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Friday 22 November 2013
Owner of Home Improvement Company Pleads Guilty to FraudRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS, OHIO– Terrance J. King, 46, of Columbus pleaded guilty to charges that he defrauded homeowners, businesses, the Columbus Metropolitan Housing Authority (CMHA), the U.S. Department of Housing and Urban Development (HUD), and the Internal Revenue Service (IRS) in connection with a home improvement repair company he operated. King pleaded guilty to one count each of money laundering, false claims, and filing a false federal income tax return. In addition, King agreed to forfeit $40,280.94.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), and Barry McLaughlin, Special Agent in Charge, U.S. Department of Housing and Urban Development Office of Inspector General announced the guilty pleas entered today before U.S. Magistrate Judge Terence P. Kemp.
According to court documents, during 2008, 2009 and 2010 King owned and operated Home Improvement Terrance King, doing business in the Dayton, Springfield, and Columbus, Ohio areas. King or his employees solicited business at properties which needed roofing repairs. The clients’ insurance companies were contacted and claims were filed for the repairs. King accepted the insurance money as payment for services rendered.
King failed to report all of the income earned from his company on his federal income tax returns for those three years. For the 2009 income tax year, King claimed total income in the amount of $7,919, when his actual total income was $243,656.12. The total tax loss to the IRS as a result of the false income tax returns filed by King was $241,076.35.
While earning the income from Home Improvement Terrance King, on or about September 18, 2008, King submitted to the Columbus Metropolitan Housing Authority a recertification application package to continue to receive subsidized housing assistance supported by funds from the United States Department of Housing and Urban Development. In this package, King submitted specific documents representing that he earned little or no income and had no assets.
Money laundering is punishable by up to ten years in prison and a fine of up to $250,000. Filing a false claim is punishable by up to five years in prison, a fine of up to $250,000, and restitution to HUD in the amount of approximately $9,000. The willful filing of a false federal income tax return is punishable by up to three years in prison, a fine of up to $250,000, and restitution to the IRS in the amount of approximately $241,076.35. The court will schedule a date for sentencing.
"Tax violations have been erroneously referred to as victimless crimes, but it's the honest law-abiding citizen who is harmed when someone tries to manipulate our nation's tax system," said Kathy A. Enstrom, Acting Special Agent in Charge, IRS, Criminal Investigation, Cincinnati Field Office.
U.S. Attorney Stewart commended the investigation conducted by the IRS and HUD Office of Inspector General, and Assistant U.S. Attorneys Laura Fulton and Jessica Knight, who are prosecuting the case.
# # #Orange Man Sentenced to Three Years in Federal Prison for Illegally Possessing FirearmsRead the Press Release
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Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that BRIAN FARRELL, 36, of Orange, was sentenced today by U.S. District Judge Janet C. Hall in New Haven to 36 months of imprisonment, followed by three years of supervised release, for illegally possessing firearms.
According to court documents and statements made in court, on December 26, 2012, federal and state law enforcement officers searching for a federal fugitive at 75 Daggett Street in New Haven encountered FARRELL at an apartment at that location. FARRELL was found in possession of two pistols, a sawed-off shotgun, assorted ammunition and body armor.
In 2001, FARRELL was convicted in U.S. District Court in Connecticut of conspiracy to import Ecstasy. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
On June 7, 2013, FARRELL pleaded guilty to one count of possession of firearms by a previously convicted felon.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven Police Department. The case was prosecuted by Assistant U.S. Anthony E. Kaplan.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Official Admits Stealing $13K from Independent UnionRead the Press Release
PITTSBURGH – A resident of Butler County pleaded guilty in federal court to a charge of union embezzlement, United States Attorney David J. Hickton announced today.
Duane Rill, 52, of Cranberry Township, Pa., pleaded guilty on Nov. 20, to one count before United States District Court Judge Nora Barry Fischer.
In connection with the guilty plea, the court was advised that Rill, a Secretary-Treasurer of the Berry Metal Employees’ Association, an independent union, stole approximately $13,496 from the union by writing and cashing unauthorized union checks and by making an unauthorized cash withdrawal during the period from March 23, 2007, to Nov. 20, 2009.
Judge Fischer scheduled sentencing for March 27, 2014, at 9 a.m. The law provides for a maximum total sentence of not more than 5 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentence, the court released Rill on bond.
Assistant United States Attorney Mary McKeen Houghton is prosecuting this case on behalf of the government.
The Department of Labor, Office of Labor Management Standards, conducted the investigation that lead to the prosecution of Rill.
New York Man Charged with Traveling to Engage in Sex with MinorRead the Press Release
Gary C. Green, Jr., 43, of Johnstown, New York, was charged with travel to engage in illicit sexual contact with a minor, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The criminal information charges that from on or about August 3, 2013, through on or about August 4, 2013, Green knowingly traveled in interstate commerce, from the State of New York to the State of Ohio, for the purpose of engaging in illicit sexual conduct with another person, that is, a fifteen-year-old girl.
If convicted, the sentence in this case will be determined by the Court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Carol M. Skutnik. The case was investigated by the Federal Bureau of Investigation, Youngstown Office.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
New Haven Man Sentenced to More Than Nine Years in Federal Prison for Distributing Crack CocaineRead the Press Release
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Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that FREDRICK COX, SR., also known as “Bama-Lama,” 43, of New Haven, was sentenced today by Senior U.S. District Judge Ellen Bree Burns in New Haven to 115 months of imprisonment, followed by four years of supervised release, for distributing cocaine base (“crack cocaine”).
COX is one of more than 100 individuals charged as a result of “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven. Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms. The investigation revealed that COX conspired with others to distribute crack cocaine.
On April 17, 2013, COX pleaded guilty to one count of conspiracy to possess with intent to distribute and to distribute 28 grams or more of cocaine base.
COX has sustained at least 11 prior felony convictions and, since September 12, 2011, he has been serving an unrelated five-year state sentence. Judge Burns imposed the 115-month federal sentence to run consecutively to COX’s state sentence.
This matter is being investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The U.S. Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments have provided valuable assistance to the investigation.
This case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Marc Silverman.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Ms-13 Members Convicted of Murders<br /> and Attempted MurdersRead the Press Release
After a three-week trial, a federal jury has convicted two MS-13 members for their roles in committing murders, attempted murders and armed robberies in Gwinnett and DeKalb counties in northern Georgia.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Sally Quillian Yates of the Northern District of Georgia, Special Agent in Charge Brock D. Nicholson of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Atlanta, and Special Agent in Charge Mark F. Giuliano of the FBI’s Atlanta Field Office made the announcement.
“These MS-13 gang members engaged in a ruthless – and senseless – string of attacks and murders, terrorizing the communities in which they operated,” said Acting Assistant Attorney General Raman. “Thanks to the investigators and prosecutors who made today’s convictions possible, these violent gang members are off the streets of northern Georgia and face up to life in prison behind bars.”
“These two defendants set the standard for violence as members of MS-13, an international gang infamous for its disregard for human life,” said U.S. Attorney Yates. “They spread fear throughout the community by killing innocent pedestrians, shooting suspected rival gang members and robbing innocent people at gunpoint. By finding them guilty, this jury has held them accountable for their crimes.”
“As active members of one of the most violent gangs in the world, these men posed a significant threat to the public safety of our communities,” said HSI Special Agent in Charge Nicholson, who is responsible for agency investigations in Georgia and the Carolinas. “HSI and our partners at the FBI and local law enforcement agencies have taken a strong stand against transnational gangs in Atlanta. These are just the latest convictions that show how successful our efforts have been.”
“Today's conviction in federal court of two violent members of the international gang known as MS-13 adds to the list of successes for those law enforcement officers, investigators and prosecutors who are working hard to neutralize this dangerous criminal enterprise,” said FBI Special Agent in Charge Giuliano. “While these successes are important for the FBI and its various law enforcement partners, it is more important to those particular communities impacted by MS-13's violent crimes.”
Remberto Argueta, aka Pitufo, 27, of Lilburn, Ga., and William Espinoza, aka Cheberria and Crazy, 31, of Norcross, Ga., were convicted today by a federal jury and will be sentenced at a later date before U.S. District Judge Richard W. Story. Each defendant was convicted of RICO conspiracy involving murder. Argueta was also convicted of violent crime in aid of racketeering and a firearms offense related to the murder of Arpolonio Rios-Jarquin. Espinoza was also convicted of violent crime in aid of racketeering and a firearms offense related to the attempted murder of Jayro Arango-Sanchez. Violent crime in aid of racketeering for murder carries a mandatory sentence of life in prison, while RICO conspiracy involving murder carries a sentence of up to life in prison. Parole has been abolished in the federal system.
According to court records, MS-13 is an international gang that has operated in the Atlanta area since at least 2005. The gang members staked out Gwinnett and DeKalb Counties as their home territory.
Evidence presented at trial showed that Argueta, along with other gang members, planned to rob Arpolonio Rios-Jarquin, a suspected drug dealer, at a hotel in April 2007. When Rios-Jarquin turned out to have his own gun, Argueta and his fellow MS-13 members engaged in a shootout with Rios-Jarquin that spilled outside the hotel room. Surveillance video showed one of the MS-13 members stopping to pick up Rios-Jarquin’s weapon, which he later showed off as a trophy.
In October 2007, Argueta and several other MS-13 members were at an apartment complex in Gwinnett County when Argueta spotted suspected rival gang members. According to evidence at trial, he approached them and asked them who they “claimed”—that is, what gang they belonged to. When Christian Escobar responded that he and his friend, Jose Garcia-Barajas, were members of the rival gang 18th Street, Argueta said, “You’re going to die.” Argueta pulled out a handgun and started chasing and shooting at Escobar and Garcia-Barajas. He shot Escobar in the back and Garcia-Barajas in the hip and arm. While shooting at them, Argueta also fired shots into the apartments of nearby residents. An elderly woman testified that one of Argueta’s bullets hit an armchair that she had been sitting in just a few minutes earlier.
Evidence at trial showed that in early July 2008, Espinoza lent his .380 caliber handgun to fellow gang members so that they could retaliate against a member of La Raza, a rival gang. An MS-13 member shot a 15-year-old boy who was taking a shortcut across through an apartment complex. The boy was not a member of a gang and had traveled from Ohio with his family to visit other family members for the Fourth of July holiday.
A few weeks later in July 2008, Espinoza and other members of MS-13 were at El Pueblito, a nightclub in DeKalb County, when a fight broke out with suspected members of the rival gang 18th Street. Surveillance video showed Espinoza going out to the parking lot and retrieving a .380 handgun from a car. He approached the club entrance and shot Jayro Arango-Sanchez in the stomach. Arango-Sanchez testified at trial that he was not a gang member and that he was at the club with his girlfriend and brother to celebrate his birthday.
According to evidence at trial, just two days later, Espinoza and four other MS-13 members drove to an apartment complex in Gwinnett County to look for pedestrians to rob. After spotting a victim, Espinoza and another gang member got out of their SUV and approached Aurelio Vasquez. Espinoza put his .380 handgun to Vasquez’s head while the other MS-13 member started to search Vasquez’s pockets for money. Vasquez, who was returning home after buying groceries, resisted being robbed, so Espinoza shot him through the head. Espinoza and his fellow gang members wanted to rob Vasquez to get money for beer.
This case is being investigated by ICE-HSI and FBI, with assistance from Gwinnett County Police Department, DeKalb County Police Department and Gwinnett County Sheriff’s Office.
Trial Attorney Joseph K. Wheatley of the Criminal Division’s Organized Crime and Gang Section and Assistant United States Attorney Paul R. Jones are prosecuting the case.Michael Thomas Bad Old Man Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on November 22, 2013, before Chief U.S. District Judge Dana L. Christensen, MICHAEL THOMAS BAD OLD MAN, a 21-year-old resident of Cut Bank and an enrolled member of the Blackfeet Tribe, was sentenced to a term of:
- ison: 27 months, concurrent with another sentence
- ecial Assessment: $100
- pervised Release: 3 years
BAD OLD MAN was sentenced in connection with his guilty plea to burglary.
In an Offer of Proof filed by Assistant U.S. Attorney Ryan G. Weldon, the government stated it would have proved at trial the following:
On February 4, 2012, "Jane Doe" was in Great Falls because her father was in the hospital. Three individuals walked by her residence in Browning, which was located within the exterior boundaries of the Blackfeet Indian Reservation.
On February 4, 2012, a neighbor was out on his porch and observed three male individuals walking by his neighbor's residence. While he saw the three individuals walking by the residence, he did not see them pass by. He then heard three kicks and he knew that someone was breaking into "Jane Doe's" residence. He told his wife to call their son who is an officer with the Blackfeet Law Enforcement Services.
His wife called their son and then she grabbed her camera. When their son, the officer, pulled up the officer and the neighbor went into "Jane Doe's" residence. The neighbor's wife then took pictures of all three individuals running out of the house. The burglary occurred in broad daylight.
The individuals who broke into the house then climbed the fence, and one escaped. BAD OLD MAN and "X.X." were caught. BAD OLD MAN had items in his pockets. While waiting for law enforcement to arrive, BAD OLD MAN stated that he was going to kill the neighbor and the officer when he gets out of jail.
After backup arrived, the officer took pictures of "Jane Doe's" front door to the residence. The door was damaged. The officer stated that he was able to identify all three defendants by name when he saw them in the residence.
While at jail, a detention officer patted down BAD OLD MAN and found numerous earrings, a knife, a zippo lighter, a metal box, a heart-shaped ring, two NFL star earrings, a pink wrist band with pendant, and a rosary with a white pendant. These items were photographed.
Jane Doe" identified the items that were found on BAD OLD MAN as belonging to her. "Jane Doe's" daughter explained that BAD OLD MAN was in her house before and knew that it was "Jane Doe's" house. "Jane Doe's" daughter estimated that BAD OLD MAN had been in the house approximately five times.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that BAD OLD MAN will likely serve all of the time imposed by the court. In the federal system, BAD OLD MAN does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Bureau of Indian Affairs.
McLaughlin Man Charged with Assault with A Dangerous Weapon and Domestic Assault by an Habitual OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that a McLaughlin, South Dakota, man has been indicted by a federal grand jury.
Lawrence Village Center, age 46, was indicted on November 14, 2013, for Assault with a Dangerous Weapon and Domestic Assault by an Habitual Offender. Village Center appeared before U.S. Magistrate Judge William D. Gerdes on November 19, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 10 years of imprisonment and/or a $250,000 fine, 3 years of supervised release, an additional 2 years of supervised release upon revocation, and a mandatory $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges are merely accusations, and Village Center is presumed innocent until and unless proven guilty.
The Indictment alleges that on August 31, 2013, Village Center assaulted his spouse with a hammer.
The investigation is being conducted by the Bureau of Indian Affairs. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Village Center was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
McLaughlin Man Charged with Aggravated Sexual Abuse of A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that a McLaughlin, South Dakota, man has been indicted by a federal grand jury.
Robert Arnold Stand, age 25, was indicted on November 14, 2013, for Aggravated Sexual Abuse of a Minor. Stand appeared before U.S. Magistrate William D. Gerdes on November 19, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is a mandatory minimum of 30 years of imprisonment and/or a $250,000 fine, and a mandatory minimum of 5 years up to life of supervised release. If Stand is found to have violated any condition of his supervised release, he may be incarcerated for an additional term of up to 5 years for each violation with one exception. If Stand commits a new felony violation of sexual abuse, sexual exploitation and other abuse of children, transportation for illegal sexual activity and related crimes, kidnapping, or sex trafficking of children or by force, fraud, or coercion, while on supervised release, he may be incarcerated for a mandatory minimum term of 5 years up to life for each violation. The maximum penalty also includes a $100 special assessment to the Federal Crime Victims Fund, and restitution may be ordered.
The charge is merely an accusation, and Stand is presumed innocent until and unless proven guilty.
The Indictment alleges that on October 5, 2013, Stand engaged in and attempted to engage in a sexual act with a minor.
The investigation is being conducted by the Bureau of Indian Affairs. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Stand was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Marlborough Resident Charged with Armed Robbery of South Windsor PharmacyRead the Press Release
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Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that DAVID HANEY, 52, of Marlborough, was arrested today on a federal criminal complaint charging him with the armed robbery of prescription narcotics from a South Windsor CVS store in September.
HANEY was arrested this morning in Hamden. He appeared this afternoon before U.S. Magistrate Judge Joan G. Margolis in New Haven and was ordered detained.
According to court documents, this matter stems from an investigation into a series of armed robberies occurring at pharmacies in the greater Hartford area and Western Massachusetts. During each robbery, an assailant typically brandished a handgun and proceeded to steal large quantities of prescription narcotics.
As alleged in the criminal complaint, at approximately 7:45 p.m. on September 25, 2013, HANEY entered the CVS store located at 525 Buckland Road in South Windsor and proceeded to the pharmacy counter. He then asked for the pharmacist by name, showed the pharmacist a firearm that was in his waistband and demanded oxycodone pills. The pharmacist gave HANEY more than 2000 oxycodone pills of different strengths and HANEY exited the store.
The complaint charges HANEY with interference with commerce through threat of violence and conspiracy, possession of a firearm in furtherance of a crime of violence, and possession and conspiracy to possess narcotics with intent to distribute.
Acting U.S. Attorney Daly stated that the investigation is ongoing.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Drug Enforcement Administration and the South Windsor, East Hartford, Meriden, Vernon, and Manchester Police Departments, with the assistance of other state and local law enforcement agencies. This case is being prosecuted by Assistant U.S. Attorney Anthony E. Kaplan.
Acting U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Man Pleads Guilty to Piloting Commerical Ships on Great Lakes with Fraudulent Coast Guard LicenseRead the Press Release
SYRACUSE, NEW YORK - Richard S. Hartunian, United States Attorney for the Northern District of New York, announced today that Mark Anselm, 37, of Clayton, N.Y., pled guilty before the U.S. District Judge Glen T. Suddaby to six felony offenses that charged him with making false statements to officials of the United States Coast Guard, possession and use of an altered merchant marine license, and aggravated identity theft.
In pleading guilty, Anselm admitted that during 2011 and 2012 he held himself out to federal officials, to various marina owners, and to other potential employers as being a licensed commercial ship pilot when he possessed no such license. Anselm admitted to having repeatedly presented fraudulent merchant marine licenses to employers and potential employers that he had altered to substitute his name. With his false licenses, he gained employment and operated various commercial ships on Lake Ontario. His criminal conduct was discovered by the Coast Guard after he grounded a tug boat in Canadian waters on June 19, 2012. The ensuring investigation revealed numerous instances of Anselm holding himself out as a licensed commercial merchant marine captain based upon licenses that he had forged.
Anselm is scheduled to be sentenced on March 28, 2014, in Syracuse, NY. He faces a maximum term of incarceration of 27 years, and a fine of up to $1.5 million. The sentence imposed for aggravated identity theft contains a mandatory minimum 2 year term of incarceration and must run consecutively to the sentence imposed on any other count.
This case was investigated by Special Agents of the Coast Guard and Department of Homeland Security. Prosecution is being handled by Assistant United States Attorney Craig A. Benedict. Mr. Benedict may be contacted for questions regarding this case at 315-448-0726.
MS-13 Members Convicted of Murders and Attempted MurdersRead the Press Release
ATLANTA – Remberto Argueta and William Espinoza have been convicted by a federal jury for committing murders, attempted murders, and armed robberies in Gwinnett and DeKalb counties.
“These two defendants set the standard for violence and disregard for human life as members of the international gang MS-13,” said United States Attorney Sally Quillian Yates. “They spread fear throughout the community by killing innocent pedestrians, shooting suspected rival gang members and robbing innocent people at gunpoint. By finding them guilty, this jury has held them accountable for their crimes.”
“As active members of one of the most violent gangs in the world, these men posed a significant threat to the public safety of our communities,” said Brock D. Nicholson, special agent in charge of ICE HSI Atlanta, which is responsible for agency investigations in Georgia and the Carolinas. “HSI and our partners at the FBI and local law enforcement agencies have taken a strong stand against transnational gangs in Atlanta. These are just the latest convictions that show how successful our efforts have been.”
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated: "Today's conviction in federal court of two violent members of the international gang known as MS-13 adds to the list of successes for those law enforcement officers, investigators and prosecutors who are working hard to neutralize this dangerous criminal enterprise. While these successes are important for the FBI and its various law enforcement partners, it is more important to those particular communities impacted by MS-13's violent crimes."
According to United States Attorney Yates, the charges and other information presented in court: MS-13 is an international gang that has operated in the Atlanta area since at least 2005. The gang members staked out Gwinnett and DeKalb Counties as their home territory. The evidence presented at trial showed that the defendants committed the following crimes:
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Remberto Argueta, along with other gang members, planned to rob Arpolonio Rios-Jarquin, a suspected drug dealer, at a hotel in April 2007. When Rios-Jarquin turned out to have his own gun, Argueta and his fellow MS-13 members engaged in a shootout with Rios-Jarquin that spilled outside the hotel room. Surveillance video showed one of the MS-13 members stopping to pick up Rios-Jarquin’s weapon, which he later showed off as a trophy.
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In October 2007, Argueta and several other MS-13 members were at an apartment complex in Gwinnett County when Argueta spotted suspected rival gang members. He approached them and asked them who they “claimed”—that is, what gang they belonged to. When Christian Escobar responded that he and his friend, Jose Garcia-Barajas, were members of the rival gang 18th Street, Argueta said, “You’re going to die.” Argueta pulled out a handgun and started chasing and shooting at Escobar and Garcia-Barajas. He shot Escobar in the back and Garcia-Barajas in the hip and arm. While shooting at them, Argueta also fired shots into the apartments of nearby residents. An elderly woman testified that one of Argueta’s bullets hit an armchair that she had been sitting in just a few minutes earlier.
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In early July 2008, William Espinoza loaned his .380 caliber handgun to fellow gang members so that they could retaliate against a member of La Raza, a rival gang. An MS-13 member shot a 15-year-old boy who was taking a shortcut through an apartment complex. The boy was not a member of a gang and had traveled from Ohio with his family to visit other family members for the Fourth of July holiday.
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A few weeks later in July 2008, Espinoza and other members of MS-13 were at El Pueblito, a nightclub in DeKalb County, when a fight broke out with suspected members of the rival gang 18th Street. Surveillance video showed Espinoza going out to the parking lot and retrieving a .380 handgun from a car. He approached the club entrance and shot Jayro Arango-Sanchez in the stomach. Arango-Sanchez testified that he was not a gang member and that he was at the club with his girlfriend and brother to celebrate his birthday.
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Just two days later, Espinoza and four other MS-13 members drove to an apartment complex in Gwinnett County to look for pedestrians to rob. After spotting a victim, Espinoza and another gang member got out of their SUV and approached Aurelio Vasquez. Espinoza put his .380 handgun to Vasquez’s head while the other MS-13 member started to search Vasquez’s pockets for money. Vasquez, who was returning home after buying groceries, resisted being robbed, so Espinoza shot him through the head. Espinoza and his fellow gang members wanted to rob Vasquez for beer money.
The sentencing for Remberto Argueta, also known as Pitufo, 27, of Lilburn, Ga., and William Espinoza, also known as Cheberria and Crazy, 31, of Norcross, Ga., will be scheduled at a later date before United States District Judge Richard W. Story. Each of the defendants was convicted of RICO conspiracy involving murder. Argueta was also convicted of Violent Crime in Aid of Racketeering and a firearms offense related to the murder of Arpolonio Rios-Jarquin. Espinoza was also convicted of Violent Crime in Aid of Racketeering and a firearms offense related to the attempted murder of Jayro Arango-Sanchez. Violent Crime in Aid of Racketeering for murder carries a mandatory sentence of life in prison, while RICO conspiracy involving murder carries a sentence up to life. Parole has been abolished in the federal system.
This case is being investigated by Special Agents from U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Federal Bureau of Investigation, with assistance from Gwinnett County Police Department, DeKalb County Police Department, and Gwinnett County Sheriff’s Office.
Assistant United States Attorney Paul R. Jones and U.S. Department of Justice, Organized Crime and Gang Section, Trial Attorney Joseph K. Wheatley are prosecuting 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 Atlanta Division is http://www.justice.gov/usao/gan/.
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Lyons Man Sentenced to 60 Years in Federal Prison for Producing Child PornograpyRead the Press Release
GRAND RAPIDS, MICHIGAN – Floyd Andrew Brown, Jr., 36, of Lyons, Michigan was sentenced to 720 months (60 years) in federal prison for producing child pornography, U.S. Attorney Patrick A. Miles, Jr. announced today. In addition to the prison term, U.S. District Judge Robert Holmes Bell imposed a lifetime term of supervised release that will commence once Brown is released from imprisonment. Brown will also be required to register as a sexual offender.
The case came to the attention of law enforcement in late 2012, when Brown printed a pornographic image of a minor at a department store. An attentive store employee called the police. Police interviewed Brown and executed search warrants at his residence, where they recovered a substantial amount of child pornography and other evidence. The investigation revealed that Brown had been sexually abusing young girls and producing child pornography at his home and elsewhere. Brown was taken into custody in December 2012, and he pleaded guilty to two counts of producing child pornography in July 2013. He admitted at the plea hearing that he had sexually abused young girls and had produced child pornography videos and images of that conduct. He further admitted that he had sexually exploited five female victims aged 12 and under. He also admitted to possessing additional child pornography.
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Department of Homeland Security, Homeland Security Investigations (HSI) and the Michigan State Police (MSP) investigated the case. Assistant U.S. Attorney Sean M. Lewis prosecuted the case..
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Long Island Fisherman and Fish Dealer Sentenced for Wire Fraud and Falsifying RecordsRead the Press Release
The operator of the dragger F/V Norseman and an associated fish dealer were sentenced today in federal court in Central Islip, N.Y., for criminal violations stemming from their role in systematically underreporting fluke (summer flounder) that was being harvested as part of the federal Research Set-Aside Program, the Justice Department’s Environment and Natural Resources Division announced.
On Aug. 15, 2013, Wertz pleaded guilty to one count of wire fraud and two counts of falsification of federal records for knowingly submitting 137 falsified dealer reports from May 2009 through December 2011, and 70 falsified fishing logs, known as fishing vessel trip reports (FVTRs), from May 2011 through December 2011, as part of a scheme to defraud the United States of overharvested and unreported fluke. C&C Ocean Fishery Ltd. pleaded guilty to one count of wire fraud and three counts of falsification of federal records for its participation in the scheme, which included aiding and abetting the submission of falsified dealer reports and FVTRs.
C&C Ocean was not only aware of the false Norseman FVTRs, but it aided and abetted the perpetration of the FVTR scheme through its preparation of federal dealer reports. As a federal dealer, C&C Ocean was required to prepare and submit federal dealer reports to NOAA. The dealer reports include information such as date of landing, port of landing, catch vessel, corresponding FVTR numbers, commercial grade, species, price, and weight. In order to cover up the overharvesting that occurred on the water, C&C Ocean’s dealer report had to match the catch data that was submitted on the corresponding FVTR. In other words, if the FVTR falsely underreported the Norseman’s catch of fluke, then the scheme would likely be detected unless the corresponding dealer report was similarly falsified. Both defendants prepared and submitted false dealer reports for each of the trips set forth in the table.
The case was investigated by special agents of NOAA's National Marine Fisheries Service, Office of Law Enforcement, with assistance from the New York State Department of Environmental Conservation Police. The case is being prosecuted by Christopher L. Hale of the Justice Department’s Environmental Crimes Section, Environment and Natural Resources Division.
The defendants electronically submitted the 137 false dealer reports from Wertz’s desktop computer in New York, through an out-of-state internet server, to NOAA’s Regional Fisheries Administrator in Gloucester, Mass. Under NOAA regulations, all of the Norseman’s catch had to be reported to NOAA on FVTRs. During the years 2009, 2010, and 2011, the Norseman principally targeted fluke. However, on multiple occasions the vessel exceeded its relevant federal and New York State quotas for fluke for 137 trips, totaling 86,080 pounds of fluke worth approximately $200,000.
In order to cover up the illegal fluke harvesting, the operators of the Norseman falsified the FVTRs that were submitted to NOAA. For each of the 137 trips, a false FVTR was submitted. During 2009 and 2010, another individual submitted the false FVTRs, but by May 2, 2011, Wertz was falsifying and submitting the FVTRs himself. The defendants were aware that the FVTRs were utilized by NOAA as part of the administration of its statutory-mandated fisheries management program. Charles Wertz, Jr., a commercial fisherman from East Meadow, N.Y., was sentenced to serve one year and a day in prison to be followed by three years of supervised release, 100 hours of community service, a $5,000 fine, $99,800 in restitution and a $300 special assessment. The fish dealer, C&C Ocean Fishery Ltd., was sentenced to pay a $275,000 fine, $99,800 in restitution, and a $1,600 special assessment. The court also sentenced the defendants to comply with multiple sentence conditions, including relinquishment of federal fishing permits, a ban on participation in the Research Seat-Aside Program, divestiture of any interest in the F/V Norseman, and winding down and dissolving the company, C&C Ocean Fishery Ltd., within 90 days.
Logan Man Gets 6 ½ Years in Federal Prison for Organizing Arson SchemeRead the Press Release
Michael White conspired with couple to burn down Boone rental duplex for insurance payout
CHARLESTON, W.Va. – Michael L. White was sentenced yesterday to six and a half years in prison after a federal jury found him guilty earlier this year of organizing a scheme to set fire to a Boone County rental duplex to collect more than $80,000 in insurance claims, announced U.S. Attorney Booth Goodwin. On May 10, a federal jury found White guilty on all three counts charged against him: conspiracy to commit arson, arson and accessory after the fact. Evidence at trial determined that White, 58, of Logan, conspired with an acquaintance, Kimberly Dawn Kinder, and her now deceased husband to set fire to a residential rental unit owned by White that was located in Van, Boone County, W.Va.
Kimberly Dawn Kinder, 46, of Chapmanville, previously pleaded guilty to her role in the conspiracy in June 2012. White and the Kinders conspired together to set fire to the duplex in order to collect insurance claims.
Late in the evening on October 15, 2009, the Kinders arrived at the Van Duplex. After entering through one of the rental units, Mr. Kinder poured gasoline on a pile of clothes in the living area of one of the units. Mr. Kinder set fire to the pile of clothes and Mrs. Kinder drove the getaway vehicle.
The Van Volunteer Fire Department later responded to the incident and extinguished the fire, but the property suffered severe damage. Afterward, White filed an insurance claim with Nationwide Insurance Company (“Nationwide”) as a result of the fire. Nationwide in turn paid White $80,716.51. White subsequently paid the Kinders a total of approximately $2,000 in small increments as payment for their role in the conspiracy.
Kinder was sentenced in June 2013 to three years and one month in federal prison for her role in the scheme.
United States District Judge Thomas E. Johnston ordered White to pay full restitution to Nationwide in the amount of $80,716.51.
The investigation was conducted by the West Virginia State Police. Assistant United States Attorneys Thomas Ryan and Larry Ellis handled the prosecution.
Little Eagle Woman Charged with Assault with A Dangerous Weapon and Assault Resulting in Serious Bodily InjuryRead the Press Release
United States Attorney Brendan V. Johnson announced that a Little Eagle, South Dakota, woman has been indicted by a federal grand jury.
Verinda Red Legs, age 29, was indicted by a federal grand jury on November 14, 2013, for Assault with a Dangerous Weapon and Assault Resulting in Serious Bodily Injury. Red Legs appeared before U.S. Magistrate Judge William D. Gerdes on November 19, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 10 years of imprisonment and/or a $250,000 fine, 3 years of supervised release, an additional 2 years of supervised release upon revocation, and a mandatory $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges are merely accusations, and Red Legs is presumed innocent until and unless proven guilty.
The Indictment alleges that on October 18, 2013, Red Legs assaulted her dating partner with a knife and that assault resulted in serious bodily injury.
The investigation is being conducted by the Bureau of Indian Affairs. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Red Legs was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Little Eagle Man Charged with Embezzlement and Theft from an Indian Tribal OrganizationRead the Press Release
United States Attorney Brendan V. Johnson announced that a Little Eagle, South Dakota, man has been indicted by a federal grand jury.
Dana Fast Horse, age 46, was indicted on November 14, 2013, for Embezzlement and Theft from an Indian Tribal Organization. Fast Horse appeared before U.S. Magistrate Judge William D. Gerdes on November 19, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 5 years of imprisonment and/or a $250,000 fine, 3 years of supervised release, an additional 2 years of supervised release upon revocation, and a mandatory $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges are merely accusations, and Fast Horse is presumed innocent until and unless proven guilty.
The Indictment alleges that between August 15, 2013 and October 1, 2013, Fast Horse, while Vice Chairman for the Running Antelope District, willfully and unlawfully stole, embezzled, misapplied, and converted to his own use over $1,000 of the monies and funds belonging to the Running Antelope District, which is a subdivision of the Standing Rock Sioux Tribe.
The investigation is being conducted by the Bureau of Indian Affairs. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Fast Horse was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Lincoln Woman Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that on November 22, 2013, Bobbie Elaine Parker, 35, of Lincoln, was sentenced to 12 years and seven months (151 months) in prison for conspiracy to distribute and possess with intent to distribute 500 grams or more of a mixture or substance containing methamphetamine between March of 2010 and December of 2012. Information provided to law enforcement indicated that Parker was involved in the distribution of at least 500 grams (approximately 18 ounces) of methamphetamine during that time. In June of 2012, Parker was found in possession of ½ gram of methamphetamine and over $400 in cash. In December of 2012, Parker sold approximately 1 ½ grams of methamphetamine to an undercover police officer through a third person.
This case was investigated by the Lincoln/Lancaster County Drug Task Force.
Las Vegas Man Sentenced to 14 Years in Prison for Receiving and Possessing Child PornographyRead the Press Release
LAS VEGAS, Nev. – A Las Vegas man who possessed over 1,400 images of child pornography on his home computers, has been sentenced to 14 years in prison and lifetime supervised release, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Steven Byington, 69, who was convicted by a jury on June 20, 2013, of one count of receipt of child pornography and one count of possession of child pornography, was sentenced on Thursday, Nov. 21, 2013, by U.S. District Judge Gloria M. Navarro.
“The penalties for this type of crime are very high, particularly when large amounts of pornography are received,” said U.S. Attorney Bogden. “We will aggressively prosecute the persons who victimize children through these horrible crimes.”
According to court records and evidence introduced at trial, in May 2010, Special Agents with Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) determined that Byington had made child pornography available for download through an Internet file sharing site. Agents executed a federal search warrant at Byington’s home in Las Vegas on Nov. 16, 2010, and seized four computers, external hard drives, and computer storage devices. A forensic analysis determined that the computers and equipment contained over 1,400 images, including 13 videos, of child pornography. The pornography included depictions of prepubescent minors, bondage, bestiality, and adult sexual penetration of minors.
The investigation was conducted by ICE-HSI and prosecuted by Assistant United States Attorneys Susan Cushman and Daniel R. Schiess.The case has been 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
safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
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 internetKera Dawn Evans Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in , on November 22, 2013, before U.S. Magistrate Judge Carolyn S. Ostby, KERA DAWN EVANS "a/ka/ Kera Dawn Hoots", a 30-year-old resident of Big Timber, pled guilty to possession with intent to distribute methamphetamine. Sentencing has been set for March 13, 2014. She is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Joseph E. Thaggard, the government stated it would have proved at trial the following:
In early 2013, the Montana Division of Criminal Investigation (MDCI), the Drug Enforcement Administration (DEA) and Sidney Police Department began to investigate a drug trafficking network operating in Sidney and Fairview, as well as other locations in Montana. The investigation revealed EVANS was involved in that drug trafficking network.
On March 1, 2013, EVANS sold one ounce of purported methamphetamine to an undercover MDCI agent in a transaction which occurred in Bozeman. A DEA chemist later analyzed the substance and concluded it contained 28.1 grams of actual methamphetamine.
On March 6, 2013, EVANS sold one ounce of purported methamphetamine to an undercover MDCI agent in a transaction that occurred in Livingston. A DEA chemist later analyzed the substance and concluded it contained 27.9 grams of actual methamphetamine.
On March 11, 2013, EVANS sold approximately 55 grams of purported methamphetamine to an undercover MDCI agent in a transaction that occurred in Billings. A DEA chemist later analyzed the substance and concluded it contained 54.6 grams of actual methamphetamine.
On March 14, 2013, EVANS agreed to sell more methamphetamine to the undercover MDCI agent. Thereafter, law enforcement officers stopped a vehicle in which EVANS was driving in Columbus. The officers seized approximately 223 grams of suspected methamphetamine from the vehicle. A DEA chemist later analyzed the substance and concluded it contained approximately 219 grams of actual methamphetamine.
EVANS faces possible penalties of ? years in prison, a $250,000 fine, and 3 years supervised release.
Today's change of plea is a product of diligent work by the very dedicated agents who have been joined together under the banner of Project Safe Bakken. As the work of this team - which includes law enforcement professionals from all branches of local, state, and federal law enforcement - goes forward, the people of Montana and North Dakota can expect more cases from affected communities. That is the mission and commitment of Project Safe Bakken." said U.S. Attorney Michael W. Cotter.
This investigation was a part of Project Safe Bakken, which is a cooperative effort between the Drug Enforcement Administration (DEA), the Federal Bureau of Investigation (FBI), the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Bureau of Indian Affairs (BIA), the U.S. Border Patrol, the U.S. Marshals Service, the Environmental Protection Agency Criminal Investigation Division (EPA-CID), the Department of Homeland Security (DHS), the Montana Division of Criminal Investigation (MDCI), the Montana Highway Patrol, the North Dakota Bureau of Criminal Investigation (BCI), the Billings Police Department, the Yellowstone County Sheriff's Office, the Sidney Police Department, the Sweet Grass County Sheriff's Office, and the Idaho State Police.
Justice Department Employees to Be Awarded for Service in Major CasesRead the Press Release
Several Department of Justice employees will be honored for their exemplary service in cases that had a profound impact on Northern Ohio.
The employees are being honored for their work on the Cuyahoga County corruption investigation, the investigation into Omnicare Corp. that resulted in a $50 million settlement, the successful prosecution of the LSP street gang in Youngstown for racketeering, including attempted and narcotics trafficking and two dozen convictions following the collapse of the St. Paul Croatian Federal Credit Union.
“Each of these people represents the best of federal law enforcement,” said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio. “They worked for months -- sometimes years -- to make Northern Ohio a safer place by bringing down a decade-old cycle of corruption or ensuring the elderly would receive proper healthcare or dismantling a violent street gang. They have taken on the hard challenges and succeeded in making our community better.”
“Each one of these well-deserving recipients went above and beyond to get the job done and serve our community,” said Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland office. “They were determined and dedicated to seeing justice prevail, and for that, we honor and thank them”
“The IRS, Criminal Investigation Chief's Investigative Excellence Award is presented in recognition and appreciation of the outstanding commitment and dedication to excellence by the multiple agencies in support of their investigative efforts relative to the Cuyahoga County corruption investigation. In addition, the multiple agencies who were involved in the St. Paul Croatian Federal Credit Union investigation were presented the Commendation Award for Excellence in support of their investigative efforts,” said Kathy A. Enstrom, Special Agent in Charge, IRS, Criminal Investigation, Cincinnati Field Office. “These investigations exemplify the outstanding partnership and cooperation.”
Cuyahoga County Corruption Investigation
The Cuyahoga County corruption investigation has resulted in more than 60 convictions, including the former County Commissioner, County Auditor and two Common Pleas Judges. The case uncovered several pay-to-play bribery schemes in which public officials awarded jobs, contracts and other favors in exchange for cash, trips and other gifts. Former County Commissioner Jimmy Dimora’s 28-year prison sentence is believed to be the longest sentence handed out for a public corruption conviction. The case was investigated by the Federal Bureau of Investigation and Internal Revenue Service.
Those being honored with the Attorney General’s Award for Distinguished Service are: Assistant United States Attorneys Antoinette T. Bacon, Henry DeBaggis, Nancy L. Kelley, Sharon L. Long, Robert J. Patton, Justin J. Roberts, Ann C. Rowland, Bernard A. Smith, FBI Special Agents Gregory D.L. Curtis, Melissa L. Fortunato, Raymond Michael Massie, Kirk P. Spielmaker, William M. Werner, Christine C. Oliver and IRS Special Agent Kelly D. Fatula.
Omnicare Settlement
Omnicare, Inc. paid a $50 million civil penalty to resolve claims that its various pharmacy facilities improperly dispensed controlled substances to patients at long-term care facilities across the country, such as routinely dispensing controlled substances to residents of long-term facilities without a prescription signed by a practitioner. The case was investigated by the Drug Enforcement Administration.
Receiving the Director’s Award for Superior Service by an Assistant United States Attorney – Civil and a DEA Commendation are Kent W. Penhallurick and Steven J. Paffilas. Receiving the United States Attorney’s Award for Distinguished Public Service is DEA Special Agent Scott Brinks.
LSP Gang Prosecution
Twenty-two people were convicted of racketeering and other crimes for their roles in a conspiracy in which the LSP street gang used violence, including drive-by shootings, to control territory and sell heroin, cocaine and other drugs in Youngstown. Gang leaders Derrick Johnson Jr. was sentenced to 65 years in prison and Daquann Hackett was sentenced to 37 years in prison. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Youngstown Police Department.
Receiving the Director’s Award for Superior Service by an Assistant United States Attorney – Criminal are Robert F. Corts and Daniel J. Riedl. Receiving the United States Attorney’s Award for Distinguished Public Service is ATF Special Agent John Smerglia.
St. Paul Croatian Federal Credit Union Investigation
When the St. Paul Croatian Federal Credit Union went into conservatorship and then forced liquidation in 2010, the resulting $170 million loss made it the largest credit-union failure in American history. The subsequent criminal investigation revealed a decade-long scheme in which the credit union’s Chief Financial Officer Anthony Raguz made more than 1,000 fraudulent loans and payments in return bribes, gifts and other kickbacks. More than two dozen people were convicted for their roles in the conspiracy, including Raguz (currently serving 14 years in federal prison) and Koljo Nikolovski (currently serving an 18-year prison sentence), a man who wired more than $2.3 million in ill-gotten money to Macedonia.
Those being honored with the IRS Commendation Award are Assistant U.S. Attorneys John D. Sammon (retired), Bridget M. Brennan, James Morford, Paralegal Specialist Daniel Nugent, IRS Special Agents Frank Brown and Rob Thatcher, FBI Special Agents Derek Kleinmann, Steve Sloan, and Mike West, FBI Forensic Accountant Leann Royal, Eastlake Detectives Ted Kroczak and Chris Bowersock, and FBI TFO John Ypsilantis.
FBI Director James Comey is scheduled to present the awards during a private ceremony in Cleveland on Nov. 25.Johnson County Man Convicted of Tampering with Federal WitnessRead the Press Release
KANSAS CITY, KAN. – A Johnson County man has been convicted of tampering with a witness in a federal criminal case, U.S. Attorney Barry Grissom said today.
A jury found Gary Sparks, 61, Edgerton, Kan., guilty of one count of tampering with a witness. During trial, prosecutors presented evidence that Sparks attempted to persuade his granddaughter to lie to investigators who were investigating his daughter, Stacy Ashley, on drug charges. Ashley pleaded guilty to one count of distributing Oxymorphone. In her plea, she admitted that on July 30, 2011, she distributed Oxymorphone to Joshua Auclair, who died from a drug overdose. Ashley is set for sentencing Dec. 10.
Sparks will be set for sentencing at a later date. She faces a maximum penalty of 20 years in federal prison and a fine up to $250,000.
Grissom commended the Kansas Bureau of Investigation and Assistant U.S. Attorney Sheri McCracken for their work on the case.
James Leroy Daniel Baltierra and Kirk Von Felhaber Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on November 21, 2013, before U.S. District Judge Donald W. Molloy, JAMES LEROY DANIEL BALTERRA, age 31, and KIRK VON FELHABER, age 55, residents of McKinleyville, California, were sentenced.
BALTERRA received the following sentence:
- obation: 5 years - (1 year house arrest)
- ecial Assessment: $100
FELHABER received the following sentence:
- Ison: 6 months (house arrest)
- ecial Assessment: $100
- pervised Release: 3 years
They were sentenced in connection with their guilty pleas to conspiracy to possess with the intent to distribute marijuana.
In an Offer of Proof filed by Assistant U.S. Attorney Jessica T. Fehr, the government stated it would have proved at trial the following:
From the summer of 2008, until the summer of 2010, Joseph Chartraw organized and profited from a marijuana distribution network across Montana. Chartraw had numerous distributors and drug couriers in Montana. Chartraw's source of supply was identified by law enforcement as being in California. Chartraw used his cellular telephone to communicate with everyone in his distribution organization - including his sources of supply in California.
Chartraw's first connection to a group of marijuana growers and distributors in California was FELHABER. FELHABER would bring together multiple growers at his home whenever Chartraw or one of his couriers would be arriving in California. FELHABER would have several individuals bring their marijuana to his home for redistribution to Chartraw or one of his couriers. Patrick McMullen, BALTIERRA, Gregory Harris, and Henry Combs had several grow operations in Californian and were one of the sources of supply for Chartraw through FELHABER. FELHABER was the primary contact for the group and Chartraw until FELHABER refused to provide Chartraw with a title for a vehicle he had sold him. FELHABER then took a lesser role in the distribution - he continued to participate - just in a lesser degree.
At that point McMullen, FELHABER's grandson, took over the organization of deliveries to Chartraw's organization. McMullen was business partners with BALTIERRA. McMullen and BALTIERRA continued to distribute to Chartraw until the Summer of 2010 when Chartraw was arrested in Billings.
Evidence would have proven that more than 100 kilograms of marijuana was possessed by the conspiracy with the intent to distribute.
Chartraw, Harris, McMullen, and Combs pled guilty to federal charges.
The investigation was conducted by the Federal Bureau of Investigation's Big Sky Safe Streets Task Force.
Inmate Sentenced for Assault at Pollock PrisonRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that Samuel Gonzalez, 34, of Luling, Texas, was sentenced Thursday by U.S. District Judge Dee D. Drell, to 110 months in prison and three years of supervised release for assaulting a fellow inmate, causing serious bodily injury. A federal jury found Gonzalez guilty on August 8, 2013 after a two-day trial.
Witness testimony and documents admitted into evidence at trial revealed that on September 6, 2011, at the U.S. Penitentiary in Pollock, La., Gonzalez was observed with another inmate on surveillance video assaulting a third inmate. The victim was repeatedly struck with an edged weapon resulting in nine lacerations to the upper torso and neck. The injured inmate survived and was taken to a local hospital.
The Federal Bureau of Investigation conducted the investigation. Assistant U.S. Attorney Seth D. Reeg prosecuted the case.Indictments Unsealed Charging Four Individuals Associated with Penn National Racetrack with FraudRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced the unsealing of indictments charging three thoroughbred horse trainers and an employee of Penn National Racetrack in Grantville with fraud in connection with horse races at that track. The indictments were returned by a federal grand jury in Harrisburg on Wednesday and were unsealed following arrests of four individuals earlier today.
According to United States Attorney Peter J. Smith, David Wells, 39, of Grantville, Sam Webb, 63, of Jonestown, Patricia Anne Rogers, 43, of Hummelstown, and Danny Robertson, 63, of Hershey, were charged individually in four separate indictments.
Wells, Webb and Rogers, all horse trainers, were charged with allegedly devising a scheme to defraud those betting on thoroughbred races at Penn National Racetrack by attempting to administer, and administering in violation of state racing rules and regulations, substances prohibited from being introduced into a horse within 24 hours of when the horse is scheduled to race.
The indictment also alleges that it is also a violation of state law to rig or attempt to rig a publicly exhibited contest such as a thoroughbred horse race. Races at Penn National Racetrack are simulcast to approximately 116 sites across the United States and in other countries by wire and television to allow bettors to wager on the Penn National races without being in attendance at that track.
According to the indictment, Robertson was employed by the track as the clocker to provide racing officials and others with the official workout times for horses at Penn National, information relied upon by the betting public. The trainers, like the owners, stand to profit financially from the purse offered for that race if the horse that is entered finishes in first, second or third place.
The indictment charging Webb alleges that Webb was detected by track security personnel on May 2, 2013, in a stall at the racetrack in possession of hypodermic syringes, needles and bottles of medications preparing to inject the horse “Papaleo” that Webb trained and which was scheduled to run in the sixth race that day. The horse was scratched from the race by racing officials.
The indictment charging Rogers alleges that Rogers was caught by track security personnel on August 21, 2013, at a stall at the racetrack in possession of hypodermic syringes and needles and bottles of medications and was observed injecting or attempting to inject a substance into a horse named “Strong Resolve” that she trained and that was scheduled to run in the second race that day. The horse was scratched from the race by racing officials. Rogers was also charged with conspiring with a person known to the grand jury to attempt to commit wire fraud.
The indictment charging Wells alleges that Wells, both a trainer and horse owner, for several years up to and including February 2012, would routinely inject prohibited substances into horses he trained and other horses he both trained and owned, by use of hypodermic syringes and needles and otherwise. It is also alleged that Wells was routinely in possession of those prohibited items at the racetrack in violation of state rules, regulations and laws.
The indictment charging Robertson alleges that Robertson was an employee of the racetrack, working in the capacity of clocker whose duties included being present when horses would have their official workout. Robertson was to verify that the horse being timed was the actual horse the trainer represented it to be, to accurately record the distance each horse ran, and the time it ran that distance in and then to provide that information to racing officials for inclusion in the official public daily racing program.
Robertson also allegedly sent the workout time information interstate by wire via computer to Equibase, a Kentucky based company that provides information on a racehorse’s past performance and workout times to media outlets and publications as well as on its own website. The workout time information is allegedly relied upon by the betting public in deciding which horses to wager on in any given race.
The Robertson indictment alleges that Robertson, in exchange for cash given to him by trainers known and unknown to the grand jury, would provide false workout times to racing officials and to Equibase. The times Robertson turned in allegedly, at times, included completely fabricated time for horses that did not workout at all at the track. The indictment alleges Robertson profited personally from the scheme, the betting public was defrauded and Robertson’s employer, Hollywood Casino and Racetrack, was denied of its right to Robertson’s honest services.
The investigation which is continuing is being conducted by the Harrisburg office of the FBI, the Commonwealth of Pennsylvania Department of Agriculture’s Horse Racing Commission, the Pennsylvania State Police, the Dauphin County District Attorney’s Office, and the U.S. Department of Agriculture.
Each defendant faces up to 20 years imprisonment and a $250,000.00 fine if convicted of wire fraud or attempted wire fraud. Each defendant faces an additional 5 years imprisonment and a $250,000.00 fine if convicted of using and attempting to use the intestate wire mechanism provided by the simulcasting of races to defraud or for attempting to defraud the public through the rigging of a publicly exhibited contest in violation of state law. Rogers faces an additional potential 20 year term of imprisonment and a $250,000.00 fine if convicted of the charge of conspiring to commit wire fraud.
Prosecution has been assigned to Assistant U.S. Attorney William A. Behe.
The case has been assigned to Senior U.S. District Court Judge William W. Caldwell.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Illinois Man Pleads Guilty to Distribution of Child Pornography from Xbox StingRead the Press Release
Orlando, Florida– Acting United States Attorney A. Lee Bentley, III announces that Scott Anthony Estes (18, Illinois) today pleaded guilty to distribution of child pornography. He faces a mandatory minimum of 15 years’ imprisonment, up to a maximum penalty of up to 40 years in federal prison.
Estes was indicted on April 17, 2013.According to the plea agreement, Estes began contact with a ten year-old boy on Xbox live. Estes attempted to convince the child to engage in a sexual relationship and sought naked pictures of the child. The child then told his father about the conversation, and the father contacted law enforcement. Law enforcement began an undercover investigation and continued communication with Estes. Estes, believing that he was still talking to the child, sent videos depicting child pornography and images of Estes’ genitalia.
Estes was arrested by law enforcement on March 22, 2013. During an interview, Estes stated that he had met the child while playing a video game played on Xbox. Estes also admitted to sending a picture of his genitalia to the child, as well as child pornography videos, and that he had asked the child to send naked pictures of himself. Estes stated that he had also been in communication with a thirteen year-old boy in Texas and that he had met that child while playing Xbox as well.
Following Estes’ arrest, a search warrant was conducted on his e-mail address. An examination of his e-mail account showed that he distributed child pornography to numerous persons between July of 2012 and March of 2013. Among the images and videos of child pornography distributed, several included pornographic videos that Estes had produced himself, while sexually abusing at least two children. A forensic review of Estes’ cellular telephone showed that he possessed more than 1,200 images of child pornography, including images depicting infants being sexually abused. A majority of the images of child pornography depict children between the ages of three and eight.
This case was investigated by Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Christopher LaForgia.
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 (CEOS), 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.projectsafechildhood.gov.
Illegal Alien in Court for Conspiring to Produce False IDRead the Press Release
Boston – A Dominican man was in court today for his alleged involvement in the identity theft and public corruption investigation related the Massachusetts Registry of Motor Vehicles.
Leonardo Burgos Espinal, 42, most recently residing in Springfield, has been charged by criminal complaint with bribing an employee of the Massachusetts Registry of Motor Vehicles in connection with a scheme to issue Massachusetts driver’s licenses to individuals who presented fraudulently obtained, but valid, Puerto Rican identification documents. It is alleged that this scheme took place between January 2011 and June 2012. This case is the most recent development in investigations involving identity theft and public corruption relating to the Massachusetts Registry of Motor Vehicles.
Burgos Espinal had his initial appearance today and remains in federal custody.
United States Attorney Carmen M. Ortiz; Bruce M. Foucart, Special Agent in Charge Homeland Security Investigations in Boston; Colonel Timothy P. Alben, Superintendent of the Massachusetts States Police; David W. Hall, Special Agent in Charge of the U.S. Department of State, Bureau of Diplomatic Security, Boston Field Office; and Cheryl Garcia, Acting Special Agent in Charge of the U.S. Department of Labor, Office of Inspector General, New York Regional Office, made the announcement today. The case is being prosecuted by Eugenia M. Carris of Ortiz’s Public Corruption Unit.
The details contained in the complaint are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Homestead Man Sentenced to 12 Years in Prison for Shooting at Munhall ClubRead the Press Release
PITTSBURGH – Edward Cook, 26, a Homestead resident, has been sentenced in federal court to 12 years of imprisonment after pleading guilty to violating federal firearms laws, United States Attorney David J. Hickton announced today. This term of imprisonment is to be followed by five years of federal supervised release. United States District Judge Cathy Bissoon imposed the sentence.
According to information presented to the court, on or about Aug. 12, 2012, in the Western District of Pennsylvania and elsewhere, Cook discharged a firearm in furtherance of a one kilogram or more heroin trafficking conspiracy. The shooting to which Cook pled guilty took place at Club Pink, a club in Munhall, Pa.
Assistant United States Attorney Eric S. Rosen prosecuted this case on behalf of the government. U.S. Attorney Hickton commended the Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms, and Explosives, Pennsylvania Office of the Attorney General, City of Pittsburgh Bureau of Police, Pennsylvania State Police, Allegheny County Sheriff's Office, McKeesport Police Department, Munhall Police Department and the West Homestead Police Department for the investigation leading to the successful prosecution and sentencing of Edward Cook.
Gretna Men Sentenced for Conspiracy to Commit BriberyRead the Press Release
ZUHAIR HAMED, age 51, and JIHAD HATEM HAMAD, age 27, both residents of Gretna, Louisiana, were sentenced yesterday by U. S. District Judge Eldon E. Fallon on their guilty pleas to Conspiracy to Bribe an Agent of Local Government in Connection with a Program Receiving Federal Funds, announced U. S. Attorney Kenneth Allen Polite, Jr. ZUHAIR HAMED was sentenced to twenty months imprisonment followed by three years of supervised release, and a fine of $3,000. JIHAD HAMAD was sentenced to six months imprisonment followed by six months of home confinement, three years of supervised release, 50 hours of community service, and a $100 special assessment.
According to court documents, HAMAD was the owner and operator of a convenience store located in Harahan, Louisiana. HAMAD was seeking a permit allowing the sale of wine and hard liquor at his store. HAMED assisted in the efforts of JIHAD HAMAD to obtain the liquor permit. The police chief of the City of Harahan repeatedly stated that he would oppose the issuance of such permit because the convenience store was located within 300 feet of a church, a prohibited distance under Louisiana law and Harahan city ordinance.In March 2012, HAMAD told the police chief that his father was a wealthy man who would be willing to make a contribution to the police chief’s political campaign in exchange for approval of a permit to sell wine and hard liquor at the convenience store. The police chief stated that he thought he knew HAMAD’s father, who had owned a convenience store on Martin Luther King Boulevard in New Orleans. HAMAD agreed that HAMED, in fact, was his father. However, the two men were not related.
Consequently, the police chief considered the offer to provide him with campaign contributions in return for the liquor permit to be an attempt to bribe him. Therefore, the police chief reported the matter to the Federal Bureau of Investigation, which initiated an investigation of the matter.
HAMED then met several times with the police chief, discussed the liquor permit, and offered payments in cash, by blank money order, or by business checks to the police chief’s campaign. In May and June of 2012, HAMAD gave HAMED $3,000 to be used to make payments to the police chief. HAMED then paid the police chief a total of $3,000 in two payments, one in cash, and one by means of a check drawn on the account of a business related to HAMED’s family member, on which check the payee was blank. He also agreed to make additional payments to the police chief in the future.
The case was investigated by the Federal Bureau of Investigation and the U. S. Attorney’s Office. The case was prosecuted by Executive Assistant U. S. Attorney Eileen Gleason.
Georgia Emissions Inspectors Sentenced to Federal PrisonRead the Press Release
ATLANTA – Jerome Clarence Barnes, Jr. and Jared F. Walker have been sentenced in federal court for their roles in a scheme to fraudulently issue emissions certificates for cars that would have failed the emissions inspection required by law.
“Barnes sold his position as a licensed emissions inspector when he took payoffs to issue fake emissions certificates for cars that should have failed the test,” said United States Attorney Sally Quillian Yates. “Thanks to the diligent efforts of the federal EPA and state EPD criminal investigators, this case has put an end to Barnes’ fraudulent scheme and, as a result, removed a persistent threat to Atlanta’s air quality and public health.”
“Violators who submit false reports or incorrect data undermine EPA’s commitment to protect clean air for all Americans,” said Maureen O’Mara, Special Agent in Charge of EPA’s criminal enforcement program in Georgia. “Unfortunately, this case was not an isolated incident; defendant Barnes has a history of this type of criminal behavior. Today’s sentencing demonstrates that those who try to save money by cutting corners will be held responsible for their crimes. EPA will continue working with its law enforcement partners to protect the public and the environment.”
“The vehicle emissions program is important to Georgia’s air quality. EPD works hard to make sure stations and inspectors are performing the tests correctly and complying with the law,” said Jud Turner, Director of Georgia’s Environmental Protection Division. “We appreciate DOJ, EPA and other law enforcement agencies working with us to investigate and prosecute Mr. Barnes and others like him who circumvent the program.”
According to United States Attorney Yates, the charges and other information presented in court: Barnes, 35, of Lithia Springs, Ga., was responsible for issuing over 4,000 fraudulent emissions certificates to car owners in Georgia from September 2011 to September 2012, falsely stating that the owners’ cars passed the required emissions test. Barnes worked with other individuals to open emissions inspection stations in their names that he would then use to issue fraudulent emissions certificates. Opening stations in others’ names helped conceal Barnes’ involvement in the fraudulent activity. He wanted to avoid detection because he previously owned two inspection stations that state authorities had shut down for fraud. When authorities would discover emissions fraud occurring at one of the inspection stations, Barnes continued the fraud at another station that was opened under the name of a different owner. During the scheme, Barnes used On Time Emissions in Fulton County, All Clean Emissions in Cobb County, BDH Emissions in Dekalb County, Elite Emissions in Fulton County, and Cleaner Atlanta Emissions in Cobb County, to conduct fraudulent emissions testing.
Walker, 35, of Austell, Ga., owned All Clean Emissions. He and co-defendants Ieka N. Jones, 33, of Winston, Ga., and Seretha Franklin, 36, of Villa Rica, Ga., were licensed emissions inspectors who worked with Barnes to issue passing emissions certificates to car owners whose cars would have otherwise failed the emissions test. Instead of connecting the owners’ real cars to the emissions equipment, the defendants connected different cars they knew would pass the test. During the tests, the computer system automatically transmitted emissions testing data to a statewide database accessible by the Georgia Environmental Protection Division. The defendants manually entered other information into the system, such as the make, model, and vehicle identification number, to make it appear that they were testing the owners’ real cars, many of which had already failed an emissions test or showed equipment malfunctions. The defendants charged $100 to $125 for a fraudulent emissions test, far more than the usual amount charged for a legitimate inspection. Georgia law prohibits inspection stations from charging more than $25 for an emissions test.
Barnes was sentenced by United States District Judge Timothy C. Batten, Sr. to four years and six months in federal prison and three years of supervised release. Walker was sentenced to six months in federal prison and one year of supervised release. On September 6, 2013, Barnes pleaded guilty to one count of conspiring to commit wire fraud by depriving the State of Georgia and its citizens of their right to his honest services as a licensed emissions inspector. That same day, Walker pleaded guilty to one count of violating the Clean Air Act. On September 30, 2013, Jones and Franklin each pleaded guilty to one count of violating the Clean Air Act. Sentencing for Jones and Franklin is scheduled for December 20, 2013, before Judge Batten.
The Clean Air Act is a federal law that authorizes the United States Environmental Protection Agency to establish air quality standards to protect public health and welfare and to regulate emissions of hazardous air pollutants. As required by the Act, the State of Georgia has established a vehicle emissions testing program that requires cars in several counties be inspected to ensure that their emissions do not exceed limits for hydrocarbons, nitrogen oxide, and other compounds. With certain exceptions, car owners must submit an emissions certificate to obtain their annual vehicle registration. The Clean Air Act prohibits making false statements in records, including emissions certificates and database records, that are required to be maintained by the Act.
This case was investigated by Special Agents of the United States Environmental Protection Agency, Criminal Investigation Division, and the Georgia Department of Natural Resources, Environmental Protection Division.
Assistant United States Attorney Stephen H. McClain 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 Atlanta Division is http://www.justice.gov/usao/gan/.
Ft. Thompson Man Sentenced for Assaulting, Resisting and Impeding A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Ft. Thompson, South Dakota, man convicted of Assaulting, Resisting and Impeding a Federal Officer was sentenced on November 20, 2013, by U.S. District Judge Roberto A. Lange.
Patrick Wind, a/k/a Patrick Azure, age 21, was sentenced to 13 months of imprisonment, 18 months of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Wind was indicted for the above charge by a federal grand jury on June 12, 2013, and he pled guilty on August 28, 2013.
The conviction stems from an incident on June 4, 2013, wherein a Bureau of Indian Affairs (BIA) officer was dispatched to a home in Lower Brule, responding to a report of a passed out male on the front porch of a residence. The officer made contact with the male, later identified as Wind. Wind was placed under arrest for public intoxication and Wind became noncompliant.
Once handcuffed, Wind lunged at the officer, kicking and swearing at the officer who attempted to put him in the car. Two additional BIA officers arrived on scene, and as one of them was attempting to put leg restraints on Wind, he continued to resist by spitting and kicking at the officers. Wind continued to resist the entire time.
The investigation was conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Wind was immediately turned over to the custody of the U.S. Marshals Service.
Forty-Fifth Defendant in Operation Garlic Press SentencedRead the Press Release
SAN JOSE – Zanaida Perales, one of 45 defendants charged federally in Operation Garlic Press, a multi-agency law enforcement initiative that was conducted in Gilroy, California in October 2011, was sentenced yesterday in federal court, United States Attorney Melinda Haag announced.
The sentence was handed down by The Honorable D. Lowell Jensen, United States District Court Judge, in San Jose. Perales pleaded guilty on August 1, 2013, to using an interstate facility in furtherance of a drug felony, in violation of 21 U.S.C. Section 843(b). She was sentenced to 36 months in prison to be followed by one year of supervised release.
Another Garlic Press defendant, Adolpho Cornejo Vasquez, absconded after receiving pretrial release, and remains a fugitive. He is charged with conspiracy to distribute methamphetamine, and distribution of methamphetamine. A warrant has issued for his arrest in criminal case number CR 11-00658 LHK. Anyone with information on his whereabouts should contact the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) at (408) 882-5200 or the Gilroy Police Department at (408) 846-0300.
In March, 2010, the ATF began an undercover operation with the Gilroy Police Department and the California Highway Patrol. That operation targeted individuals, including gang members, who commit violent criminal acts. The investigation focused on individuals operating in the California counties of Santa Clara, Santa Cruz, Monterey and San Benito. Prosecutors from the United States Attorney’s Office and the Santa Clara District Attorney’s Office, working together, charged a total of 118 defendants. The federal operation’s primary objective was to target subjects who traffic in firearms and narcotics, primarily methamphetamine, while the state focused on vehicles that had been stolen or were the subject of insurance fraud. Among the items seized were 86 vehicles, 52 firearms (including several sawed off shotguns, stolen firearms, and firearms with obliterated serial numbers) and methamphetamine, much of which was extremely pure (some100%), with a street value of more than $100,000.
In addition to Perales, 44 other federal defendants in this case have been convicted and sentenced as detailed below. For reference, Title 21 offenses address distribution and/or possession with the intent to distribute controlled substances (in these cases methamphetamine); Title 18 and Title 26 offenses address illegal possession and/or sale of firearms.
- Arianna Baca pled guilty on July 26, 2012, to violations of 21 USC 841 and 846. Baca was sentenced November 1, 2012, to 78 months in prison, to be followed by 48 months of supervised release
- Izaeus Banda pled guilty on March 12, 2012, to a violation of 21 USC 841. Banda was sentenced on June 4, 2012, to 60 months in prison, to be followed by 60 months of supervised release.
- Scott Burns pled guilty on March 12, 2012, to violations of 18 USC 922(g)(1), 26 USC 5861, and 21 USC 841. Burns was sentenced on June 4, 2012, to 100 months in prison, to be followed by 60 months of supervised release.
- Frank Cardenas pled guilty on April 23, 2012, to violations of 18 USC 922(g)(1) and 21 USC 841. Cardenas was sentenced on July 9, 2012, to 60 months in prison to be followed by 60 months of supervised release.
- Arturo Cervantes pled guilty on April 2, 2012, to violations of 26 USC 5861 and 21 USC 841. Cervantes was sentenced on August 6, 2012, to 60 months in prison to be followed by 60 months of supervised release.
- Christina Chavez, pled guilty on Aug 6, 2012, to a violation of 21 USC 844(a). Chavez was sentenced on November 5, 2012, to 24 months in prison to be followed by 12 months of supervised release.
- Yvonne Chavez pled guilty on July 9, 2012, to violations of 21 USC 841 and 846. Chavez was sentenced on February 25, 2013, to 96 months in prison to be followed by 60 months of supervised release.
- Juan Chavez-Ornelas pled guilty on March 5, 2012, to violations of 21 USC 841 and 846, as well as 8 USC 1326. Chavez-Ornelas was sentenced on August 6, 2012 to 87 months in prison, to be followed by 60 months of supervised release.
- Rodolfo Contreras pled guilty on March 14, 2012, to a violation of 21 USC 841. Contreras was sentenced on May 30, 2012, to 60 months in prison, to be followed by 60 months of supervised release.
- Melissa Duarte pled guilty on July 19, 2012, to violations of 21 USC 841 and 846. Duarte was sentenced on February 14, 2013 to 74 months in prison, to be followed by 48 months of supervised release.
- Dagoberto Duran pled guilty on March 22, 2012, to violations of 21 USC 841 and 846. Duran was sentenced on August 9, 2012 to 72 months in prison, to be followed by 60 months of supervised release.
- Desiree Flores pled guilty on June 28, 2012, to violations of 21 USC 841 and 846. Flores was sentenced on November 15, 2012, to 60 months in prison, to be followed by 60 months of supervised release.
- Joshua Flores pled guilty on March 7, 2012, to violating 21 USC 841. He was sentenced on May 23, 2012, to 180 months in prison, to be followed by120 months of supervised release.
- Raymond Gallegos pled guilty on Oct. 1, 2012, to violations of 21 USC 841; and 846. He was sentenced on February 23, 2012, to 100 months in prison, to be followed by120 months of supervised release.
- Adrian Gamino pled guilty on Dec. 21, 2011, to violations of 21 USC 841 and 846. He was sentenced on March 7, 2012, to 240 months in prison, to be followed by120 months of supervised release.
- Lorenzo Garcia pled guilty on April 18, 2012, to violations of 21 USC 841 and 846. He was sentenced on June 5, 2013, to 120 months in prison, to be followed by 60 months of supervised release.
- Jose Gonzalez pled guilty on Aug. 29, 2012, to violations of 18 USC 922(g)(1) and 21 USC 841 and 846. He was sentenced on January 23, 2013, to 80 months in prison, to be followed by 48 months of supervised release.
- Miguel Gonzalez pled guilty on December 21, 2011, to violations of 21 USC 841 and 846. He was sentenced on March 7, 2012 to 240 months in prison, to be followed by 120 months of supervised release.
- Gustavo Hernandez pled guilty on May 14, 2012, to violations of 21 USC 841 and 846. He was sentenced on Sept. 10, 2012 to 60 months in prison, to be followed by 48 months of supervised release.
- Maria Hernandez pled guilty on October 31, 2012, to violations of 21 USC 841 and 846. She was sentenced on March 20, 2013, to 60 months in prison, to be followed by 48 months of supervised release.
- Simon Hernandez pled guilty on May 21, 2012, to violating 21 USC 841. He was sentenced on Aug 6, 2012, to 84 months in prison, to be followed by 120 months of supervised release.
- Frank Herrera pled guilty on April 2, 2012, to violations of 18 USC 922(g)(1) and 922(k). He was sentenced on June 18, 2012, to 57 months in prison, to be followed by 36 months of supervised release.
- Henry Jones pled guilty on March 5, 2012, to violations of 18 USC 922(g)(1) and 922(k). He was sentenced on May 21, 2012, to 57 months in prison, to be followed by 36 months of supervised release.
- Ricardo Landecho pled guilty on Dec. 3, 2012, to violations of 21 USC 841and 846. He was sentenced on April 18, 2013, to 100 months in prison, to be followed by 48 months of supervised release.
- Frank Machado pled guilty on Jan. 19, 2012, to violations of 21 USC 841 and 846. He was sentenced on March 22, 2012 to 60 months in prison, to be followed by 60 months of supervised release.
- Diana Mayoral pled guilty on May 10, 2012, to violations of 21 USC 841 and 846. She was sentenced on November 29, 2012 to 6 months in prison, to be followed by 48 months of supervised release.
- Rosa Martinez pled guilty of June 7, 2012, to violations of 21 USC 841 and 846. She was sentenced on November 15, 2012, to 70 months in prison, to be followed by 48 months of supervised release.
- Joshua Moore pled guilty on April 19, 2012, to violations of 21 USC 841 and 21 USC 846. He was sentenced on Nov. 29, 2012 to 60 months in prison, to be followed by 60 months of supervised release.
- Addel Montero pled guilty on June 18, 2012, to violating of 21 USC 841 and was sentenced on October 1, 2012, to 72 months in prison, to be followed by 48 months of supervised release.
- Hugo Mora pled guilty on July 11, 2012, to violating of 21 USC 841. He was sentenced on September 26, 2012, to 68 months in prison, to be followed by 48 months of supervised release.
- KC Pries pled guilty on March 12, 2012, to violations of 18 USC 922(g)(1) and 26 USC 5861. Pries was sentenced in June 4, 2012 to 63 months in prison, to be followed by 36 months of supervised release.
- Enrique Quintero pled guilty on July 9, 2012, to violations of 21 USC 841 and 846. He was sentenced on October 15, 2012, to 240 months in prison, to be followed by 120 months of supervised release.
- Rigoberto Ramirez pled guilty on July 16, 2012, to violations of 18 USC 922(g)(1) and 21 USC 841. He was sentenced on October 22, 2012 to 60 months in prison, to be followed by 120 months of supervised release.
- Robert Reddick pled guilty on Feb. 23, 2012, to violating 18 USC 922(g)(1). He was sentenced on June 7, 2012, to 9 months in prison, to be followed by 24 months of supervised release.
- Cala Remick pled guilty on July 12, 2012, to violations of 21 USC 841 and 846. She was sentenced on December 12, 2012, to 30 months in prison, to be followed by 36 months of supervised release.
- Everardo Robles pled guilty on February 16, 2012, to violations of 18 USC 922(g)(1) and 21 USC 846. He was sentenced on May 3, 2012, to 108 months in prison, to be followed by 120 months of supervised release.
- Jose Romero pled guilty on July 26, 2012, to violations of 18 USC 922(g)(1), 26 USC 5861(d) and 21 USC 841. He was sentenced on November 5, 2012, to 84 months in prison, to be followed by120 months of supervised release.
- Michael Ruelas pled guilty on April 18, 2012, to violations of 18 USC 922(g)(1) as well as 21 USC 841 and 846. He was sentenced on April 17, 2013, to 90 months in prison, to be followed by 48 months of supervised release.
- David Sainz pled guilty on July 26, 2012, to violations of 21 USC 841 and 846. He was sentenced on November 5, 2012, to 188 months in prison, to be followed by 60 months of supervised release.
- Jimmy Sandoval pled guilty on March 1, 2012, to violations of 21 USC 841 and 846. He was sentenced on May 31, 2012, to 70 months in prison, to be followed by 48 months of supervised release.
- Leonardo Silga pled guilty on March 19, 2012, to violations of 18 USC 922(g)(1) and 21 USC 846. He was sentenced on October 1, 2012, to 240 months in prison, to be followed by 120 months of supervised release.
- Lilia Valderrama pled guilty on December 21, 2012, to violations of 21 USC 841 and 846, and 18 USC 922(g)(1). She was sentenced on March 13, 2013, to 68 months in prison, to be followed by 48 months of supervised release.
- Paul Zabala pled guilty on March 29, 2012, to violations of 21 USC 841 and 846. He was sentenced on July 12, 2012, to 180 months in prison, to be followed by 120 months of supervised release.
- Ruben Macias Chavez convicted of 18 USC 922(g). He was sentenced on April 8, 2013, to 12 months in prison, to be followed by 3 years of supervised release.
Please note: Any sentence following conviction is imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Thomas O’Connell and Daniel Kaleba are the Assistant U.S. Attorneys who are prosecuting the cases with the assistance of Tracey Andersen and Nina Williams. The prosecution is the result of a one and one-half year investigation by ATF and the Gilroy Police Department.
In addition to the ATF and the Gilroy Police Department, the following agencies provided support to this investigation: the California Highway Patrol; Salinas Police Department; Morgan Hill Police Department; Monterey County Sheriff’s Office; auto theft task forces from Monterey County, Santa Cruz County and Santa Clara County; the National Insurance Crime Bureau; the Western States Information Network; the High Intensity Drug Trafficking Area task force; the United States Marshal’s Service; and U.S. Immigration and Customs Enforcement (ICE).
(Perales information )
Former Wichita Area Physician ConvictedOn Federal Firearm and Drug ChargesRead the Press Release
WICHITA, KAN. – A former Wichita area physician who was serving time on supervised release for a drug conviction has been convicted on federal firearm and drug charges, U.S. Attorney Barry Grissom said today.
A jury found Lawrence M. Simons, 57, Wichita, Kan., guilty on one count of unlawful possession of a firearm after a felony conviction and one count of unlawful possession of controlled substances.
During trial, prosecutors presented evidence that in 2009 Simons, a former employee of the Schneider Medical Clinic in Haysville, Kan., pleaded guilty to two counts of unlawfully distributing controlled substances. In January 2010, Simons was sentenced to 24 months in federal prison to be followed by three years on supervised release.
In April 2013 an agent of the Bureau of Alcohol, Tobacco, Firearms and Explosives learned that Simons had given a pistol to Steven Woodin, proprietor of S&F Bail Bonds in Wichita. Simons owed Woodin for bonding him out of jail on a $25,000 bond in a Sedgwick County District Court case involving a charge of making a criminal threat.
Prosecutors also presented evidence that on Aug. 7, 2008, Simons signed a Drug Enforcement Administration form surrendering his controlled substances privileges. On Aug. 21, 2009, Simons leased three storage units at the West Kellogg Stor-All where he stored personal property. Controlled substances later were found in the storage units including Fentanyl, Actiq, Lortab Elixer, Ketamine, Versed, Midazolam, Brevital Sodium, Diazepam, Stadol and Niravan.
Sentencing is set for Feb. 10, 2014. He faces a maximum penalty of 10 years in federal prison and a fine up to $250,000 on each firearm count, and a maximum penalty of two years and a fine of not less than $2,500 on the drug count. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.
Former Real Estate Developer and his Long-Time Girlfriend Sentenced to Prison for Tax Evasion SchemeRead the Press Release
A former western Washington real estate developer and his long-time girlfriend were sentenced today in U.S. District Court in Seattle for 25 counts of tax evasion and false statements related to their scheme to avoid paying taxes on more than $23 million in income, announced U.S. Attorney Jenny A. Durkan. WINSTON BONTRAGER, 64, was sentenced to 11 years in prison and three years of supervised release. His long-time girlfriend, PAULINE ANDERSON, 65, was sentenced to 39 months in prison. As an Australian citizen, she likely will be deported following her prison term. Both will share a restitution obligation of $2,717,510. The couple was indicted in March 2012, and both have been in federal custody since June 2012. They were convicted following a four week jury trial in July 2013. At sentencing U.S. District Judge Richard A. Jones said to BONTRAGER, “You were a one man wrecking ball in the lives of many people... You believed you had immunity from restitution and tax obligations... You lived the lifestyle of the rich and famous while lying and cheating to avoid tax obligations.”
“This is Mr. Bontrager’s third conviction and sentencing hearing before a federal judge in Western Washington,” said U.S. Attorney Jenny A. Durkan. “Despite having more than enough money to pay his taxes and his debt to society, this defendant brazenly thumbed his nose at every governmental agency and institution that he came into contact with, by lying, cheating and deceiving them, for one sole purpose: greed.”
BONTRAGER was previously convicted in 1983 for bank fraud and in 1994 for defrauding the Oregon Public Employees Retirement System and the IRS of over $687,000. In 1994 he was sentenced to 40 months in prison. BONTRAGER made numerous false statements surrounding his failure to pay more than $687,000 in restitution from his prior conviction. During the trial prosecutors detailed how BONTRAGER and ANDERSON filed false tax returns from 2004-2009, failing to report more than $23 million in income and failing to pay more than $2.7 million in taxes. Over $10 million was moved into foreign bank accounts in PAULINE ANDERSON’s name, and virtually all of the couples’ assets were put in ANDERSON’s name in order to hide it from the IRS and those seeking to enforce BONTRAGER’s restitution obligation and collect delinquent taxes. At the same time that the couple paid little in income taxes, they purchased a luxury condominium in Bellevue and spent approximately $500,000 on an extensive remodel. They owned a $325,000 wine collection, a $1.2 million home in Southern California, a 6.7 carat diamond ring, a Bentley worth $186,000, and they spent over $3.4 million in credit card purchases, including travel, cosmetic surgery, cosmetic dentistry, restaurants, and clothing and shoes.
At trial prosecutors described various development deals in Vancouver, Washington where BONTRAGER made millions of dollars, in some instances defrauding business partners as well as the IRS.“Mr. Bontrager refused to pay court-ordered restitution to his victims from a previous fraud conviction. Mr. Bontrager clearly failed to learn his lesson and continued to commit fraud. In his latest scheme, he defrauded his new business partners and the American taxpayers. He also enlisted the help of Ms. Anderson to conceal his fraud and ill-gotten gains,” said Kenneth Hines, Special Agent in Charge of IRS Criminal Investigation in Seattle. “Today's sentences show that greed is a powerful emotion that cloud judgment and motivate people to abuse the trust of others.”
BONTRAGER was convicted of nine tax counts and eight counts of making false statements. ANDERSON was convicted of 11 tax counts.
The case was investigated by the Internal Revenue Service Criminal Investigation. The case was prosecuted by Assistant United States Attorney Carl Blackstone.Former Massachusetts Attorney Convicted of Mortgage FraudRead the Press Release
BOSTON - A Pennsylvania man, formerly an attorney practicing in Boston, was convicted of mortgage fraud.
Charles R. Sammon, 37, of West Pittston, Penn., pleaded guilty before U.S. District Judge Richard G. Stearns to 13 counts of wire fraud, mail fraud and money laundering, all in connection with the mortgage fraud scheme that occurred in 2006 and 2007.
Sammon participated in at least 13 fraudulent real estate transactions involving triple-decker apartment buildings in various sections of Boston, including Dorchester, Roxbury and Jamaica Plain. For eight of those transactions, Sammon served as the real estate closing attorney representing the mortgage lender. For the other five, Sammon participated as the seller of real property himself. The basic scheme involved recruiting people to buy properties by promising to pay them as much as $40,000 per transaction, which payments were not disclosed to the lenders. Many of the buyers were also promised that the seller would pay the mortgage for upwards of a year. Also central to the scheme was representing to the lenders that each borrower intended to occupy the property as his or her primary residence, when that was not the case, as Sammon knew.Many of the payments to buyers were made directly from Sammon’s law firm bank account on transactions for which he was the closing attorney, but Sammon failed to disclose those payments to the mortgage lenders that he represented. Sammon also received some of the loan proceeds in addition to his legal fees, which was not disclosed to the lender. In one transaction, he received more than $50,000.
Each of the loans for these 13 transactions went into default, and all the properties were sold at foreclosure or through a short sale, resulting in combined losses to the lenders of more than $2.5 million.
Sentencing is scheduled for Feb. 19, 2014. Sammon faces a maximum sentence of 20 years in prison, to be followed by three years of supervised release and a $250,000 fine on each of the mail and wire fraud charges, and 10 years in prison, three years of supervised release and a $250,000 fine on the money laundering charge.
United States Attorney Carmen M. Ortiz; John Collins, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; Kevin Niland, Inspector in Charge of the United States Postal Inspection Service; Steven Ricciardi, Special Agent in Charge of the United States Secret Service; and Fred W. Gibson, Jr., Acting Inspector General of the Federal Deposit Insurance Corporation, made the announcement today.
The case is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard of Ortiz’s Economic Crimes Unit and DOJ Trial Attorney Alexander H. Berlin.
Former Law Enforcement Officer Sentenced to 40 YearsRead the Press Release
Hammond, Indiana - United State Attorney David Capp announced that former police officer John Smith, 56, of Indianapolis, Indiana, was sentenced today to 40 years imprisonment for using police credentials and firearms to protect drug shipments.
In June, 2013, Smith was found guilty at trial of the felony offenses of conspiracy to possess with intent to distribute and distribute 5 kilograms or more of cocaine, two counts of attempting to possess with intent to distribute 5 kilograms or more of cocaine, two counts of possessing firearms in furtherance of a federal drug trafficking crime, and transferring firearms knowing that they would be used in a drug trafficking crime.
Smith had previously served as a police officer with three different Indiana departments:Brooklyn, Knightstown, and Stinesville.The conduct for which Smith was convicted occurred after he had left those departments.Smith, however, continued to illegally utilize his formerly issued police credentials in these drug transactions.
Terry Carlyle, a former Marshal with the Brooklyn, Indiana Police Department and police officer with the Indianapolis Police Department, was a co-conspirator with Smith.Carlyle, who cooperated with the government, was sentenced in September, 2013 to 10 years of imprisonment.
USA Capp stated, “We will continue to investigate public corruption, including police corruption, and will vigorously prosecute and, upon conviction, seek substantial sentences for officers, current or former, who abuse the public trust.”
These charges were filed as the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives Indianapolis Field Office, the Indianapolis Metropolitan Police Department, the Indiana State Police, with the assistance of the ATF Chicago Field Office, the ATF Merrillville Field Office, the ATF HIDTA Task Force, the Gary Police Department, the Hammond Police Department, the East Chicago Police Department, and the Lake County Police Department.This case was prosecuted by Assistant United States Attorneys David Nozick and Gary Bell.
Former High School Football Player Pleads Guilty to Making Racially Motivated Threats to African-American Assistant Football CoachRead the Press Release
Jonathan Caine, 20, of Nashville, Tenn., pleaded guilty today to a federal hate crime for making racially motivated threats to an African-American assistant football coach at a local high school, the Justice Department announced.
Caine, formerly a student and football player at the high school where the victim works as a coach, pleaded guilty to threatening the victim with violence because of the victim’s race and employment before U.S. Magistrate Judge John Bryant in federal court in Nashville, Tenn.
According to the information presented in court, Caine made repeated anonymous threats to the assistant coach, and others in the high school administration, which included racial slurs and references to violent acts. In court, Caine admitted that on Aug. 10, 2012, he left an anonymous threatening voice mail on the assistant coach’s cellular phone, saying, “And thus sayeth the Lord all [epithet] shall be killed. Amen, amen I say to you [unintelligible] as the Lord Christ says if a [epithet] shall be born unto thee, the [epithet] shall be killed.” Caine admitted that he targeted the coach because of the coach’s race. Prior to law enforcement identifying Caine as the caller, the team took security measures to protect the coach.
“The Department of Justice will not hesitate to prosecute such acts of hate-motivated intimidation,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Hate crimes have no place in our society; not only did this former student and player threaten his coach’s safety, he violated the victim’s civil rights by using racist, discriminatory language. The Civil Rights Division will remain vigilant in our efforts to bring these individuals to justice.”
“When individuals choose to act out their hatred by making threats based on a person’s race, they can expect to face prosecution by the U.S. Attorney’s Office,” said U.S. Attorney David Rivera for the Middle District of Tennessee. “Every arm of the Justice Department is committed to protecting the civil rights of all individuals and insuring they remain free from acts of violence and intimidation when those acts are based on the color of their skin.”
Sentencing is scheduled for Feb. 24, 2014. Caine faces a statutory maximum penalty of a 12-month sentence in prison and a $100,000 fine.
The case was investigated by the Nashville Division of the FBI and is being prosecuted by Assistant U.S. Attorney Blanche Cook of the Middle District of Tennessee and Trial Attorney Nicholas Murphy of the Civil Rights Division.
Former High School Football Player Pleads Guilty to Making Racially Motivated Threats to African-American Assistant Football CoachRead the Press Release
WASHINGTON – Jonathan Caine, 20, of Nashville, Tenn., pleaded guilty today to a federal hate crime for making racially motivated threats to an African-American assistant football coach at a local high school, the Justice Department announced.
Caine, formerly a student and football player at the high school where the victim works as a coach, pleaded guilty to threatening the victim with violence because of the victim’s race and employment before U.S. Magistrate Judge John Bryant in federal court in Nashville, Tenn.
According to the information presented in court, Caine made repeated anonymous threats to the assistant coach, and others in the high school administration, which included racial slurs and references to violent acts. In court, Caine admitted that on Aug. 10, 2012, he left an anonymous threatening voice mail on the assistant coach’s cellular phone, saying, “And thus sayeth the Lord all [epithet] shall be killed. Amen, amen I say to you [unintelligible] as the Lord Christ says if a [epithet] shall be born unto thee, the [epithet] shall be killed.” Caine admitted that he targeted the coach because of the coach’s race. Prior to law enforcement identifying Caine as the caller, the team took security measures to protect the coach.
“The Department of Justice will not hesitate to prosecute such acts of hate-motivated intimidation,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “Hate crimes have no place in our society; not only did this former student and player threaten his coach’s safety, he violated the victim’s civil rights by using racist, discriminatory language. The Civil Rights Division will remain vigilant in our efforts to bring these individuals to justice.”
“When individuals choose to act out their hatred by making threats based on a person’s race, they can expect to face prosecution by the U.S. Attorney’s Office,” said U.S. Attorney David Rivera for the Middle District of Tennessee. “Every arm of the Justice Department is committed to protecting the civil rights of all individuals and insuring they remain free from acts of violence and intimidation when those acts are based on the color of their skin.”
Sentencing is scheduled for Feb. 24, 2014. Caine faces a statutory maximum penalty of a 12-month sentence in prison and a $100,000 fine.
The case was investigated by the Nashville Division of the FBI and is being prosecuted by Assistant U.S. Attorney Blanche Cook of the Middle District of Tennessee and Trial Attorney Nicholas Murphy of the Civil Rights Division.
Former Credit Suisse Managing Director Sentenced in Manhattan Federal Court to 30 Months in Prison in Connection with Scheme to Hide Losses in Mortgage-Backed Securities Trading BookRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that KAREEM SERAGELDIN, the former Managing Director/Global Head of Structured Credit in the Investment Banking Division of Credit Suisse Group (“Credit Suisse”), was sentenced today to 30 months in prison in connection with a scheme to hide more than $100 million in losses in a mortgage-backed securities trading book at Credit Suisse. The bonds at issue in Credit Suisse’s trading book comprised subprime residential mortgage backed securities (“RMBS”) and commercial mortgage backed securities (“CMBS”). Once discovered, SERAGELDIN’s manipulation of these bond prices contributed to Credit Suisse taking a $2.65 billion write-down of its 2007 year-end financial results. In April 2013, SERAGELDIN was extradited from the United Kingdom and pled guilty to conspiring to falsify the books and records of the bank before U.S. District Judge Alvin K. Hellerstein. SERGAGELDIN’s co-conspirators, David Higgs and Salmaan Siddiqui, have also pled guilty and are awaiting sentencing.
Manhattan U.S. Attorney Preet Bharara said: “With today’s sentence Kareem Serageldin will now pay a steep price for the role he played in a conspiracy to cover up more than one hundred million dollars in subprime mortgage-related losses – the loss of his liberty.”
According to the Indictment filed against SERAGELDIN and the Informations to which Higgs and Siddiqui pled guilty, other court documents, and statements made during court proceedings:
SERAGELDIN was employed at Credit Suisse as a Managing Director. He held the position of Global Head of the Structured Credit Group in the Securities Department of Credit Suisse’s Investment Banking Division, and divided his time between the company’s New York and London offices. The Structured Credit Group held and traded ABS (“Asset Backed Security”) cash bonds, which included RMBS and CMBS. SERAGELDIN oversaw and
managed a number of trading books, including a trading book known as “ABN1.” The ABN1 book comprised primarily several thousand individual long and short subprime-related positions, as well as other securities. The long positions consisted of, among other things, various types of cash securities, including AAA-rated and non-AAA-rated cash bonds. Until March 2008, ABN1 had a net asset value of approximately $5.35 billion, approximately $3.71 billion of which consisted of ABS cash bonds, including RMBS and CMBS positions.
Pricing of Mortgage-Backed Securities
Credit Suisse traders were required at all relevant times to price securities they held at their fair value, that is, on a “mark-to-market” basis, which was determined by reference to either the current market price of the asset or liability, or the current price for a similar asset or liability. In the absence of a liquid market, Credit Suisse traders were required to look to other indicia in order to determine the fair value of the assets on their books. During this time, the ABX Index served as a benchmark for certain securities backed by home loans. It was widely understood within Credit Suisse that traders were to consult the corresponding ABX indices when pricing RMBS bonds and related products.
The Bond Pricing Scheme
The deterioration throughout 2007 of the real estate market in the United States, including the subprime housing market, led to significant reductions in valuations of mortgage-backed securities. As mortgage delinquencies increased across the country, the value of the securities backed by these mortgages decreased and the market for them became increasingly illiquid.
By late November 2007, SERAGELDIN was aware that the market for mortgage-backed securities had declined enormously. On November 28, 2007, SERAGELDIN told Higgs, Siddiqui, and a co-conspirator (“CC-1”) that “the housing market [was] going down the tubes” and that they had to “find a way to sell these bonds,” i.e., mortgage-backed bonds in ABN1. As SERAGELDIN recognized, “[t]hose bonds are going to start trading worse than the [ABX] Index.” SERAGELDIN and his co-conspirators did not sell the bonds because the market prices for the bonds were substantially below the inflated value at which they marked the bonds.
From August 2007 through February 2008, SERAGELDIN, Higgs, Siddiqui, and their co-conspirators artificially increased the price of bonds in order to create the false appearance of profitability in the ABN1 trading book. Specifically, SERAGELDIN directed Higgs on numerous occasions to reach specific Profit & Loss (“P&L”) targets on a daily and month-end basis. Higgs, in turn, instructed Siddiqui and another unnamed co-conspirator to mark the books so as to achieve the particular P&L targets specified by SERAGELDIN, rather than to reflect the fair value of the bonds.
Credit Suisse’s ABN1 Trading Book Was Falsely Inflated as a Result of the Scheme
As a result of the scheme, there was a growing disparity between the values ascribed to the marks in the ABN1 book and the available external benchmarks such as the ABX Index. From August 2007 through the end of that year, as ABX Index prices fell, bond prices in ABN1 that were supposed to reflect the ABX Index remained effectively stable, thereby giving the false impression to Credit Suisse senior management that the ABN1 book was profitable. On one occasion in January 2008, SERAGELDIN expressed concern to Higgs that the overpriced bonds were at risk of being discovered: “We should mark these down because someone is going to spot this,” he said.
The February 2008 Mark-Down
On March 20, 2008, Credit Suisse issued a press release that announced completion of its internal review and stated that the fair value reduction, or write-down, of the ABS positions – which included, but was not limited to, the ABNl book – was approximately $2.65 billion. Approximately $540 million of this write-down was attributable to the ABN1 trading book, and included ABS cash bonds for the fourth quarter 2007 that SERAGELDIN manipulated and inflated in connection with his scheme.
In addition to the prison term, Judge Hellerstein sentenced SERAGELDIN, 40, a citizen of the United Kingdom, to two years of supervised release. SERAGELDIN also was ordered to pay forfeiture in the amount of $1 million, a $150,000 fine, and a $100 special assessment.
Mr. Bharara praised the work of the Federal Bureau of Investigation and thanked the Securities and Exchange Commission for its assistance in the investigation of this case.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant United States Attorney Eugene Ingoglia is in charge of the prosecution. This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Former Bookkeeper Sentenced to Federal Prison for EmbezzlementRead the Press Release
Rosalie Seabolt stole more than $800,000 from Roane County oil and gas company
CHARLESTON, W.Va. – A former Spencer-based oil and gas company bookkeeper who stole more than $800,000 from her employer was sentenced yesterday to two years in federal prison, announced U.S. Attorney Booth Goodwin. Rosalie J. Seabolt, 60, of Spencer, W.Va., previously pleaded guilty to mail fraud in August. Seabolt was employed at Kimco, Inc. and its affiliate, Roy G. Hildreth and Son, Inc. (“Hildreth”) for more than 25 years. During her employment at Kimco, Seabolt eventually became the company’s bookkeeper.
From approximately September 9, 2000 and continuing through December 24, 2012, Seabolt wrote numerous unauthorized checks to herself from Kimco’s bank account. During the scheme, Seabolt deposited and cashed these checks at her personal credit union. Seabolt hid the unauthorized checks from Kimco by writing false information in the company’s books that indicated the checks were made to Hildreth as a business expense.
“Small businesses are the lifeblood of our state’s economy,” U.S. Attorney Booth Goodwin said. “That's why my office has focused on investigating and prosecuting cases like these, to protect small businesses and to send a clear message that stealing from those business carries serious consequences."
From at least 2000 through 2012, Poca Valley Bank mailed monthly bank statements to Kimco that included check images. Seabolt, who was in charge of reviewing the monthly bank statements, altered the statements by covering up the check images that revealed unauthorized checks she had written to herself. Also during the scheme, Seabolt destroyed portions of original bank statements the company had received from the bank.
On January 10, 2013, Seabolt told law enforcement that she had defrauded Kimco. In total, Seabolt took at least $815,693.27 of monies from the company between 2000 and 2012.
At sentencing, United States District Judge John T. Copenhaver, Jr. ordered Seabolt to pay full restitution in the amount of $815,693.27 to Kimco.
The investigation was conducted by the FBI and the West Virginia State Police. Assistant United States Attorneys Meredith George Thomas and Philip Wright handled the prosecution.
This case was prosecuted as part of the United States Attorney’s Office for the Southern District of West Virginia’s Small Business Protection Initiative. U.S. Attorney Booth Goodwin announced the Small Business Protection Initiative in November 2010. The initiative focuses on the prosecution of individuals who defraud small West Virginia businesses located within the Southern District.
Former Bank Executive Admits Receiving Bribes from Oxford Collection AgencyRead the Press Release
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Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that WILBUR TATE III, 49, of Dacula, Ga., pleaded guilty today before U.S. District Judge Stefan R. Underhill in Bridgeport to receiving bribes while he was an executive at U.S. Bank in Ohio.
According to court documents and statements made in court, Oxford Collection Agency was a private financial services company that engaged in accounts receivables management, primarily debt collecting, with offices in New York, Pennsylvania and Florida. Between 2007 and 2011, Oxford Collection Agency executives engaged in a multi-year scheme to defraud its lender, investors and clients. The investigation also revealed that Oxford Collection Agency was actively involved in bribing bank officials.
TATE, an Assistant Vice President of U.S. Bank in Ohio from January 2004 through February 2011, was in charge of outsourcing collection accounts to collection agencies, including Oxford Collection Agency. Beginning in approximately August 2008 and continuing for more than two years, Oxford Collection Agency executives engaged in a bribery scheme with TATE in order to obtain and retain the business of U.S. Bank. As part of the scheme, Oxford executives initially provided TATE with boxes of expensive cigars, and subsequently sent TATE monthly cash payments of between $2,500 and $5,000, which were hidden in cigar boxes and mailed to TATE’s residence in Mason, Ohio.
U.S. Bank received funds through the Troubled Asset Relief Program (TARP).
TATE was arrested on February 27, 2013. Today, he pleaded guilty to one count of conspiracy to commit bank bribery, which carries a maximum term of imprisonment of five years. Judge Underhill has scheduled sentencing for February 18, 2014.
Six other individuals have been convicted as a result of this investigation and prosecution of criminal activity arising from Oxford Collection Agency and the debt collection industry.
This ongoing investigation is being conducted by the Internal Revenue Service – Criminal Investigation, the Federal Bureau of Investigation, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and the Connecticut Securities, Commodities, and Investor Fraud Task Force. The case is being prosecuted by Assistant U.S. Attorney Liam Brennan and Special U.S. Attorney John McReynolds
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[email protected]Federal Grand Jury in Fort Wayne Returns IndictmentRead the Press Release
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Fort Wayne, Indiana - The United States Attorney's Office announced that a Grand Jury sitting in Fort Wayne, Indiana, returned the following Indictment on May 22, 2013:
Orlando Paschall, 22, and Devonte Travier, 19, both of Fort Wayne, Indiana, are charged in a two count Indictment with conspiracy to interfer with commerce by threat or violence and use, carry, brandish, and discharge a firearm during and in relation to a crime of violence both occurring on or about November 13, 2012. These charges were filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Fort Wayne Police Department, Allen County Police Department and the New Haven Police Department. This case has been assigned to and will be prosecuted by Assistant United States Attorney Tina L. Nommay.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.Federal Grand Jury in Fort Wayne Returns IndictmentRead the Press Release
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Fort Wayne, Indiana - The United States Attorney's Office announced that a Grand Jury sitting in Fort Wayne, Indiana, returned the following Indictment on November 20, 2013:
Jacob Miller, 50, of Auburn, Indiana, is charged in a five count Indictment with selling firearms to a known felon on or about March 28, 2013, April 15, 2013, June 14, 2013 and November 15, 2013, and dealing in firearms as an unlicensed dealer between on or about March
21, 2013, and continuing to on or about November 15, 2013. The Indictment also seeks the forfeiture of firearms and ammunition. These charges were filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case has been assigned to and will be prosecuted by Assistant United States Attorney Tina L. Nommay.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.Eight Individuals Charged in Illegal Gambling OperationRead the Press Release
Jackson, Miss – A federal grand jury returned an indictment against eight individuals from the Meridian, Mississippi area in connection with illegal gambling operations, announced U. S. Attorney Gregory K. Davis, Gabriel Grchan, Special Agent in Charge of IRS Criminal Investigation and Daniel McMullen, Special Agent in Charge of the Federal Bureau of Investigation.
The Indictment charges WILLIAM WAYNE (BILL) GORDON, SR., age 79, MILDRED GORDON, age 76, WILLIAM WAYNE (WAYNE) GORDON, JR., age 55, NELLIE MILLER, age 50, CAMERON GORDON, age 24, DENNIS MICHAEL GORDON, age 54, RICHARD McKISSACK, age 50, and CHRISTOPHER CRAWFORD, age 38, in Count 1 with Conspiracy to Commit a Federal Offense under 18 U.S.C. §371. Count 2 of the Indictment charges WILLIAM WAYNE (BILL) GORDON, SR., MILDRED GORDON, WILLIAM WAYNE (WAYNE) GORDON, JR., NELLIE MILLER, CAMERON GORDON, RICHARD McKISSACK, and CHRISTOPHER CRAWFORD with violation of the prohibition of operating illegal gambling business under 18 U.S.C. §1955. The maximum penalty for each offense is five years imprisonment and/or a fine of $250,000.00. The Defendants are scheduled to appear for arraignment before U.S. Magistrate Judge F. Keith Ball on Tuesday, November 26, 2013, at 10:00 a.m. at the U.S. Courthouse in Jackson, MS.
According to the Indictment, the charges are associated with the operation of illegal gambling businesses from November 2011 through at least May 14, 2013, at the following locations in Meridian, MS: The Snack Shack, located at 1479 Highway 11 & 80; The Sports Connection, which is commonly referred to as “the Log Cabin”, located at 501 46th Avenue; and The New Place, located at 401 23rd Avenue. It is alleged that at these locations the defendants would accept illegal wagers on the outcome of college and professional sporting events, then collect and remove the wagers from these locations and grade the bets based on the outcome of the wagered event to calculate winnings and losses for those persons placing the wagers. Thereafter, the defendants would pay persons with winning wagers and keep the remaining funds for their personal use and benefit. The Indictment in the case also alleges that the defendants would possess, own, control, display, operate, and expose for play illegal gambling and gaming devices, such as illegal video poker machines. It is alleged that the illegal gambling businesses were conducted in violation of Mississippi law and remained in substantially continuous operation for a period in excess of 30 days.
The Indictment also gives notice of the United States’ intent to seek criminal forfeiture of 8 pieces of real property in Meridian, MS, associated with the alleged criminal conduct, as well as approximately $125,905.15 in U.S. Currency seized from locations associated with the gambling operation.
The case is being prosecuted by Assistant U.S. Attorneys Carla J. Clark and J. Scott Gilbert. The investigation was conducted by the Internal Revenue Service-Criminal Investigations and the Federal Bureau of Investigation with assistance from the Mississippi Gaming Commission.
The public is reminded that an indictment is merely an accusation and all defendants are presumed innocent until proven guilty.###
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District Woman Indicted for First-Degree Murder While Armed in March 2013 Slaying of Her Husband-Shooting Took Place at Couple’s Apartment-Read the Press Release
WASHINGTON - Diana Lalchan, 28, of Washington, D.C., has been indicted on charges of first-degree murder while armed and possession of a firearm during a crime of violence for the slaying earlier this year of her husband, U.S. Attorney Ronald C. Machen Jr. announced today.
A grand jury returned the indictment on Nov. 21, 2013 in the Superior Court of the District of Columbia. Lalchan pled not guilty to the charges at her arraignment today. The Honorable Ronna L. Beck has set a trial date of March 3, 2014. If convicted, Lalchan faces a potential sentence of life in prison.
According to the government’s evidence, on March 28, 2013, at approximately 12:05 a.m., Lalchan called 911 and reported that she had just shot her husband inside their apartment in the 1200 block of Fourth Street SW. The Metropolitan Police Department (MPD) responded to the scene and found her inside the apartment, holding a cell phone. Police found her husband, Christopher Lalchan, 36, lying on the floor, unconscious and unresponsive. Mr. Lalchan was suffering from an apparent gunshot wound to the back of the head. The defendant was placed under arrest. A search of the residence revealed a semi-automatic handgun and three shell casings on the floor.
Lalchan had been married to Mr. Lalchan since October of 2008. After the shooting, Lalchan told police that her husband had asked her to come home on the evening of March 27, 2013, so that the two could have a meeting regarding their marriage. After having dinner, Lalchan said that an argument ensued that escalated and de-escalated for several hours. Ultimately, according to the government’s evidence, she fired three shots at Mr. Lalchan. According to the forensic evidence, the first shot was fired into the kitchen. The second shot was fired into the back of Mr. Lalchan’s head. A third shot was fired next to his head.
An indictment is merely a formal charge that a defendant has committed a violation of criminal law and is not evidence of guilt. Every defendant is presumed innocent until, and unless, proven guilty.
In announcing the indictment, U.S. Attorney Machen commended the work of the MPD detectives and officers who investigated the case. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Kelly Blakeney and Mia Beamon; Criminal Investigators Nelson Rhone, John Marsh, and Tommy Miller; Victim/Witness Advocates Tamara Ince and Marcia Rinker, and Assistant U.S. Attorney Cynthia Wright, who is prosecuting the matter.
13-403District Man Sentenced to Eight Years in Prison for Sexually Assaulting 8-Year-Old Girl-Victim Immediately Came Forward-Read the Press Release
WASHINGTON – A 38-year-old man from Washington, D.C., was sentenced today to eight years in prison on a charge that stemmed from his sexual abuse of an eight-year-old girl at whose home he was staying temporarily, U.S. Attorney Ronald C. Machen Jr. announced.
The defendant, who is not identified here to protect the privacy of the victim and her family, pled guilty in July 2013 in the Superior Court of the District of Columbia to one count of second-degree child sexual abuse. He was sentenced by the Honorable John Ramsey Johnson. In addition to the prison term, the defendant will be required to register as a sex offender for the rest of his life. He already was a convicted sex offender, having been previously convicted of the misdemeanor sexual assault of a 10-year-old girl in 2001.
According to the government’s evidence, the defendant was a trusted family friend, who frequently stayed overnight in the victim’s home in Southeast Washington. On June 20, 2013, while the girl’s mother was asleep in another room, he was alone with the victim, and used the opportunity to sexually assault her. The victim immediately ran to her mother and disclosed the abuse.
In announcing the sentence, U.S. Attorney Machen commended the work of the Metropolitan Police Department’s Youth Investigations Division. He also acknowledged the work of the Children’s Advocacy Center and the Children’s National Medical Center, which provided critical services to the victim. In addition, he praised the efforts of those who handled the case from the U.S. Attorney’s Office, including Child Forensic Interview Specialist Karen Giannakoulias and Victim/Witness Advocate Melissa Milam. Finally, he acknowledged the efforts of Assistant U.S. Attorney Heide L. Herrmann, who prosecuted the matter.
13-405District Man Sentenced to 6 ½ Years in Prison for Kidnapping and Sexual Assault-Defendant Sexually Assaulted Woman, Then Threw Her Down the Steps-Read the Press Release
WASHINGTON – Cornell “Man” Shumate, 30, of Washington, D.C., was sentenced today to 6 ½ years in prison on charges stemming from the kidnapping and sexual assault of a woman in March of 2012, U.S. Attorney Ronald C. Machen Jr. announced.
Shumate was found guilty in September 2013 by a jury in the Superior Court of the District of Columbia of charges of kidnapping, attempted sexual abuse, and assault. He was sentenced by the Honorable John Ramsey Johnson. Upon completion of his prison term, Shumate will be placed on five years of supervised release. He also will be required to register as a sex offender for the rest of his life.
According to the government’s evidence, in March 2012, the victim met Shumate’s friend and they exchanged phone numbers. A few days later, on March 25, 2012, the victim agreed to get together with Shumate’s friend. The friend brought the victim to Shumate’s house in Northeast Washington, and they, along with several others, drank and had casual conversation.
Unbeknownst to the victim, Shumate and his friend were using her as part of a game to see if they could get a woman to have sex with every man in the apartment. After a night of drinking and socializing, the victim had consensual sex with Shumate’s friend in the apartment. After she rejected the defendant, he pushed her into his bedroom, locked the door and started to rape her. After she was able to get away, he threw her out of the apartment and down two flights of stairs. The victim reported the assault immediately and Shumate was apprehended that night.
In announcing the sentence, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department’s Sexual Assault Unit. He also praised those who handled the case from the U.S. Attorney’s Office, including Victim/Witness Advocate Veronica Vaughan, Paralegal Specialist D’Yvonne Key, and Litigation Technology Specialist Kimberly Smith. Finally, he commended the efforts of Assistant U.S. Attorney Amy H. Zubrensky, who indicted the case, and Assistant U.S. Attorney Mervin A. Bourne, Jr., who prosecuted the case.
13-404District Man Sentenced to 24-Year Prison Term for Kidnapping Two Men and Assaulting A Police Officer-Armed Attacks Occurred Early Christmas Morning-Read the Press Release
WASHINGTON – Paul Smith, 33, of Washington, D.C., was sentenced today to a prison term of 24 years for kidnapping two men and assaulting a police officer last Christmas morning, all while armed, U.S. Attorney Ronald C. Machen Jr. announced.
Smith pled guilty in September 2013, in the Superior Court of the District of Columbia, to charges of kidnapping while armed, assaulting, resisting, or interfering with a police officer, and a firearms offense. He was sentenced by the Honorable William M. Jackson. Upon completion of his prison term, Smith will be placed on five years of supervised release.
According to the government’s evidence, on Dec. 25, 2012, at approximately 1 a.m., Smith approached three men who were traveling in a vehicle near the intersection of Martin Luther King Jr. Avenue and Sumner Road SE. He asked them for a ride home, and directed them to a building on Chesapeake Street SE.
Once at the building, Smith pulled out a firearm and ordered the men out of the vehicle. One ran away. Smith pointed a gun at the two others and demanded their money. The victims emptied their pockets, and one had an ATM card. Smith ordered the men back into the vehicle at gunpoint, and directed them to drive to a bank in the 4100 block of South Capitol Street SE.
Once they arrived at the bank, Smith ordered one of the men to go to the ATM, withdraw money, and give him the money. While this victim was at the ATM, Smith pointed the firearm at the second man, who remained in the vehicle. Once the victim returned from the ATM and handed Smith $300, an officer from the Metropolitan Police Department (MPD) pulled up. The two victims told the officer that Smith was robbing them.
The officer ordered Smith to drop his gun. Instead, Smith pointed his gun at the officer, and told the officer “No you drop your gun!” Smith then ran away, and the officer followed, ordering him to stop and drop his weapon. Smith refused to comply with the officer’s demands, and continued to run away towards Chesapeake Street SE. While on Chesapeake Street SE, Smith pointed the firearm at the officer. The officer discharged his firearm, striking Smith twice.
In announcing the sentence, U.S. Attorney Machen commended the work of the Metropolitan Police Department. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Lynette Briggs; Litigation Support Specialists William Henderson, Paul Howell, and Kimberly Smith, and Victim/Witness Advocate James Brennan. Finally, he expressed appreciation for the work of Assistant U.S. Attorneys Demian S. Ahn, who investigated the case, and Kendra Briggs, who investigated and prosecuted the matter.
13-406Demolition Company Operators Found Guilty in Manhattan Federal Court of Scheme to Underpay Employees in Violation of Federal Prevailing Wage LawRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JOVER NARANJO, the owner and president of Enviro & Demo Masters, Inc. (“Enviro”), and LUPERIO NARANJO, SR., a foreman for Enviro, were found guilty today in Manhattan federal court of perpetrating a scheme to underpay employees in violation of the federal prevailing wage law. The jury also found that JOVER NARANJO and LUPERIO NARANJO, SR., tampered with witnesses and used other people’s identities to further their fraudulent scheme. In addition, the jury found that JOVER NARANJO made false statements to a government agent in connection with the scheme. They were convicted after a two-week trial before U.S. District Judge Jed S. Rakoff.
Manhattan U.S. Attorney Preet Bharara said: “Today, Jover Navanjo, and Luperio Naranjo, Sr. stand convicted of deceiving government agencies through fraudulent payrolls that hid the unlawful underpayment of their employees, and then concealing their fraud. The Office has zero tolerance for contractors who unlawfully take advantage of their staff, abuse federal funds, and then lie about it to cover their tracks. With today’s verdict, Jover Naranjo and Luperio Naranjo, Sr., will be punished for their conduct.”
According to the Complaint and the Superseding Indictment filed in Manhattan federal court and the evidence presented at trial:
In August 2009, Enviro was awarded a sub-contract by the general contractor on a New York City project (the “Project”) to demolish five buildings in Manhattan (the “Contract”) that was funded in part with federal stimulus money. From August 2009 through February 2010, JOVER NARANJO and LUPERIO NARANJO, SR., participated in a scheme to submit fraudulent certified payrolls to the New York City Department of Housing Preservation and Development (“HPD”) and the U.S. Department of Labor in connection with the Contract. These certified payrolls were fraudulent in at least three respects. First, they listed relatives as the demolition workers on the Project, when in fact, these relatives did no work. Second, the certified payrolls did not list the actual individuals who worked on the Project. Third, the certified payrolls misrepresented the wages being paid to Enviro’s workers.
In this regard, the fraudulent certified payrolls indicated that Enviro was paying its employees the federal prevailing wage, as required by federal law, but in reality, they were being paid far less. Although the applicable federal prevailing wages for Enviro employees working on the Contract were approximately $49 and $33 per hour for demolition laborers, JOVER NARANJO and LUPERIO NARANJO, SR., paid their demolition workers as little as $13 per hour. The total amount of salary underpaid by the defendants to Enviro employees working on the Contract was in excess of approximately $650,000.
JOVER NARANJO and LUPERIO NARANJO, SR., also employed a number of measures to conceal their fraud. For example, they submitted supporting documentation with the certified payrolls that included time sheets on which they forged workers’ signatures, and canceled checks that they had doctored to make it appear that workers were earning the prevailing wage. In addition, they hid their workers from investigators and told some to lie about their identities, work schedules, and/or pay rates if they were questioned by investigators. When an employee truthfully told investigators that the employee was paid below the prevailing wage, JOVER NARANJO and LUPERIO NARANJO, SR., fired the employee and the employee’s relative.
JOVER NARANJO, 37, and LUPERIO NARANJO, SR., 65, both of Queens, New York, were each convicted of mail fraud, conspiracy to commit mail fraud, witness tampering, conspiracy to commit witness tampering, and aggravated identity theft. JOVER NARANJO was also convicted of one count of making false statements.
JOVER NARANJO faces a total maximum sentence of 87 years in prison, including a mandatory minimum sentence of two years. LUPERIO NARANJO, SR., faces a total maximum sentence of 82 years in prison, including a mandatory minimum sentence of two years. The defendants also each face a maximum fine of $250,000 or twice the gross gain or loss from the offense on each count except aggravated identity theft.
The defendants are scheduled to be sentenced by Judge Rakoff on March 24, 2014 at 4:00 p.m.
Mr. Bharara praised the outstanding investigative work of the New York Field Office of the U.S. Department of Labor’s Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, the New York City Department of Investigation, and the United States Environmental Protection Agency Criminal Investigation Division.
This case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Brian A. Jacobs and Brent S. Wible are in charge of the prosecution.
Crestline Man Charged with Child Pornography OffensesRead the Press Release
Miles E. Price, 29, of Crestline, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about June 3, 2013, through on or about September 2, 2013, Price knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct.
The indictment also charges that from on or about June 3, 2013, through on or about October 23, 2013, Price possessed a computer that contained child pornography.
The actual sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Canton office of the Federal Bureau of Investigation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.