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13 January 2014
PCP Dealer Sentenced to 10 Years in PrisonRead the Press Release
Greenbelt, Maryland – U.S. District Judge Roger W. Titus sentenced Richard Brown, age 28, of Lanham, Maryland, today to 10 years in prison followed by five years of supervised release for conspiracy to distribute and possess with intent to distribute phencyclidine (PCP).
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; and Chief Mark A. Magaw of the Prince George’s County Police Department.
According to Brown’s plea agreement, from December 2012 through January 2013, Brown conspired with others to distribute PCP. Specifically, on four occasions between December 5, 2012 and January 16, 2013, Brown distributed approximately 401 grams (over 14 ounces) of PCP to a cooperating witness, meeting the witness at the Suitland and Capitol Heights Metro stations to conduct the transactions. On January 31, 2013, the cooperating witness arranged to purchase 16 ounces of PCP from Brown. As Brown arrived at the meeting location, law enforcement agents approached the vehicle to arrest him. Brown was sitting in the front passenger seat of the vehicle holding a 32-ounce bottle that was half full of liquid. The agents saw Brown dump the contents of the bottle onto the passenger floorboard. Agents seized the bottle, which still contained three ounces of PCP, and soaked two rags with the remaining PCP that was spilled onto the floor and preserved the rags as evidence.Brown admits that he distributed between 700 grams and one kilogram of PCP during the time of the conspiracy.
United States Attorney Rod J. Rosenstein praised the DEA, ATF and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorneys Steven E. Swaney and Arun G. Rao, who prosecuted the case.Nine Individuals Sentenced for Federal Supervised Release ViolationsRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistWHEELING, WEST VIRGINIA - United States Attorney William J. Ihlenfeld, II, announced that during the month of December nine individuals had their supervised release revoked for violating terms and conditions imposed by the United States District Court.
CLARKSBURG DIVISION REVOCATIONS (Judge Irene M. Keeley)
DUPRE E. PHILLIPS, age 31, of Brooklyn, New York, was sentenced to 15 months in prison for failure to notify probation office of change in residence and failure to participate in treatment program. PHILLIPS was originally sentenced on June 16, 2006, to 122 months in prison and three years of supervised release for distribution of crack cocaine. In February of 2009, PHILLIPS’ sentence was reduced to 98 months in prison pursuant to the crack resentencing guidelines and in November of 2011, PHILLIPS’ sentence was again reduced to 64 months pursuant to the crack resentencing guidelines. PHILLIPS was remanded to the custody of the United States Marshal pending designation to a Federal institution.
ILLES WILLIAMS, age 34, of Morgantown, West Virginia, was sentenced to 12 months in prison for committing a new offense of Perjury. WILLIAMS was originally sentenced on January 22, 2009, to 78 months in prison and three years of supervised release for the distribution of crack cocaine. In February of 2009, WILLIAMS’ sentence was reduced to 63 months pursuant to the crack resentencing guidelines. WILLIAMS self-reported to the designated Federal institution on January 6, 2014.
THOMAS JEFFERSON DEEM, age 25, of Clarksburg, was sentenced to 10 months in prison for the unlawful use and possession of a controlled substance. DEEM was originally sentenced on November 9, 2012, to 6 months in prison and two years of supervised release for the distribution of hydrocodone within 1,000 feet of a protected location. DEEM was remanded to the custody of the United States Marshal pending designation to a Federal institution.
SHANNON ROSE AMSLER, age 27, of Stonewood, West Virginia, was sentenced to 6 months in prison for the use and possession of synthetic marijuana. AMSLER was originally sentenced on April 2, 2009, to 37 months in prison and six years of supervised release for the distribution of crack cocaine within 1,000 feet of a protected location. AMSLER was remanded to the custody of the United States Marshal pending designation to a Federal institution.
The United States was represented at the Clarksburg revocation hearings by Assistant U.S. Attorney Shawn A. Morgan.
ELKINS DIVISION REVOCATIONS (Chief Judge John Preston Bailey)
PATRICK MARTIN, age 35, of Glenville, West Virginia, was sentenced to 11 months in prison and 25 months of supervised release for committing the new offenses of trespassing, public intoxication and excessive use of alcohol. MARTIN was originally sentenced on September 8, 2008, to 18 months in prison and three years of supervised release for being a felon in possession of a firearm. On March 8, 2010, MARTIN’s supervised release was revoked due to his failure to register as a sex offender and he was sentenced to 11 months in prison and 25 months of supervised release. MARTIN was remanded to the custody of the United States Marshal pending designation to a Federal institution.
GREGORY STEPHEN SCOTT, age 33, of Beverly, West Virginia, was sentenced to 3 months in prison and 33 months of supervised release for possession and use of a controlled substance. SCOTT was originally sentenced on May 22, 2012, to 6 months in prison and three years of supervised release for conspiracy to distribute marijuana. SCOTT, who is free on bond, will self-report to the designated Federal institution on January 28, 2014.
The United States was represented at the Elkins revocation hearings by Assistant U.S. Attorneys Shawn A. Morgan and Stephen D. Warner.
WHEELING DIVISION REVOCATIONS (Judge Frederick P. Stamp, Jr.)
DENNIS SHAWN SCHUCH, age 44, of Reynoldsville, West Virginia, was sentenced to 14 months in prison for testing positive for the use of synthetic marijuana, failure to report for drug testing, failure to secure employment and committing another offense of driving on a suspended license. SCHUCH was originally sentenced on November 2, 2002, to 163 months in prison and five years of supervised release for the distribution of LSD within 1,000 feet of a school. On November 30, 2004, SCHUCH’s sentence was reduced to 120 months in prison. SCHUCH was remanded to the custody of the United States Marshal pending designation to a Federal institution.FRANCOIS ANTONIO BROWN, age 24, of Columbus, Ohio, was sentenced to 4 months imprisonment and 56 months of supervised release for testing positive for the use of controlled substances, failure to report for drug screens and failure to attend substance abuse counseling. BROWN was originally sentenced on August 11, 2008, to 70 months in prison and five years of supervised release for conspiracy to distribute more than 50 grams of crack cocaine. BROWN was released to supervised release on June 14, 2013, and these violations began within two months of his release. BROWN was remanded to the custody of the United States Marshal pending designation to a Federal institution.
The United States was represented at the Wheeling revocation hearings by Assistant U.S. Attorney John C. Parr.
MARTINSBURG DIVISION REVOCATIONS (Judge Gina M. Groh)WALTER JOHNSON, age 51, of Washington, DC, was sentenced to 48 months of supervised release with the first six months to be served under home detention for committing the offense of operating a vehicle while impaired. JOHNSON was originally sentenced on January 29, 2008, to 70 months in prison and 4 years of supervised release for the distribution of crack cocaine. In November of 2011, JOHNSON’s sentence was reduced to 60 months pursuant to the crack resentencing guidelines.
The United States was represented at the Martinsburg revocation hearing by Assistant U.S. Attorney Paul T. Camilletti.
The United States Probation Office carries out probation and pretrial services functions throughout the Northern District of West Virginia. With locations in Wheeling, Clarksburg, Martinsburg, and Elkins, the office works to assist the federal courts in the fair administration of justice, to protect the community, and to bring about long-term positive change in individuals under supervision. Jeff Givens is the Chief Probation Officer for the Northern District.
Nigerian Man Sentenced for Bank/Mail Fraud Scheme and ID TheftRead the Press Release
HOUSTON - Olasunkanmi Shittu, 42, has been sentenced to a total of 84 months in federal prison for his role in a bank fraud and mail fraud scheme that defrauded approximately 25 victims, announced United States Attorney Kenneth Magidson. Shittu pleaded guilty Oct. 15, 2013, to one count each of conspiracy to commit bank and mail fraud, four counts of mail fraud and rwo counts of aggravated identity theft.
Today, U.S. District Judge David Hittner handed him a sentence of 18 months for each of the conspiracy to commit mail fraud and mail fraud charges. Those sentences will be served concurrently to each other but consecutive to another 18 months for the conspiracy to commit bank fraud. He was further ordered to serve 24 months on each of the two identity theft charges which will both be served consecutively to each other and to the other sentences imposed for a total term of 84 months in federal prison. He will also pay restitution payment in the amount of $10,550. Not a U.S. citizen, he is expected to face deportation proceedings back to Nigeria following completion of his prison term.
Shittu stole personal identifying information and credit card account information from multiple victims. He and his co-conspirators would then hack into the victim’s credit card accounts via the Internet, steal reward points associated with the account, convert those points into cash and transfer the cash onto debit cards or gift cards under their sole custody and control. Using this scheme, on or about June 11, 2012, Shittu caused four Wal-Mart re-loadable MoneyCards valued at approximately $10,550 to be sent to him and his co-conspirators via the U.S. Mail. The four Wal-Mart cards were funded with reward points stolen from at least 25 different victims.
Shittu will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The case was investigated by the United States Postal Inspection Service and was prosecuted by Assistant United States Attorney Julie Searle.
Mobile Man Sentenced for Filing Fraudulent GCCF ClaimsRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that on January 10, 2014, Bradley Tolbert was sentenced to 5 years of Probation by Chief Judge William H. Steele on his conviction of filing a false claim with GCCF. The defendant was ordered to pay full restitution.
The indictment alleged that the defendant filed a claim for and received payment asserting that he lost wages from work he performed at the Alabama State Docks due to the Deepwater Horizon oil spill. In fact, the defendant did not experience any loss of wages due to the oil spill.
The case was investigated by the FBI. The case is being prosecuted by AUSA Vicki Davis.
Mobile Man Sentenced for Bank RobberyRead the Press Release
MOBILE, Ala. - United States Attorney Kenyen R. Brown announced that on January 10, 2014, Jacob L. Anderson, was sentenced by District Judge Kristi K. DuBose to serve 42 months in prison on one count of Bank Robbery after Anderson’s plea of guilty. The indictment alleged that on or about July 12, 2013, Anderson robbed the Tillman’s Corner Branch of Wells Fargo Bank of approximately $2,054.00 in United States currency.
The case was investigated by MPD and the FBI. The case was prosecuted by AUSA Vicki Davis.
Mobile County Man Sentenced to Seven Years Imprisonment for Using A Weapon in Furtherance of A Bank RobberyRead the Press Release
MOBILE, AL-- United States Attorney Kenyen R. Brown announces that Henry Earl Young was sentenced to seven years imprisonment on Friday by United States District Court Judge Kristi D. DuBose, for use of a weapon in furtherance of a crime of violence (bank robbery) in violation of Title 18 USC '924(c). Young committed an armed robbery of $2,731 from Trustmark Bank located at 1025 Highway 43, Saraland, Alabama on April 24, 2013. Young was ordered to serve five years of supervised release with the United States Probation Office after he completes his term of imprisonment at the Federal Bureau of Prisons. Young was also ordered to pay $2,506 in restitution to the bank. Law enforcement recovered the other $225.00 from Young at the time of his arrest. Young was also ordered to pay a $100 special assessment which goes into a fund for victims of crime.
United States Attorney Brown stated that the case was jointly investigated by the Federal Bureau of Investigation, and the City of Saraland Police Department. Brown highly commended the joint efforts of the two investigative agencies in investigating and prosecuting this case. Brown added that his office would continue to aggressively prosecute bank robbers and individuals who use weapons in furtherance of a crime of violence, thus endangering the community.
Man Sentenced to 25 Years in Kansas City, Kan., Carjacking CaseRead the Press Release
KANSAS CITY, KAN. - A Kansas City, Kan., man was sentenced Monday to 25 years in federal prison on charges arising from an armed robbery and carjacking, U.S. Attorney Barry Grissom said.
Derrick L. Freeman, 28, Kansas City, Kan., pleaded guilty to one count of armed robbery, one count of carjacking, and one count of unlawful possession of a firearm after a felony conviction.
In his plea, Freeman admitted that on May 12, 2013, he and his co-defendants went to the home of a Kansas City, Kan., man to buy some synthetic marijuana. Once there, they robbed the man at gunpoint. During the robbery, Freeman fired a handgun and then fled the scene before police arrived.
On May 26, 2013, Freeman and co-defendants walked to a Stop Shop gas station at 6865 State Avenue in Kansas City, Kan., where Freeman suggested they “get a car.” They robbed the driver of a 2004 Ford Freestar minivan of wallet and keys and drove away in the victim’s minivan. When the defendants realized officers had spotted their vehicle they led police on a 17-minute chase at speeds up to 112 miles per hour. The minivan wrecked in a plowed field near Leavenworth Road and North 184th Street in Basehor, Kan., where the defendants fled on foot. Derrick Freeman fired a handgun at a law enforcement officer before being arrested.
Co-defendants include: Anthony L. Irvin, 19, Kansas City, Kan., who was sentenced to 207 months.
Terry D. Tillman, 26, Kansas City, Kan., who was sentenced to 10 years.
Joe Freeman, 33, Kansas City, Kan., who is awaiting trial.
Jeffrey B. Jackson, 47, Leavenworth, Kan., who is awaiting trial.Grissom commended the Kansas City, Kan., Police Department, the Wyandotte County Sheriff’s Department, the Kansas Highway Patrol, the Basehor Police Department, the Edwardsville Police Department, the Bonner Springs Police Department, the Leavenworth County Sheriff’s Department and Special Assistant U.S. Attorneys Erin Tomasic and Trent Krug for their work on the case.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.Lewiston Man Sentenced to over Six Years for Illegal Possession of a FirearmRead the Press Release
Contact: Darcie N. McElwee
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced today
Brunel Constant, a/k/a “Jamal”, 34, of Lewiston, Maine was sentenced in U.S. District Court by Judge Nancy Torresen on Friday to 74 months in prison and three years of supervised release for possession of a firearm by a convicted felon. Constant was convicted of the charge on May
21, 2013, following a two day jury trial.According to trial testimony, in August 2011, Constant, a convicted felon, was found sleeping on the porch of an apartment building to which he had no connection. When residents there approached him, an argument ensued and Constant threatened to return with a firearm.
Moments later, Constant returned to the apartment building and fired two bullets into one of the apartments.The investigation leading to the conviction was conducted by the Lewiston Police
Department, the Central Maine Violent Crime Task Force and the Bureau of Alcohol, Tobacco, Firearms and Explosives.Kings County Woman Sentenced to Prison for Stealing Disability Benefits from Department of Veterans AffairsRead the Press Release
FRESNO, Calif. – Nola Diane Collins, 60, of Armona, was sentenced today by U.S. District Judge Lawrence J. O’Neill to five months in prison for stealing disability compensation benefits paid by the U.S. Department of Veterans Affairs, United States Attorney Benjamin B. Wagner announced. Collins also was ordered to pay $76,998 in restitution to the VA.
According to court documents, Collins’s husband received benefits paid by the U.S. Department of Veterans Affairs (VA) until his death in December 2007. For two years after his death, Collins unlawfully received and spent the VA benefits totaling approximately $76,998. Collins never notified the VA that her husband was deceased. On several occasions, Collins forged her husband’s signature to the benefit checks and passed them at a convenience store, telling the store clerk that her husband was disabled and unable to cash the check himself.
This case was the product of an investigation by the U.S. Department of Veterans Affairs, Office of Inspector General. Assistant U.S. Attorney Christopher Baker prosecuted the case.
Justice Department Alleges “Buy Here, Pay Here” Used-Car Dealerships Engaged in Illegal Lending DiscriminationRead the Press Release
The U.S. Department of Justice, the U.S. Attorney’s Office for the Western District of North Carolina and the North Carolina Department of Justice filed a lawsuit today alleging that defendants Auto Fare Inc., Southeastern Auto Corp. and Zuhdi A. Saadeh—the owners and operators of two “buy here, pay here” used-car dealerships in Charlotte, N.C. —violated the federal Equal Credit Opportunity Act by intentionally targeting African-American customers for the extension and servicing of installment sale contracts on unfair and predatory terms. The State of North Carolina also alleges that the defendants’ actions violated the state’s Unfair and Deceptive Trade Practices Act.
The complaint, which was filed today in the U.S. District Court for the Western District of North Carolina, alleges that the defendants engaged in a pattern or practice of “reverse redlining” by targeting African-American customers for installment sale contracts with inflated sales prices, down payments, and interest rates without meaningfully assessing the customers’ credit. The complaint states that Saadeh, who operates Auto Fare and United Car Sales, has used racial slurs to refer to African-Americans and made statements expressing his views that African-American customers have fewer credit options, making them more likely to accept the predatory terms of the contracts offered by the defendants.
The defendants’ practices resulted in rates of default and repossession that are higher than other subprime used-car dealers. The complaint also alleges that the defendants failed to provide customers with a reasonable notice of repossession, repossessed vehicles of customers who were not in default on their contracts, failed to give customers refunds they were due, improperly seized customers’ personal property in repossessed vehicles and used global positioning system devices to locate and repossess vehicles without informing customers that the dealership had installed these devices.
The U.S. Department of Justice, the U.S. Attorney’s Office for the Western District of North Carolina and the North Carolina Department of Justice investigated and filed the lawsuit jointly.
“Intentionally targeting African-Americans for contracts with predatory terms because of their race violates fair lending laws,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “By filing this lawsuit, the Justice Department is acting to ensure that subprime dealers in the auto industry provide credit in accordance with the law. The Justice Department will continue to ensure that people have equal access to credit, regardless of race.”
“The terms of a person’s loan should not be determined by their race,” said U.S. Attorney Anne M. Tompkins for the Western District of North Carolina. “Predatory lending and illegal discrimination will simply not be tolerated.”
“Charging people inflated prices based on their race isn’t the way to do business in our state,” said North Carolina Attorney General Roy Cooper. “These allegations show outrageous behavior that should be stopped.”
The Civil Rights Division and other agencies involved in this matter are part of the Financial Fraud Enforcement Task Force, established by President Obama to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
African-American customers who entered into installment sale contracts for the purchase of automobiles at Auto Fare or United Car Sales since 2006, former employees of the dealerships and any other individuals with information relevant to this lawsuit are encouraged to contact the U.S. Department of Justice at 1-800-896-7743, mailbox 92, or at [email protected].
A copy of the complaint, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department website at www.justice.gov/fairhousing . Fighting illegal lending discrimination is a top priority of the Justice Department. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt .
Jury Convicts Connecticut Man, Georgia Woman of False Tax ClaimsRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a New Fairfield, Conn., man and a Chickamauga, Ga., woman were convicted in federal court today of making false claims for tax refunds.
Nkosi Gray, 40, of New Fairfield, Conn., and Kimberly Johnson, 43, of Chickamauga, Ga., were each found guilty of one count of filing false claims for a tax refund.
Gray and Johnson each filed fraudulent tax returns that falsely claimed refunds due to over-withholding of taxes. Gray received a $278,874 refund and Johnson filed a claim for a $61,959 refund on behalf of another person identified in the federal indictment as “M.L.F.” These claims utilized fictitious 1099-OID tax forms (which are legitimately used to pay taxes on income received from the interest on bond investments). In actuality, they had not received interest income from the banks and lenders listed on their Forms 1099, nor had any money been over-withheld.
Co-defendant Gerald A. Poynter, also known as “Brother Jerry Love,” 48, of Kansas City, Mo., pleaded guilty on Nov. 7, 2013, to being the leader of a conspiracy to defraud the government that utilized this fraudulent practice. Conspirators claimed that a total of $96 million dollars in fraudulent tax refunds were due. The IRS mistakenly paid out $3.5 million on these fraudulent claims.
Gray, who received a refund of $278,874 on Oct. 17, 2008, paid a $15,000 fee to Poynter a few days later. After the refund was deposited into his account, Gray made 56 withdrawals over the next two months. By withdrawing the cash in increments of less than $10,000, Gray (a former bank employee) avoided the requirement for his bank to report those transactions to the government.
Johnson filed a refund claim for $61,959 in April 2009 on behalf of “M.L.F.” and that refund was issued.
Following the presentation of evidence, the jury in the U.S. District Court in Kansas City, Mo., deliberated for about six hours over two days before returning the guilty verdicts, ending a trial that began Monday, Jan. 6, 2014.
Under federal statutes, Gray and Johnson are each subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000. Separate sentencing hearings are scheduled for May 15, 2014.
Poynter is among 11 defendants who have pleaded guilty, including Kristi Jones, 41, of Riverside, Mo.; Shirley Oyer, 72, of Overland Park, Kan.; Jennifer Wilson, 36, of Cumming, Ga.; Mark J. Murray, 51, of Newton, Ala.; John V. Perdido, 57, of Temecula, Calif.; Earl Lee Davis, 55, of Monroe, La.; Robert E. Morris, 68, of Rocklin, Calif.; and Karen A. Olson, 42, of Wood Dale, Ill. Marian Fine-Kennedy, 36, of Eugene, Ore., and Maria Haro Campos, 42, of Vista, Calif., have each pleaded guilty in separate but related cases.
1099-OID Tax Fraud Scheme
Conspirators utilized 1099-Original Issue Discount forms as part of their scheme.
These forms are legitimately used by tax filers who must pay taxes on income they receive from the interest on their bond investments. Tax on certain bonds must be paid as income accrues. Bond holders receive annual forms, called 1099-Original Issue Discount (OID), from the debt issuers.
However, the scheme described in the indictments utilized the 1099-OID forms in a nonsensical manner. Clients of the conspirators assembled financial documents such as mortgage and loan statements, car payments, foreclosure records, bank statements, credit card statements, and other records of debt and spending. Poynter and his staff used this debt information – rather than any actual bond income – to prepare and/or finalize false tax returns and improperly calculated Forms 1099-OID.
These tax returns falsely claimed that the filers had received interest and dividend income and that federal income tax had been withheld. The fraudulent returns claimed the government had over-withheld taxes from the clients’ purported interest and dividend income, making the clients appear entitled to more than $96 million in tax refunds.
In reality, Poynter’s clients had not earned – or paid tax on – such income. No financial institution had issued any 1099-OID forms. Instead, the income that was listed was calculated by what the indictment describes as an “arbitrary and capricious formula.” Conspirators simply added up the taxpayers’ debts and spending and listed those creditors as “payers” of interest and dividends.
OID Fraud Web Site
A Web site has been established to provide information about the status of this investigation. Updates about this investigation and related cases will be posted at www.justice.gov/usao/mow/divisions/OIDfraud.html
This case is being prosecuted by Assistant U.S. Attorney Daniel M. Nelson. It was investigated by IRS-Criminal Investigation and the Treasury Inspector General for Tax Administration (TIGTA).
Irene Man Sentenced in Methamphetamine Distribution ConspiracyRead the Press Release
United States Attorney Brendan V. Johnson announced that an Irene, South Dakota, man convicted of Conspiracy to Distribute a Controlled Substance was sentenced on January 9, 2014, by U.S. District Judge Karen E. Schreier.
Jacob Franklin Zurcher, age 30, was sentenced to 46 months in custody, to be followed by 3 years of supervised release.
Zurcher was indicted by a federal grand jury on July 9, 2013, for Conspiracy to Distribute 500 Grams of Methamphetamine. He pled guilty on October 29, 2013.
As his part in the conspiracy, Zurcher allowed co-conspirators to sell methamphetamine from his home and also purchased methamphetamine and sold it to customers in Sioux Falls.
This case was investigated by the Sioux Falls Police Department, the Nebraska State Patrol, and the U.S. Drug Enforcement Administration. Assistant U.S. Attorney John E. Haak prosecuted the case.
Zurcher was immediately turned over to the custody of the U.S. Marshals Service.
Huntington Felon Pleads Guilty to Illegal Firearm Possession ChargeRead the Press Release
HUNTINGTON, W.Va. – A Huntington felon faces up to 10 years in prison after pleading guilty to a federal firearm possession charge, U.S. Attorney Booth Goodwin announced today. Jerry T. Kinney, 29, pleaded guilty to possession of a firearm by a prohibited person. On September 5, 2013, Kinney illegally possessed a .45 caliber pistol near Huntington.
Kinney was previously convicted of possession of a controlled substance in November 2002 in the Third Judicial Circuit Court in Detroit, Michigan. Kinney also was previously convicted of possession of a firearm by a prohibited person in October 2010 in the Circuit Court of Cabell County, West Virginia. He did not have his rights to possess a firearm restored.
Kinney is scheduled to be sentenced on April 14, 2014 by Chief United States District Judge Robert C. Chambers.
The investigation was conducted by the Huntington Violent Crimes and Drug Task Force. Assistant United States Attorney Gregory McVey is in charge of the prosecution.
The case is being brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
Honolulu Women Arraigned on Indictment for Fraudulent Debt Elimination SchemeRead the Press Release
HONOLULU – After a five-day trial in the United States Court in Honolulu, a federal jury found Matthew Zmuda, 29, of Kauai, guilty on Friday, January 10, of conspiring to distribute and possess with intent to distribute, 50 grams or more of methamphetamine from January to April 2012, as well as attempting to possess 50 grams or more of methamphetamine with the intent to distribute. The jury also found him guilty of conspiring to distribute and possess with intent to distribute a detectable amount of heroin.
Florence T. Nakakuni, United States Attorney for the District of Hawaii, said that according to the evidence presented at trial Zmuda agreed with other individuals to have methamphetamine and heroin sent from California, through a delivery service, to Kauai in February, March, and April 2012. Zmuda was the intended recipient of 447 grams of methamphetamine seized by law enforcement at the Honolulu International Airport on April 3, 2012, and was addressed to a hotel in Kauai. He had also arranged to meet at that hotel to receive the methamphetamine and the heroin from the provider.
Zmuda faces up to life in prison with a mandatory minimum 20 year term of imprisonment when he is sentenced by Senior U.S. District Judge Helen Gillmor on May 12, 2014.
The investigation which resulted in the charges in the case was conducted by the Drug Enforcement Administration and Hawaii Airport Task Force, assisted by the efforts of the Kauai Police Department. Assistant U.S. Attorney Tony R. Roberts handled the prosecution.
Grundy County Man Sentenced to 10 Years in Prison for Possessing A Firearm in October 2012 Shoot-Out with PoliceRead the Press Release
CHATTANOOGA, Tenn. -- Russell Wayne Smith, 46, of Gruetli-Laager, Tenn., was sentenced on Jan. 13, 2014, to serve 10 years in prison by the Honorable Harry S. Mattice, Jr., U.S. District Judge. Smith pleaded guilty in October 2013 to a federal grand jury indictment charging him with being a prohibited person, by virtue of a felony conviction, in possession of a firearm. Smith’s sentence was the maximum allowed by the statute.
The investigation began when Smith, who had escaped from the Grundy County Jail, was found by Grundy County Sheriff’s Office deputies and fled from the scene, first on an all-terrain vehicle and then on foot. Deputies pursued Smith through a heavily wooded area and spotted him pointing a rifle in their direction. The deputies fired upon Smith hitting him at least twice. When he was apprehended he had two loaded firearms in his possession. Smith had previously been convicted of several felony offenses.
The indictment and subsequent conviction of Smith was the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Tennessee Bureau of Investigation and Grundy County Sheriff’s Office. Assistant U.S. Attorney Terra Bay represented the United States.
This case was brought as part of Project Safe Neighborhoods (PSN), a comprehensive national strategy that creates local partnerships with law enforcement agencies to effectively enforce existing gun laws. It provides more options to prosecutors, allowing them to utilize local, state, and federal laws to ensure that criminals who commit gun crime face tough sentences. PSN gives each federal district the flexibility it needs to focus on individual challenges that a specific community faces.
Government Intervenes in Lawsuits Against Health Management <br /> Associates Inc. Hospital Chain Alleging Unnecessary <br /> Inpatient Admissions and Payment of KickbacksRead the Press Release
The government has intervened in eight False Claims Act lawsuits against Health Management Associates Inc. (HMA) alleging that HMA billed federal health care programs for medically unnecessary inpatient admissions from the emergency departments at HMA hospitals and paid remuneration to physicians in exchange for patient referrals, the Justice Department announced today. The government also has joined in the allegations in one of these lawsuits that Gary Newsome, HMA’s former CEO, directed HMA’s corporate practice of pressuring emergency department physicians and hospital administrators to raise inpatient admission rates, regardless of medical necessity. HMA operates 71 hospitals in 15 states: Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Washington and West Virginia.
“The Department of Justice is committed to ensuring that health care providers who attempt to misuse federal health care programs for their own profit are held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “Schemes such as this one can contribute significantly to the rising cost of delivering health care and create needless patient risk.”
The lawsuits allege that HMA’s corporate officers, at the direction of Newsome, exerted significant pressure on doctors in the emergency department to admit patients who could have been placed in observation, treated as outpatients or discharged, and that this resulted in the submission of inflated or false claims to federal health care programs. One lawsuit also alleges that patients were improperly admitted for scheduled surgical procedures that should have been done on an outpatient basis. The complaints further allege that HMA paid kickbacks, either in the form of bonuses or awarded contracts, to physician groups staffing HMA emergency rooms to induce the physicians to admit patients unnecessarily.
In addition, the lawsuits allege that HMA paid kickbacks to other physician groups to induce referrals. For example, HMA allegedly provided improper remuneration, both through the provision of free office space and staffing and through direct payments, to Primary Care Associates, a physician practice group in Port Charlotte, Fla., in exchange for referrals to two HMA hospitals in Florida. HMA also allegedly paid kickbacks to physicians in Lancaster, Pa., by paying inflated prices for physician-owned assets, providing sham medical directorship contracts and selling assets to physicians for below fair market value.
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs. The Stark Statute prohibits a hospital from submitting claims for patient referrals made by a physician with whom the hospital has an improper financial arrangement. Both the Anti-Kickback Statute and Stark Statute are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.
“This intervention decision marks the culmination of a lengthy and comprehensive investigation into a variety of serious fraud allegations against one of our district’s largest health care providers,” said Acting U.S. Attorney for the Middle District of Florida A. Lee Bentley III. “We hope that this case will serve as a reminder to our provider community that this office is fully engaged in the struggle against misconduct of this kind.”
“Improper hospital admissions cost the government millions of dollars in unnecessary fees and subject patients to excessive treatment and needless risk, driving up the cost of health care,” said U.S. Attorney for the Western District of North Carolina Anne M. Tompkins. “The government will pursue aggressively providers that boost their profits at the expense of Medicare and other government programs.”“Unlawful financial relationships between hospitals and physicians solely to increase referrals are, unfortunately, a common practice that corrupts the health care system,” said U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer. “The system also suffers a direct financial hit when hospitals fraudulently increase admissions where they are not indicated, solely to benefit hospitals’ bottom line. We will not relent in our efforts to combat these kinds of fraudulent schemes and recover funds for the Medicare program.”
“HMA’s submission of claims to Medicare, Medicaid and TRICARE for unnecessary inpatient stays is a serious matter that threatens the integrity of our entire health care system, and the end result is that those who need health care cannot afford it,” said U.S. Attorney for the Middle District of Georgia Michael J. Moore. “The Middle District of Georgia is committed to fighting health care fraud.”
“Investigations such as these are a very high priority for the FBI because of the potential impact to the nation’s health care system and to the public,” said FBI Assistant Director Ron Hosko. “Because of the priority nature of these cases as well as their complexity, we have created a centralized team to provide nationwide support to our field offices called the Major Provider Response Team. The FBI is committed to working with our partners in these types of investigations and appreciates the public’s involvement in the process.”
The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they believe that defendants submitted false claims for government funds and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done in these cases. The eight lawsuits are pending in the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Eastern District of Pennsylvania and District of South Carolina .
The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.
These matters were investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division; the U.S. Attorney’s Offices for the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Middle and Eastern Districts of Pennsylvania and District of South Carolina; the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation.
The cases are captioned United States ex rel. Brummer v. Health Mgmt. Assocs. Inc. , et al.,3-09-cv-135 (CDL)(M.D. Ga.); United States ex rel. Williams v. Health Mgmt. Assocs. Inc. et al., 3:12-cv-151 (M.D. Ga.) United States ex rel. Plantz v. Health Mgmt. Assocs. Inc., et al., 13C-1212 (N.D. Ill.) United States ex rel. Miller v. Health Mgmt. Assocs. Inc., et al., 10-3007 (E.D. Pa.) United States ex rel. Mason v. Health Mgmt. Assocs. Inc., et al., 3:10-CV-472-GCM (W.D.N.C.) United States ex rel. Nurkin v. Health Mgmt. Assocs. Inc., et al., 2:11-cv-14-FtM-29DNF (M.D. Fla.) United States ex rel. Jacqueline Meyer & Cowling v. Health Mgmt. Assocs. Inc., et al.; 0:11-cv-01713-JFA (D.S.C.) and United States ex rel. Paul Meyer v. Health Mgmt. Assocs. Inc., et al.,11-62445 cv-Williams (S.D. Fla.).
The claims asserted against HMA and Newsome are allegations only, and there has been no determination of liability.Government Intervenes in Lawsuits Against Health Management Associates Inc. Hospital Chain Alleging Unnecessary Inpatient Admissions and Payment of KickbacksRead the Press Release
WASHINGTON - The government has intervened in eight False Claims Act lawsuits against Health Management Associates Inc. (HMA) alleging that HMA billed federal health care programs for medically unnecessary inpatient admissions from the emergency departments at HMA hospitals and paid remuneration to physicians in exchange for patient referrals, the Justice Department announced today. The government also has joined in the allegations in one of these lawsuits that Gary Newsome, HMA’s former CEO, directed HMA’s corporate practice of pressuring emergency department physicians and hospital administrators to raise inpatient admission rates, regardless of medical necessity. HMA operates 71 hospitals in 15 states: Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Washington and West Virginia.
“The Department of Justice is committed to ensuring that health care providers who attempt to misuse federal health care programs for their own profit are held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “Schemes such as this one can contribute significantly to the rising cost of delivering health care and create needless patient risk.”
The lawsuits allege that HMA’s corporate officers, at the direction of Newsome, exerted significant pressure on doctors in the emergency department to admit patients who could have been placed in observation, treated as outpatients or discharged, and that this resulted in the submission of inflated or false claims to federal health care programs. One lawsuit also alleges that patients were improperly admitted for scheduled surgical procedures that should have been done on an outpatient basis. The complaints further allege that HMA paid kickbacks, either in the form of bonuses or awarded contracts, to physician groups staffing HMA emergency rooms to induce the physicians to admit patients unnecessarily.
In addition, the lawsuits allege that HMA paid kickbacks to other physician groups to induce referrals. For example, HMA allegedly provided improper remuneration, both through the provision of free office space and staffing and through direct payments, to Primary Care Associates, a physician practice group in Port Charlotte, Fla., in exchange for referrals to two HMA hospitals in Florida. HMA also allegedly paid kickbacks to physicians in Lancaster, Pa., by paying inflated prices for physician-owned assets, providing sham medical directorship contracts and selling assets to physicians for below fair market value.
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs. The Stark Statute prohibits a hospital from submitting claims for patient referrals made by a physician with whom the hospital has an improper financial arrangement. Both the Anti-Kickback Statute and Stark Statute are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.
“This intervention decision marks the culmination of a lengthy and comprehensive investigation into a variety of serious fraud allegations against one of our district’s largest health care providers,” said Acting U.S. Attorney for the Middle District of Florida A. Lee Bentley III. “We hope that this case will serve as a reminder to our provider community that this office is fully engaged in the struggle against misconduct of this kind.”
“Improper hospital admissions cost the government millions of dollars in unnecessary fees and subject patients to excessive treatment and needless risk, driving up the cost of health care,” said U.S. Attorney for the Western District of North Carolina Anne M. Tompkins. “The government will pursue aggressively providers that boost their profits at the expense of Medicare and other government programs.”
“Unlawful financial relationships between hospitals and physicians solely to increase referrals are, unfortunately, a common practice that corrupts the health care system,” said U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer. “The system also suffers a direct financial hit when hospitals fraudulently increase admissions where they are not indicated, solely to benefit hospitals’ bottom line. We will not relent in our efforts to combat these kinds of fraudulent schemes and recover funds for the Medicare program.”
“HMA’s submission of claims to Medicare, Medicaid and TRICARE for unnecessary inpatient stays is a serious matter that threatens the integrity of our entire health care system, and the end result is that those who need health care cannot afford it,” said U.S. Attorney for the Middle District of Georgia Michael J. Moore. “The Middle District of Georgia is committed to fighting health care fraud.”
“Investigations such as these are a very high priority for the FBI because of the potential impact to the nation’s health care system and to the public,” said FBI Assistant Director Ron Hosko. “Because of the priority nature of these cases as well as their complexity, we have created a centralized team to provide nationwide support to our field offices called the Major Provider Response Team. The FBI is committed to working with our partners in these types of investigations and appreciates the public’s involvement in the process.”
The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they believe that defendants submitted false claims for government funds and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done in these cases. The eight lawsuits are pending in the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Eastern District of Pennsylvania and District of South Carolina.
The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.
These matters were investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division; the U.S. Attorney’s Offices for the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Middle and Eastern Districts of Pennsylvania and District of South Carolina; the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation.
The cases are captioned United States ex rel. Brummer v. Health Mgmt. Assocs. Inc., et al.,3-09-cv-135 (CDL)(M.D. Ga.); United States ex rel. Williams v. Health Mgmt. Assocs. Inc. et al., 3:12-cv-151(M.D. Ga.); United States ex rel. Plantz v. Health Mgmt. Assocs. Inc., et al., 13C-1212(N.D. Ill.); United States ex rel. Miller v. Health Mgmt. Assocs. Inc., et al., 10-3007 (E.D. Pa.); United States ex rel. Mason v. Health Mgmt. Assocs. Inc., et al., 3:10-CV-472-GCM (W.D.N.C.); United States ex rel. Nurkin v. Health Mgmt. Assocs. Inc., et al., 2:11-cv-14-FtM-29DNF (M.D. Fla.); United States ex rel. Jacqueline Meyer & Cowling v. Health Mgmt. Assocs. Inc., et al.; 0:11-cv-01713-JFA (D.S.C.) and United States ex rel. Paul Meyer v. Health Mgmt. Assocs. Inc., et al.,11-62445 cv-Williams (S.D. Fla.).
The claims asserted against HMA and Newsome are allegations only, and there has been no determination of liability.
Government Intervenes in Lawsuits Against Health Management Associates Inc. Hospital Chain Alleging Unnecessary Inpatient Admissions and Payment of KickbacksRead the Press Release
The government has intervened in eight False Claims Act lawsuits against Health Management Associates Inc. (HMA) alleging that HMA billed federal health care programs for medically unnecessary inpatient admissions from the emergency departments at HMA hospitals and paid remuneration to physicians in exchange for patient referrals, the Justice Department announced today. The government also has joined in the allegations in one of these lawsuits that Gary Newsome, HMA’s former CEO, directed HMA’s corporate practice of pressuring emergency department physicians and hospital administrators to raise inpatient admission rates, regardless of medical necessity. HMA operates 71 hospitals in 15 states: Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Washington and West Virginia.
“Unlawful financial relationships between hospitals and physicians solely to increase referrals are, unfortunately, a common practice that corrupts the health care system,” said U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer. “The system also suffers a direct financial hit when hospitals fraudulently increase admissions where they are not indicated, solely to benefit hospitals’ bottom line. We will not relent in our efforts to combat these kinds of fraudulent schemes and recover funds for the Medicare program.”
“The Department of Justice is committed to ensuring that health care providers who attempt to misuse federal health care programs for their own profit are held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “Schemes such as this one can contribute significantly to the rising cost of delivering health care and create needless patient risk.”
The lawsuits allege that HMA’s corporate officers, at the direction of Newsome, exerted significant pressure on doctors in the emergency department to admit patients who could have been placed in observation, treated as outpatients or discharged, and that this resulted in the submission of inflated or false claims to federal health care programs. One lawsuit also alleges that patients were improperly admitted for scheduled surgical procedures that should have been done on an outpatient basis. The complaints further allege that HMA paid kickbacks, either in the form of bonuses or awarded contracts, to physician groups staffing HMA emergency rooms to induce the physicians to admit patients unnecessarily.
In addition, the lawsuits allege that HMA paid kickbacks to other physician groups to induce referrals. For example, HMA allegedly provided improper remuneration, both through the provision of free office space and staffing and through direct payments, to Primary Care Associates, a physician practice group in Port Charlotte, Fla., in exchange for referrals to two HMA hospitals in Florida. HMA also allegedly paid kickbacks to physicians in Lancaster, Pa., by paying inflated prices for physician-owned assets, providing sham medical directorship contracts and selling assets to physicians for below fair market value.
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs. The Stark Statute prohibits a hospital from submitting claims for patient referrals made by a physician with whom the hospital has an improper financial arrangement. Both the Anti-Kickback Statute and Stark Statute are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient.
“This intervention decision marks the culmination of a lengthy and comprehensive investigation into a variety of serious fraud allegations against one of our district’s largest health care providers,” said Acting U.S. Attorney for the Middle District of Florida A. Lee Bentley III. “We hope that this case will serve as a reminder to our provider community that this office is fully engaged in the struggle against misconduct of this kind.”
“Improper hospital admissions cost the government millions of dollars in unnecessary fees and subject patients to excessive treatment and needless risk, driving up the cost of health care,” said U.S. Attorney for the Western District of North Carolina Anne M. Tompkins. “The government will pursue aggressively providers that boost their profits at the expense of Medicare and other government programs.”
“HMA’s submission of claims to Medicare, Medicaid and TRICARE for unnecessary inpatient stays is a serious matter that threatens the integrity of our entire health care system, and the end result is that those who need health care cannot afford it,” said U.S. Attorney for the Middle District of Georgia Michael J. Moore. “The Middle District of Georgia is committed to fighting health care fraud.”
“Investigations such as these are a very high priority for the FBI because of the potential impact to the nation’s health care system and to the public,” said FBI Assistant Director Ron Hosko. “Because of the priority nature of these cases as well as their complexity, we have created a centralized team to provide nationwide support to our field offices called the Major Provider Response Team. The FBI is committed to working with our partners in these types of investigations and appreciates the public’s involvement in the process.”
The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they believe that defendants submitted false claims for government funds and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done in these cases. The eight lawsuits are pending in the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Eastern District of Pennsylvania and District of South Carolina.
The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.
These matters were investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division; the U.S. Attorney’s Offices for the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Middle and Eastern Districts of Pennsylvania and District of South Carolina; the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation.
The cases are captioned United States ex rel. Paul Meyer v. Health Mgmt. Assocs. Inc., et al.,11-62445 cv-Williams (S.D. Fla.); United States ex rel. Brummer v. Health Mgmt. Assocs. Inc., et al.,3-09-cv-135 (CDL)(M.D. Ga.); United States ex rel. Williams v. Health Mgmt. Assocs. Inc. et al., 3:12-cv-151 (M.D. Ga.); United States ex rel. Plantz v. Health Mgmt. Assocs. Inc., et al., 13C-1212 (N.D. Ill.); United States ex rel. Miller v. Health Mgmt. Assocs. Inc., et al., 10-3007 (E.D. Pa.); United States ex rel. Mason v. Health Mgmt. Assocs. Inc., et al., 3:10-CV-472-GCM (W.D.N.C.); United States ex rel. Nurkin v. Health Mgmt. Assocs. Inc., et al., 2:11-cv-14-FtM-29DNF (M.D. Fla.); United States ex rel. Jacqueline Meyer & Cowling v. Health Mgmt. Assocs. Inc., et al.; 0:11-cv-01713-JFA (D.S.C.).
The claims asserted against HMA and Newsome are allegations only, and there has been no determination of liability.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Gang Member Sentenced in Dodge City Racketeering CaseRead the Press Release
WICHITA, KAN. – A Dodge City gang member was sentenced Monday to 10 years for conspiring to attempt to kill a rival gang member, U.S. Attorney Barry Grissom said.
Jesus Sanchez, 23, Dodge City, Kan., pleaded guilty to one count of conspiracy to commit acts of racketeering.
In his plea, Sanchez admitted he was a member of the Diablos Viejos and affiliated with the Norteno street gang on March 30, 2011, when he attempted to shoot and kill George Gonzalez, a member of the rival Sureno gang. Sanchez and other Norteno gang members encountered Gonzalez at the east Love’s convenience store in Dodge City. They exchanged gang signs and slurs with the victim before driving away from the store. Later, they returned and pursued Gonzalez. Near 1602 6th Avenue, Gonzalez got out of the car in which he was riding and ran up the alley toward his girlfriend’s house. As Gonzalez ran, Sanchez fired at least two shots at him from a .40 caliber handgun. The shots struck a fence.
Sanchez also admitted that on July 2, 2008, in Dodge City he and another gang member robbed a victim named Bryant Licon at knifepoint.
Sanchez admitted that Nortenos engaged in violence including assaults and robberies as a means of advancing their positions in the organization and building the gang’s reputation.
Sanchez is one of 22 Norteno gang members who have been convicted on charges contained in a federal indictment filed May 2012. It was only the second time a federal RICO Act indictment (Racketeer Influenced and Corrupt Organizations Act) has been filed in Kansas.
Grissom commended the Dodge City Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Ford County Sheriff’s Office, the Kansas Bureau of Investigation, the Ford County Attorney’s Office, Assistant U.S. Attorney Lanny Welch and Assistant U.S. Attorney Aaron Smith for their work on the case.
Fort Yates Man Sentenced for Assault with a Dangerous WeaponRead the Press Release
BISMARCK – U.S. Attorney Timothy Q. Purdon announced that on Jan. 13, 2014, Morris Flying Horse, 42, Fort Yates, N.D., was sentenced by U.S. District Judge Daniel L. Hovland on a charge of assault with a dangerous weapon. Flying Horse pleaded guilty to the charge on Oct. 4, 2013.
Judge Hovland sentenced Flying Horse to serve one year and six months in federal prison, to be followed by three years of supervised release. Flying Horse was ordered to pay restitution of $395.65 and to pay a $100 special assessment to the Crime Victim’s Fund.
On Jan. 16, 2013, Flying Horse assaulted another man by punching him in the face. When the victim fell to the floor, Flying Horse, who was wearing work boots, kicked the victim several times in the face.
The case was investigated by the Bureau of Indian Affairs – Standing Rock Agency.
Assistant U.S. Attorney Gary Delorme prosecuted the case.
Former Yurok Tribe Forestry Director Sentenced to 37 Months for EmbezzlementRead the Press Release
SAN FRANCISCO – Roland Leroy Raymond was sentenced today to three years in prison, and ordered to pay $852,000 in restitution for embezzling approximately $850,000 from the Yurok Indian Tribe of Northern California, announced United States Attorney Melinda Haag, Federal Bureau of Investigation Special Agent in Charge David J. Johnson, and Department of Interior Office of Inspector General, Western Investigations Office, Special Agent in Charge Jack Rohmer.
Raymond, the Tribe’s former Forestry Director, pleaded guilty on May 22, 2013, to having carried out a scheme to embezzle approximately $850,000 in funds the United States Department of Interior’s Bureau of Indian Affairs had authorized for specific environmental uses under the Endangered Species Act. In his plea agreement, Raymond admitted conspiring with at least one person at Mad River Biologists (“MRB”), a local biological consulting firm based in Eureka, to steal the money. (MRB’s owner and founder has been charged separately in a case that remains pending. CR 13-683 WHA)
According to the plea agreement, from approximately 2007 through the end of 2010, Raymond abused his position of trust within the Tribe by procuring false invoices from MRB for environmental work MRB never performed. MRB submitted the invoices to the Tribe and Raymond approved them for payment. MRB funneled most of the money it received as a result of the fraudulent invoices back to Raymond, who spent the cash on gambling and drugs.
Raymond, 51, of Eureka, California, was charged by an Information filed on January 11, 2013. The Information alleged a single count of Conspiracy to Commit Embezzlement and Theft from an Indian Tribal Organization, in violation of Title 18, United States Code, Sections 371 and 1163.
Today’s sentencing followed two prior sentencing hearings. In the first, held on November 19, 2013, the court heard victim-impact statements from five members of the Yurok Tribal Council, including the Chairman and Executive Director. On December 23, 2013, the court took testimony to address allegations that Raymond had attempted to mislead the court regarding his treatment at the Santa Rita Jail facility.
The sentence was handed down by The Honorable William Alsup, United States District Court Judge, following Raymond’s guilty plea to the charge contained in the Information. Judge Alsup also sentenced the defendant to a three-year period of supervised release following his release from custody, as well as ordering him to pay restitution in the amount of $852,000. The defendant, who was already in federal custody, will begin serving his sentence immediately.
The prosecution is the result of an investigation begun by the Del Norte County District Attorney and continued by the Department of Interior Office of Inspector General and the Federal Bureau of Investigation. Following the sentencing, U.S. Attorney Haag expressed her appreciation for the excellent work done by the Del Norte County District Attorney’s Office, the FBI, and the DOI OIG. Special Assistant United States Attorney Casey O’Neill and Assistant United States Attorney David Callaway prosecuted the case with the assistance of legal assistants Elise Etter and Rawaty Yim.
Former U.S. Soldier Who Sought to Join Terrorist Group Convicted and Sentenced to 7 Years in PrisonRead the Press Release
Defendant Destroyed Computer Evidence Before Leaving the U.S. to Join the Foreign Terrorist Organization al-Shabaab in Somalia
Baltimore, Maryland – U. S. District Judge J. Frederick Motz sentenced Craig Benedict Baxam, age 26, of Laurel, Maryland, to serve seven years in prison followed by five years of supervised release after Baxam pleaded guilty today to destroying records that might be used in a terrorism investigation.
The guilty plea and sentence were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; John P. Carlin, Acting Assistant Attorney General for National Security; and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
“Craig Baxam traveled to Africa in order to join the terrorist organization Al-Shabaab,” said U.S. Attorney Rod J. Rosenstein. “Mr. Baxam was arrested in Kenya before he reached Somalia.”
“The investigation of Mr. Baxam was a collaborative effort with our law enforcement partners both within the United States and overseas,” said Special Agent in Charge Stephen E. Vogt. “The combined efforts of the Joint Terrorism Task Force and other agencies, including the Federal Air Marshal Service, U.S. Customs and Border Protection and the Maryland Transportation Authority Police, resulted in a successful prosecution which highlights the FBI’s highest investigative priority, the prevention of terrorist acts.”
According to his plea agreement, on December 23, 2011, Baxam was arrested in Kenya by members of the Kenyan Anti-Terrorism Police Unit, as he traveled north to southern Somalia to join al-Shabaab, a foreign terrorist organization. On December 27 and 30, 2011, FBI agents interviewed Baxam while he was in custody in Kenya. Baxam told the agents that because of his prior service in the U.S. Army, and specifically his training and experience in military intelligence, he knew of the U.S. government’s capabilities in tracing internet protocol addresses and other investigative techniques. Consequently, before leaving the U.S., he destroyed his personal home computer and threw the remains in a dumpster. He told the agents that he did not want any record left behind, and that he wanted to maintain a low profile. He also said that he purchased a round trip plane ticket to Kenya rather than a one way ticket even though he had no intention of returning to the U.S., in order not to arouse the suspicion of the FBI and U.S. military.
Baxam and the government agreed that if the Court accepted the plea agreement Baxam should be sentenced to seven years in prison followed by five years of supervised release. U.S. District Judge J. Frederick Motz agreed and imposed that sentence immediately following his acceptance of Baxam’s guilty plea.
United States Attorney Rod J. Rosenstein praised the FBI=s Maryland and New York Joint Terrorism Task Forces for their work in the investigation and recognized the Department of Justice Counterterrorism Section and U.S. Attorney=s Office for the Southern District of New York for their assistance in the investigation. Mr. Rosenstein also commended the Federal Air Marshal Service, U.S. Customs and Border Protection and the Maryland Transportation Authority Police for their assistance in the investigation.
Mr. Rosenstein thanked Assistant United States Attorney Harvey E. Eisenberg, who prosecuted the case with assistance from Trial Attorney Robert J. Sander of the Counterterrorism Section of the Department of Justice.
Former San Ysidro School District Superintendent Sentenced for Extorting Political Contributions from Prospective Contractor by Threatening to Withhold WorkRead the Press Release
SAN DIEGO – Former San Ysidro School District Superintendent Manuel Paul was sentenced today to two months in custody, a $5,000 fine, one year of supervised release and 120 hours of community service for threatening to withhold the awarding of contracts unless he received political contributions.
U.S. Magistrate Judge William V. Gallo said he imposed a sentence that included jail time because Paul failed the children of his district. Judge Gallo stated, “Thousands of children relied on you for sound judgment.” He later added, “Abuse of trust is a mortal sin that is difficult to excuse.”
Paul was ordered to report to the federal Metropolitan Correctional Center downtown on January 27.
Paul worked in the San Ysidro School District (“SYSD”) for 38 years as a teacher, principal, and superintendent, a post he held from 2007 until his resignation in 2013. According to court documents, he served several duties as superintendent, including recommending contractors for consideration and approval by the SYSD Governing Board for SYSD construction projects.
In entering his plea, Paul admitted requesting that a contractor (“Contractor A”) make $3,600 in campaign contributions to three political candidates for the 2010 Board election, identified in charging documents as Candidates A, B, and C. Paul admitted that he made clear that Contractor A’s inclusion on the list of potential contractors for future District building projects was contingent on Contractor A making the payment.
According to the plea agreement, shortly thereafter – and only two months before the 2010 Board election – Paul accepted $2,500 in cash from Contractor A in the parking lot of a Chula Vista restaurant. Paul admitted that he then contributed a portion of the $2,500 to the political campaigns of Candidates A, B, and C by purchasing campaign signs from a print shop in Tijuana.
According to court documents, Candidates A, B, and C won the three open seats.
In addition to his guilty plea, Paul has also entered into a stipulation with California’s Fair Political Practices Commission, in which he admitted to receiving a gift in excess of the annual gift limit by accepting the $2,500 from Contractor A. As part of his settlement with the FPPC, Paul has agreed to pay a $5,000 fine.
United States Attorney Laura E. Duffy stressed that her office will continue to pursue vigorously any criminal activity that seeks to introduce illegal money into campaigns. “Today’s sentence is a stark reminder that illegal money in our elections – regardless of the amount – is a threat to the very fabric of our democratic form of government and will be treated as such by our office. All citizens of our district have the right to elections free from corruption.”
FBI Special Agent in Charge, Eric S. Birnbaum, commented, “The obligation to deal honestly and truthfully is the responsibility of all who serve the public. Today's sentencing holds Mr. Paul accountable for his actions." The FBI encourages the public to report allegations of public corruption to the FBI public corruption hotline at telephone number (877) NO - BRIBE (662-7423).
DEFENDANTS Case Number: 14CR2351-WVG Manuel Paul Age: 63 Bonita, CA CHARGESDeprivation of Benefit for Political Contribution – Title 18, U.S.C., Section 601
INVESTIGATING AGENCIES
Maximum penalty: 1 year imprisonment and $100,000 fineFederal Bureau of Investigation
Former NFL Player Sentenced for Drug and Gun ChargesRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Robert Cedrick Baker, III, age 37, of Gainesville, Florida, was sentenced to serve 75 months in prison for possession with intent to distribute heroin and possession of a firearm in furtherance of a drug trafficking crime. The sentence was handed down by the Honorable Hugh Lawson, United States District Court Judge, in Valdosta, Georgia.Mr. Baker, a former player in the National Football League, pled guilty to the charges on October 1, 2013. In his plea agreement, he admitted that he was stopped by the Lowndes County Sheriff’s Office on the evening of January 20, 2013 on Georgia Highway 401 for a traffic violation. A consensual search of his car revealed that Mr. Baker was in possession of 59.5 grams of heroin and a Smith & Wesson, 9mm semi-automatic pistol. As part of his plea of guilty, Mr. Baker admitted that he possessed the heroin for distribution, and he was carrying the 9mm semi-automatic pistol in furtherance of his drug trafficking crime.
“Mr. Baker made a terrible mistake when he chose to traffic illegal drugs, and particularly when he brought a gun along to help him do so,” said U.S. Attorney Michael Moore. “He will have a long time to reflect on that mistake in federal prison.”
The case was investigated by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Lowndes County Sheriff’s Office. Assistant United States Attorney Peter Leary is handling the prosecution for the Government.
For additional information please contact Pamela Lightsey, Public Information Officer, United States Attorney’s Office at (478) 621-2603.
Former Lee County Commissioner "Tammy" Hall Sentenced for Stealing from Her Campaign FundRead the Press Release
Fort Myers, Florida U.S. District Judge Sheri Polster Chappell today sentenced former Lee County Commissioner Tammara Ann Hall (53, Cape Coral) to six months in federal prison on her conviction for wire fraud. She was also ordered to serve a 3-year term of supervised release, following her release from prison. Special conditions of supervision include a 90-day term of home confinement, and 250 hours of community service. The court also ordered a money judgment in the amount of $33,756, and for Hall to pay restitution in the same amount. Hall was ordered to report to the Federal Bureau of Prisons on or before February 14, 2014. A separate restitution hearing will be held on March 14, 2014.
Hall pleaded guilty to the charge on October 3, 2013.
According to court documents, Hall was a Lee County Commissioner running for re-election in the November 2010 General Election. From November 2009 to November 2010, Hall diverted and embezzled approximately $33,756 that was contributed by donors, to the Tammy Hall campaign fund. Hall used the money for personal expenditures unrelated to the campaign. She completed Florida Department of State campaign fund quarterly reports and failed to disclose that she had diverted campaign contributions to pay for personal expenses. Hall falsely represented the nature of the expenditures, or omitted certain donor campaign contribution checks from the quarterly reports. Hall stole from her campaign fund by electronically transferring funds from the campaign bank account, into to her personal bank account at Wachovia Bank, by writing checks from the campaign bank account and depositing the checks into her personal bank account, and by depositing certain campaign contribution checks from donors directly into her personal bank account.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Jeffrey F. Michelland.
Former Insurance Agent SentencedFor Stealing Customers' PremiumsRead the Press Release
TOPEKA, KAN. A former Marshall County insurance agent was sentenced Monday to 21 months in federal prison for stealing customers' premiums, U.S. Attorney Barry Grissom said. In addition, she was ordered to pay $160,000 in restitution.
Monica Smart, 49, Frankfort, Kan., pleaded guilty to one count of mail fraud. In her plea, she admitted the crime occurred from January 2009 to Aug. 27, 2010, while she worked for United Insurance, a small insurance company located in Marysville, Kan.
Smart changed United customers’ mailing addresses so that the customers would not receive policy statements and notices. She also changed United customers' premium payment schedules from annual and semi-annual payments to monthly payments. She continued to collect the full annual and semi-annual payments from the customers and deposited those payments into a bank account she controlled. Then she paid only the amounts due for a monthly payment. She used the difference to pay her personal expenses, much like an interest-free loan.
When Smart’s scheme unraveled, policy holders were made whole, but the owners of the insurance company were not.
Grissom commended the Marysville Police Department, the FBI and Assistant U.S. Attorney Christine Kenney for their work on the case.
Florida Corrections Officer and Wife Sentenced for Tax Fraud and ObstructionRead the Press Release
Orlando, Florida – U.S. District Judge Charlene Edwards Honeywell last month sentenced Kenneth Pointon (52) and Margaret Pointon (55), both of Orlando, to federal prison for making a false refund claim to the Internal Revenue Service (IRS) in the amount of $509,420. Kenneth Pointon, who was sentenced to 30 months in federal prison, was also sentenced for obstructing the due administration of the Internal Revenue laws. Margaret Pointon was sentenced to 13 months in federal prison. Both were also ordered to serve a 3-year term of supervised release, following their release from prison, and to pay $485,355 in restitution. Kenneth Pointon was a corrections officer at the Central Florida Reception Center at the time of the offense, which occurred in 2009.
Kenneth Pointon and Margaret Pointon were found guilty by a jury on October 3, 2013, following a three-day trial.
According to court documents and evidence presented at trial, in 2008, Kenneth and Margaret Pointon participated in a scheme in which taxpayers report exaggerated amounts of taxable income and withholdings on their Forms 1040 and other documents, causing the IRS to issue improper refunds.
The Pointons followed this scheme by falsely reporting $827,646 in taxable interest, and $788,094 in inflated tax withholdings, on their 2008 Form 1040. In reality, the Pointons did not earn any taxable interest in 2008 and only earned $65,342 in taxable income.
In response to their fraudulent tax forms, the IRS issued a refund check in the amount of $509,420 to the Pointons. In May 2009, the Pointons received the check and deposited it into a newly-created bank account in Dunedin, Florida. Within a span of five months, they made numerous transfers between bank accounts. The IRS Collection Division was able to recover only $24,060 of the refund received by the Pointons, resulting in a loss of $485,355 to taxpayers.
During the time period in which the IRS Collection Division was attempting to recover the refund, Kenneth Pointon sent several frivolous and obstructive documents to the IRS, in order to settle his tax liability and avoid liens and levies.
This case was investigated by Internal Revenue Service - Criminal Investigation. It was prosecuted by Assistant United States Attorney E. Jackson Boggs Jr.
Federal Grand Jury IndcitmentsRead the Press Release
Contact Person: Beth Drake (803) 929-3000
Columbia, South Carolina ---- United States Attorney Bill Nettles stated today that a Federal Grand Jury in Greenville, South Carolina, returned Indictment(s) against the following: Anderson County Resident Indicted for Possession of Child Pornograph
David D. Survilas, age 46, of Walhalla, South Carolina, was charged in a 1-count Indictment with possession of child pornography. The maximum penalty Survilas could receive is not more than twenty (20) years imprisonment and a fine of $250,000.00. This case was investigated by U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) special agents and is assigned to Assistant United States Attorney William J. Watkins, Jr., of the Greenville office for prosecution.
Foreign Nationals Charged with Illegal Re-entry
Jorge Hernandez-Morales, Nestor Perez-Antonio, Gerson David Ordonez-Irias, Ramon Alvarez-Ornelas, and Francisco Martinez-Sebastian were each charged in Indictments with illegal re-entry to the United States, a violation of Title 8, United States Code, Section 1326. The maximum penalty each could receive, depending on their prior criminal history, is two to twenty years imprisonment. These cases were investigated by U.S. Immigration and Customs Enforcement (ICE) agents and are assigned to Assistant United States Attorney Max Cauthen of the Greenville office for prosecution.
Individual Indicted for Failure to Register as a Sex Offender
Paul Edward Philson, Jr., was charged in a 1-count Indictment with failure to register as a sex offender, a violation of Title 18, United States Code, Section 2250. The maximum penalty Philson could receive is ten years imprisonment. The case was investigated by agents of the United States Marshals Service and is assigned to Assistant United States Attorney Max Cauthen of the Greenville office for prosecution.
The United States Attorney stated that all charges in these Indictments are merely accusations and that all defendants are presumed innocent until and unless proven guilty.Eighth Circuit Court of Appeals Upholds Conviction of Former Rapid City SurgeonRead the Press Release
United States Attorney Brendan V. Johnson announced that the United States Court of Appeals for the Eighth Circuit has affirmed the convictions of Edward J.S. Picardi, age 56, a former Rapid City surgeon. Picardi is currently serving a five-year prison sentence for tax evasion.In October 2012, Picardi was convicted by a jury of 13 separate federal felony counts, including five counts of tax evasion for years 1999 through 2003; five counts of making false statements on each of his tax returns for years 2004 through 2008; and three counts of failing to file required reports with the United States Treasury Department in 2007 through 2009 disclosing his interest in foreign accounts.
He was sentenced on May 7, 2013, and received the statutory maximum sentence of 60 months in custody for Counts 1-5 of tax evasion; 36 months for Counts 6-10 of making false statements; and 60 months for Counts 11-13 of failing to file required reports. The sentences were ordered to run concurrently.
Picardi appealed his convictions, asking that all 13 counts be reversed and that his case be remanded for a new jury trial. On Friday, January 10, 2014, the Eighth Circuit Court of Appeals issued a published opinion rejecting each of Picardi’s appellate arguments and affirming all of his convictions.
U.S. Attorney Johnson lauded the decision. “We are very pleased with the appellate decision. The Eighth Circuit Court of Appeals opinion closes the book on this case. It affirms the reasoned verdict of Dr. Picardi’s jury, which found him guilty on all thirteen tax and related financial felonies. The lesson should be very clear. No matter how elaborate your strategy and no matter what you do for a living, if you evade paying your fair share of taxes, you’ll land in federal prison,” said Johnson.
Picardi was convicted after a jury heard evidence that he sent his earnings from his surgical practice through a complicated offshore network. His earnings passed through a web of entities organized under the laws of Ireland, Hungary, Cyprus, Isle of Man, Jersey, and Guernsey. The money was ultimately deposited into various foreign accounts that Picardi controlled through a New Zealand trust, in the name of a corporation set up for him in Nevis, a Caribbean island. Through these offshore transactions, Picardi attempted to hide his income and evade over $1 million in taxes.
“The unanimous Appellate Court decision to uphold Mr. Picardi’s tax fraud convictions is highly gratifying, as it demonstrates that using complicated schemes to defraud the government will not only be discovered and prosecuted, but convictions will stand,” said Karyn Fonseca, Assistant Special Agent in Charge of the IRS Criminal Investigation office responsible for investigating Edward Picardi. Fonseca added, “I would like to recognize and applaud the tireless efforts of both the Assistant United States Attorney and the IRS Special Agent who worked diligently to ensure that Mr. Picardi was brought to justice and his convictions validated.”
The case was investigated by the Criminal Investigation Division of the Internal Revenue Service. Assistant U.S. Attorney Kevin Koliner and Department of Justice Tax Division Trial Attorney Joseph Giannullo prosecuted the case.
Picardi remains in federal custody and will continue to serve his sentence.
Disc Jockey in Puerto Rico Pleads Guilty <br /> to Sexual Exploitation of Three MinorsRead the Press Release
A former disc jockey for area high school parties pleaded guilty today in the District of Puerto Rico to producing child pornography.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico, and Special Agent in Charge Angel M. Melendez of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in San Juan made the announcement.
Eduardo Santiago-Rivera, 45, pleaded guilty before U.S. Magistrate Judge V élez-Riv é in the District of Puerto Rico to nine counts of sexual exploitation of children and one count of possession of child pornography. Santiago-Rivera was charged by superseding indictment on May 13, 2013.
Santiago-Rivera was a disc jockey who met his victims at area high school parties and on various social networking sites. Santiago-Rivera admitted that in June and July 2012, he induced, persuaded, enticed, coerced and used at least three minors, who ranged in age from 12 to 15, to engage in sexually explicit conduct for the purpose of creating video images. Santiago-Rivera used an Internet-based video chat program, “ooVoo,” to direct and coerce the minors to undress and to engage in various acts of sexually explicit conduct, including masturbation and the lascivious exhibition of their genitals. Santiago-Rivera also recorded himself engaging in sexual acts with one of the minors.
Santiago-Rivera has been in federal custody since he was arrested on July 27, 2012. Sentencing will be scheduled at a later date.
This case was investigated by ICE HSI. The case is being prosecuted by Trial Attorneys Mark Angehr of the Criminal Division’s Public Integrity Section and Amy E. Larson of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Marshal Morgan of the District of Puerto Rico.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.Detroit Man Sentenced to 5 Years in Federal Prison for Selling HeroinRead the Press Release
HUNTINGTON, W.Va. – A Detroit man was sentenced to five years in federal prison today in connection with a heroin distribution scheme, announced U.S. Attorney Booth Goodwin. Durrell Desean Lucas, also known as “D,” of Huntington, previously pleaded guilty in September 2013 to conspiracy to distribute 100 grams or more of heroin. Lucas’ sentence was handed down by Chief United States District Court Judge Robert C. Chambers in Huntington.
Between January 2013 and July 1, 2013, Lucas, 40, participated in a heroin distribution scheme in and around the Huntington area. Lucas told police that he and several associates made trips from Detroit to Huntington to sell heroin. During the scheme, Lucas also made phone calls to an undercover DEA agent to arrange two separate heroin transactions on June 30 and July 1, 2013. The two heroin transactions took place in Huntington.
DEA agents obtained a search warrant for an apartment located in the Prichard Building in Huntington. Mr. Lucas, who was inside of the apartment at the time the search warrant was executed, told police that he threw approximately 12 grams of heroin out the window. Officers were able to find the heroin.
Mr. Lucas told police that he was responsible for selling a total of approximately 150 to 250 grams of heroin in and around Huntington.The Drug Enforcement Administration and the Huntington Police Department conducted the investigation. Assistant United States Attorney Gregory McVey handled prosecution.
Defendant Sentenced on Federal Marijuana ChargesRead the Press Release
United States Attorney Kenyen Brown announces that Paul Williams was sentenced Friday in Federal Court after pleading guilty to Possession with Intent to Distribute Marihuana. Williams received a sentence of 24 months imprisonment.
Homeland Security Investigations conducted the investigation with the assistance of the Mobile County Sheriff=s Office and presented the case for prosecution to the United States Attorney=s Office. Assistant United States Attorney Daryl Atchison handled the prosecution of the case on behalf of the United States.
Cresco Man Sentenced to More Than Seven Years in Prison for Possession of Homemade BombRead the Press Release
A man who possessed a homemade bomb was sentenced today to more than seven years in federal prison.
Bjorn Luster, age 34, from Cresco, Iowa, received the prison term after a September 19, 2013, guilty plea to one count of possession of an unregistered firearm, a destructive device.
The evidence in the case showed that during the execution of a search warrant at Luster’s residence in January 2013, law enforcement officers found a destructive device, specifically, a homemade bomb and a container of explosive powder. Luster admitted that he made the bomb and that he wrapped it with shrapnel (BBs and nails) to make it more destructive.
Luster was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Luster was sentenced to 87 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Luster is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted as part of Project Safe Neighborhoods, a cooperative local, state and federal program aimed at the enhanced prosecution of gun crimes. The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and was investigated by the Cresco, Iowa, Police Department, the Iowa Division of Narcotics Enforcement, and the Bureau of Alcohol, Tobacco, and Firearms.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-CR-2021.
Court Rejects Banking Associations’ Challenge to Regulations Addressing Offshore Tax AvoidanceRead the Press Release
Today the District Court in the District of Columbia dismissed a challenge filed by the Florida Bankers Association and Texas Bankers Association challenging 2012 amendments to the Department of the Treasury’s interest-reporting regulations. The regulations require U.S. banks to report to the Internal Revenue Service (IRS) information about accounts earning more than $10 of interest beginning in 2013 that are held by nonresident aliens of all countries with which the United States has a tax treaty or other information exchange agreement. These new reporting requirements help the United States’ ability to comply with requests from its treaty and exchange partners and implement the Foreign Account Tax Compliance Act.
“This ruling advances the Department of Justice’s and Internal Revenue Service’s continuing efforts to pursue taxpayers trying to evade taxes through offshore accounts,” said Assistant Attorney General Kathryn Keneally of the Tax Division. “The court’s opinion today represents an important step in our commitment to work with our treaty partners to eliminate cross-border tax evasion.”
The court upheld the regulations’ 2012 amendments, finding that the IRS “reasonably concluded that the regulations will improve U.S. tax compliance, deter foreign and domestic tax evasion, impose a minimal reporting burden on banks, and not cause any rational actor – other than a tax evader – to withdraw his funds from U.S. accounts.”
The court’s decision affirms the IRS’ ongoing efforts to close the tax gap through cooperative measures with foreign governments, including the 2012 amendments.
Related Materials:
Florida Bankers Association, et al. v. United States Department of Treasury, et al.
Memorandum Opinion
Concord Twp. Man Charged for Defrauding Credit Union Out of $2.5 MillionRead the Press Release
A Concord Township man was charged in federal court for defrauding Cleveland-based Taupa Lithuanian Credit Union out of $2.5 million, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office.
John Struna, 51, was charged in a criminal information with one count of conspiracy to commit theft or embezzlement from a credit union.
“This defendant is part of a group that took advantage of the trust of hundreds of people for their own personal gain,” Dettelbach said. “These criminal charges should serve as a reminder that there is no such thing as free money.”
“John Struna willfully overdrew his credit union accounts to the tune of $2.5 million through his relationship with a corrupt executive at the credit union,” Anthony said. “The FBI will continue efforts to make sure all the individuals responsible for the collapse of the Taupa Lithuanian Credit Union are held accountable.”
The National Credit Union Administration and the Ohio Department of Commerce took possession of Taupa last July and placed it into receivership due to its insolvency. Taupa had about 1,150 members and assets of approximately $24 million, according to court records.
Credit union CEO Alex Spirikaitis and former teller Michael Ruksenas have previously been charged for their roles in conspiracies related to defrauding the credit union.
Struna maintained both personal and corporate accounts at Taupa dating back to 1995. He began a conspiracy with Spirikaitis (not charged herein) in 2007, during which time Struna overdrew his accounts by approximately $2.5 million, according to the information.
Struna called Spirikaitis about twice a month and requested Spirikaitis’ approval to withdraw additional funds. Spirikaitis made multiple transfers from Taupa’s internal accounts to cover the overdrafts, according to the information.
Spirikaitis caused Taupa to make approximately 38 false and fraudulent wire transfers into Struna’s personal accounts between 2007 and 2013. During that time, Struna repaid only approximately $15,000, according to the information.
In 2011, Struna requested and received $112,105 from Spirikaitis for the purchase of a condominium located in Ft. Myers, Florida. In 2012, he requested and received approximately $100,000 for an investment opportunity. At no time did Struna submit any credit applications or loan documents, according to the information.
As a result of the conspiracy, Taupa and the NCUA suffered a loss of approximately $2.5 million, according to the information.
This case is being prosecuted by Special Assistant United States Attorney Derek Kleinmann and Assistant United States Attorney Robert J. Patton. The case was investigated by the Federal Bureau of Investigation.
If convicted, the defendant’s sentence will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An 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.
Columbus Man Who Had Heroin and Oxycodone Enters Federal Guilty PleaRead the Press Release
HUNTINGTON, W.Va. – A Columbus man who had heroin and oxycodone during an August 2013 traffic stop pleaded guilty today to a federal drug charge, announced U.S. Attorney Booth Goodwin. Antoine Walker, 27, pleaded guilty to conspiracy to distribute heroin and oxycodone before Chief United States District Judge Robert C. Chambers in Huntington.
On August 7, 2013 Walker’s vehicle was stopped by members of the Ohio Highway Patrol. During the traffic stop, police found approximately 300 grams of heroin and 498 oxycodone pills inside of Walker’s vehicle.
Walker told police that he was en route to Huntington and intended to deliver the heroin and oxycodone to an associate.
Walker faces up to 20 years in federal prison when he is sentenced on April 14, 2014.
The Huntington Violent Crimes and Drug Task Force conducted the investigation. Assistant United States Attorney Gregory McVey is in charge of the prosecution.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Clearwater Man Sentenced to More Than 10 Years in Prison for Drug DistributionRead the Press Release
Tampa, Florida – U.S. District Judge Virginia M. Hernandez Covington has sentenced Keire Terrell Harvey (24, Clearwater) to 10 years and 10 months in federal prison for possession with intent to distribute 28 grams or more of crack cocaine.
Harvey pleaded guilty on October 15, 2013.
According to court documents, from June 2, 2013 to July 19, 2013, Harvey sold crack cocaine to an undercover Largo Police Department Detective, on five occasions. On July 29, 2013, Harvey was arrested when he showed up to a location, in Largo, to make another sale of crack cocaine to the undercover detective. At the time of his arrest Harvey was in possession of 32.8 grams of crack cocaine, which he intended to sell.
This case was investigated by the Largo Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney Maria Chapa Lopez.
Chubbuck Woman Sentenced for Theft of Government PropertyRead the Press Release
Judge Orders Defendant to Pay $88,390 in Restitution
POCATELLO – Barbara E. Waters, 61, of Chubbuck, Idaho, was sentenced today in United States District Court to five months in prison followed by five months of home detention and three years of supervised release for theft of government property, U.S. Attorney Wendy J. Olson announced. Judge N. Randy Smith of the Ninth Circuit Court of Appeals, sitting by designation as a district court judge, also ordered Waters to pay restitution of $88,390. She pleaded guilty to the charge on August 28, 2013.
According to the plea agreement, Waters was employed as the manager of the Aid for Friends Representative Payee Program, in which the Social Security Administration sends payments for beneficiaries to Aid for Friends. Aid for Friends then administers the funds and pays for the beneficiary’s personal expenses. According to the plea agreement, Waters had signing authority on the Aid for Friends Social Security Administration trust account at Wells Fargo Bank, where all beneficiaries’ Social Security funds are deposited. Waters admitted that from January 2006 to December 2010, she wrote checks on the trust account, without authorization, for personal expenses, including cash and credit card bills totaling $82,882. Waters also agreed to pay $5,500 in audit and investigative expenses to Aid for Friends.
The case was investigated by the Social Security Administration, Office of Inspector General-Office of Investigations, and the Pocatello Police Department.
Chandara Sam Sentenced to 14 Years Imprisonment for Conspiracy to Distribute HeroinRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Chandara Sam, 31, of Lowell, Massachusetts was sentenced to 168 months in prison, having pled guilty to the charge of conspiracy to distribute at least 100 grams of heroin. United States District Judge William K. Sessions III, sitting in Burlington, also sentenced Sam to 4 years of supervised release.
Court records show that Sam, who goes by the alias “Po” was taken into custody in April 2013 in White River Junction, after selling approximately 40 grams of heroin to an individual cooperating with law enforcement. Sam has been incarcerated since his arrest.Court records further show that Sam is a member of a larger group that distributed an especially strong form of heroin in the Burlington area from about mid-2011 through the time of Sam's arrest. This heroin is known as “Chi town” or “Chi”, short for Chicago, and has caused several overdoses. The Vermont State Police Drug Task Force began an investigation into Sam's heroin ring in December 2011.
In January 2013, members of the Essex Police Department and the Drug Enforcement Administration arrested two individuals, Edward Chavin, also known as “Tommy,” and Christopher Nason in the Handy’s Suites in Essex. Chavin was found in possession of more than 100 grams of heroin. He and Nason were subsequently indicted for conspiracy to distribute 100 grams or more of heroin, and both have pled guilty. The Handy’s Suites raid occurred following a heroin overdose in a nearby room. Investigation revealed that Chavin, Nason, and Sam were part of the same heroin ring, and that Chavin had been transporting heroin from Chicago to the Burlington area for nearly a year prior to his arrest.
Following Sam’s arrest, law enforcement in Lowell, Massachusetts executed a search warrant at his residence. They recovered another 30 grams of heroin, bullets, about $47,000 cash, part of a .45 caliber hand gun, and two digital scales. Court records reveal that Sam carried handguns and used violence during the time he trafficked heroin in Vermont. Sam has a criminal history that includes six prior felony offenses and several instances of unlawful weapons and firearms activity.For his crime, Sam faced a maximum penalty of 40 years in prison. In sentencing Sam, Judge Sessions noted the large volume of heroin Sam distributed, as well as its potency. Judge Sessions also cited Sam’s use of guns and violence during the drug conspiracy, and his significant criminal history.
The investigation was a collaborative effort of the Vermont State Police Drug Task Force; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, and Firearms; the Essex and Burlington, Vermont Police Departments; and the Lowell, Massachusetts Police Department.
Assistant United States Attorney Christina Nolan prosecuted the case. Sam is represented by Jean-Claude Charbonneau of Rutland, Vermont.
Canadian Man Pleads Guilty to Importation of EcstasyRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Anthony Ighodaro, 32, of Toronto, Ontario, pleaded guilty before U.S. District Richard J. Arcara to the importion of ecstasy pills containing both 3,4 Methylenedioxymethamphetamine, and N Benzylpiperazine [BZP] into the United States from Canada. The charge carries a maximum penalty of 20 years in prison, a $1,000,000 fine, or both.
Assistant U.S. Attorneys Thomas S. Duszkiewicz and Carol G. Bridge, who are handling the case, stated that on July 25, 2010, Ighodaro was attempting to enter the United States from Canada at the Peace Bridge Port of Entry. The defendant was referred by Customs and Border Protection officers to a secondary inspection because of inconsistencies in the information he provided concerning the rental vehicle he was operating. During the subsequent investigation, law enforcement officers, with the assistance of a narcotics detection K-9, found six duct taped bundles secreted in the rear bumper of the car which contained approximately 31,128 Ecstasy pills. The pills had a street value in excess of $620,000 and were believed to be destined for the Atlanta, Georgia area. Today’s conviction comes the day before Ighodaro was to go to trial on the charges.
The plea is the result of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction Special Agent in Charge James C. Spero and Customs and Border Protection, under the direction of Randy Howe, Acting Director of Field Operations.
Sentencing is scheduled for April 21, 2014 at 1:00 p.m. before Judge Arcara.California Corporation Sentenced for Defrauding U.S. CustomsRead the Press Release
BOSTON - All Fabrics, Incorporated, an importer based in California, was sentenced today for defrauding U.S. Customs to avoid paying duties on textile shipments.
All Fabrics, Incorporated, represented by its President, Ricky Chen, was sentenced by U.S. District Court Judge Nathaniel M. Gorton to five years of probation, $148,506 in restitution and a fine of $180,000. In August of 2013, All Fabrics pleaded guilty to 10 counts of entering goods to the United States by means of false statements.
Between 2006 and 2009, All Fabrics provided false consolidated invoices to U.S. Customs for hundreds of shipments of cotton, polyester, and other textiles imported from China through ports on the eastern and western coasts of the United States. Based on these invoices, U.S. Customs imposed importation duties far lower than what was actually due. Losses to U.S. Customs were $468,506 in total, $320,000 of which the company paid when first confronted with evidence of wrongdoing.
United States Attorney Carmen M. Ortiz and Bruce M. Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston, made the announcement today. The case was prosecuted by Andrew E. Lelling of Ortiz’s Economic Crimes Unit.
Bellevue Man who Defrauded Social Security Sentenced to Prison and Home DetentionRead the Press Release
A former Bellevue, Washington resident who collected his deceased mother’s Social Security benefits for more than 20 years was sentenced to prison today for his fraud, announced U.S. Attorney Jenny A. Durkan. RAYMOND C. O’DELL, 70, who now resides in Arizona, was sentenced to six months in federal prison, six months of home detention, $188,436 in restitution and a $20,000 fine for theft of government funds. O’DELL is the last of a series of defendants to be sentenced for illegally collecting Social Security benefits after the true recipient died. In this case O’DELL collected his mother’s Social Security benefits for 23 years, and on at least two occasions provided false information to the Social Security Administration to continue the fraud. At sentencing U.S. District Judge James L. Robart said O’DELL’s “decades of criminal behavior” required a prison sentence.
“Cheaters shred the safety net for those that really need it,” said U.S. Attorney Jenny A. Durkan. “It is disheartening to see this criminal conduct persist for 23 years even as the defendant built a successful business. Those who might be tempted to cheat the government of these funds need to know prison and hefty fines wait at the end of the scheme.”
According to records filed in the case, O’DELL’s mother died in November 1989, but he failed to notify Social Security and benefits continued to be paid into their joint account. On at least two occasions between November 1989 and June 2012, O’DELL contacted the Social Security Administration to update his mother’s contact information and never informed anyone of her death. In May of 2012, a Social Security Administration representative attempted to contact O’DELL’s mother by phone. O’DELL answered and said his mother was visiting a neighbor and promised to schedule a time for O’DELL’s mother to speak with the representative. Instead, O’DELL contacted a lawyer who contacted the U.S. Attorney’s Office about the criminal conduct. In fact, O’DELL had not only defrauded Social Security. He also fraudulently collected $100,000 in pension benefits from the Ohio Public Employees Retirement System. O’DELL is scheduled to enter a plea and be sentenced for that fraud in Ohio later this week.
Seven other defendants have been charged over the last year with theft of government funds for fraudulently collecting Social Security benefits for years after their parents’ death. As a result of the prosecutions, courts in this district have ordered in excess of $1 million in restitution to the United States. The following are the longest running of these frauds:
PATTY BUCHANAN, 57 is one of the largest Social Security benefit fraud cases prosecuted as part of the initiative in the Western District of Washington. BUCHANAN’s father died in May 1993, but she continued to receive and cash his benefit checks using a check cashing business. She told the outlet her father was infirm and homebound and that she had power of attorney. Every month for 19 years she cashed the checks – in all, 235 checks for a total of $239,083. When one of the tellers at the check cashing business became suspicious, BUCHANAN forged a fraudulent power of attorney document. When staffers at the outlet called to try to speak with BUCHANAN’s father, BUCHANAN had a male friend pretend to be her father. Ultimately, an anonymous tip to Social Security ended the fraud in December 2012. BUCHANAN was sentenced to 18 months in prison in June 2013.
DENNIS JAY GORIN, 76, of Eatonville, fraudulently collected about $100,000 in Social Security benefits belonging to his mother following her death in around 2003. GORIN did not notify federal or state authorities of his mother’s death and personally disposed of his mother’s body on property in a rural area. Between 2003 and 2013, GORIN forged his mother’s signature to embezzle an estimated $100,000 worth of Social Security benefits. GORIN pleaded guilty on May 21, 2013, and was sentenced in September 2013 to ten months in prison.
CLAUDIA RUTH GREENAMYER, 72, of University Place, fraudulently collected $219,960 following the death of her mother in 1996 and her father in 2000. The payments were made to bank accounts GREENAMYER held jointly with her parents. GREENAMYER continued to use the money without telling Social Security her parents were deceased. She forged signatures to continue the theft, and when confronted by agents in February 2013, she claimed to have seen her parents one month earlier. GREENAMYER pleaded guilty to theft of government funds on May 15, 2013 and was sentenced in September 2013 to three months in prison.
DAVID MICHAEL COSTA, 77, of Sammamish, fraudulently collected $297,948 of his mother’s Social Security benefits following her death in 1989. While COSTA originally thought the payments coming to the joint bank account were from an annuity, in 1992 he learned they were Social Security payments. Rather than alert authorities and pay back the $40,000 that had wrongly been paid, COSTA continued to collect the benefits for more than 15 years. COSTA forged his mother’s name on documents and substituted his address for hers on all records, updating it three different times over the years. COSTA pleaded guilty on June 3, 2013, and was sentenced in September 2013 to ten months in prison.
These cases were investigated by the Social Security Administration Office of Inspector General (SSA-OIG) and are being prosecuted by Special Assistant United States Attorney Seth Wilkinson as part of a partnership venture between the Social Security Administration Office of General Counsel and the United States Attorney’s Office.
Belleville Man Sentenced to Federal Prison for Possession of Stolen FirearmRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that Joel A. Dozier, 25, of Belleville, Illinois, was sentenced in federal district court in East St. Louis today for the crime of Possession of a Stolen Firearm.
Dozier was sentenced to 28 months in prison, to be followed by 3 years of supervised release, a $100 special assessment, and a fine of $500, following his plea of guilty, on September 9, 2013. The charges relate to an incident that occurred on February 7, 2013, in Belleville, Illinois, when police officers questioned Dozier about a recent robbery. Dozier began to act nervously and eventually admitted to the officers that he had gun in his pocket. The officers retrieved the gun (a DM22, .22 caliber derringer), which the officers determined had been stolen. Dozier admitted that he knew the gun had been stolen.
The case was investigated by members of the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Belleville Police Department. The case was prosecuted by Assistant U.S. Attorney Stephen B. Clark.
Baltimore Crack Dealer Sentenced to 12 Years in PrisonRead the Press Release
Baltimore, Maryland – U.S. District Judge Ellen L. Hollander sentenced Dontae Cox, age 30, of Windsor Mill, Maryland, today to 12 years in prison followed by four years of supervised release for distribution of crack cocaine. Judge Hollander also ordered Cox to forfeit $29,030 in cash seized during the investigation, as well as a .22 caliber handgun, loaded .22 caliber magazine, one box of 9mm ammunition, two digital scales and two money counters.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; and Chief James W. Johnson of the Baltimore County Police Department.
According to Cox’s plea agreement, on March 26, 2012, a confidential source called Cox who agreed to sell approximately 2 ounces (56 grams) of crack cocaine to the source at the Mondawmin Mall later in day. During their meeting later that day, the source entered a vehicle occupied only by Cox. The source gave Cox $2,400 in cash in exchange for approximately 2 ounces (56 grams) of crack cocaine.On April 3, 2012, the Baltimore County Police Department executed a search warrant at Cox’s residence and recovered 107.6 grams of crack cocaine and drug paraphernalia, including scales and money counters. During the execution of the search warrant and a vehicle stop earlier in the day, law enforcement recovered a total of $29,030 from Cox, which he admits that he earned from the distribution of narcotics.
United States Attorney Rod J. Rosenstein praised the DEA and Baltimore County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney David I. Sharfstein, who prosecuted the case.
Bakersfield Man Pleads Guilty to Illegal Cash DepositsRead the Press Release
BAKERSFIELD, Calif. — Miguel Antonio Ruiz Jaramillo, 66, of Bakersfield, pleaded guilty today to one count of aggravated structuring of cash transactions, U.S. Attorney Benjamin B. Wagner announced.
According to the plea agreement, Jaramillo operated a gardening service. He issued invoices that billed a client $10,000 or less. The client then would write checks for the amount on the invoice. From January 2010 through July 2012, Jaramillo cashed more than 50 checks for $10,000 or less at Valley Republic Bank in Bakersfield, totaling more than $420,000. Jaramillo had the checks cashed in this manner to prevent, or attempt to prevent, the bank from filing a Currency Transaction Report (CTR) on those transactions. He did not want a CTR filed because for the years 2010 and 2011, he did not declare the structured cash transactions as income on his federal tax returns.
This case is the product of an investigation by the Central California Financial Crimes Task Force (CCFCTF), which is dedicated to investigating and prosecuting money laundering and Bank Secrecy Act crimes in the San Joaquin Valley. CCFCTF is led by the Internal Revenue Service, Criminal Investigation, with participation from U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Drug Enforcement Administration, the Federal Bureau of Investigation, the Bakersfield Police Department, and the Fresno Police Department. Assistant United States Attorneys Grant B. Rabenn and Patrick Delahunty are prosecuting the case.
Jaramillo is scheduled to be sentenced on April 7, 2014. He faces a maximum statutory penalty of 10 years in prison and a $500,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Attorney General Announces $8.3 Million to <br /> Support Victims of Boston Marathon BombingsRead the Press Release
The U.S. Department of Justice’s Office for Victims of Crime (OVC) today announced a $8,355,648 grant to organizations providing direct support to assist the victims, witnesses and first responders involved in the events surrounding the Boston Marathon bombings in April 2013.
“This grant funding will provide critical support to many who were affected by last year’s terrorist attack on the Boston Marathon,” said Attorney General Eric Holder. “We will never forget the courage of the first responders, marathon participants, and bystanders who rushed to save lives on that terrible day, nor the heartbreak and pain of those who suffered injuries or lost friends and loved ones. With this grant, we reaffirm the Justice Department’s firm commitment to standing with the victims of this heinous crime – and all of the community leaders and service providers who continue to heal this remarkable and resilient city.”
On April 15, 2013, two pressure cooker bombs were detonated 13 seconds apart near the finish line of the Boston Marathon, killing three spectators and injuring hundreds more. On April 18, 2013, the suspects allegedly shot and killed an officer of the Massachusetts Institute of Technology Police Department. Subsequently, the two suspects allegedly carjacked a vehicle and took the vehicle’s owner hostage; he later escaped. On April 19, 2013, a Watertown, Mass., police officer identified the suspects and a gunfight ensued between the suspects and police in a Watertown neighborhood. This incident resulted in one suspect’s death when he was struck by a vehicle as the other suspect fled the scene. Later that day, police apprehended the remaining suspect in a different Watertown neighborhood. Victims affected include those in the vicinity of the bombings as well as the residents of neighborhoods in which subsequent events unfolded. An estimated 1,000 victims will require crisis and/or longer-term recovery services.
OVC provided the Antiterrorism and Emergency Assistance Program (AEAP) grant to the Massachusetts Office for Victim Assistance (MOVA).
“MOVA has worked diligently with OVC and our federal, state and local partners to serve those impacted by the Boston Marathon bombings, while planning a longer term solution to meet their evolving needs in the years to come,” said MOVA Executive Director Liam Lowney. “We are grateful to OVC for its continued support in developing a response that is tailored to specifically address the physical and emotional injuries caused to so many individuals, their families and our community as a whole by this tragedy.”
This award will include costs, both incurred and anticipated, for organizations providing crisis intervention services and trauma-informed care, continuum of care, socioeconomic support, wrap-around legal services and other victim assistance.
“OVC is committed to promoting healing and justice for all victims of crime,” said OVC Director Joye Frost. “We acknowledge the hardships that all victims of crime face and recognize the enormous physical, emotional and financial toll of the Boston bombings on victims and their loved ones. Many of these bombing victims face serious and protracted medical problems as well as long-term financial loss and emotional upheaval. This award will ensure that Boston and the state of Massachusetts can provide critical support to victims and their families as they work to restore a sense of normalcy to their lives.”
In 1995, following the Oklahoma City bombing, Congress authorized OVC to set aside and administer up to $50 million annually from the Crime Victims Fund for the Antiterrorism Emergency Reserve Fund to assist victims in extraordinary circumstances. Following an act of terrorism or mass violence, jurisdictions can apply for an AEAP grant award for crisis response, criminal justice support, crime victim compensation and training and technical assistance expenses. OVC also provided AEAP funds and assistance following the shootings in Newtown, Conn. (2012); Oak Creek, Wis. (2012); Aurora, Colo. (2012); Tucson, Ariz. (2011); Binghamton, N.Y. (2009); and at the Virginia Polytechnic Institute and State University (2007).
For more information on the AEAP program, please visit www.ojp.usdoj.gov/ovc/AEAP/index.html.
The Office of Justice Programs (OJP), headed by Assistant Attorney General Karol V. Mason, provides federal leadership in developing the Nation’s capacity to prevent and control crime, administer justice and assist victims. OJP has six components: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering and Tracking. More information about OJP can be found at www.ojp.gov.
Assemblyman Eric Stevenson Found Guilty in Manhattan Federal Court of Taking More Than $20,000 in Bribes in Exchange for Proposing Legislation and Performing Other Official ActsRead the Press Release
Preet Bharara, United States Attorney for the Southern District of New York, and Robert T. Johnson, the District Attorney for Bronx County, announced that New York State Assemblyman ERIC STEVENSON was found guilty in Manhattan federal court of taking more than $20,000 in bribes from four businessmen in exchange for STEVENSON’s official acts, including drafting, proposing, and agreeing to enact legislation that favored the bribers’ business interests. Specifically, the four businessmen, who sought to operate and construct adult day care centers in the Bronx, paid STEVENSON to sponsor and introduce legislation that would declare a three-year moratorium on the construction of adult day care centers in New York City, but from which their current centers would be exempted, in effect giving the businessmen a monopoly in adult day care centers in the area. In connection with one of the defendants’ adult day care centers on Jerome Avenue in the Bronx (the “Jerome Avenue Center”), in exchange for bribes by the businessmen, STEVENSON, in his official capacity as an Assemblyman, contacted Con Edison and the New York City Department of Buildings at their request. In addition, in exchange for bribes, STEVENSON held public events paid for by the businessmen to recruit senior citizens to attend a second center on Westchester Avenue in the Bronx (the “Westchester Avenue Center”). STEVENSON was convicted after a six-day jury trial before U.S. District Judge Loretta A. Preska.
Manhattan U.S. Attorney Preet Bharara said: “As a unanimous jury swiftly found, Assemblyman Stevenson brazenly betrayed the public that elected him. Graft and greed are intolerable in Albany, and we will go to trial as often as we have to until government in New York is cleaned up. As Assemblyman Stevenson readies himself to serve a likely prison term, he serves more importantly as a reminder of what happens to politicians who court only cash and throw their oath to the curb.”
Bronx County District Attorney Robert T. Johnson said: "I am grateful that the U.S. Attorney and our office were successful in uncovering and bringing to justice an elected official who betrayed the public trust by offering his vote for sale. It is fortunate that we were able to root out this corruption before this politician could do serious damage to the legislative process."
STEVENSON has served as a member of the New York State Assembly since 2011 representing District 79, which includes various neighborhoods in the Bronx. The four businessmen – Igor Belyansky, Rostislav Belyansky, a/k/a “Slava,” Igor Tsimerman, and David Binman – are individuals who, during 2012 and 2013, were seeking to open and manage adult day care centers in the Bronx, New York, including the Westchester Avenue Center, within STEVENSON’s Assembly District, and the Jerome Avenue Center, within another Assemblyman’s District. During that time period, they paid multiple bribes to STEVENSON in connection with efforts to open and operate both centers.
For example, at a meeting on July 23, 2012, STEVENSON, Belyansky, and Tsimerman discussed the opening of the Westchester Avenue Center. During this meeting, STEVENSON said that on the following Thursday, July 26, 2012, he was “having a night [event]” for “my reelection” and that he needed “support and help like everyone else.” Subsequently, on July 25, 2012, Slava provided a cooperating witness (the “CW”) with a check for $2,000 made out to STEVENSON’s political action committee, which the CW provided to STEVENSON. STEVENSON did not disclose this check as a campaign contribution as required by New York State Law.
At a September 7, 2012 meeting at a steakhouse in the Bronx, Belyansky and Slava offered to pay STEVENSON $10,000 in exchange for calling Con Edison to expedite the installation of a gas line and assisting with obtaining a Certificate of Occupancy from the New York City Buildings Department at the Jerome Avenue Center, and for assistance recruiting senior citizens to attend the Westchester Avenue Center. STEVENSON agreed, but when Belyansky attempted to hand him the $10,000 in an envelope, STEVENSON indicated that he was concerned that there might be surveillance cameras in the restaurant, so waited until he was outside of the restaurant to take the cash bribe. On September 18, 2012, STEVENSON gave the CW a $1,500 cut of the $10,000 bribe in exchange for the CW’s assistance, and promised to pay the CW an additional $500.
On December 27, 2012, the CW met with STEVENSON and showed STEVENSON a copy of an email dated December 26, 2012, sent from the contractor for the Jerome Avenue Center to Slava and Tsimerman. In the email, the contractor stated that “[i]t is urgent . . . that we call the State Senator Eric Stevenson so that he can call the building department at once and ask them to have this application reviewed” in connection with getting “a permit to install the gas lines into the building.” After reviewing this email, STEVENSON stated, “he’s not a smart guy . . . he’s not too bright, this guy” because “he put this in writing . . . why he got to put my name in it? . . . He shouldn’t have said that.” STEVENSON said they needed to avoid creating a “paper trail.”
During that meeting, the CW and STEVENSON also discussed the possibility of STEVENSON introducing legislation that would establish a temporary moratorium on the construction and/or opening of new adult day care centers (the “Moratorium Legislation”), which would have the effect of eliminating competition with the Jerome Avenue Center and the Westchester Avenue Center, thereby substantially increasing the profits earned by those two centers. STEVENSON told the CW: “All you gotta do is tell me what you want in the bill, and the bill drafter will put it together…I just need you to tell me what they [the co-defendants] want; we prepare the bill . . . . You can write down the language, basically what you want.” STEVENSON then asked: “Are Igor [Belyansky] and them putting together a nice little package [of money] for me, huh?” He said: “I got my inauguration I gotta take care of, I got a lot of sh*t man.” STEVENSON then said to the CW, in reference to the legislation, “I’m telling you, it’s done. It’s no problem.” Subsequently, the CW met with Tsimerman and Belyansky. Tsimerman said that as a result of the Moratorium Legislation, the value of their adult day care centers was “gonna skyrocket. . . . As long as [there’s a] moratorium, I can guarantee you at least a triple [in profits].”
On January 1, 2013, the CW and STEVENSON spoke on the telephone and STEVENSON referred to “Igor” [Belyansky] as “Santa,” in reference to the money he expected to receive. In a subsequent meeting on the same day in the CW’s car, STEVENSON sought assurances that “Igor” [Belyansky] was going to “bless everything,” meaning pay STEVENSON. He added that: “I got the inauguration, I want a blessing [payment] in place, man.” Two days later, the CW gave Belyansky and Slava a copy of a document titled “Proposed Adult Day Care Center Bill,” which contained a proposal for the Moratorium Legislation. On January 7, 2013, the CW provided the same proposal to STEVENSON. Later that day, Tsimerman provided STEVENSON with another copy of the proposal containing Tsimerman’s notes. On January 9, 2013, the CW told Belyansky that STEVENSON wanted $10,000 for the Moratorium Legislation, with $5,000 paid up front. Two days later, on January 11, 2013, at the Westchester Avenue Center, Belyansky, Slava, Tsimerman, and Binman gave the CW $5,000 cash. The CW then left the Westchester Avenue Center with the envelope of money and got in his car where STEVENSON joined him, at which time the CW gave the envelope of money to STEVENSON, after taking out his $500 cut.
On January 27, 2013, STEVENSON met with the CW and told the CW that he was concerned that Tsimerman might be cooperating with law enforcement officials and recording their conversations. STEVENSON expressed a concern that if “they bring me down… somebody’s going to the cemetery.”
STEVENSON had a draft of the Moratorium Legislation prepared by January 31, 2013, which he showed the CW at a meeting in his office and which was consistent with the bullet points prepared by the CW and Belyansky, Slava, Tsimerman, and Binman. On February 11, 2013, STEVENSON told the CW: “We got the bill [the Moratorium Legislation] back today . . . [t]he bill is done now, it’s going out to the members . . . to the committee and . . . we’re gonna . . . try to push it to get it to the floor.” On February 16, in a hotel room in Albany, SLAVA gave $5,000 in cash to the CW, which the CW gave to STEVENSON after taking a $500 cut. While the CW took out his $500 cut, STEVENSON walked into the bathroom of the CW’s room and left the door open so that he could receive the $4,500 cash in the bathroom.
STEVENSON introduced and sponsored Bill Number A05139, which places a temporary moratorium on the construction and/or opening of new adult day care centers within New York City on February 20, 2013, and it is currently pending before the New York State Assembly’s Committee on Aging.
Two days later, in a meeting between the CW and Belyansky, Tsimerman, and Binman, Belyansky said that the legislation would double the value of his share in the Jerome Avenue and Westchester Avenue Centers from approximately $350,000 to $700,000.
In the course of recorded conversations between STEVENSON and the CW, STEVENSON repeatedly referenced the convictions and sentences of other New York officials for crimes of public corruption, even as STEVENSON himself requested bribes. For example, during one meeting between STEVENSON and the CW on December 27, 2012, STEVENSON observed, “if half of the people up here in Albany was ever caught for what they do . . . they . . . would probably be in [jail] . . . so who are they bullsh**ing?” During another meeting, on January 1, 2013, after discussing the convictions of former New York State Senator Carl Kruger, former New York State Senator Pedro Espada, Jr., and former New York State Comptroller Alan Hevesi, STEVENSON commented on being “careful” about “the recorders and all those things” that informants wear in order to be careful not to “put yourself in jail.”
STEVENSON, 47, of the Bronx, New York, was convicted of one count of conspiring to commit honest services wire fraud, which carries a maximum sentence of 20 years in prison, one count of conspiring to commit federal programs bribery and to violate the Travel Act, which carries a maximum sentence of 5 years in prison, one count of committing federal programs bribery, which carries a maximum sentence of 10 years in prison, and one count of extortion under color of official right, which carries a maximum sentence of 20 years in prison. Each of the counts of conviction also carries a maximum fine of $250,000, or twice the gross gain or loss from the offense. STEVENSON is scheduled to be sentenced by Judge Preska on May 20, 2014.
Belyansky, Slava, Tsimerman, and Binman all pled guilty to conspiring to commit honest services wire fraud in connection with their payment of bribes to STEVENSON before United States District Judge William H. Pauley III. They are scheduled to be sentenced by Judge Pauley on January 24, 2014.
Mr. Bharara praised the work of the investigators from the United States Attorney’s Office for the Southern District of New York and the District Attorney’s Office for Bronx County.
This prosecution is being handled by the Office’s Public Corruption Unit. Assistant U.S. Attorneys Paul M. Krieger and Brian A. Jacobs and Special Assistant U.S. Attorney Pishoy Yacoub of the Bronx County District Attorney’s Office are in charge of the prosecution.
U.S. v. Eric Stevenson et al. S2 Indictment
Ambridge Man Admits Serving as A "Lookout" for Baden Pharmacy BurglaryRead the Press Release
PITTSBURGH – A Beaver County resident pleaded guilty in federal court to a charge of violating federal burglary laws, United States Attorney David J. Hickton announced today.
Carlos Martinez, 27, of Ambridge, Pa., pleaded guilty to one count of burglarizing a pharmacy before United States District Judge Arthur J. Schwab.
In connection with the guilty plea, the Court was advised that Martinez conspired with others to burglarize the Med-Fast pharmacy in Baden, Pa., on September 26-27, 2012, and from that pharmacy, stole controlled substances, including oxycodone and oxymorphone. In that regard, the Court learned that Martinez conspired together with separately charged defendants David Best and Katie Adams to burglarize the pharmacy. On the evening of Sept. 26, 2012, Adams allegedly drove Best and Martinez to the pharmacy. Best first broke into the Chinese restaurant next door to the pharmacy, and from there, bore through the wall of the restaurant and into the pharmacy. Once inside the pharmacy, Best allegedly stole the controlled substances. While Best was inside the pharmacy, Martinez served as a "lookout" outside the pharmacy. Best then left the pharmacy, and Katie Adams, the "getaway" driver, drove Martinez and Best away from the pharmacy. The three persons later split the obtained narcotics amongst themselves. Katie Adams and David Best have pleaded not guilty to the charges against them.
Judge Schwab scheduled sentencing for April 30, 2014, at 9:30 a.m. The law provides for a total sentence of up to 20 years in prison, a fine of not more than $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Eric S. Rosen is prosecuting this case on behalf of the government.
The Drug Enforcement Administration conducted the investigation that led to the prosecution of Carlos Martinez.
Alabama Man Pleads Guilty to Tax Fraud and Identity TheftRead the Press Release
Nakia Jackson pleaded guilty to one count of conspiracy to defraud the United States and one count of aggravated identity theft for his role in a stolen identity refund fraud scheme, announced Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division, U.S. Attorney George L. Beck Jr. for the Middle District of Alabama and the Internal Revenue Service (IRS).
According to court documents, between January 2009 and March 2011, Jackson obtained stolen identities from an Alabama state employee and used those identities to file false tax returns. Jackson recruited a bank employee, LaQuanta Clayton, to assist him in having the false income tax refunds deposited into various bank accounts. He obtained permission from several individuals to use their bank accounts to receive false refunds and when a false refund was deposited, Jackson would direct the individuals to withdraw the money and give the money to him. In total, Jackson filed over 100 false tax returns and requested over $400,000 in refunds.
Sentencing has been scheduled for April 23, 2014. Jackson faces a statutory minimum sentence of two years in prison and a statutory maximum sentence of 12 years in prison, three years of supervised release, restitution and a maximum fine of $250,000, or twice the loss caused by the offense. LaQuanta Clayton has already pleaded guilty and is awaiting sentencing.
IRS-Criminal Investigation agents investigated this case and Tax Division Trial Attorneys Charles M. Edgar Jr. and Michael Boteler and Assistant U.S. Attorney Todd Brown are prosecuting the case.
More information about the Tax Division and its enforcement efforts can be found at www.justice.gov/tax .
12 January 2014
Former Social Security Administrator Sentenced to Federal Prison for Aggravated Identity Theft, Unauthorized Sale of Stock Certificates, Tax EvasionRead the Press Release
PROVIDENCE, R.I. – Randolph Hurst, 50, of West Warwick R.I., a former Assistant District Manager for the Social Security Administration in Rhode Island, was sentenced Friday to 39 months in federal prison for stealing the identity of a Coventry, R.I., man and using his identity to fraudulently sell more than $160,000 worth of stock certificates belonging to the victim, and for failing to pay $61,999 in taxes owed the IRS.
U.S. District Court Chief Judge William E. Smith also ordered Hurst to serve 3 years supervised release upon completion of his term of imprisonment and to pay restitution in the amount of $245,299.56, reflecting the current value and earned dividends to date of the stolen stocks. Hurst pleaded guilty on October 9, 2013, to one count each of aggravated identity theft, transportation of stolen securities and tax evasion; two counts of mail fraud; and three counts of filing a false tax return.
A co-defendant in this matter, Justin Silveira, 29, of Coventry, R.I., was sentenced Friday to 15 months in federal prison, to be followed by 2 years supervised release. Silveira pleaded guilty on October 9, 2013, to two counts of perjury and one count of obstruction of justice. Silveira admitted to the court that he lied to a grand jury which was investigating this matter. According to information presented to the court, during lengthy testimony before the grand jury, Silveira repeatedly falsely implicated a family member of the victim as having participated in the scheme. Silveira’s testimony caused the government to invest significant time and expense to investigate the false allegations.
The sentences were announced by United States Attorney Peter F. Neronha; Vincent B. Lisi, Special Agent in Charge of the Boston field office of the FBI; Cheryl Garcia, Acting Special Agent in Charge of the New York region of the U.S. Department of Labor, Office of Labor Racketeering and Fraud Investigations; John Collins, Acting Special Agent in Charge of the Boston office of the Internal Revenue Service, Criminal Investigation; and Scott E. Antolik, Special Agent in Charge of the Boston field office of the Social Security Administration, Office of the Inspector General/Office of Investigations.
At the time of his guilty plea, Hurst admitted to the court that in September 201, he stole personal identifying information belonging to the victim and used it to open a joint account at a Providence brokerage firm in his name and in the name of the victim, without the victim’s permission. Two days after opening the account he provided documentation purportedly authored and signed by the victim, requesting the deposit of stock certificates owned by the victim. The victim never authorized the deposit of the stock certificates.
Hurst admitted to the court that in October 2010, without the victim’s knowledge, he requested that the stocks be sold and a check be issued in his name and in the victim’s name for $157,747.49, which represented a portion of the proceeds of the sale of the stocks. Hurst requested the check be sent by courier to the residence of Justin Silveira. On October 22, 2010, on the same day Hurst deposited the check into a bank account owned jointly by Hurst and his wife, Hurst requested a second check be issued in his name and in the victim’s name for, $3,980.46, which represented the remaining proceeds of the sale of the stocks. Hurst requested that the check be sent to Silveira’s residence. On November 8, 2010, the second check was deposited into a bank account shared by Hurst and his wife. Hurst admitted to the court that he and his wife spent the proceeds of the sale of the stock on personal items and personal expenses.
The defendants were ordered to self-surrender to the U.S. Marshals Service or the Bureau of Prisons on January 31, 2014.
The case was prosecuted by Assistant U.S. Attorney Dulce Donovan.
The matter was investigated by federal agents from the FBI; U.S. Department of Labor Office of Labor Racketeering and Fraud Investigations; Internal Revenue Service – Criminal Investigation; and Social Security Administration, Office of the Inspector General/Office of Investigations.
This federal law enforcement action was brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it is 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.
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