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Wednesday 6 November 2013
School Proctor and Admissions Officer Plead Guilty in Student Financial Aid Fraud SchemeRead the Press Release
Three Defendants Convicted to Date for Changing Test Scores to Qualify Students for Federal Grants
Baltimore and Greenbelt, Maryland – Jacqualyn Sue Caldwell, age 55, of Baltimore, and Jesse Raymond Moore, Sr., age 30, of Crofton, Maryland, pleaded guilty today to conspiring to defraud a student financial aid program.
The guilty pleas were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; and Steven Anderson, Special Agent in Charge of the U.S. Department of Education, Office of Inspector General Mid-Atlantic Regional Office.“Students without high school diplomas who applied for financial aid to attend trade schools were required to pass the Ability to Benefit test and demonstrate their aptitude to complete the educational program and work in the field,” said U.S. Attorney Rod J. Rosenstein. “By cheating, the defendants defeated the purpose of the tests and defrauded the government.”
Caldwell was a test administrator for a company that offered cognitive tests to schools and businesses. During her employment, Caldwell worked almost exclusively as a test proctor for student admissions at the All-State Career School, a for-profit trade school located on Broening Highway in Baltimore. Moore worked as an admissions representative for All-State. Moore was paid a salary and was eligible for performance-based raises and commissions for each student that graduated.
Students who applied for federal financial aid at All-State were required to have a high school diploma, possess a GED, or pass a designated Ability to Benefit (ATB) test. Caldwell was certified to administer the ATB test onsite at All-State’s campus. Her duties did not include scoring the tests; rather, she was to collect the students’ answer sheets, seal them in an envelope and mail them to her company employer’s headquarters in Illinois, where they were scored and the results sent back to All-State. The ATB test used a Scan Tron answer sheet that required students to use pencils to fill in circles next to the correct answers. Student applicants who failed the ATB test the first time could take it again.
According to Caldwell’s plea agreement, soon after starting her job as a test proctor at All-State in 2008, an All-State admissions representative asked Caldwell for an applicant’s answer sheet so that the representative could change some of the applicant’s answers to allow the applicant to pass the test. Caldwell agreed. Caldwell allowed the representative access to the answer sheet by not sealing the envelope containing the applicants’ answer sheets and leaving the envelope on the receptionist’s desk. After the admissions representative corrected the applicant’s wrong answers, the representative put the answer sheet back into the envelope, sealed it and left it to be mailed. Thereafter, this process was repeated by the representative for other applicants. Caldwell also agreed to employ the same process for a second representative.
Subsequently, the second representative suggested a different method to change the answers on the ATB test which Caldwell agreed to do. The representative gave Caldwell a completed Scan Tron answer sheet which allowed Caldwell to erase and change just enough incorrect answers to provide a passing grade. The representative told Caldwell which student applicants were taking the test for a second time, so that Caldwell could correct their answer sheets.
Although the first two representatives agreed not to tell anyone that Caldwell was changing test scores for their student applicants, a third admissions representative asked Caldwell to change scores on answer sheets, which Caldwell agreed to do. Thereafter, Caldwell was continuously approached in the hallways by the three admissions representatives about “helping” a student pass the ATB test on the second try, and Caldwell agreed to do it every time.
According to Moore’s plea agreement, Moore learned through another admissions representative that Caldwell could ensure that students who failed the ATB the first time would pass it the second time. Between January and December 2011, Caldwell agreed to Moore’s requests to help prospective students pass the test the second time.
Additionally, All-State admissions representative Barry Sugarman, age 63, of Owings Mills, pleaded guilty on March 13, 2013 to the conspiracy. Sugarman admitted that he also asked Caldwell to manipulate the test results to give applicants taking the test a second time a passing score, which she did. Sugarman also told prospective students to understate their income from previous years when they applied for federal aid in order to qualify for the maximum amount of Pell grants and student loans.
During her tenure at All-State from 2008 to December 2011, Caldwell changed the answer sheets for approximately 170 students. Approximately 102 of them went on to enroll at All-State and became eligible to receive federal financial aid in the form of Pell Grants and student loans. Approximately 72 of those students received financial aid totaling approximately $572,255.
Caldwell, who pleaded guilty to a felony, faces a maximum sentence of five years in prison and a fine of $250,000 or not more than the greater of twice the pecuniary loss or gain from the fraud. Moore and Sugarman, who each pleaded guilty to a misdemeanor, face a maximum sentence of one year in prison. U.S. District Judge George L. Russell, III scheduled sentencing for Caldwell in federal court in Baltimore on February 14, 2014 at 9:30 a.m. U.S. Magistrate Judge Timothy J. Sullivan scheduled sentencing for Sugarman and Moore in federal court in Greenbelt on December 18, 2013 and January 28, 2014, respectively.
United States Attorney Rod J. Rosenstein praised the FBI and Department of Education, Office of Inspector General for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Martin Clarke, who is prosecuting the cases.Rosebud Man Charged and Sentenced for Theft of Governement PropertyRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota, man convicted of Theft of Government Property has pled guilty to the charge and was sentenced on November 4, 2013, by U.S. Magistrate Judge Mark A. Moreno.
Christopher Menard, age 39, was ordered to pay a $350 fine, $150.08 in restitution, and $25 to the Federal Crime Victims Fund.
The conviction stems from incidents that occurred on three separate occasions between December 3, 2012, and January 19, 2013, when Menard used gas cards that belonged to the Bureau of Indian Affairs Fire Management Office to steal gas money, which he put into his own personal vehicle.
The investigation was conducted by the U.S. Department of Interior – Office of Inspector General. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Rochester Man, A Registered Sex Offender, Convicted of Attempted Sexual Enticement of A Minor and Attempted Production of Child PornographyRead the Press Release
BINGHAMTON, NEW YORK – On October 10, 2013, a federal jury in Binghamton found JOHN LAWRENCE DOOLEY, 56, of Rochester, New York, guilty of (1) attempted enticement of a minor to engage in sexual activity, (2) attempted production of child pornography, and (3) committing a felony offense involving a minor while already required to register as a sex offender, announced United States Attorney Richard S. Hartunian, Andrew W. Vale, Special Agent-in-Charge, Federal Bureau of Investigation, Albany Division, and Gregory Veitch, Chief, Saratoga Springs Police Department. DOOLEY faces at least 45 years and up to life imprisonment, a term of supervised release of at least five years and up to lifetime supervision, and a maximum fine of $500,000. DOOLEY is scheduled to be sentenced on February 10, 2014, before the Honorable Thomas J. McAvoy, Senior United States District Judge, in Albany, New York.
DOOLEY, a registered Level III sex offender, was arrested on May 11, 2012 in Saratoga Springs, New York, after he travelled there to meet “Kara,” a fifteen year old girl he met in a Yahoo! chat room. DOOLEY had been communicating with “Kara” for one and one-half months via Yahoo! Messenger. In reality, “Kara” was an undercover Saratoga Springs Police Investigator. During the online communications, the undercover investigator repeatedly told DOOLEY that “Kara’s” age was 15. DOOLEY told “Kara” that he would travel to Saratoga Springs, rent a motel room, have sex with her in the motel room, and capture that sexual conduct on digital photo and video. On May 11, 2012, Dooley drove from Rochester to Saratoga Springs, checked into his motel room, and brought with him various sexual devices, vodka, computer equipment, cameras, and presents for “Kara,” including lingerie.
This prosecution resulted from an investigation conducted by the Federal Bureau of Investigation, Albany, N.Y., and the Saratoga Springs Police Department. The case was prosecuted by Assistant United States Attorneys Jeffrey C. Coffman and Lisa Fletcher. Further questions may be directed to Assistant U.S. Attorney Elizabeth C. Coombe at (518) 431-0247.
Restaurant Owners in Olathe Charged with Harboring Undocumented WorkersRead the Press Release
KANSAS CITY, KAN. – The owners of Wei’s Super Buffet restaurant in Olathe have been charged with harboring undocumented workers who were in the United States unlawfully, U.S. Attorney Barry Grissom said today.
A federal criminal complaint filed in U.S. District Court in Kansas City, Kan., alleges the owners and managers of the restaurant violated federal law by knowingly employing, transporting and housing undocumented workers.
The following defendants were charged with one count of conspiracy to transport undocumented workers; conceal, harbor and shield undocumented workers; and encourage or induce undocumented workers to unlawfully enter or remain in the United States.
Wei Liu, 40,Olathe, Kan., owner of Wei’s Super Buffet at 12225 Strang Line Road in Olathe and Wei’s Super Buffet at 7531 Wornall Road in Kansas City, Mo.
Xiang Liu, 35, Olathe, Kan., Wei Liu’s wife and restaurant manager.
Jin Hui Liu, 47, Olathe, Kan., Wei Liu’s brother in law.
Huiqing Liu, 44, Olathe, Kan., Wei Liu’s sister.
Quan Liu, 25, Kansas City, Mo., manager of the Wei’s Super Buffet in Kansas City, Mo.
Bin Liu, 39, Olathe, Kan.An investigator’s affidavit filed in support of the complaint alleges that beginning in February 2011 agents of Homeland Security Investigations began surveillance on the owners, managers and employees at Wei’s Super Buffet. They checked Quarterly Wage Report and Unemployment Tax Returns submitted by the restaurant to the Kansas Department of Labor and they identified employees who were illegally present in the United States. They also identified apartments rented by the defendants where undocumented workers were living.
On Nov. 5, 2013, investigators served search and seizure warrants. During a search of Wei and Xiang Liu’s residence, where Biu Liu also resided, they found boxes of records associated with the daily operations of the restaurant and ledgers identifying the restaurant’s revenue. During the search of Jin Hui and Huiqing Liu’s residence, they found six undocumented workers residing the basement, all of whom worked at the restaurant. During the search of an apartment leased by Quan Liu near the restaurant in Kansas City, Mo., they found six undocumented workers residing there.
If convicted, the defendants face a maximum penalty of 10 years in federal prison and a fine up to $250,000.
The Department of Homeland Security (DHS), Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) investigated. Assistant U.S. Attorney Scott Rask is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Real Estate Developer Sentenced to Federal Prison for Mortgage Fraud OffensesRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that JOHN J. DORAN, 64, of Niantic, formerly of Deep River, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 12 months and one day of imprisonment, followed by five years of supervised release, the first six months of which DORAN must serve in home confinement under electronic monitoring. On April 4, 2013, DORAN pleaded guilty to one count of making false statements to influence a bank in connection with a mortgage application.
For much of his professional life, DORAN has been a builder and construction manager of high-end homes and real estate developments throughout Connecticut. According to court documents and statements made in court, in March 2005, DORAN submitted a false individual tax return to JP Morgan Chase in connection with a $500,000 refinance loan application. The tax return indicated that his adjusted gross income for 2003 was $296,735 when, in fact, the actual 2003 tax return he filed with the Internal Revenue Service showed an adjusted gross income of -$81,911.
In March 2007, DORAN submitted false individual 2003 and 2004 tax returns in connection with a loan application to Wachovia Dealer Services to finance the purchase of a yacht.
In May 2007, DORAN applied to Bank of America for a mortgage to purchase a condominium in New Haven. In connection with the application, DORAN submitted a false individual tax return that indicated that his adjusted gross income for 2004 was $464,197 when, in fact, his actual 2004 tax return showed an adjusted gross income of -$69,298. DORAN also submitted to the bank a fictitious sale contract for his personal residence in Deep River and a false bank statement.
DORAN subsequently defaulted on the three loans.
As part of his sentence, Judge Chatigny ordered DORAN to pay restitution of $991,883.65.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorney David T. Huang.
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[email protected]Rapid City Man Pleads Not Guilty to Child Pornography ChargesRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for allegedly downloading images of child pornography onto a computer in September 2013.
Rodney Volker, age 67, was indicted by a federal grand jury on October 22, 2013, for Possession of Child Pornography and Receipt of Child Pornography. Volker appeared before U.S. Magistrate Judge Veronica L. Duffy on November 4, 2013, and pled not guilty to the Indictment.
The penalty upon conviction for the Possession charge is a mandatory minimum of 10 years and up to 20 years of imprisonment and a $250,000 fine, and for Receipt of Child Pornography the penalty is a mandatory minimum of 5 years and up to 20 years of imprisonment and a $250,000 fine. The charges are merely accusations and Volker is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rapid City Police Department and the South Dakota Internet Crimes Against Children Taskforce. Assistant U.S. Attorney Sarah Collins is prosecuting the case.
Volker was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Randall Michael Lawson Sentenced to 216 Months in Prison and Lifetime Supervision for Narcotics, Firearms, Money Laundering, and Social Security Fraud ConvictionsRead the Press Release
GREENEVILLE, Tenn. – Randall Michael Lawson, 58, of Limestone, Tenn., was sentenced on Nov. 6, 2013, to serve 216 months in prison, followed by lifetime of supervised release, by the Honorable J. Ronnie Greer, U.S. District Judge. Lawson was also ordered to pay restitution to the Social Security Administration in the amount of $10,784.16; forfeit two firearms, and pay a $3 million judgment to the United States.
Lawson pleaded guilty in August 2012 to a federal indictment charging him with conspiracy to distribute and to possess with the intent to distribute 1,000 kilograms or more of marijuana; conspiracy to distribute and possess with intent to distribute five kilograms or more of cocaine; conspiracy to commit money laundering; social security fraud; and, being a felon in possession of firearms.
Lawson admitted to conspiring to distribute approximately 14,400 pounds, or 6,545 kilograms, of marijuana and 24 kilograms of cocaine between December 2002 and December 2010. Additionally, in a related case, Lawson was convicted in North Carolina of possessing two firearms after having been convicted of a prior felony offense.
As a result of this investigation, several other individuals have been convicted and sentenced for their involvement in the drug conspiracies.
On Apr. 25, 2013, Michael L. Dykes, 51, of Rogersville, Tenn., was sentenced to serve 37 months in prison, followed by one year of supervised release. Dykes was allowed to remain on bond until reporting to the Bureau of Prisons to serve his sentence. He pleaded guilty in January 2013 to conspiracy to distribute and possess with intent to distribute marijuana and conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Apr. 16, 2013, Lorne L. Loucel, 32, of Rogersville, Tenn., was sentenced to serve 108 months in prison, followed by three years of supervised release. Loucel pleaded guilty in December 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Apr. 16, 2013, Daniel L. Dykes, 29, of Rogersville, Tenn., was sentenced to serve 37 months in prison, followed by three years of supervised release. Dykes pleaded guilty in December 2012 to conspiracy to distribute and possess with intent to distribute marijuana and conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Apr. 2, 2013, Christy D. Dykes, 32, of Rogersville, Tenn., was sentenced to serve 40 months in prison, followed by three years of supervised release. Dykes pleaded guilty in November 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Mar. 21, 2013, Christy R. Seay, 39, of Greeneville, Tenn., was sentenced to serve 57 months in prison, followed by three years of supervised release. Seay pleaded guilty in September 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Mar. 11, 2013, Ella Maria Camacho Garcia, 30, of Burlington, N.C., was sentenced to serve 78 months in prison, followed by two years of supervised release. Garcia pleaded guilty in August 2012 to conspiracy to distribute and possess with intent to distribute marijuana and a conspiracy to distribute and to possess with the intent to distribute cocaine. Garcia also pleaded guilty to money laundering and received a money judgment in the amount of $815,000.00.
On Mar. 7, 2013, Jonathan L. Light, 24, of Kingsport, Tenn., was sentenced to serve 84 months in prison, followed by three years of supervised release. Light pleaded guilty in August 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Mar. 7, 2013, Levi D. Love, 24, of Kingsport, Tenn., was sentenced to serve 37 months in prison, followed by three years of supervised release. Love was allowed to remain on bond until reporting to the Bureau of Prisons to serve his sentence. Love pleaded guilty in August 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Mar. 4, 2013, Charles Thomas Laing, 30, of Rogersville, Tenn., was sentenced to serve 157 months in prison, followed by four years of supervised release. Laing pleaded guilty in September 2011, to conspiracy to distribute and possess with intent to distribute oxycodone pills, possession of a firearm in furtherance of a drug trafficking offense, and money laundering.
On Feb. 28, 2013, Jessica R. Bernard, 23, of Greeneville, Tenn., was sentenced to serve 37 months in prison, followed by three years of supervised release. Bernard pleaded guilty in September 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Feb. 28, 2013, Amanda D. Bernard, 23, of Afton, Tenn., was sentenced to serve 37 months in prison, followed by three years of supervised release. Bernard pleaded guilty in August 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Feb.26, 2013, Shandeeda M. Compton, 31, of Rogersville, Tenn., was sentenced to serve 63 months in prison, followed by three years of supervised release. Compton pleaded guilty in October 2012 to conspiracy to distribute and possess with intent to distribute oxycodone pills.
On Feb. 25, 2013, Brock A. Lawson, 26, of Rogersville, Tenn., was sentenced to serve 118 months in prison, followed by five years of supervised release. Lawson pleaded guilty in July 2012 to conspiracy to distribute and possess with intent to distribute marijuana.
On Apr. 25, 2013, James Light, 65, of Rogersville, Tenn., was sentenced to serve 150 months in prison, followed by four years of supervised release. Light pleaded guilty in December 2012 to conspiracy to distribute and to possess with the intent to distribute 500 grams or more of cocaine and a conspiracy to distribute and possess with intent to distribute oxycodone.
On Apr. 25, 2013, Michael L. Dykes, of Rogersville, Tenn., was sentenced to serve 37 months in prison, followed by one year of supervised release. Dykes pleaded guilty in January 2013 to conspiracy to distribute and to possess with the intent to distribute 55 kilograms or more of marijuana and a conspiracy to distribute and possess with intent to distribute oxycodone.
On Apr. 30, 2013, Jeremy R. Light, of Rogersville, Tenn., was sentenced to serve 57 months imprisonment, followed by three years of supervised release. Light pled guilty on January 3, 2013 to conspiracy to distribute and possess with intent to distribute oxycodone.
On Apr. 30, 2013, Michael B. Dykes, of Rogersville, Tenn., was sentenced to 30 months in prison, followed by three years of supervised release. Dykes pleaded guilty in January 2013 conspiracy to distribute and possess with intent to distribute oxycodone.
On Jul. 23, 2013, Jackie D. Dykes, of Rogersville, Tenn., was sentenced to serve 80 months in prison, followed by three years of supervised release. Dykes pleaded guilty in December 2012 conspiracy to distribute and to possess with the intent to distribute 55 kilograms or more of marijuana and a conspiracy to distribute and possess with intent to distribute oxycodone.
On Aug. 5, 2013, James H. McMurray, Jr., of Blountville, Tenn., was sentenced to serve 60 months in prison, followed by four years of supervised release. McMurray pleaded guilty in April 2013 to conspiracy to distribute and to possess with the intent to distribute 100 kilograms or more of marijuana and money laundering.
On Aug. 5, 2013, Michael Lee Lawson, of Rogersville, Tenn., was sentenced to serve 70 months in prison, followed by four years of supervised release. Lawson pleaded guilty in April 2013 to conspiracy to distribute and to possess with the intent to distribute 100 kilograms or more of marijuana.
On Oct. 16, 2013, Parrie Christine Hudgins, of Kingsport, Tenn., was sentenced to serve 87 months in prison, followed by five years of supervised release. Lawson pleaded guilty in April 2013 to conspiracy to distribute and to possess with the intent to distribute 1,000 kilograms or more of marijuana and a conspiracy to distribute and possess with intent to distribute oxycodone.
The indictment and subsequent conviction of Light and other co-conspirators was the result of a three year investigation conducted by the Hawkins County Tennessee Sheriff’s Department, Sullivan County Tennessee Sheriff’s Department, Greene County Tennessee Sheriff’s Department, Second Judicial Drug Task Force, Kingsport, Tennessee, Police Department, Third Judicial Drug Task Force, Tennessee Bureau of Investigation, Federal Bureau of Investigation, Social Security Administration, and Drug Enforcement Administration. Assistant U.S. Attorney Caryn L. Hebets represented the United States.
Queens, N.Y., Men Plead Guilty to Large-Scale ATM Skimming Scheme Targeting New Jersey Bank CustomersRead the Press Release
NEWARK, N.J. – Two Romanian natives residing in Queens, N.Y., today admitted to a scheme to steal account information from bank customers throughout New York, New Jersey, and Connecticut by installing secret card-reading devices on ATMs, U.S. Attorney Paul J. Fishman announced.
Ioan Leusca, a/k/a “Ionel Spinu,” 30, and Dezso Gyapias, a/k/a “Valentin Folea,” 29, each pleaded guilty before U.S. District Judge William J. Martini to separate informations charging each with one count of conspiracy to commit bank fraud and one count of aggravated identity theft. Leusca and Gyapias have been held without bail since their arrests on Jan. 13, 2013.
According to documents filed these and other cases and statements made in court:
Leusca and Gyapias admitted that they and their fellow conspirators installed skimmers and pinhole cameras at bank ATMs. The devices were installed on multiple ATMs in New Jersey and Connecticut. Each skimmer, an electronic device, would read and record identity and account information contained in the magnetic strip of a customer’s ATM card. The pinhole camera secretly recorded bank customers’ keystrokes as they entered their personal identification numbers. Leusca and Gyapias admitted that they and other conspirators went back to collect the devices containing the recorded information.
Leusca and Gyapias acknowledged that after the stolen customer account and identification information had been loaded onto blank ATM cards, they and their conspirators used those cards to steal $985,000 from Citibank ATMs in New Jersey, New York and Connecticut.
The charges to which Leusca and Gyapias pleaded guilty arose from a larger investigation into a skimming scheme that targeted customers in the tri-state area in 2012 and early 2013. Together, the schemes cost a number of banks a total of $5 million in cash stolen from their customer accounts.
Of the eight others charged in relation to the wider scheme, all Romanian nationals who lived in Queens, seven are in custody. The leaders of the scheme, Marius Vintila, 31, and Bogdan Radu, 30, were charged by criminal complaint on July 10, 2013. Vintila and Radu designed and created the actual skimming devices and pinhole cameras and recruited individuals, including Leusca and Gyapias, to install them on bank ATMs. Vintila used an alias to rent multiple self-storage units, in which he stored the contents of an entire skimming operation, including skimming devices, pinhole cameras, super glue, tape, SD cards, batteries, computers, molds, fraudulent ATM cards, and cash proceeds. Radu taught co-conspirators how to install the skimming devices, and Radu used an alias to move skimming devices and cash proceeds overseas.
Other charged conspirators, including Constantin Ginga, 53, Marius Cotiga, 35, Constantin Pendus, 30, Emil Revesz, 30, Florin Apetrei, 18 and another individual charged as “first name unknown, last name unknown,” a/k/a “Chioru,” installed the devices designed by Vintila and Radu onto bank ATMs and used fraudulent ATM cards to steal millions of dollars. They used hats, jackets, scarves and sunglasses to disguise themselves while installing the devices and while using the cards to withdraw money.
Ginga, Cotiga, Leusca, Gyapias, Pendus, Revesz, Apetrei, and Radu are in custody in New Jersey and being held without bail. Ginga previously pleaded guilty to conspiring to commit bank fraud and aggravated identity theft and awaits sentencing on Dec. 18, 2013. On Sept. 24, 2013, Vintila was apprehended in Sweden and awaits extradition to the United States. The individual known as “Chioru” remains at large.
The bank fraud conspiracy charge to which Leusca and Gyapias pleaded guilty is punishable by a maximum potential penalty of 30 years in prison and a $1 million fine. The aggravated identity theft charge carries a mandatory, consecutive penalty of two years in prison and a maximum $250,000 fine. Sentencing is currently scheduled for Feb. 20, 2014.
U.S. Attorney Fishman praised special agents of the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge James Mottola, along with special agents of Immigration and Customs Enforcement, Homeland Security Investigations (HSI) in Newark, under the direction of Andrew M. McLees, with the investigation leading to today’s guilty pleas.
The charges and allegations against the other defendants charged in the pending complaints are merely accusations, and the defendants are considered innocent unless and until proven guilty.
The government is represented by Assistant U.S. Attorneys Rahul Agarwal and David Eskew of the U.S. Attorney’s Office Criminal Division in Newark.
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Defense Counsel:
Leusca: Frank Arleo Esq., West Orange, N.J.Gyapias: Joe Rotella Esq., Newark
Leusca, Ioan Information
Gyapias, Dezso InformationPueblo Man Found Guilty of Tax Evasion, Bank Fraud and Interfering with IRS LawsRead the Press Release
DENVER – Michael Destry Williams, age 49, of Pueblo, Colorado, was found guilty by a jury late yesterday for tax evasion, structuring, bank fraud, and interfering with IRS laws, the U.S. Attorney’s Office, Internal Revenue Service – Criminal Investigation Division (IRS CI) and Treasury Inspector General for Tax Administration (TIGTA) announced. The guilty verdict was the result of a 6 day trial before U.S. District Court Judge Christine M. Arguello. Williams remained in the custody of the United States Marshals and is scheduled to be sentenced on January 27, 2014 at 3:30 p.m.
Williams was indicted by federal grand jury in Denver on March 22, 2012, followed by a superseding indictment on July 26, 2012.According to the indictment, superseding indictment and evidence presented at trial, Williams was self-employed as a general contractor focusing primarily on residential construction projects, including roofing, remodeling and the repair and restoration of residential structures sustaining fire and water related damage. He was also self-employed as a real estate investor involved in the purchase, renovation and resale (commonly known, as “fixing and flipping”) of residential properties. Williams operated under the name of Greenview Construction, Inc., a Colorado corporation.
From April 2005 and continuing through January 2008, Williams willfully attempted to evade a substantial amount of income tax and self-employment tax due and owing by him to the United States for calendar years 2005, 2006 and 2007. He failed to file income tax returns and failed to pay to the IRS income tax and self-employment tax. To conceal his income, Williams established and used trusts as part of his tax evasion scheme and structured over $90,000 in deposited funds from July 2008 through September 2008.
In November of 2009, Williams attempted to defraud a Colorado financial institution by depositing worthless fabricated United States Treasury checks for his own benefit. There were two false treasury checks totaling $55,000 payable to Greenview Construction. In February of 2010, there was a third fabricated United States Treasury check in the amount of $250,000 that Williams tendered to the El Paso County Court to settle a criminal misdemeanor case for which he had been sentenced to a jail term.
From October 2008 through December 2010, Williams mailed numerous frivolous correspondences to the Secretary of the Treasury as well as various IRS offices in an attempt to obstruct and impede the administration of the internal revenue laws. The obstructive efforts included attempts by Williams to target State of Colorado judicial officers who had presided over three separate state cases in which Williams was named as a defendant. In particular, Williams sent IRS criminal referrals accusing one of these judicial officers and the Clerk of the El Paso County District Court with committing criminal tax and related offenses.
“This defendant attempted to hide his income from the IRS, a ploy that doesn’t work,” said U.S. Attorney John Walsh. “The agents who investigated this case and the trial team who prosecuted the defendant deserve recognition for their hard work and successful outcome.”
“It’s only a matter of time -- when you willfully conceal income and interfere with IRS laws to this degree -- you will be investigated and brought to justice,” said Stephen Boyd, Special Agent in Charge for IRS Criminal Investigation, Denver Field Office.
“Without the outstanding teamwork demonstrated by the IRS Criminal Investigation, the U.S. Attorney’s Office in the District of Colorado and the Treasury Inspector General for Tax Administration, this conviction would not have been possible,” said P. Cordale Lamb, Special Agent in Charge in TIGTA’s Denver Office. “The conviction sends a strong message: those individuals who attempt to interfere with or impede the administration of Internal Revenue laws will be investigated and will be held accountable in a court of law.”
Williams was charged and found guilty of three counts of tax evasion, one count of structuring, two counts of bank fraud, three counts of fictitious obligations and one count of interfering with the administration of internal revenue laws. Tax evasion and structuring carries a penalty of not more than 5 years in federal prison, and a fine of up to $250,000 per count. Bank fraud carries a penalty of not more than 30 years in federal prison, and a fine of up to $1,000,000 per count. Fictitious obligations carries a penalty of not more than 25 years in federal prison, and a fine of up to $1,000,000 per count. Interfering with the administration of internal revenue laws carries a penalty of not more than 3 years in federal prison, and a fine of up to $250,000 per count.
This case was investigated by agents with IRS Criminal Investigation (IRS CI) and U.S. Treasury Inspector General for Tax Administration (TIGTA). The case is being prosecuted by Assistant U.S. Attorney Kenneth Harmon Department of Justice Tax Division Trial Attorney Kevin Sweeney.
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Prison inmate sentenced to five and a half years in prison for filing false tax refund claims and aggravated identity theftRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage man was sentenced today in federal court after being found guilty of conspiracy to defraud the government and aggravated identity theft.
Paulando Ramone Williams, 48, of Anchorage, Alaska, was sentenced today to five and half years in prison by Chief U.S. District Court Judge Ralph R. Beistline. Williams received a sentence of 42 months for conspiracy to defraud the government with respect to false refund claims and mail fraud and a consecutive sentence of 24 months for aggravated identity theft to be followed by three years of supervised release. Williams had pled guilty in August 2013. In addition to his prison sentence, a money judgment of $108,003 was entered against Williams. The Court also forfeited $23,160 seized from U.S. Bank in April 2011 and ordered Williams to pay restitution in the amount of $108,003.Assistant U.S. Attorney Yvonne Lamoureux, who prosecuted the case, noted that according to filings with the court, Williams participated in a conspiracy to obtain tax refunds by filing fraudulent income tax returns. Between April 2010 and January 2012, Williams and co-conspirators prepared and submitted to the IRS approximately 67 false tax returns claiming refunds of over $150,000.
Court documents also revealed that Williams and co-defendant Steve McComb, both prison inmates, obtained the names and social security numbers of individuals, many of whom were also inmates at correctional facilities to use in their scheme. Williams and McComb then provided that information to other co-conspirators to prepare and file false individual income tax returns. McComb authorized the co-conspirators to retain a portion of the money from the refunds, and directed them to wire or mail the remainder of the refunds to other co-conspirators or to hold the money for McComb. Recorded jail calls between the co-conspirators about the scheme included statements by McComb to another co-conspirator to make sure that Williams got his cut or portion of the proceeds.
Williams and co-conspirators Steve McComb, Helen Delores Maloney, and Michael Lee Sexton were indicted by a federal grand jury in February 2013 for conspiracy to defraud the government with respect to false claims, mail fraud, and aggravated identity theft. Their current status is as follows:
- McComb pled guilty to conspiracy to defraud the government with respect to claims, mail fraud, and aggravated identity theft in June 2013 and was sentenced to 9 years in prison on August 22, 2013;
- Maloney pled guilty to conspiracy to defraud the government with respect to claims and mail fraud in April 2013 and was sentenced to 28 months in prison on July 2, 2013; and
- Sexton has pled not guilty to the charges and is awaiting trial scheduled for December 9, 2013.
Ms. Loeffler commends the Internal Revenue Service, Criminal Investigation Division for conducting the investigation leading to the successful prosecution of Williams.
Porcupine Man Pleads Guilty to Child AbuseRead the Press Release
United States Attorney Brendan V. Johnson announced that Corey Good Crow, age 37, of Porcupine, South Dakota, appeared before U.S. Magistrate Judge Veronica L. Duffy on November 1, 2013, and pled guilty to Felony Child Abuse and Neglect.
The maximum penalty upon conviction is 10 years of imprisonment and a $250,000 fine.
The charge relates to Good Crow engaging in a pattern of conduct between 2008 and 2010 that subjected a child to abuse and neglect which caused the child severe and permanent psychological injury.
The investigation was conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. The case is being prosecuted by Assistant U.S. Attorney Wayne Venhuizen.
A presentence investigation was ordered and a sentencing date will be set. The defendant was remanded to the custody of the U.S. Marshals Service pending sentencing.
Pine Ridge Man Pleads Guilty to LarcenyRead the Press Release
United States Attorney Brendan V. Johnson announced that Michael Alford, age 31, of Pine Ridge, South Dakota, appeared before U.S. Magistrate Judge Veronica L. Duffy on October 31, 2013, and pled guilty to Larceny.
The maximum penalty upon conviction is 5 years of imprisonment and a $250,000 fine.
The charge relates to Alford and others stealing items from a house in Pine Ridge in the early morning hours of December 15, 2012. The items, valued at more than $1,000, included but were not limited to, an air compressor, tools, electronic devices, DVDs, games and jewelry.
The investigation was conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety.
A presentence investigation was ordered and a sentencing date will be set. The defendant was remanded to the custody of the U.S. Marshals Service pending sentencing.
Pine Ridge Man Pleads Guilty to Assault with A Dangerous WeaponRead the Press Release
United States Attorney Brendan V. Johnson announced that Michael Tobacco, age 21, of Pine Ridge, South Dakota, appeared before U.S. Magistrate Judge Veronica L. Duffy on October 31, 2013, and pled guilty to Assault with a Dangerous Weapon.
The maximum penalty upon conviction is 10 years of imprisonment and a $250,000 fine.
The charge relates to Tobacco assaulting a juvenile female at Pine Ridge on June 15, 2013. This assault resulted in the female receiving a severely bruised eye that was swollen shut and numerous bruises all over her upper body.
The investigation was conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. The case is being prosecuted by Assistant U.S. Attorney Eric Kelderman.
A presentence investigation was ordered. The defendant was remanded to the custody of the U.S. Marshals Service pending sentencing.
Pierre Woman Sentenced for Theft from an Indian Tribal OrganizationRead the Press Release
United States Attorney Brendan V. Johnson announced that a Pierre, South Dakota, woman convicted of Theft From an Indian Tribal Organization was sentenced on October 29, 2013, by U.S. District Judge Roberto A. Lange.
Ravae Bowman, age 40, was sentenced to 3 years of probation with 6 months of home confinement, $5,183.07 in restitution, and a $100 special assessment to the Federal Crime Victims Fund.
In October 2012, Bowman embezzled money from a Subway store in Eagle Butte where she was the manager. At the time, the Subway store was an entity of the Cheyenne River Sioux Tribe Telephone Authority and the Cheyenne River Sioux Tribe.
The Federal Bureau of Investigation conducted the investigation. The case was prosecuted by Assistant U.S. Attorney Mikal Hanson.
Patient Broker of South Florida Psychiatric Hospital Sentenced for Role in $67 Million Health Care Fraud SchemeRead the Press Release
A patient broker of a South Florida psychiatric hospital was sentenced today to serve 24 months in prison followed by three years of supervised release for her participation in a $67 million Medicare fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office, and Special Agent in Charge Christopher Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations’ Miami Office made the announcement.
Gloria Himmons, 54, of Union Springs, Ala., was sentenced by U.S. District Judge Jose E. Martinez in the Southern District of Florida. In March 2013, Himmons pleaded guilty to one count of conspiracy to receive health care kickbacks and one count of receiving a health care kickback. In addition to her prison term, Himmons was ordered to pay $14 million in restitution, joint and severally with her co-defendants.
According to court documents, Himmons was a patient broker at Hollywood Pavilion LLC (HP), a state-licensed psychiatric hospital in South Florida that purported to offer both inpatient and outpatient mental health services. Himmons would provide Medicare beneficiaries to HP in exchange for bribes and kickbacks, and she knew that the patients she provided to HP were not appropriate for inpatient psychiatric hospitalization or for outpatient mental health treatment. The patients she provided to HP included those who were not severely mentally ill, as well as substance abusers looking for rehabilitation programs. The patients did not have legitimate referrals from hospitals or doctors who had been treating acute-phase, severe mental illness.
From at least 2005 through September 2012, in exchange for bribes and kickbacks, Himmons knowingly and willfully provided to HP Medicare beneficiaries who did not need inpatient or outpatient psychiatric treatment. As a result of Himmons’s participation in this scheme, HP was improperly paid more than $7 million by Medicare. From at least 2003 through at least August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks. Medicare reimbursed HP on approximately $40 million of those claims.
On Sept. 10, 2013, co-defendants Karen Kallen-Zury, Daisy Miller and Christian Coloma were sentenced on their June 2013 jury convictions. Kallen-Zury, the chief executive officer of HP, and Miller and Coloma were convicted on all counts at trial and sentenced to 300 months, 180 months and 144 months, respectively. Kallen-Zury and Miller were ordered to pay, jointly and severally with their co-defendants, nearly $40 million in restitution. Coloma was ordered to pay, jointly and severally, more than $20 million in restitution.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Miami. This case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Andrew H. Warren and Anne McNamara of the Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.Patient Broker of South Florida Psychiatric Hospital Sentenced for Role in $67 Million Health Care Fraud SchemeRead the Press Release
A patient broker of a South Florida psychiatric hospital was sentenced today to serve 24 months in prison followed by three years of supervised release for her participation in a $67 million Medicare fraud scheme.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office, and Special Agent in Charge Christopher Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations’ Miami Office made the announcement.
Gloria Himmons, 54, of Union Springs, Ala., was sentenced by U.S. District Judge Jose E. Martinez in the Southern District of Florida. In March 2013, Himmons pleaded guilty to one count of conspiracy to receive health care kickbacks and one count of receiving a health care kickback. In addition to her prison term, Himmons was ordered to pay $14 million in restitution, joint and severally with her co-defendants.
According to court documents, Himmons was a patient broker at Hollywood Pavilion LLC (HP), a state-licensed psychiatric hospital in South Florida that purported to offer both inpatient and outpatient mental health services. Himmons would provide Medicare beneficiaries to HP in exchange for bribes and kickbacks, and she knew that the patients she provided to HP were not appropriate for inpatient psychiatric hospitalization or for outpatient mental health treatment. The patients she provided to HP included those who were not severely mentally ill, as well as substance abusers looking for rehabilitation programs. The patients did not have legitimate referrals from hospitals or doctors who had been treating acute-phase, severe mental illness.
From at least 2005 through September 2012, in exchange for bribes and kickbacks, Himmons knowingly and willfully provided to HP Medicare beneficiaries who did not need inpatient or outpatient psychiatric treatment. As a result of Himmons’s participation in this scheme, HP was improperly paid more than $7 million by Medicare. From at least 2003 through at least August 2012, HP billed Medicare approximately $67 million for services that were not properly rendered, for patients that did not qualify for the services being billed, and for claims for patients who were procured through bribes and kickbacks. Medicare reimbursed HP on approximately $40 million of those claims.
On Sept. 10, 2013, co-defendants Karen Kallen-Zury, Daisy Miller and Christian Coloma were sentenced on their June 2013 jury convictions. Kallen-Zury, the chief executive officer of HP, and Miller and Coloma were convicted on all counts at trial and sentenced to 300 months, 180 months and 144 months, respectively. Kallen-Zury and Miller were ordered to pay, jointly and severally with their co-defendants, nearly $40 million in restitution. Coloma was ordered to pay, jointly and severally, more than $20 million in restitution.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Miami. This case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Andrew H. Warren and Anne McNamara of the Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,500 defendants who collectively have falsely billed the Medicare program for more than $5 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Painting Contractor Admits Paying $800k in Bribes to West Haven Housing Authority OfficialRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that HARRY P. MICONI, 77, of West Haven, waived his right to indictment and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to paying hundreds of thousands of dollars in bribes to a senior official at the West Haven Housing Authority.
According to court documents and statements made in court, MICONI owned and operated several painting and contracting businesses in West Haven, including P and K Contractor LLC. In pleading guilty, MICONI admitted that, between January 2007 and February 2012, he and his business made more than $800,000 in corrupt payments to a senior official at the West Haven Housing Authority, and to Four Star Development Company LLC, an entity personally owned and controlled by the official. In return, the official directed millions of dollars in business for or with the West Haven Housing Authority and its two affiliated instrumentalities, Meadow Landing and Spring Heights, to MICONI and his businesses.
MICONI pleaded guilty to one count of conspiracy to commit bribery in connection with a program receiving federal funds, which carries a maximum term of imprisonment of five years. Judge Shea has scheduled sentencing for January 29, 2014.
As part of his plea, MICONI has agreed to pay $862,563 in restitution.
Acting U.S. Attorney Daly stated that the investigation is ongoing.
This matter is being investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General, Federal Bureau of Investigation, and Internal Revenue Service – Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorneys David T. Huang and Susan L. Wines.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Owner of San Francisco Construction Company Pleads Guilty to Tax FraudRead the Press Release
SAN FRANCISCO – Brian Kenny pleaded guilty yesterday to one count of aiding and assisting in the preparation and presentation of a false U.S. Income Tax Return, United States Attorney Melinda Haag and Internal Revenue Service, Criminal Investigation Special Agent in Charge José M. Martinez announced.
According to the plea agreement, Kenny, 40, of San Francisco, incorporated his business, SF Bay Construction, Inc. on or about February 17, 2005. SF Bay Construction is a subchapter “S” corporation, located in San Francisco, Calif. Kenny has been the sole shareholder of SF Bay Construction from its incorporation through at least December 31, 2007. Kenny admitted that during the 2006 tax year, SF Bay Construction performed a variety of construction-related jobs for clients and received $1,309,833.77 in business income from those jobs. Kenny knew the amount of business gross receipts reported on SF Bay Construction’s income tax returns was material to the calculation of income tax owed on his personal income tax return because he was required to pay tax on SF Bay Construction’s business income. Kenny knew that his tax return preparer filed a 2006 federal income tax return that failed to report more than $470,000 in gross receipts and instead contained the false business income figure that Kenny had provided to the tax preparer.
Kenny was charged on July 25, 2013, with six counts of assisting in the filing of false tax returns. He pleaded guilty to one count. Sentencing is scheduled for February 11, 2014, at 2:00 p.m., before The Honorable William H. Alsup, U.S. District Court Judge, in San Francisco. The maximum statutory penalty for each count of aiding and assisting in the preparation and presentation of a false U.S. income tax return, in violation of Title 26, U.S.C. § 7206(2), is three years in prison and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Cynthia Stier is the Assistant United States Attorney who is prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
(Kenny indictment )
Oakland Man Sentenced to Seventeen Years in Prison for Conspiracy to Rob A Stash House Using Loaded FirearmsRead the Press Release
OAKLAND – George Branch was sentenced today to 204 months in prison, for conspiring to possess with intent to distribute 5 kilograms or more of cocaine; conspiring to commit robbery affecting interstate commerce; and possessing a firearm during and in relation to and in furtherance of a crime of violence and drug trafficking crime, United States Attorney Melinda Haag and Bureau of Alcohol, Tobacco, Firearms and Explosives, Special Agent in Charge Joseph M. Riehl announced.
Mr. Branch, 36, of Oakland, pleaded guilty to all three charges on July 10, 2013. During his change of plea hearing, evidence showed that Mr. Branch, and two co-conspirators, planned to rob a stash house containing over 5 kilograms of cocaine using loaded firearms. Evidence further showed that on several occasions Mr. Branch met with an undercover agent from the Bureau of Alcohol, Tobacco, Firearms, and Explosives to discuss the plans for the upcoming armed robbery.
“This sentence should serve to deter those who would seek to use firearms during robberies in Oakland or elsewhere. We thank the ATF and the Oakland Police Department for their investigation and dedication to battling gun violence through Operation Gideon," said U.S. Attorney Melinda Haag.
“Armed robbery crews prey on the neighborhoods in which they operate, and they instill fear through intimidation and violence,” said Bureau of Alcohol, Tobacco, Firearms and Explosives, Special Agent in Charge Joseph M. Riehl. “ATF’s priority is to combat violent criminals and by partnering with the Oakland Police Department we are successfully targeting, disarming, and removing them from our communities.”
The sentence was handed down by The Honorable Phyllis J. Hamilton, U.S. District Court Judge in Oakland. Judge Hamilton also sentenced the defendant to a ten-year period of supervised release. The defendant is already in custody and will begin serving the sentence immediately.
Natalie Lee and William Frentzen are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Daniel Charlier-Smith.
(Branch indictment )
Newark, N.J., Corrections Officer Faces Indictment Charging Sexual Abuse of DetaineeRead the Press Release
NEWARK, N.J. – A corrections officer with the Essex County Correctional Facility is expected to appear in court this afternoon for allegedly sexually assaulting a pretrial detainee in the facility and then lying about it to investigators, U.S. Attorney Paul J. Fishman announced.
Shawn D. Shaw, 40, of Newark, was charged by indictment with depriving an individual of rights under color of law and with obstruction of justice. The indictment was unsealed upon Shaw’s arrest on Oct. 8, 2013. He appeared that day before U.S. Magistrate Judge Madeline Cox Arleo and was released on a $100,000 bond with home detention. Shaw has been suspended from his duties since his arrest. His arraignment is scheduled for this afternoon before U.S. District Judge Faith S. Hochberg in Newark federal court.
According to the indictment:
On Dec. 28, 2010, Shaw, while acting in his official capacity as a corrections officer, subjected a detainee in the custody of the Essex County Correctional Facility to aggravated sexual abuse that caused bodily injury to the victim.
When investigators questioned Shaw about the attack, he lied and intentionally omitted information from his statement in order to obstruct the investigation. Specifically, Shaw falsely stated that he did not make sexual comments to the detainee or enter the victim’s cell.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to the arrest. He also thanked the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Carolyn A. Murray, with providing valuable information.
The charge of deprivation of rights under color of law carries a maximum potential penalty of life in prison. The obstruction of justice count carries a maximum potential penalty of 20 years in prison. Each count also carries a maximum $250,000 fine.
The government is represented by Criminal Division Chief Thomas Eicher and Assistant U.S. Attorney Shana Chen of the U.S. Attorney’s Office in Newark, and Trial Attorney Shan Patel of the Justice Department’s Civil Rights Division.
The charges and allegations contained in the indictment are merely accusations and the defendant is considered innocent unless and until proven guilty.
13-429
Defense counsel: Anthony C. Mack Esq., Newark
Shaw Indictment
New Jersey Man Convicted of Distribution of Child Pornography Involving Oakland TeenagerRead the Press Release
OAKLAND – Alex Gonzalez pleaded guilty in federal court today to distribution and possession of child pornography, United States Attorney Melinda Haag announced.
In pleading guilty, Gonzalez, 21, of Wenonah, New Jersey, admitted to meeting the victim, a 15-year old high school student, through the internet. The victim resided in Oakland. According to the statements made in court, Gonzalez instructed the victim to take nude photos of herself and to send them to him. He also instructed her to engage in sexually explicit conduct while on internet video chats. Gonzalez secretly recorded these encounters. When the 15-year old high school student stopped communicating with him, Gonzalez created a false identity on a social media website and uploaded the victim’s nude images to the social media website for the specific purpose of distributing those nude images to the high school student’s classmates.
Gonzalez was charged by Indictment on February 21, 2013, with one count of distribution of child pornography and one count of possession of child pornography. He pleaded guilty to all counts. Gonzalez’ sentencing is scheduled for February 19, 2014, before The Honorable Phyllis J. Hamilton, United States District Court Judge, in Oakland. The maximum statutory penalty for distribution of child pornography in violation of 18 U.S.C. § 2252(a)(4)(B) is 40 years’ imprisonment with a mandatory minimum sentence of 5 years and a fine of $250,000. Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Rodney C. Villazor is the Assistant U.S. Attorney who is prosecuting the case with the assistance of legal assistant Vanessa Quant. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
(Gonzalez indictment )
New Haven Man Sentenced to 50 Months in Federal Prison for Distributing Crack Cocaine, MarijuanaRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that ANTWAIN YOPP, 31, of New Haven, was sentenced today by Senior U.S. District Judge Ellen Bree Burns in New Haven to 50 months of imprisonment, followed by three years of supervised release, for distributing crack cocaine and marijuana.
YOPP is one of more than 100 individuals charged as a result of “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven. Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms.
The investigation revealed that YOPP conspired with others to distribute cocaine base and marijuana.
YOPP’s criminal history includes multiple convictions in state court, including convictions for sale of narcotics, possession with intent to sell narcotics, escape in the first degree and engaging police in pursuit. He was incarcerated in state custody on an unrelated offense when he was charged by federal indictment in May 2012.
On July 10, 2013, YOPP pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, cocaine base (“crack”) and marijuana. He has been detained in federal custody since August 26, 2013, when he completed his state sentence.
This matter is being investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments. The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments have provided valuable assistance to the investigation.
This case is being prosecuted by Assistant United States Attorneys S. Dave Vatti and Marc Silverman.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Navy Commander Charged with Accepting $100,000 Cash and Prostitutes in Widening International Bribery SchemeRead the Press Release
A third senior U.S. Navy official has been charged in a complaint unsealed today with accepting prostitutes, luxury travel and $100,000 cash from a foreign defense contractor in exchange for classified and internal U.S. Navy information, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Laura E. Duffy of the Southern District of California.
U.S. Navy Commander Jose Luis Sanchez, 41, was arrested in Tampa, Fla., this morning and made his initial appearance in federal court in the Middle District of Florida this afternoon. Also named in a complaint unsealed today is Leonard Glenn Francis, 49, of Malaysia, the CEO of Glenn Defense Marine Asia (GDMA), who was arrested on Sept. 16, 2013, in San Diego.
Two other senior Navy officials – Commander Michael Vannak Khem Misiewicz, 46, and Naval Criminal Investigative Service Supervisory Special Agent John Bertrand Beliveau II, 44 – have been charged separately in connection with bribery allegations. GDMA executive Alex Wisidagama, 40, of Singapore, has also been charged with participating in a related scheme to overbill the Navy for services provided in ports throughout Southeast Asia.
“As described in the corruption charges unsealed today, senior officials with the United States Navy abused their trusted positions as leaders in our armed forces by peddling favorable treatment -- and even classified government information -- for their personal benefit,” said Acting Assistant Attorney General Raman. “In turn, the GDMA executives who illicitly sought information and favors from those Navy officials boasted about their unlawful access to those officials and then traded on the influence that they illegally bought. Day by day, this massive Navy fraud and bribery investigation continues to widen, and as the charges announced today show, we will follow the evidence wherever it takes us.”
“According to the allegations in this case, a number of officials were willing to sacrifice their integrity and millions of taxpayer dollars for personal gratification,” said U.S. Attorney Laura Duffy. “While the overwhelming majority of the 400,000 active duty Navy personnel conduct themselves in a manner that is beyond reproach, we and our law enforcement partners at Naval Criminal Investigative Service and Defense Criminal Investigative Service continue to investigate the allegations of fraud and corruption that tarnish the stellar reputation of the U.S. Navy.”
“The arrest and criminal complaint against Commander Sanchez is the result of an ongoing investigation by the Defense Criminal Investigative Service and its law enforcement partners to identify and prosecute those individuals who would abuse their positions of trust within the Department of Defense,” said Special Agent In Charge Chris D. Hendrickson of the Office of the Inspector General, Department of Defense, Defense Criminal Investigative Service Western Field Office. “Allegations like these against Commander Sanchez can tarnish the reputation of honest and hardworking government personnel and put military personnel defending our nation around the globe at risk. The mission of DCIS is to ‘Protect America’s Warfighters’ and we will continue to relentlessly identify and investigate those individuals seeking to enrich themselves at the expense of the U.S. taxpayers.”
According to the complaint, Sanchez received bribes in return for sending sensitive U.S. Navy information to Francis, and making recommendations within the Navy to benefit Francis’s company, GDMA. GDMA is a multinational corporation and longtime government contractor based in Singapore, which provides hundreds of millions of dollars of “husbanding” services for the U.S. Navy in at least a dozen countries throughout the Pacific. Husbanding involves supplying food, water, fuel, tugboats and fenders, security, transportation, trash and liquid waste removal, and other goods and services to ships and submarines in foreign ports.
Like Sanchez, Misiewicz is accused of providing sensitive Navy information to Francis and secretly working on behalf of GDMA in exchange for prostitutes and luxury travel. GDMA, which has operating locations in Japan, Singapore, Thailand, Malaysia, Korea, India, Hong Kong, Indonesia, Australia, Philippines, Sri Lanka and the United States, allegedly overcharged the Navy and submitted bogus invoices for millions of dollars in services. Beliveau, the NCIS agent, is charged in another complaint with illegally supplying Francis with sensitive information, including reports of investigations by NCIS into possible frauds committed by GDMA in billing the U.S. Navy under its contracts. Wisidagama is charged with conspiracy to defraud the United States related to the overbilling.
According to court records, Sanchez allegedly provided Francis with internal Navy information, such as U.S. Navy ship schedules – some of which were classified – and information about husbanding issues that could affect GDMA, in order to help GDMA win and maintain Navy business. Court records allege that Sanchez regularly emailed Francis internal Navy discussions about GDMA, including legal opinions, and made recommendations in GDMA’s favor about port visits and Navy personnel assignments. In return, Francis gave Sanchez over $100,000 in cash, together with travel expenses and prostitutes. Court records allege that the conspiracy started in January 2009, when Sanchez was the Deputy Logistics Officer for the Commander of the U.S. Navy Seventh Fleet in Yokosuka, Japan, and continued when he was transferred to serve as Director of Operations for Fleet Logistics Command in Singapore, until he transferred to Florida in April 2013.
Sanchez and Francis allegedly communicated regularly via email and Facebook. Sanchez referred to Francis as “Lion King” and “Boss” in the emails, while Francis called Sanchez “brudda.”
For his part, Francis allegedly hired female escorts for Sanchez and friends on multiple occasions, on one occasion emailing one escort: “Hey Love Jose is in Manila at the DIAMOND Hotel go and see him he needs some love asap.”
According to court records, in an email exchange on Oct. 16, 2009, Sanchez and Francis allegedly discussed a trip Sanchez planned to take to Kuala Lumpur and Singapore with Navy friends he called his “Wolf Pack.” They discussed the number of rooms the “Wolf Pack” needed, and Sanchez asked Francis for pictures of prostitutes for “motivation.” Francis replied: “J, got it we will hook up after the FLAG dinner, will arrange a nest for you guys and some birds [women].” A few days later, on Oct. 19, 2009, Sanchez sent a Facebook message to Francis saying, “Yummy . . . daddy like.” In an Oct. 23, 2009, Facebook message, Sanchez asked Francis, “Where r we staying in KL [Kuala Lumpur]? No pictures to get our spirits up?”
Between Aug. 26 and 28, 2011, Francis allegedly communicated through email to the address of an escort whom Francis had previously hired for Sanchez. Francis wrote: “Hey Love, Jose is in Manila at the Diamond Hotel go and see him he needs some love asap room.” The escort responded to Francis, “Papi, I'm here jose's fon is not answering. I'm here [h]aving dri[n]ks at the lobby. Call him:: (( maybe his sleeping?” Later that day, she emailed Francis, “I'm with h[i]m already heehhe.”
Court records alleges that Francis sent an email on Oct. 20, 2011, asking Sanchez to help “swing” business his way regarding a U.S. Navy ship’s need to refuel at a port in Thailand. The Navy can use “sea cards” to purchase fuel for its ships at a price negotiated by the Defense Logistics Agency for Energy, as opposed to procuring fuel at usually higher prices from the husbanding contractor. In an email from Sanchez the next day, he told Francis: “Ask and you shall receive...we worked this out this morning…” According to court records, the USS Mustin did conduct a port visit to Laem Chabang, Thailand, during which it purchased fuel from GDMA, not via “sea cards.” As a result, the USS Mustin allegedly paid more than $1 million for fuel – more than twice what the fuel would have cost through use of the “sea card.”
The criminal complaint alleges that in an alleged Dec. 2, 2011, email discussion in which Sanchez told Francis about the status of an investigation of GDMA, Francis replied: “I have inside Intel from NCIS and read all the reports. I will show you a copy of a Classified Command File on me from NCIS ha ha.”
This ongoing investigation is being conducted by NCIS, the Defense Criminal Investigative Service, the Defense Contract Audit Agency, and the Drug Enforcement Administration. The Criminal Division’s Office of International Affairs provided significant assistance in this matter, and the Royal Thai Police and the Corrupt Practices Investigation Bureau Singapore also provided law enforcement assistance. This case is being prosecuted by Assistant U.S. Attorneys Mark Pletcher and Robert Huie of the Southern District of California, and Catherine Votaw, Director of Procurement Fraud, and Brian Young, Trial Attorney, of the Criminal Division’s Fraud Section.
The details contained in the criminal complaints are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Those with information relating to fraud, corruption or waste in government contracting should contact the NCIS anonymous tipline at www.ncis.navy.mil or call the Department of Defense Hotline at (800) 424-9098.
Navy Commander Charged with Accepting $100,000 Cash and Prostitutes in Widening International Bribery SchemeRead the Press Release
SAN DIEGO, CA - A third senior U.S. Navy official was charged in a complaint unsealed today with accepting prostitutes, luxury travel and $100,000 cash from a foreign defense contractor in exchange for classified and internal U.S. Navy information, announced U.S. Attorney Laura E. Duffy and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.
U.S. Navy Commander Jose Luis Sanchez, 41, was arrested in Tampa, Florida, this morning and made his initial appearance in federal court in the Middle District of Florida this afternoon. The United States will seek removal of Sanchez to San Diego to face charges. Also named in the complaint is Leonard Glenn Francis, 49, of Malaysia, the CEO of Glenn Defense Marine Asia (GDMA), who was arrested September 16, 2013, in San Diego.
Two other senior Navy officials – Commander Michael Vannak Khem Misiewicz, 46, and Naval Criminal Investigative Service Supervisory Special Agent John Bertrand Beliveau II, 44 – have been charged separately in connection with bribery allegations. GDMA executive Alex Wisidagama, 40, of Singapore, has also been charged with participating in a related scheme to overbill the Navy for services provided in ports throughout Southeast Asia.
“According to the allegations in this case, a number of officials were willing to sacrifice their integrity and millions of taxpayer dollars for personal gratification,” said U.S. Attorney Laura Duffy. “While the overwhelming majority of the 400,000 active duty Navy personnel conduct themselves in a manner that is beyond reproach, we and our law enforcement partners at Naval Criminal Investigative Service and Defense Criminal Investigative Service continue to investigate the allegations of fraud and corruption that tarnish the stellar reputation of the U.S. Navy.”
“As described in the corruption charges unsealed today, senior officials with the United States Navy abused their trusted positions as leaders in our armed forces by peddling favorable treatment -- and even classified government information -- for their personal benefit,” said Acting Assistant Attorney General Raman. “In turn, the GDMA executives who illicitly sought information and favors from those Navy officials boasted about their unlawful access to those officials and then traded on the influence that they illegally bought. Day by day, this massive Navy fraud and bribery investigation continues to widen, and as the charges announced today show, we will follow the evidence wherever it takes us.”
“The arrest and criminal complaint against Commander Sanchez is the result of an ongoing investigation by the Defense Criminal Investigative Service and its law enforcement partners to identify and prosecute those individuals who would abuse their positions of trust within the Department of Defense,” said Chris D. Hendrickson, Special Agent In Charge, Office of the Inspector General, Department of Defense, Defense Criminal Investigative Service Western Field Office. “Allegations like these against Commander Sanchez can tarnish the reputation of honest and hardworking government personnel and put military personnel defending our nation around the globe at risk. The mission of DCIS is to ‘Protect America’s Warfighters’ and we will continue to relentlessly identify and investigate those individuals seeking to enrich themselves at the expense of the U.S. taxpayers.”
According to the complaint, Sanchez received bribes in return for sending sensitive U.S. Navy information to Francis, and making recommendations within the Navy to benefit Francis’s company, GDMA. GDMA is a multinational corporation and longtime government contractor based in Singapore, which provides hundreds of millions of dollars of “husbanding” services for the U.S. Navy in at least a dozen countries throughout the Pacific. Husbanding involves supplying food, water, fuel, tugboats and fenders, security, transportation, trash and liquid waste removal, and other goods and services to ships and submarines in foreign ports.
Like Sanchez, Misiewicz is accused of providing sensitive Navy information to Francis and secretly working on behalf of GDMA in exchange for prostitutes and luxury travel. GDMA, which has operating locations in Japan, Singapore, Thailand, Malaysia, Korea, India, Hong Kong, Indonesia, Australia, Philippines, Sri Lanka and the United States, allegedly overcharged the Navy and submitted bogus invoices for millions of dollars in services, the complaint said. Beliveau, the NCIS agent, is charged in another complaint with illegally supplying Francis with sensitive information, including reports of investigations by NCIS into possible fraud committed by GDMA in billing the U.S. Navy under its contracts. Wisidagama is charged with conspiracy to defraud the United States related to the overbilling.
According to court records, Sanchez allegedly provided Francis with internal Navy information, such as U.S. Navy ship schedules – some of which were classified - and information about husbanding issues that could affect GDMA – some of which was classified – in order to help GDMA win and maintain Navy business.
Court records allege that Sanchez regularly emailed Francis internal Navy discussions about GDMA, including legal opinions, and made recommendations in GDMA’s favor about port visits and Navy personnel assignments. In return, Francis gave Sanchez over $100,000 in cash, together with travel expenses and prostitutes. Court records allege that the conspiracy started in January 2009, when Sanchez was the Deputy Logistics Officer for the Commander of the U.S. Navy Seventh Fleet in Yokosuka, Japan, and continued when he was transferred to serve as Director of Operations for Fleet Logistics Command in Singapore, until he transferred to Florida in April 2013.
Sanchez and Francis allegedly communicated regularly via email and Facebook. Sanchez referred to Francis as “Lion King” and “Boss” in the emails, while Francis called Sanchez “brudda.” For his part, Francis allegedly hired female escorts for Sanchez and friends on multiple occasions.
According to court records, in an email exchange on Oct. 16, 2009, Sanchez and Francis allegedly discussed a trip Sanchez planned to take to Kuala Lumpur and Singapore with Navy friends he called his “Wolf Pack.” They discussed the number of rooms the “Wolf Pack” needed, and Sanchez asked Francis for pictures of prostitutes for “motivation.” Francis replied: “J, got it we will hook up after the FLAG dinner, will arrange a nest for you guys and some birds [women].” A few days later, on Oct. 19, 2009, Sanchez sent a Facebook message to Francis saying, “Yummy . . . daddy like.” In an Oct. 23, 2009, Facebook message, Sanchez asked Francis, “Where r we staying in KL [Kuala Lumpur]? No pictures to get our spirits up?”
Between Aug. 26 and 28, 2011, Francis allegedly communicated through email to the address of an escort whom Francis had previously hired for Sanchez. Francis wrote: “Hey Love, Jose is in Manila at the Diamond Hotel go and see him he needs some love asap room.” The escort responded to Francis, “Papi, I'm here jose's fon is not answering. I'm here [h]aving dri[n]ks at the lobby. Call him:: (( maybe his sleeping?” Later that day, she emailed Francis, “I'm with h[i]m already heehhe.”
Court records allege that Francis sent an email on Oct. 20, 2011, asking Sanchez to help “swing” business his way regarding a U.S. Navy ship’s need to refuel at a port in Thailand. The Navy can use “sea cards” to purchase fuel for its ships at a price negotiated by the Defense Logistics Agency for Energy, as opposed to procuring fuel at usually higher prices from the husbanding contractor. In an email from Sanchez the next day, he told Francis: “Ask and you shall receive...we worked this out this morning…” According to court records, the USS Mustin did conduct a port visit to Laem Chabang, Thailand, during which it purchased fuel from GDMA, not via “sea cards.” As a result, the USS Mustin allegedly paid more than $1 million for fuel – more than twice what the fuel would have cost through use of the “sea card.”
The criminal complaint alleges that in an alleged Dec. 2, 2011, email discussion in which Sanchez told Francis about the status of an investigation of GDMA, Francis replied: “I have inside Intel from NCIS and read all the reports. I will show you a copy of a Classified Command File on me from NCIS ha ha.”
This ongoing investigation is being conducted by NCIS, the Defense Criminal Investigative Service and the Defense Contract Audit Agency. Significant assistance was provided by the Drug Enforcement Administration, Homeland Security Investigations, the DOJ Criminal Division’s Office of International Affairs, the Royal Thai Police and the Corrupt Practices Investigation Bureau Singapore. This case is being prosecuted by Assistant U.S. Attorneys Mark Pletcher and Robert Huie of the Southern District of California and Catherine Votaw, Director of Procurement Fraud for the Criminal Division’s Fraud Section and Brian Young, Trial Attorney, of the Criminal Division’s Fraud Section.
Those with information relating to fraud, corruption or waste in government contracting should contact the NCIS anonymous tipline at www.ncis.navy.mil, the DoD Hotline at www.dodig.mil/hotline or call (800) 424-9098.
DEFENDANTSCase Number: 13-MJ-4027
Leonard Glenn Francis
Jose Luis SanchezCase Number: 13-CR-3781
Leonard Glenn Francis
John Bertrand Beliveau II
Case Number: 13-CR-3782Leonard Glenn Francis
Michael Vannak Khem Misiewicz
Case Number: 13-MJ3783Alex Wisidagama
SUMMARY OF CHARGESCase Number: 13-MJ-4027
Conspiracy to Commit Bribery in violation of 18 U.S.C. § 371
Case Number: 13-CR-3781
Conspiracy to Commit Bribery in violation of 18 U.S.C. § 371
Case Number: 13-CR-3782
Conspiracy to Commit Bribery in violation of 18 U.S.C. § 371
Case Number: 13-MJ-3783
Conspiracy to Defraud the United States in violation of 18 U.S.C. § 371
INVESTIGATING AGENCIESDefense Criminal Investigative Service
Naval Criminal Investigative Service
Defense Contract Audit Agency*A complaint is not evidence that the defendants committed the crimes charged. The defendants are
presumed innocent until the Government meets its burden in court of proving guilt beyond a
reasonable doubt.Navajo Man Pleads Guilty to Brandishing a Firearm During a Home Invasion on the Navajo Indian ReservationRead the Press Release
ALBUQUERQUE – Donovan F. Muskett, 21, an enrolled member of the Navajo Nation who resides in Navajo, N.M., pleaded guilty this morning to brandishing a firearm during a crime of violence. Under the terms of his plea agreement, Muskett will be sentenced to seven years in federal prison followed by a term of supervised release to be determined by the court. Muskett’s guilty plea was announced by Acting U.S. Attorney Steven C. Yarbrough and Director John Billison of the Navajo Nation Division of Public Safety.
Muskett was arrested on March 1, 2013, based on a criminal complaint charging him with assault with a dangerous weapon, using a firearm during a crime of violence and aggravated burglary. He subsequently was indicted and charged with committing the following offenses in Navajo, N.M., on Feb. 10, 2013: (1) assault with a dangerous weapon; (2) aggravated burglary; (3) brandishing a firearm during a crime of violence; and (4) negligent child abuse.
According to court records, on Feb. 10, 2013, Muskett forced his way at gunpoint into a Navajo residence occupied by a woman and a young child. Muskett pointed his firearm at the adult victim, demanded money from her, and threatened to shoot her. While Muskett was rummaging in the kitchen, the victim managed to push Muskett out of the residence and lock him out. After ensuring the child victim’s safety, the adult victim called the police and reported the break-in and assault. Officers were able to locate Muskett by following footsteps in the snow. Muskett was arrested on tribal charges and remained in tribal custody until his arrest on federal charges.
During this morning’s proceedings, Muskett entered a guilty plea to Count 3 of a superseding indictment charging him with brandishing a firearm during a crime of violence. In his plea agreement, Muskett admitted brandishing a .22 caliber revolver while committing a crime of violence. More specifically, Muskett admitted pointing the firearm at the adult victim with the intention of committing the felony offenses of assault with a dangerous weapon and aggravated battery.
Muskett was remanded into federal custody after entering his guilty plea and will remain detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Window Rock office of the Navajo Division of Public Safety with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives and is being prosecuted by Assistant U.S. Attorneys Novaline D. Wilson and Kyle T. Nayback.
Minnesota Woman Sentenced for Failure to Pay Child Support and Failure to AppearRead the Press Release
United States Attorney Brendan V. Johnson announced that a Garden City, Minnesota, woman convicted of Failure to Pay Child Support and Failure to Appear was sentenced on November 4, 2013, by U.S. District Court Judge Charles B. Kornmann.
Jessica Lynn Voss, age 29, was sentenced to 5 years of unsupervised probation, a $100.00 special assessment to the Federal Crime Victims Fund, and child support restitution in the amount of $23,812.78 for failure to pay child support. In addition, she was sentenced to imprisonment of time served, 1 year of unsupervised probation, and a $100.00 special assessment to the Federal Crime Victims Fund for failure to appear.
Voss was indicted by a federal grand jury on October 10, 2012, for failing to pay over $19,000 in past due child support. She had been ordered by the Fifth Judicial Circuit Court, Roberts County, South Dakota, to pay $350.00 per month for her minor children, commencing December 1, 2007. At the time of indictment, she had not made a child support payment since August of 2009. After her initial appearance in federal court in South Dakota, she was released on bond.
Voss had a change of plea hearing scheduled for May 28, 2013. Through her attorney, the defendant conveyed that she was going to plead guilty. The defendant did not appear at her plea hearing and a warrant was issued for failure to appear. Voss pled guilty to the child support charge on August 5, 2013, and to the failure to appear charge on November 4, 2013.
This case was investigated by the Department of Health and Human Services, Office of Inspector General Assistant U.S. Attorney Thomas J. Wright prosecuted the case. The defendant was released from custody.Members of Illegal Drug Company Gallant Pharma Plead Guilty to Selling Misbranded DrugsRead the Press Release
ALEXANDRIA, Va. –Patricia Durr, 49, of Hopkinton, Massachusetts, and Lisa Coroniti, 46, of Philadelphia, Pennsylvania, both sales representatives for Gallant Pharma International Inc., headquartered in Arlington, Virginia, pleaded guilty today to selling misbranded Botox and other drugs.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; Antoinette V. Henry, Special Agent in Charge of the Food and Drug Administration’s (FDA) Office of Criminal Investigations; Gary Barksdale, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; Acting Special Agent in Charge Scot R. Rittenberg for U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Washington, D.C.; and M. Douglas Scott, Arlington Chief of Police, made the announcement after the pleas were accepted by United States District Judge Hilton.
Durr and Coroniti are the sixth and seventh members of Gallant Pharma, respectively, to enter guilty pleas:
- On October 3, 2013, sales representative Harvey Whitehead, 68, of Troy, Michigan, pleaded guilty to selling misbranded chemotherapy drugs and to engaging in unlicensed wholesale prescription drug distribution;
- On October 3, 2013, former sales representative Michael Merriam, 32, of Toronto, Canada, pleaded guilty to selling misbranded Botox;
- On October 8, 2013, Gallant Pharma office manager Robert Sparks, 30, of Springfield, Virginia, pleaded guilty to introducing misbranded drugs into interstate commerce;
- On October 15, 2013, Gallant Pharma co-founder and co-owner Talib Khan, 42, of Montreal, Canada and Barbados, pleaded guilty to selling misbranded chemotherapy and cosmetic drugs, and conspiracy to commit importation fraud, sell misbranded drugs, distribute prescription drugs without a license, and defraud the FDA; and
- On November 4, 2013, former Gallant Pharma office manager Tanya Smith, 40, of Springfield, Virginia, and Manassas, Virginia, pleaded guilty to introducing misbranded drugs into interstate commerce.
According to court documents, between October 2010 and August 2013, Durr sold more than $2.6 million in misbranded and non-FDA-approved intravenous chemotherapy drugs and injectable cosmetic drugs and devices (including tampered vials of Botox) to 33 doctors and medical practices in Massachusetts and Connecticut. Coroniti likewise admitted that, between June 2011 and August 2013, she sold more than $1.1 million in misbranded and non-FDA-approved intravenous chemotherapy drugs and injectable cosmetic drugs and devices to 15 doctors and medical practices in the greater Philadelphia, Pennsylvania, area.
Many of the drugs sold by Durr and Coroniti were required to contain a “black box” warning, the strongest warning issued by the FDA, which indicates that a drug has a significant risk of serious or life-threatening adverse effects. The versions sold by Gallant Pharma did not meet this or other FDA labeling requirements. Many of the drugs sold by Gallant Pharma were also subject to strict temperature controls and were required to be shipped in dry ice to protect the drug efficacy, which Gallant Pharma could not do.
Durr and Coroniti each face a maximum penalty of three years’ imprisonment when they are sentenced. Durr will be sentenced on February 28, 2014 and Coroniti on March 21, 2014. A jury trial is scheduled for January 6, 2014, for alleged Gallant Pharma co-founder and co-owner Syed “Farhan” Huda, 38, of Arlington, Virginia; his wife and alleged Gallant Pharma administrator Deeba Mallick, 36, of Arlington, Virginia; alleged supplier Mirwaiss Aminzada, 44, of Dubai, United Arab Emirates, and Montreal, Canada; and alleged drop-shipper and customer Anoushirvan Sarraf, 47, of Rockville, Maryland.
This case was investigated by FDA’s Office of Criminal Investigations, the Drug Enforcement Agency’s Group 33 Diversion Task Force, ICE, and the U.S. Postal Inspection Service, with assistance from the Arlington County Police Department. Assistant United States Attorneys Lindsay Kelly, Ryan Dickey, Jay Prabhu, and Maya Song are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Manhattan U.S. Attorney Announces Fraud Charges Against Provider of Services for Special Needs Preschool StudentsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Thomas P. DiNapoli, the New York State Comptroller, Richard Condon, the Special Commissioner of Investigation for New York City’s Department of Education, and Brian M. Hickey, the Special Agent-in-Charge of the Northeastern Region of the United States Department of Education’s Office of Inspector General (“ED-OIG”), announced today the arrest of CHEON PARK, owner and executive director of Bilingual SEIT, a federal, New York State, and New York City funded provider of special education services and preschool programs to New York City preschool children. PARK was arrested this afternoon and presented in Manhattan federal court before U.S. Magistrate Judge Ronald L. Ellis.
Manhattan U.S. Attorney Preet Bharara said: “Cheon Park allegedly orchestrated multiple schemes to enrich himself by taking funds intended for special needs children and diverting them into his own coffers. As today’s arrest makes clear, we will not tolerate individuals who cheat local, state, and federal government under the guise of helping children, and will do everything in our power to hold them accountable.”
New York State Comptroller Thomas P. DiNapoli said: “As alleged, Cheon Park blatantly ripped off taxpayers for hundreds of thousands of dollars, partly through kickbacks, to support his lavish lifestyle, even going as far as using the public’s money to clean his house. Our audits and investigations of special education providers have uncovered too much fraud and abuse that is depriving students with special needs of the resources intended for them. I urge the Governor to sign our bill that mandates an audit of every provider and give taxpayers assurance their money is being well-spent. I commend U.S. Attorney Preet Bharara for prosecuting Park and bringing abusers of the special education system to justice. I look forward to continuing this partnership.”
SCI Special Commissioner Richard J. Condon said: “As alleged, Park, through Bilingual SEIT, used a contract with the New York City Department of Education to misappropriate public funds for his own benefit. At the same time, Park allegedly deprived the neediest of preschool students of essential mandated services. This is one of a series of investigations that my office is conducting with the U.S. Attorney for the Southern District of New York.”
ED-OIG Special Agent-in-Charge Brian M. Hickey said: “Today’s arrest relates to allegations that Mr. Park not only knowingly and willfully abused his position of trust for personal gain, but did so at the expense of special needs students. That is completely unacceptable. Tracking down those who would cheat the children and families that rely on special education programs is a priority of our office.”
The following allegations are based on the Complaint unsealed today in Manhattan federal court:
Between 2005 and 2012, PARK engaged in a conspiracy to defraud the federal government, New York State, and New York City of millions of dollars by deliberately inflating both the amount of compensation Bilingual SEIT paid certain of its employees and contractors, and the type of work performed by certain employees on annual certified consolidated fiscal reports (“CFRs”) and financial statements submitted to the New York State Education Department (“NYSED”) and the New York City Department of Education (“NYCDOE”).
PARK owned and operated Bilingual SEIT from at least 2005 to 2012. During that time, Bilingual SEIT had a contract with the NYCDOE to provide publicly funded special education services and preschool programs to New York City schoolchildren aged three to five with physical, emotional, and/or developmental disabilities. Specifically, Bilingual SEIT received funding to provide: (1) special education itinerant teacher, commonly referred to as SEIT, services; (2) special education classes in a center-based setting for preschool students with special needs; (3) individual evaluations for preschool students with disabilities; and (4) physical, occupational, and/or speech therapy for preschool students who qualified for such services. As of September 2012, Bilingual SEIT operated out of five locations in Manhattan, Queens, and Brooklyn.
During the seven-year period that Bilingual SEIT was under contract with the NYCDOE, it claimed reimbursement for and received approximately $94.5 million in federal, New York State, and New York City funding to provide the services described above. In order to receive such money, on behalf of Bilingual SEIT, PARK was required to file a CFR supported by audited financial statements with the NYSED. The CFR and audited financial statements represented the costs that Bilingual SEIT had incurred the previous year and the justification for those costs, and included compensation Bilingual SEIT purported to pay its employees and contractors. Each year, PARK signed the certification pages for the CFRs filed with the NYSED, which relied on the CFR and audited financial statements in determining the amount of public funds to pay Bilingual SEIT per student for the services Bilingual SEIT provided to New York City preschool students.
Beginning in approximately June 2011, the New York State Comptroller’s office (the “Comptroller”) conducted an audit of Bilingual SEIT to determine whether the costs reported by Bilingual SEIT on the CFRs for the years July 2007 through 2009 were properly calculated, justified, and allowable under guidance issued by the NYSED. In July 2012, the Comptroller issued a report that concluded that nearly $1.5 million of the costs that PARK certified for the two-year audit period should have been disallowed, including money paid to 26 employees whose time and attendance could not be substantiated. As a result of the Comptroller’s report, the NYCDOE cancelled Bilingual SEIT’s classes and declined to renew its contract with Bilingual SEIT.
In fact, PARK engaged in several schemes designed to inflate the costs Bilingual SEIT represented it incurred, resulting in more public money for Bilingual SEIT, much of which, as set forth below, was kicked back to PARK.
Specifically, PARK engaged in three different fraudulent schemes. First, PARK fraudulently received funds from New York State and New York City to pay multiple individuals who performed little or no work for Bilingual SEIT. At PARK’s request and direction, these individuals then kicked back as much as 50% of the salary they fraudulently received from Bilingual SEIT to PARK. For example, PARK asked an individual who sporadically evaluated children for Bilingual SEIT (“Individual-3”) to accept payment from Bilingual SEIT in exchange for kicking back 50% of the payments to PARK. Individual-3 agreed, and kicked back approximately $3,500 a month in cash to PARK each month during the period between 2005 and 2008. During the Comptroller’s audit, PARK asked Individual-3 to sign various documents that falsely indicated that Individual-3 actually worked for Bilingual SEIT during the years 2007 through 2009.
Second, PARK fraudulently received funds from New York State and New York City to deliberately overpay other individuals who worked for Bilingual SEIT. At PARK’s request and direction, these individuals also kicked back a portion of the overpayment to PARK on a regular basis. For example, in 2006, PARK hired an individual as an office worker for Bilingual SEIT (“Individual-4”). Shortly after Individual-4 began working for Bilingual SEIT, PARK asked Individual-4 to kick back to PARK approximately $2,200 a month from Individual-4’s monthly salary. Individual-4 agreed to do so, and kicked-back approximately $2,200 a month to Park until Individual-4 stopped working for Bilingual SEIT in 2011.
Third, in addition to receiving kickbacks, PARK used Bilingual SEIT funds for his personal benefit in other ways. PARK arranged for Bilingual SEIT to pay his ex-wife and ex-sister-in-law for work they did not perform. According to various CFRs filed with the NYSED, PARK’s ex-wife served as Bilingual SEIT’s “Assistant Executive Director,” the second most senior executive at Bilingual SEIT. For the years 2006 through 2012, PARK’s ex-wife was one of the most highly compensated employees at Bilingual SEIT. According to witness interviews, as well as the audit performed by the Comptroller, PARK’s ex-wife did not function as the “Assistant Executive Director,” and, to the extent she performed any functions at all at Bilingual SEIT, she was an office worker. PARK also arranged to have Bilingual SEIT pay his ex-sister-in-law, who, according to witnesses, never worked at Bilingual SEIT. Finally, PARK also arranged for Bilingual SEIT to pay for tutoring for PARK’s children and for a Bilingual SEIT employee to clean PARK’s home twice a week.
PARK, 46, of Manhasset, New York, is charged with conspiracy to commit mail fraud, which carries a maximum term of 20 years in prison, and one count of mail fraud, which also carries a maximum term of 20 years in prison.
Mr. Bharara praised the investigative work of the Office of the State Comptroller, the Special Commissioner of Investigation for New York City’s Department of Education, the Office of Inspector General for the United States Department of Education. He also thanked the Queens County District Attorney’s Office for its assistance.
This case is being prosecuted by the Office’s Public Corruption Unit. Assistant United States Attorneys Paul Krieger, Rebecca Ricigliano, and Martin Bell are in charge of the prosecution.
The charges contained in the Complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Cheon Park Complaint 13Mag2624
Manhattan U.S. Attorney Announces $5 Million Settlment of Civil Forfeiture Claim Against Dutchess County Medical PracticeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that the United States has filed, and simultaneously settled, a civil forfeiture lawsuit against the assets of Mid Hudson Medical Group, P.C. (“MHMG”). The Government’s action alleges that MHMG received millions of dollars in proceeds from two schemes to defraud Medicare, the New York State Insurance Fund, and private health insurance providers (collectively, the “Health Insurance Providers”). The stipulation and order of settlement (the “Settlement”) requires MHMG to forfeit $5 million to the United States. The Government submitted the Settlement for approval this afternoon to U.S. District Judge Vincent L. Briccetti, who is presiding over the matter, captioned United States v. $5,000,000.00 in U.S. Currency, 13 Civ. 7898 (VB).
Manhattan U.S. Attorney Preet Bharara said: “The laws are clear and formidable when it comes to the bilking of health insurance providers: you cannot be permitted to keep and enjoy illicit proceeds of fraud. This Office and its partners will make every effort to intercept such activity wherever we find it.”
According to the Verified Complaint and other publicly filed documents:
Between at least 2006 and July 2011, Spyros Panos, an orthopedic surgeon and MHMG shareholder, engaged in an unlawful scheme to defraud Health Insurance Providers, in which Panos submitted, and caused MHMG to submit, fraudulent information to the Health Insurance Providers regarding the nature and details of surgical procedures he performed. As a result, the Health Insurance Providers paid MHMG millions of dollars more than MHMG was entitled to receive for the actual work that Panos did perform. On October 31, 2013, Panos pled guilty to one count of engaging in a scheme to commit health care fraud, in a criminal case captioned United States v. Spyros Panos, 13 Cr. 800 (NSR).
Additionally, from approximately 2009 through June 2012, certain employees of MHMG, who were responsible for submitting requests for pre-authorization/certification from certain Health Insurance Providers for Magnetic Resonance Imaging tests (“MRIs”), submitted requests to Health Insurance Providers in which the employees included details regarding patients’ history that the employees knew were necessary in order to obtain the approvals, but which the employees had no reason to know was or was not truthful, and which in at least some cases was not truthful. As a result, Health Insurance Providers paid MHMG more for MRI tests than MHMG was entitled to receive.
Under the terms of the Settlement, MHMG is awarded credits for reimbursements it has already made to certain Health Insurance Providers, and MHMG is required to transfer an additional $3.67 million to the United States pursuant to an agreed-upon schedule. The Settlement amount represents an estimate of the amount of proceeds MHMG obtained from Health Insurance Providers as a result of the alleged unlawful activity and is not a final determination by the Government as to the loss amounts incurred by all Health Insurance Providers, collectively or individually, as a result of the unlawful activity.
Mr. Bharara praised the work of the United States Postal Inspection Service, the United States Department of Health and Human Services – Office of Inspector General, and the Federal Bureau of Investigation, and thanked the United States Department of Health and Human Services, Office of Counsel to the Inspector General and Office of General Counsel, the New York State Insurance Fund, and the New York Workers’ Compensation Board Office of the Fraud Inspector General for their assistance.
This case is being handled by the White Plains Division. Assistant United States Attorneys Lee Renzin and Daniel Filor are in charge of the case.
MHMG Forfeiture Stip Settlement.Filed
MHMG Forfeiture Complaint.FiledLutz, Fla., Man Convicted on Drug Distribution and Sex Trafficking ChargesRead the Press Release
Acting U.S. Attorney A. Lee Bentley III and Acting Assistant Attorney General Jocelyn Samuels of the Civil Rights Division today announced the conviction of Andrew Blane Fields, 62, of Lutz, Fla., in the Middle District of Florida on charges of possession with intent to distribute controlled substances, namely Oxycodone, Dilaudid and Morphine, and sex trafficking by force, fraud and coercion. Fields faces a mandatory minimum of 15 years in prison and a statutory maximum of life in prison on each of the five sex trafficking convictions.
In a superseding indictment returned Aug. 22, 2013, a federal grand jury charged Fields with engaging in a sex trafficking scheme whereby he controlled his victims by supplying them with highly addictive controlled substances and by using their fear of withdrawal symptoms to force them into prostitution for his profit. At trial, the government presented evidence that the defendant recruited vulnerable young women who were engaging in prostitution or performing at strip clubs and then rapidly escalated their drug use into full-blown addiction. Other evidence included the testimony of five victims of the defendant’s scheme, quantities of narcotics seized from the defendant’s possession and images of the defendant surreptitiously distributing narcotics to a hospitalized victim.
During the execution of a federal search warrant, law enforcement officers recovered thousands of prescription pills from Fields' residence. As a result, Fields was charged by criminal complaint on March 20, 2013 and by indictment on April 18, 2013.
“This defendant preyed on vulnerable members of our society--young women living in the shadows and on the margins, struggling to get by,” said Acting Assistant Attorney General Jocelyn Samuels of the Civil Rights Division. “Using false promises to lure them in, he cruelly exploited them for his own profit, destroying them with drugs and selling them for sex, using highly addictive illegal drugs to hold them under his control. Our Constitution guarantees freedom from involuntary servitude and slavery to all members of our society, and we will continue to enforce our human trafficking laws to restore freedom and dignity to victims of modern day slavery.”
“Today’s verdict provides a measure of justice for the vulnerable victims this defendant systematically forced into prostitution,” said Acting U.S. Attorney A. Lee Bentley III. “The United States Attorney’s Office and the Civil Rights Division are committed to prosecuting all human trafficking, regardless of the form it takes.”
“Sex trafficking is one of the most heinous crimes our special agents investigate and HSI is committed to protecting those who cannot protect themselves”, said Susan McCormick special agent in charge of HSI Tampa. “These cases are extremely difficult to investigate and prosecute and it would not be possible without the hard work and dedication of our special agents and law enforcement partners.”
This case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), with the assistance of the Clearwater Police Department and members of the Clearwater Area Human Trafficking Task Force. It is being prosecuted by Assistant U.S. Attorney Josephine W. Thomas and Trial Attorney William E. Nolan with the Civil Rights Division's Human Trafficking Prosecution Unit.
Lutz, FLA., Man Convicted on Drug Distribution and Sex Trafficking ChargesRead the Press Release
WASHINGTON – Acting U.S. Attorney A. Lee Bentley III and Acting Assistant Attorney General Jocelyn Samuels of the Civil Rights Division today announced the conviction of Andrew Blane Fields, 62, of Lutz, Fla., in the Middle District of Florida on charges of possession with intent to distribute controlled substances, namely Oxycodone, Dilaudid and Morphine, and sex trafficking by force, fraud and coercion. Fields faces a mandatory minimum of 15 years in prison and a statutory maximum of life in prison on each of the five sex trafficking convictions.
In a superseding indictment returned Aug. 22, 2013, a federal grand jury charged Fields with engaging in a sex trafficking scheme whereby he controlled his victims by supplying them with highly addictive controlled substances and by using their fear of withdrawal symptoms to force them into prostitution for his profit. At trial, the government presented evidence that the defendant recruited vulnerable young women who were engaging in prostitution or performing at strip clubs and then rapidly escalated their drug use into full-blown addiction. Other evidence included the testimony of five victims of the defendant’s scheme, quantities of narcotics seized from the defendant’s possession and images of the defendant surreptitiously distributing narcotics to a hospitalized victim.
During the execution of a federal search warrant, law enforcement officers recovered thousands of prescription pills from Fields' residence. As a result, Fields was charged by criminal complaint on March 20, 2013 and by indictment on April 18, 2013.
“This defendant preyed on vulnerable members of our society--young women living in the shadows and on the margins, struggling to get by,” said Acting Assistant Attorney General Jocelyn Samuels of the Civil Rights Division. “Using false promises to lure them in, he cruelly exploited them for his own profit, destroying them with drugs and selling them for sex, using highly addictive illegal drugs to hold them under his control. Our Constitution guarantees freedom from involuntary servitude and slavery to all members of our society, and we will continue to enforce our human trafficking laws to restore freedom and dignity to victims of modern day slavery.”
“Today’s verdict provides a measure of justice for the vulnerable victims this defendant systematically forced into prostitution,” said Acting U.S. Attorney A. Lee Bentley III. “The United States Attorney’s Office and the Civil Rights Division are committed to prosecuting all human trafficking, regardless of the form it takes.”
“Sex trafficking is one of the most heinous crimes our special agents investigate and HSI is committed to protecting those who cannot protect themselves”, said Susan McCormick special agent in charge of HSI Tampa. “These cases are extremely difficult to investigate and prosecute and it would not be possible without the hard work and dedication of our special agents and law enforcement partners.”
This case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), with the assistance of the Clearwater Police Department and members of the Clearwater Area Human Trafficking Task Force. It is being prosecuted by Assistant U.S. Attorney Josephine W. Thomas and Trial Attorney William E. Nolan with the Civil Rights Division's Human Trafficking Prosecution Unit.
Logan Men Enter Guilty Pleas in Connection with Arson SchemeRead the Press Release
Defendants conspired to set blaze to Logan office building to collect $1 million insurance payment
CHARLESTON, W.Va. – Two men entered guilty pleas in federal court today in connection with a Logan arson scheme, announced U.S. Attorney Booth Goodwin. James Gregory Glick, and co-defendant Guy R. Miller, 39, both pleaded guilty to arson and conspiracy to commit mail and wire fraud. Glick, 44, of Logan, also pleaded guilty to conducting unlawful monetary transactions, and structuring currency transactions in connection with the scheme.
In November 2011, Glick arranged to have an office building located at 111 Stratton Street in Logan burned to collect more than $1 million in insurance proceeds. In late December 2011, the building was purchased by a known person for $45,000 prior to the scheme. That person, in turn, immediately sold the property to Glick in early January 2012 purportedly for $50,000.
During the scheme, Mr. Glick then paid William Jamey Thompson, 44, an independent insurance agent from Chapmanville, approximately $50,000 to obtain a fraudulently-inflated $1 million insurance policy from General Star Indemnity Company (“General Star”) in connection with the scheme.
On the night of February 1, 2012, Guy Miller, Shawn C. Simon, 41, of Charleston and another associate worked together to set the fire by spreading gasoline throughout the main floor.
Additionally, Mr. Glick made illegal transactions of more than $10,000 from the Logan Bank & Trust (“LB&T”) on more than nine occasions. Mr. Glick also structured more than $170,000 in monies from accounts at LB&T during the conspiracy. “Structuring” involves the breaking down of cash transactions in amounts of $10,000 or less for the purpose of avoiding a financial institution’s reporting requirements to the Internal Revenue Service (IRS).
Glick faces a minimum of seven years in prison when he is sentenced on February 19, 2014, by United States District Judge Thomas E. Johnston.
Miller, who also pleaded guilty today to a federal drug charge, participated in an oxycodone distribution conspiracy in and around Logan County during the spring of 2011. In the weeks following July 3, 2011, Miller made several trips to Florida to illegally obtain more than 1,000 oxycodone pills.
Miller faces a minimum of seven years in prison when he is sentenced on February 19, 2014.The plea hearings for Thompson and Simon are set for Thursday, Nov. 7, 2013.
The West Virginia State Police and the IRS conducted the investigation. Assistant United States Attorney Thomas Ryan is in charge of the prosecution.
The case was 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.
Local Doctor Pleads Guilty to Making False Statement to AgentRead the Press Release
St. Louis, MO – DR. ERICK FALCONER pled guilty to making a false statement to federal agents regarding his purchases of misbranded Botox® from a foreign unlicensed drug wholesaler, some of which had counterfeit exterior packaging.
According to court documents, during the summer of 2009, Dr. Falconer received a facsimile transmission from an unlicensed drug wholesaler that offered low prices for assorted prescription drugs, including “Botox (Turkish)” for $354.99 a vial, listing a 1-800 telephone number and an individual’s “g-mail” address for contact purposes. The facsimile was sent to his medical practice, The Youthful Body, Inc., in Florissant, Missouri. During this same time frame, the FDA-approved version of Botox® was sold through licensed drug wholesales at higher prices in the United States, typically $525 a vial. From August 2009 through February 2013, Dr. Falconer and his corporation made over fifty separate purchases of these counterfeit drugs, which he provided to his patients without informing them of the source of the drugs. During an interview in February 2013 with special agents of the U.S. Food and Drug Administration (“FDA”), Dr. Falconer told the agents he had only made three purchases of the illegal drugs from this unlicensed foreign wholesaler. On April 26, 2013, FDA issued an alert regarding “fraudulent versions of Botox found in the United States” with counterfeit exterior cartons.
Falconer, of St. Louis, Missouri, pled guilty to one felony charge of making a false statement before United States District Judge Carol E. Jackson. Sentencing has been set for February 4, 2014.
Dr. Falconer faces a maximum penalty of five years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the U.S. Food and Drug Administration, with assistance from the Office of Inspector General for the U.S. Department of Health and Human Services.
Jamesville Man Sentenced to 540 Months for Producing Child PornographyRead the Press Release
NEW BERN - United States Attorney Thomas G. Walker announced that in federal court today MEREDITH CLIFTON COOK, 47, was sentenced by Federal District Court Judge Louise W. Flanagan to 540 months imprisonment followed by a lifetime of supervised release and a fine of $50,000 for two counts of producing child pornography.
Investigation of this case was conducted by the Federal Bureau of Investigation with the assistance of the Martin County Sheriff’s Office. Prosecution was coordinated with the Martin County District Attorney’s Office. Assistant United States Attorneys Jay Exum and Ethan Ontjes handled the case for the United States.
U.S. Attorney Thomas G. Walker commented, “This is one of the worst cases of child sexual abuse and exploitation ever discovered in our district,” said Walker. “To sexually abuse the most helpless of children and then share that abuse with the world is conduct that cannot and should not be tolerated.”
Two separate offices of the Federal Bureau of Investigation – one in Charlotte, the other in Houston, Texas – developed leads in June of 2011 that an individual later determined to be COOK was engaged in trading child pornography over a peer-to-peer network frequented by child pornography traffickers. Investigators traced the account to Jamesville, North Carolina, leading to a search in November of 2011. Investigators discovered that COOK had amassed a massive library of multiple hundreds of thousands of child pornography images and videos and that he had been actively talking about his interest in the sexual abuse of infants online. After the initial search, investigators discovered that COOK had recorded his own sexual abuse of multiple children and redistributed the images over the internet. The victims were all younger than 7 years of age.
This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.Illegal Alien from the Domincan Republic SentencedRead the Press Release
Defendant Who Illegally Re-Entered the United States Sentenced to Ten Months Imprisonment
ALBANY, NEW YORK—HERMIS ANTONIO ADAMES, age 35, a citizen of the Dominican Republic, was sentenced today to ten months of imprisonment for illegally reentering the United States after removal by Chief United States District Court Judge Gary L. Sharpe, announced United States Attorney Richard S. Hartunian and Michael T. Phillips, Field Office Director, U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations. Following ADAMES’ sentence he will be remanded to the Department of Homeland Security for removal proceedings. Today’s sentencing followed ADAMES’ July 9, 2013, guilty plea.
ADAMES, a citizen of the Dominican Republic, was involuntarily removed from the United States to the Dominican Republic on May 6, 2009. On April 3, 2013, ADAMES, who did not have permission to re-enter the United States, was encountered by Immigration and Customs Enforcement officers in Albany, New York.
This case was investigated by the Department of Homeland Security, U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations, Albany, New York.
Hilliard Woman Sentenced to 5-1/2 Years in Prison for Role in Mortgage Fraud SchemesRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS – Deborah L. Kistner, 50, Hilliard, Ohio was sentenced to 66 months in prison, five years of supervised release and ordered to repay victims $9,644,601.84 for deceiving lenders while securing fraudulent real estate loans in three different conspiracies between July 2006 and July 2010. Her husband, Mark A. Kistner, 52, was sentenced to five years of probation, ordered to forfeit his retirement account worth about $300,000 and make restitution of $381,764.92.
Carter M. Stewart, United States Attorney for the Southern District of Ohio; Kathy Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS), Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation (FBI) and other agencies participating in the mortgage fraud task force announced the sentences imposed by U.S. District Judge Gregory L. Frost.
“Over five years, Kistner participated in an ongoing, multi-million dollar mortgage fraud in which banks and lending institutions were defrauded out of several million dollars in mortgage loans,” Assistant U.S. Attorney Laura Fulton told the court prior to sentencing. " Her role as a title agent mandated that she be a ‘gatekeeper’ for banks funding these mortgages, and she violated that position of trust.”
The Hilliard couple pleaded guilty on January 18, 2013, four days after their trial started. Deborah Kistner pleaded guilty to three counts of conspiracy to commit bank fraud, three counts of conspiracy to commit money laundering, and one count of bank fraud. Mark Kistner pleaded guilty to one count of conspiracy to commit money laundering.
Deborah Kistner operated Premiere Title Company in Hilliard. She deceived lenders in connection with the purchases of real estate in Ohio and Florida. She conspired with others to secure inflated loans for real estate and kept the excess proceeds or used them to pay others involved in the conspiracy. Deborah Kistner intentionally failed to provide lenders with critical purchase contract language and accurate settlement statements.
Deborah and Mark Kistner also schemed to defraud lenders and launder the money they received through simultaneous “short sale” closings where the lenders would agree to absorb losses on existing mortgage loans while Deborah Kistner actually sold those properties on the same day for a profit and laundered the profits through bank accounts controlled by Mark Kistner.
Stewart commended the cooperative investigation of this case by IRS and FBI agents, and Assistant U.S. Attorney’s Laura Fulton and Dan Brown, who prosecuted the case.
Health Care Service Provider and Others Indicted for Medicaid FraudRead the Press Release
NORFOLK, Va. – W. Wayne Perry, Jr., 54, of Suffolk, Va., was indicted by a federal grand jury today on one count of health care fraud, twenty-four counts of false statements relating to health care matters, one count of alteration of records and four counts of aggravated identity theft. Angela Perry, 51, of Suffolk, Va., was indicted on the same charges. Allison Hunter-Evans, 46, of North Chesterfield, Va., was indicted on one count of alteration of records.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, made the announcement.
W. Wayne Perry, Jr. and Angela Perry each face a maximum penalty of ten years in prison for health care fraud, five years on each of the false statement counts, twenty years for alteration of records, and two years on each of the aggravated identity theft counts, if convicted. Hunter-Evans faces a maximum penalty of twenty years in prison for alteration of records.
According to the indictment, W. Wayne Perry, Jr. is the owner and operator of Community Personal Care, a business located in Norfolk, Va. that is authorized to provide home health care services that are reimbursable by Medicaid, including personal care and respite care services. Angela Perry, his wife, is an officer and agent of the company. Between January 2009 and December 2012, Wayne Perry and Angela Perry orchestrated a false billing scheme where approximately 6,472 fraudulent claims were submitted to the Virginia Medicaid program, falsely representing that personal care and respite care services had been provided to 78 Medicaid recipients by Community Personal Care. The defendants thereby obtained health care benefit payments from the Virginia Medicaid program in the approximate amount of $1,328,744 to which they were not entitled. In order to conceal the fraudulent payments, Wayne Perry and Angela Perry altered the company’s office records, including time sheets. This was done with the assistance of Allison Hunter-Evans, who was then an employee of the Virginia Department of Behavioral Health and Development Services.
This case was investigated by the FBI and the Virginia Attorney General’s Medicaid Fraud Control Unit. Assistant United States Attorneys Alan M. Salsbury and Elizabeth M. Yusi are prosecuting the case on behalf of the United States.
Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Harrisburg Woman Charged with ConspiracyRead the Press Release
To Submit False Claims To The IRS
The U.S. Attorney's Office for the Middle District of Pennsylvania announced that Stephanie A. Metz, age 25, of Harrisburg, Pennsylvania, was charged Tuesday with conspiracy to submit 33 fraudulent income tax returns to the IRS requesting $242,095 in fraudulent tax refunds for the years 2010 and 2011.
According to U.S. Attorney Peter J. Smith, Metz provided a co-conspirator with addresses where the fraudulent income tax refund checks could be delivered by mail and was paid a fee for each refund check she delivered to her co-conspirator. For the tax years 2010 and 2011, Metz provided addresses for 33 fraudulent income tax returns requesting $242,095 in fraudulent tax refunds. The IRS paid out $57,216 to the co-conspirator before the scheme was detected in early 2012.
The investigation is part of a project known as Operation Mass Mail involving the filing of hundreds of thousands of false returns using stolen identity information of residents of Puerto Rico. The investigation was conducted by the Criminal Investigation Division of the IRS and is assigned to Senior Litigation Counsel Bruce Brandler.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is 10 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Harrisburg Man Charged Federally with Use of the Telephone and Text Messaging to Entice A Minor to Engage in Sexual ActivityRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania, along with Pennsylvania Attorney General Kathleen Kane and Pennsylvania State Police Commissioner Frank Noonan announced that a federal grand jury in Harrisburg returned an indictment today charging Matthew Baratucci, age 29, of Harrisburg, Pennsylvania, for attempted coercion and enticement of a minor to engage in sexual activity.
According to United States Attorney Peter J. Smith, the charge resulted from Baratucci allegedly soliciting several women via the telephone and text messaging in October 2013, to allow him to engage in sexual activity with minor females aged five through nine years old. Baratucci is also facing state charges related to the alleged incidents.
The case is the result of a joint investigation by the United States Postal Inspection Service, the Pennsylvania Office of Attorney General, the Pennsylvania State Police, and the Lower Paxton Police Department.
Anyone with information about this case or the defendant, Matthew Baratucci, is asked to contact U.S. Postal Inspector Michael Corricelli at 717-257-5581.
Prosecution is assigned to Assistant United States Attorney Daryl F. Bloom.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the minimum penalty under the federal statute is ten years’ imprisonment and the maximum is life imprisonment, term of supervised release following imprisonment of up to life, and a $250,000 fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.Four Men Indicted for Child PornRead the Press Release
Project Safe Childhood
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that four southern Missouri men were indicted by a federal grand jury today in separate and unrelated cases for downloading and distributing child pornography over the Internet.
James Hayden McClelland, 20, of Billings, Mo., was charged with one count of receiving and distributing child pornography over the Internet between July 27, 2011, and Aug. 16, 2012.
This case is being prosecuted by Assistant U.S. Attorney James J. Kelleher. It was investigated by the Springfield, Mo., Police Department, the FBI and the Southwest Missouri Cyber Crimes Task Force.
Adam Headley, 34, of Springfield, was charged with one count of receiving and distributing child pornography over the Internet between Jan. 1, 2012, and Feb. 13, 2013.
This case is being prosecuted by Assistant U.S. Attorney James J. Kelleher. It was investigated by the FBI and the Kirksville, Mo., Police Department.
Luis Eduardo Martinez, 22, of Carthage, Mo., was charged with one count of receiving and distributing child pornography over the Internet between May 16, 2012, and Dec. 19, 2012.
This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the Southwest Missouri Cyber Crimes Task Force, the Cassville, Mo., Police Department and the Nixa, Mo., Police Department.
Ricardo Vargas-Villalobos, 24, of Carthage, Mo., was charged with one count of receiving and distributing child pornography over the Internet between May 16, 2012, and Dec. 19, 2012.
This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the Southwest Missouri Cyber Crimes Task Force, the Cassville, Mo., Police Department and the Nixa, Mo., Police Department.
Dickinson cautioned that the charges contained in these indictments are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."Four Individuals Indicted for Theft of Tribal FundsRead the Press Release
United States Attorney Brendan V. Johnson announced that four individuals were indicted by a federal grand jury on October 11, 2013, for stealing funds from the Oglala Sioux Tribe.
Samone Darla Milk, a/k/a Samone Darla Long Pumpkin, age 32, of Martin, South Dakota, was indicted for Conspiracy to Commit Theft Concerning Programs Receiving Federal Funds and two counts of Theft Concerning Programs Receiving Federal Funds.
Heather Marie Garcia, a/k/a Heather Marie Brings Plenty, age 30, Joe Marquios Garcia, age 34, and Wayne Wilson Cortier, age 45, all of Pine Ridge, South Dakota, were indicted for Conspiracy to Commit Theft Concerning Programs Receiving Federal Funds and one count of Theft Concerning Programs Receiving Federal Funds.
All four defendants appeared before U.S. Magistrate Veronica L. Duffy on October 16, 2013, and pled not guilty to the Indictments.The conspiracy count carries a maximum penalty upon conviction of up to 5 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered. The theft counts carry a maximum penalty upon conviction of up to 10 years in custody and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that the defendants made fraudulent claims on the Oglala Sioux Tribe’s Low Income Home Energy Assistance Program. Milk and Heather Garcia were employed by the Tribe at the time of the offenses, and Joe Garcia and Cortier were contractors for the Tribe.
The charges are merely accusations and the defendants are presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations. Assistant U.S. Attorney Ann M. Hendrickson is prosecuting the case.
All four defendants were released pending trial. A trial has been set for December 17, 2013.Former Tennessee Police Officer Pleads Guilty to Assaulting Handcuffed ArresteeRead the Press Release
Christopher Eugene Reynolds, 39, a former police officer of the Selmer, Tenn., Police Department (SPD), pleaded guilty today in the U.S. District Court for the Western District of Tennessee to violating the civil rights of an arrestee, the Justice Department announced.
During his guilty plea before U.S. District Judge J. Daniel Breen, Reynolds admitted that, while using his authority as a SPD officer, he slammed a handcuffed arrestee to the floor of the McNairy Regional Hospital and struck him in the face. According to information presented in court, Reynolds acknowledged that this assault was unreasonable and did not serve a legitimate law enforcement purpose. The victim was injured as a result of the assault.
“Mr. Reynolds has admitted that he used unjustified and unlawful force against a handcuffed arrestee,” said Acting Assistant Attorney General for the Civil Rights Division Jocelyn Samuels. “The Justice Department will continue to prosecute law enforcement officers who violate the constitutional rights of individuals in their custody.”
Sentencing has been scheduled for Feb. 5, 2014. Reynolds faces a maximum statutory penalty of 10 years in prison.
This case was investigated by FBI Special Agent Christopher Miller with the assistance of the Tennessee Bureau of Investigation. The case is being prosecuted by Civil Rights Division Trial Attorney Ryan J. Murguía and Special Litigation Counsel Gerard V. Hogan, with the assistance of Assistant U.S. Attorney Victor L. Ivy of the Western District of Tennessee.
Former Moore Resident Who Sought Benefits Following May Tornado Is Charged with Disaster Benefits FraudRead the Press Release
Oklahoma City, Oklahoma – A federal grand jury has indicted IRA ROBERT SCHILLING, 42, a former resident of Moore, Oklahoma, for committing disaster benefits fraud and making false statements in connection with a claim for benefits following the May 2013 tornados in Moore, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, the May 20, 2013, tornado affecting Cleveland County was declared a major disaster and the payment of disaster benefits was authorized. The indictment alleges that on June 16, 2013, Schilling signed a Department of Air Force memorandum requesting evacuation allowances and benefits on behalf of his dependents. In that memorandum, it is alleged, Schilling certified that after a May 20, 2013, storm he evacuated from a home in Moore, Oklahoma, and that he and two of his dependents were residing at the Safe Haven location in Norman, Oklahoma. Specifically, it is alleged that Schilling falsely submitted a travel voucher to the Air Force for costs associated with his relocation from Moore to Norman when he knew that no such costs had been incurred for a dependent-associated relocation. In addition, it is alleged that Schilling sent an email to the Air Force falsely claiming entitlement to extended Safe Haven benefits, including per diem payments, when he knew that he was not entitled to receive those benefits.
If convicted, Schilling faces up to 30 years in prison, a $250,000 fine, and payment of restitution. The public is reminded that the indictment is merely an accusation and that the defendant is each presumed innocent unless and until proven guilty. Reference is made to the indictment for further information.
This case is the result of an investigation by the U.S. Air Force Office of Inspector General and is being prosecuted by Assistant U.S. Attorney Brandon Hale.
Former Mental-Health Clinic Therapist Sentenced for Role in $55 Million Medicare Fraud SchemeRead the Press Release
A former therapist for Biscayne Milieu, a Miami-based mental-health clinic, was sentenced today to serve 120 months in prison for his participation in a $55 million Medicare fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG) Miami office made the announcement.
Jose Rojo, 39, of Miami, was sentenced by U.S. District Judge Marcia G. Cooke in the Southern District of Florida. Rojo was convicted on Aug. 7, 2013, of one count of conspiring to commit health care fraud following a one-month jury trial. In addition to the prison term, Rojo was ordered to pay more than $11 million in restitution, jointly and severally with his co-defendants, and to serve three years of supervised release.
According to the evidence at trial, Rojo and his co-conspirators caused the submission of more than $55 million dollars in fraudulent claims to Medicare through Biscayne Milieu, which purportedly operated a partial hospitalization program (PHP) – a form of intensive treatment for severe mental illness. Instead of providing PHP services, the defendants devised a scheme in which they paid patient recruiters to refer ineligible Medicare beneficiaries to Biscayne Milieu for services that were never provided. Many of the patients admitted to Biscayne Milieu were not eligible for PHP because they were chronic substance abusers, suffered from severe dementia and would not benefit from group therapy, or had no mental health diagnosis but were seeking exemptions for their U.S. citizenship applications.
The evidence at trial further showed that, as a therapist at Biscayne Milieu, Rojo conducted sham therapy sessions for patients he knew were ineligible for PHP treatment. Often Rojo showed up late for these sessions or not at all, but Medicare was still billed as if a full session took place. Rojo created fraudulent documents to help cover-up Biscayne Milieu’s massive fraud, including bogus treatment plans and phony group therapy notes that were copied from one document to the other. Deliberately inaccurate group therapy notes for different patients on different days – often years apart – were in many respects identical, including having the same descriptions of patients’ statements in group sessions and even the same misspelled words. Further, Rojo provided other therapists at the clinic with fake group therapy notes for a fee. Biscayne Milieu billed Medicare for tens of millions of dollars in PHP treatments for these patients.
Various owners, doctors, managers, therapists, patient brokers and other employees of Biscayne Milieu have also been charged with health care fraud, kickback violations, money laundering and other offenses in two indictments unsealed in September 2011 and May 2012. Biscayne Milieu, its owners, and more than 25 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial. Antonio and Jorge Macli and Sandra Huarte – the owners and operators of Biscayne Milieu – were each convicted at trial and were sentenced in April 2013 to 30 years, 25 years and 22 years in prison, respectively.
This case was investigated by the FBI with the assistance of HHS-OIG and was brought by the the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Assistant U.S. Attorneys Marlene Rodriguez and James V. Hayes of the Southern District of Florida; Hayes was formerly a trial attorney of the Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Former Jacksonville Man Sentenced for RobberyRead the Press Release
NEW BERN – United States Attorney Thomas G. Walker announced that yesterday in federal court, Judge Louise W. Flanagan sentenced carlos devaughn varnell , 26, of Mississippi, formerly of Jacksonville, North Carolina, to 60 months of imprisonment, followed by 3 years of supervised release.
Investigation of this case was conducted by the Jacksonville Police Department and the Bureau of Alcohol Tobacco, Firearms and Explosives. Assistant United States Attorney S. Katherine Burnette represented the government.
VARNELL was named in an Indictment filed on April 4, 2013, charging him with conspiracy to commit Hobbs Act Robbery and Hobbs Act Robbery; aiding and abetting. On August 15, 2013, VARNELL pled guilty to those charges.
According to the investigation, VARNELL was the driver of a car, stopped by the Jacksonville Police Department on April 30, 2012, shortly after a cab driver reported being robbed at gunpoint by two males. Two firearms were recovered from Varnell’s car, and both Varnell and his passenger were charged with the robbery.Former Fairfield Housing Authority Executive Director Who Embezzled $30k Is SentencedRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that ELIZABETH JO GUTIERREZ, 47, of Ridgefield, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to five years of probation, the first six months of which GUTIERREZ must spend in home confinement under electronic monitoring, for embezzling $30,000 from the Fairfield Housing Authority.
The Fairfield Housing Authority administers federal housing programs for the U.S. Department of Housing and Urban Development with the mission of providing affordable housing for eligible low-income families and the elderly.
According to court documents and statements made in court, GUTIERREZ served as the Executive Director for the Fairfield Housing Authority from approximately July 2010 to December 2011. In the summer of 2011, GUTIERREZ issued two checks, each in the amount of $15,000, from the Fairfield Housing Authority’s checking account and subsequently deposited them into her own checking account.
On June 4, 2013, GUTIERREZ pleaded guilty to one count of theft concerning programs receiving federal funds.
GUTIERREZ was ordered to pay restitution in the amount of $30,000.
This matter was investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General, and was prosecuted by Special Assistant U.S. Attorney Sean Beaty.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Former CEO of the Bank of the Commonwealth Sentenced to 23 Years in Prison for Massive FraudRead the Press Release
NORFOLK, Va. – Edward J. Woodard, 70, of Norfolk, Virginia, was sentenced today to 23 years in prison, followed by 5 years of supervised release, for conspiracy to commit bank fraud, false entry in a bank record, unlawful participation in loans, false statements to a financial institution, misapplication of bank funds, and bank fraud. The Court further ordered Woodard to pay $333,569,732.00 in restitution to the Federal Deposit Insurance Corporation.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia; Royce E. Curtin, Special Agent in Charge of the FBI Norfolk Field Office; Thomas J. Kelly, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation Field Office in Washington, D.C. (IRS-CI); Christy L. Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP); Fred W. Gibson, Jr., Acting Inspector General of the Federal Deposit Insurance Corporation (FDIC-OIG); and Mark Bialek, Inspector General of the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau (FRB-CFPB OIG), made the announcement after sentencing by United States District Judge Raymond A. Jackson.
“Defendant Woodard’s felonious conduct, motivated by his own greed, destroyed a financial institution, left former bank employees jobless, and defrauded a federal recovery program out of millions of dollars,” stated Acting United States Attorney Dana J. Boente. “Through the diligence and determination of my office, along with our multiple law enforcement partners, Woodard now stands convicted, incarcerated, and publicly accountable for his unlawful deeds.”
SAC Royce Curtin said, “This investigation involved several complex, fraudulent banking schemes resulting in significant losses to financial institutions and American taxpayers. Today’s sentencing sends a clear message that the FBI and our partners will aggressively pursue and bring to justice those individuals involved in these types of dishonest and deceitful frauds to ensure they are punished to the fullest extent of the law.”
“Motivated by greed, Woodard lied, cheated, and stole,” said Christy Romero, Special Inspector General for TARP (SIGTARP). “TARP is not an opportunity to finance banks failing under the weight of fraud, but Woodard used fraudulent bank books and records to try to cheat federal taxpayers out of $28 million in TARP bailout funds to fill the holes he caused in the bank’s books. SIGTARP and our law enforcement partners will hold all those guilty of crimes related to TARP accountable because no one is above the law.”“Today’s sentencing of Mr. Woodard sends a powerful message to the public that bank insiders who abuse their positions of trust and cause irreparable harm to their banks will be brought to justice and held accountable,” stated Fred Gibson, Jr., Acting Inspector General of the FDIC. “We are committed to continuing to work with our Department of Justice and other law enforcement colleagues on such cases, in the interest of ensuring the safety and soundness of the nation’s banks and the viability of the FDIC’s Deposit Insurance Fund—which suffered massive losses when the Bank of the Commonwealth failed.”
“Our office is committed to bringing to justice bank executives, like Mr. Woodard, who engage in illegal activities that undermine the public trust,” said Mark Bialek, Inspector General of the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau. “Today’s sentencing should serve as a warning that fraud affecting the integrity of financial institutions critical to our economy will not be tolerated. I commend the hard work of our agents and their federal law enforcement partners who ultimately exposed Mr. Woodard’s conspiracy.”
A jury found Woodard guilty after a lengthy, ten week, jury trial on May 24, 2013. Evidence presented at trial demonstrated that Woodard, the former Chief Executive Officer and Chairman of the Board for the Former Bank of the Commonwealth (“Bank”), engaged in an illegal reciprocal relationship with certain troubled borrowers to mask the Bank’s deteriorating financial condition. Conspirators Thomas E. Arney, Eric H. Menden, and George P. Hranowskyj all testified at trial that, at the request of Woodard and Executive Vice President Stephen G. Fields, they performed favors such as buying Bank of the Currituck stock, bailing out Woodard’s son on bad investments, and purchasing bank-owned property with fully-funded Bank of the Commonwealth loans. In return, Arney, Menden and Hranowskyj all received preferential treatment such as affording large overdrafts, sometimes for hundreds of thousands of dollars, below-market interest rates, loans to make interest payments on other loans, and easy access to credit. Additionally, Woodard funded three loans totaling $11 million without the approval of the Board of Directors to another troubled borrower who was in bankruptcy and the subject of a federal grand jury investigation. Later, Woodard made false entries in bank records to cover-up the fact that he authorized the funding of these loans without proper approval.
Throughout the conspiracy, Woodard enriched himself and his son at the Bank’s expense. Despite the fact that Arney had not made loan payments in over a year, Woodard nevertheless arranged for Arney to purchase his personal condominium at an inflated price using 100% financing from the Bank and made $56,000. Woodard also ensured that Menden and Hranowskyj purchased his son’s failed investment properties and personal condominium with bank funds earning his son more than $69,000. Finally, Woodard also caused the Bank to pay approximately $100,000 for renovations to his son’s personal residence, thousands of dollars in fraudulent commissions owed and his son’s personal legal fees.
In addition to having a substantial impact on property values in the Hampton Roads area, Woodard’s crimes were a significant factor in the failure of the Bank of the Commonwealth on September 23, 2011. As a result of this failure, the FDIC has sustained at least $333 million in losses.
The Investigation was conducted by the FBI’s Norfolk Field Office, IRS-CI, SIGTARP, FDIC-OIG, and FRB-CFPB OIG. Assistant United States Attorneys Katherine Lee Martin, Melissa E. O’Boyle, and Uzo Asonye prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Former ACCESS President Sentenced to Federal Prison in El Paso Corruption CaseRead the Press Release
In El Paso today, former ACCESS Health Source Chief Executive Officer and President Frank Apodaca and El Paso Public Relations consultant Marc Schwartz were each sentenced to eight years in federal prison followed by three years of supervised release for their roles in conspiring to engage in a racketeering scheme focusing on the now-defunct company announced United States Attorney Robert Pitman and FBI Special Agent in Charge Douglas E. Lindquist.
United States District Judge Frank Montalvo also ordered that the defendants pay restitution in the following amounts: $4.1 million to the El Paso Independent School District (EPISD); $2,286,629.76 to the Ysleta Independent School District (YISD); and, $433,103.11 to El Paso County. Furthermore, Judge Montalvo ordered that each defendant self–surrender to a U.S. Bureau of Prisons designated facility on or before December 18, 2013, to begin serving his prison term.
“The sentences handed down today should reassure the public that we will be relentless in pursuing those who would attempt to corrupt public officials as well as those public officials who violate their public trust for personal gain,” stated U.S. Attorney Robert Pitman.
ACCESS, among other things, was a third party administrator of healthcare benefits for self-insured entities. Between 1998 and 2007, ACCESS contracted with self-insured local (El Paso) government entities, including the County, the City and all of the local school districts, among other entities, to provide administrative services for health insurance programs provided by their employer.
Last year, both pleaded guilty to one count of conspiracy to engage in racketeering activity (RICO). By pleading guilty, Apodaca and Schwartz admitted to participating in a scheme involving ACCESS and others to engage in a pattern of racketeering activity, including mail fraud, wire fraud and bribery with elected and appointed members of the El Paso County Commissioners Court and elected Trustees of EPISD, YISD and the Socorro Independent School District to secure and retain lucrative health care management service contracts. Specifically, Schwartz admitted that he carried out schemes on behalf of Apodaca, former ACCESS CEO and President and National Center for the Employment of the Disabled (NCED) Board member; ACCESS owner and NCED CEO Robert “Bob” Jones; and, El Paso attorney Luther Jones to pay bribes to elected officials, including former Socorro ISD Trustees Raymundo “Ray” Rodriguez, Guillermo “Willie” Gandara, Sr., and Charles “Charlie” Garcia; former YISD Trustees Linda Chavez and Mickey Duntley; former EPISD Trustee Salvador “Sal” Mena; former El Paso County Commissioners Elizabeth “Betti” Flores and Larry Medina; and, former El Paso County Judge Dolores Briones, for performing acts in their official capacity which benefitted ACCESS.
“The sentencing of Frank Apodaca Jr. and Marc Schwartz marks another chapter in a ten year investigation in which public confidence was betrayed by a group of elected officials and vendors who used their influence to promote their own personal greed. It also shows the continued commitment of the FBI to aggressively pursue individuals who violated the public’s trust by holding them personally accountable for their self-serving acts,” stated FBI SAC Douglas E. Lindquist.
This FBI investigation has resulted in 39 federal convictions -- 36 individuals who entered guilty pleas and three individuals who were convicted by juries.
Assistant United States Attorneys Debra Kanof and Jose Luis Gonzalez are prosecuting this case on behalf of the Government.Forest Man Sentenced on Drug ChargesRead the Press Release
Jackson, Miss. – Jerry Lynn Loper, 45, of Forest, was sentenced today by U.S. District Judge William H. Barbour, Jr. to serve 95 months in federal prison followed by three years of supervised release for possession of a firearm by a convicted felon, announced U.S. Attorney Gregory K. Davis. Loper was also ordered to pay a $1500.00 fine and forfeit 9 firearms which were seized.
Loper was indicted following an extensive investigation, dubbed “Operation Brusha”, targeting illegal narcotics distribution in Scott County, Mississippi. The investigation was conducted by the Mississippi Bureau of Narcotics, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Homeland Security Investigations and the Organized Crime Drug Enforcement Task Force. Assisting agencies included the Mississippi Highway Patrol, Mississippi Bureau of Investigation, Forest Police Department, and Scott County Sheriff’s Department. The case was prosecuted by Assistant U.S. Attorney Erin O. Chalk.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
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Five Plead Guilty to Their Involvement in Kidnapping CaseRead the Press Release
Jackson, Miss. – Five defendants entered guilty pleas before U.S. District Judge William H. Barbour Jr. in federal court today for their involvement in the kidnapping of Jashayla Hopson from East Kemper Elementary School on April 30, 2013, announced U.S. Attorney Gregory K. Davis and FBI Special Agent in Charge Daniel McMullen.
Wanda Faye Dancy, of DeKalb, Mississippi, Shamarius S. Ruffin, of Porterville, Mississippi, and Shaquayla S. Johnigan, also of Porterville, each pled guilty to conspiracy to kidnap. They each face a maximum penalty of five years in prison and a $250,000 fine.
Joyce M. Johnigan and James Shurman Johnigan both of Porterville, Mississippi, pled guilty to a criminal information charging them with misprision of a felony. They each face a maximum penalty of three years in prison and a $250,000 fine.
All five defendants are scheduled for sentencing by U.S. District Judge William H. Barbour Jr. on January 22, 2013 at 9:00 a.m.
The two remaining defendants in this case, Jesse Pollard and Devonta Pollard, are scheduled for trial on November 18, 2013. Jesse Pollard is charged with kidnapping, conspiracy to kidnap and obstruction of justice. She faces a maximum penalty of life in prison and a $750,000 fine. Devonta Pollard is charged with conspiracy to kidnap and faces a maximum penalty of five years in prison and a $250,000 fine.
This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney and Criminal Division Chief John M. Dowdy, Jr.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Our nation-wide commitment to reducing gun crime in America.