Field Office, made the announcement after the plea was accepted by United States District Judge Liam O’Grady.
Razaq faces a maximum penalty of five years in prison when he is sentenced on July 18, 2014.
In a statement of facts filed with the plea agreement, Razaq, a member of the Board of Directors of the Society for International Help, a 501(c)(3) tax-exempt charity based in New York, admitted to taking charitable deductions for money that he routed through the Society for International Help, as well as another charity – the Kashmiri American Council (KAC) – even though he was reimbursed at least in part for these deductions in Pakistan. Razaq also admitted to being part of Syed Ghulam Nabi Fai’s financial network of donors, which Fai used to conceal that the KAC was funded with at least $3,500,000 from the Inter-Services Intelligence Directorate, Pakistan’s military intelligence service. Fai was sentenced to serve two years in prison on March 30, 2012.
This investigation is being conducted by the FBI’s Washington Field Office and the IRS Criminal Investigation’s Washington Field Office. The prosecution is being handled by Assistant U.S. Attorney Gordon Kromberg, Trial Attorney John Gibbs of the Counterterrorism Section of the Justice Department’s National Security Division, and Special Assistant U.S. Attorney Allison Ickovic from the Justice Department’s Tax Division.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.One Defendant Sentenced, Another Pleads Guilty in Dodge City Racketeering CaseRead the Press Release
WICHITA, KAN. - One member of a Dodge City street gang was sentenced and another pleaded guilty Monday in a federal racketeering case, U.S. Attorney Barry Grissom said today.
Fabian Neave, 26, Dodge City, Kan., was sentenced to 60 months in federal prison. He pleaded guilty to one count of racketeering conspiracy. In his plea, he admitted committing crimes while he was a member of the Diablos Viejos and associated with the Norteno street gang.
Alfredo Beltran-Ruiz, 22, Dodge City, Kan., pleaded guilty to one count of aiding and abetting attempted murder, which was a violent crime in aid of racketeering.
In his plea, Neave admitted being involved in three incidents. He took part in an Aug. 27, 2011, assault at 703 E. 9th Ave. in Dodge City, and he possessed methamphetamine with intent to distribute on Dec. 27, 2011. In the third incident, on July 2, 2008, he and other Nortenos robbed a victim named Bryant Licon. During the robbery, Neave held a knife to Licon. He and two other Nortenos split the money from the robbery.
In his plea, Beltran-Ruiz admitted that on March 15, 2011, he aided and abetted the attempted murder of a victim named Reyes Delira-Padilla by firing shots at the victim’s house at 1705 Ave. D in Dodge City. Delira-Padilla was a member of the rival Sureno gang.
Beltran-Ruiz is set for sentencing Feb. 24. He faces a penalty of up to 10 years in federal prison and a fine up to $250,000.
Both defendants were among 23 Nortenos indicted in May 2012. It was only the second time a federal RICO Act indictment (Racketeer Influenced and Corrupt Organizations Act) had been filed in Kansas. So far, 21 defendants have been convicted. Defendants Adam Flores and Jayson Vargas are awaiting trial.
Grissom commended the Dodge City Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Ford County Sheriff?s Office, the Ford County Attorney’s Office, the Kansas Bureau of Investigation, Assistant Aaron Smith and Assistant U.S. Attorney Lanny Welch for their work on the case.Navajo Man Sentenced to 188 Months Imprisonment for Armed Bank RobberyRead the Press Release
PHOENIX – On Dec. 2, 2013, Michael James, 42, of Tohatchi, N.M., was sentenced by U.S. District Judge Howard D. McKibbento 188-months imprisonment following his plea of guilty to armed bank robbery.
On May 17, 2013, James entered the First American Credit Union, located on the Navajo Indian Reservation in Window Rock, Ariz., and displayed a BB handgun to the bank tellers – demanding money. James was given the sum of $15,226.
The instant offense constituted James’ third felony conviction for a crime of violence.
The investigation in this case was conducted by the Federal Bureau of Investigation and the Navajo Criminal Investigator’s Office in Window Rock, Ariz. The prosecution was handled by Cassie Bray Woo, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-13-8145-PCT-DGC
RELEASE NUMBER: 2013-090_JamesFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Mingo’s Former Chief Magistrate Pleads Guilty to Federal Election FraudRead the Press Release
Dallas L. Toler is the fourth former Mingo official to plead guilty in connection with federal corruption probe
CHARLESTON, W.Va. –Mingo County’s former chief magistrate pleaded guilty in Charleston federal court to voter registration fraud, U.S. Attorney Booth Goodwin announced today. Dallas L. Toler, 45, is the fourth former Mingo County official to plead guilty to charges in connection with a federal corruption investigation.
U.S. Attorney Booth Goodwin said, "Corruption is the biggest threat to democracy. In Mingo County, corruption was an epidemic. Once again in this investigation we have a judge engaging in corruption—this time corruption of the electoral process so that he and his cohorts could keep their jobs." Goodwin continued, "The people of Mingo County are tired of these shenanigans, and we’ll continue to do what’s necessary to help them."
In or about April 2012, Toler, who at the time was a member of a political campaigning and fundraising group known as "Team Mingo," participated with other individuals in an effort to identify potential voters who would support Team Mingo's candidates in the 2012 primary election. Toler was a candidate to retain the office of magistrate.
Toler, a landlord of several rental properties in and around Mingo County, went to one of his rental properties in April 2012 to collect rent. During the visit to his rental unit, Toler encountered an individual who he learned was on probation for a felony offense. In a later encounter, Toler told the individual that he would arrange for the individual to be registered to vote in the 2012 primary election. Toler knew that the individual was on probation for a felony and was ineligible to vote. Toler later procured the completion and submission of a voter registration application in the name of the known person. Toler also caused the application to be completed and caused it to include a false statement that the known person was not on probation for a felony. On or about April 23, 2012, after receiving a voter registration card as the result of Toler's actions, the known person unlawfully voted in the 2012 primary election in Mingo County.
United States District Court Judge Thomas E. Johnston presided over today’s plea hearing and will sentence Toler on March 10, 2014. Toler faces five years in prison and a $250,000 fine. Toler previously resigned as chief magistrate of Mingo County in October. As part of his federal guilty plea, Toler's plea agreement with the Office of the U.S. Attorney required him to resign as a Mingo County magistrate and never seek elected office again.
Toler was previously appointed as magistrate in January 2012 by former Mingo County Circuit Judge Michael Thornsbury.
Thornsbury, 57, pleaded guilty in October for his role in a scheme to violate the constitutional rights of an individual to cover up evidence of illegal drug use and other misconduct by late Mingo County Sheriff Eugene Crum. Thornsbury faces up to 10 years in prison when he is sentenced on January 13, 2014.
Another former Mingo County official, C. Michael Sparks, 44, previously pleaded guilty on Nov. 18 in connection with a conspiracy to deprive a Mingo County resident of his constitutional rights. Sparks, Mingo County's former prosecuting attorney, faces a year in prison when he is sentenced on February 24, 2014.In a separate matter, former Mingo County Commissioner David Baisden pleaded guilty in connection with a scheme to illegally extort a discount from a Mingo County tire store. Baisden, 66, resigned from the Mingo County Commission in October. Baisden faces up to 20 years in prison when he is sentenced on January 14, 2014.
The investigation is being conducted by the FBI and the West Virginia State Police. Counsel to the United States Attorney Steven Ruby and Assistant United States Attorney Haley Bunn are handling the prosecution.
Click here to view a copy of the plea agreement
Middleburg Man Sentenced to 5 Years in Prison for Receipt of Child PornographyRead the Press Release
Jacksonville, FL – U.S. District Judge Timothy Corrigan has sentenced Robert Hohman (66) to five years in federal prison for receipt of child pornography. Hohman was indicted on October 18, 2012. He pleaded guilty to the offense on August 6, 2013.
In December 2010, the Federal Bureau of Investigation (“FBI”) initiated an investigation regarding a large volume of child pornography being distributed by a French-based message board. A message board is an online discussion website that allows users to hold conversations via posted messages. Over the course of this investigation, a customized message board or forum was created, which appeared to be distributing large amounts of child pornography. Further investigation revealed that one of the individuals utilizing the forum was Robert Hohman.
On August 7, 2012, special agents with the FBI conducted a non-custodial interview of Hohman at his job. During the interview Hohman confessed to registering a specific username and associated email address on the forum. In addition, he admitted that he had been seeking, viewing, and downloading child pornography for many years. During the interview, Hohman gave the FBI consent to search his home computer. A forensic review of Hohman’s computer revealed that he downloaded over a dozen videos and hundreds of images of children, as young as toddlers, involved in sexually explicit conduct with adults.
This case was investigated by Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Malisa Chokshi.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Michigan Aquarium Store Operators Plead Guilty to Illegal Trafficking of Marine LifeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Otha Easley, Acting Special Agent in Charge, NOAA Fisheries Office of Law Enforcement, and Edward Grace, Deputy Assistant Director, U.S. Fish & Wildlife Service Office of Law Enforcement, announced that Richard Perrin, 80, formerly of Romulus, Michigan, pled guilty yesterday in federal District Court in Key West for conspiring with others to transport, sell, receive, acquire, and purchase fish and wildlife, Sea Fans (Gorgonia flabellum and Gorgonia ventalina), ornamental tropical fish, sharks, and alligators (Alligator mississippiensis), with a fair market value in excess of $350.00, knowing the wildlife was taken, possessed, transported, sold, and intended to be sold in violation of the laws and regulations of the State of Florida, in violation of Title 16, United States Code, Sections 3372(a)(2)(A), 3372(a)(4), and 3373(d)(1) and (2), all in violation of Title 18,United States Code, Section 371.
United States District Court Judge Jose E. Martinez, who accepted Perrin’s plea, set sentencing in the matter for March 25, 2014 at 2:00 p.m. in Key West. Perrin faces a maximum sentence of five years in prison, three years of supervised release, and a criminal fine of up to $250,000. He also faces forfeiture of the vehicle used in the commission of the Lacey Act Violations. Perrin’s co-defendant, Joseph Franko, 35, also of Romulus, entered a guilty plea to the same charge on November 25, 2013 and faces the same possible sentence and fine.
According to the Indictment and Joint Factual Statements submitted to the Court, from approximately December 2008 through December 2011, Perrin and Franko engaged in a conspiracy to purchase, harvest, and transport marine life and reptiles from Florida to Michigan for sale through a business known as Tropicorium, Inc. Perrin was the owner Tropicorium, engaged in the day-to-day management and operation of the corporation, while Franko was an employee. Tropicorium was organized in 1993 under the laws of Michigan with its principal place of business in Romulus. Tropicorium was engaged in the purchase and retail sale of marine life and reptiles, including sharks, marine invertebrates, Sea Fans, ornamental tropical fish, and alligators.
The defendants admitted that they failed to acquire or possess the licenses required by Florida Statute for the marine life they harvested during multiple trips to the Florida Keys. Additionally, the Sea Fans taken by the defendants and sold in Michigan are prohibited from being harvested from the waters of the State or the Florida Keys National Marine Sanctuary, where they plied their trade. Richard Perrin and Franko also made stops while en route to the Keys in the area of Big Cypress National Preserve, where they illegally poached juvenile alligators to sell through Tropicorium. Unknown to the defendants, on one occasion they actually sold a baby alligator and illegal Sea Fans from a Florida harvesting trip to an undercover Special Agent of the Fish & Wildlife Service. They also utilized a facility on Grassy Key as maintenance base for their harvested marine life until they were ready to ship or transport the specimens to Michigan for sale.
Mr. Ferrer commended the joint investigative efforts of the Special Agents of the NOAA Office of Law Enforcement and the Fish & Wildlife Service Office of Law Enforcement who participated in the long-term investigation into the illegal harvesting and sale of marine life resources from the Florida Keys known as Operation Rock Bottom, and the assistance of the Officers of the Michigan Department of Natural Resources. This case was prosecuted by Assistant U.S. Attorneys Thomas Watts-FitzGerald of the Economic & Environmental Crimes Section and Antonia Barnes of the Asset Forfeiture Division.
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.
Macy Man Sentenced for Robbery ConvictionRead the Press Release
United States Attorney Deborah R. Gilg announced that Cory Woodhull, age 25 of Macy, Nebraska, was sentenced for his conviction for robbery in Indian Country. Chief United States District Court Judge Laurie Smith Camp sentenced Woodhull to 40 months imprisonment to be followed by three years of supervised release. Woodhull was further ordered to pay restitution in the amount of $750.
Woodhull found his victim sitting in a snow bank and unable to make it to his residence following a New Year’s Eve party. Woodhull assisted the victim to his home but, once inside, Woodhull beat and kicked the victim while demanding the PIN to the victim’s food stamp card. Woodhull eventually took the victim’s food stamp card and a DVD collection and left the residence. The victim suffered serious bodily injuries and was unable to move about his residence for approximately three days after the assault.
This case was investigated by the Federal Bureau of Investigation.
Lymphedema & Wound Care Institute Settle False Claims Act AllegationsRead the Press Release
HOUSTON - Susan Morgan, Erin Hamilton and Ryan Chuston, doing business as the Lymphedema & Wound Care Institute Inc., have paid the United States $4.3 million to settle claims they violated the Federal False Claims Act by submitting claims to the Medicare Program for physical therapy treatments provided by unqualified therapists, announced United States Attorney Kenneth Magidson. Additionally, under the terms of the settlement agreement, Morgan will be barred from participating in federal health benefit programs for a period of 10 years.
Morgan, Hamilton and Chuston conducted business in four locations throughout the Houston area as the Lymphedema & Wound Care Institute. The settlement announced today involved allegations that from Jan. 2, 2006 through Sept. 12, 2012, they billed the Medicare program for providing manual lymphatic drainage therapy to Medicare beneficiaries using massage therapists as opposed to physical therapists as required under the rules and regulations governing the Medicare program.
“Today’s settlement once again demonstrates our commitment to fight the fraud and abuse that threatens the financial health of our federal healthcare programs,” said Magidson. “In addition to yielding a substantial recovery for taxpayers, this settlement will prohibit Morgan from participating in the federal health benefit programs for several years, which should deter similar conduct in the future.”
By agreeing to a voluntary suspension from federal health benefit programs, Morgan will not be allowed to bill these programs for treating Medicare beneficiaries for 10 years.
Also as part of the agreement, Hamilton and Chuston have agreed to operate the Lymphedema & Wound Care Institute under a corporate integrity agreement to be monitored by the Office of Counsel to the Inspector General for the Department of Health and Human Services. The corporate integrity agreement will provide for increased monitoring of Lymphedema & Wound Care Institute’s billing practices.
The settlement resolves allegations made against Morgan, Hamilton and Chuston in a qui tam or whistleblower lawsuit filed in January 2011 in federal court by a physician who also provides manual lymphatic drainage treatments to patients with lymphedema. Under the False Claims Act, private citizens can bring suit on behalf of the government and share in any amounts that are obtained through that legal action. In this case, the whistleblower will receive 19% of the proceeds of the settlement.
The investigation was conducted by the Department of Health and Human Services - Office of Inspector General. Assistant United States Attorney Andrew A. Bobb is prosecuting the case.
Knoxville Attorney Pleads Guilty to Federal Tax OffenseRead the Press Release
KNOXVILLE, Tenn. – Johnny V. Dunaway, 65, of Knoxville, Tenn., pleaded guilty on Dec. 2, 2013, in the U.S. District Court for the Eastern District of Tennessee at Knoxville, to filing a false tax return. Sentencing has been set for 11:00 a.m., Apr. 23, 2014, in U.S. District Court in Knoxville.
Dunaway faces a term of three years in prison. In addition, he may be ordered to pay restitution to the Internal Revenue Service for unpaid taxes.
According to a one-count information filed by the U.S. Attorney in October 2013, Dunaway submitted a false tax return for the 2008 tax year. In conjunction with his guilty plea, Dunaway admitted that his 2008 return failed to declare truthfully the business income that he had received from his law practice.
This conviction is the result of an investigation by the Internal Revenue Service. Assistant U.S. Attorney Frank M. Dale, Jr. represented the United States.
Jicarilla Apache Man Pleads Guilty to a Domestic Assault by a Habitual Offender ChargeRead the Press Release
ALBUQUERQUE – Quentin Scott Veneno, 27, pleaded guilty this morning to a domestic assault by a habitual offender charge under a plea agreement that requires him to serve a 27 month federal prison sentence. Veneno’s guilty plea was announced by Acting U.S. Attorney Steven C. Yarbrough and Police Chief Kendall P. Vicenti of the Jicarilla Apache Tribal Police Department.
Veneno, a member of the Jicarilla Apache Nation who resides in Dulce, N.M., was arrested on Sept. 19, 2013, based on an indictment alleging that he assaulted his domestic partner, also a member of the Jicarilla Apache Nation, in Nov. 2012. Veneno was charged federally as a habitual domestic violence offender because he has two prior domestic violence convictions in the Jicarilla Apache Nation Court.
This morning, Veneno pled guilty to the indictment and admitted assaulting his intimate partner and the mother of his child by striking her in the face multiple times with a closed fist and biting her on the neck. Veneno further admitted that he committed this crime on Nov. 8, 2012, in a location within the Jicarilla Apache Reservation. Veneno also admitted that he previously was convicted on domestic violence charges on two occasions in 2009 before the Jicarilla Apache Nation Court.
Veneno has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Jicarilla Apache Tribal Police Department, and is being prosecuted by Special Assistant U.S. Attorney David Adams. It was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Idaho Aquarium Operators Sentenced for Illegal Trafficking of Marine LifeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Otha Easley, Acting Special Agent in Charge, NOAA Fisheries Office of Law Enforcement, and David Pharo, Resident Agent in Charge U.S. Fish & Wildlife Service, Miami, announce that Ammon Covino, 40, formerly of Meridian, Idaho, and Christopher Conk, 40, of Middleton, Idaho, were sentenced today in federal District Court in Key West for conspiring to harvest, transport, and sell spotted eagle rays and lemon sharks, knowing the marine life were taken, possessed, transported, sold, and intended to be sold in violation of the laws and regulations of the State of Florida, contrary to the federal Lacey Act, Title 16, United States Code, Sections 3372(a)(2)(A), and 3373(d)(1) and (2), all in violation of Title 18, United States Code, Section 371.
Covino was sentenced by United States District Court Judge Jose E. Martinez to one year and a day in prison, followed by a term of supervised release of two years. Additionally, Covino was barred by the Court from any employment during the period of supervised release that involves the possession, display, transportation, exhibition, purchase, or sale of wildlife. Conk, who cooperated with investigators, received a reduced sentence of four months in prison followed by two years of supervised release. Conk was also the subject of an Order of Forfeiture which forfeited the motor vehicle used in perpetrating the crime. As part of his sentence, 180 days of the supervised release is to be served in home detention under electronic monitoring. Conk also received the specific employment prohibition during his period of supervised release, as Covino. In imposing the prison sentences, Judge Martinez stated that the defendants’ conduct “strikes to the very heart of this area and the economy of this area.”
According to the Indictment, Joint Factual Statements submitted to the Court, and argument at sentencing, during March 2012 through approximately November 2012, Covino and Conk engaged in a conspiracy to purchase and transport wildlife from the Florida Keys to Idaho for exhibit at the Idaho Aquarium in Boise. The wildlife included spotted eagle rays and lemon sharks, which required Florida licenses and permits never acquired by the participants in the deals. According to the Factual Statements, Covino and Conk were both at the time officers of the Aquarium, were individually advised of the requirements of the law, and nevertheless directed their Florida-based suppliers to ignore the law and make the shipments. Unknown to Covino and Conk at the time of the phone calls was the fact that the business owner was cooperating with federal authorities and the phone conversations and text messages were recorded. Payment for the various specimens was made by credit cards held in the Aquarium?s name. The defendants acknowledged that their illegal conduct was within the scope of their employment, and intended to benefit, at least in part, the Idaho Aquarium. In the same case, Idaho Aquarium, Inc. pled guilty to the same conspiracy count and is awaiting sentencing.
In a separate criminal proceeding, United States v. Peter C. Covino, IV, Case No. 13-10010-CR-Martinez, Peter Covino, the nephew of Ammon Covino, was tried, convicted, and sentenced for obstruction of justice in connection with his effort to persuade the supplier in the Florida Keys to destroy the invoices and messages related to the illegal purchases of marine life to prevent their use in Ammon Covino’s case, in violation of Title 18, United States Code, Sections 1512(b)(2)(B). Testimony at the trial established that after Ammon Covino had been arrested on February 21, 2013 he induced Peter Covino to make the calls. During the sentencing proceeding, Judge Martinez specifically noted that Peter Covino would likely never have been involved in the criminal conduct but for the actions of his uncle.
Mr. Ferrer commended the joint investigative efforts of the Special Agents of the NOAA Office of Law Enforcement and the Fish & Wildlife Service Office of Law Enforcement who participated in the long-term investigation into the illegal harvesting and sale of marine life resources from the Florida Keys known as Operation Rock Bottom, and the assistance of the Officers of the Idaho Department of Fish & Game. This case was prosecuted by Assistant U.S. Attorneys Thomas Watts-FitzGerald of the Economic & Environmental Crimes Section and Antonia Barnes of the Asset Forfeiture Division, with assistance from the U.S. Attorney’s Office for the District of Idaho.
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.
Health Care Clinic Owners Sentenced for Role in <br /> $8 Million Health Care Fraud SchemeRead the Press Release
Two health care clinic owners were sentenced today in connection with an $8 million health care fraud scheme involving the now-defunct home health care company Flores Home Health Care Inc.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office, and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement.
Miguel Jimenez, 43, and Marina Sanchez Pajon, 29, both of Miami, were sentenced by U.S. District Judge Ursula Ungaro in the Southern District of Florida. Jimenez was sentenced to serve 87 months in prison and Pajon was sentenced to serve 57 months in prison. Jimenez and Pajon pleaded guilty in August to conspiracy to commit health care fraud.
Jimenez and Pajon, who are married, were owners and operators of Flores Home Health, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries.
According to court documents, Jimenez and Pajon operated Flores Home Health for the purpose of billing Medicare for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or not provided. Jimenez’s primary role at Flores Home Health involved controlling the company and running and overseeing the schemes conducted through Flores Home Health. Both Jimenez and Pajon were responsible for negotiating and paying kickbacks and bribes, interacting with patient recruiters, and coordinating and overseeing the submission of fraudulent claims to the Medicare program.
Jimenez, Pajon, and their co-conspirators paid kickbacks and bribes to patient recruiters in return for the recruiters providing patients to Flores Home Health for home health and therapy services that were medically unnecessary and/or not provided. They also paid kickbacks and bribes to co-conspirators in doctors’ offices and clinics in exchange for home health and therapy prescriptions, medical certifications, and other documentation. Jimenez, Pajon, and their co-conspirators used the prescriptions, medical certifications, and other documentation to fraudulently bill Medicare for home health care services, which Jimenez and Pajon knew was in violation of federal criminal laws.
From approximately October 2009 through approximately June 2012, Flores Home Health was paid approximately $8 million by Medicare for fraudulent claims for home health services that were not medically necessary and/or not provided.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorney A. Brendan Stewart of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .
Health Care Clinic Owners Sentenced for Role in $8 Million Health Care Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Mythili Raman, Acting Assistant Attorney General of the Justice Department’s Criminal Division, Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations, Miami Office announce that two health care clinic owners were sentenced today in connection with an $8 million health care fraud scheme involving the now-defunct home health care company Flores Home Health Care Inc.
Miguel Jimenez, 43, and Marina Sanchez Pajon, 29, both of Miami, were sentenced by U.S. District Judge Ursula Ungaro. Jimenez was sentenced to serve 87 months in prison and Pajon was sentenced to serve 57 months in prison. Jimenez and Pajon pleaded guilty in August to conspiracy to commit health care fraud.
Jimenez and Pajon, who are married, were owners and operators of Flores Home Health, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries.
According to court documents, Jimenez and Pajon operated Flores Home Health for the purpose of billing Medicare for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or not provided. Jimenez’s primary role at Flores Home Health involved controlling the company and running and overseeing the schemes conducted through Flores Home Health. Both Jimenez and Pajon were responsible for negotiating and paying kickbacks and bribes, interacting with patient recruiters, and coordinating and overseeing the submission of fraudulent claims to the Medicare program.
Jimenez, Pajon, and their co-conspirators paid kickbacks and bribes to patient recruiters in return for the recruiters providing patients to Flores Home Health for home health and therapy services that were medically unnecessary and/or not provided. They also paid kickbacks and bribes to co-conspirators in doctors’ offices and clinics in exchange for home health and therapy prescriptions, medical certifications, and other documentation. Jimenez, Pajon, and their co-conspirators used the prescriptions, medical certifications, and other documentation to fraudulently bill Medicare for home health care services, which Jimenez and Pajon knew was in violation of federal criminal laws.
From approximately October 2009 through approximately June 2012, Flores Home Health was paid approximately $8 million by Medicare for fraudulent claims for home health services that were not medically necessary and/or not provided.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. This case was prosecuted by Trial Attorney A. Brendan Stewart of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Hartford Man Sentenced to More Than 20 Years in Prison for Producing and Distributing Child PornographyRead the Press Release
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Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that ELIEZER MALDONADO, 26, of Hartford, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 244 months of imprisonment, followed by 15 years of supervised release, for producing and distributing child pornography.
According to court documents and statements made in court, on June 8, 2012, Homeland Security Investigations and Hartford Police conducting a child exploitation investigation executed a state search warrant at MALDONADO’s residence. On that date, MALDONADO admitted that on multiple occasions he had engaged in sexual acts with a minor victim who was under the age of 12, had used a smartphone to take several photographs of the minor victim engaged in sexually explicit poses, and then posted the images to an online file-sharing service. He also admitted that he had traded additional images of child pornography with others via email and online storage accounts.
Subsequent forensic examination of MALDONADO’s smartphone revealed eight images of the minor victim engaged in sexually explicit conduct. Examination of MALDONADO’s email and online storage accounts also revealed approximately 5,500 images and 267 videos of child pornography. The vast majority of these images and videos depicted prepubescent children under the age of 12.
MALDONADO has been detained since his arrest on June 8, 2012. On July 16, 2013, he pleaded guilty to one count of production of child pornography.
This matter was investigated by Homeland Security Investigations in Hartford, with the assistance of HSI in Philadelphia, the Connecticut State Police and the Hartford Police Department. The case was prosecuted by Assistant U.S. Attorneys Sarala V. Nagala and Anastasia E. King.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
To report cases of child exploitation, please visit www.cybertipline.com.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Gallant Pharma Company and Co-Owner Plead Guilty to Sixteen Charges of Prescription Drug FraudRead the Press Release
ALEXANDRIA, Va. – Gallant Pharma International Inc., headquartered in Arlington, Va., pleaded guilty today to two counts of importation fraud, five counts of selling misbranded drugs, and five counts of distributing prescription drugs without a license. Co-founder and co-owner Syed “Farhan” Huda, 38, of Arlington, Va., entered the guilty plea on behalf of Gallant Pharma, and he also pleaded guilty to one count each of importation fraud, selling misbranded drugs, distributing prescription drugs without a license, and wire fraud.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; Antoinette V. Henry, Special Agent in Charge of the Food and Drug Administration’s (FDA) Office of Criminal Investigations; Special Agent in Charge DEA Washington Division, Karl C. Colder; Gary Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; Acting Special Agent in Charge Scot R. Rittenberg for U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Washington, D.C.; and M. Douglas Scott, Arlington County Chief of Police, made the announcement after the pleas were accepted by United States District Judge Claude M. Hilton.
“Gallant Pharma exploited some of our most vulnerable citizens to make a profit, including those suffering from cancer and undergoing intravenous chemotherapy. We will prosecute these cases aggressively,” said Acting United States Attorney Boente. FDA Special Agent in Charge Henry added, “Gallant Pharma purchased drugs on the international black market, with no idea whose hands those drugs passed through or what conditions the drugs were stored or shipped in. FDA will continue to vigorously protect the health and safety of medical patients in the United States.”
In the statements of facts filed with the plea agreements, Huda and Gallant Pharma admitted that the company sold many “cold chain” drugs, which are subject to strict temperature controls to protect drug efficacy, and shipped and received those drugs with ice packs that sometimes melted, not with dry ice used by legitimate drug distributors. Many of the drugs sold by Gallant Pharma, including Botox, were required to contain a “black box” warning, the strongest warning issued by the FDA, which indicates that a drug has a significant risk of serious or life-threatening adverse effects. The versions sold by Gallant Pharma did not meet this or other FDA labeling requirements.
Huda is the eighth member of Gallant Pharma to enter a guilty plea in this prosecution. On October 15, 2013, Gallant Pharma co-founder and co-owner Talib Khan, 42, of Montreal, Canada and Barbados, pleaded guilty to selling misbranded chemotherapy and cosmetic drugs, and conspiracy to commit importation fraud, sell misbranded drugs, distribute prescription drugs without a license, and defraud the FDA. Four Gallant Pharma sales representatives and two office managers also have entered guilty pleas for their participation in this scheme.
Huda faces a maximum penalty of 53 years’ imprisonment when he is sentenced on March 28, 2014. Huda, a Canadian citizen, also faces deportation as a result of his conviction. A jury trial is scheduled for January 6, 2014, for alleged Gallant Pharma administrator (and wife of Huda) Deeba Mallick, 36, of Arlington, Va.; alleged supplier Mirwaiss Aminzada, 44, of Dubai, United Arab Emirates, and Montreal, Canada; and alleged drop-shipper and customer Anoushirvan Sarraf, 47, of Rockville, Md.
This case was investigated by FDA’s Office of Criminal Investigations, the Drug Enforcement Agency’s Group 33 Diversion Task Force, ICE, and the U.S. Postal Inspection Service, with assistance from the Arlington County Police Department. Assistant United States Attorneys Lindsay Kelly, Ryan K. Dickey, Jay V. Prabhu, and Maya Song are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Four Men Convicted in I-96 Cocaine SeizureRead the Press Release
The two out-of-state defendants sent to prison for 15 and 30 years.
GRAND RAPIDS, MICHIGAN – Four men have been convicted and two of them already sentenced in connection with the seizure of approximately three kilograms of cocaine and crack cocaine on I-96 in Ingham County, Michigan, Patrick A. Miles, U.S. Attorney for the Western District of Michigan announced today. Luis Edwards, the suspected source of the drugs, was sentenced on November 25 to fifteen years and eight months in prison. In August, Israel Mendez, a drug courier, was sentenced to thirty years in prison. The two men who were originally caught with the drugs near Lansing, Gilbert Albarez and Rogelio Ruiz, have now pled guilty and await sentencing.
The drug seizure took place on October 24, 2012, when an Ingham County deputy sheriff stopped a car on I-96 near Lansing, Michigan. Inside the car, the deputy found approximately three kilograms of cocaine and crack cocaine. The occupants of the car, Albarez, age 37, and Ruiz, age 42, both from Lansing, were subsequently indicted in federal court for possession of cocaine and crack cocaine with intent to distribute. Both of them pled guilty to that charge on November 13, 2013.
Investigative efforts by the FBI and the Tri-County Metro Narcotics Unit following the seizure revealed that Albarez and Ruiz had picked up the drugs in Columbus, Ohio, and were transporting them to Lansing when they were stopped. Law enforcement set up a reverse “sting” by arranging to return the drugs to their suspected source. On October 25, 2012, Mendez, from Ft. Wayne, Indiana, came to Lansing to retrieve the drugs and law enforcement promptly arrested him. Mendez was found guilty by a jury in April of possessing with intent to distribute the seized drugs. The Hon. Paul L. Maloney, Chief Judge, sentenced Mendez on August 19 to thirty years in prison based on his extensive criminal history.
Edwards, age 43, the suspected drug supplier, was arrested when he crossed the border from Mexico into the United States near Hidalgo, Texas, on March 22, 2013. He pled guilty to conspiracy to possess with intent to distribute the seized drugs in August, and Chief Judge Maloney sentenced him to 188 months in prison last week. Edwards is also subject to deportation at the conclusion of his sentence.
These convictions were the result of a Drug Task Force investigation in the Lansing, Michigan, area led by the FBI and the Tri-County Metro Narcotics Unit. The case was prosecuted by Assistant U.S. Attorney John Bruha.
END
Former Wichita Police Officer Sentenced in Scheme to Pay BribeRead the Press Release
WICHITA, KAN. - A former officer of the Wichita Police Department has been sentenced to a year on federal probation after pleading guilty in a scheme to pay a bribe as part of an unsuccessful effort to keep from losing her job, U.S. Attorney Barry Grissom.
Former officer Joletta Vallejo, 35, Wichita, Kan., pleaded guilty to one count of conspiracy to commit wire fraud. Vallejo was employed by the police department from Jan. 9, 2006, to Aug. 24, 2012. In her plea, she admitted that on Oct. 16, 2011, two citizens approached her to make a report that they were victims of an aggravated robbery, aggravated kidnaping, aggravated battery and attempted first degree murder. Vallejo did not follow the police department’s policies in responding and filing their complaints.
As a result of her failure to follow department policies, Vallejo was investigated by the police department’s Professional Standards Bureau. When she was interviewed she lied to the investigators. When she became aware she was going to be fired, she and co-defendant Patrick Melendrez devised a scheme to attempt to keep her job.
On Aug. 22, 2012, Vallejo created a Google Voice number in the name of Melendrez. They used that number to call and text one of the citizens and offer him money to recant the statements he had made to police about Vallejo’s conduct. The citizen’s response was part of an undercover investigation.
Co-defendant Patrick Melendrez was sentenced to two years on probation. Co-defendant Courtney Foster is awaiting trial
Grissom commended the Wichita Police Department, the FBI and Assistant U.S. Attorney Debra Barnett for their work on the case.
Former Northern Kentucky School Superintendent Admits Embezzling MoneyRead the Press Release
COVINGTON, KY - The former superintendent for the Dayton Independent School District has admitted in federal court to embezzling school funds during his tenure.
William Rye, 65, of Wilder, KY., pleaded guilty today to one count of embezzlement. Rye waived his right to be indicted by a federal grand jury and pleaded guilty to the embezzlement charge brought by U.S. Attorney Kerry B. Harvey.
In the course of his guilty plea, Rye admitted that, between 2004 and 2012, he embezzled approximately $193,149.22 from the Dayton Independent School District, while serving as school superintendent.
This case is eligible for federal prosecution because the Dayton School District annually receives in excess of $10,000 in federal funds.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, and Perrye Turner, Special Agent in Charge, Federal Bureau of Investigation, jointly made the announcement today.
The investigation was conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Laura K. Voorhees represents the US. Attorney’s Office in this case.
Rye is currently scheduled to appear for sentencing in Covington on April 22 at 11:00 am. Rye faces a maximum prison sentence of 10 years. However, any sentence would be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes governing the imposition of sentences.
Former NASA SES Employee Pleads Guilty to Conflict of Interest ViolationRead the Press Release
Orlando, Florida – Acting United States Attorney A. Lee Bentley, III announces that Edward J. Mango, (52, Orlando) today pleaded guilty to an Information charging him with acting in his official capacity while having a financial conflict of interest, a felony. Mango faces a maximum penalty of five years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, Mango was a Senior Executive Service employee, who worked for the National Aeronautics and Space Administration (NASA). In this capacity, he worked as the manager of the commercial crew program (CCP), at the Kennedy Space Center (KSC) in Brevard County.
In December 2012, state authorities arrested C.T., a NASA employee. Mango used a credit card advance to loan money to C.T. so that C.T. could retain legal counsel and pay for other expenses. As a result of additional state charges, C.T. was subjected to the NASA employee disciplinary process. Using official government e-mail, telephones, and other property, Mango intervened on C.T.’s behalf and improperly exerted his influence as an SES employee, in an effort to mitigate C.T.’s punishment. Mango contacted employees in human resources, the KSC center director, KSC human resources director, KSC protective services deputy chief, and other NASA employees in Washington, D.C., urging them to mitigate C.T.’s punishment. As a result of Mango’s improper actions, C.T. was spared discipline that would otherwise be appropriate for his/her acts. NASA employees later said that had they been aware of the financial relationship between Mango and C.T., they would not have entertained Mango’s contact on C.T.’s behalf. When interviewed by NASA Office of the Inspector General agents, Mango admitted to his actions.
This case was investigated by NASA Office of the Inspector General. It is being prosecuted by Assistant United States Attorney Vincent A. Citro.
- Plea Agreement
- Plea Agreement
Former KKK Leader Indicted for Cross Burning; Second KKK Member Indicted for PerjuryRead the Press Release
Montgomery, Alabama - Steven Joshua Dinkle, former Exalted Cyclops of a chapter of the Ku Klux Klan (KKK) in Ozark, Ala., was arrested on Wednesday, Nov. 27, in Mississippi for burning a cross at the entrance to a predominantly African-American neighborhood and for obstructing the investigation into the offense. Pamela Morris, Dinkle’s mother and the former secretary of the KKK chapter, was arrested on Nov. 21, 2013, for committing perjury before the grand jury investigating the cross burning.
Dinkle, 28, was charged in a five-count indictment returned by a federal grand jury in the Middle District of Alabama that was unsealed on Nov. 27. The indictment charges him with one count of conspiracy to violate housing rights, one count of criminal interference with the right to fair housing, one count of using fire to commit a federal felony and two counts of obstruction of justice.
The indictment alleges that on May 8, 2009, Dinkle conspired with another person to burn a cross in an African-American neighborhood to threaten and intimidate residents of that neighborhood and thereby interfere with their federally protected housing rights. Dinkle allegedly constructed a six-foot cross, wrapping jeans and a towel around it. He and his co-conspirator drove the cross to an African-American community near Johntown Road in Ozark where Dinkle poured fuel on the cross, erected it in the ground and set it on fire. The indictment further contends that Dinkle obstructed justice by lying to local investigators in 2009, and federal investigators in 2012. Dinkle claimed he had withdrawn from the KKK months before the cross burning, provided a false alibi and denied knowing a person who was, in fact, his superior in the KKK.
The grand jury returned a separate indictment against Morris, 45, charging her with two counts of perjury. The indictment alleges that Morris made multiple false statements to the grand jury investigating the cross burning when she denied her own involvement in the KKK and knowing that Dinkle was also involved.
If convicted, Dinkle could face a maximum statutory sentence of 10 years in prison and a $250,000 fine on the conspiracy and criminal-interference counts; sentence maximum of 10 years in prison for the use-of-fire; a maximum of 20 years in prison and a $250,000 fine for obstructing justice by making false statements to local investigators; and a maximum of five years in prison and a $250,000 fine for making false statements to the FBI.
If convicted, Morris could face a maximum statutory sentence of five years in prison and a $250,000 fine on each count of perjury.
An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty.
This case is being investigated by the FBI, with the assistance of the Dale County Sheriff’s Office and the Ozark Police Department. The case is being prosecuted by Assistant U.S. Attorney Jerusha T. Adams of the Middle District of Alabama and Trial Attorney Chiraag Bains of the Justice Department’s Civil Rights Division.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617Former Hospital Employee Sentenced in Connection with Widespread Hepatitis C OutbreakRead the Press Release
CONCORD, N.H. – David M. Kwiatkowski, 34, a former employee of Exeter Hospital, was sentenced today to 39 years in prison for his conduct in causing a widespread Hepatitis C outbreak in numerous states, announced United States Attorney John P. Kacavas and Barry R. Grissom, United States Attorney for the District of Kansas.
After working as a health care technician at several medical facilities in Michigan between 2003 and 2007, the defendant became a “traveling” radiologic technician, using various placement agencies to find employment at medical facilities in New York, Pennsylvania, Maryland, Arizona, Kansas, Georgia, and New Hampshire. While employed as a “traveler,” he stole syringes of Fentanyl – a powerful anesthetic to which he did not have authorized access – intended for patients undergoing certain medical procedures. He replaced the stolen syringes with syringes that he had stolen from previous procedures and refilled with saline, after having injected himself with the Fentanyl intended for his patients.
The defendant engaged in this diversion and tampering despite knowing that he was infected with Hepatitis C, a blood-borne virus that can cause serious damage to the liver as well as other complications. Precisely when he contracted the virus remains an open question. However, the defendant learned no later than June of 2010, while employed at Hays Medical Center in Kansas, that he was infected with Hepatitis C. Despite that knowledge, he continued to inject himself using stolen Fentanyl syringes, in the process causing those syringes to become tainted with his infected blood. He refilled those tainted syringes with saline and replaced them for use on unsuspecting patients undergoing subsequent procedures. Consequently, instead of receiving their prescribed dose of Fentanyl with its intended anesthetic effect, those patients actually received saline tainted with the defendant’s strain of the Hepatitis C virus.
As a “traveler,” the defendant worked in no fewer than eight different states and he engaged in this diversion and/or tampering in each of them. His criminal conduct only came to light when several unexplained cases of Hepatitis C were detected at Exeter Hospital in New Hampshire in May of 2012. That discovery triggered a massive public health investigation in which authorities in New Hampshire, other states in which the defendant had been employed, and the Centers for Disease Control and Prevention (CDC) sought to identify the scope of the defendant’s criminal conduct. All told, the CDC recommended that more than 12,000 patients seek testing to determine whether the defendant infected them. Testing to date has revealed that 32 patients who were treated at Exeter Hospital, six patients who were treated at Hays Medical Center in Kansas, six patients who were treated at Johns Hopkins Hospital in Maryland, and one patient who was treated at the VA Medical Center in Baltimore, Maryland carry a strain of Hepatitis C that has been genetically linked to the viral strain with which the defendant is infected.
An individual who has a personal relationship with one of the Exeter Hospital victims also has become infected with the same strain of the virus. Additionally, Hepatitis C contracted from the defendant has been identified as a contributing factor in the death of an elderly Kansas patient.
The defendant’s 40-year sentence was imposed on his pleas of guilty to eight counts of obtaining controlled substances by fraud and eight counts of tampering with a consumer product.
Fourteen of those charges were initiated in New Hampshire and two charges were transferred from the District of Kansas. This sentence is believed to be the highest sentence ever received for a crime of this nature.
United States Attorney John P. Kacavas said, “The 40-year sentence imposed today ensures that this serial infector will no longer be in position to harm innocent and vulnerable people, extinguishing once and for all the pernicious threat he posed to public health and safety. This prosecution surely heightened public awareness of the problem of drug diversion in medical settings, and the defendant’s convictions and sentence represent a major step forward in redressing the catastrophic consequences of his selfish and reckless behavior. While no sentence of incarceration can restore his victims to their former state of health, I hope that bringing this defendant to swift and certain justice will give them some peace of mind as they confront the uncertainty of living with the Hepatitis C virus.”
United States Attorney Barry R. Grissom said, “The defendant learned he had Hepatitis C while he was working at Hays Medical Center in Kansas. A patient in Kansas died and a medical examiner found that Hepatitis C contributed to the death. Many patients and their families still are living with the harm inflicted by the defendant’s reckless choices.”
Special Agent in Charge Vincent Lisi, of the Federal Bureau of Investigation, Boston Field Division said ,“This was a heinous crime that touched so many of us in New Hampshire and in several states throughout the country. When you go into a hospital for treatment, you should be able to trust that someone like the defendant will not steal pain medication intended for you and infect you with a deadly disease. We are pleased to see justice served today, and we hope this lengthy sentence will deter others who might be tempted to prey on vulnerable patients. We are grateful to all the Federal, State, and local investigating agencies that took part in this unprecedented investigation and to the leadership of both United States Attorney John Kacavas and Assistant United States Attorney John Farley who worked tirelessly to bring justice to the many victims in this case. Most of all, we are deeply thankful to the numerous victims who selflessly shared their time and extremely personal information with investigators under such difficult circumstances. They are the true heroes in this investigation. Though faced with difficult circumstances themselves, their extraordinary cooperation and information was the backbone for the investigation.”
“Patients put their trust in the safety of this country’s health care system,” said Phillip Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General region including New Hampshire. “When the reckless actions of Mr. Kwiatkowski compromised the safety of some patients in federally funded health care programs, we joined with our law enforcement partners to protect people from the defendant.”
In addition to his term of incarceration, the defendant will be placed on supervised release for three years following his release from prison. He also must pay a $1,600.00 special assessment and restitution in the amount of nearly $25,000.00.
This investigation involved the cooperative efforts of federal, state, and local law enforcement agencies, including the Federal Bureau of Investigation, the Office of Inspector General of the U.S. Department of Health and Human Services, the Drug Enforcement Administration, Office of Criminal Investigations of the Food and Drug Administration, the Office of Inspector General of the Department of Veterans Affairs, the New Hampshire Attorney General’s Office, the New Hampshire State Police, and the Exeter, New Hampshire Police Department. Assistance also was provided by the New Hampshire Drug Task Force, the Marlborough, Massachusetts Police Department, the Boxborough, Massachusetts Police Department, and the United States Attorney’s Offices in the District of Massachusetts, the District of Kansas, the District of Maryland, and the Middle District of Georgia. The case was prosecuted by Assistant U.S. Attorney John J. Farley. The Kansas aspects of the case were handled by Assistant U.S. Attorney Tanya Treadway.
Former Hays Waste Water Manager Sentenced for Violating Clean Water ActRead the Press Release
WICHITA, KAN. – A former waste water treatment superintendent for the City of Hays pleaded guilty and was sentenced Monday for violating the federal Clean Water Act, U.S. Attorney Barry Grissom said today.
Charles L. Blair, 58, Hays, Kan.,was sentenced to a year on federal probation and a $2,500 fine. Blair pleaded guilty to one misdemeanor count of negligent discharge of a pollutant. In his plea, he admitted that in February 2012 he negligently allowed for the discharge of effluent from the waste water treatment plant in Hays that contained an ammonia nitrogen level of 46.2 milligrams per liter. This level of ammonia nitrogen is in excess of both state and federal regulations.
Grissom commended the Environmental Protection Agency and Assistant U.S. Attorney Matt Treaster for their work on the case.
Former Governor of State of Tamaulipas, Mexico, Indicted in the Southern District of TexasRead the Press Release
BROWNSVILLE, Texas – A federal indictment charging Tomas Yarrington Ruvalcaba, the former governor of the State of Tamaulipas, Mexico, has been unsealed.
The unsealing was announced by United States Attorneys Kenneth Magidson and Robert L. Pitman, of the Southern and Western Districts of Texas, respectively, along with Janice Ayala, special agent in charge, Homeland Security Investigations (HSI); Javier Peña, special agent in charge, Drug Enforcement Administration (DEA); Bernard Butler, acting special agent in charge, Internal Revenue Service - Criminal Investigation (IRS-CI); and Armando Fernandez, special agent in charge, FBI.
Following an investigation that spanned several years, the sealed indictment was returned in May 2013 by a federal grand jury sitting in Brownsville. The indictment charges Yarrington, 56, and Fernando Alejandro Cano Martinez, 57, the owner of a Mexican construction firm, with conspiring to violate the provisions of the Racketeer Influenced and Corrupt Organization (RICO) statute. The two men are also charged with conspiracy to launder money, conspiracy to defraud and conspiracy to make false statements to federally insured U.S. banks.
Yarrington is also separately charged with a conspiracy to violate the provisions of the Controlled Substances Act, two substantive bank fraud charges and a conspiracy to structure currency transactions at a domestic financial institution, while Cano is separately charged with three counts of bank fraud.
Yarrington served as governor of Tamaulipas from 1999 to 2004. Tamaulipas lies along the southern border between the United States and Mexico directly across from Brownsville and Laredo.
According to the indictment, beginning in approximately 1998, Yarrington received large bribes from major drug traffickers operating in the Mexican state of Tamaulipas, including the Gulf Cartel. In return, Yarrington allegedly allowed them to operate their large scale, multi-ton enterprises freely, which included the smuggling of large quantities of drugs to the United States for distribution. From 2007 to 2009, Yarrington allegedly became involved in the smuggling of large amounts of cocaine through the Port of Veracruz into the United States.
Yarrington also allegedly collected bribes from commercial operations in Mexico, according to the indictment. Cano operated Materiales y Construcciones Villa de Aguayo, S.A. de C.V., a construction firm in Tamaulipas that received significant public works contracts during Yarrington’s term as governor. The indictment alleges Cano, in turn, paid bribes to Yarrington to include the acquisition of real estate in front names for him.
The indictment further alleges Yarrington also received control over stolen public funds in the latter part of 2004. Portions of those funds were allegedly used to buy a Sabreliner 60 airplane in January 2005. As part of that purchase, $300,000 was transferred to a bank account in the United States. Another portion of the allegedly stolen funds, $5 million Mexican pesos, was transferred to Cano in the spring of 2005, according to the indictment.
The indictment further alleges that starting in approximately 1998, Yarrington, and later to include Cano, became involved in the acquisition of valuable assets in the United States, using front names and business entities established starting in 2005 to disguise the true ownership of the assets. The assets allegedly included bank accounts, residences, airplanes, vehicles and real estate in Bexar, Cameron, Hidalgo and Hays Counties, many of which were acquired via allegedly fraudulent loans from banks in Texas. According to the indictment, bank accounts established in front names at Texas banks were used to receive and disburse money to carry the ongoing costs of the assets, such as loan costs and condo fees.
The indictment identifies numerous specific front entities involved in the scheme, each of which allegedly applied for multi-million dollar fraudulent loans at Texas banks, which Cano allegedly personally guaranteed. The indictment details a total of more than $7 million in transfers into the U.S. accounts of the front entities.
Additional entities were created and used to apply for other loans to fund the purchase of still other assets, according to the indictment. Numerous currency transactions were allegedly conducted at First National Bank, headquartered in Edinburg, Texas, in a structured manner in amounts at or below $10,000 in order to evade the filing of Currency Transaction Reports by the bank.
Neither Yarrington nor Cano is in the custody of the United States and warrants remain outstanding for their arrests. Anyone with information about their whereabouts is asked to contact Homeland Security Investigations at 956-542-5811. Persons calling from Mexico should call 001-800-010-5237.
The RICO and money laundering charges each carry sentences of up to 20 years in prison, while conspiracy to commit bank fraud carries as possible punishment up to 30 years. The drug conspiracy charges carry a term of imprisonment of at least 10 years. The currency structuring charges carry a possible five-year-term of imprisonment.
The indictment also includes a notice of forfeiture. Some of the assets identified in the indictment already have been seized by the United States in civil forfeiture actions over the course of the investigation, to include approximately 46 acres in Bexar County, a condo on South Padre Island, a 2005 Pilatus airplane and residences in Hidalgo and Hays counties.
The investigation leading to the indictment has been conducted by the Organized Crime Drug Enforcement Task Force in Brownsville, San Antonio, Houston, Corpus Christi and New York and has included agents and officers with HSI, DEA, IRS-CI, FBI and the Texas Attorney General’s Office. The United States government also acknowledges with gratitude the significant assistance received from the government of Mexico in the course of this investigation, including through sharing evidence and expertise.
The case is being prosecuted by Assistant United States Attorneys Charles Lewis, Julie K. Hampton and Jody Young.
Former Employee of Two Government Contractors Pleads Guilty to Role in Procurement Fraud Scheme Involving over $33 Million in Federal ContractsRead the Press Release
ALEXANDRIA, Va. – Anthony R. Bilby, 40, of Leesburg, Va., pleaded guilty today to conspiracy to commit wire fraud and major government fraud.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; Charles K. Edwards, Deputy Inspector General for the Department of Homeland Security (DHS); Brian D. Miller, General Services Administration (GSA) Inspector General; Peggy E. Gustafson, Small Business Administration (SBA) Inspector General; and Kim Lampkins, Special Agent in Charge, Department of Veterans Affairs (VA), Office of Inspector General, made the announcement after the plea was accepted by United States District Judge Anthony J. Trenga.
Bilby faces a maximum penalty of five years in prison when he is sentenced on February 21, 2014. He has agreed to forfeit $1,065,103.90, representing his personal proceeds from the conspiracy.
In a statement of facts filed with the plea agreement, Bilby admitted that from April 2007 through November 2012, while he was employed by two service-disabled veteran-owned small businesses, he participated in a conspiracy to obtain government contracts through fraud and misrepresentation. During this time period, Bilby caused employees at a nominal competitor to submit inflated bids on the same procurements for which Bilby submitted bids on behalf of his employers. Bilby also gained improper access to the procurement process through co-conspirators working within the government. These co-conspirators provided Bilby and others with internal government cost estimates, so that Bilby knew how much the government was willing to pay before he drafted his and his competitor’s bids. Bilby also drafted portions of internal procurement documents in a manner that increased his odds of winning contracts without facing actual competition.
One of Bilby’s employers, with Bilby’s knowledge and assent, agreed to pay ten percent of its profits on a contract worth more than $24 million to co-conspirators within the government. These co-conspirators, in turn, provided Bilby and his employer with improper access to documents and a competitive advantage in obtaining the contract. In total, the conduct of Bilby and others resulted in the award of more than $33 million in federal contracts through fraudulent procurement practices.
As part of his plea agreement, Bilby has agreed to cooperate in the investigation of others involved in the conspiracy. Another co-conspirator, Thomas S. Flynn, pleaded guilty on October 2, 2013.
This case was investigated by the Offices of the Inspector General for DHS, GSA, SBA, and the VA, with assistance from DHS’s Office of the Chief Security Officer, Cyber Forensic Branch. Assistant United States Attorney Kosta S. Stojilkovic is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Former Employee of Exeter Hospital Sentenced in Connection with Widespread Hepatitis C OutbreakRead the Press Release
CONCORD, N.H. – David M. Kwiatkowski, 34, a former employee of Exeter Hospital, was sentenced today to 39 years in prison for his conduct in causing a widespread Hepatitis C outbreak in numerous states, announced United States Attorney John P. Kacavas and Barry R. Grissom, United States Attorney for the District of Kansas.
After working as a health care technician at several medical facilities in Michigan between 2003 and 2007, the defendant became a “traveling” radiologic technician, using various placement agencies to find employment at medical facilities in New York, Pennsylvania, Maryland, Arizona, Kansas, Georgia, and New Hampshire. While employed as a “traveler,” he stole syringes of Fentanyl – a powerful anesthetic to which he did not have authorized access – intended for patients undergoing certain medical procedures. He replaced the stolen syringes with syringes that he had stolen from previous procedures and refilled with saline, after having injected himself with the Fentanyl intended for his patients.
The defendant engaged in this diversion and tampering despite knowing that he was infected with Hepatitis C, a blood-borne virus that can cause serious damage to the liver as well as other complications. Precisely when he contracted the virus remains an open question. However, the defendant learned no later than June of 2010, while employed at Hays Medical Center in Kansas, that he was infected with Hepatitis C. Despite that knowledge, he continued to inject himself using stolen Fentanyl syringes, in the process causing those syringes to become tainted with his infected blood. He refilled those tainted syringes with saline and replaced them for use on unsuspecting patients undergoing subsequent procedures. Consequently, instead of receiving their prescribed dose of Fentanyl with its intended anesthetic effect, those patients actually received saline tainted with the defendant’s strain of the Hepatitis C virus.
As a “traveler,” the defendant worked in no fewer than eight different states and he engaged in this diversion and/or tampering in each of them. His criminal conduct only came to light when several unexplained cases of Hepatitis C were detected at Exeter Hospital in New Hampshire in May of 2012. That discovery triggered a massive public health investigation in which authorities in New Hampshire, other states in which the defendant had been employed, and the Centers for Disease Control and Prevention (CDC) sought to identify the scope of the defendant’s criminal conduct. All told, the CDC recommended that more than 12,000 patients seek testing to determine whether the defendant infected them. Testing to date has revealed that 32 patients who were treated at Exeter Hospital, six patients who were treated at Hays Medical Center in Kansas, six patients who were treated at Johns Hopkins Hospital in Maryland, and one patient who was treated at the VA Medical Center in Baltimore, Maryland carry a strain of Hepatitis C that has been genetically linked to the viral strain with which the defendant is infected.
An individual who has a personal relationship with one of the Exeter Hospital victims also has become infected with the same strain of the virus. Additionally, Hepatitis C contracted from the defendant has been identified as a contributing factor in the death of an elderly Kansas patient.
The defendant’s 40-year sentence was imposed on his pleas of guilty to eight counts of obtaining controlled substances by fraud and eight counts of tampering with a consumer product. Fourteen of those charges were initiated in New Hampshire and two charges were transferred from the District of Kansas. This sentence is believed to be the highest sentence ever received for a crime of this nature.
United States Attorney John P. Kacavas said, “The 40-year sentence imposed today ensures that this serial infector will no longer be in position to harm innocent and vulnerable people, extinguishing once and for all the pernicious threat he posed to public health and safety. This prosecution surely heightened public awareness of the problem of drug diversion in medical settings, and the defendant’s convictions and sentence represent a major step forward in redressing the catastrophic consequences of his selfish and reckless behavior. While no sentence of incarceration can restore his victims to their former state of health, I hope that bringing this defendant to swift and certain justice will give them some peace of mind as they confront the uncertainty of living with the Hepatitis C virus.”
United States Attorney Barry R. Grissom said, “The defendant learned he had Hepatitis C while he was working at Hays Medical Center in Kansas. A patient in Kansas died and a medical examiner found that Hepatitis C contributed to the death. Many patients and their families still are living with the harm inflicted by the defendant’s reckless choices.”
Special Agent in Charge Vincent Lisi, of the Federal Bureau of Investigation, Boston Field Division said ,“This was a heinous crime that touched so many of us in New Hampshire and in several states throughout the country. When you go into a hospital for treatment, you should be able to trust that someone like DAVID KWIATKOWSKI will not steal pain medication intended for you and infect you with a deadly disease. We are pleased to see justice served today, and we hope this lengthy sentence will deter others who might be tempted to prey on vulnerable patients. We are grateful to all the Federal, State, and local investigating agencies that took part in this unprecedented investigation and to the leadership of both United States Attorney John Kacavas and Assistant United States Attorney John Farley who worked tirelessly to bring justice to the many victims in this case. Most of all, we are deeply thankful to the numerous victims who selflessly shared their time and extremely personal information with investigators under such difficult circumstances. They are the true heroes in this investigation. Though faced with difficult circumstances themselves, their extraordinary cooperation and information was the backbone for the investigation.”
“Patients put their trust in the safety of this country’s health care system,” said Phillip Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General region including New Hampshire. “When the reckless actions of Mr. Kwiatkowski compromised the safety of some patients in federally funded health care programs, we joined with our law enforcement partners to protect people from the defendant.”
In addition to his term of incarceration, the defendant will be placed on supervised release for three years following his release from prison. He also must pay a $1,600.00 special assessment and restitution in the amount of nearly $25,000.00.
This investigation involved the cooperative efforts of federal, state, and local law enforcement agencies, including the Federal Bureau of Investigation, the Office of Inspector General of the U.S. Department of Health and Human Services, the Drug Enforcement Administration, Office of Criminal Investigations of the Food and Drug Administration, the Office of Inspector General of the Department of Veterans Affairs, the New Hampshire Attorney General’s Office, the New Hampshire State Police, and the Exeter, New Hampshire Police Department. Assistance also was provided by the New Hampshire Drug Task Force, the Marlborough, Massachusetts Police Department, the Boxborough, Massachusetts Police Department, and the United States Attorney’s Offices in the District of Massachusetts, the District of Kansas, the District of Maryland, and the Middle District of Georgia. The case was prosecuted by Assistant U.S. Attorney John J. Farley. The Kansas aspects of the case were handled by Assistant U.S. Attorney Tanya Treadway.
Five Dallas Men Sentenced for Various Roles in Hydroponic Marijuana Growing OperationRead the Press Release
DALLAS — Today, Louis Michael Olerio, Jr., 36, of Dallas, was sentenced to 24 months in federal prison, following his guilty plea in October 2012 to conspiracy to commit money laundering, stemming from his role in a hydroponic marijuana growing operation. Five other defendants charged in the case also pleaded guilty to various felony offenses and received sentences of 18 months to 36 months, as noted below. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
The other five defendants convicted and their sentences are:
Brian Edward Deloney, 37, 18 months
Jeremy Cash McElroy, 37, 36 months
Eric Irving Love, 35, 30 months
Jeffrey Scott Gannon, 34, 27 months
Stephen Ray Willeford, Jr., 39, 24 months
McElroy also pleaded guilty to conspiracy to commit money laundering. Love and Gannon pleaded guilty to conspiracy to maintain drug involved premises and Deloney pleaded guilty to maintaining a drug involved premise.
According to documents filed in the case, McElroy, Olerio, Gannon, and Love were fraternity brothers at Southern Methodist University (SMU) in the past. Between 2004 and June 2010, the defendants conspired to maintain 11 houses, in Dallas and Richardson, Texas, to cultivate and distribute highly potent hydroponic marijuana. Almost all of the marijuana grown at these houses by the defendants was ultimately delivered to Deloney for distribution.
After having grown marijuana with Olerio at one of the houses for numerous cycles, McElroy decided to distance himself from the day-to-day operations of the conspiracy and agreed to sell two of the marijuana grow houses to Olerio, while retaining a percentage of the proceeds in the sale of marijuana grown in those houses. To that end, McElroy transferred the deed for one of the houses to Olerio and sold another one of the grow houses to Olerio, leaving the marijuana grow equipment in both houses so that Olerio could continue to growing operation in them. Olerio agreed to continue the operation in these houses and pay McElroy twenty percent of the profits from the sale of the marijuana. McElroy and Olerio conducted financial transactions with the intent to conceal any ownership McElroy had in the profits from the marijuana sales.
The case was investigated by the Internal Revenue Service - Criminal Investigations and the Drug Enforcement Administration. Deputy Criminal Chief Assistant U.S. Attorney Jay Dewald was in charge of the prosecution.
Ex-Social Security Employee Sentenced to Prison for ExtortionRead the Press Release
ATLANTA - Cordell Fleming, a former Claims Representative with the Social Security Administration, has been sentenced to one year and one day in prison for extortion.
“Mr. Fleming abused his position of public trust with the Social Security Administration when he extorted money from the disabled, aged, and indigent, in return for expediting their claims” said United States Attorney Sally Quillian Yates. “The defendant earned every day of this prison sentence.”
“While employee fraud is rare in SSA’s dedicated work force, the Office of the Inspector General has no higher priority than the investigation and prosecution of the rare individual who violates the public trust. I’m pleased to see this case brought to a successful conclusion and grateful that the U.S. Attorney’s Office shares our determination to ensure the integrity of SSA’s programs,” said Thomas Caul, Special Agent in Charge, Office of the Inspector General for the Social Security Administration.
According to United States Attorney Yates, the charges and other information presented in court: Fleming worked as a Claims Representative for the Social Security Administration in Morrow, Ga. As part of his duties, Fleming processed requests for Supplemental Security Income (SSI) payments for eligible individuals. SSI is a Federal income supplement program designed to help aged, blind, and disabled people, who have little or no income, by providing cash to meet basic needs for food, clothing, and shelter. As part of his scheme, Fleming offered to “expedite” the processing time of SSI payments to recipients in exchange for a fee. In an attempt to make the expedited SSI payments appear legitimate, Fleming frequently created false documents that purportedly justified the expedited disbursement of the payments. From October 2012 to April 2013, Fleming extorted and attempted to extort money (in amounts ranging from approximately $500 to $1,800) from at least nine SSI recipients or their representatives.
On August 27, 2013, Fleming, 47, of Conyers, Ga., pleaded guilty to Extortion under the Color of Official Right. Today, United States District Judge Timothy C. Batten, Sr. sentenced Fleming to one year and one day in prison to be followed by three years of supervised release, and full restitution. He was also ordered to perform 120 hours of community service.
This case was investigated by Special Agents of the Social Security Administration - Office of the Inspector General.
Special Assistant United States Attorney Diane C. Schulman and Assistant United States Attorney Jeffrey W. Davis prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia is www.justice.gov/usao/gan.
District Man Found Guilty of Manslaughter in Stabbing Death of Fellow Marine-Attack Took Place in April 2012 in Southwest Washington-Read the Press Release
WASHINGTON – Michael Poth, 22, of Washington, D.C., was found guilty by a jury today of manslaughter while armed in the fatal stabbing of a fellow U.S. Marine Corps enlistee, U.S. Attorney Ronald C. Machen Jr. announced.
Poth was found guilty following a trial in the Superior Court of the District of Columbia. The Honorable Russell F. Canan scheduled sentencing for Feb. 7, 2014. The charge carries a statutory maximum of 60 years in prison.
According to the government’s evidence, Poth and the victim, Philip Bushong, 24, were active duty U.S. Marine Corps enlistees. At the time of the incident, the defendant was a private first class and was assigned to the Marine Barracks Washington, while the victim, a lance corporal, was a few days away from receiving an honorable discharge and was in the District of Columbia visiting friends. The men did not know one another. In the early morning hours of April 21, 2012, both were in the area near the 700 block of Eighth Street SE, near the Marine Barracks. Multiple bars and restaurants are in the area.
Poth walked by Lance Cpl. Bushong, who was with a group of friends. Shortly after he passed by the group, Lance Cpl. Bushong yelled something at the defendant. Poth took offense, took out a small pocket knife from his pocket, and waved it in the air toward Lance Cpl. Bushong and his group of friends. Poth also muttered out loud that he was going to “cut someone’s (expletive) lungs out.”
About 10 minutes later, Poth, after circling the block, aggressively walked toward Lance Cpl. Bushong, who was still in the area talking to a friend. Poth walked up to Lance Cpl. Bushong, uttered an anti-gay slur, and then kept walking. Lance Cpl. Bushong proceeded to follow Poth, and the two began to argue. As Lance Cpl. Bushong drew back his fist to punch Poth, Poth stated, “I’m going to stab you.” He then drew his knife and stabbed Lance Cpl. Bushong once in chest. Lance Cpl. Bushong died about two hours later.
“Today a District of Columbia jury held Michael Poth accountable for stabbing a fellow Marine to death on a public street near their barracks,” said U.S. Attorney Machen. “Their guilty verdict makes clear that our community will not tolerate the deadly violence that so often arises from petty disputes. We hope that this decision brings some measure of comfort to the family and friends of the young Marine killed that night.”
In announcing the verdict, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department and the Naval Criminal Investigative Service, and thanked the U.S. Marine Corps for their cooperation. He also expressed appreciation for the work of the District of Columbia Department of Forensic Sciences and the District of Columbia Office of the Chief Medical Examiner. In addition, he acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Sandra Lane and Alesha Matthews; Victim/Witness Advocate Tamara Ince; David Foster, Katina Adams-Washington, and La June Thames, all of the Victim Witness Assistance Unit, and Litigation Technology Specialists Will Henderson and Paul Howell. Finally, he praised Assistant U.S. Attorney Michael Liebman, who prosecuted the case.
13-409Cumberland County Child Sex Trafficker Sentenced to 540 MonthsRead the Press Release
RALEIGH - United States Attorney Thomas G. Walker announced that in federal court today CHRISTOPHER JASON WILLIAMS, 33, of Fayetteville, North Carolina was sentenced by Chief United States District Judge James C. Dever, III, to 540 months imprisonment followed by a lifetime of supervised release. WILLIAMS previously pled guilty on July 15, 2013 to two counts of Sex Trafficking of Children, in violation of Title 18, United States Code Section 1591.
U.S. Attorney Thomas G. Walker stated, “Sex Trafficking, particularly of children, will not be tolerated in our community, and the U.S. Attorney’s Office will continue to work with our partners in law enforcement to ensure that individuals who commit these crimes are found and convicted.”
WILLIAMS’ crimes were first uncovered in January of this year when a young girl reported to police that she and another child had been held against their will by the defendant and forced to perform sex acts for money. At the time of the report, she had been able to escape but was fearful for her friend, who remained in WILLIAMS’ custody. Detectives with the Fayetteville Police Department responded to WILLIAMS’ apartment and eventually located the second victim locked in his attic crawl space.
Upon interviewing the girls, detectives learned that WILLIAMS had kept them captive for weeks and months, respectively, beating them and threatening to kill them and their family members if they attempted to escape. During this time, WILLIAMS posted partially nude photographs of the girls on various websites, advertising them for sex. Men were directed to WILLIAMS’ apartment, where the girls were forced to have sex with them for money. WILLIAMS forced both girls to have sex with him. He also made them perform sexual acts on him while recording it on video.
Once WILLIAMS was arrested, a forensic examination of his cell phone revealed hundreds of images of child pornography, many of which depicted the girls and were created by the defendant himself.
This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.Investigation of this case was conducted by the Fayetteville Police Department. Assistant United States Attorney Leslie Cooley prosecuted the case for the United States.
Conspirator Pleads Guilty in Fraudulent Tax Refund SchemeRead the Press Release
Loss to the Government of $546,785 as a Result of the Scheme
Baltimore, Maryland – Tonia Patrice Lawson, age 43, of Middle River, Maryland, pleaded guilty today to a conspiracy to obtain fraudulent tax refunds.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein, Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office; and Special Agent in Charge Kathryn Jones, U.S. Department of Transportation, Office of Inspector General, Washington Regional Office.
“Return preparer fraud is a priority for IRS Criminal Investigation and we are committed to working with our law enforcement partners to investigate and prosecute cases just like these,” said Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington DC Field Office. “Today's plea hearing is a reminder that individuals, like Ms. Lawson, who conspire to prepare fraudulent tax returns, will be brought to justice.”
According to Lawson’s plea agreement, from February 2010 through April 2013, Lawson, who was unemployed, conspired with others to prepare fraudulent tax returns. Specifically, Lawson and others recruited individuals who ordinarily did not meet the threshold to file income tax returns, because they had little or no earned income, and convinced these individuals that they could obtain a substantial refund and therefore should file a federal individual income tax return. Lawson and her co-conspirators used a variety of methods to recruit these individuals, including paying referral fee to those who brought recruits to them. Lawson would collect the recruits’ personal information and provide it to the conspirator who would prepare the fraudulent return. The recruits did not provide any income information. Once the refund from the fraudulent tax return was received, Lawson and the conspirators took a portion of the refund and paid the recruit a smaller amount. The conspirators misled the recruits by telling them that the refunds they had received were smaller than the refund amounts listed on the fraudulent tax returns. At least 15 fraudulently obtained tax refunds were deposited directly into accounts controlled by Lawson, who then wrote checks to the recruits to pay them for their portion of the refund.
Over the course of the scheme, Lawson conspired in the filing of 84 fraudulent tax returns with a resulting loss to the government of $546,785.
Lawson faces a maximum sentence of 10 years in prison and a fine of $250,000 or twice the gross gain or loss caused by the offense, whichever is greater. U.S. District Judge Richard D. Bennett scheduled her sentencing for March 27, 2014 at 4:00 p.m.
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 praised IRS Criminal Investigation and DOT-OIG for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Gregory R. Bockin, who is prosecuting the case.
Clinic Manager Pleads Guilty to Receiving Misbranded BotoxRead the Press Release
St. Louis, MO - THOMAS GREG MARTIN pled guilty to receiving misbranded Botox® from a foreign unlicensed drug wholesaler, some of which had counterfeit exterior packaging.
According to court documents, Martin operated Aestheticare LLC, a medical clinic which provided assorted cosmetic procedures to patients in St. Louis County, Missouri. In March 2010, Martin received a facsimile transmission from an unlicensed drug wholesaler that offered low prices for assorted prescription drugs, including "Botox (Turkish)" for $344.99 a vial. During this same time frame, the FDA-approved version of Botox® was sold through licensed drug wholesales at higher prices in the United States, typically $525 a vial. From March 2010 through September 2012, Martin made over thirty separate purchases of these drugs from the unlicensed drug wholesaler. Ultimately, Martin and others provided the illegal drugs to the clinic’s patients without informing them of the source of the drugs. The U.S. Food and Drug Administration has recently issued a public safety alert regarding misbranded Botox®, found on the agency’s website at: http://www.fda.gov/drugs/drugsafety/ucm349503.htm.
Martin, St. Louis, Missouri, pled guilty to one felony charge of receiving misbranded drugs before United States District Judge Rodney Sippel. Sentencing has been set for March 7, 2014.
Martin faces a maximum penalty of three years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the U.S. Food and Drug Administration, Office of Criminal Investigations.
CVS’ Caremark Will Pay $4.25 Million<br /> for Allegedly Denying Medicaid Claims for Reimbursement of Prescription Drug CostsRead the Press Release
Caremark LLC, a pharmacy benefit management company (PBM), will pay the government and five states a total of $4.25 million to settle allegations that it knowingly failed to reimburse Medicaid for prescription drug costs paid on behalf of Medicaid beneficiaries, who also were eligible for drug benefits under Caremark-administered private health plans, the Justice Department announced today. Caremark is operated by CVS Caremark Corp., one of the largest PBMs and retail pharmacies in the country. A PBM administers and manages the drug benefits for clients who offer drug benefits under a health insurance plan.
Under the terms of the agreement, the government will receive approximately $2.31 million. In addition, five states -- Arkansas, California, Delaware, Louisiana and Massachusetts -- will share $1.94 million.
“It is vitally important that cash-strapped Medicaid programs receive reimbursement for costs they incur that should have been paid for by other insurers,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “We will take action against those who seek to gain at the expense of Medicaid or other federal health care programs.”
Caremark served as the PBM for private health plans that insured a number of individuals receiving prescription drug benefits under both a Caremark-administered plan and Medicaid. When an individual is covered by both Medicaid and a private health plan, the individual is called a “dual eligible.” Under the law, the private insurer, rather than the government, must assume the costs of health care for dual eligibles. If Medicaid erroneously pays for the prescription claim of a dual eligible, Medicaid is entitled to seek reimbursement from the private insurer or its PBM, in this case Caremark.
According to the government, Caremark allegedly used a computer claims processing platform called “Quantum Leap” to cancel claims for reimbursement submitted by Medicaid for dual eligibles. The government alleged that Caremark’s actions caused Medicaid to incur prescription drug costs for dual eligibles that should have been paid for by the Caremark-administered private health plans rather than Medicaid.
The allegations settled today arose from a lawsuit filed by Janaki Ramadoss, a former Caremark quality assurance representative, under the qui tam, or whistleblower, provisions of the False Claims Act. Under the Act, private citizens can bring suit on behalf of the government for false claims and share in any recovery. The Act also allows the government to intervene in the lawsuit, as it has done in this case. Ramadoss will receive approximately $505,680 from the federal government’s share of the settlement. Ramadoss also will receive additional amounts from the settling states.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.1 billion of that amount recovered in cases involving fraud against federal health care programs.
This case was jointly litigated by the U.S. Attorney’s Office for the Western District of
Texas; the Justice Department’s Civil Division, Commercial Litigation Branch; and the attorneys general for the states of Arkansas, California and Louisiana.The case is captioned United States ex rel. Ramadoss v. CVS Caremark Inc., SA-12-CA-929WRF (W.D. Texas). The claims settled by this agreement are allegations only; there has been no determination of liability.
Boise Woman Pleads Guilty to Conspiring to Distribute MethRead the Press Release
BOISE – Bobbi Eileen Woolsey, 35, of Boise, pleaded guilty today in United States District Court to conspiring to distribute methamphetamine, U.S. Attorney Wendy J. Olson announced.
A federal grand jury indicted Woolsey and ten other defendants on July 9, 2013. The superseding indictment alleges that Woolsey and ten other co-conspirators agreed to distribute methamphetamine. It also alleges that several co-conspirators distributed methamphetamine, unlawfully possessed firearms, and brandished and discharged a firearm in furtherance of the drug conspiracy.
Woolsey is scheduled to be sentenced on February 25, 2013, by U.S. District Judge Edward J. Lodge at the federal courthouse in Boise. Three other defendants have pleaded guilty and are set for sentencing on February 24, 2013.
The charge of conspiracy to distribute methamphetamine is punishable by up to life imprisonment, a maximum fine of $10 million, and a minimum term of five years of supervised release.
The case was investigated by the Drug Enforcement Administration, the Nampa Police Department, and the Treasure Valley Metro Violent Crime Task Force. The task force is comprised of federal, state and local agencies, including the Boise Police Department, Ada County Sheriff’s Office, Caldwell Police Department, Nampa Police Department, Meridian Police Department, Canyon County Sheriff’s Office, and the Idaho Department of Probation and Parole.
The case is being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Asheboro Resident Pleads to Federal Program FraudRead the Press Release
GREENSBORO, N.C. –TIFFANIE ANNETTE WILSON of Asheboro, North Carolina, pleaded guilty today to a felony fraud charge in federal court in Greensboro, announced Ripley Rand, United States Attorney for the Middle District of North Carolina.
WILSON, age 38, pleaded guilty to felony charges of both conspiracy to embezzle money and embezzling money from an organization receiving federal funds. Wilson was the Director of the Weatherization Assistance Program for Regional Consolidated Services [RCS]. RCS is an Asheboro nonprofit organization that during WILSON’s leadership administered a federally-funded program to help low-income North Carolinians save energy and reduce utility costs through making homes more energy efficient.
WILSON pleaded guilty to conspiring to embezzle and embezzling funds from RCS. According to court documents, WILSON’s embezzlement resulted in a loss of between $300,000.00 and $400,000.00 to the federal program.
WILSON faces a maximum penalty of ten years confinement in federal prison for the fraud convictions. The plea agreement also requires WILSON to make restitution. Sentencing will occur in Greensboro on March 11, 2014, before Chief United States District Judge William L. Osteen, Jr.
The case was investigated by the Federal Bureau of Investigation, the Department of Energy/Office of Inspector General, and the North Carolina State Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Robert M. Hamilton.
Albuquerque Man Pleads Guilty to Federal Methamphetamine Trafficking ChargeRead the Press Release
ALBUQUERQUE – Deluvino Elias Salazar, 30, of Albuquerque, N.M., pleaded guilty this morning to an indictment charging him with possession of methamphetamine with intent to distribute under a plea agreement that requires the imposition of a 135-month prison sentence.
Salazar was arrested on Oct. 7, 2012, as the result of a law enforcement operation by agents of Homeland Security Investigations (HSI) and officers of the Albuquerque Police Department’s Westside Narcotics Unit. During the operation, officers observed Salazar place a plastic bag into a vehicle and get into the front passenger seat. Shortly thereafter, the officers executed a traffic stop on the vehicle and seized the plastic bag, which held three plastic containers filled with methamphetamine.
In his plea agreement, Salazar admitted that on Oct. 7, 2012, he met with an individual who, unbeknownst to him, was a confidential informant with the intention of distributing methamphetamine to him. Salazar further admitted bringing a plastic bag holding three plastic containers which contained methamphetamine to the meeting. Salazar also acknowledged that a forensic chemist determined that the plastic containers held an aggregate of 1330.89 grams of methamphetamine, including 998.16 grams of pure methamphetamine.
This case was investigated by the Albuquerque office of HSI and the Albuquerque Police Department, and is being prosecuted by Assistant U.S. Attorneys Holland S. Kastrin and Novaline D. Wilson.Alabama Man Sentenced to Federal Prison for Stolen Identity Tax Refund Fraud SchemeRead the Press Release
Clarence Hicks, of Montgomery, Ala., was sentenced to serve 57 months in federal prison and three years of supervised release and ordered to pay $210,555.62 in restitution for his role in a stolen identity refund fraud scheme, announced Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama. Hicks had previously pleaded guilty to filing a false claim for a federal tax refund and to aggravated identity theft.
According to court documents, Hicks had access to an Internal Revenue Service (IRS) Electronic Filing Identification Number assigned to another person and used that number to file false federal income tax returns in the names of stolen identities. The court found that Hicks intended to steal more than $300,000 from the IRS, which paid out $210,555.62 in false claims based on fraudulent returns Hicks filed.
This case was investigated by special agents of the Internal Revenue Service - Criminal Investigation. Trial Attorneys Justin Gelfand and Jason Poole of the department's Tax Division prosecuted the case.
Additional information about the department's Tax Division and its enforcement efforts may be found at www.justice.gov/tax
2 Houston Men Convicted of Humble Bank RobberyRead the Press Release
HOUSTON – Justin Devon Hayes, 23, and Demontray Ward, 21, both of Houston, have entered guilty pleas to aggravated bank robbery and brandishing a firearm during a crime of violence, announced United States Attorney Kenneth Magidson.
On April 26, 2013, Hayes, Ward and a third, now deceased man, robbed the Regions Bank at 7044 East FM 1960 in Humble. Ward was armed with a shotgun, while the other two had pistols. All of the weapons were loaded. The defendants demanded money, threatened the tellers and became agitated when they realized the vault was on a 10-minute timer.
A Houston police officer entered the bank, but was disarmed by Ward. Outside, another officer witnessed the three men leave the bank and enter an SUV. He attempted to confront them, but the vehicle drove towards him. Seeing a muzzle of a shotgun pointed at him, the officer fired and the driver was shot and killed. Ward and Hayes were then taken into custody.
U.S. District Judge Vanessa Gilmore, who accepted the guilty pleas, has set sentencing for Spring 2014, at which time they face up to 25 years for the bank robbery as well as a consecutive seven years for the firearms charge.
Both men will remain in custody pending their respective hearings.
The investigation was conducted by the FBI Bank Robbery Task Force, which is comprised of personnel from the FBI, Houston Police Department and Harris County Sheriff's Office. Assistant United States Attorney Jennie Basile is prosecuting the case.
Friday 29 November 2013
Wanblee Man Indicted for Conspiracy to Distribute Marijuana and MethamphetamineRead the Press Release
United States Attorney Brendan V. Johnson announced that a Wanblee, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute Controlled Substances.
Dana Provincial, age 35, was indicted on November 19, 2013. He appeared before U.S. Magistrate Judge Veronica L. Duffy on November 25, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in custody and/or a $1,000,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund.
No later than 2009, Provincial conspired with others to distribute marijuana and methamphetamine in the District of South Dakota.
The charge is merely an accusation and Provincial is presumed innocent until and unless proven guilty.
The investigation is being conducted by Northern Plains Safe Trails Drug Enforcement Task Force, the Federal Bureau of Investigation, the South Dakota Division of Criminal Investigation, and the Bureau of Indian Affairs Office of Justice Services. Assistant U.S. Attorney Ted L. McBride is prosecuting the case.
Provincial was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has been set for January 28, 2014.
Spearfish Man Sentenced for Mail Fraud and Misbranding of A DrugRead the Press Release
United States Attorney Brendan V. Johnson announced that a Spearfish, South Dakota, man convicted of Mail Fraud and Misbranding of a Drug was sentenced on November 25, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
John Martin, age 74, was sentenced to 9 years in custody, 3 years of supervised release, a $125 special assessment to the Federal Crime Victims Fund, and restitution of at least $209,300. The court deferred a final determination on restitution until a later date.
Martin was indicted for Mail Fraud and Misbranding of a Drug by a federal grand jury on March 20, 2012. He pled guilty on May 9, 2013.
Between February 27, 2007, and December 31, 2011, Martin, who is not a physician, fraudulently claimed he could treat and cure cancer and other diseases. Martin instructed individuals who contacted him to send samples of bodily fluids and hair, along with money, to him in Spearfish. In one instance, he instructed a person to send money and samples of blood, saliva, and hair so that he could test the samples for cancer. Martin then informed the individual of the presence of colon cancer, and that the individual needed to travel to Spearfish for treatment. Martin charged the individual for treatment, prescribed herbal supplements, and later informed the individual that the cancer was cured.
Additionally, in April 2011, Martin directed a person to take herbal supplement pills, which Martin provided, as a treatment for cancer. Martin fraudulently informed that person that he had liver cancer and prescribed 96 herbal supplements to treat the cancer, which caused the supplements to become “drugs” under federal law. The supplements lacked labeling bearing adequate directions for use in the treatment of cancer.
The investigation was conducted by the U.S. Postal Inspection Service, the U.S. Food and Drug Administration-Office of Criminal Investigations, the South Dakota Division of Criminal Investigation, the Spearfish Police Department, the Belle Fourche Police Department, and the Butte County Sheriff's Office. The case was prosecuted by Assistant U.S. Attorney Eric Kelderman.
Martin was immediately turned over to the custody of the U.S. Marshals Service.
Sentences for November 22 – 27, 2013Read the Press Release
Jose Lucio Orozco-Ortiz, 45, of Mexico, was sentenced by Federal District Court Judge Alan B. Johnson on November 27, 2013, for illegal re-entry of a previously deported alien into the United States. Orozco-Ortiz was arrested in Casper, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Travis Wagner, 33, of Gillette, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on November 26, 2013, for being a felon in possession of a firearm. Wagner received 69 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Timothy J. Loghry, 39, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 26, 2013, for conspiracy to possess with intent to distribute, and to distributing at least 500 grams or more of methamphetamine. Loghry was arrested in Cheyenne, Wyoming. He received 136 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $400.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Fernando Ortiz-Fierro, 39, of Mexico, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 26, 2013, for illegal re-entry of a previously deported alien into the United States. Ortiz-Fierro was arrested in Casper, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Ezequiel Yaheudt Rodriguez-Guzman, 19, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on November 26, 2013, for illegal re-entry of a previously deported alien into the United States. Rodriguez-Guzman was arrested in Basin, Wyoming. He received time served, plus ten days, was ordered to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Kevin R. Kaufman¸48, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 25, 2013, for conspiracy to possess with intent to distribute, and to distributing between 200 and 350 grams of methamphetamine. Kaufman was arrested in Cheyenne, Wyoming. He received 60 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Vincent Earl Hagey, 44, of Las Vegas, Nevada, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 25, 2013, for assault by striking. Hagey was arrested in Yellowstone National Park. He received time served, one year of supervised release, and was ordered to pay restitution in the amount of $6,765.90. This case was investigated by the National Park Service.
Travis K. Smith, 44, of Provo, Utah, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 25, 2013, for conspiracy to possess with intent to distribute, and to distributing 397 grams of methamphetamine. Smith was arrested in Gillette, Wyoming. He received 33 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment and a $500.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Lela M. Carpenter, 38, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 25, 2013, for conspiracy to possess with intent to distribute, and to distributing between 500 grams and 1.5 kilograms of methamphetamine. Carpenter was arrested in Cheyenne, Wyoming. She received 120 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $400.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Kenneth C. Garcia, 57, of Florissant, Colorado, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on November 25, 2013, for conspiracy to possess with intent to distribute, and to distributing 425 grams of methamphetamine. Garcia was arrested in Denver, Colorado. He received 30 months imprisonment, to be followed by three years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
Mike Grant Harmon, 42, of Casper, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on November 22, 2013, for conspiracy to possess with intent to distribute, and to distributing between 500 grams and 1.5 kilograms of methamphetamine. Harmon was arrested in Casper, Wyoming. He received 151 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $500.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.
Porcupine Man Pleads Not Guilty to Second Degree MurderRead the Press Release
United States Attorney Brendan V. Johnson announced that a Porcupine, South Dakota, man has been indicted by a federal grand jury for Second Degree Murder.
Lawrence Red Shirt, age 27, was indicted on November 19, 2013. Red Shirt appeared before U.S. Magistrate Judge Veronica L. Duffy on November 26, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to life in custody and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The charge relates to Red Shirt killing another man by stabbing him multiple times on November 8, 2013, at Rocky Ford.
The charge is merely an accusation and Red Shirt is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Kathryn N. Rich is prosecuting the case.
Red Shirt was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has been set for February 4, 2014.
Methamphetamine Conspiracy Case Ends with Two Pleading Guilty and Two Convicted at TrialRead the Press Release
United States Attorney Brendan V. Johnson announced that two Sioux Falls, South Dakota, men were found guilty of drug charges as a result of a federal jury trial in Sioux Falls, and their two co-defendants were sentenced after pleading guilty.
Austin Jon Dalsted, age 20, was found guilty of conspiracy to distribute 500 grams or more of methamphetamine. The charge carries a mandatory minimum sentence of 10 years in prison and a maximum of life in prison and/or a $10 million fine, a minimum of 5 years and maximum of life on supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Jeffrey Harley Strom, age 29, was convicted of the lesser included offense of distribution of methamphetamine. That charge carries a penalty of up to 20 years in prison and/or a $1 million fine, a minimum of 3 years and a maximum of life on supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Regina Renee Johnson, of Sioux Falls, and Robert Raymond Jackson, of Brandon, South Dakota, both age 43, pled guilty to their part in the conspiracy on September 12 and 13, 2013, respectively.
Both Johnson and Jackson were sentenced by U.S. District Court Judge Lawrence L. Piersol on November 25, 2013, to 210 months in custody followed by 5 years of supervised release. A sentencing date for Dalsted and Strom has not yet been set.
The four defendants were indicted by a federal grand jury on May 8, 2013 for Conspiracy to Distribute a Controlled Substance. Johnson and Jackson pled guilty in September 2013. The trial for Dalsted and Strom commenced on November 19 and concluded on November 21, 2013.
On March 27, 2013, Sioux Falls Police were called to a local motel when Regina Johnson tried to return to the room in which she had already checked out. The motel manager asked the police to check Johnson’s room. When the police checked the room, they found $87,300 cash hidden under the bed. Police located and arrested Johnson. At the time of her arrest she was with Robert Jackson in an SUV, which contained over seven pounds of methamphetamine. While the police were searching the SUV, they noticed Jeff Strom watching them and making calls on his cell phone. When questioned by the police, Strom admitted that Johnson had called him to serve as a lookout at the motel where the cash was found. The police next searched the home where Johnson, Jackson and Johnson’s son, Austin Dalsted, were living. The search found more cash and methamphetamine.
This case was investigated by the Sioux Falls Police Department, the South Dakota Division of Criminal Investigation, and the U.S. Drug Enforcement Administration. Assistant U.S. Attorney John E. Haak prosecuted the case.
All defendants are in the custody of the U.S. Marshals Service.Marin County Man Sentenced to 142 Months in Prison for Trafficking MethamphetamineRead the Press Release
SAN FRANCISCO – Jesse James Starr, was sentenced on November 25, 2013, to nearly 12 years in prison for trafficking methamphetamine, United States Attorney Melinda Haag announced.
Starr, 40, of San Rafael, pleaded guilty on August 30, 2013, to a violation of 21 U.S.C. § 841(a)(1). According to the plea agreement, Starr admitted that he possessed three ounces of methamphetamine in March of 2013, and almost four ounces of methamphetamine in August of 2012. Starr also admitted that, in March of 2013, he fled from police and crashed his car during the pursuit. Starr’s criminal history, as well as his history of leading police in high speed pursuits, contributed to the length of his sentence.
“This case shows the importance my office places on the community’s safety,” United States Attorney Melinda Haag said. “It also shows the importance of the partnership between federal and state law enforcement. The Marin County Major Crimes Task Force identified Starr as a dangerous, repeat offender, and my office worked with the Task Force to prosecute this case.”
Marin County District Attorney Edward S. Berberian, Jr., similarly called Starr’s prosecution “an excellent example of state and federal authorities working together to remove a dangerous narcotics distributor from the streets,” and thanked the U.S. Attorney’s Office for its efforts in prosecuting the case.
The sentence was handed down by the Honorable Charles R. Breyer, United States District Court Judge. Judge Breyer also sentenced Starr to 5 years of supervised release. Starr was in custody at the time of sentencing and will begin serving his sentence immediately.
The prosecution is the result of a joint investigation by the Marin County Major Crimes Task Force, led by Marin County Deputy Sheriff Mike Dobbins, and the federal Drug Enforcement Administration, led by Special Agent Geoff Kolanowski.
(Starr indictment )
Fort Thompson Woman Charged with LarcenyRead the Press Release
United States Attorney Brendan V. Johnson announced that a Fort Thompson, South Dakota, woman has been indicted by a federal grand jury for Larceny.
Ruby Sazue, age 20, was indicted on November 14, 2013. She appeared before U.S. Magistrate Judge Mark A. Moreno on November 26, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 5 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
Sazue is alleged to have stolen a motor vehicle in Fort Thompson in October 2013. The charge is merely an accusation and Sazue is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation and the Bureau of Indian Affairs. Assistant U.S. Attorney Meghan Dilges is prosecuting the case.
Sazue was remanded to the custody of the U.S. Marshals Service pending trial. Trial has been set for January 21, 2014.
Former KKK Leader Indicted for Cross Burning in Alabama; Second KKK Member Indicted for PerjuryRead the Press Release
Steven Joshua Dinkle, former Exalted Cyclops of a chapter of the Ku Klux Klan (KKK) in Ozark, Ala., was arrested on Wednesday, Nov. 27, in Mississippi for burning a cross at the entrance to a predominantly African-American neighborhood and for obstructing the investigation into the offense. Pamela Morris, Dinkle’s mother and the former secretary of the KKK chapter, was arrested on Nov. 21, 2013, for committing perjury before the grand jury investigating the cross burning.
Dinkle, 28, was charged in a five-count indictment returned by a federal grand jury in the Middle District of Alabama that was unsealed on Nov. 27. The indictment charges him with one count of conspiracy to violate housing rights, one count of criminal interference with the right to fair housing, one count of using fire to commit a federal felony and two counts of obstruction of justice.
The indictment alleges that on May 8, 2009, Dinkle conspired with another person to burn a cross in an African-American neighborhood to threaten and intimidate residents of that neighborhood and thereby interfere with their federally protected housing rights. Dinkle allegedly constructed a six-foot cross, wrapping jeans and a towel around it. He and his co-conspirator drove the cross to an African-American community near Johntown Road in Ozark where Dinkle poured fuel on the cross, erected it in the ground and set it on fire. The indictment further contends that Dinkle obstructed justice by lying to local investigators in 2009, and federal investigators in 2012. Dinkle claimed he had withdrawn from the KKK months before the cross burning, provided a false alibi and denied knowing a person who was, in fact, his superior in the KKK.
The grand jury returned a separate indictment against Morris, 45, charging her with two counts of perjury. The indictment alleges that Morris made multiple false statements to the grand jury investigating the cross burning when she denied her own involvement in the KKK and knowing that Dinkle was also involved.
If convicted, Dinkle could face a maximum statutory sentence of 10 years in prison and a $250,000 fine on the conspiracy and criminal-interference counts; sentence maximum of 10 years in prison for the use-of-fire; a maximum of 20 years in prison and a $250,000 fine for obstructing justice by making false statements to local investigators; and a maximum of five years in prison and a $250,000 fine for making false statements to the FBI.
If convicted, Morris could face a maximum statutory sentence of five years in prison and a $250,000 fine on each count of perjury.
This case is being investigated by the FBI, with the assistance of the Dale County Sheriff’s Office and the Ozark Police Department. The case is being prosecuted by Assistant U.S. Attorney Jerusha T. Adams of the Middle District of Alabama and Trial Attorney Chiraag Bains of the Justice Department’s Civil Rights Division.
An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty.
Eagle Butte Man Sentenced for Third Degree Burglary and Aiding and AbettingRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man convicted of Third Degree Burglary and Aiding and Abetting was sentenced on November 26, 2013, by U.S. District Judge Roberto A. Lange.
Brian One Feather, age 31, was sentenced to 18 months of custody, 2 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund. Restitution will remain open for 30 days.
One Feather was indicted by a federal grand jury for Third Degree Burglary, Aiding and Abetting, and Larceny on July 17, 2013. He pled guilty to Third Degree Burglary and Aiding and Abetting on September 12, 2013.
One Feather’s conviction is the result of a June 2012 break-in at the Howard V. Johnson Cultural Heritage Center for the Cheyenne River Sioux Tribe in Eagle Butte. After One Feather broke in, he took approximately $37,420 worth of cultural and craft items belonging to the Cultural Heritage Center.
This case was investigated by the Cheyenne River Sioux Law Enforcement Division. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
One Feather was immediately turned over to the custody of the U.S. Marshals Service.