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Tuesday 5 November 2013
Illegal Alien Sentenced to Time Served for Re-Entering U.S. After Being DeportedRead the Press Release
PITTSBURGH, PA - An illegal alien found in Cranberry Township, Pennsylvania, pleaded guilty and has been sentenced in federal court to time served on his conviction of Re-Entry into the United States after Deportation, United States Attorney David J. Hickton announced today.
United States District Judge Gustave Diamond imposed the sentence on Josue Elias Calidonio-Castillo, 29, formerly from Honduras.
According to information presented to the court, Josue Elias Calidonio-Castillo, an alien, was removed from the United States by United States Immigration and Customs Enforcement on September 1, 2006. Josue Elias Calidonio-Castillo was found on July 16, 2013, in Cranberry Township, Pennsylvania.
Assistant United States Attorney Paul E. Hull prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Immigration and Customs Enforcement for the investigation leading to the successful prosecution of Josue Elias Calidonio-Castillo.
Huntington Heroin Dealer Enters Guilty Plea in Federal CourtRead the Press Release
HUNTINGTON, W.Va. – A Huntington man pleaded guilty on Nov. 4 in federal court in connection with his role in a heroin distribution conspiracy, announced U.S. Attorney Booth Goodwin. Forty-nine-year-old Ricky Ray Rockwell pleaded guilty to conspiracy to distribute heroin before Chief United States District Judge Robert C. Chambers in Huntington.
Between November 2010 and July 2011, Rockwell participated with convicted felons Kevin Luthor Robinson and Jermaine D. Dickerson to distribute heroin in and around the Huntington area.
Rockwell told police that during the illegal drug scheme, he controlled the door to a Huntington residence that was used primarily as a place to distribute illegal drugs. Rockwell also completed illegal heroin transactions on behalf of Robinson and Dickerson. Afterward, Rockwell gave the drug proceeds to his co-conspirators at the completion of the drug transactions.
Robinson, 44, was sentenced to 11 years and three months in prison in March for his role in the illegal drug conspiracy. Dickerson, 36, was also sentenced in March to 15 years and nine months in federal prison. Robinson and Dickerson, both of Columbus, previously pleaded guilty in December 2012 to conspiracy to distribute heroin and 28 grams or more of crack cocaine.
During the scheme, Robinson and Dickerson arranged frequent trips to Columbus to purchase heroin and cocaine. The illegal drugs were then brought to Huntington and sold. The defendants also utilized several Huntington residences to store, prepare and package illegal drugs during the fall of 2010 through July 2011.
Rockwell faces up to 20 years in federal prison when he is sentenced on February 24, 2014.
This case was investigated by the DEA, the Huntington Police Department, and the High Intensity Drug Trafficking Area Task Force. Assistant United States Attorney Joseph F. Adams is in charge of the prosecution.
Goodwin Announces Three Guilty Pleas in Federal Prescription Drug CrackdownRead the Press Release
BLUEFIELD, W.Va. – Three individuals from Mercer County pleaded guilty in federal court this week in connection with the illegal distribution of powerful prescription painkillers, announced U.S. Attorney Booth Goodwin. The charges against each defendant were brought as part of the Bluefield Pill Initiative, a concerted attack by federal, state, and local government on the illegal distribution of prescription drugs in the southern region of West Virginia.
The following defendants pleaded guilty on Nov. 4 to distribution of hydromorphone, a powerful prescription painkiller commonly known as Dilaudid: Darryl Shrader, 53, of Spanishburg; Bobby Michael Short Jr., 46, of Princeton; and Faith Michelle Akers, 44, of Princeton. Shrader, Short and Akers each sold hydromorphone pills to a confidential informant working in cooperation with law enforcement. The pill transactions took place in and around Mercer County.
All three defendants face up to 20 years in federal prison when they are sentenced on March 10, 2014 by Senior United States District Judge David A. Faber.
The Bluefield Pill Initiative is a collaborative, multi-agency regional law enforcement effort designed to halt prescription drug trafficking in Mercer, McDowell, and Wyoming counties. The Bluefield Pill Initiative is led by the Southern Regional Drug and Violent Crime Task Force, which includes the West Virginia State Police Bureau of Criminal Investigation, the Mercer, McDowell and Wyoming County Sheriff’s Departments, and the Bluefield and Princeton Police Departments. Assistant United States Attorney John File is in charge of the prosecutions.
Fort Yates Man Sentenced for Domestic Assault by Habitual OffenderRead the Press Release
BISMARCK– U.S. Attorney Timothy Q. Purdon announced that on Nov. 4, 2013, Marcus Flying Horse, 29, Fort Yates, N.D., was sentenced by U.S. District Judge Daniel L. Hovland on a charge of domestic assault by habitual offender. Flying Horse pleaded guilty to the charge on Aug. 13, 2013.
Judge Hovland sentenced Flying Horse to serve two years and three months in federal prison, to be followed by three years of supervised release. Flying Horse was ordered to pay a $100 special assessment to the Crime Victim’s Fund.
On March 1, 2013, Flying Horse committed a domestic assault by hitting a woman in the eye. At the time when this assault took place, Flying Horse had at least six prior misdemeanor convictions in Standing Rock Tribal Court for qualifying domestic violence offenses.
The case was investigated by the Bureau of Indian Affairs – Standing Rock Agency, with the assistance of the Standing Rock Tribal Prosecutor’s Office and Standing Rock Tribal Court.
Assistant U.S. Attorney Gary Delorme and Special Assistant U.S. Attorney Erin Shanley prosecuted the case. Ms. Shanley’s position is funded by a Department of Justice Office on Violence Against Women grant program.
Fort Yates Man Sentenced for Child AbuseRead the Press Release
BISMARCK – U.S. Attorney Timothy Q. Purdon announced that on Nov. 4, 2013, Terry Holy Elk Face, 21, Fort Yates, N.D., pleaded guilty and was sentenced by U.S. District Judge Daniel L. Hovland on a charge of child abuse in Indian country.
Judge Hovland credited Holy Elk Face for 159 days in custody, to be followed by two years of supervised release. Holy Elk Face was ordered to pay a $100 special assessment to the Crime Victim’s Fund.
On Dec. 22, 2012, Holy Elk Face hit a child in the face, which caused the child to fall into a piece of furniture. The child’s injuries were not life threatening.
The case was investigated by the Bureau of Indian Affairs – Standing Rock Agency.
Assistant U.S. Attorney Gary Delorme prosecuted the case.
Former Police Officer Sent to Federal PrisonRead the Press Release
HOUSTON - Michael Mares, a former officer with the Onalaska Police Department, has been ordered to federal prison for providing firearms to a convicted felon, announced United States Attorney Kenneth Magidson. Mares, 51, pleaded guilty, admitting he knowingly sold a firearm and various police items to a convicted felon who was planning a home invasion in which he and others planned on impersonating police officers.
Today, U.S. District Judge Nancy Atlas, ordered Mares serve a term of 37 months in federal prison. At the hearing, the court admonished Mares that when police officers arrive at a home, citizens rely on them actually being police officers and that Mares helped others who intended to abuse that trust to commit crimes.On Aug. 30, 2011, a FBI confidential source met with Mares and provided him with $1000 to purchase a firearm, five police t-shirts and police strobe lights. The source told Mares that he was a convicted felon. The source further noted he and others were going to conduct a home invasion of a narcotics trafficker and intended to impersonate police officers in order to gain control of the residence. Mares agreed to purchase the items for him.
The investigation culminated in the indictment of 25 members and associates of the Texas Mexican Mafia charged with drug trafficking, various firearms offenses and violent crimes in aid of racketeering.
According to the indictment, the TMM formed in the early 1980s in the Texas Department of Criminal Justice. The defendants conspired with one another and others from 2008 through October 2012 to procure illegal drugs and distribute the drugs to numerous associates involved in drug trafficking in order to carry out the business of the gang. Gang members also sold numerous assault rifles and other guns as well as detonation cord to FBI sources.
Mares has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The four-year investigation was conducted by the FBI, Texas Department of Public Safety, Bureau of Alcohol, Tobacco, Firearms and Explosives and Houston Police Department. Assistant United States Attorneys Tim S. Braley and Mark Donnelly are prosecuting.
Former Member of Moreno Valley City Council Agrees to Plead Guilty to Federal Bribery Charge for Taking $2.3 Million Cash PaymentRead the Press Release
RIVERSIDE, California – In a case stemming from what is believed to be the largest bribe ever accepted by a public official in an undercover operation, a former member of the Moreno Valley City Council has agreed to plead guilty to a federal bribery charge for taking a $2.36 million cash payment from an undercover operative posing as a real estate broker.
Marcelo Co, 64, was charged this morning with one bribery count and one count of filing a false corporate tax return. In court documents filed this morning in United States District Court, Co agreed to plead guilty to the two charges that could send him to federal prison for as long as 13 years.
“Mr. Co orchestrated an elaborate and brazen scheme to undermine the democratic process in Moreno Valley,” said United States Attorney André Birotte Jr. “Whether he was motivated by power or greed, these crimes constitute a wholesale violation of his oath to work for the citizens who elected him.”
Co, who was elected to the City Council in November 2010 and resigned from his seat in August after being charged in state court in an unrelated welfare fraud case, is expected to make his initial court appearance in the federal bribery case early next month.
“It is a very sad day for the citizens of Moreno Valley when one of their elected council members sacrifices his legal and ethical obligations for power and greed,” said Riverside County District Attorney Paul Zellerbach. “This type of unlawful conduct by Mr. Coe undermines the very fabric of good government and what we all hope and expect from our elected officials.”
The case against Co is the result of an ongoing investigation by the Inland Regional Corruption Task Force, which is comprised of prosecutors, agents and investigators from the Federal Bureau of Investigation, IRS – Criminal Investigation, the Riverside County District Attorney’s Office and the United States Attorney’s Office.
“Mr. Co regularly traded votes, land and confidential information in exchange for cash to fund his personal bank account, rather than what was in the best interest of the residents of Moreno Valley," said Bill Lewis, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. "This case was a result of seamless collaboration by the Inland Regional Corruption Task Force, whose members share a mission of rooting out corruption across the Inland Empire."
The court documents filed this morning outline a bribery scheme in which Co told a businessman and an undercover FBI operative posing as a real estate broker that he would control a voting majority of the Moreno Valley City Council and would be able to guarantee land use decisions that would benefit the businessman and the land broker. Co also promised to always vote in favor of land use decisions that would benefit the real estate broker.
Co solicited campaign donations from the businessman, who was cooperating with the investigation, and the FBI undercover operative. Co eventually received payments of $5,000 and $10,000 that he said were to be used to finance the campaigns of individuals who would vote with him on land use issues.
In the fall of 2012, Co met with the undercover operative to discuss a multimillion dollar sale of a 30-acre parcel that he owned. Co told the real estate broker that once he had control of the City Council, he could change the zoning of the property and the land value would dramatically increase. With the City Council election in November 2012, Co told the undercover investigator that he had the votes to alter the zoning and increase the value of Co’s 30-acre parcel, which had been appraised at $710,000. Co proposed that the undercover operative purchase the property for $5.36 million, which would include a cash payment of $2.36 million.
At a meeting on January 30, 2013, Co agreed to sell the property for $5.36 million, but that the publicly filed documents would reflect a sale price of only $3 million. At this meeting, Co accepted $2.36 million in cash.
The tax charge that was filed today concerns a United States Corporation Income Tax Return (Form 1120) that Co filed for his company, Qwik Pack Systems, for tax year 2010. In that filing with the IRS, Co failed to report well over $100,000 in income. This tax charge is not related to the bribery scheme.
“Mr. Co’s intentional omission of more than $112,000 in taxable income – and failure to pay $31,000 in tax to the IRS – was committed for his own private gain and was an insult to honest taxpayers and the citizens of Moreno Valley,” said Joel P. Garland, Acting Special Agent in Charge for IRS - Criminal Investigation, Los Angeles Field Office. “Today’s action is an example of IRS-CI’s vigilance when it comes to enforcing tax laws, particularly when it involves our public officials. IRS-CI, in partnership with our law enforcement partners, is committed to bringing to justice public officials who use their political office to commit crimes.”
At Co’s initial appearance in federal court, which is expected to be in early December, the case will be assigned to a District Judge who will schedule a hearing for Co to formally enter the guilty pleas.
Release No. 13-126
Former Lee's Summit Man Pleads Guilty to $3 Million Ponzi SchemeRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a former Lee’s Summit, Mo., man pleaded guilty in federal court today to defrauding 39 investors in a $3 million Ponzi scheme.
Ronald W. Shepard, 74, formerly of Lee’s Summit, pleaded guilty before U.S. District Judge Gary A. Fenner to mail fraud.
Shepard received approximately $3,188,765 from approximately 39 investors from January 2006 through December 2009. Shepard returned approximately $1,235,853 to the investors, and lost or spent the rest, resulting in a minimum loss to investors of $1,825,883.
Shepard, who prepared tax returns for individuals, discussed their investments and pitched his own companies as investments. Shepard’s company, Safety Solutions USA, LLC, in Lee’s Summit, developed and marketed a trailer hitch called Tow-Safe. A patent request for the trailer hitch safety device was filed, but rejected by the U.S. Patent Office. Shepard also operated a company called The Real Estate in Lee’s Summit.
Shepard claimed that investors would make anywhere from a 15 percent to 100 percent annual return on their investment. He failed to inform potential investors that the state had issued a cease and desist order that barred him from offering or selling any unregistered security. Shepard has never been registered to sell securities in the state of Missouri.
Shepard told investors that their money was used to purchase property in Kansas City, the Lake of the Ozarks and Hawaii. Except for purchasing his own personal residence at the Lake of the Ozarks, however, Shepard did not purchase any real estate. Instead, Shepard used investor funds for personal living expenses, to pay other investors, to pay relatives, in disbursements of cash to himself and in real estate ventures.
Many investors liquidated their Individual Retirement accounts or 401(k) accounts and transferred the proceeds to Shepard for investment. Shepard told investors that if they liquidated retirement funds, thereby incurring penalties, he would refund their initial investment, plus the amount of penalty, plus interest.
Under the terms of today’s plea agreement, Shepard will be sentenced to two years in federal prison without parole, to be served concurrently with the five-year sentence he is currently serving after his supervised release was revoked in another case. Shepard must pay a total of $1,825,883 in restitution to his victims.
This case is being prosecuted by Assistant U.S. Attorney Kate Mahoney. It was investigated by the FBI and the Missouri Division of Securities.Former Background Investigator for Federal Government Sentenced to Six Months in Prison for Making A False StatementRead the Press Release
WASHINGTON – Lindsay Branson III, 58, a former background investigator for the U.S. Office of Personnel Management (OPM), was sentenced today to six months of incarceration on a charge stemming from his falsification of work on background investigations of federal employees and contractors, announced U.S. Attorney Ronald C. Machen Jr. and Patrick E. McFarland, Inspector General for the Office of Personnel Management.
Branson, of Silver Spring, Md., pled guilty in July 2013 in the U.S. District Court for the District of Columbia to making a false statement. He was sentenced by the Honorable Amy Berman Jackson. Upon completion of his prison term, Branson will be placed on three years of supervised release. During that time, he is required to perform 200 hours of community service. In addition, he must pay $159,918 in restitution to the federal government.
According to a statement of offense submitted to the Court, Branson worked for Federal Investigative Services, a part of OPM that does federal background investigations.
Between September 2010 and November 2011, in multiple Reports of Investigations on background investigations, Branson represented that he had interviewed a source or reviewed a record regarding the subject of the background investigation. In fact, he had not conducted the interviews or obtained the records of interest. His reports were utilized and relied upon by the agencies requesting the background investigations to determine whether the subjects were suitable for positions having access to classified information, for positions impacting national security, or for receiving or retaining security clearances.
Branson’s false representations have required Federal Investigative Services to reopen and rework numerous background investigations that were assigned to him during the time period of his falsifications, at an estimated cost of at least $159,918 to the U.S. government.
Federal Investigative Services has a robust integrity assurance program which utilizes a variety of methods to ensure the accuracy of reported information. The falsification of investigative case work by the defendant was detected through the program.
This is one of numerous cases prosecuted by the U.S. Attorney’s Office for the District of Columbia since 2008 involving false representations by background investigators and record checkers working on federal background investigations. In addition to Branson, 16 other background investigators and two record checkers have been convicted of charges.
Federal Investigative Services, through its workforce of approximately 7,600, including 6,100 field investigators, is responsible for conducting background investigations for numerous federal agencies and their contractors, on individuals either employed by or seeking employment with those agencies or contractors. Federal Investigative Services conducted more than 2.3 million investigations during the 2013 fiscal year. More than 700,000 of these investigations involved applicants for access or continued access to classified information.
In performing background investigations, the investigators conduct interviews of individuals who have information about the person who is the subject of the review. In addition, the investigators seek out, obtain, and review documentary evidence, such as employment records, to verify and corroborate information provided by either the subject of the background investigation or by persons interviewed during the investigation. After conducting interviews and obtaining documentary evidence, the investigators prepare a Report of Investigation containing the results of the interviews and document reviews, and electronically submit the material to OPM in Washington, D.C. OPM then provides a copy of the investigative file to the requesting agency, which can use the information to determine an individual’s eligibility for employment or a security clearance.
In announcing the sentence, U.S. Attorney Machen and Inspector General McFarland praised the efforts of Special Agent Christopher Sulhoff, OPM, Office of the Inspector General, and Philip Kroop and David Newcomer, OPM, Federal Investigative Services. They also acknowledged the work of Paralegal Specialist Nicole Wattelet and Legal Assistant Angela Lawrence, as well as Assistant U.S. Attorneys Ellen Chubin Epstein and David A. Last, who investigated and prosecuted this matter.
13-377Florida Man Convicted for Attempted Online Enticement of a MinorRead the Press Release
TALLAHASSEE, FLORIDA – Following a trial in federal court in Tallahassee, a jury found Jose Galdamez, 42, of Tallahassee, Florida, guilty of using the Internet in an attempt to persuade, induce, and entice a minor to engage in sexual activity.
Evidence presented during trial proved that, on April 14, 2013, Galdamez responded to an advertisement entitled “Bored and Home Alone Looking For Some Fun - w4w – (ASK),” which had been posted under the “Casual Encounters” link on Craigslist. Over the next 24 hours, Galdamez engaged in email chats, phone calls, and text messages of a sexual nature with a person he believed to be a 14-year-old girl named Crystal. Subsequently, Galdamez drove to the location where he had arranged to meet Crystal. Once Galdamez arrived at the location, officers arrested him for attempted online enticement of a child.
As a result of the guilty verdict, Galdamez faces a sentence of ten years to life in prison, a fine of up to $250,000, not less than five years and up to a life term of supervised release, and a $100 special monetary assessment.
In announcing the verdict, Pamela C. Marsh, United States Attorney for the Northern District of Florida, credited the success of this prosecution to the joint efforts of the agencies participating in the North Florida ICAC, particularly U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the United States Marshals Service, Volusia County Sheriff’s Office, Florida Department of Law Enforcement, Leon County Sheriff’s Office, and the Tallahassee Police Department.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched by the Department of Justice in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney’s 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 exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was prosecuted by Assistant United States Attorney Herbert Lindsey.
El Paso, Texas Man Sentenced to Twenty Years in Federal Prison for Heroin Trafficking ConvictionRead the Press Release
ALBUQUERQUE –Francisco Burciaga, 43, of El Paso, Texas, was sentenced this morning to 20 years in federal prison followed by ten years of supervised release for his heroin trafficking conviction, announced Acting U.S. Attorney Steven C. Yarbrough, Joseph M. Arabit, Special Agent in Charge of the DEA’s El Paso Division, Chief Pete N. Kassetas of the New Mexico State Police and Chief Terry Sisneros of the Raton Police Department.
Burciaga was arrested in June 2008, after officers found 32 pounds of heroin secreted in his vehicle during a routine traffic stop in Colfax County, N.M. In July 2008, he was indicted and charged with possession of heroin with intent to distribute. A trial in Nov. 2010 ended in a mistrial and proceedings in the case were stayed during the pendency of an interlocutory appeal. The retrial of the case concluded on May 31, 2013, when the jury returned a guilty verdict against Burciaga on the sole count of the indictment.
According to the evidence at trial, on June 24, 2008, a New Mexico Motor Transportation Police officer executed a routine traffic stop of a vehicle driven by Burciaga on Interstate 25 just south of Raton, N.M. When the officer approached Burciaga, he provided a Texas driver’s license and documents reflecting that the vehicle was registered to him in Phoenix, Ariz., on June 23, 2008, and insured by him on that same day. After the officer explained the traffic violation he observed, Burciaga admitted the violation and agreed to pay the fine.
While talking with Burciaga, the officer noticed a strong chemical odor coming from the vehicle and an air freshener hanging from the vehicle’s rear-view mirror, which, together with the vehicle’s recent registration, triggered the officer’s suspicions. Accordingly, the officer asked Burciaga if he had anything illegal in the vehicle. Burciaga responded by opening the vehicle’s hatchback and saying, “Wanna take a look.” Shortly thereafter, a New Mexico State Police Officer arrived to assist and noticed fresh tool marks and spray paint on the underside of the vehicle and its back bumper area. The officers then had a narcotics dog inspect the vehicle and the dog reacted to the back bumper area of the vehicle.
When the officers removed the back bumper from Burciaga’s vehicle, they found a hidden compartment containing 24 sealed packages containing a white powdery substance. Subsequent laboratory analysis revealed that the packages contained 14.4 kilograms (32 pounds) of heroin that was 72% pure. The Chief of the Indications and Warnings Section of DEA’s Intelligence Division in Washington, D.C., who testified as an expert, told the jury that the heroin seized from Burciaga was one of the top ten DEA heroin seizures in the United States in 2008 in terms of weight. He also testified that, in Chicago, Ill., where Burciaga intended to deliver the heroin, the conservative retail, or street, value of the heroin in 2008 was at least $2,900,000.
Burciaga faced enhanced penalties in this case because he previously was convicted of a felony drug trafficking crime in a Texas state court in 1996.
This case was investigated by the Albuquerque office of the DEA, the New Mexico Motor Transportation Police, the New Mexico State Police and the Raton Police Department, with assistance from the New Mexico State Police, and was prosecuted by Assistant U.S. Attorneys Jon K. Stanford and C. Paige Messec.
Effingham County Man Sentenced on Gun Related ChargesRead the Press Release
An Effingham County man was sentenced on November 1, 2013, to federal prison on gun related charges, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today.
Ivan Joe Golladay, 33, of Effingham, IL, was sentenced to 96 months in prison, three years of supervised release following his imprisonment, and fined $200. Golladay had previously pleaded guilty to two counts in a federal indictment. Count 1 charged that on November 9, 2012, in Effingham County, Golladay was a convicted felon in possession of a .22 Caliber Revolver. Count 2 charged that on November 13, 2012, in Effingham County, Golladay was a convicted felon in possession of a 12 gauge shotgun.
The investigation in this case was conducted by the Effingham Police Department and the Bureau of Alcohol, Tobacco, and Firearms.
The case is being handled by Assistant United States Attorney George Norwood.
Eddie Bynum, Sr. Pleads Guilty to Money LaunderingRead the Press Release
Portland, Ore. — Eddie L. Bynum, Sr. (a/k/a “Fast Eddie”), 54, of Portland, Oregon, pled guilty to money laundering today in U.S. District Court. The Internal Revenue Service’s (IRS) Criminal Investigations Division initiated a “sting” money laundering investigation of Bynum after learning from the Federal Bureau of Investigation’s Metro Gang Task Force that Bynum might be laundering money for local gang members through his Vancouver automobile dealerships. Bynum is scheduled to be sentenced by U.S. District Court Judge Marco Hernandez on February 18, 2014.
Bynum pled guilty to one count of money laundering, and admitted that he accepted $34,000 in cash from an IRS undercover agent to purchase a 2005 Maserati, and that the agent told him that the cash came from dealing drugs. Bynum also admitted that he conducted the Maserati sale to conceal the source and nature of the dirty money. Bynum acknowledged he later accepted $50,000 cash from the undercover agent, pursuant to an agreement that Bynum would launder that money by returning the $50,000 to the agent in $5,000 monthly checks from one of his businesses. The government alleged that Fountaine Motors, Manor Highway Auto, Inc., JT’s Barber Shop, and Seeznin’s Sports Bar were among the local businesses Bynum used to launder money.
This case stemmed from an investigation by the Internal Revenue Service, Criminal Investigations. The case is being prosecuted by Assistant U.S. Attorney Stacie Beckerman.
Dollar General Armed Robbers SentencedRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Nyneson S. Jeudy, 21, and Jarrett J. Sutton, 22, both of Moultrie, Georgia, were sentenced on Monday, October 28, 2013, in Valdosta, Georgia by Senior United States District Judge Hugh Lawson for armed robbery of the Dollar General, a large multistate retailer, in Coolidge, Georgia. Mr. Jeudy was sentenced to serve one hundred forty-one (141) months imprisonment. Mr. Sutton was sentenced to serve seventy (70) months imprisonment. As part of the sentence, Mr. Jeudy and Mr. Sutton will each pay restitution to the Dollar General in the amount of $2,300.00 and a total of $47.00 to two employees of the store at the time of the robbery.In his plea of guilty, Mr. Jeudy admitted to carrying and pointing a firearm at employees when he entered the Dollar General on March 22, 2010. Although Mr. Sutton admitted to participating in the robbery of the store and the employees, he did not possess a firearm at the time of the robbery. The store’s videotape of the robbery confirmed Mr. Sutton’s statement and exposed that Mr. Jeudy was armed with both a rifle and a handgun.
“This case is another example of the senseless use of a firearm during a crime. The sentences imposed will give both Mr. Jeudy and Mr. Sutton a long time to think about what they did. When you use a gun in a crime, you can expect to spend a long, long time in prison,” said U.S. Attorney Michael Moore.
The case was investigated jointly by the Georgia Bureau of Investigation, the Thomas County Sheriff’s Office and the Coolidge, Georgia Police Department. Assistant United States Attorney Robert McCullers prosecuted the case for the Government.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Defendant Sentenced for Possession of Child PornographyRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Brandon Meredith Hardy, 23, Moody AFB, Georgia, was sentenced on Monday, October 28, 2013, by the Honorable Hugh Lawson, Senior United States District Judge, in Valdosta, Georgia, for possession of child pornography. Mr. Hardy was sentenced to serve 108 months imprisonment. Once Mr. Hardy is released from prison, he will be under supervision for 15 years and will be monitored as a registered sex offender.Mr. Hardy entered a plea of guilty on July 17, 2013, to one count of possession of child pornography. In his plea, Mr. Hardy admitted that in September 2010, during his time as an airman at Moody Air Force Base, he used a computer at the base to search for and download child pornography. As part of an undercover investigation, a federal search warrant was executed on Mr. Hardy’s room on November 4, 2010. During the search, agents located a computer and thumbdrive containing images of prepubescent minors and minors under the age of twelve (12) years engaged in sexual acts with adult males.
“Mr. Hardy caused the young children in these disgusting images to be re-victimized every time he looked at the pictures. Possessing child pornography is not a victimless crime, and the Department of Justice will use all of its resources to make sure that people like Mr. Hardy don’t have the opportunity to harm our children,” said United States Attorney Michael Moore.
The case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Robert D. McCullers.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Defendant Sentenced for Fraud by WireRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that John Dewey Morris, 70, of Coolidge, Georgia, was sentenced on Monday, October 28, 2013, by Senior United States District Judge Hugh Lawson, in Valdosta, Georgia, for wire fraud. Judge Lawson sentenced Mr. Morris to five (5) years probation and ordered him to pay $131,443.00 in total restitution to Progressive Insurance and Auto Owners Insurance.
Mr. Morris entered a plea of guilty on July 24, 2013, to one count of wire fraud. In his plea, Mr. Morris admitted that he caused false and fraudulent insurance claims to be filed on a truck and wood chipper owned by his companies Beeline Wood Products, Inc. and Big Bend Timber Services. Mr. Morris admitted that he knew the truck and wood chipper had not been stolen from a location in Thomas County, Georgia, but instead at his request, had been cut up and sold for parts and scrap metal.“When people defraud insurance companies, they end up hurting every honest policyholder by subjecting them to increased insurance rates to help offset the effect of the fraud,” said United States Attorney Michael Moore.
The case was investigated by the United States Secret Service along with the Thomas County Sheriff’s Office. The case was prosecuted by Assistant United States Attorney Robert D. McCullers.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Debt Collection Employee and Son-in-Law Sent to Prison for Identity Theft Tax SchemeRead the Press Release
Montgomery, Alabama - Quentin Collick of Montgomery, Ala., and Deatrice Williams of Duluth, Ga., were sentenced Nov. 1, 2013, to serve 85 and 51 months in prison, respectively, announced George L. Beck, Jr., U.S. Attorney for the Middle District of Alabama. Collick and Williams were previously found guilty by a jury in the Middle District of conspiring to file false claims, wire fraud, and aggravated identity theft. Collick was also convicted on three counts of theft of public funds. Corey Thompson, a co-conspirator, previously pleaded guilty and was sentenced to serve 30 months in jail.
Based on evidence introduced at trial and court filings, Williams worked for a debt collection company located in Norcross, Ga. As an employee, Williams had access to a database that stored names, social security numbers, and dates of birth of individuals who owed medical debts. Williams stole the identities of a number of these individuals and provided the information to Collick, her son-in-law.
Collick and Thompson used the stolen identities to file false tax returns and fraudulently claim tax refunds. In 2011 and 2012, Thompson worked as an independent contractor for a cable company installing cable and internet access for customers. To conceal the filing of the false tax returns, Thompson used his specialized knowledge and equipment to shut down and hijack his customers’ internet service, and along with Collick, filed false tax returns using the customers’ internet access, making it appear as if the false tax returns were being filed by the customers. Thompson and Collick then directed the tax refunds to be placed on pre-paid debit cards, which were mailed to Montgomery, Ala. However, those cards were intercepted by the U.S. Postal Service. Several tax refund checks were also mailed by the IRS, based upon the fraudulent returns, which Collick retrieved and cashed.
This case was investigated by special agents of IRS - Criminal Investigation and prosecuted by Tax Division Trial Attorneys Michael Boteler, Jason H. Poole and Alexander Effendi and Assistant U.S. Attorney Todd A. Brown.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617Dallas Man Sentenced to A Total of 240 Months in Federal Prison for Role in Heroin Distribution ConspiraciesRead the Press Release
DALLAS — Refugio Ramirez-Garcia, aka “Cuco,” “Refugio,” “Miguel,” and “Arturo Ramirez,” 35, of Dallas, was sentenced yesterday by U.S. District Judge Sam A. Lindsay to serve a total of 240 months in federal prison for his role in heroin distribution conspiracies that he operated in the Dallas-Fort Worth metroplex, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Ramirez-Garcia pleaded guilty in January 2013 to his role in both conspiracies. In one case, he admitted that he was involved in a conspiracy, in 2006 and 2007, with co-defendants, Martin Laguna, Francisco Laguna, Marco Antonio Romero, Jaun Curz Puerto and Timothy Ryan Daniels, to distribute more than one kilogram of heroin. His co-defendants received sentences ranging from 15 months to 180 months in federal prison. In the other case, he admitted that from August 2010 to August 2012 he was involved in a conspiracy to distribute heroin. In fact, when he was arrested on August 8, 2012, he was in possession of approximately 10 ounces of black tar heroin.
During the course of the earlier conspiracy, Ramirez-Garcia distributed heroin to his co-defendants and other individuals. By way of example only, in late March 2006, officers with the Dallas Police Department executed a search warrant at Ramirez-Garcia’s apartment in Dallas and seized: 2,353 grams of black tar heroin; 3.6 grams of powder cocaine; $66,760 in cash and three digital scales. Ramirez-Garcia admitted the cash seized from his apartment was proceeds from heroin sales.
The cases were investigated by the Coppell, Dallas and Farmers Branch Police Departments, the Dallas Independent School District Police Department – Criminal Investigations Division and the Drug Enforcement Administration. Assistant U.S. Attorneys Keith Robinson and Aisha Saleem prosecuted.
Crownpoint Man Sentenced to Federal Prison for Involuntary Manslaughter ConvictionRead the Press Release
ALBUQUERQUE – Sampson Antonio, Jr., 25, an enrolled member of the Navajo Nation who resides in Crownpoint, N.M., was sentenced this afternoon to 30 months in federal prison followed by three years of supervised release for his involuntary manslaughter conviction. Antonio also was ordered to pay $4,077.05 in restitution to cover funeral costs for the victim.
Antonio was arrested in July 2012, on a criminal complaint charging him with involuntary manslaughter in connection with the death of a 19-year-old Navajo woman in Mariano Lake, N.M., on April 21, 2012. Antonio subsequently was indicted and charged with driving a vehicle while intoxicated and running over the victim and causing her death.
On April 30, 2013, Antonio pled guilty to the indictment and admitted killing the victim on April 21, 2012, while driving under the influence of alcohol and driving recklessly.This case was prosecuted by Assistant U.S. Attorneys Kyle T. Nayback and David M. Adams, and was investigated by the Crownpoint office of the Navajo Nation Division of Public Safety.
Claymont Man Charged with Distributing Child Pornography from Residence Used for In-Home DaycareRead the Press Release
WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Carl McBride, age 48, of Claymont, Delaware, was arrested earlier today and charged by criminal complaint with transportation of child pornography, in violation of Title 18, United States Code, Section 2252A(a). This federal criminal charge results from an online undercover operation in which McBride utilized a non-public, peer-to-peer computer network to distribute child pornography to over 100 individuals from his Claymont home.
If convicted of the charges, McBride faces a mandatory minimum sentence of at least five years, and up to twenty years, in prison, a fine of up to $250,000, and a term of supervised release of at least five years to life following his prison sentence. He also will be required to register as a sex offender in any jurisdiction in which he resides, works or attends school.
After identifying McBride through computer network records, investigators discovered that another person residing at his Claymont residence has been providing daycare services out of the home for at least three years under the name “Little Tykes Day Care.” The Office of Child Care Licensing suspended the operator’s license today.
Early this morning, law enforcement agents executed a federal search warrant at McBride’s residence, seizing multiple computers, cell phones, cameras and other digital equipment. In particular, agents seized a laptop computer found next to a diaper changing table in a room used for daycare services. A forensic preview of that laptop revealed hundreds of images and movies of child pornography depicting prepubescent females engaged in sex acts. In a number of the images, the young children are bound and violently assaulted by adult males.
McBride was arrested by U.S. Homeland Security special agents, and made his initial appearance in United States District Court this afternoon. McBride waived his rights to a preliminary and detention hearing, and will remain in custody pending further proceedings.
Any person possessing information about this matter are encouraged to contact the United States Department of Homeland Security’s Tip Line at 302-428-0104, extension 3.
The case is being prosecuted by Assistant United States Attorney Edward J. McAndrew and investigated by the Delaware State Police and the United States Department of Homeland Security, Homeland Security Investigations.
The charge in the Complaint is only an allegation and the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Clay County Man Sentenced on Methamphetamine Related ChargesRead the Press Release
A Clay County man was sentenced on October 31, 2013, to federal prison on methamphetamine related charges, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today.
Derek L. Cosner, 32, of Mason, IL, was sentenced to 170 months in prison, four years supervised release following his imprisonment, and fined $500. Cosner had previously pleaded guilty to two counts in a federal indictment. Count 1 charged that from February 2011, until on or about February 7, 2013, in Clay County, Cosner conspired with others known and unknown to the grand jury to manufacture more than 50 grams of methamphetamine. Count 2 charged that from February 1-7, 2013, Cosner knowingly and intentionally possessed equipment, chemicals, products, or materials, knowing the items would be used to manufacture methamphetamine.
The investigation in this case was conducted by the Flora Police Department, the Clay County Sheriff’s Office, and the Southeastern Illinois Drug Task Force.
The case is being handled by Assistant United States Attorney George Norwood.
California Man Sentenced to Ten Years for Heroin Trafficking ConvictionRead the Press Release
ALBUQUEQUE – Louie Villegas, 49, of Palm Springs, Calif., was sentenced this afternoon to ten years in federal prison followed by five years of supervised release for his heroin trafficking conviction.
Villegas was arrested on April 18, 2013, at the Greyhound Bus Station in Albuquerque, N.M., after DEA agents found more than a kilogram of heroin concealed in inside the inner soles of his tennis shoes. He subsequently was indicted and charged with possession of heroin with intent to distribute.
Villegas entered a guilty plea to the indictment on Aug. 5, 2013. Villegas admitted that, while at the Greyhound bus station in Albuquerque on April 18, 2013, he had a consensual encounter with DEA agents and gave the agents permission to search him and his shoes for contraband. When Villegas handed his left shoe to the agents, it was abnormally heavy. Inside the inner sole of both shoes, the agents found approximately 1.3 kilograms of heroin.
This case was investigated by the Interdiction Unit of the Albuquerque office of the DEA and was prosecuted by Assistant U.S. Attorney Lynn W.Y. Wang.
California Man Arraigned on Multi-Million Dollar Fraud ScamRead the Press Release
BOSTON – A California man was arraigned yesterday after being indicted for defrauding a number of borrowers looking for multi-million dollar financing.
Damien Hess, a/k/a John Hess, 36, the former Chief Executive Officer of Quest Capital Finance (Quest), was arraigned yesterday after being indicted for wire fraud and conspiracy.
The indictment alleges that between 2008 and 2012, Hess and his co-defendant, Lucas Ford, falsely represented that Quest was a financing company with hundreds of millions of dollars to lend to prospective borrowers. Hess and Ford told these borrowers that in order to close on these loans, the borrowers first needed to put hundreds of thousands of dollars into escrow accounts that would be held by a third party until all contingencies for the financing were resolved. Contrary to explicit statements contained in the escrow agreements, prior to all contingencies being resolved and without providing any financing for the prospective borrowers, Ford and Hess took all or most of the escrowed money and transferred it to their company. Those stolen funds were later transferred to other business and personal accounts and used for personal expenses, such as plastic surgery and trips to Disneyland. When the deadlines for the various loan closings passed and borrowers asked where their loans were, Hess and Ford made false representations that the financing would be available shortly and provided a series of false excuses to explain why the funding was not yet ready. In total, Hess and Ford took into Quest over $2.8 million worth of borrower deposits and never provided any financing.
If convicted, the maximum sentence under the statute is 20 years in prison for the wire fraud counts, three years of supervised release and a fine of the greater of $250,000 per count or twice the gross loss or gain resulting from the offense.
United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Rafael A. Medina, Special Agent in of the U.S. Postal Service, Office of Inspector General, Northeast Area Office, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Sara Miron Bloom and Patrick M. Callahan of Ortiz’s Office.
The details contained in the Indictment are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Benton Attorney Pleads Guilty to Federal Drug Conspiracy - Related ChargeRead the Press Release
Agrees to permanently surrender law license at sentencing
Little Rock - Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas announced Dustin Dyer, of Benton, pled guilty before United States District Judge James M. Moody to the use of a cell phone to facilitate the commission of an offense of conspiracy to possess with intent to deliver methamphetamine.
Dustin Dyer was originally indicted in June 2011, in an Indictment returned against 19 individuals involved in a methamphetamine trafficking organization led by Daniel Henry of Cabot, Arkansas. Dyer was charged with one count of using a telephone to facilitate the distribution of methamphetamine by a member of the Henry conspiracy. The case against Dyer was severed from the other defendants in October, 2012 and the other defendants resolved their cases through pleas or trial. On July 11, 2013, a Third Superseding Indictment was returned against Dyer which charged Dyer with being involved in a conspiracy to distribute methamphetamine, use of a telephone to facilitate the conspiracy, and witness tampering.
Today, Dyer pled guilty to Count 18 of the Third Superseding Indictment which charged use of a telephone to facilitate the drug conspiracy. In entering his plea, Mr. Dyer admitted that on December 20, 2010, he sent a series of text messages to a client who he knew to be involved in a conspiracy to distribute methamphetamine. His intent was to assist the client in obtaining methamphetamine for distribution to him and to others. Upon acceptance by Judge Moody of Dyer’s guilty plea, the United States moved to dismiss Count 1-Conspiracy to distribute methamphetamine and Count 19-Witness tampering.
Under the plea agreement reached by the parties, Dyer agreed to permanently surrender his law license at the time of sentencing. The United States agreed to recommend a sentence of probation for Dyer. The Court is not bound to the recommended sentence. If the Court does not follow the recommended sentence, Dyer will have the option to withdraw his guilty plea.
This investigation was conducted by the Drug Enforcement Administration lead High Intensity Drug Trafficking Area Task Force consisting of local, state and federal law enforcement agencies Substantial support in the Dyer investigation was provided by the Benton Police Department. Assistant United States Attorney Anne Gardner is prosecuting this case for the United States.
Alabama Husband and Wife Plead Guilty to Identity Theft SchemeRead the Press Release
Mary Young and Christian Young each pleaded guilty yesterday to one count of conspiracy to defraud the United States and one count of aggravated identity theft for their role in a stolen identity refund fraud (SIRF) scheme , announced Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division and U.S. Attorney for the Middle District of Alabama George L. Beck Jr.
According to court documents, between January 2010 and June 2012, Mary Young, Christian Young, Octavious Reeves and others obtained stolen identities from individuals and used those stolen identities to file false tax returns. The false tax returns were filed from the Youngs’ residence and the conspirators directed the false tax refunds to prepaid debit cards in the names of the identity theft victims. The Youngs and others used the prepaid debit cards to withdraw the fraudulent proceeds, which allegedly totaled over $400,000.
Sentencing has not yet been scheduled. The Youngs each face a minimum sentence of two years imprisonment with a maximum of twelve years, as well as three years of supervised release, restitution and a maximum fine of $250,000, or twice the loss caused by the offense. Reeves previously pleaded guilty and will be sentenced on Feb. 19, 2013.
The case was investigated by Special Agents of the IRS - Criminal Investigation. Trial Attorneys Michael Boteler, Charles Edgar Jr. and Gregory Bailey of the Department’s Tax Division and Assistant U.S. Attorney Todd Brown are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
Alabama Husband and Wife Use an Identity Theft Scheme Used to Fund Their Gambling ActivitiesRead the Press Release
Montgomery, Alabama - Mary Young, 48 years old, and Christian Young, 49 years old, both of Wetumpka, each pleaded guilty yesterday to one count of conspiracy to defraud the United States and one count of aggravated identity theft for their role in a Stolen Identity Refund Fraud (“SIRF”) scheme, announced George L. Beck, Jr., U.S. Attorney for the Middle District of Alabama.
According to court documents, between January 2010 and June 2012, Mary Young, Christian Young, Octavious Reeves, and others obtained stolen identities from individuals and used those stolen identities to file false tax returns. The false returns were filed from the Young’s residence and the conspirators directed the unlawful refunds to prepaid debit cards in the names of the identity theft victims. Mary Young, Christian Young, and others used the prepaid debit cards to withdraw the fraudulent proceeds.
In total, the scheme generated over $400,000 in fraudulent tax refunds. Mary Young and Christian Young used a substantial amount of the illicit proceeds to fund their gambling activities. Between 2010 and 2012, the Youngs lost nearly $200,000 at casinos in Alabama.
Sentencing has not yet been scheduled. Mary Young and Christian Young both face a minimum sentence of two years and a maximum of twelve years in prison, along with three years of supervised release, restitution, and a maximum fine of $250,000 or twice the loss caused by the offense. Reeves previously pleaded guilty and will be sentenced on February 19, 2014.
The case was investigated by Special Agents of the IRS - Criminal Investigation. Trial Attorneys Michael Boteler, Charles Edgar, Jr., and Gregory Bailey of the Justice Department’s Tax Division and Assistant U.S. Attorney Todd Brown are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at justice.gov/tax.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617
Monday 4 November 2013
Woman Convicted at Trial for Role in Nearly $3 Million Health Care Fraud Scheme Involving the Operation of Euless Healthcare Corp. Is Sentenced to 72 Months in Federal PrisonRead the Press Release
Defendant Also Ordered to Pay $830,000 in Restitution
DALLAS — Comfort Gates, 48, was sentenced this afternoon, by U.S District Judge David C. Godbey, to 72 months in federal prison and ordered to pay $830,000 in restitution following her conviction at trial in April 2013 on charges stemming from her involvement in the operation of Euless Healthcare Corporation (EHC) and Medic Healthcare Incorporated (Medic). Gates is one six defendants convicted in the conspiracy. Judge Godbey ordered that Gates, a current resident of Houston, surrender to the Bureau of Prisons on January 13, 2014. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Gates, an employee of Medic, and coconspirator Godwin Umotong, 58, an employee of EHC and Medic, were each convicted at trial on one count of conspiracy to commit health care fraud. Gates was also convicted on two counts of health care fraud and Umotong was also convicted on five counts of health care fraud. Umotong is scheduled to be sentenced on December 2, 2013; he faces a maximum statutory penalty of 10 years in federal prison and a $250,000 fine on each of the counts of conviction. He could also be ordered to pay restitution.
Other defendants in the case who have been convicted and sentenced are listed below. Each was also ordered to pay restitution of amounts ranging from approximately $195,000 to $1.4 million.
Ovsanna Agopian, 58, Houston, 120 months in federal prison
Boghos Babadjanian, 55, of Sherman Oaks, Calif., probation
Leslie Omagbemi, 56, of Dallas, 30 months in federal prison
Munda Massaquoi, 69, of Houston, 37 months in federal prison
ECH was located on West Bedford Euless Road in Hurst Texas, and Medic, which operated from October 2009 to May 2011, was located on Bonhomme Road in Houston. Agopian, 58, was the operator of both EHC and Medic.
According to documents filed in the case and evidence presented at trial, Agopian, Umotong, Omagbemi, Massaquoi and Gates conspired together to submit, or cause to be submitted, fraudulent claims to Medicare for diagnostic tests and office visits. Agopian recruited unlicensed doctors to work for EHC and Medic by telling them that they would treat beneficiaries in the beneficiaries’ homes. Medicare does not pay for services performed by unlicensed persons. Nevertheless, these recruits went to beneficiaries’ homes and purported to conduct medical examinations, including ordering diagnostic tests. In total, more than $2.7 million was fraudulently billed, and of that amount, Medicare paid more than $1.3 million.
The case was investigated by the Dallas Health Care Fraud Prevention and Enforcement Action Team (HEAT) Strike Force, which includes the U.S. Department of Health and Human Services - Office of Inspector General (HHS-OIG), the FBI and the Texas Attorney General’s Medicaid Fraud Control Unit. Assistant U.S. Attorney Michael Elliott prosecuted.
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, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the HEAT Strike Force, go to: www.stopmedicarefraud.gov.
Williamson County Man Charged with Firearm OffenseRead the Press Release
On October 31, 2013, Sherman L. Allen, Jr., a/k/a “Larue,” 29, of Marion, IL, was arraigned in federal court in Benton, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Allen was charged by indictment, on October 23, 2013, with Possession of a Firearm by a Felon. At the October 31, 2013, court hearing, Allen was ordered held without bond pending a December 30, 2013, jury trial.
The offense occurred on July 29, 2013, in Marion, Williamson County. The firearm offense carries a penalty of up to 10 years in prison, to be followed by 3 years supervised release, and a fine of up to $250,000.
Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The investigation was conducted by the Southern Illinois Enforcement Group and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Illinois State Police Special Weapons and Tactics Team and Williamson County State’s Attorney’s Office also assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Uniontown Man Illegally Possessed RevolverRead the Press Release
PITTSBURGH - A resident of Uniontown, Pa., pleaded guilty in federal court to a charge of violating federal firearms laws, United States Attorney David J. Hickton announced today.
William Kent Bricker, 56 pleaded guilty to one count before United States District Judge Mark R. Hornak.
In connection with the guilty plea, the court was advised that on or about Sept. 2, 2012, Bricker, being a convicted felon, illegally possessed a .32 caliber revolver. Bricker was convicted of armed bank robbery in 1993 and illegal firearms possession in 2004. Federal law prohibits anyone who has been convicted of a crime punishable by a term of imprisonment exceeding one year to possess a firearm.
Judge Hornak scheduled sentencing for Feb. 26, 2014 at 9:30 a.m. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.
Assistant United States Attorney Charles A. Eberle is prosecuting this case on behalf of the government.
The Pennsylvania State Police, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Federal Bureau of Investigation conducted the investigation that led to the prosecution of William Kent Bricker. This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime.
Two Plead Guilty in Connection with Sunshine Pharmacy Health Care Fraud SchemeRead the Press Release
Fort Myers, Florida – Acting United States Attorney A. Lee Bentley, III announces that Delmer Holmes Parrish (44) and Patricia Parrish (74), both of Naples, today pleaded guilty to conspiracy to commit health care fraud. Delmer Holmes Parrish, a licensed pharmacist, and Patricia Parrish each face a maximum penalty of ten years in federal prison. In addition, they have agreed to pay restitution to the United States in the amount of $351,358.14. As part of the agreement, Delmer Holmes Parrish has also agreed to voluntarily relinquish his pharmacist license to the State of Florida. A sentencing date has not yet been set.
According to the plea agreement, from in or around February 2009 through in or about July 2012, Delmer Holmes Parrish and Patricia Parrish participated in a conspiracy to defraud federal health care benefit programs out of approximately $351,358.14. Along with others, both used Sunshine Pharmacy and Sunshine Solutions to submit and cause claims to be submitted for reimbursement from Medicaid, Medicare, and TRICARE programs for prescriptions not filled or provided to beneficiaries and recipients. The claims included prescriptions for patients that had not been written or authorized by any duly licensed physician. In addition, the co-conspirators submitted and caused claims to be submitted for reimbursement from these same programs for beneficiaries and recipients who were deceased.
In carrying out the offense, the conspirators also used the means of identification of individuals who were enrolled in the Medicaid, Medicare, or TRICARE programs, without their knowledge or consent. The members of the conspiracy also would and did perform acts and made statements to hide and conceal the scheme. As a result of the fraudulent scheme, the government’s losses totaled approximately $351,358.14.
This case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General; Department of Defense, Defense Criminal Investigative Service; and the Drug Enforcement Administration. They were assisted by the Naples Police Department, Collier County Sheriff's Office, and the U.S. Secret Service. It is being prosecuted by Assistant United States Attorney David G. Lazarus.
Two Florida Residents Arrested inConnection with International Lottery ScamRead the Press Release
Two individuals charged in connection with the operation of a fraudulent lottery scheme were arrested today in south Florida following their indictment by a federal grand jury in Miami on Oct. 31, 2013, the Justice Department, U.S. Postal Inspection Service, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the U.S. Marshals Service announced. Althea Angela Peart and Charmaine Anne King were arrested on charges that they and their co-conspirators, some of whom operated from outside of the U.S., participated in a fraudulent lottery scheme. As alleged in the indictment, co-conspirators induced elderly victims in the U.S. to send thousands of dollars to Peart and King to cover fees for lottery winnings that victims had not won. The indictment, unsealed with Peart’s and King’s arrests, is part of the government’s crackdown on fraudulent international lottery schemes.
“Operators of foreign lottery schemes often cannot succeed without the assistance of co-conspirators in the United States,” said Stuart F. Delery, Assistant Attorney General for the Justice Department’s Civil Division. “These schemes can cause devastating financial harm to their victims, and the Department of Justice is committed to prosecuting those who engage in this criminal activity.”
From March 2012, Peart’s and King’s co-conspirators are alleged to have contacted victims in the U.S. and falsely informed them that they had won more than a million dollars in a lottery. According to the indictment, the co-conspirators sent letters to the victims from a purported sweepstakes company in the U.S. and included false and fraudulent cashier’s checks made out to the victims for thousands of dollars. As alleged in the indictment, these letters told victims to call “claims agents” who were actually co-conspirators, and when the victims called the purported claims agents, the agents informed the victims that they had to pay several thousand dollars in order to collect their purported lottery winnings. The claims agents allegedly told the victims to deposit the cashier’s checks in the victims’ bank accounts in order to purportedly cover the money they had to pay. The co-conspirators allegedly instructed the victims on how to send and wire this money to Peart and King.
The indictment charges that Peart and King each kept a percentage of the money they received from victims and sent the rest of the money to their co-conspirators. According to the indictment, because the cashier’s checks were false and fraudulent and had no value, any payments the victims sent to Peart and King were funded by their own money, and victims never received any lottery winnings.“As fraudsters from outside of the United States seek to take advantage of some of the most vulnerable in our community, they rely on co-conspirators in the United States for help,” said U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer. “As I have previously stated, we will continue to vigorously pursue and prosecute those responsible for these illegal schemes.”
Peart is charged with conspiracy, eight counts of mail fraud and three counts of wire fraud and with committing these offenses via telemarketing. King is charged with conspiracy, four counts of mail fraud and three counts of wire fraud and with committing these offenses via telemarketing.
“The U.S. Postal Inspection Service is committed to investigating fraudulent lottery schemes designed to defraud innocent victims,” said U.S. Postal Inspector in Charge in Miami Ronald Verrochio. “Combating international lottery fraud is a priority of the Postal Inspection Service given that a significant amount of the money in these frauds is sent through the U.S. mail. We are actively taking steps to educate Americans about the dangers of lottery frauds.”
“These arrests show that HSI is committed to stopping individuals who prey on our senior citizens,” said Special Agent in Charge of HSI Miami Alysa D. Erichs. “We will continue to work with our international partners and other law enforcement agencies to put an end to these criminal organizations.”
“The U.S. Marshals Service is proud to be part of the team bringing scam artists such as these to justice,” said Acting U.S. Marshal Neil DeSousa. “These international lottery scams that prey on our elderly cannot be allowed to continue. The arrests of these two perpetrators are a testament to federal law enforcement’s dedication to protecting our citizens against all types of crimes.”
Assistant Attorney General Delery and U.S. Attorney Ferrer commended the investigative efforts of the U.S. Postal Inspection Service, Homeland Security Investigations and the U.S. Marshals Service. The case is being prosecuted by Assistant Director Jeffrey Steger and Trial Attorney Kathryn Drenning with the Department of Justice’s Civil Division, Consumer Protection Branch.
An indictment is merely an allegation, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Two Florida Residents Arrested in Connection with International Lottery ScamRead the Press Release
Two individuals charged in connection with the operation of a fraudulent lottery scheme were arrested today in south Florida following their indictment by a federal grand jury in Miami on Oct. 31, 2013, the Justice Department, U.S. Postal Inspection Service, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the U.S. Marshals Service announced. Althea Angela Peart and Charmaine Anne King were arrested on charges that they and their co-conspirators, some of whom operated from outside of the U.S., participated in a fraudulent lottery scheme. As alleged in the indictment, co-conspirators induced elderly victims in the U.S. to send thousands of dollars to Peart and King to cover fees for lottery winnings that victims had not won. The indictment, unsealed with Peart’s and King’s arrests, is part of the government’s crackdown on fraudulent international lottery schemes.
“As fraudsters from outside of the United States seek to take advantage of some of the most vulnerable in our community, they rely on co-conspirators in the United States for help,” said U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer. “As I have previously stated, we will continue to vigorously pursue and prosecute those responsible for these illegal schemes.”
“Operators of foreign lottery schemes often cannot succeed without the assistance of co-conspirators in the United States,” said Stuart F. Delery, Assistant Attorney General for the Justice Department’s Civil Division. “These schemes can cause devastating financial harm to their victims, and the Department of Justice is committed to prosecuting those who engage in this criminal activity.”
From March 2012, Peart’s and King’s co-conspirators are alleged to have contacted victims in the U.S. and falsely informed them that they had won more than a million dollars in a lottery. According to the indictment, the co-conspirators sent letters to the victims from a purported sweepstakes company in the U.S. and included false and fraudulent cashier’s checks made out to the victims for thousands of dollars. As alleged in the indictment, these letters told victims to call “claims agents” who were actually co-conspirators, and when the victims called the purported claims agents, the agents informed the victims that they had to pay several thousand dollars in order to collect their purported lottery winnings. The claims agents allegedly told the victims to deposit the cashier’s checks in the victims’ bank accounts in order to purportedly cover the money they had to pay. The co-conspirators allegedly instructed the victims on how to send and wire this money to Peart and King.
The indictment charges that Peart and King each kept a percentage of the money they received from victims and sent the rest of the money to their co-conspirators. According to the indictment, because the cashier’s checks were false and fraudulent and had no value, any payments the victims sent to Peart and King were funded by their own money, and victims never received any lottery winnings.
Peart is charged with conspiracy, eight counts of mail fraud and three counts of wire fraud and with committing these offenses via telemarketing. King is charged with conspiracy, four counts of mail fraud and three counts of wire fraud and with committing these offenses via telemarketing.
“The U.S. Postal Inspection Service is committed to investigating fraudulent lottery schemes designed to defraud innocent victims,” said U.S. Postal Inspector in Charge in Miami Ronald Verrochio. “Combating international lottery fraud is a priority of the Postal Inspection Service given that a significant amount of the money in these frauds is sent through the U.S. mail. We are actively taking steps to educate Americans about the dangers of lottery frauds.”
“These arrests show that HSI is committed to stopping individuals who prey on our senior citizens,” said Special Agent in Charge of HSI Miami Alysa D. Erichs. “We will continue to work with our international partners and other law enforcement agencies to put an end to these criminal organizations.”
“The U.S. Marshals Service is proud to be part of the team bringing scam artists such as these to justice,” said Acting U.S. Marshal Neil DeSousa. “These international lottery scams that prey on our elderly cannot be allowed to continue. The arrests of these two perpetrators are a testament to federal law enforcement’s dedication to protecting our citizens against all types of crimes.”
U.S. Attorney Ferrer and Assistant Attorney General Delery commended the investigative efforts of the U.S. Postal Inspection Service, Homeland Security Investigations and the U.S. Marshals Service. The case is being prosecuted by Assistant Director Jeffrey Steger and Trial Attorney Kathryn Drenning with the Department of Justice’s Civil Division, Consumer Protection Branch.
An indictment is merely an allegation, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.
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.
Twin Falls Man Sentenced for Possessing Firearm with Obliterated Serial NumberRead the Press Release
BOISE – Brock Tyler Beutler, 24, of Twin Falls, Idaho, was sentenced today in United States District Court to seven months in prison for possession of a firearm with an obliterated serial number, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Edward J. Lodge also sentenced Beutler to serve three years of supervised release, with three months of home detention, 80 hours of community service, and forfeiture of the firearm he possessed. He pleaded guilty to the charge on August 14, 2013.
According to court documents, officers with the Twin Falls Police Department found a handgun with an obliterated serial number in Beutler’s waistband during a traffic stop on February 5, 2013. When asked about the obliterated serial number on the firearm, Beutler admitted to filing off the serial number so that it could not be traced. Beutler was also in possession of a small amount of methamphetamine.
The case was investigated by the Twin Falls Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Three Murphysboro Residents Charged with Drug OffensesRead the Press Release
On October 31, 2013, Maurice L. Robinson, a/k/a “Ray Ray,” 33, Jamie Kay Kelly, a/k/a “Jamie K.” and “Jamie K. Short,” 45, and Harold Lawayne Barron, a/k/a “Wayne,” 50, all of Murphysboro, were arraigned in federal court in Benton, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. On October 23, 2013, Robinson, Kelly, and Barron, were charged by indictment with Conspiracy to Distribute Crack Cocaine. Kelly and Barron were also charged with Conspiracy to Manufacture Methamphetamine. At the October 31, 2013, court hearing, all three were ordered held without bond pending a December 30, 2013, jury trial.
The crack cocaine offense occurred between May 2013, and September 2013, in Jackson County. The methamphetamine offense occurred between August 2012, and October 2013, in Jackson and Perry Counties. Both offenses carry penalties of up to 20 years in prison, to be followed by 3 years supervised release, and a fine of up to $1,000,000.
Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Southern Illinois Enforcement Group, Murphysboro Police Department, Illinois State Police, and the Drug Enforcement Administration. The Jackson County State’s Attorney’s Office assisted in the investigation.
The case is assigned to Assistant United States Attorney Amanda A. Robertson for prosecution.
Tax Return Preparer Found Guilty for Involvement in Stole Identity refund fraud schemeRead the Press Release
Tampa, Florida– Acting United States Attorney A. Lee Bentley, III announces that a federal jury has found Kenyon Lamont Williams guilty of conspiracy to defraud the United States, filing false claims with the United States, and wire fraud. In addition, Williams was found guilty on two counts of wire fraud and two counts of aggravated identity theft. He faces a maximum penalty of forty-nine years in federal prison. A sentencing hearing has been set for January 24, 2014.
Williams was first indicted on January 10, 2013. Subsequently, a grand jury returned a superseding indictment against him on April 18, 2013.
According to testimony and evidence presented at trial, Williams worked in San Diego, California as a certified tax return preparer. Between 2007 and 2010, he worked as a part-time seasonal tax preparer. Around the beginning of 2011, Williams opened his own tax preparation service, which he operated out of his residence.
On January 25, 2012, Williams called his friend and fellow tax return preparer, Alesia Spivey, who lived in Tampa, Florida, and discussed the 2012 tax season and Williams’ desire to maximize refund amounts for his clients. During this conversation, Williams solicited information from Spivey regarding methods used, in Tampa, to increase tax refunds. Spivey and Carlista Hawls explained to Williams that individuals in Tampa were using a particular interest income scheme to file bogus tax returns with the IRS. Spivey instructed Williams on how to fill out the tax returns by employing this interest income scheme.
During several subsequent telephone conversations, Williams, Spivey, and Hawls discussed the interest income scheme being employed by them. Between January 25 and July 19, 2012, Williams prepared 168 fraudulent tax returns for tax year 2011 using bogus interest income figures provided by Spivey and Hawls. In all, the 168 fraudulent tax returns accepted by the IRS requested approximately $670,513.00 in refunds, resulting in the payment of approximately $517,744.00 in tax refunds.
In addition, on March 2, 2012, Spivey and Hawls flew to San Diego, California to meet with Williams. During that trip, Williams provided Spivey and Hawls with a list of names, dates of birth, and social security numbers, including a stack of Navy blood donor records, to be used in preparing fraudulent tax returns in Tampa.
Spivey pleaded guilty to her role in the scheme in January 2013. For her involvement in the scheme, Hawls pleaded guilty in February 2013. Both are currently scheduled to be sentenced in December 2013.
This case was investigated by the Internal Revenue Service – Criminal Investigation. It is being prosecuted by Assistant United States Attorneys Simon Gaugush and Adam Saltzman.
Supporting Documents: U.S. V. S.A.C. Capital Advisors, LP, S.A.C. Capital Advisors LLC, CR Intrinsic Investors, LLC, and Sigma Capital Management, LLCRead the Press Release
U.S. v. SAC Capital Advisors, LP, et al. Indictment
U.S. v. SAC Capital Advisors, LP, et al. Complaint - 13 Civ 5182
U.S. v. SAC Capital Advisors, LP, et al. Change of Plea Order
U.S. v. SAC Capital Advisors LP, et al. Cover Ltr, Plea Agt, and StipSt. Louis Man Sentenced for Failure to Register as A Sex OffenderRead the Press Release
David M. Hightower, a 23-year old, St. Louis, Missouri, man was sentenced on November 4, 2013, in federal district court in East St. Louis, Illinois, on one count of failure to register as a sex offender, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Hightower was sentenced to 18 months in prison, five years of supervised release, ordered to pay $100 special assessment and a $200 fine.
The violation occurred between July 14, 2009, and February 22, 2013. Hightower was required to register as a sex offender under both Illinois law and the Sex Offender Registration and Notification Act because he was convicted of Aggravated Criminal Sexual Abuse on September 16, 2005, in Madison County, Illinois.
Hightower signed an Illinois Sex Offender Registration Act Form on July 13, 2009, acknowledging he understood the conditions of maintaining his sex offender registration. It was discovered during an interview by a law enforcement officer on February 12, 2013, in St. Louis, Missouri, in relation to another charge that an active warrant was in effect in Madison County, Illinois, for his failure to register as a sex offender. Hightower admitted living in Missouri when the violation occurred, and not having registered as a sex offender in Missouri until February 23, 2013.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who 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.”
The case was investigated by the United States Marshals Service and prosecuted by Assistant United States Attorney Daniel T. Kapsak.
Snohomish County Woman who led Gun Trafficking Conspiracy Pleads Guilty to Gun and Drug ChargesRead the Press Release
A 34-year-old woman from Marysville, Washington, pleaded guilty today in U.S. District Court in Seattle to unlawful dealing in firearms, being a felon in possession of a firearm and distribution of methamphetamine, announced U.S. Attorney Jenny A. Durkan. HEATHER CHANCEY, a/k/a HEATHER LEE SLATER, was the leader of a group of four people indicted in July 2013, following an undercover investigation. Under the terms of the plea agreement, both sides will recommend between seven and ten years in prison when CHANCEY is sentenced by U.S. District Judge James L. Robart on February 3, 2014. The judge is not bound by the recommendation and can impose any sentence up to forty years allowed by law.
According to the indictment, on multiple occasions between October 2012 and January 2013, HEATHER CHANCEY and her coconspirators sold guns to an undercover law enforcement agent. Most of the sales occurred in the parking lot of the Tulalip Resort Casino in Marysville, Washington. Some of the sales occurred in other parking lots of businesses in Marysville or Arlington, Washington or at a Marysville residence. CHANCEY was prohibited from possessing firearms because of a 2001 conviction for methamphetamine possession. Some of the guns she possessed and sold in this case include: two sawed off shotguns and 13 regular shotguns – some with no visible serial numbers; 21 rifles – some with obliterated serial numbers; and four handguns. In her plea agreement, CHANCEY admits making the sales or brokering the deals between the undercover officer and her coconspirators. CHANCEY also admits an October 1, 2012 attempt to sell methamphetamine to the undercover officer at the same time she was selling him a firearm.
This investigation was conducted by the Snohomish Regional Gang and Drug Task Force, the Seattle Police Department, and the FBI. During the investigation, those agencies were assisted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Snohomish County Violent Offender Task Force and the United States Marshal’s Violent Offender Task Force. The case is being prosecuted by Assistant United States Attorney Kate Crisham.
San Diego Cfo Sentenced for Embezzling over $1 Million to Fund Fledgling Professional Football LeagueRead the Press Release
United States Attorney Laura E. Duffy announced that Jaime Cuadra, the former Chief Financial Officer of Oceanic Enterprises, Inc., was sentenced today by United States District Judge Marilyn L. Huff to serve 41 months in custody based on his conviction of wire fraud and filing a false federal income tax return. The charges stemmed from Cuadra’s embezzlement of $1,089,813.26 from Oceanic and its parent company, Umami Sustainable Seafood, Inc., a San Diego-based, publically traded company. Judge Huff also ordered Cuadra to pay back the $1,089,813.26 stolen from Umami and to pay $387,347.58 in back taxes to the Internal Revenue Service.
According to court documents, Cuadra embezzled the money from 2010 to 2013, by taking advantage of his access to one of Oceanic’s business accounts as the company’s CFO. In his guilty plea, Cuadra admitted that he carried out the scheme, in part, by falsifying Oceanic’s financial records by coding illicit transfers and expenditures as legitimate business expenses.
Court records show that during the period of the fraud, Cuadra not only served as Oceanic’s CFO, but also as the President and CEO of a fledgling football league. As a result of this conviction, Cuadra resigned from both organizations. Cuadra converted Oceanic’s funds to financially support the football league as well as for his personal benefit. Specifically, Cuadra used stolen funds to develop the football league and attract investors by paying league executives, as well as the league’s marketing, consulting, and public relations fees. For example, Cuadra directed over $200,000 to a woman who served as the league’s Chief Marketing Officer and Executive Vice President at the time. Cuadra’s use of embezzled funds for his personal expenditures included: (1) support for other outside business ventures (including a T-shirt business); (2) leasing a Porsche Cayenne; (3) travel, hotels, and meals; (4) a variety of miscellaneous purchases, including artwork, designer clothing, computers and entertainment systems, and tickets to sporting events; and (5) transfers to several personal accounts.
Court documents also described Cuadra’s falsification of his tax returns during the years in which he defrauded Oceanic and Umami. In particular, Cuadra failed to report his embezzled income on his 2010, 2011, and 2012 federal tax returns. And, in one instance, he wrote off an expense he had paid with embezzled funds as a “partnership loss,” which further reduced his adjusted gross income. In his guilty plea, Cuadra admitted that his false tax returns resulted in a cumulative tax loss of $387,347.58.
United States Attorney Laura E. Duffy praised the hard work of the agents from the Federal Bureau of Investigation and the Internal Revenue Service and reiterated her support of financial-crime prosecutions: "Mr. Cuadra’s brazen theft of corporate funds from one of our local companies was born from base motives – ego and greed. Such crimes shake the foundations of our businesses and cause investors to lose confidence in the markets. Our office will forge ahead with our commitment to investigate and prosecute this sort of fraud wherever it may occur.”
FBI Special Agent in Charge, Daphne Hearn, commented, "This case is about greed and taking advantage of a position of trust. Mr. Cuadra betrayed the trust of the company's investors and then tried to cover it up by falsifying corporate financial records. Today's sentencing should send a clear message that the FBI will continue to work with the U.S. Attorney's Office and our law enforcement partners to protect the American public from insider corporate fraud."
“Jaime Cuadra used his position of trust as the CFO of Oceanic Enterprises and Umami Sustainable Seafood to defraud them of over $1 million and failed to report his embezzled funds to the Internal Revenue Service,” said Joel P. Garland, IRS Criminal Investigation Acting Special Agent in Charge, Los Angeles Field Office. “Cuadra’s crimes caused a tax loss of more than $387,000. As a result, his future includes a period of imprisonment, being branded a convicted felon for the rest of his life, and paying restitution for all the taxes owed (plus penalties and interest). Today's sentencing of Jaime Cuadra emphasizes IRS Criminal Investigation’s aggressive pursuit of those who methodically use their position of trust to commit tax crimes for their own personal benefit."
DEFENDANT Criminal Case No. 13CR2298-H Jaime Cuadra SUMMARY OF CHARGESCount 1: Title 18, United States Code, Section 1343 B Wire Fraud
INVESTIGATING AGENCIES
Count 2: Title 26, United States Code, Section 7206(1) B Filing a False Federal Income Tax ReturnFederal Bureau of Investigation
Internal Revenue ServiceRemoved Alien Sentenced to Time Served for Illegally Re-entering United StatesRead the Press Release
PITTSBURGH – An illegal alien found in Washington, Pennsylvania, has been sentenced in federal court to a sentence of time served on his conviction of re-entry into the United States after deportation, United States Attorney David J. Hickton announced today.
United States District Judge David S. Cercone imposed the sentence on Rigoberto Gonzalez- Pedro, 27, formerly from Mexico, as sole defendant.
According to information presented to the Court, Gonzalez-Pedro, an alien, was removed from the United States by United States Immigration and Customs Enforcement on December 2, 2008. Gonzalez-Pedro was found in Washington, Pennsylvania by the United States Immigration and Customs Enforcement on February 5, 2013.
Assistant United States Attorney Shardul S. Desai prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Immigration and Customs Enforcement for the investigation leading to the successful prosecution of Gonzalez-Pedro.
Remaining Five Quarter Horses Allegedly Part of Los Zetas Money Laundering Operation Sold for Approximately $3.1 MillionRead the Press Release
Tempting Dash Sold For Record $1.7 Million
The remaining five quarter horses along with four embryos, part of more than 400 seized by federal authorities in June 2012 in connection with an alleged Los Zetas money laundering operation, have been sold for approximately $3.1 million, including Tempting Dash which sold for a record $1.7 million, announced United States Attorney Robert Pitman and Internal Revenue Service Criminal Investigation Special Agent in Charge Steve McCollough.
The horses, which were sold Friday, November 1, 2013, at Heritage Place Auction Facility in Oklahoma City, OK, included Tempting Dash, winner of the Dash for Cash at Lone Star Park race track in Grand Prairie, Texas, on October 24, 2009; Mr. Piloto, $1 million All American Futurity winner at Ruidoso Downs on Labor Day, 2010; Do Not Tempt Me, Dashin Follies; and, Separate Fire.
United States Attorney Robert Pitman noted that the proceeds from the sale of the quarter horses, totaling close to $12 million, will be held in escrow pending a final forfeiture action. Court documents allege that the horses were bought by and for members of the Los Zetas drug cartel with proceeds from narcotics trafficking.
“Like all criminal organizations, the Zetas are motivated by money. Identifying and taking their assets is an important way to lay an axe to the root of the tree. The forfeiture of these assets would represent a major step in our efforts to interrupt the cartel’s activity within this country,” stated United States Attorney Pitman. “It's always an added bonus when we are able to make the cartels effectively pay the costs of their own prosecutions.”
“This investigation has helped to disrupt this alleged international drug cartel’s U.S.-based money laundering operations and demonstrates the lengths that US law enforcement will go to deprive criminal organizations of the fruits of their illegal activities,” stated IRS-CI Special Agent in Charge Steve McCullough.
The sale of the horses is being made as a result of a court order in U.S. v. Miguel Angel Trevino Morales, et al. (WDTX case number A12cr210) and in accordance with industry practices.
Ramsey Man Pleads Guilty to Health Care FraudRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that on October 31, 2013, William Dale Sidener, 31, of Ramsey, Illinois, pled guilty to a one-count indictment charging that he engaged in a scheme to commit health care fraud. Sentencing has been set for March 7, 2014, in United States District Court in East St. Louis, Illinois. Sidener will face up to 10 years in prison, a fine of up to $250,000, and up to 3 years of supervised release.
During his plea hearing, Sidener admitted that he had submitted false and fraudulent bills in relation to his alleged performance of personal assistant services in the Home Services Program, a Medicaid Waiver Program designed to allow individuals to stay in their homes instead of entering a nursing home. Sidener admitted to falsely billing the program between November 2012 and February 2013, when he moved away from the person for whom he was supposed to be caring. As a result, Sidener improperly received $4,677.00 in payments for services not performed.
The investigation was conducted by the U.S. Department of Health and Human Services, Office of Inspector General and the Illinois State Police’s Medicaid Fraud Control Bureau. The case is being prosecuted by Assistant United States Attorney William E. Coonan.
If you suspect or know of an individual or company that is not complying with healthcare laws or public aid programs, you may report this activity to the local office of the U.S. Department of Health and Human Services, Office of Inspector General, or you may call 800.447.8477.
Pharmacist Sentenced for DistributingMisbranded Drug for Kidney Dialysis PatientsRead the Press Release
TOPEKA, KAN. – A pharmacist has been sentenced to 48 months in federal prison for substituting a cheaper drug imported from China for the iron sucrose that the Federal Drug Administration has approved for kidney dialysis patients, U.S. Attorney Barry Grissom said today. He also was ordered to pay restitution of $848,504 and a $25,000 criminal fine, in addition to forfeiting $425,000 in cash.
Robert Harshbarger, Jr., 53, Kingsport, Tenn., who was doing business as American Inhalation Medication Specialists, Inc., pleaded guilty to one count of distributing a misbranded drug and one count of health care fraud. In his plea, he admitted that as a result of the fraud kidney dialysis patients treated by Kansas Dialysis Services, L.C., received iron sucrose that had not been certified by the FDA to meet quality and safety standards.Although there were no reports of harm to patients, the crime put patients at risk because the FDA cannot assure the safety and effectiveness of products that are not FDA approved and come from unknown sources or foreign locations.
Harshbarger admitted that health care benefit programs paid more than $848,000 for the misbranded iron sucrose he distributed from 2004 to 2009. Harshbarger misrepresented the iron sucrose drug as Venofer, which is the only iron sucrose drug approved by the FDA for both pre-dialysis and post-dialysis patients.
Harshbarger purchased iron sucrose from Chinese companies including Qingdao Shenbang Chemical Company in Qingdao, China, and Shanghai Rory Fine Chemicals Co., Ltd., in Shanghai, China. The iron sucrose from China was cheaper than purchasing Venofer.
Grissom commended the Food and Drug Administration, the Dept. of Health and Human Services, Office of Inspector General, and Assistant U.S. Attorney Tanya Treadway for their work on the case.Orange County Resident Pleads Guilty to Theft of Government Property from the Department of Veterans AffairsRead the Press Release
Served as a Fiduciary for Disabled VeteranGREENSBORO, N.C. –A Rougemont, North Carolina, man pleaded guilty today in federal court to theft of government property, announced United States Attorney Ripley Rand.
BASIL D. HALLIDAY, age 51, pleaded guilty before United States Disrrict Judge Catherine C. Eagles to theft of government property in connection with his role as fiduciary for a relative who was a disabled veteran. A fiduciary is a guardian appointed by the Secretary of the Department of Veterans Affairs to use funds provided by the Department of Veterans Affairs for the benefit of a veteran. Halliday became a fiduciary for the veteran on March 21, 2007. The Indictment in this case indicates that, from June 1, 2007, until on or about July 30, 2010, Halliday stole approximately $44,000.00 in funds provided by the Department of Veterans Affairs solely for the intended benefit of the disabled veteran.
The defendant faces a maximum penalty of ten years confinement. The plea agreement also requires the defendant to make restitution to the Department of Veterans Affairs. Sentencing will occur in Greensboro on February 27, 2014, before Senior United States District Judge N. Carlton Tilley, Jr.
The case was investigated by the Department of Veterans Affairs, Office of Inspector General. The case is being prosecuted by Assistant United States Attorney Robert Hamilton.
Northern California Real Estate Investor Pleads Guilty to Bid Rigging at Public Foreclosure AuctionsRead the Press Release
A Northern California real estate investor pleaded guilty today for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
Kuo Hsuan “Chuck” Chang, of San Francisco, entered his guilty plea in U.S. District Court for the Northern District of California in San Francisco. Felony charges were filed against Chang on Oct. 9, 2013.
Chang is the 37th individual to plead guilty or agree to plead guilty as a result of the department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California.
According to court documents, Chang conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in San Francisco County, Calif. Chang was also charged with conspiring to use the mail to carry out schemes to fraudulently acquire title to selected properties sold at public auctions, to make and receive payoffs, and to divert co-conspirators’ money that would have otherwise gone to mortgage holders and others. Chang is charged with participating in these conspiracies beginning as early as October 2009 and continuing until about November 2010.
“The Antitrust Division will continue to vigorously prosecute anticompetitive schemes that compromise local markets and cause financial harm to consumers,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Collusion at foreclosure auctions harmed both lenders and distressed homeowners in an already struggling real estate market, and the conspirators must be held accountable.”
As described in the charging document, the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at San Francisco County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties, and, in some cases, the defaulting homeowner.
“We urge anyone with information regarding fraudulent anticompetitive practices at foreclosure auctions to contact the FBI or our partners at the Antitrust Division,” said FBI San Francisco Special Agent in Charge David J. Johnson. “The FBI will continue to work with our law enforcement partners and the community to root out and bring to justice those individuals who undermine the real estate market and victimize legitimate consumers.”
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for the Sherman Act charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victims if either amount is greater than $1 million. A count of conspiracy to commit mail fraud carries a maximum sentence of 30 years in prison and a $1 million fine.
The charges against Chang are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Alameda and Contra Costa counties, Calif. These investigations are being conducted by the Antitrust Division’s San Francisco Office and the FBI’s San Francisco Office. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco office at 415-436-6660, visit www.justice.gov/atr/contact/newcase.html or call the FBI tip line at 415-553-7400.
This case was brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants, including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
**The fraud charge(s) referenced in this press release were
subsequently dismissed on the government’s motion.**
Nine Members of Violent Outlaw Motorcycle Gang ArrestedRead the Press Release
Nine members of a violent, armed, outlaw motorcycle gang were indicted and arrested today, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan.
The nine individuals are members of the Phantom Outlaw Motorcycle Club, which is headquartered in northwest Detroit and has chapters throughout Michigan, Ohio, and Kentucky. According to court records, the club and its members are allegedly involved in a range of criminal activity including murder and attempted murder, robbery, narcotics trafficking, the possession and sale of stolen motor vehicles and motorcycles, and witness intimidation.
The indictment charged the following individuals:
• Antonio Johnson, 39, of Detroit, charged with conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering, use and carry of firearms during and in relation to a crime of violence, and felon in possession of firearms.
• Marvin Nicholson, 45, of Detroit, charged with conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering, use and carry of firearms during and in relation to a crime of violence, assault of federal officers, and felon in possession of firearms.
• Raynard Brown, 37, of Detroit, charged with conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering, and use and carry of firearms during and in relation to a crime of violence.
• Christopher Odum, 28, of Detroit, charged with conspiracy to commit murder in aid of racketeering.
• Roger Valdez, 28, of Pontiac, Mich., charged with conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering, and use and carry of firearms during and in relation to a crime of violence.
• Brian Sorrell, 27, of Detroit, charged with conspiracy to commit murder in aid of racketeering, assault with a dangerous weapon in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering, and use and carry of firearms during and in relation to a crime of violence.
• Brian Jackson, 46, of Detroit, charged with conspiracy to commit murder in aid of racketeering.
Two additional individuals, known at this time only by their club nicknames, have been charged with conspiracy to commit murder in aid of racketeering.
The details contained in the indictment are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The arrests were made as part of the Detroit One Initiative, a collaborative effort between law enforcement and the community to reduce homicide and other violent crime in Detroit, and through the lead efforts of the CVRP (Comprehensive Violence Reduction Partnership) Task Force, which consists of representatives of the Bureau of Alcohol, Tobacco, Firearms and Explosives; Detroit Police Department; Michigan State Police; Michigan Department of Corrections; and the FBI. By working collaboratively, local, state, and federal law enforcement is striving to maximize its ability to identify and arrest the persons and groups initiating the violence in Detroit. This indictment is a tangible and significant result of this joint effort.
The case is being prosecuted by the Criminal Division’s Organized Crime and Gang Section and the U.S. Attorney’s Office for the Eastern District of Michigan in Detroit.
New Haven Man Sentenced to More Than Four Years in Federal Prison for Illegal Gun PossessionRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that RUFUS SPEARMAN, 36, of New Haven, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 52 months of imprisonment, followed by three years of supervised release, for illegally possessing a firearm.
According to court documents and statements made in court, during a police pursuit on November 10, 2012, SPEARMAN discarded a loaded .50 caliber semi-automatic pistol underneath the front porch of a residence on Clover Place in New Haven. He was apprehended a short time later and the firearm was recovered. A search of SPEARMAN’s person revealed quantities of marijuana and methylone, also known as “bath salts.”
SPEARMAN’s criminal history includes state felony convictions for sale of hallucinogen/narcotics, possession of a controlled substance with intent to sell, arson and conspiracy to commit arson in the first degree.
SPEARMAN has been detained since his arrest on November 10, 2012. On July 11, 2013, he pleaded guilty to one count of possession of a firearm by a previously convicted felon.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven Police Department. The case was prosecuted by Assistant U.S. Attorney Anthony E. Kaplan.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Memphis Man Justin A. Jones Indicted for Filing False Irs FormsRead the Press Release
Memphis, TN – Justin A. Jones, 31, of Memphis, TN was indicted by a federal grand jury last week on charges that he created false Internal Revenue Service (IRS) documents for the purpose of causing the agency to place financial obligations on a third party, announced U.S. Attorney Edward L. Stanton III and Christopher A. Henry, Special Agent in Charge, IRS Nashville Field Office.
# # # #
According to facts revealed in the indictment, Jones corruptly endeavored to obstruct and impede the due administration of Internal Revenue laws by submitting to the Internal Revenue Service fictitious IRS Forms 1099-C (Cancellation of Debt) and 1099-OID (Original Issue Discount), each in the amount of $25,000, along with an IRS Form 1096 (Annual Summary and Transmittal), in order to cause the Internal Revenue Service to place financial obligations on J.W., a prosecutor assigned to prosecute Jones for criminal violations in Germantown, Tennessee, and the City of Germantown, when no relationship existed between Jones and J.W. or the City of Germantown that required the filing of the Form 1099-C or 1099-OID with the IRS. The IRS typically considers cancelled or forgiven debt to be taxable income to the debtor.
If convicted, Jones could receive up to three years in prison and a fine of up to $250,000. There is no parole in the federal system. This case was investigated by IRS Criminal Investigations, the Federal Bureau of Investigation, and the Germantown Police Department. Assistant U.S. Attorney Fred Godwin is representing the government.
The charges and allegations contained in the indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.
Manhattan U.S. Attorney Announces Guilty Plea Agreement with SAC Capital Management CompaniesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today an agreement (the “Agreement”) to resolve insider trading charges against four companies – S.A.C. CAPITAL ADVISORS, L.P. (“SAC Capital LP”), S.A.C. CAPITAL ADVISORS, LLC (“SAC Capital LLC”), CR INTRINSIC INVESTORS, LLC (“CR Intrinsic”), and SIGMA CAPITAL MANAGEMENT, LLC (“Sigma Capital”), collectively (the “SAC Companies”) – that are responsible for the management of a group of affiliated hedge funds, collectively (the “SAC Hedge Fund” or “SAC”).
Under the Agreement, which is subject to Court approval, the SAC Companies will plead guilty to each count in which they are charged of an indictment (the “Indictment”) unsealed in July of this year charging the SAC Companies with securities fraud and wire fraud in connection with a large-scale insider trading scheme. The Agreement imposes a $1.8 billion financial penalty on the SAC Companies – the largest insider trading penalty in history – split between a $900 million fine in the criminal case (the “Criminal Case”), and a $900 million forfeiture judgment in a civil money laundering and forfeiture action (the “Forfeiture Action”) filed by the Government simultaneously with the criminal charges. It also provides that the SAC Companies and their affiliates will no longer accept outside investor funds and will shut down operations as an investment adviser.
The Agreement between the Government and the SAC Companies to plead guilty to all of the charges in the Indictment in which they are charged and resolve the Forfeiture Action is subject to judicial review and approval. The Government submitted the Agreement this morning to U.S. District Judge Laura T. Swain, who is presiding over the Criminal Case, captioned United States v. S.A.C. Capital Advisors, L.P., et al., 13 Cr 541 (LTS), and U.S. District Judge Richard J. Sullivan, who is presiding over the Forfeiture Action, captioned United States v. S.A.C. Capital Advisors, L.P., et al., 13 Civ. 5182 (RJS). The Agreement has no force unless and until it is approved by the district judges.
Manhattan U.S. Attorney Preet Bharara said: “As I said four years ago, at the time of our first major insider trading arrests, greed sometimes is not good. And there are at least 75 convicted insider trading defendants who, today, would likely agree. But individual guilt is not the whole of our mission. Sometimes, blameworthy institutions need to be held accountable too. No institution should rest easy in the belief that it is too big to jail. That is a moral hazard that a just society can ill afford. Today, SAC Capital, one of the world’s largest and most powerful hedge funds, agreed to plead guilty, shut down its outside investment business, and pay the largest fine in history for insider trading offenses. That is the just and appropriate price for the pervasive and unprecedented institutional misconduct that occurred here.”
FBI Assistant Director-in-Charge George Venizelos said: “What SAC Capital’s plea demonstrates is that cheating and breaking the law were not only permitted but allowed to persist. The result is $1.8 billion in fines and forfeiture, the largest penalty in an insider trading case ever, and termination of their investment advisory business. The problem of insider trading is real. For companies that willfully turn a blind eye, be on notice: how your employees make money is just as important as how much they make. The FBI’s investigation into insider trading on Wall Street, on Main Street, in hedge funds, at expert networking firms, and anywhere else, continues.”
As alleged in the Indictment, from 1999 through at least 2010, numerous employees of the SAC Companies obtained and traded on material, non-public information that they were not permitted to have (“Inside Information”), or recommended trades based on such information to SAC Portfolio Managers (“SAC PMs”) or the SAC Owner. Specifically, the Indictment charges the SAC Companies with insider trading offenses committed by numerous employees, occurring over the span of more than a decade, and involving the securities of more than 20 publicly-traded companies across multiple sectors of the economy. As charged in the Indictment, the systematic insider trading engaged in by SAC PMs and Research Analysts was the predictable and foreseeable result of multiple institutional failures. The failures alleged included hiring practices heavily focused on recruiting employees with networks of public company insiders, the failure of SAC management to question employees about trades that appeared to be based on Inside Information, and ineffective compliance measures that failed to prevent or detect such trading, particularly prior to late 2009.
The Complaint in the Forfeiture Action alleges that the SAC Companies engaged in money laundering by commingling the illegal profits from insider trading with other assets, using the profits to promote additional insider trading, and transferring the profits with the assistance of financial institutions.
The Agreement announced today has two component parts: first, a plea agreement to resolve the Criminal Case, and second, a stipulation and proposed order to resolve the civil money laundering and forfeiture claims in the Forfeiture Action. Both documents have been submitted to the district judges for review. If approved, the Agreement would provide for the following:
- The SAC Companies will plead guilty to all counts of the Indictment in which they are charged, which include a securities fraud and wire fraud count for each of the SAC companies.
- The SAC Companies will pay a $1.8 billion financial penalty, consisting of a $900 million fine in the Criminal Case and a $900 million judgment in the Forfeiture Action. Because the SAC Companies have already agreed to pay $616 million to the U.S. Securities & Exchange Commission to resolve related civil insider trading charges, that amount will be credited against today’s penalty, and therefore, the additional payment required under this Agreement will be approximately $1.2 billion. The SAC Companies have further agreed that neither they nor any other person or entity paying any portion of the $1.8 billion financial penalty shall claim any tax deduction or credit for any money paid in resolving the Criminal Case and the Forfeiture Action.
- The SAC Companies will no longer accept third party investor funds and will terminate operations as an investment adviser.
- The SAC Companies will each be sentenced to five-year terms of probation – the maximum allowed by law – with a provision to end probation earlier if the SAC Companies cease operating entirely. The terms of probation will require, among other conditions, that the SAC Companies employ appropriate compliance measures to identify and prevent insider trading. Additionally, the insider trading compliance measures of the SAC Companies and any related entities trading securities will be reviewed by an independent compliance expert who will direct the SAC Companies to correct identified deficiencies.
The Agreement would resolve the criminal charges against the SAC Companies but does not provide any individual with immunity from prosecution. Under the terms of the Agreement, the Government is not prevented from charging any individual with insider trading offenses and seeking the maximum prison term authorized by law for such offenses.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Arlo Devlin-Brown, Antonia M. Apps and John T. Zach are in charge of the prosecution, and Assistant U.S. Attorneys Sharon Cohen Levin, Chief of the Asset Forfeiture Unit, Micah Smith and Christine Magdo are responsible for the forfeiture aspects of the case.
The Agreement relates only to the guilt of the SAC Companies and resolves pending charges against only the SAC Companies – it does not include any admissions pertaining to individual defendants. All criminal defendants are presumed innocent unless and until proven guilty.
U.S. v. SAC Capital Advisors LLP, et al. Cover Ltr, Plea Agt, and Stip
Man Sentenced to 70 Months in Prison for Possessing Child PornographyRead the Press Release
David K. Hechler, 28, of Chicago, Illinois, was sentenced Friday, November 1, 2013, in federal court to 70 months in prison for Possession of Child Pornography, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Following his prison sentence, Hechler will be on federal supervised release for 10 years and will also be required to register as a sex offender for the remainder of his life.
Court documents establish that in September 2007, during an undercover investigation conducted by the FBI Innocent Images Unit, agents identified a computer located in the Southern District of Illinois that had been used to attempt to purchase child pornography from the undercover internet website. Further investigation revealed that the computer and IP address used belonged to Hechler, who was a student at Greenville College at the time. During an interview with law enforcement, Hechler admitted to downloading and viewing image and video files containing child pornography on his computer. A forensic examination of Hechler’s computers revealed 262 image files and 3 video files containing child pornography.
This case is part of Project Safe Childhood, a nationwide initiative launched in 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.”
The investigation was conducted by the Federal Bureau of Investigation’s Metro East Cyber Crimes and Analysis Task Force. The case was prosecuted by Assistant United States Attorney Ali Summers.