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Tuesday 29 October 2013
Waterbury Man Who Lied to Federal Agents Conducting Tax Fraud Investigation Is SentencedRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that JOHN B. MAIA, 73, of Waterbury, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to three months of home confinement and one year of probation for lying to federal agents conducting a tax fraud investigation. MAIA was also ordered to perform 200 hours of community service and pay a $1,000 fine.
According to court documents and statements made in court, on April 14, 2010, MAIA, a retired Waterbury Police detective and inspector with the Waterbury State’s Attorney’s Office, submitted to a voluntary interview with special agents of the Internal Revenue Service – Criminal Investigation who were conducting an investigation into fraudulent conduct by Thomas Thorndike and the clients of Thorndike’s tax preparation business, Cornerstone Financial Services. MAIA was a Cornerstone Financial Services client. During the interview, agents asked MAIA if he had overstated deductions for charitable contributions and listed fictitious business expenses on his federal tax returns from 2005 through 2008. MAIA falsely stated that the charitable contributions and business expenses were legitimate and that he had provided supporting documentation for the contributions and expenses to his tax preparer.
On March 22, 2013, MAIA pleaded guilty to one count of making a false statement to federal law enforcement.
Thorndike pleaded guilty to tax offenses in October 2012 and, on March 12, 2013, was sentenced to 72 months of imprisonment.
This matter was investigated by the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorneys Christopher Mattei and Eric Glover.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Two Men Charged with Swindling Victims of Thousands of Dollars in Advance Fees While Failing to Modify Home LoansRead the Press Release
CHICAGO ― Two men who operated various businesses at multiple Chicago area locations since at least 2009 are facing federal fraud charges for allegedly charging thousands of dollars in advance fees, purportedly to help individuals modify their existing home mortgage loans, but then failing to provide the services they promised. The charges allege that the defendants defrauded a handful of known victims, but federal law enforcement officials believe there could be hundreds of potential victims and are appealing for information from anyone with knowledge of the alleged scheme.
The defendants, EVERETT POPE, also known as “Jonathan Pincuss,” 38, of Bolingbrook, and COLBI ANDRY, aka “Richard Lockwell” and “Rich Ingram,” 38, of Chicago, were each charged with wire fraud in a criminal complaint that was filed last week in U.S. District Court. Both men were released on $10,000 unsecured bonds and have a preliminary hearing set for Nov. 13 before U.S. Magistrate Judge Michael Mason in Federal Court.
The business entities that they allegedly used were: EAC Financial LLC; Emergency Debt Relief Center; Dimond Financial LLC; D Financial; The Andry Group, LLC; Family First Home Solutions LLC; The Law Group; Certified Forensic Loan Auditors, LLC; and Integrity Mortgage and Insurance Co., all of which were located, often at retail business sites, in Chicago or south suburban Monee or Matteson.
Anyone who suspects that he or she might be a victim and has not already received a victim survey from the U.S. Attorney's Office should submit their name and address to [email protected]. Persons without internet access may call a toll-free number ― (866) 364-2621 ― and leave a message with the spelling of their name and an address, and a form will be mailed to them.
According to the complaint, Pope and Andry frequently convinced customers who were not experiencing financial hardship that they were eligible for loan modifications. Then, they demanded up-front fees from victims, usually ranging between $2,000 and $3,000. For many of their victims, loan modifications were never completed or were completed with terms that were less favorable and without the customers’ agreement.
To perpetuate the alleged scheme, Pope and Andry have used aliases to conceal their true identities, and they have frequently changed business names to make it more difficult for dissatisfied customers to locate them. As part of the scheme, Pope and Andry falsely represented to victims that their loan modification would be overseen by an attorney, the charges allege. At times, Pope allegedly identified himself as “attorney Jonathan Pincuss.”
After the City of Chicago and the Illinois Attorney General’s Office filed separate civil lawsuits in 2010 and 2011, respectively, against Pope, Andry, and certain business entities that were known at that time, the complaint alleges that the defendants ceased operating under those business names and started up new business entities while continuing to defraud customers.
The charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Shields, Jr., Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The government is being represented by Assistant U.S. Attorney Sharon Fairley.
Wire fraud carries a maximum penalty of 20 years in prison and a $250,000 fine, or an alternative fine totaling twice the gross gain or twice the loss, whichever is greater, and restitution is mandatory. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
A complaint contains only charges and is not evidence of guilt. The defendants presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The investigation falls under the umbrella of the Financial Fraud Enforcement Task Force, which includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit: StopFraud.gov.
Complaint
Tax Return Preparer Pleads Guilty to Tax FraudRead the Press Release
ATLANTA - Amberula Levitt pleaded guilty today to two counts of filing false personal tax returns for the 2004 and 2005 tax years.
“Remarkably, this defendant was preparing tax returns for others while cheating on her own,” said United States Attorney Sally Quillian Yates. “She used her knowledge and expertise of the tax system to try and defraud it.”
“Individuals who evade their tax obligations cheat their country and their fellow citizens,” said Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division. “The Justice Department will investigate and prosecute tax professionals who use their skills to defraud the Internal Revenue Service.”
"Each of us is responsible for filing correct and accurate tax returns, “stated IRS CI Special Agent in Charge, Veronica F. Hyman-Pillot. "IRS CI will continue to investigate those individuals who intentionally evade their tax obligations."
According to United States Attorney Yates, the charges and other information presented in court: From 2004 through 2010, Levitt owned and operated Tax Time Tax Service (“Tax Time”), a tax preparation business with multiple locations throughout metro Atlanta. Levitt fraudulently under-reported the earnings from Tax Time on her personal tax returns. For the years 2004 through 2009, Levitt owes approximately $620,000 in back taxes to the IRS.
The charges for filing a false tax return in this case carry a maximum sentence of three years in prison and a fine of up to $250,000 on each count. In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
Sentencing for Levitt, 44, of East Point, Ga., is scheduled for January 23, 2014, at 10:30 am before United States District Judge Amy Totenberg.
This case is being investigated by the Internal Revenue Service Criminal Investigation.
Trial Attorney Christopher J. Maietta of the Justice Department’s Tax Division and Assistant United States Attorney Steven D. Grimberg are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the home page for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.
Springfield Man Pleads Guilty to Scheme to Sell Thousands of Counterfeit DVDsRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Springfield, Mo., man has pleaded guilty in federal court to charges related to a scheme to sell thousands of counterfeit DVDs over the Internet.
Matthew Cerullo, 42, of Springfield, waived his right to a grand jury and pleaded guilty before U.S. Magistrate Judge David P. Rush on Monday, Oct. 28, 2013, to a four-count information that charges him with mail fraud, trafficking in counterfeit labels, trafficking in counterfeit goods and making false statements to federal agents.
Based on records obtained from the U.S. Postal Service, the United Parcel Service (UPS), DHL, EBay and Amazon.com, federal agents determined that Cerullo purchased and received more than 22,000 counterfeit DVDs from a distributor in Hong Kong, China between Feb. 13, 2013 and Sept. 10, 2013.
According to court documents, the federal investigation began when a shipment of counterfeit DVDs from Hong Kong was seized by Customs and Border Protection agents at JFK Airport. The counterfeit DVDs were being shipped to a UPS store located in Springfield under the name of a business owned by Cerullo.
Homeland Security Investigations (HSI) agents interviewed Cerullo at his residence on May 2, 2013. Cerullo told agents that he had not receive a seizure notice from Customs and Border Protection. Cerullo also told agents that he orders toys and jewelry from China to resell on EBay or to local venders, but does not buy DVDs. Cerullo claimed that he owns only one business, C3 Wholesale, LLC.
During the course of the investigation, however, agents learned that Cerullo’s statement contained false and fraudulent information that was designed to mislead them and their investigation. Agents determined that Cerullo had in fact received four prior seizure notices from Customers and Border Protection; these notices were discovered in his desk during the execution of a search warrant at his residence. Agents also learned that Cerullo owned, operated and sold counterfeit DVDs through four different businesses: C3 Wholesale, LLC; EJC Supply, LLC; Midwest Wholesale and Capital Sierra, LLC; and EJC Supply Company.
On Sept. 3, 2013, agents observed Cerullo mail a large quantity of packages at a local post office. Postal Inspectors inspected the contents of these packages and discovered that Cerullo had mailed 165 packages of counterfeit DVDs to various individuals around the country. Inspectors also noted that the return address on each package was fictitious.
The next day, federal agents executed a search warrant on Cerullo’s residence and a storage locker that Cerullo rented. Agents discovered more than 22,000 counterfeit DVDs between those locations.
Under federal statutes, Cerullo is subject to a sentence of up to 40 years in federal prison without parole, plus a fine up to $1 million and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Patrick Carney. It was investigated by the Department of Homeland Security.Sex Trafficker Terrence “T-Rex” Yarbrough Sentenced to Serve536 Months in PrisonRead the Press Release
U.S. District Court Judge S. Thomas Anderson sentenced Terrence Yarbrough, aka “T-Rex,” 38, of Memphis, Tenn., to serve 536 months in prison, the Justice Department announced today. A jury convicted Yarbrough on Dec. 5, 2012 of 10 counts of sex trafficking and one count of conspiracy to commit food stamp fraud.
“The Civil Rights Division is committed to pursuing justice on behalf of vulnerable members of our society,” said Acting Assistant Attorney General Jocelyn Samuels. “Today’s sentence sends a clear message that the United States will not tolerate modern-day slavery and will work tirelessly to restore the rights and dignity of its victims.”
“Today’s sentence of 536 months in prison ensures Terrence Yarbrough, a ruthless predator who inflicted unspeakable physical and emotional harm upon vulnerable young women, will be held accountable for his depraved acts,” said Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee. “We will continue to prosecute those who engage in such reprehensible conduct of coercion and exploitation.”
During the trial, victims recounted a series of violent acts perpetrated by Yarbrough to coerce them into prostituting for him, including being beat with belts, wooden coat hangers, crowbars, padlocks and dog chains; being thrown down stairs; having their heads smashed in car doors; having their legs burned with irons; and being scalded with boiling water.
“The horrific physical violence, sexual abuse, and emotional torment suffered by the victims in this case cannot be undone, but this sentence ensures that their violent and evil predator will face the consequences of his actions,” said A. Todd McCall, Special Agent in Charge of the Memphis Division of the Federal Bureau of Investigation. “The efforts of the FBI and our law enforcement partners have removed a human trafficker from our streets. We will continue to work together to aggressively pursue and bring to justice those who cruelly exploit others for profit, and to restore the rights and dignity of human trafficking victims.”
“ The USDA-Office of Inspector General is committed to the investigation and prosecution of those individuals who fraudulently obtain food stamp benefits,” said Karen Citizen-Wilcox, Special Agent in Charge of the Southeast Region for the U.S. Department of Agriculture’s Office of the Inspector General. “We are very pleased we were able to work with the U.S. Attorney's Office and other law enforcement agencies in this case .”
Evidence presented at trial included the testimony of 10 victims identified in the indictment as well as several eyewitnesses. Numerous witnesses testified that Yarbrough repeatedly lured vulnerable victims, some as young as 15 years old, into prostitution with false promises of love, family and prosperity. The evidence showed that any time a victim refused to engage in prostitution, Yarbrough resorted to threats, intimidation and violence. The jury heard testimony that Yarbrough’s pattern of recruitment, exploitation, and violent coercion continued for years before his 2009 arrest in St. Louis.
One victim testified that Yarbrough forced her to engage in prostitution the entire time she was pregnant with his child and that he frequently beat her on the stomach when she did not want to comply with his demands. He induced labor through a severe beating in her eighth month of pregnancy, during which time he also had her working as a prostitute in Tunica, Miss. Yarbrough drove her back to Memphis, dropped her off at a hospital, and forced her to resume prostituting the day after her release. At a later date, Yarbrough smashed her on the head with a lamp and kicked out her front teeth when she tried to stop prostituting for him.
Another victim testified that Yarbrough lured her into prostitution by promising to reunite her with their children, then beat her severely when she insisted on seeing them and refused to continue working, punching her in the face so hard that he broke three of her teeth. On another occasion, he beat her knees with a metal pipe, causing injuries that continue to affect her. She also testified that Yarbrough threatened to prostitute their nine-year-old daughter.
Further testimony showed that a victim slept through a phone call from a client after prostituting for days on end with almost no sleep, and that when Yarbrough found out that she had missed the call, he smashed her head into a car door, dragged her by the hair to his hotel room and beat her with his belt. Jurors also saw a letter addressed to the same victim and signed by Yarbrough stating that he was proud she did not scream during the aforementioned beating.
Witnesses testified that as a warning, Yarbrough bragged about his beatings of some victims to other victims. Jurors also saw the “T-Rex” logos Yarbrough tattooed on four separate victims, and heard that he claimed that they had been “branded” as his property. Testimony and jail recordings showed that Yarbrough confiscated his victims’ identification documents and money to make it difficult for them to escape.
Jurors also heard testimony that Yarbrough conspired with his mother, Norma Yarbrough Webb, 66, and Michelle Johnson, 41, to fraudulently obtain food stamp benefits while Yarbrough was incarcerated. Johnson and Webb previously pled guilty to related charges.
The case was investigated by the FBI and the U.S. Department of Agriculture Office of the Inspector General, with assistance from the St. Louis Police Department. Assistant U.S. Attorney Jonathan Skrmetti and Trial Attorney Benjamin J. Hawk of the United States Department of Justice Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted the case.
Seventh Correctional Officer Pleads Guilty to A Racketeering ConspiracyRead the Press Release
Smuggled Drugs and Other Contraband for BGF Gang Members in Baltimore Correctional Facilities
Baltimore, Maryland – Kimberly Dennis, age 26, of Baltimore, Maryland pleaded guilty today to a racketeering conspiracy for smuggling drugs and other contraband for members of the Black Guerilla Family (BGF) gang inside several correctional facilities.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Secretary Gary D. Maynard of the Maryland Department of Public Safety and Correctional Services; Baltimore Police Commissioner Anthony W. Batts; and Baltimore City State’s Attorney Gregg L. Bernstein.According to court documents, BGF has been the dominant gang at the Baltimore City Detention Center (BCDC), and in several connected facilities, including the Baltimore Central Booking Intake Center, the Women’s Detention Center, which houses many men, and in the Jail Industries Building.
According to her plea, Kimberly Dennis worked as a Correctional Officer (CO) at Baltimore City Detention Center (BCDC) from 2006 to 2013. She entered into personal and sexual relationships with two inmates who were members of the Black Guerilla Family (“BGF). Dennis smuggled contraband, including marijuana, tobacco and prescription pills, into BCDC on behalf of BGF inmates, who would then sell that contraband to other BCDC inmates who were members of BGF. Dennis was aware that of the inmates’ BGF affiliation and assisted in furthering the racketeering enterprise. Dennis worked with other CO’s to assist in the smuggling. Dennis obtained contraband from others, including co-defendants. Dennis was aware that other co-defendants and correctional officers also smuggled contraband.
Dennis faces a maximum sentence of 20 years in prison for the racketeering conspiracy. U.S. District Judge Ellen L. Hollander scheduled sentencing for January 24, 2014.
In addition to Dennis, six other CO’s have pleaded guilty to the racketeering enterprise:
Jasmin Jones, a/k/a/ J.J., age 24, of Baltimore;
Taryn Kirkland, age 23, of Baltimore;
Jennifer Owens, a/k/a/ O and J.O., age 31, of Randallstown;
Adrena Rice, age 25, of Baltimore;
Katera Stevenson, a/k/a KK, age 24, of Baltimore; and
Jasmine Thornton, a/k/a J.T., age 26, of Glen Burnie.Three other co-defendants, inmates Tavon White, age 36, and Steven Loney, age 24, both of Baltimore, and Tyesha Mayo, age 29, of Baltimore, have also pleaded guilty.
The case arose from the efforts of the Maryland Prison Task Force, a group of local, state and federal law enforcement agencies and prosecutors that met regularly for more than two years and generated recommendations to reform prison procedures. The investigation is continuing.U.S. Attorney Rosenstein recognized the efforts of the other members of the Maryland Prison Task Force, including: Colonel Marcus L. Brown, Superintendent of the Maryland State Police; Chief Mark A. Magaw of the Prince George’s County Police Department; United States Marshal Johnny Hughes; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Tom Carr, Director of the Washington-Baltimore High Intensity Drug Trafficking Area; and Dave Engel, Executive Director of the Maryland Coordination and Analysis Center.
United States Attorney Rod J. Rosenstein praised the FBI, Maryland Department of Public Safety and Correctional Services, Baltimore Police Department, and Maryland Prison Task Force, for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Robert R. Harding and Ayn B. Ducao, who are prosecuting this Organized Crime Drug Enforcement Task Force case.Rabobank Admits Wrongdoing in Libor Investigation, Agrees to Pay $325 Million Criminal PenaltyRead the Press Release
Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank) has entered into an agreement with the Department of Justice to pay a $325 million penalty to resolve violations arising from Rabobank’s submissions for the London InterBank Offered Rate (LIBOR) and the Euro Interbank Offered Rate (Euribor), which are leading benchmark interest rates around the world, the Justice Department announced today.
A criminal information will be filed today in U.S. District Court for the District of Connecticut that charges Rabobank as part of a deferred prosecution agreement (DPA). The information charges Rabobank with wire fraud for its role in manipulating the benchmark interest rates LIBOR and Euribor. In addition to the $325 million penalty, the DPA requires the bank to admit and accept responsibility for its misconduct as described in an extensive statement of facts. Rabobank has agreed to continue cooperating with the Justice Department in its ongoing investigation of the manipulation of benchmark interest rates by other financial institutions and individuals.
“For years, employees at Rabobank, often working with traders at other banks around the globe, illegally manipulated four different interest rates – Euribor and LIBOR for the U.S. dollar, the yen, and the pound sterling – in the hopes of fraudulently moving the market to generate profits for their traders at the expense of the bank’s counterparties,” said Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division. “Today’s criminal resolution – which represents the second-largest penalty in the Criminal Division’s active, ongoing investigation of the manipulation of global benchmark interest rates by some of the largest banks in the world – comes fast on the heels of charges brought against three former ICAP brokers just last month. Rabobank is the fourth major financial institution that has admitted its misconduct in this wide-ranging criminal investigation, and other banks should pay attention: our investigation is far from over.”
“Rabobank rigged multiple benchmark rates, allowing its traders to reap higher profits at the expense of their unsuspecting counterparties,” said Deputy Assistant Attorney General Leslie C. Overton of the Justice Department’s Antitrust Division. “Not only was this conduct fraudulent, it compromised the integrity of globally-used interest rate benchmarks – undermining financial markets worldwide.”
“Rabobank admitted to manipulating LIBOR and Euribor submissions which directly affected the rates referenced by financial products held by and on behalf of companies and investors around the world,” said Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office. “Rabobank’s actions resulted in the deliberate harm to counterparties holding products referencing the manipulated rates. Today’s announcement is yet another example of the tireless efforts of the FBI special agents and forensic accountants who are dedicated to investigating complex fraud schemes and, together with prosecutors, bringing to justice those who participate in such schemes.”
Together with approximately $740 million in criminal and regulatory penalties imposed by other agencies in actions arising out of the same conduct – $475 million by the Commodity Futures Trading Commission (CFTC) action, $170 million by the U.K. Financial Conduct Authority (FCA) action and approximately $96 million by the Openbaar Ministerie (the Dutch Public Prosecution Service) – the Justice Department’s $325 million criminal penalty brings the total amount to be paid by Rabobank to more than $1 billion.
According to signed documents, LIBOR is an average interest rate, calculated based upon submissions from leading banks around the world and reflecting the rates those banks believe they would be charged if borrowing from other banks. LIBOR serves as the primary benchmark for short-term interest rates globally and is used as a reference rate for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products. The Bank of International Settlements estimated that as of the second half of 2009, outstanding interest rate contracts were valued at approximately $450 trillion.
LIBOR is published by the British Bankers’ Association (BBA), a trade association based in London. At the time relevant to the conduct in the criminal information, LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities, ranging from overnight to one year. The LIBOR for a given currency at a specific maturity is the result of a calculation based upon submissions from a panel of banks for that currency (the Contributor Panel) selected by the BBA. From at least 2005 through 2011, Rabobank was a member of the Contributor Panel for a number of currencies, including United States dollar (dollar) LIBOR, pound sterling LIBOR, and yen LIBOR.
The Euro Interbank Offered Rate (Euribor) is published by the European Banking Federation (EBF), which is based in Brussels, Belgium, and is calculated at 15 maturities, ranging from overnight to one year. Euribor is the rate at which Euro interbank term deposits within the Euro zone are expected to be offered by one prime bank to another at 11:00 a.m. Brussels time. The Euribor at a given maturity is the result of a calculation based upon submissions from Euribor Contributor Panel banks. From at least 2005 through 2011, Rabobank was also a member of the Contributor Panel for Euribor.
According to the statement of facts accompanying the agreement, from as early as 2005 through at least November 2010, certain Rabobank derivatives traders requested that certain Rabobank dollar LIBOR, yen LIBOR, pound sterling LIBOR, and Euribor submitters submit LIBOR and Euribor contributions that would benefit the traders’ trading positions, rather than rates that complied with the definitions of LIBOR and Euribor.
In addition, according to the statement of facts accompanying the agreement, from as early as January 2006 through October 2008, a Rabobank yen LIBOR submitter and a Rabobank Euribor submitter had two separate agreements with traders at other banks to make yen LIBOR and Euribor submissions that benefitted trading positions, rather than submissions that complied with the definitions of LIBOR and Euribor.
The Rabobank LIBOR and Euribor submitters accommodated traders’ requests on numerous occasions, and on various occasions, Rabobank’s submissions affected the fixed rates.
According to the statement of facts, Rabobank employees engaged in this conduct through electronic communications, which included both emails and electronic chats. For example, on Sept. 21, 2007, a Rabobank Yen derivatives trader emailed the Rabobank Yen LIBOR submitter at the time with the subject line “libors,” writing: “Wehre do you think today’s libors are? If you can, I would like 1mth libors higher today.” The submitter replied: “Bookies reckon 1m sets at .85.” The trader wrote back: “I have some fixings in 1 mth so would appreciate if you can put it higher mate.” The submitter replied: “No prob mate let me know your level.” The trader responded: “Wud be nice if you could put 0.90% for 1mth cheers.” The submitter wrote back: “Sure no prob. I’ll probably get a few phone calls but no worries mate!” The trader replied: “If you may get a few phone calls then put 0.88% then.” The submitter responded: “Don’t worry mate – there’s bigger crooks in the market than us guys!” That day, as requested, Rabobank’s 1-month Yen LIBOR submission was 0.90, an increase of seven basis points from its previous submission, whereas the other panel banks’ submissions decreased by approximately a half of a basis point on average. Rabobank’s submission went from being tied as the tenth highest submission on the Contributor Panel on the previous day to being the highest submission on the Contributor Panel.
On Nov. 29, 2006, a Rabobank dollar derivatives trader wrote to Rabobank’s Global Head of Liquidity and Finance and the head of Rabobank’s money markets desk in London, who supervised rate submitters: “Hi mate, low 1s high 3s LIBOR pls !!! Don't tell [another Rabobank U.S. Dollar derivatives trader] haa haaaaaaa. Sold the market today doooooohhhh!” The money markets desk head replied: “ok mate , will do my best …speak later.” After the LIBOR submissions that day, Rabobank’s ranking compared to other panel banks dropped as to 1-month dollar LIBOR and rose as to 3-month dollar LIBOR. Two days later, on Dec. 1, 2006, the trader again wrote to the money markets desk head: “Appreciate 3s go down, but a high 3s today would be nice… cheers chief.” The money markets desk head wrote back: “I am fast turning into your LIBOR bitch!!!!” The trader replied: “Just friendly encouragement that’s all , appreciate the help.” The money markets desk head wrote back: “No worries mate , glad to help ….We just stuffed ourselves with good ol pie , mash n licker !!”
In an example of an agreement with traders at other banks, on July 28, 2006, a Rabobank rate submitter and Rabobank trader discussed their mutual desires for a high fixing. The submitter stated to the trader: “setting a high 1m again today - I need it!” to which the trader responded: “yes pls mate…I need a higher 1m libor too.” Within approximately 20 minutes, the submitter contacted a trader at another Contributor Panel bank and wrote: “morning skipper.....will be setting an obscenely high 1m again today...poss 38 just fyi.” The other bank’s trader responded, “(K)...oh dear..my poor customers....hehehe!! manual input libors again today then!!!!” Both banks’ submissions on July 28 moved up one basis point, from 0.37 to 0.38, a move which placed their submissions as the second highest submissions on the Contributor Panel that day.
As another example, on July 7, 2009, a Rabobank trader wrote to a former Rabobank yen LIBOR submitter: “looks like some ppl are talking with each other when they put libors down. . . quite surprised that 3m libors came down a lot.” The former submitter replied: “yes deffinite manipulation – always is tho to be honest mate. . . i always used to ask if anyone needed a favour and vise versa. . . . a little unethical but always helps to have friends in mrkt.”
By entering into a DPA with Rabobank, the Justice Department took several factors into consideration, including that Rabobank has no history of similar misconduct and has not been the subject of any criminal enforcement actions or any significant regulatory enforcement actions by any authority in the United States, the Netherlands, or elsewhere. In addition, Rabobank has significantly expanded and enhanced its legal and regulatory compliance program and has taken extensive steps to remediate the misconduct. Significant remedies and sanctions are also being imposed on Rabobank by several regulators and an additional criminal law enforcement agency (the Dutch Public Prosecution Service).
This ongoing investigation is being conducted by special agents, forensic accountants, and intelligence analysts of the FBI’s Washington Field Office. The prosecution of Rabobank is being handled by Assistant Chief Glenn S. Leon and Trial Attorney Alexander H. Berlin of the Criminal Division’s Fraud Section and Trial Attorneys Ludovic C. Ghesquiere, Michael T. Koenig and Eric L. Schleef of the Antitrust Division. Deputy Chiefs Daniel Braun and William Stellmach of the Criminal Division’s Fraud Section, Criminal Division Senior Counsel Rebecca Rohr, Assistant Chief Elizabeth B. Prewitt and Trial Attorney Richard A. Powers of the Antitrust Division’s New York Office, and Assistant U.S. Attorneys Eric Glover and Liam Brennan of the U.S. Attorney’s Office for the District of Connecticut, along with Criminal Division’s Office of International Affairs, have provided valuable assistance in this matter.
The investigation leading to these cases has required, and has greatly benefited from, a diligent and wide-ranging cooperative effort among various enforcement agencies both in the United States and abroad. The Justice Department acknowledges and expresses its deep appreciation for this assistance. In particular, the CFTC’s Division of Enforcement referred this matter to the department and, along with the FCA, has played a major role in the investigation. The department has also worked closely with the Dutch Public Prosecution Service and De Nederlandsche Bank (the Dutch Central Bank) in the investigation of Rabobank. Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation relating to LIBOR and other benchmark rates, and the department is grateful for their cooperation and assistance. In particular, the Securities and Exchange Commission has played a significant role in the LIBOR investigation, and the department expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov.Related Materials:
Deferred Prosecution Agreement
Statement of Facts-->Deferred Prosecution Agreement
Statement of FactPhoenix Man Sentenced to Prison for Commercial Loan FraudRead the Press Release
PHOENIX - On Oct. 28, 2013, Joseph N. Gagliano, 45, of Phoenix, was sentenced to 30 months in prison and ordered to pay $2,903,010.26 in restitution by U.S. District Court Judge G. Murray Snow.
First Assistant U.S. Attorney Elizabeth A. Strange highlighted the significance of this sentence: “These loans should have gone to qualified small business owners in need of financial support. The defendant’s fraudulent conduct denied small business owners the opportunity to obtain access to capital in a difficult economy, and the United States Attorney’s Office will continue to investigate and prosecute such borrowers who obtain SBA loans through fraud.”
“Corrupt borrowers who attempt to defraud SBA=s loan programs will be aggressively pursued by our office,” said SBA Inspector General Peggy E. Gustafson. “This successful investigation and prison sentence demonstrates our commitment to insure that SBA loans are only disbursed to deserving small businesses helping to grow our economy. We appreciate the leadership of the U.S. Attorney=s Office and the support of the FBI to bring this indictment forward.”
The case against Gagliano was based on an investigation by the SBA-OIG and FBI. Between June 2006 and July 2010, Gagliano sought a SBA loan for a car wash located in Chandler and mortgage loans for residential real estate located in Scottsdale and Phoenix. He submitted loan applications that falsely misrepresented that his father, who has the same name, was the actual borrower, and also made misrepresentations concerning his income, assets, liabilities and intent to occupy the residential properties as a primary residence. Gagliano also forged signatures, altered bank statements and submitted bogus lease agreements. The scheme to defraud resulted in nearly $3 million in losses to the Small Business Administration, Wells Fargo Bank, and JP Morgan Chase.
The investigation in this case was conducted by the Small Business Administration-Office of Inspector General and the Federal Bureau of Investigation. The prosecution was handled by Kevin M. Rapp Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-12-00364-PHX-GMS
RELEASE NUMBER: 2013-081_Gagliano# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/Parkville Man Indicted for Sex TraffickingRead the Press Release
Baltimore, Maryland – A federal grand jury returned an indictment today charging Rodney Hubert, a/k/a “Noah,” age 38, of Parkville, Maryland, with sex trafficking of a minor.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Chief James W. Johnson of the Baltimore County Police Department; and Baltimore County State’s Attorney Scott Shellenberger.
According to the one count indictment, Hubert paid a 19 year old associate who worked for him as a prostitute a commission for recruiting a 16 year old girl to perform prostitution for him. Hubert allegedly offered to pay the 16 year old girl $400 to take photos of her wearing lingerie in a provocative manner. The girl posed for the pictures but never received the promised payment. Hubert offered to pay an additional $1,000 to make a pornographic film. The girl told Hubert that she was only 16 years old.
According to the allegations in the indictment, from February 1 to 22, 2013, Hubert uploaded these photos onto an internet website and advertised the girl as a prostitute. He paid a driver and a security guard to travel with the girl to “outcalls,” using money she earned as a prostitute. Hubert kept a large percentage of the girl’s earnings.
Hubert faces a minimum mandatory sentence of 10 years in prison and a maximum of life in prison followed by up to lifetime of supervised release. An initial appearance has not yet been scheduled.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
The case was investigated by the FBI-led Maryland Child Exploitation Task Force (MCETF), created in 2010 to combat child prostitution, with members from10 state and federal law enforcement agencies. The Task Force coordinates with the National Center for Missing and Exploited Children and the Maryland State Police Child Recovery Unit to identify missing children being advertised online for prostitution.
MCETF partners with the Maryland Human Trafficking Task Force, formed in 2007 to discover and rescue victims of human trafficking while identifying and prosecuting offenders. Members include federal, state and local law enforcement, as well as victim service providers and local community members. For more information about the Maryland Human Trafficking Task Force, please visit http://www.justice.gov/usao/md/priorities_human.html.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore County Police Department and Baltimore County State's Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Mark W. Crooks, who prosecuted the case.
Owners and Supervisor of Ambulance Transportation Company Plead Guilty in Los Angeles for Role in Ambulance Fraud SchemeRead the Press Release
The owners and supervisor of Alpha Ambulance Inc. (Alpha), a now-defunct Los Angeles-area ambulance transportation company, have pleaded guilty in connection with an ambulance fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Special Agent in Charge Glenn R. Ferry of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office made the announcement.
Alex Kapri, aka Alex Kapriyelov or Alexander Kapriyelov, 56; Aleksey Muratov, aka Russ Muratov, 32; and Danielle Hartsell Medina, 36, pleaded guilty on Oct. 28, 2013, before U.S. District Court Judge Audrey B. Collins in the Central District of California to conspiracy to commit health care fraud. They face a maximum penalty of 10 years in prison when they are sentenced on Feb. 24, 2014.
Kapri and Muratov were owners and operators of Alpha, an ambulance transportation company that operated in the greater Los Angeles area and that specialized in the provision of non-emergency ambulance transportation services to Medicare-eligible beneficiaries, primarily dialysis patients. Medina was employed by Alpha and ultimately supervised the training and education of its employees.
According to court documents, Kapri, Muratov and Medina knowingly provided non-emergency ambulance transportation services to Medicare beneficiaries whose medical condition at that time did not require those services. With Kapri’s knowledge, Muratov and Medina instructed certain Alpha employees to conceal the Medicare beneficiaries’ medical conditions by altering requisite paperwork and creating fraudulent reasons that justified, on paper, the transportation services. Based on these medically unnecessary transportation services, the defendants caused Alpha to submit false and fraudulent claims to Medicare.
Additionally, as the defendants were submitting false and fraudulent claims to Medicare, Medicare notified Alpha the company would be subject to a Medicare audit. In response to this notice, Muratov and Medina instructed Alpha employees – with Kapri’s knowledge – to alter requisite paperwork and create fraudulent reasons that justified, on paper, transportation services for the beneficiaries identified as the subject of Medicare’s audit.
From at least June 2008 through at least July 2012, Alpha submitted more than $49 million in claims for ambulance transportation services. As a result, Medicare paid Alpha more than $13 million for these claims, many of which were false and fraudulent.
The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. This case was prosecuted by Trial Attorneys Blanca Quintero and Alexander F. Porter and Assistant Chief O. Benton Curtis III.
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 Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Orlando Man Sentenced to 8 Years for Distributing Child PornographyRead the Press Release
Orlando, Florida – Chief U.S. District Judge Anne C. Conway sentenced David Lahn (60, Orlando) yesterday to 8 years in federal prison for distributing and attempting to distribute child pornography. Lahn is also required to register as a sex offender and to serve a 20-year term of supervision, following his release from prison. The court also ordered Lahn to forfeit his computer equipment. Lahn pleaded guilty on June 26, 2013.
According to court documents, on September 6, 2011, Lahn emailed images of child pornography to an individual in Australia. Later in 2011, the Queensland Police Service in Australia arrested the recipient of Lahn’s child pornography and informed the Federal Bureau of Investigation of Lahn’s email. Lahn later admitted to special agents that he sent the September 6, 2011 email and the attached images of child pornography. Law enforcement officers conducted a forensic examination of Lahn’s computers and found that he possessed more than 1,000 images and at least five videos depicting children and infants being sexually abused and exploited.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Andrew C. Searle.
This is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
Operators and Employee of Schaumburg Home Visiting Physician Group Among Three Indicted in $12 Million Medicare Fraud SchemeRead the Press Release
CHICAGO ― The administrator, medical director, and an employee of a Schaumburgbased in-home visiting physician group were indicted on federal charges for their alleged roles in a $12 million health care fraud scheme, federal law enforcement officials announced today. The defendants operated or were employed by a home visiting physician practice, Medicall Physicians Group, Ltd., that allegedly billed Medicare for patient services that were never provided. The defendants allegedly fraudulently obtained approximately $4.7 million in Medicare payments from January 2007 to December 2011.
A 10-count indictment that was returned by a federal grand jury last Wednesday was unsealed today following the arrest of RICK E. BROWN, 56, of Rockford, the president of Home Care America, Inc., which controlled the daily operations of Medicall. Brown pleaded not guilty and was released on a $10,000 unsecured bond at his arraignment today before U.S. Magistrate Judge Mary Rowland in Federal Court in Chicago.
Also indicted were Dr. ROGER A. LUCERO, 62, of Elmhurst, a physician and the medical director of Medicall, and MARY C. TALAGA, 53, of Elmwood Park, a Medicall and Home Care America employee who submitted claims to Medicare on behalf of Medicall and the medical professionals who were employed by Medicall. Lucero and Talaga were not arrested and will be arraigned on dates yet to be determined.
Brown and Lucero were each charged with one count of conspiracy to commit health care fraud and multiple counts of health care fraud. All three defendants were charged with three counts each of making false statements relating to health care matters. The indictment also seeks forfeiture of more than $4.49 million from Brown and Lucero.
According to the indictment, Brown and Lucero operated Medicall, and Talaga submitted the company’s bills to Medicare, totaling more than $12 million. Brown instructed employees to bill Medicare for patient oversight and other services that were never provided, and Lucero created backdated records in an effort to conceal the fraudulent billings, the indictment alleges. Talaga allegedly billed Medicare for these services, even though she knew they were not documented, a practice that required her to fabricate the information submitted to Medicare.
The arrest and charges were announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; Robert J. Shields Jr., Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation; and Lamont Pugh III, Special Agent-in- Charge of the Chicago Regional Office of the U.S. Department of Health and Human Services Office of Inspector General.
Health care fraud conspiracy and each count of health care fraud each carry a maximum penalty of 10 years in prison and a $250,000 fine, while each count of making false statements relating to health care matters carries a maximum penalty of five years in prison and a $250,000 fine. If convicted, restitution is mandatory and the court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
An indictment contains merely charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The investigation was conducted jointly by the FBI and HHS-OIG and brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office. The case is being prosecuted by Trial Attorney Brooke Harper of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in Chicago and eight other 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 Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: stopmedicarefraud.gov.
Indictment
Oakland Man Sentenced to More Than Five Years in Prison for Trafficking MethamphetamineRead the Press Release
OAKLAND – John Alan Hunt was sentenced yesterday to five and a half years in prison for trafficking methamphetamine, United States Attorney Melinda Haag announced.
Hunt, 52, of Oakland, Calif., was indicted by a federal grand jury on April 23, 2013. The three-count Indictment charged Hunt and co-defendants Daniel Artinger, and Nile Glenn with Conspiracy to Distribute and Possess with the Intent to Distribute Methamphetamine, in violation of 21 U.S.C. § 846, and Distribution and Possession with the Intent to Distribute Methamphetamine, in violation of 21 U.S.C. § 841(a)(1).
Hunt pleaded guilty on July 29, 2013, to Distribution and Possession with the Intent to Distribute Methamphetamine. According to the plea agreement, Hunt admitted that on August 2, 2012, and again on August 30, 2012, he knowingly and intentionally sold a total of approximately 48.4 grams of actual methamphetamine to an undercover officer in the in the vicinity of High Street in Oakland.
“One of ATF’s top priorities is to rid our neighborhoods of dangerous criminals who plague our community by selling drugs,” said Bureau of Alcohol, Tobacco, Firearms and Explosives, Special Agent in Charge Joseph M. Riehl. “The success of this investigation is attributed to the excellent undercover work that was conducted and the solid partnership between ATF, Oakland Police Department, and the United States Attorney’s Office.”
Artinger pleaded guilty on October 21, 2013, and is scheduled to be sentenced on January 6, 2014. Glenn pleaded guilty in the District of Oregon on October 24, 2013, and is scheduled to be sentenced there on February 5, 2014.
The sentence was handed down by The Honorable Claudia Wilken, U.S. District Court Chief Judge, Judge Wilken also sentenced the defendant to a 4 year period of supervised release.
Hunt has been in federal custody since his initial appearance on May 6, 2013.
Chinhayi Cadet is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Elizabeth Garcia. The prosecution is the result of a 10 month investigation by the ATF and the Oakland Police Department.
(Hunt indictment )
Notorious Sex Trafficker Terrence “T-Rex” Yarbrough Sentenced to 536 Months in PrisonRead the Press Release
Memphis, TN – Terrence Yarbrough, a/k/a, “T-Rex,” 38, of Memphis, Tenn., was sentenced to 536 months in federal prison today by United States District Judge S. Thomas Anderson. There is no parole in the federal system. The sentencing follows Yarbrough’s December 2012 conviction by a federal jury on 10 counts of sex trafficking and one count of conspiracy to commit food stamp fraud.
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“Today’s sentence of 536 months in prison ensures Terrence Yarbrough, a ruthless predator who inflicted unspeakable physical and emotional harm upon vulnerable young women, is held accountable for his depraved acts,” said Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee. “We will continue to prosecute those who engage in such reprehensible conduct.”
At the trial, victims recounted a series of violent acts perpetrated by Yarbrough to coerce them into prostituting for him, including beatings with belts, wooden coat hangers, crowbars, padlocks attached to belts, and dog chains. They also testified to being thrown down stairs, having their heads smashed into car doors, having their legs burned with irons, and being scalded with boiling water.
“The horrific physical violence, sexual abuse, and emotional torment suffered by the victims in this case cannot be undone, but this sentence ensures that their violent and evil predator will face the consequences of his actions,” said A. Todd McCall, Special Agent in Charge of the Memphis Division of the Federal Bureau of Investigation. “The efforts of the FBI and our law enforcement partners have removed a human trafficker from our streets. We will continue to work together to aggressively pursue and bring to justice those who cruelly exploit others for profit, and to restore the rights and dignity of human trafficking victims.”
Evidence presented at trial included the testimony of 10 victims identified in the indictment, as well as several eyewitnesses and investigators. Numerous witnesses testified that Yarbrough repeatedly enticed vulnerable women as young as 15 years old into prostitution with false promises of love, family, and prosperity. Any time a victim refused to engage in prostitution, he resorted to threats, intimidation, and violence. The jury heard testimony that Yarbrough’s pattern of recruitment, exploitation, and violent coercion continued for years before his 2009 arrest in St. Louis.
One of the victims testified that Yarbrough forced her to engage in prostitution the entire time she was pregnant with his child. He frequently beat her on the stomach when she did not want to comply with his demands. He forced her to work as a prostitute in Tunica, MS in her eighth month of pregnancy and induced her labor through a severe beating. Yarbrough drove her back to Memphis and dropped her off at a hospital. The day after she left the hospital following childbirth, Yarbrough forced her to resume prostituting. Sometime later, Yarbrough smashed her on the head with a lamp and kicked out her front teeth when she tried to stop prostituting for him.
Another victim testified that Yarbrough lured her into prostitution by promising to reunite her with their children, and then beat her severely when she insisted on seeing them and refused to continue working. Yarbrough punched her in the face so hard he broke three of her teeth. On another occasion, he beat her knees with a metal pipe and caused injuries that continue to affect her. She also testified that Yarbrough threatened to prostitute their nine-year-old daughter.
The jury heard testimony that one exhausted victim slept through a phone call from a client after serving prostitution clients for days on end with almost no sleep. When Yarbrough found out she missed the call, he smashed her head into a car door, dragged her by the hair to his hotel room, and beat her with his belt. Jurors saw a letter addressed to that victim and signed by Terrence Yarbrough stating that he was proud of how she did not scream while he beat her with the belt.
Witnesses testified that Yarbrough bragged about his beatings of some victims to other victims to let them know what would happen to them if they disobeyed him. Jurors also saw the “T-Rex” logos Yarbrough tattooed on four separate victims, and heard that he claimed that they had been “branded” as his property. Testimony and jail recordings showed that Yarbrough confiscated his victims’ identification documents as well as all their money to make it difficult for them to escape.
Jurors also heard testimony that Yarbrough conspired with his mother, Norma Yarbrough Webb, 66, and Michelle Johnson, 41, to fraudulently obtain food stamp benefits while Yarbrough was incarcerated. Johnson and Webb previously pled guilty to related charges.
“The USDA-Office of Inspector General is committed to the investigation and prosecution of those individuals who fraudulently obtain food stamp benefits. We are very pleased we were able to work with the U.S. Attorney's Office and other law enforcement agencies in this case,” stated Karen Citizen-Wilcox, Special Agent-in-Charge of the Southeast Region for the U.S. Department of Agriculture’s Office of Inspector General.
The case was investigated by the FBI and the U.S. Department of Agriculture Office of Inspector General, with assistance from the St. Louis Police Department. Assistant U.S. Attorney Jonathan Skrmetti and Trial Attorney Benjamin J. Hawk of the United States Department of Justice Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted the case.New York Political Consultant Is Charged in White Plains Federal Court with Defrauding the New York Democratic Senate Campaign Committee and Other FraudsRead the Press Release
Preet Bharara, United States Attorney for the Southern District of New York, and Toni Weirauch, the Special Agent-in-Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced today the unsealing of a nine-count Complaint charging New York political consultant MELVIN LOWE with fraud and tax violations. The Complaint alleges that LOWE defrauded the New York Democratic Senate Campaign Committee ("DSCC") and its contributors of $100,000 by causing a vendor to submit a false invoice for printing services to the DSCC. According to the Complaint, LOWE instructed the vendor to send $75,000 of the proceeds to LOWE and $20,000 to a political consultant and to keep $5,000 for himself. The Complaint further alleges that the $20,000 payment came days after a State Senator promised to pay a benefit to the consultant for assistance the consultant had previously provided to the Senator. In addition to this fraud charge, the Complaint charges LOWE with income tax violations for his failure to report more than $2 million in consulting income. He is also charged with causing his bank to make a false statement to his mortgage lender, and also for defrauding a Yonkers resident of $66,000. LOWE was arrested this morning and will be presented later today before United States Magistrate Judge Paul E. Davison in White Plains federal court.
Manhattan U.S. Attorney Preet Bharara stated: “Today’s Complaint alleges that New York's culture of political corruption extends beyond elected officials to the relatively unknown professional political insiders who work behind the scenes to carry out corrupt schemes. Our investigation will continue and we will continue bringing to justice every corrupt official we find, as well as those who allegedly execute their unlawful plots."
IRS-CI Special Agent-in-Charge Toni Weirauch stated: “Elected politicians and others involved in the political process, such as political consultants and insiders, must comply with the same laws as the rest of the American public. IRS-Criminal Investigation investigates tax crimes and other financial crimes to ensure that those who are involved in making the rules, directly or indirectly, are held accountable when they do not follow them.”
According to the allegations in the Complaint unsealed today in White Plains federal court:
Fraud on the Democratic Senate Campaign Committee
In June 2010, MELVIN LOWE, a political consultant who had been retained by the DSCC, caused a New Jersey based political consulting firm (the "Vendor") to submit to the DSCC a false invoice for printing services in the total amount of $100,000. LOWE told a representative of the Vendor to send a total of $75,000 to a bank account held by one of LOWE's companies, $20,000 to another New York political consultant (the "Consultant") and to keep $5,000 for himself. The Complaint alleges further that LOWE used the $75,000 he received to pay for the installation of a pool and other renovations at his second home in Georgia and to give $5,000 to a Manhattan community board member.
The Complaint charges that the Consultant received the $20,000 wire transfer from the Vendor several days after a State Senator, identified as "Senator #1," promised the Consultant a benefit for assistance that the Consultant previously had provided to the Senator. The Consultant, who is further described as a former staff member to elected officials in New York City, did not know the Vendor, had done no work for the Vendor and was not owed any money by the DSCC. The Complaint alleges that days after the Senator promised the Consultant a benefit, the Consultant learned of the $20,000 deposit into his bank account in a telephone call from LOWE.
Tax Violations
The Complaint also charges LOWE with three counts of subscribing to false tax returns for each of the years 2007 through 2009 and three counts of failing to file tax returns for each of the years 2010 through 2012. In total, LOWE is charged with failing to report more than $2 million in income from consulting services over a period of six years.
False Statement in Connection with Mortgage Loan Application
The Complaint charges further that LOWE caused an employee of Commerce Bank to make a false statement to LOWE's mortgage lender regarding the balance of LOWE's checking account at Commerce Bank. In 2007, LOWE obtained a mortgage loan from Premium Capital in the principal amount of approximately $225,000 that was secured by his second home in Georgia. As part of the loan application process, LOWE signed a form in which he represented that he had more than $80,000 in his checking account at Commerce Bank and authorized Commerce Bank to confirm that balance, as well as the average balance in the account over the previous two months, to Premium Capital. LOWE then asked an Assistant Manager at his local Commerce Bank branch to confirm that he had more than $80,000 in his checking account. The Assistant Manager did so, despite the fact that LOWE had less than $2,200 in that account at that time. The Complaint alleges that LOWE's fraudulently inflated checking account balance was a material misstatement in that it allowed LOWE to appear to have a positive net worth when, in fact, LOWE had a negative net worth at the time he closed on his mortgage loan. LOWE's mortgage loan balance remains above $225,000 today and the loan is now in foreclosure.
Fraud on Yonkers Resident
The Complaint alleges that LOWE also defrauded a Yonkers resident who is identified as "John Doe," of $66,000. LOWE told John Doe that he needed $66,000 in connection with his purchase of his second home in Georgia and that he would repay the loan within a few days. When John Doe asked LOWE to repay the loan, LOWE gave John Doe a check that was returned due to insufficient funds. Thereafter, LOWE promised to repay the loan at various times but failed to do so. He told John Doe on multiple occasions that he did not have the money to repay the loan when he, in fact, did have the money, the Complaint alleges.
LOWE, 52, of New York City, faces upon conviction a maximum sentence of 20 years' imprisonment on the count charging wire fraud in connection with the scheme to defraud the DSCC; a maximum sentence of 30 years' imprisonment on the count charging him with causing an employee of a federally insured bank to make a false report; a maximum of three years' imprisonment on each of the three counts charging him with subscribing to false tax returns; a maximum of one year's imprisonment on each of the three counts charging him with failure to file tax returns; and a maximum of 20 years' imprisonment on the count charging wire fraud in connection with the scheme to defraud the Yonkers resident.
Mr. Bharara praised the investigative work of IRS-CI and the investigators from the United States Attorney's Office for the Southern District of New York.
This prosecution is being handled by the Office's White Plains Division. Assistant U.S. Attorneys Perry A. Carbone and James McMahon are in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
LoweMelvin.Complaint
Navajo Man Sentenced to 141 Months for Home InvasionRead the Press Release
PHOENIX– On Oct. 25, 2013, Lee Kinder Tso, 51, of Many Farms, Ariz., and a member of the Navajo Nation, was sentenced by U.S. District Judge Neil V. Wake to 141 months in federal prison. He had previously pleaded guilty on March 15, 2013, to assault with a dangerous weapon and brandishing a firearm in furtherance of a crime of violence
On Feb. 3, 2012, Tso used his rifle to shoot two victims in the chest, causing serious injuries to the victims. He was angry with the victims because he believed they harmed his nephews earlier in the day. Tso and others drove to a residence and shot one victim in the chest after he answered the door. The second victim came out of a bedroom, and Tso also shot him in the chest. Both victims survived following lengthy hospitalizations and multiple surgeries.
The investigation in this case was conducted by the Federal Bureau of Investigation and the Navajo Nation Police Department. The prosecution was handled by Jennifer E. Green, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-08051-PHX-NVW
RELEASE NUMBER: 2013-082_TsoFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Mingo Pill Dealer Sentenced to 4 Years in Federal Prison for Oxycodone ConspiracyRead the Press Release
Napier illegally mailed package containing oxycodone tablets, arrested by undercover officer
CHARLESTON, W.Va. – A Mingo County man who mailed a package that contained more than 1,700 oxycodone pills was sentenced to four years in federal prison, U.S. Attorney Booth Goodwin announced today. Patrick Warren Napier, 41, of Dingess, W.Va., previously pleaded guilty in July to conspiracy to distribute oxycodone. On April 29, 2011, investigators with the United States Postal Inspection Service intercepted a package in Peach Creek, W.Va. The package, which contained 1,789 30-milligram oxycodone tablets, had been mailed by Napier. The package was intended for his associate, Michael Fortuna. Napier told investigators that he mailed the package containing the oxycodone and expected to be paid once the pills were sold.
Napier also told investigators that he obtained oxycodone pills from a source of supply located in Florida beginning in April 2011.
Michael Ray Fortuna, 45, of Peach Creek, Logan County, W.Va., previously pleaded guilty in January to conspiracy to distribute oxycodone. Fortuna faces up to 20 years in prison when he is sentenced on November 19, 2013.
The United States Postal Inspection Service, the Drug Enforcement Administration and the Logan County Sheriff’s Department conducted the investigation. Assistant United States Attorney Joshua Hanks handled the prosecution. The sentence was imposed by United States District Judge Thomas E. Johnston.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Mingo Pill Dealer Sentenced to 4 Years in Federal Prison for Oxycodone ConspiracyRead the Press Release
Napier illegally mailed package containing oxycodone tablets, arrested by undercover officer
CHARLESTON, W.Va. – A Mingo County man who mailed a package that contained more than 1,700 oxycodone pills was sentenced to four years in federal prison, U.S. Attorney Booth Goodwin announced today. Patrick Warren Napier, 41, of Dingess, W.Va., previously pleaded guilty in July to conspiracy to distribute oxycodone. On April 29, 2011, investigators with the United States Postal Inspection Service intercepted a package in Peach Creek, W.Va. The package, which contained 1,789 30-milligram oxycodone tablets, had been mailed by Napier. The package was intended for his associate, Michael Fortuna. Napier told investigators that he mailed the package containing the oxycodone and expected to be paid once the pills were sold.
Napier also told investigators that he obtained oxycodone pills from a source of supply located in Florida beginning in April 2011.
Michael Ray Fortuna, 45, of Peach Creek, Logan County, W.Va., previously pleaded guilty in January to conspiracy to distribute oxycodone. Fortuna faces up to 20 years in prison when he is sentenced on November 19, 2013.
The United States Postal Inspection Service, the Drug Enforcement Administration and the Logan County Sheriff’s Department conducted the investigation. Assistant United States Attorney Joshua Hanks handled the prosecution. The sentence was imposed by United States District Judge Thomas E. Johnston.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Mexican Truck Driver Sentenced to 120 Months for Drug Trafficking with Wooden-HampersRead the Press Release
LAREDO, Texas – Mexican national Moises Rodriguez-Ortega, 36, has been ordered to federal prison for 10 years for possessing with intent to distribute almost 10 kilograms of methamphetamine, announced United States Attorney Kenneth Magidson. Rodriguez-Ortega pleaded guilty July 8, 2013.
Today, U.S. District Judge Diana Saldana handed Rodriguez-Ortega the total 120-month-term of federal imprisonment. As a non-U.S. citizen, he is expected to face deportation proceedings following release from prison.
On May 21, 2013, Rodriguez-Ortega was arrested at the Columbia Solidarity International Bridge in Laredo after applying for admission into the United States. He was driving a tractor-trailer, and upon inspection by United States Customs and Border Protection (CBP) agents, was referred to secondary inspection for further investigation.
CBP agents discovered methamphetamine inside his tractor cab. Agents had located wooden-wicker hampers and drug dogs alerted to the presence of narcotics. Upon X-ray examination of these hampers, CBP agents discovered and extracted approximately 9.4 kilograms of methamphetamine from the wooden frames. Upon questioning, Rodriguez-Ortega admitted to smuggling the narcotics into the United Stated with the intention to traffic and sell these drugs throughout the United States.
The case was investigated by Homeland Security Investigations (HSI) and CBP. Assistant U.S. Attorney Sanjeev Bhasker is prosecuting.
Mercer County, N.J., Man Pleads Guilty to Production of Child PornographyRead the Press Release
TRENTON, N.J. – A Mercer County, N.J., man today admitted producing images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Fredy Arbito, 31, of Hightstown, N.J., pleaded guilty before U.S. District Judge Michael A. Shipp to an information charging him with one count of production of child pornography.
According to documents filed in this case and statements made in court:
From July 2011 to Jan. 28, 2013, Arbito knowingly coerced an 11-year-old girl to engage in sexually explicit conduct for the purpose of transmitting it live over the internet.
The production of child pornography charge to which Arbito pleaded guilty is punishable by a maximum potential penalty of 30 years in prison, with a mandatory minimum of 15 years in prison and a $250,000 fine. Sentencing is scheduled for Feb. 4, 2013.
U.S. Attorney Fishman praised special agents of the Department of Homeland Security’s Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees, with the investigation leading to today’s charges.
The government is represented by Assistant U.S. Attorney R. Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.
13-421Defense counsel: James R. Lisa Esq., Jersey City, N.J.
Arbito, Fredy Information
Massachusetts Man Sentenced to 30 Months for Making Hoax Emergency Services CallsRead the Press Release
A Massachusetts man was sentenced to serve 30 months in prison today for engaging in an illegal practice known as “swatting,” in which he made hoax emergency telephone calls reporting an ongoing, dangerous crime to elicit an armed police response from a SWAT team to a specific location, typically in order to harass someone he believed was at the location.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Carmen M. Ortiz of the District of Massachusetts made the announcement after sentencing by U.S. District Court Judge Timothy Hillman.
Nathan Hanshaw, 22, of Athol, Mass., pleaded guilty on Aug. 30, 2013, to a three-count information charging him with one count of making interstate threats, one count of threats to use explosives and one count of threats to use a firearm.According court records, Hanshaw typically claimed in his swatting calls that he was a fugitive who was wanted by the authorities; that he was armed with weapons, explosives and nerve agents; and that he had taken hostages. He demanded cash and a helicopter ride to Mexico and threatened to detonate his bombs and kill his hostages if his demands were not met. He also threatened to kill any law enforcement personnel who arrived at the location. Hanshaw generally claimed to be, and, because he used techniques to disguise his location, appeared to be, calling from an address that, unbeknownst to the law enforcement officers responding to the call, was the address of his intended swatting victim.
At the change of plea hearing in August, prosecutors told the court that, had the case proceeded to trial, the government would have proven that, from September 2012 through mid-January 2013, Hanshaw made swatting calls to emergency services numbers across the United States, including Denver; Ventura, Calif.; and Waverly, N.Y. In each case, armed police responses ensued. In response to Hanshaw’s swatting call to Ventura, for example, more than 40 local and federal officers arrived at the purported crime scene, a hotel was evacuated, and nearby streets were closed for several hours. His activities created a serious risk of physical harm to innocent victims and caused extensive disruptions to important public services.
The case was investigated by the FBI and is being prosecuted by Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam Bookbinder of the District of Massachusetts’ Computer Crimes Unit.
Massachusetts Man Sentenced for Making Hoax Emergency Services Calls to Elicit Swat Team ResponseRead the Press Release
BOSTON – An Athol, Mass., man was sentenced today for engaging in an illegal practice known as “swatting,” in which he made hoax emergency telephone calls and falsely reported an ongoing, dangerous crime in order to elicit an armed police response (from a SWAT team) to a specific location, typically in order to harass someone he believed was there.
Nathan Hanshaw, 22, was sentenced to 30 months in prison by U.S. District Court Judge Timothy Hillman as agreed upon in the plea agreement. In August 2013, Hanshaw pleaded guilty to a three-count information charging him with making interstate threats, threats to use explosives, and threats to use a firearm.
Hanshaw, in his swatting calls, typically claimed that he was a fugitive who was wanted by the authorities, was armed with weapons, explosives, and nerve agents, and that he had taken hostages. He demanded cash and a helicopter ride to Mexico and threatened to detonate his bombs and kill his hostages if his demands were not met. He also threatened to kill any law enforcement personnel who arrived at the location. Hanshaw generally claimed to be calling from an address that, unbeknownst to the law enforcement officers responding to the call, was the address of his intended swatting victim
From September 2012 through mid-January 2013, Hanshaw made swatting calls to emergency services numbers across the United States, including Denver, Colorado; Ventura, California; and Waverly, New York. In each case, armed police responses ensued. In response to Hanshaw’s swatting call to Ventura, California, for example, more than 40 local and federal officers arrived at the purported crime scene, a hotel was evacuated, and nearby streets were closed for several hours. His “swatting” activities created a serious risk of physical harm to innocent victims and caused extensive disruptions to important public services.
Acting Assistant Attorney General Mythli Raman and United States Attorney Carmen M. Ortiz made the announcement today. The case was investigated by the Federal Bureau of Investigation with significant assistance from the Massachusetts State Police and the Ventura Country Sherriff’s Department. The case is being prosecuted by Trial Attorney Mona Sedky of the Department of Justice’s Computer Crime and Intellectual Property Section, Criminal Division, and Assistant U.S. Attorney Adam Bookbinder in Ortiz’s Computer Crimes Unit.
Las Cruces Man Sentenced to Twenty Years in Federal Prison for Methamphetamine Trafficking and Firearms ConvictionRead the Press Release
ALBUQUERQUE – Mark Anthony Harriman, 45, of Las Cruces, N.M., was sentenced this morning in Las Cruces federal court to 20 years in federal prison followed by five years of supervised release for his drug trafficking and firearms conviction.
The sentence was announced by Acting U.S. Attorney Steven C. Yarbrough, Special Agent in Charge Joseph M. Arabit of the El Paso Division of the DEA, Special Agent in Charge Bobby Holden of the Las Cruces/Doña Ana County Metro Narcotics Agency and New Mexico State Police Chief Pete N. Kassetas.
Harriman and Agustin Abascal, 27, also of Las Cruces, were arrested in April 2013 based on a criminal complaint charging them with conspiracy to distribute methamphetamine in Doña Ana County, N.M., between Nov. 2012 and March 2013. According to the complaint, Harriman and Abascal sold quantities of methamphetamine to a New Mexico State Police officer and a DEA informant who were acting in undercover capacities during the five month period. Both men have been in federal custody since their arrests.
Harriman pled guilty in July 2013 to a two-count felony information charging him with possession of methamphetamine with intent to distribute and being a felon in possession of a firearm. In entering his guilty plea, Harriman admitted that between Feb. 26, 2013 and March 14, 2013, he obtained methamphetamine from California and sold it in Las Cruces. Harriman also admitted selling an ounce of methamphetamine to an informant on Feb. 26, 2013. He further admitted that he was traveling back from California with two ounces of methamphetamine when he was arrested in this case.
Harriman also admitted that, when federal agents executed a search warrant at his residence, they seized nine firearms and large amounts of ammunition that belonged to him. Harriman acknowledged that he was prohibited from possessing firearms or ammunition because he previously was convicted of two felony offenses. Under the terms of his plea agreement, Harriman agreed to forfeit the firearms and more than 1000 rounds of ammunition seized from his residence in addition to $13,940 in cash.
Abascal also entered a guilty plea in July 2013. He pled guilty to a one-count felony information charging him with distribution of methamphetamine and admitted selling methamphetamine to an undercover officer on five separate occasions between Nov. 1, 2012 and March 7, 2013. Abascal faces a term of ten years to life in prison when he is sentenced. His sentencing hearing has yet to be scheduled.
This case was investigated by the Las Cruces office of the DEA, the Las Cruces/Doña Ana County Metro Narcotics Agency and the New Mexico State Police, and is being prosecuted by Assistant U.S. Attorney Renee L. Camacho of the U.S. Attorney’s Las Cruces Branch Office.
Lafayette Man Sentenced to 121 Months in Prison for Possession of Child PornographyRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that Ray Hatton III, 31, of Lafayette, was sentenced by U.S. District Judge Richard T. Haik to 121 months in prison and a lifetime of supervised release for possessing child pornography with some of the images involving infants. He pleaded guilty May 13, 2013.According to the evidence presented at the guilty plea, law enforcement authorities determined that Hatton was downloading child pornography using an internet file sharing program. After obtaining a warrant, authorities searched his residence on March 8, 2012, and seized the defendant’s computer. Hatton was found to have downloaded 10 videos of child pornography. Some of the pornography depicted infants and very young children.
“This defendant admitted to downloading one of the most despicable types of child pornography produced,” Finley stated. “Those who download and possess child pornography will be prosecuted to the fullest extent of the law. I hope this serves as a deterrent to anyone seeking to acquire this type of material.”
The Lafayette Police Department and the Department of Homeland Security conducted the investigation. This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) DHS-2ICE. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp.
Assistant U.S. Attorney John Luke Walker prosecuted the case.
Lackawanna Store Owner Sentenced for Food Stamp FraudRead the Press Release
BUFFALO, N.Y. – U.S. Attorney William J. Hochul, Jr. announced today that Tofeek Albanna, 37, of Lackawanna, N.Y., who was convicted of food stamp fraud, was sentenced to 15 months in prison by U.S. District Court Judge Richard J. Arcara. The defendant was also ordered to pay $73,400 in restitution to the United States Department of Agriculture, which administers the federal government’s Supplemental Nutrition Assistance Program (“SNAP”), previously known as the Food Stamp Program.
Assistant U.S. Attorneys Robert C. Moscati and John E. Rogowski, who handled the prosecution of this case, stated that Albanna owned and operated LA Fashions on Holland Avenue in Lackawanna. Albanna primarily stocked clothing items along with a few food items in the store. The SNAP program requires that those receiving benefits purchase certain approved food items. Despite selling mostly clothing items, between February 2009 and April 2010, the defendant redeemed over $100,000 in SNAP benefits.
A lengthy investigation by state and federal law enforcement revealed that Albanna routinely sold clothing items to customers in exchange for SNAP benefits. In addition, the defendant paid cash, for a significant premium, for SNAP credits. The investigation, which utilized undercover officers who purchased clothing items with SNAP benefits, determined that the defendant fraudulently redeemed $73,400 in SNAP benefits.
The sentencing is the culmination of an investigation on the part of Special Agents of the United States Department of Agriculture, Office of Inspector General, Special Agents of the Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero, the Federal Bureau of Investigation, under the direction of Special Agent in Charge Brian P. Boetig, and the New York State Police, under the direction of Major Michael Cerretto.Kewa Pueblo Man Sentenced to Twenty-Four Months in Federal Prison for Child Sexual Abuse ConvictionRead the Press Release
ALBUQUERQUE – Calvin Tenorio, Sr., 65, a member and resident of Kewa Pueblo, was sentenced this afternoon to 24 months in federal prison followed by five years of supervised release for his child sex abuse conviction. Tenorio will be required to register as a sex offender when he completes his prison sentence.
Tenorio was arrested on Jan. 10, 2013, based on a criminal complaint charging him with abusive sexual contact with a minor and subsequently was indicted on that same charge. According to the indictment, Tenorio sexually assaulted a child who had not attained the age of 12 years on Nov. 28, 2012, by touching the child’s clothed genitals.
According to court filings, a member of the child’s family reported the sexual assault to Kewa Pueblo officials on Nov. 28, 2012, and the Pueblo officials promptly referred the report to the BIA for investigation. After preliminary investigation, the BIA arrested Tenorio on tribal charges and referred the matter to the FBI for further investigation. Tenorio remained in tribal custody until his arrest on federal charges and has been in federal custody since that time.
On April 9, 2013, Tenorio pled guilty to the indictment without the benefit of a plea agreement. During his plea hearing, Tenorio admitted sexually assaulting a child under 12 years of age in a residence located in Kewa Pueblo.
This case was investigated by the Albuquerque and Santa Fe offices of the FBI and the Southern Pueblos Agency of the BIA’s Office of Justice Services. The case was prosecuted by Assistant U.S. Attorney Elaine Y. Ramirez as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Justice Department and the Commonwealth of Puerto Rico <br /> Jointly Select Juan Mattos Jr. to Oversee Reform of the Puerto Rico Police DepartmentRead the Press Release
The Justice Department announced today that, jointly with the Commonwealth of Puerto Rico, it is moving in the U.S. District Court for the appointment of Juan Mattos Jr. as Technical Compliance Advisor (TCA). Mattos will be responsible for evaluating the implementation of a comprehensive settlement agreement to reform the Puerto Rico Police Department (PRPD). He will begin his term as TCA pursuant to appointment by U.S. District Court Judge Gustavo A. Gelpí.
Under the agreement, the TCA will assist in determining whether the terms of the reform plan have been fully implemented in a timely manner. The TCA’s assessment will include a thorough review of PRPD’s policies, training curricula, standard operating procedures, plans, protocols and other operational documents related to the agreement. The TCA will also assess whether the implementation of the agreement results in constitutional policing, increased community trust and the professional treatment of individuals by PRPD officers. To this end, the TCA will engage community stakeholders including representatives of civic and community organizations, minority communities, lesbian, bisexual, gay, transgender and transsexual communities, student and labor groups, civil rights organizations, and women’s advocacy groups to ensure they have a voice in the reform process. The TCA will also assess and report on PRPD’s compliance, as well as provide technical assistance to promote constitutional policing. Once appointed, Mattos will assist PRPD officials with the development of action plans to modernize its administrative systems and professionalize its police force.
The parties jointly selected Mattos to serve as TCA given his extensive experience in law enforcement and his efforts in the successful implementation of a federal consent decree. Mattos is a career law enforcement officer with nearly 40 years of service in the New Jersey State Police (NJSP) and the United States Marshals Service. During his tenure with the NJSP, Mattos served as a state trooper, an equal employment opportunity/affirmative action officer, as Commandant of the NJSP Academy and as Commander of both the Division Staff and Intelligence Services Sections. Mattos also actively supervised the efforts of the NJSP to comply with a 1999 consent decree related to racial profiling. Under his leadership, the NJSP received national recognition for its patrol practices and procedures. Following his retirement from the NJSP, Mattos joined the Middlesex County Prosecutor’s Office where he oversaw the development of policies and procedures for the office’s Bias Crime Unit and established a community outreach initiative with minority community leaders and advocacy groups in Middlesex County. Currently, Mattos serves as the U.S. Marshal for the District of New Jersey, having been appointed to the position by President Obama in July 2011. Mattos intends to hire several other experienced law enforcement professionals to assist him in assessing compliance with the agreement.
“We are pleased to have worked collaboratively with the Commonwealth to select Mr. Mattos, who we believe is uniquely positioned to assess and report on the Puerto Rico Police Department’s reform efforts,” said Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division. “We look forward to working with Mr. Mattos, the Commonwealth of Puerto Rico and the community to ensure effective and constitutional policing throughout the commonwealth.”
A copy of the complaint, the final agreement and the September 2011 letter of findings can be found at www.justice.gov/crt If individuals have information that is relevant to the case and PRPD, you may contact the Department of Justice at [email protected] or at 877-871-9726.
Justice Department Files Lawsuit in Massachusetts AgainstIron Workers Union Trustees and Pension Fund to Enforce the Employment Rights of Navy Reserve MemberRead the Press Release
The Civil Rights Division and U.S. Attorney Carmen M. Ortiz announced today the filing of a complaint alleging that the Iron Workers District Council of New England Pension Fund (the Pension Fund) and the Trustees of the Iron Workers District Council of New England Pension Fund (the Trustees) willfully violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) by failing to credit U.S. Navy Reserve Member Thomas Shea, a member of the International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, Local 7 (the Union), with service time while he was serving in the armed forces in Afghanistan. The suit was filed in the Federal District Court for the District of Massachusetts.
USERRA requires that service members who leave their civilian jobs to serve in the military be treated as not having incurred a break in service with regard to their pension plans. USERRA further provides that each period served by a person in the uniformed services shall upon reemployment be deemed to constitute service with the employer(s) maintaining the plan for the purpose of determining the nonforfeitabilty of the person's accrued benefits and for the purpose of determining the accrual of benefits under the plan.
The complaint alleges that the Pension Fund and the trustees violated USERRA by refusing to grant Shea pension credits that he earned while on military duty unless and until he worked at least 300 hours in the one year period following his discharge from the military and accrued 2.5 pension credits, which is equal to 3,000 hours, in the subsequent five year period following his release from active duty. Both of these requirements exceed those placed on members of the Pension Fund who do not take military leave and therefore violate USERRA. The complaint also seeks back payment of annuity contributions that were not made while Shea was on active duty.
“Congress enacted USERRA to protect our men and women in uniform from experiencing exactly this kind of injustice,” said Jocelyn Samuels, Acting Assistant Attorney General for the Department of Justice’s Civil Rights Division. “The Justice Department is committed to vigorously enforcing federal laws that protect the employment rights of our service members.”
“Reservists who are called to active duty sacrifice time away from their jobs to serve their country,” said Ortiz. “USERRA ensures that they are not discriminated against after they have returned from service and that their employment rights are protected. We are committed to vigorously enforcing USERRA’s protections.”
"It is important for all employers and their organizations to realize that the Labor Department is here to protect the employment and reemployment rights of American service members under USERRA," said Assistant Secretary Keith Kelly of the Veterans' Employment and Training Service. "We owe these brave Americans every protection when they return from their military obligations."
The U.S. Department of Labor’s (DOL) Veterans’ Employment and Training Service investigated Shea’s allegations with the assistance of the DOL’s Office of Regional Solicitor. This case is being handled jointly by the Civil Rights Division and the U.S. Attorney’s Office for the District of Massachusetts.
Additional information about USERRA can be found on the Justice Department website: www.servicemembers.gov and www.usdoj.gov/crt/emp, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
Justice Department Files Lawsuit Against Iron Workers Union and Pension Fund to Enforce the Employment Rights of Navy Reserve MemberRead the Press Release
BOSTON - The Civil Rights Division and U.S. Attorney Carmen M. Ortiz announced today the filing of a complaint alleging that the Iron Workers District Council of New England Pension Fund (the Pension Fund) and the Trustees of the Iron Workers District Council of New England Pension Fund (the Trustees) willfully violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) by failing to credit U.S. Navy Reserve Member Thomas Shea, a member of the International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers, Local 7 (the Union), with service time while he was serving in the armed forces in Afghanistan. The suit was filed in the Federal District Court for the District of Massachusetts.
USERRA requires that service members who leave their civilian jobs to serve in the military be treated as not having incurred a break in service with regard to their pension plans. USERRA further provides that each period served by a person in the uniformed services shall, upon reemployment, be deemed to constitute service with the employer or employers maintaining the plan for the purpose of determining the nonforfeitability of the person's accrued benefits and for the purpose of determining the accrual of benefits under the plan.
The complaint alleges that the Pension Fund and the Trustees violated USERRA by refusing to grant Shea pension credits that he earned while on military duty unless and until he (1) worked at least 300 hours in the one-year period following his discharge from the military; and (2) accrued 2.5 pension credits, which is equal to 3,000 hours, in the subsequent five-year period following his release from active duty. Both of these requirements exceed the requirements placed on members of the Pension Fund who do not take military leave and therefore violate USERRA. The complaint also seeks back payment of annuity contributions that were not made while Shea was on active duty.
“Reservists who are called to active duty sacrifice time away from their jobs to serve their country,” said Ortiz. “USERRA ensures that they are not discriminated against after they have returned from service and their employment rights are protected. We are committed to vigorously enforcing USERRA’s protections.”
“It is important for all employers and their organizations to realize that the Labor Department is here to protect the employment and reemployment rights of American service members under USERRA,” said Assistant Secretary Keith Kelly of the Veterans' Employment and Training Service. “We owe these brave Americans every protection when they return from their military obligations.”
The U.S. Department of Labor’s Veterans Employment and Training Service investigated Shea’s allegations with the assistance of the Department of Labor’s Office of Regional Solicitor. This case is being handled jointly by the Civil Rights Division in Washington, D.C. and the U.S. Attorney’s Office for the District of Massachusetts.
Civil rights enforcement is a top priority of the Department of Justice and District of Massachusetts. Additional information about USERRA can be found on the Justice Department website: www.servicemembers.gov and www.usdoj.gov/crt/emp, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm
Justice Department Asks Federal Court to Shut DownNorth Mississippi Tax PreparerRead the Press Release
Holly Springs Tax Preparers Allegedly File Fraudulent Tax Returns for Customers
The United States has sued Eric Hardaway, aka Eric Brittenum, and Yvonne Hardaway, seeking to bar them and their business, Hardaway Taxx, from preparing federal tax returns for others, the Justice Department announced today.
The civil injunction complaint, filed in U.S. District Court for the Northern District of Mississippi, alleges that the Hardaways, of Holly Springs, Miss., have prepared federal income tax returns for customers that fraudulently understated their tax liabilities or overstated refunds by claiming frivolous fuel tax credits. According to the complaint, an Internal Revenue Service (IRS) investigation revealed that 156 income tax returns prepared by the Hardaways and audited by the IRS resulted in tax deficiencies. The lawsuit alleges that the tax harm caused by the Hardaways’ misconduct exceeds $321,000 in erroneous refunds issued to taxpayers.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2013, which can be viewed at www.irs.gov/uac/Newsroom/IRS-Releases-the-Dirty-Dozen-Tax-Scams-for-2013 . The IRS has tips for choosing a tax preparer: www.irs.gov/Tax-Professionals/Choosing-a-Tax-Professional . In the past ten years, the Justice Department's Tax Division has obtained injunctions against hundreds of unscrupulous tax-return preparers. Information about these cases is available on the Justice Department Website at www.justice.gov/tax/taxpress2013.htm .
Related Materials:
United States v. Eric Hardaway, etc. et al.
Complaint for Permanent Injunction and Other Relief
Jicarilla Apache Woman Pleads Guilty to Being an Accessory to Sex Abuse Involving a Navajo ChildRead the Press Release
ALBUQUERQUE – Rosabelle Ben, 58, a member of the Jicarilla Apache Nation who resides in Shiprock, N.M., pleaded guilty this afternoon to being an accessory to the sexual abuse of a minor. Under the terms of her plea agreement, Rosabelle Ben will be sentenced to a federal prison term within the range of two to five years followed by a term of supervised release to be determined by the court. Rosabelle Ben will be required to register as a sex offender when she completes her prison sentence.
Rosabelle Ben and co-defendants Herbert Ben, Sr., 63, a member of the Navajo Nation who resides in Shiprock, and Bruce Hamilton, 77, a non-native resident of Shiprock, were arrested in May 2012, based on a criminal complaint alleging child sex abuse offenses. All three subsequently were indicted and charged with sexual abuse of a child between the age of 12 and 16 years, and aiding and abetting the sexual abuse of a child.
In her plea agreement, Rosabelle Ben admitted that between Aug. 1, 2010 and Dec. 11, 2011, she made a child between the ages of 12 and 15 available to Hamilton so that Hamilton could engage in a sexual act with the child. Rosabelle Ben further admitted that Hamilton paid her with money and alcohol for making the child victim available to him. She further admitted that the offense occurred on the Navajo Indian Reservation.
Herbert Ben, Sr., pled guilty on July 31, 2013, to sexual abuse of a minor and admitted that, on a date between Aug. 2010 and Dec. 2011, he sexually abused a minor at a location within the Navajo Reservation. Hamilton pled guilty on Aug. 19, 2013, to sexually abusing a minor and admitted sexually abusing a Navajo child between the age of 12 and 15 on a date between Aug. 2010 and Dec. 2011. Both men admitted committing these crimes on the Navajo Indian Reservation. At sentencing, each man faces a federal prison term within the range of two to five years followed by a term of supervised release to be determined by the court. Each also will be required to register as a sex offender when he completes his prison sentence.
This case was investigated by the Farmington office of the FBI and the Shiprock office of the Navajo Nation Division of Public Safety. It is being prosecuted by Assistant U.S. Attorneys Jacob A. Wishard and Novaline D. Wilson as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Jackson Man Sentenced on Federal Drug ChargeRead the Press Release
Jackson, Miss. – Terrence Womack, 38, of Jackson, was sentenced today by U.S. District Judge Henry T. Wingate to 72 months in federal prison followed by five years of supervised release for possession with intent to distribute more than 28 grams of cocaine base (“crack”),announced U.S. Attorney Gregory K. Davis and FBI Special Agent in Charge Daniel McMullen. Womack was also ordered to pay restitution in the amount of $9,000 to the FBI.
Womack was indicted in connection with “Operation Paperchase”, an extensive investigation targeting illegal narcotics distribution in the City of Jackson. He pled guilty to the charge on July 28, 2013.
This case was investigated by the Federal Bureau of Investigation with assistance from the Drug Enforcement Administration, U.S. Marshals Service, Gulf Coast HIDTA, Organized Crime Drug Enforcement Task Force, Mississippi Bureau of Narcotics, Hinds County Sheriff’s Department, and Jackson Police Department. The case was prosecuted by Assistant United States Attorney Erin Chalk.###
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Informational: Federal Court Initial AppearancesRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on October 29, 2013, before U.S. Magistrate Judge Keith Strong, the following individuals were arraigned:
GEORGE THEODORE SUTHERLAND, a 20-year-old resident of Box Elder, appeared on a charge of assault resulting in serious bodily injury. He is currently detained. If convicted of this charge, he faces possible penalties of 10 years in prison, a $250,000 fine, and 3 years supervised release. Assistant U.S. Attorney Danna R. Jackson is the prosecutor for the United States. The investigation was conducted by the Federal Bureau of Investigation.
HAILEY LEE BELCOURT, age 35, and TONY JAMES BELCOURT, age 41, residents of Box Elder, and SHAD JAMES HUSTON, a 37-year-old resident of Havre, appeared on charges of conspiracy to embezzle/convert federal money, theft involving a federally funded program, and accepting bribes. They are currently released on special conditions. If convicted of these charges, they each face possible penalties of 10 years in prison, a $250,000 fine, and 3 years supervised release on multiple counts of the above charges. Assistant U.S. Attorney Carl E. Rostad is the prosecutor for the United States. The investigation was conducted by a team of agents and auditors working with the U.S. Attorney's Guardians Project, including the Office of Inspector General for the Department of Interior, the Federal Bureau of Investigation, and the Criminal Investigation Division of the Internal Revenue Service.
K & N CONSULTING, LLC and TMP SERVICES, LLC, of Havre, appeared on charges of conspiracy to embezzle/convert federal money, theft involving a federally funded program, and giving bribes. If convicted of these charges, they each face possible penalties of a $500,000 fine on each charge. Assistant U.S. Attorney Carl E. Rostad is the prosecutor for the United States. The investigation was conducted by a team of agents and auditors working with the U.S. Attorney's Guardians Project, including the Office of Inspector General for the Department of Interior, the Federal Bureau of Investigation, and the Criminal Investigation Division of the Internal Revenue Service.
TONY JAMES BELCOURT, age 41, and HUNTER BURNS, age 48, residents of Box Elder, and JAMES HOWARD EASTLICK, JR., a resident of Havre, appeared on charges of false claims conspiracy, false claim against a federally funded project, and theft from an Indian tribal organization receiving federal funds. They are currently released on special conditions. If convicted of these charges, they each face possible penalties of 10 years in prison, a $250,000 fine, and 3 years supervised release on multiple counts of the above charges. Assistant U.S. Attorney Carl E. Rostad is the prosecutor for the United States. The investigation was conducted by a team of agents and auditors working with the U.S. Attorney's Guardians Project, including the Office of Inspector General for the Department of Interior, the Federal Bureau of Investigation, and the Criminal Investigation Division of the Internal Revenue Service.
HUNTER BURNS CONSTRUCTION, LLC, of Havre, appeared on charges of false claims conspiracy, false claim against a federally funded project, and theft from an Indian tribal organization receiving federal funds. If convicted of these charges, the company faces possible penalties of a $500,000 fine on each charge. Assistant U.S. Attorney Carl E. Rostad is the prosecutor for the United States. The investigation was conducted by a team of agents and auditors working with the U.S. Attorney's Guardians Project, including the Office of Inspector General for the Department of Interior, the Federal Bureau of Investigation, and the Criminal Investigation Division of the Internal Revenue Service.
The defendants pled not guilty to the charges.
The charge, an indictment, information or complaint, is merely an accusation and all persons named as defendants are presumed innocent until proven guilty. A pre-trial conference and a trial date will be set and the United States will be required to prove the allegations set forth in the indictment beyond a reasonable doubt.
Indictments Charged Diversion of Hundered of Thousands of Oxycodone TablesRead the Press Release
Doctor’s Receptionist Is Alleged Key Player in Pill Scheme
The Eastern District of Pennsylvania, like the rest of the nation, has been greatly
impacted by the prescription drug abuse epidemic. Local clinics have stated that drug addiction
in both Philadelphia and New Jersey is extremely severe. Heroin and opiate-based prescription
medication – such as oxycodone – are two of the most abused drugs in this area. And just like
street drugs, prescription drug abuse produces the same problems: addiction, crime, and broken
families.
Today, federal agents arrested 27 people involved in a prescription drug conspiracy that
illegally distributed more than 380,000 Oxycodone pills into communities in the Eastern District
of Pennsylvania. Two indictments, charging four key players, and multiple other charging
documents were unsealed today. Charged in one indictment are Leon Little, 33, of Cherry Hill,
NJ, the leader of the “Little Drug Operation” (LDO), Heather Herzstein, 28, of Folcroft, PA, who
worked in a doctor’s office, and Colise Harmon, 34, of Philadelphia. They are charged with
conspiracy to distribute controlled substances. A separate but related indictment charges
Aminah Shabazz, 36, of Cherry Hill, NJ, with money laundering. Based on the average retail
sale price of the oxycodone tablets on the street, the LDO allegedly took in more than 3 million
dollars.
The charges were announced by First Assistant United States Attorney Louis Lappen,
Drug Enforcement Administration Special Agent-in-Charge David G. Dongilli, and IRS
Criminal Investigation Special Agent-in-Charge Akeia Conner. The announcement was made at
a press conference that also included the FBI and Health and Human Services Office of Inspector
General and discussed the larger issue of drug diversion.
According to the indictment, between August 2010 and August 2012, the LDO recruited
and paid individuals to pose as patients in order to acquire prescription drugs, such as oxycodone
and alprazolam (otherwise known as Xanax), from L.B., a licensed physician in Philadelphia.
Many of these “pseudo-patients” were recruited from the Raymond Rosen Projects, a
government-assisted housing development located in north Philadelphia. Little orchestrated the
entire scheme by allegedly paying Herzstein and Harmon to facilitate the coordination of
pseudo-patients. He also allegedly collected and stored the filled prescriptions, packaged the
drugs for re-distribution, and distributed to them to his customers in Philadelphia.
Hertzstein, as the receptionist and sole employee for L.B., allegedly scheduled the
pseudo-patients’ appointments, wrote prescriptions for oxycodone using the doctor’s prescription
pad and without the doctor’s consent, and distributed the forged prescriptions to the LDO. She
also allegedly falsely verified with pharmacies that the forged prescriptions received from LDO
pseudo-patients were legitimate. The pseudo-patients primarily received prescriptions for 10
milligram and 30 milligram tablets of oxycodone in exchange for money. The LDO also paid for
the doctor’s visit and the costs for filling the prescriptions.
Harmon allegedly drove pseudo patients to the doctor and to specific pharmacies in
Philadelphia, PA to have the prescriptions filled. The prescriptions were filled primarily at:
Northeast Pharmacy, 6730 Bustleton Avenue; Pharmacy of America, 1500 E. Erie Avenue; and
Philly Pharmacy, 210 Market Street.
In addition to the conspiracy, Little, Herzstein and Harmon are charged with distribution
of oxycodone, acquiring a controlled substance by fraud, and aiding and abetting.
According to the separate indictment, Aminah Shabazz took LDO drug proceeds and
provided $26,970 in cash to a third party who deposited the cash into the third party’s bank
account in Ridley, PA. The third party then received a certified check made out to Lemin
Consulting, LLC, a business operated by Shabazz and Little, for $27,000. Shabazz then
allegedly deposited the certified check into the bank account for Lemin Consulting, LLC in
Philadelphia, PA in an attempt to conceal the proceeds of unlawful activity.
If convicted of all charges, the defendants face the following possible prison terms under
advisory sentencing guideline ranges: Little, life; Harmon, life; Herzstein, life; Shabazz, 33
months to 41 months. The defendants also face possible fines and terms of supervised release.
The indictment is also seeking forfeiture.
The case was investigated by the Drug Enforcement Administration, Internal
Revenue Service Criminal Investigation Division, Federal Bureau of Investigation Health
Care Fraud Task Force, Philadelphia Police Department, and North Coventry Police
Department, and is being prosecuted by Assistant United States Attorney Tomika N.
Stevens.
“Prescription drug abuse has become an epidemic in our society, and with the
increased demand for these drugs has come the criminal activity that naturally follows –
including illegal drug distribution and violence,” said First Assistant United States
Attorney Louis Lappen. “The individuals charged today with drug trafficking face
lengthy prison terms like those imposed on distributors of street level drugs such as
heroin and cocaine. We will continue to work with our law enforcement partners to bring
illegal drug traffickers to justice and stem the tide of prescription drug abuse in our
communities.”
“The defendants charged today are drug dealers just like street dealers pushing
heroin and cocaine,” said DEA Special Agent-in-Charge Dongilli. “Each is driven by
greed and intent on making as much money as possible at any expense and with a total
disregard of others. The Drug Enforcement Administration (DEA) will continue to
aggressively investigate anyone engaged in obtaining or selling prescription controlled
substances outside of a legitimate doctor-patient or pharmacist relationship. There is a
dangerous misunderstanding about prescription drugs. In Pennsylvania more people die
from prescription drug overdoses than heroin or cocaine.”
“The laundering of illegal drug profits is as important and essential to drug
traffickers as the very distribution of their illegal drugs,” said IRS Special Agent-in-
Charge Conner. “Without these ill-gotten gains, the traffickers could not finance their
organizations. The role of IRS Criminal Investigation in narcotics investigations is to
follow the money so we can financially disrupt and dismantle major drug trafficking
organizations. IRS Criminal Investigation is proud to provide its financial expertise as we
work alongside our law enforcement partners to bring criminals to justice.”
“Drug diversion is a costly problem in this country – in both dollars, and lives,”
said FBI Special Agent in Charge Edward J. Hanko. “The FBI is fully committed to
investigating this fast-growing category of health care fraud.”
“Aside from the human casualties resulting from prescription drug diversion, the
millions of dollars stolen from insurance programs is eroding trust in our health care
system,” said Special Agent-in-Charge DiGiulio. “Our agents, working with federal and
local law enforcement, are finding a huge wave of illegal billing, identity theft, fraud in
the Medicare drug program, Medicaid, and other federal health insurance programs.”
Prescription drug abuse, despite popular misconceptions, has become more wide-spread,
more destructive, and more dangerous than even street-level drug abuse. Nearly seven million
Americans are hooked on prescription drugs, more than are addicted to cocaine, heroin,
hallucinogens, ecstasy, and inhalants combined. The web of prescription drug abuse entangles
the poor and the rich, the old and the young, and does not discriminate based on race. Abuse of
prescription narcotics has reached epidemic proportions in this country. According to the
Centers for Disease Control and Prevention (CDC), prescription drug abuse is the fastest
growing drug problem in the United States, with the number of prescription drug overdoses
tripling over the last 20 years.
A 2011 report by the CDC indicated that nearly 15,000 people die every year of
overdoses involving prescription painkillers, and 1 in 20 people reported using prescription drugs
for non-medical reasons during the prior year. Drug overdose, including overdose of
prescription drugs, is now the leading cause of accidental death in the United States, recently
surpassing automobile accidents. Nearly three out of four drug overdoses are caused by
prescription painkillers, which include oxycodone. For every overdose death caused by
prescription painkillers, there are 32 emergency room visits due to the misuse or abuse of
prescription drugs. In 2011, oxycodone products were the prescription painkiller most
commonly involved in emergency room visits.
There are more overdose deaths caused by prescription drugs than by heroin and cocaine
combined. Prescription narcotics are dealt hand-to-hand, just like baggies of heroin or vials of
crack. According to the CDC, 76% of non-medical prescription drug users acquired drugs that
had been prescribed to someone else.View: Defendant Chart.pdf | Little et. al., Indictment.pdf | Shabazz Indictment.pdf
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Illinois Man Arrested for Alleged Role in $12 Million Health Care Fraud SchemeRead the Press Release
A Rockford, Ill., man was arrested today in connection with an indictment charging three Chicago-area residents for their roles in an alleged $12 million health care fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Zachary Fardon of the Northern District of Illinois, Acting Special Agent in Charge Robert J. Shields Jr. of the FBI’s Chicago Office, and Special Agent in Charge Lamont Pugh III of the Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office made the announcement.
According to the 10-count indictment returned on Oct. 23, 2013, and unsealed today, Rick E. Brown, 56, and two other individuals allegedly participated in a Medicare fraud scheme operating out of a home visiting physician practice, Medicall Physicians Group Ltd., in Schaumburg, Ill., that billed for services that Medicall never provided. Medicare allegedly paid the company approximately $4.7 million for fraudulently reported services from January 2007 to December 2011.
Brown and an alleged co-conspirator, Roger A. Lucero, 62, of Elmhurst, Ill., are charged with conspiracy to commit health care fraud and health care fraud. The two men and another defendant, Mary C. Talaga, 53, of Elmwood Park, Ill., are also charged with making false statements relating to health care matters.
According to the indictment, Lucero and Brown owned and operated Medicall, and Talaga submitted the company’s bills to Medicare. The indictment alleges that Brown instructed employees to bill Medicare for patient oversight and other services that were never provided, and Lucero created backdated records in an effort to conceal the fraudulent billings. Talaga is alleged to have billed Medicare for these services even though she knew they had not been documented, a practice that required her to fabricate the information submitted to Medicare.
The charges of health care fraud conspiracy and health care fraud each carry a maximum potential penalty of 10 years in prison and a $250,000 fine. The charges of false statements relating to health care matters carry a maximum potential penalty of five years in prison and a $250,000 fine.An indictment is merely a charge and defendants are presumed innocent unless and until proven guilty.
The investigation is being conducted jointly by the FBI and HHS-OIG and brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Northern District of Illinois. The case is being prosecuted by Trial Attorney Brooke Harper of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 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 Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Goodwin Announces Another Record Total in Prescription Drug Take-back EventRead the Press Release
U.S. Attorney’s Office and DEA announce nearly 2.5 tons collected, surpassing previous record amount from April
CHARLESTON, W.Va. – U.S. Attorney Booth Goodwin and U.S. Drug Enforcement Administration (DEA) Resident Agent in Charge Suzan Williamson jointly announced today that as a result of the October 26th Prescription Drug Take-Back event, a total of 4,976 pounds of unwanted, unused and expired prescription drugs were collected from citizens and households across West Virginia. The October 26th collection results surpassed the previous Take-Back record of 4,642 pounds of prescription drugs collected in April 2013.
U.S. Attorney Goodwin said, “Having back-to-back record totals in the same year is remarkable. West Virginians have yet again responded overwhelmingly in our ongoing fight against prescription drug abuse. We’ve worked hard over the past several years to make our Take-Back initiative a success. My thanks to the DEA, state and local police, and all the West Virginians who made this result possible.”
Suzan Williamson, DEA resident agent in charge for West Virginia, said, “When people take unwanted and expired prescriptions out of their homes and dispose of them properly, it immeasurably helps our fight against prescription drug abuse. I commend all of the federal, state and local partners in West Virginia for their assistance, which has made this seventh Take-Back a success.”
The October Take-Back designated more than 130 sites throughout West Virginia, providing citizens with numerous locations to drop off expired, unused and unwanted medications. Nationwide, more than 5,100 sites participated.
In the six previous Take-Back events, the Drug Enforcement Administration, working jointly with other federal, state, and local law enforcement partners have collected more than 2 million pounds (1,409 tons) of prescription medications nationwide.
Georgia Man Pleads Guilty in Federal Court to Receiving Child PornographyRead the Press Release
Jacksonville, Florida – Acting United States Attorney A. Lee Bentley, III announced today that John Charles Stevenson (45, Rincon, Georgia) pleaded guilty to receiving videos and images depicting child pornography. Stevenson faces a mandatory minimum penalty of not less than 5 years and up to 20 years in federal prison and a potential life term of supervised release. Stevenson has been in custody since his arrest. A sentencing hearing has not yet been set.
According to court documents, a special agent with the Federal Bureau of Investigation conducted an investigation to identify individuals in Jacksonville who were trading images and videos depicting child pornography over the Internet. The agent determined that a computer using a particular IP address, in Jacksonville, was hosting child pornography. The agent was able to download several videos of prepubescent children engaged in sexually explicit conduct from this host computer. Further investigation revealed that the subscriber information for this IP address resolved to a residence in Jacksonville, where Stevenson was living.
On January 31, 2013, FBI agents and other officers executed a federal search warrant at the Jacksonville residence and seized two laptop computers. During an interview, Stevenson stated, among other things, that he had been viewing and downloading child pornography for at least three years. He described his activities with child pornography as "interesting, curious, and novel," and stated that he downloads and watches child pornography for his “personal use.” Subsequent analysis of Stevenson's laptop computers revealed a total of at least 24 videos and 51 images depicting child pornography.
This case was investigated by the Federal Bureau of Investigation and the Jacksonville Sheriff’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
G.R.E.A.T. Graduation at P.C. Lujan Elementary SchoolRead the Press Release
United States Attorney Alicia A.G. Limtiaco, announced today that after undergoing a six-week curriculum taught by Gang Resistance Education And Training (G.R.E.A.T.) officers, over 75 fifth grade students at P.C. Lujan Elementary School will be receiving their certificates of completion on Wednesday, October 30, 2013, at 9:00 A.M., in the school's cafeteria.
Parents are invited and highly encouraged to attend and participate alongside our students, in the graduation. The G.R.E.A.T. Program's primary objective is awareness and prevention of delinquency, youth violence, and gang membership. The G.R.E.A.T. lessons, aimed at elementary and middle school students, focus on providing life skills to help students avoid delinquent behavior and violence to solve problems.
Mr. Jon Fernandez, Guam Department of Education Superintendent and Barrigada Mayor June U. Blas have also been invited to attend.
U.S. Attorney Limtiaco stated, AWe praise the hard work, motivation and significant accomplishments of our students in completing the G.R.E.A.T. Program, and the continued commitment and dedication of the G.R.E.A.T. instructors to our youth in taking the G.R.E.A.T. message to our schools in Guam.
Anyone interested in learning more about the program can log on to www.great-online.org.
Freeport Physician Pleads Guilty to Health Care Fraud and Unlawful Dispensing ChargesRead the Press Release
PENSACOLA, FLORIDA – Freeport physician Robert L. Ignasiak, Jr., 58, pled guilty today to 12 counts of health care fraud, 29 counts of illegally distributing controlled substances, and one count of failing to appear for trial. The plea was announced by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
Between 2001 and 2005, while operating the Freeport Medical Clinic, Ignasiak developed a reputation as a physician who freely prescribed highly addictive controlled substances. During that time, he prescribed drugs such as hydrocodone, oxycodone, morphine, diazepam, and alprazolam in quantities, dosages, and combinations that caused his patients to abuse, misuse, and become addicted to the drugs. He continued to prescribe these substances even after becoming aware that his patients were abusing them. He did so despite indications that his patients were not taking the medicines as prescribed, were stealing drugs, were “doctor shopping,” were taking the medicines with alcohol, and were suffering overdoses.
Ignasiak was initially indicted on these charges in 2008. Following a jury trial, he was convicted of 12 counts of health care fraud and 31 counts of illegally distributing controlled substances. Ignasiak’s convictions were reversed on appeal in 2012. He was released from custody, and a retrial was scheduled. On October 31, 2012, Ignasiak faked his own suicide and became a fugitive from justice. Almost a year later, in September 2013, he was arrested in Coral Springs, Florida, while handing out leaflets for a pressure washing company, under a false name.
Ignasiak will be sentenced on January 14, 2014, by Senior United States District Judge Lacey Collier. He faces maximum prison sentences of 10 years for health care fraud, 20 years for drug distribution, and 10 years for failure to appear.
The case resulted from a four-year investigation by the North Florida Health Care Fraud Task Force, comprised of the Florida Attorney General’s Office, Drug Enforcement Administration, Federal Bureau of Investigation, National Drug Intelligence Center Document Exploitation Division, Defense Criminal Investigative Service, Florida Department of Law Enforcement, Walton County Sheriff’s Office, Florida Department of Financial Services, and State Surgeon General, Florida Department of Health.
Assistant U.S. Attorneys Karen Rhew-Miller and Alicia Kim prosecuted this case.
Former Treasurer of Mayetta Fire District Charged with Embezzling $427,000Read the Press Release
TOPEKA, KAN. - The former treasurer of the Mayetta Rural Fire District #1 in Jackson County, Kan., has been charged in federal court with embezzling more than $427,000 from the district, U.S. Attorney Barry Grissom said today.
Richard P. Bontrager, 67, Holton, Kan., was charged in a criminal information filed today in U.S. District Court in Topeka with one count of embezzlement. The criminal information alleges the crime occurred from 2008 to 2013 while Bontrager was managing the finances of the fire district, which serves a 121-square-mile area including the town and nearby rural community. Beginning in 2008, Bontrager began embezzling funds by issuing checks with forged signatures of members of the district’s five-member board of directors. He made the checks payable to a fictitious company he called “R & S Services,” to conceal the fact the money was deposited into his personal account.
The criminal information also alleges he falsified loan documents to obligate the fire district to make monthly lease payments on a Polaris Ranger UTV and a 1988 Chevrolet one-ton brush truck. He created false minutes to make it appear the board had approved the lease.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. The Jackson County Sheriff’s Office investigated. Assistant U.S. Attorney Richard Hathaway is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.Former NFL Player Sentenced to More Than 3 Years in Federal Prison for Federal Tax Fraud ConspiracyRead the Press Release
Orlando, Florida –Senior U.S. District Judge John Antoon, II today sentenced Freddie L. Mitchell, II to 37 months in federal prison for conspiracy to file a false tax claim with the government. Mitchell pleaded guilty to the offense on March 8, 2013.
According to court documents, on November 30, 2009, the Internal Revenue Service determined that a fraudulent 2008 Form 1040 claiming a $1,968,288 tax refund had been filed in the name of a professional athlete (“A.G”). Agents soon learned that A.G. had been introduced, by Mitchell, to former IRS employee Jamie Russ-Walls. A.G. had been told by Mitchell that Russ-Walls could help A.G. get extra money back from the IRS. Mitchell also falsely assured A.G. that Russ-Walls already had helped him receive a $1 million refund.
At the end of July 2009, Jamie Russ-Walls and Richard Walls flew to Orlando and met with A.G. and Mitchell. Jamie Russ-Walls indicated that she and her husband worked in the tax preparation business. After providing copies of his tax records to the couple, A.G. was told that he could get additional money back from the IRS because of "grey areas" in his tax returns. A.G. eventually made a $100,000 down payment to Mitchell towards the tax preparation fee, which Mitchell deposited it into his bank account. Mitchell eventually split the fee with Jamie Russ-Walls and Richard Walls.
Without A.G.'s knowledge, Mitchell, Jamie Russ-Walls and Richard Walls then electronically submitted a fraudulent 2008 Form 1040, in A.G.'s name, to the IRS. The form included false business losses totaling $5,367,775, resulting in a fraudulent refund of $1,968,288. A.G. never had any involvement in these businesses and never had provided the information on the tax schedule to Mitchell, Jamie Russ-Walls, or Richard Walls. The false return also included paperwork asking the IRS to directly deposit the refund into the bank accounts of Mitchell and Jamie Russ-Walls. A.G. subsequently learned of the fraudulent activity when the IRS rejected his regular tax return that was filed on October 14, 2009. The IRS was then able to cancel payment on the fraudulent return.
During the investigation, agents also discovered five other false 2009 returns totaling $2,264,005 that had been submitted by Mitchell, Jamie Russ-Walls and Richard Walls. Each of these claims had been accompanied by false W-2 forms showing wages in the millions of dollars from Chameleon Enterprises, LLC. Mitchell had incorporated this business in 2003, listed himself as the manager, and opened a mailbox in Kathleen, Florida to receive correspondence. When contacted by the IRS about the wages allegedly paid to these five individuals, Mitchell falsely verified their employment and income. Records checks later revealed that Chameleon actually had been dissolved as a corporation by the State of Florida in 2007 and therefore did not pay any wages in 2009.Jamie Russ-Walls and Richard Walls previously pleaded guilty and were sentenced for their roles in this case. On February 1, 2013, Jamie Russ-Walls was sentenced to five years of probation. On February 14, 2013, Richard Walls was sentenced to 37 months in federal prison.
This case was investigated by the Internal Revenue Service – Criminal Investigation. It is being prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
Former Jacksonville State University Professor Sentenced for Attempting to Receive Child PornographyRead the Press Release
BIRMINGHAM – A federal judge today sentenced a former assistant professor at Jacksonville State University to five years in prison for attempting to receive child pornography, announced U.S. Attorney Joyce White Vance, Immigration and Customs Enforcement's Homeland Security Investigations Special Agent in Charge Raymond R. Parmer Jr. and Alabama Bureau of Investigation's Internet Crimes Against Children Task Force Commander Jeremy Lett.
U.S. District Judge L. Scott Coogler sentenced JONATHAN MARK HERBERT, 39, of Jacksonville, and ordered him to serve 10 years of supervised probation following his five years in prison. Herbert also must register as a sex offender. Herbert pleaded guilty in January to one count of attempting to receive child pornography. U.S. Marshals took him into custody following today's hearing.
According to court documents, Herbert attempted to receive images of child pornography over the Internet in August 2012 from a 14-year-old girl, who turned out to be an undercover police officer. He also drove to a Birmingham shopping center where he planned to meet the 14-year-old for sex.
The Alabama Department of Public Safety's Internet Crimes Against Children Task Force and HSI investigated the case, which Assistant U.S. Attorneys Joe Montminy and Daniel Fortune prosecuted.Former Executive Director of Chelsea Housing Authority Charged with Conspiring to Defraud the United StatesRead the Press Release
BOSTON – The former Executive Director and Assistant Executive Director of the Chelsea Housing Authority (CHA) as well as an inspection consultant were charged today for their roles in rigging the inspection process for federally-funded housing units at the CHA.
Michael E. McLaughlin, 67, of Dracut; James H. Fitzpatrick, 63 of Acton; and Bernard J. Morosco, 50, of Utica, NY were indicted for conspiring to defraud the United States and the U.S. Department of Housing and Urban Development (HUD) by impairing, impeding, and defeating the proper operation of the physical condition assessment by HUD’s Real Estate Assessment Center (REAC), which relies on a statistically valid random sample of units to inspect.
According to the Indictment, pursuant to federal regulations to determine whether a
public housing authority is meeting the standard for its residents of conditions that are “decent, safe, sanitary, and in good repair,” REAC is required to “provide for an independent physical inspection of a public housing authority’s property or properties that includes, at a minimum, a statistically valid sample of the units in the PHA’s public housing portfolio to determine the extent of compliance with the standard.” REAC inspections are conducted by independent contractors who have received training from REAC on the inspection protocol and regulations and have been certified. Once certified, an inspector is given an inspector number and password to access the secure REAC server which contains data on all public housing authorities and also later enables the inspector to generate a random sample of units at the scheduled date of the inspection.
The indictment alleges that from 2006 through November 2011, McLaughlin and Fitzpatrick conspired with Morosco, whom they hired as a consultant for the REAC inspection process in those years. Morosco, himself a certified REAC inspector who had access to the secure REAC database, identified in advance the units of the CHA that would be randomly selected to be inspected by the assigned HUD REAC inspector on the day of the inspection. Morosco then provided to McLaughlin and Fitzpatrick a list of those units to be inspected sufficiently in advance of the inspection so that they could organize and direct REAC “SWAT” Teams of CHA employees to concentrate on ensuring that any needed repairs would be made to those identified units. When the REAC inspectors conducted the inspections in 2007, 2009 and 2011, the units that were randomly selected were the same as the ones provided in advance by Morosco.“Today’s indictment alleges a serious breach of public trust that affected residents of public housing, people who depend on the integrity of federally funded housing authorities to have a decent place to live,” said United States Attorney Carmen M. Ortiz. “This office remains committed to ensuring that taxpayer dollars spent on federally-funded housing units are used appropriately and that those who are entrusted with those funds are held accountable for actions that abuse that trust.”
“The charges made today prove our continuing resolve to root out corruption in all forms, especially the kind that ultimately hurts our most financially needy and deserving families who reside in public housing,” said Special Agent in Charge of U.S. Department of Housing and Urban Development, Office of Inspector General Christina Scaringi.
If convicted, McLaughlin, Fitzpatrick and Morosco each face a statutory maximum of five years in prison, three years of supervised release, and $250,000 fine.
USA Ortiz and SAC Scaringi announced the indictment today.
The case is being prosecuted by Assistant U.S. Attorney S. Theodore Merritt of the Public Corruption and Special Prosecutions Unit.
The details contained in the Indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former Carbon County Man Pleads Guilty to Receiving and Distributing Child PornographyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 32-year-old former Lehighton resident pleaded guilty today to receiving and distributing child pornography before Senior U.S. District Court Judge Edwin M. Kosik.
According to United States Attorney Peter J. Smith, the defendant, Stephen Puza, III, admitted to using a computer to download and share numerous images of child pornography during July 2011 through September 2013. Puza was living in Bethlehem, Pennsylvania, at the time of his arrest.
Puza was indicted by a federal grand jury on September 10, 2013, as a result of an investigation by the Federal Bureau of Investigation, the Pennsylvania State Police, and Lehighton Borough Police.
Puza faces a mandatory minimum sentence of five years in prison and a possible maximum sentence of 20 years in prison, and a fine of $250,000. Puza remains in custody pending his sentencing.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
Former CFO of Emporia Company Charged with Embezzling $265,927Read the Press Release
TOPEKA, KAN. - The former chief financial officer for a manufacturing firm in Emporia has been charged in federal court with embezzling more than $265,000 from the company, U.S. Attorney Barry Grissom said today.
Sandra Moore, 57, Emporia, Kan., was charged in a criminal information filed today in U.S. District Court in Topeka with one count of embezzlement. The criminal information alleges the crime occurred beginning in 2008 while the defendant was CFO of Sauder Custom Fabrication, Inc., in Emporia, Kan. It is alleged Moore devised a variety of schemes to divert money from her employer’s accounts to her own including:- Making unauthorized transfers from the company’s disbursement account to her personal account at ESB Financial in Emporia.
- Issuing unauthorized checks and depositing them into her personal account.
- Issuing unauthorized to repay loans she obtained from her 401K account.
Using those methods, she is alleged to have embezzled a total of $265,927 from the company.
If convicted, she faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. The FBI investigated. Assistant U.S. Attorney Richard Hathaway is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.Former Bolivar Clinic Physician Sentenced for Illegally Dispensing NarcoticsRead the Press Release
SPRINGFIELD, Mo. - Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a former physician at a Bolivar, Mo., health clinic has been sentenced in federal court for illegally distributing prescription drugs.
Nolan Denny Crisp, 76, of Halfway, Mo., was sentenced by U.S. District Judge Brian C. Wimes on Monday, Oct. 28, 2013, to two years in federal prison without parole. The court also ordered Crisp to pay a $10,000 fine.
Crisp pleaded guilty on April 8, 2013. Under the terms of his plea agreement, Crisp was required to surrender his license to practice medicine; he can never again seek licensing to practice medicine in the United States.
“A doctor handing out prescriptions in the parking lot is no better than a drug dealer on the street corner,” Dickinson said. “As a professional who certainly knew the health risks and the threat to public safety, he betrayed his oath and the trust of the community in order to profit from the dangerous abuse of prescription drugs.”
Special Agent in Charge of the FBI Michael Kaste stated, “There is no tolerance for the reckless dispensing of controlled substances. Dr. Crisp’s actions were a betrayal of his oath and the public’s trust resulting in significant harm. Law enforcement remains committed to investigating medical professionals who abuse their positions of trust, escalating the growing and serious problem of non-medical use of prescription pain relievers.”
Crisp was employed at Pomme de Terre Wellness Center (also known as the Bolivar Family Wellness Clinic and Northwoods Psychiatric Services, Inc.) in Bolivar from June 2009 through Nov. 10, 2010 to provide pain management and other services to patients.
Crisp admitted that he wrote prescriptions for OxyContin, Oxycodone Hydrochloride, and Oxycodone-Aspirin for a purported patient with whom he was involved in a sexual relationship. The prescriptions were illegal because they were not in the usual course of professional practice and for a person who had no legitimate medical need for the prescriptions.
Current and former clinic employees expressed concerns about Crisp’s prescription-writing practices. For example, clinic staff noticed Crisp meeting people in the parking lot and giving them prescriptions, even though they were not being seen in the clinic. The clinic was getting so many patients claiming that their prescriptions were lost or stolen that they began requiring a police report. A nurse practitioner said word got out that Crisp was generous with narcotics prescriptions, and she would see patients parked across the street in a church parking lot waiting for him so they could get prescriptions. She also said that sometimes the clinic nurses would run a drug screen that revealed the patient was not taking the drugs being prescribed; they informed Crisp, but he continued writing prescriptions for the patient.
The federal investigation included reviewing overdose reports from Citizens Memorial Hospital, Crisp’s appointment schedule for the clinic, Crisp’s Medicaid billing records while he was at the clinic, information regarding prescriptions written by Crisp and filled at six major pharmacies in Bolivar, and information from the Polk County Coroner. During the period that Crisp worked at the clinic, there were 96 overdose incidents at the hospital, 29 of whom were connected to his care. During that same period, six of the patients who died from overdoses were connected to his care.
The government retained an internal medicine physician specializing in pain management to review patient files. The physician was provided with charts for certain patients who were known to be drug abusers or who had overdosed. In the physician’s report, he provided background regarding the standard of care for the use of controlled substances in the treatment of pain. He also provided a detailed analysis of Crisp’s treatment of 20 patients. For the 20 patients, his opinion was that Crisp’s treatment was reckless, dangerous, life-threatening, and inconsistent with sound medical practice.
This case was prosecuted by Assistant U.S. Attorney Cindi Woolery. It was investigated by the FBI, the Drug Enforcement Administration, the Bolivar, Mo., Police Department and the Missouri Medicaid Fraud Control Unit.
Former Arlington, Texas, Police Officer Admits Unlawfully Accessing and Unlawfully Providing Law Enforcement Sensitive Information to A Known Drug DealerRead the Press Release
DALLAS — Thomas S. Kantzos, 45, of Fort Worth, Texas, a former officer with the Arlington Police Department (APD), appeared this morning before U.S. Magistrate Judge Renée Harris Toliver and pleaded guilty to an Indictment charging exceeding access to a protected computer, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
As an officer with the APD, Kantzos was authorized to access law enforcement information obtained through the Texas Crime Information Center (TCIC), the National Crime Information Center (NCIC) and the Texas Law Enforcement Telecommunication System (TLETS), and he received specialized training on the authorized uses of the information, as well as the potential penalties for the misuse of such information. Personal use of such information, including releasing information to members of the general public, is not authorized and violates APD policy.
Prior to December 2011, Kantzos knew that “Person A” was an individual who trafficked in anabolic steroids. In fact, Kantzos had received anabolic steroids from Person A for both his own use and for the use of other APD officers. In November or December 2011, Person A suspected that he was under police surveillance.
On December 29, 2011, Person A saw a motor vehicle parked near his house and asked Kantzos to “run” the license plate because he was concerned that law enforcement was watching him and he didn’t want to get arrested for trafficking the anabolic steroids. Kantzos, without a legitimate law enforcement purpose, used the computer in his patrol car, while he was on duty, to access the Texas Department of Public Safety’s (DPS) protected computer through TLETS, under the guise of conducting a stolen vehicle investigative inquiry. His computer inquiry automatically searched for information about that motor vehicle contained in law enforcement computers located in Texas and in other states, such as the NCIC computer.
Kantzos admits he knew the use of this computer for this purpose exceeded authorized use. After Kantzos obtained the information about the vehicle, he relayed the information to Person A to help Person A avoid arrest, apprehension or disruption while Person A unlawfully trafficked in the anabolic steroids.
Kantzos, who remains on bond, faces a maximum statutory penalty of five years in federal prison and a $250,000 fine. Sentencing is set for February 12, 2014, before U.S. District Judge Barbara M. G. Lynn.
The case is being investigated by the FBI and the Texas Ranger Division of the Texas DPS. Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay and Assistant U.S. Attorney Mark Penley are prosecuting.
Fairfax Man Pleads Guilty to Producing Child PornographyRead the Press Release
ALEXANDRIA, Va. – Adam Jacob Zottoli, 32, of Fairfax, Va., pleaded guilty today to two counts of production of child pornography.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, and Colonel Edwin C. Roessler, Jr., Fairfax County Chief of Police, made the announcement after the plea was accepted by United States District Judge Leonie M. Brinkema.
According to a statement of facts filed with the plea agreement, on March 19, 2013, a thirteen-year-old boy came to the attention of the Fairfax County Police Department based on concerns at school. The minor told law enforcement that over the past three years he had been sexually assaulted by Zottoli, and that Zottoli had photographed some of the incidents. Law enforcement then obtained search warrants for Zottoli’s house and computers, and the forensic review of Zottoli’s computers found images and videos of the minor, as well as videos and images of another minor. After Zottoli was arrested by the Fairfax County Police Department on April 4, 2013, he admitted to producing child pornography.
Zottoli previously was convicted of possession of child pornography on May 1, 2000 in the Eastern District of Virginia and was sentenced to serve 30 months’ imprisonment. As a result of that prior conviction, Zottoli now will face an increased mandatory minimum sentence of 25 years in prison, and up to a maximum penalty of 50 years in prison, when he is sentenced on January 17, 2014.
This case was investigated by the Fairfax County Police Department. Special Assistant United States Attorney Alicia J. Yass, a Trial Attorney with the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division, is prosecuting the case on behalf of the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by 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 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.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Duquesne Man Charged with Possessing HeroinRead the Press Release
PITTSBURGH – An Allegheny County resident has been indicted by a federal grand jury in Pittsburgh, Pennsylvania, on a charge of possession with the intent to distribute heroin, United States Attorney David J. Hickton announced today.
The one-count indictment named Anthony Coles, 26, as the sole defendant.
According to the indictment, on or about June 13, 2013, Coles was found to be in possession, with the intent to distribute, of a quantity of a mixture and substance containing a detectable amount of heroin, which is a Schedule I controlled substance.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The Greater Pittsburgh Safe Streets Task Force consisting of Pittsburgh Bureau of Police, Allegheny County Sheriff's Office, Wilkinsburg Police Department, Allegheny County Police Dept., Oakdale Police Dept, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the Federal Bureau of Investigation, and the Pennsylvania Attorney General’s Office conducted the investigation leading to the superseding indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Drug Dealer Who Stold Police Car SentencedRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announces that Terrance Robinson, 29, of Fitzgerald, Georgia, was sentenced on Monday, October 28, 2013, to 360 months imprisonment for possession with intent to distribute crack cocaine. Sentence was imposed by the Honorable Hugh Lawson, Senior United States District Judge sitting in Valdosta, Georgia.Mr. Robinson entered a plea of guilty on July 29, 2013, to one count of possession with intent to distribute crack cocaine. Mr. Johnson was stopped by officers with the Tift County Sheriff’s Office on May 23, 2012 on Ferry Lake Road near Ocilla, Georgia for a traffic violation. In entering his plea of guilty, Mr. Robinson admitted that after the police stopped his car, he struggled with officers and ultimately fled in a stolen police car with other officers in pursuit. During the subsequent chase, the stolen police car driven by Mr. Robinson was involved in a head-on collision with another police car, and Mr. Robinson was ultimately caught after trying to escape on foot. Upon searching Mr. Robinson’s car, officers located 21 plastic baggies containing 404.2 grams of crack cocaine.
“This significant sentence properly punishes Mr. Robinson for his illegal drug dealing and endangerment of law enforcement and the public,” said United States Attorney Michael Moore. “It should serve as a reminder to anyone who participates in illegal drug activity that you can run from the law, but you will be caught.”
The case was investigated by the Drug Enforcement Administration, the Mid-South Narcotics Task Force and the Tift County Sheriff’s Office. Assistant United States Attorney Peter Leary is handling the prosecution 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.