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Tuesday 22 October 2013
Owners and Operators of Crime Riddled Motels Plead Guilty; Forfeit Properties, Car and more than $265,000Read the Press Release
The final two owners and managers of crime infested motels in Tukwila, Washington pleaded guilty today to conspiracy to maintain drug involved premises, announced U.S. Attorney Jenny A. Durkan. In their plea agreements, JASPAL SINGH, 37, and KULWINDER SAROYA, 42, both of SeaTac, Washington, admit they knowingly operated drug involved premises at the Travelers Choice Motel and Great Bear Motor Inn and profited from the drug activity there. The men agree to forfeit the two motels, their home in SeaTac, more than $265,000 seized from their home and bank accounts and a 2007 Mercedes Benz. Today’s pleas mean that all three motels shuttered and seized by federal agents in August 2013 will be sold by the U.S. Marshals Service.
“We will use all of our tools to seize criminal proceeds, protect the public and hold people accountable. Since we shut these motels, the number of police calls to the immediate area has dropped by one-third,” said U.S. Attorney Jenny A. Durkan. “These defendants profited by knowingly operating motels that were a blight on the community, creating an unsafe environment and soaking up police resources to the detriment of the community. It is fully appropriate that this prosecution take the profit out of these criminal activities.”
Last week, a third defendant, LAKHVIR PAWAR, 41, the manager of the Boulevard Motel on Tukwila International Boulevard pleaded guilty and agreed to forfeit any interest in that motel as well as more than $90,000 he accumulated from the criminal activity. All three men will be sentenced by U.S. District Judge John C. Coughenour on February 28, 2014. The government has agreed to recommend no more than a year in prison for each defendant, but the judge is free to impose any sentence up to the maximum 20 years allowed by law.
According to records filed to seize the motels, the Tukwila Police Department and Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) jointly-led investigation used undercover officers and people working with law enforcement to document criminal activity at the motels and the role the owners and managers played in that activity. SAROYA and SINGH admitted they would collect or would direct their staff to collect a $10 entry fee for those coming on the property seeking drugs or sexual services. The owners and/or managers would take the money and direct the customer to rooms to purchase drugs or sex. In some instances the person taking the “fee” would call the motel room to inform the dealer or sex worker that a customer was on the way. SAROYA and SINGH admitted today that they collected additional rental fees from the dealer or sex worker based on how many customers were sent to the room over the course of the day.
The investigation, search and seizure operation was led by the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) and the Tukwila Police Department. Many additional agencies assisted the investigation including the U.S. Marshals Service; Department of Homeland Security; Drug Enforcement Administration; Federal Bureau of Investigation; Internal Revenue Service Criminal Investigation; U.S. Department of Agriculture Office of Inspector General; Washington State Patrol; Seattle, Auburn, Kent, Renton, Federal Way, and Port of Seattle Police Departments; Valley SWAT Team; King County Sheriff’s Office; Washington State Department of Corrections; and Washington State Department of Social and Health Services (DSHS).
The case is being handled by Assistant United States Attorneys Justin Arnold, Jill Otake and Richard Cohen.
Operator of Human Stash House Sentenced to 97 MonthsRead the Press Release
PHOENIX – On Oct. 21, 2013, Diego DeLeon Chavez, 26, of Mexico, was sentenced by U.S. District Judge G. Murray Snow to 97 months of incarceration and five years of supervised release. Chavez pleaded guilty on July 25, 2013, to conspiracy to harbor and transport illegal aliens, resulting in death, after two Guatemalan nationals whom Chavez’s operation was transporting were killed in a rollover crash.
During the month of July 2012, Chavez operated a human stash house in Phoenix where he harbored illegal aliens. Chavez coordinated the receipt of smuggling fees and the transportation of illegal aliens to other parts of the United States. The two victims died at the scene of the rollover crash from injuries they sustained when they were ejected from the vehicle. Thirteen illegal aliens inside the vehicle survived the crash, including the driver, Israel Velasquez, and his co-driver, who has not been identified. Velasquez, fled from the scene of the crash, but was apprehended by law enforcement four days later outside another human stash house in Phoenix. On July 25, 2013, Velasquez also pleaded guilty to conspiracy to harbor and transport illegal aliens, resulting in death, and is pending sentencing.
The investigation in this case was conducted by U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations and the Arizona Department of Public Safety’s Illegal Immigration Prevention Apprehension Co-op Team and Highway Patrol. The prosecution was handled by Kristen Brook and Lisa E. Jennis, Assistant U.S. Attorneys, District of Arizona, Phoenix.CASE NUMBER: CR-12-1503-GMS
RELEASE NUMBER: 2013-080_ChavezFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Newport News Man Sentenced for Participating in Drug ConspiracyRead the Press Release
NEWPORT NEWS, Va. – Kenneth Matthews, 36, of Newport News was sentenced today to 264 months in prison for his participation in a drug conspiracy and for being an accessory after the fact to murder.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office, and Joseph A. Moore, Interim Chief of Police, Newport News Police Department made the announcement after sentencing by United States District Judge Rebecca Beach Smith.
Matthews pled guilty on July 15, 2013 to a conspiracy to distribute more than 5 kilograms of cocaine and accessory after the fact to murder in reference to his disposal of a firearm used in the murder of Christian Hatch.
According to court documents, Matthews associated with members of a criminal organization known as “Thug Relations,” operating in the Aqueduct Apartments, St. Michael’s Apartments, Warwick Lawns, Warwick Town Homes, Heritage Trace Apartments, Mariner’s Landing Apartments, Sharon Drive and the Savage Drive areas of Newport News. The defendant and others conspired to distribute cocaine and cocaine base in order to make money from their narcotics distribution. Matthews was the secondary source of supply for many of the Thug Relations gang members. On November 4, 2009, the defendant provided a firearm to a known associate of Thug Relations who was involved in a gang related feud with several other individuals associated with a rival gang known as the "Black P-Stones", which dispute included the location of drug trafficking activities. The associate took the firearm and shot into an occupied dwelling resulting in the death of Christian Hatch and injuries to other rival gang members. Following the murder, the firearm was returned to Matthews who took the firearm out of the Commonwealth of Virginia in an effort to hinder the apprehension of the shooter. Matthews knew the firearm had been used in the murder.
This case was investigated by the Federal Bureau of Investigation, with the assistance of the Newport News Police Department and the Virginia State Police. Assistant United States Attorney Eric M. Hurt prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Monroe County Man Sentenced to Prison ForRead the Press Release
Federal Cocaine Trafficking Charges
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Monroe County man was sentenced today by Senior United States District Judge Edwin M. Kosik to serve 24 months in prison on the charge of conspiracy to distribute cocaine.
According to United States Attorney Peter J. Smith, Lenix Gutierrez-Esquea, age 31, formerly of Stroudsburg, Monroe County, previously admitted to participating in a drug-trafficking conspiracy which obtained cocaine in Texas and distributed the cocaine in the Monroe County and Northampton County areas in 2011.
Gutierrez-Esquea also faces deportation proceedings.
In addition to the prison term, Senior Judge Kosik also ordered that Gutierrez-Esquea be supervised by a probation officer for three years following his prison sentence if he is not deported.
Previously, Dickson Gutierrez, age 37, and Jhonathan Gutierrez-Esquea, age 33, both formerly of Stroudsburg, were sentenced to 60 months in prison for participating in the same cocaine-trafficking conspiracy. As part of his plea agreement, Dickson Gutierrez also agreed to forfeit to the United States two properties in the Dominican Republic which were purchased with the proceeds of cocaine trafficking activity.
The investigation was conducted by the Drug Enforcement Administration, the Stroud Area Regional Police Department and the Internal Revenue Service, Criminal Investigations.
The case was prosecuted by Assistant United States Attorney Robert J. O’Hara.
Mexican Citizen Residing in Adams County IndictedRead the Press Release
For Document Fraud
The United States Attorney’s Office for the Middle District of Pennsylvania and the U.S. Department of Homeland Security, Immigrations and Customs Enforcement, announced that a citizen of Mexico has been charged with Fraud and Misuse of Documents.
According to United States Attorney Peter J. Smith, Hermelando Murrieta-Jimenez, age 26, a native and citizen of Mexico, in the United States illegally, was charged on October 9 in a one-count indictment by a federal grand jury in Harrisburg.
The indictment alleges that on September 11, 2013, Murrieta-Jimenez did knowingly possess, use, or attempt to use a fraudulent permanent resident card and social security card in Adams County, Pennsylvania.
This investigation was conducted by the U.S. Department of Homeland Security, Immigration and Customs Enforcement and Homeland Security Investigations. It is being prosecuted by Special Assistant United States Attorney Brian G. McDonnell.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is 10 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Mary Agnes Leider Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on October 22, 2013, before U.S. District Judge Donald W. Molloy, MARY AGNES LEIDER, a 25-year-old resident of Crow Agency and an enrolled member of the Crow Tribe of Indians, was sentenced to a term of:
- ison: 262 months
- ecial Assessment: $100
- stitution: $11,113.25
- pervised Release: 5 years
LEIDER was sentenced in connection with her guilty plea to second degree murder.
In an Offer of Proof filed by Assistant U.S. Attorneys Jessica T. Fehr and Lori Harper Suek, the government stated it would have proved at trial the following:
On December 3, 2012, at approximately 4:06 a.m., 911 operators from the Big Horn County Sheriff's Office began receiving phone calls that they identified as coming from the area of mile marker 11 on Highway 313, south of Hardin. Operators dispatched law enforcement and an ambulance in response.
When they arrived at the scene, law enforcement found LEIDER and her brother, A.L., sitting off to the side of the road, crying uncontrollably. LEIDER told law enforcement that her baby was "gone", and had been hit by a vehicle. As additional law enforcement officers arrived, there was another 911 call that dispatched additional law enforcement to mile marker 19, Highway 313, to respond to another 911 emergency call regarding a deceased 3-year-old child. Upon arrival at the scene, law enforcement were met by G.D. and her son, W.L. G.D. is the mother of LEIDER, A.L., and W.L. G.D. took an officer to her car, where the officer found a 3-year-old female. The child was examined and appeared to already be deceased. The child was identified as LEIDER's daughter.
Later on that day, law enforcement interviewed G.D. She advised that her daughter, LEIDER, and her two sons had been out partying during the evening of December 2, 2012, and had taken the victim with them. G.D. reported that she had repeatedly called and text-messaged her children in order to have LEIDER come home with the victim, but LEIDER refused. Early in the morning hours of December 3, 2012, G.D. reported that she left to find LEIDER and the victim, and was traveling towards Hardin. As she was traveling north on Highway 313, she saw LEIDER's pickup traveling towards her. Both vehicles stopped, and G.D. saw that LEIDER's pickup was being driven by W.L. W.L. told Ms. Denny that something was wrong with the victim - LEIDER's three-year-old daughter. G.D. saw the victim in the back seat, and realized she was not breathing and not responsive. W.L. told G.D. that LEIDER had thrown the victim from the pickup. When G.D. picked the victim up, she saw blood coming from the back of her head. She called an ambulance and put the victim in her car.
W.L. was interviewed by law enforcement and reported that he was driving LEIDER's pickup early in the morning on December 3, 2012. W.L. reported that LEIDER was seated in the front passenger's seat, with the victim on her lap. At the time, the victim was quiet, but awake. While they were driving south towards St. Xavier, LEIDER opened the front passenger door with her right hand, and threw the victim out of the moving pickup. W.L. and the reconstructionist from the Montana Highway Patrol estimated the truck was traveling between 45 and 51 miles per hour at the time the victim was thrown from the truck. W.L. stopped as fast as he could, and threw LEIDER out of the truck with A.L. W.L. went back down the road behind the truck to where the victim was lying in the roadway. W.L. reported that he knew she was dead, but carried her back to the truck and placed her in the back seat. He began driving towards home, leaving LEIDER and his brother A.L. by mile marker 11 where they were ultimately found by law enforcement a short time later.
Following the arrival of law enforcement at the scene, LEIDER was taken to Hardin Memorial Hospital to have her blood drawn, and for treatment for abrasions to her face. Her blood alcohol level was found to be over a .24 when analyzed by the FBI Laboratory. While there, she alternated between saying, "I killed my baby" and claiming that the group had a car accident and that was how the victim had died. When questioned by law enforcement, LEIDER admitted that she had been driving around and drinking with her brothers, but claimed that she hit her face on the dashboard and could not recall how the victim was killed. LEIDER's pickup was impounded and towed to a law enforcement facility for analysis. The right front passenger door was analyzed by a professional mechanic and it was found that the door functioned properly.
An autopsy was conducted of the victim. Following the autopsy, the victim's probable cause of death was determined to be severe head injuries caused when thrown from a moving motor vehicle.
The crime occurred within the exterior boundaries of the Crow Indian Reservation.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that LEIDER will likely serve all of the time imposed by the court. In the federal system, LEIDER does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was a cooperative effort between the Bureau of Indian Affairs and the Federal Bureau of Investigation.
Man Who Posed as Wellsville Doctor Sentenced for Health Care FraudRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Fitzgerald Anthony Hudson, 53, formerly of Western New York, who was convicted of health care fraud for lying about his qualifications to practice medicine, was sentenced to 24 months in prison and three years supervised release by Chief U.S. District Chief Judge William M. Skretny. The defendant was also ordered to pay restitution in the amount of $227,548.35.
Assistant U.S. Attorney Aaron J. Mango, who handled the case, stated that in August 2008, the defendant submitted an application and was later accepted to work as a doctor in the Emergency Department at Jones Memorial Hospital in Wellsville, N.Y. In his August application, the defendant stated that (1) he had earned a degree from York University in Ontario, Canada, (2) he had never voluntarily withdrawn or resigned any employment or privileges at any healthcare facility in order to avoid the imposition of disciplinary measures, and (3) he had never been denied or suspended from any healthcare facility. In fact, the defendant did not have a degree from York, had been suspended from his duties as a resident and dismissed from the residency program due to academic incompetence at the Warren Hospital Family Practice Residency Program in Phillipsburg, New Jersey, and had resigned from the Claxton-Hepburn Medical Center in Ogdensburg, New York after being told he would be terminated for poor performance.
During the course of this prosecution, the government presented evidence that while employed at Jones Memorial Hospital, Hudson treated a five year old child who subsequently died shortly after being treated by the defendant. That case is now the subject of an ongoing wrongful death civil suit in state court. The government further introduced a New York State Board of Professional Medical Conduct investigation which concluded that the defendant obtained his medical license by fraud and while practicing medicine, and engaged in gross negligence and gross incompetence with at least five patients.“Each and every day, people across this country place their lives and their health – as well as the lives and health of their families - into the hands of those they believe to be trained medical professionals,” said U.S. Attorney Hochul. “Such medical visits are always accompanied by the highest level of trust and hope that the person we are seeing is actually qualified to provide the care for which we are seeking treatment. It is difficult to imagine a more egregious case of health care fraud than this – where a person lies in order to become an Emergency Room physician, had been twice previously cited for incompetence and poor performance, and in fact was not a legitimate doctor at all. This Office will continue to crack down on all types of health care fraud and will vigorously prosecute those who lie about their qualifications to practice medicine.”
As for the defendant’s offense of conviction, the government established that once the defendant illegally obtained his medical staff appointment, Delphi Healthcare, Hudson’s employer, billed and received approximately $227,548.35 from Medicare, BlueCross BlueShield of Western New York, Univera Healthcare, and Independent Health for services rendered by the defendant.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Brian P. Boetig, Special Agent in Charge, Special Agents of the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations under the direction of Thomas O'Donnell, Special Agent in Charge, and Investigators with the Medicaid Fraud Control Unit of the New York State Attorney General’s Office.Man Sentenced to 15 Years in Prison for Transporting 16-Year-Old Girl from California to Reno for ProstitutionRead the Press Release
RENO, Nev. – A man who transported a 16-year-old girl from Sacramento, Calif., to Reno, Nev. in July 2010 for the purposes of prostitution, has been sentenced to 15 years in prison and lifetime supervised release, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Adam Scott, 27, of Fort McDermitt, Nev., was sentenced on Monday, Oct. 21, 2013, by U.S. District Judge Larry R. Hicks. Scott pleaded guilty on July 25, 2013, to one count of sex trafficking of a minor.
“Using undue influence and force to coerce a minor to engage in sex is despicable,” said U.S. Attorney Bogden. “Our law enforcement partners will continue to aggressively search out these sexual predators and our office will continue to aggressively prosecute these child exploitation cases to protect our community and our children.”
According to the court records, on July 31, 2010, Scott transported a 16-year-old girl from Sacramento to Reno for the purpose of using her for prostitution. Scott knew that the girl was not 18 years old. Scott refused to return the girl to Sacramento and maintained her in Reno until about Aug. 11, 2010. Scott used undue influence and force, including physical assault, in order to cause the girl to engage in commercial sex acts.
The investigation was conducted by the Innocence Lost Task Force made up of the FBI and the Reno Police Department’s Street Enforcement Team. The case was prosecuted by Assistant United States Attorney Carla Higginbotham.
The case has been brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Major Drug Trafficker Receives 14 Year SentenceRead the Press Release
ATLANTA - Otis Henry has been sentenced to 14 years in prison for trafficking over 700,000 pills of BZP, a drug similar to ecstasy.
“Based on the staggering amount of drugs in the case, the defendant earned every day of his prison sentence,” said United States Attorney Sally Quillian Yates. “To those tempted by the allures of the drug trade like cars, cash, and jewelry – think twice. It’s more likely that you’ll be wearing an orange jumpsuit than a gold watch.”
Harry S. Sommers, the Special Agent in Charge of the DEA Atlanta Field Division commented, “The use of a number of synthetic designer drugs continues to be a major concern in this country. Benzylpiperine, like any other synthetic stimulant, is dangerous and can lead to adverse effects such as severe convulsions or even death. Because of the hard work and dedication of all of the law enforcement agencies involved, Henry will not be able to see the outside of prison for a long time.”
According to United States Attorney Yates, the charges and other information presented in court: From at least February 2010 to October 2010, Henry was a major distributor of BZP and marijuana in the metropolitan Atlanta area. In one instance, on October 1, 2010, law enforcement officers obtained a warrant to search Henry’s residence in DeKalb County. Inside the home, officers seized approximately 700,000 tablets of BZP which was one of the largest domestic seizures of the drug in U.S. history. In particular, officers found the pills hidden in the walls of the house, behind insulation, under seat cushions, and in crawl spaces. Officers also recovered a handgun, 2 pounds of marijuana, $39,000 in cash, and over 150 grams of methamphetamine from the residence. The street value of the drugs is estimated at $2.8 million.
After agents executed the search warrant, Henry fled and evaded authorities for over a year. Ultimately, in January 2012, Henry was arrested in Tampa, Fla. Thereafter, agents searched Henry’s hotel room and recovered 4 pounds of marijuana and $3,300 in cash.
Henry, 43, of DeKalb County, Ga., was sentenced to 14 years in prison to be followed by three years of supervised release. Henry pleaded guilty on July 24, 2013.
This case was investigated by the Drug Enforcement Administration and the DeKalb County Police Department.
Assistant United States Attorneys Jeffrey W. Davis, Dahil Goss, Jeffrey Viscomi, and Skye Davis prosecuted the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com.
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/.
Mail-order Diabetic Supply Company and Its Owners Resolve Allegations of Civil and Criminal Fraud Arising from Kickback PaymentsRead the Press Release
The owners of Kansas-based Global Medical Direct, LLC and Global Medical Inc., Robert Shea and Mark Franz, have agreed to pay $7 million to resolve allegations against them in connection with a scheme to submit false claims to the federal Medicare and Tricare healthcare programs, announced United States Attorney Kenneth Allen Polite, Jr. from the Eastern District of Louisiana along with United States Attorney Barry Grissom, from the District of Kansas. The companies have also agreed to pay to the United States $5 million in proceeds from the sale of all of the companies’ assets to settle civil allegations under the False Claims Act. Shea and Franz will also receive twenty-year exclusions from participation in any federal healthcare program as part of the settlement.
Global Medical, Inc. and its parent company, Global Medical Direct, LLC, are mail-order diabetic supply companies. The United States contends that, between April 1, 2008 and January 31, 2012, owners Robert Shea and Mark Franz caused Global Medical and Global Medical Direct to enter into numerous marketing contracts with insurance brokerage and other companies with customer bases likely to have a high percentage of diabetes patients and paid these companies based on the number of patients referred for diabetic supplies. The Anti-Kickback Statute makes it unlawful to pay or receive remuneration for patient referrals because of the high-potential for billing abuse to Federal programs, such as Medicare, resulting from these types of arrangements.
The settlement resolves the companies’ and its owners’ civil and criminal liability for their participation in the wrongdoing.
The investigation and prosecution of the companies and their owners was conducted jointly by the U. S. Attorney’s Offices for the District of Kansas and the Eastern District of Louisiana, the Office of the Inspector General for the Department of Health and Human Services, and the Federal Bureau of Investigation.
“This joint effort sends a strong message to those that would abuse federally-funded healthcare programs – we will employ all available avenues to punish those that take advantage of the system,” said Kenneth Polite, U. S. Attorney for the Eastern District of Louisiana.
“We are happy to partner with our sister districts to insure that fraud, waste and abuse are discovered and punished wherever found,” said Barry Grissom, U. S. Attorney for the District of Kansas.
"Patients have a right to expect that medical suppliers have justly earned the opportunity to win government business," said Mike Fields, Special Agent in Charge, Office of Inspector General, U.S. Department of Health and Human Services, of the region including Louisiana. "Besides the dollar settlement, two of Global's owners are now banned from government health programs for at least the next two decades."
Mail-Order Diabetic Supply Company and Its Owners Resolve Allegatiions of Civil and Criminal FraudRead the Press Release
The following is a joint release from the U.S. Attorney’s Office for the Eastern District of Louisiana and the U.S. Attorney’s Office for the District of Kansas.
NEW ORLEANS, LOUISIANA – The owners of Kansas-based Global Medical Direct, LLC and Global Medical Inc., Robert Shea and Mark Franz, have agreed to pay $7 million to resolve allegations against them in connection with a scheme to submit false claims to the federal Medicare and Tricare healthcare programs, announced United States Attorney Kenneth Allen Polite, Jr. from the Eastern District of Louisiana along with United States Attorney Barry Grissom, from the District of Kansas. The companies have also agreed to pay to the United States $5 million in proceeds from the sale of all of the companies’ assets to settle civil allegations under the False Claims Act. Shea and Franz will also receive twenty-year exclusions from participation in any federal healthcare program as part of the settlement.
Global Medical, Inc. and its parent company, Global Medical Direct, LLC, are mail-order diabetic supply companies. The United States contends that, between April 1, 2008 and January 31, 2012, owners Robert Shea and Mark Franz caused Global Medical and Global Medical Direct to enter into numerous marketing contracts with insurance brokerage and other companies with customer bases likely to have a high percentage of diabetes patients and paid these companies based on the number of patients referred for diabetic supplies. The Anti-Kickback Statute makes it unlawful to pay or receive remuneration for patient referrals because of the high-potential for billing abuse to Federal programs, such as Medicare, resulting from these types of arrangements.
The settlement resolves the companies’ and its owners’ civil and criminal liability for their participation in the wrongdoing.
The investigation and prosecution of the companies and their owners was conducted jointly by the U. S. Attorney’s Offices for the District of Kansas and the Eastern District of Louisiana, the Office of the Inspector General for the Department of Health and Human Services, and the Federal Bureau of Investigation.
“This joint effort sends a strong message to those that would abuse federally-funded healthcare programs – we will employ all available avenues to punish those that take advantage of the system,” said Kenneth Polite, U. S. Attorney for the Eastern District of Louisiana.
“We are happy to partner with our sister districts to insure that fraud, waste and abuse are discovered and punished wherever found,” said Barry Grissom, U. S. Attorney for the District of Kansas.
"Patients have a right to expect that medical suppliers have justly earned the opportunity to win government business," said Mike Fields, Special Agent in Charge, Office of Inspector General, U.S. Department of Health and Human Services, of the region including Louisiana. "Besides the dollar settlement, two of Global's owners are now banned from government health programs for at least the next two decades."Madison Man Receives 45 Month Sentence for CounterfeitingRead the Press Release
Calvin Strange, age 48, of Madison, Tennessee, was sentenced yesterday by U.S. District Judge Aleta A.Trauger, to serve 45 months in prison, followed by 3 years of supervised release, for using a counterfeiting device to produce counterfeit U.S. currency, announced David Rivera, Acting U.S. Attorney for the Middle District of Tennessee.
On July 15, 2013, Strange pleaded guilty to possession of counterfeit currency. Evidence offered at the plea hearing established that in August 2011 Strange possessed 26 uncut pages of paper with four counterfeit $5 bills on each page, as well as 144 additional counterfeit $5 bills. In addition, Strange admitted that he knew that these bills were counterfeit and that he possessed a counterfeiting device or materials used for counterfeiting.
“Counterfeit currency causes great harm to a range of unknowing victims, from small, local businesses to large financial institutions,” said Acting U.S. Attorney David Rivera. “This sentence should send a message that federal law enforcement will continue to aggressively investigate and prosecute counterfeiting offenses.”
This case was investigated by agents of the United States Secret Service, with assistance from the Metropolitan Nashville Police Department. The case was prosecuted by Assistant United States Attorney William F. Abely.Las Vegas Street Gang Member Sentenced to Life in Prison_for Racketeering, Murder, Firearm, and Drug ChargesRead the Press Release
A member of the Playboy Bloods street gang was sentenced today to life in prison for the retaliation murder of a man in November 2004 and the armed robbery of a Henderson, Nev., casino in 2002, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.
Jacorey Taylor, aka “Mo-B,” 30, who was convicted by a jury in May 2013, was sentenced by U.S. District Judge Robert C. Jones. Taylor was convicted of engaging in a racketeering (RICO) conspiracy, committing violent crimes in aid of racketeering activity, using a firearm during a crime of violence, participating in a drug conspiracy, and possessing crack cocaine with the intent to distribute. He is the ninth gang member to be convicted out of 10 charged in a RICO indictment filed in 2008. The remaining defendant, Markette Tillman, 31, is awaiting trial.
Taylor and co-defendants Reginald Dunlap, aka “Bowlie,” and Steven Booth, aka “Stevie-P,” were convicted of participating in the murder of Billy Ray Thomas, who was shot multiple times in the back on the morning of Nov. 1, 2004, as he worked on a car in the parking lot of the Pecos Terrace Apartments while waiting to take his girlfriend to work. The defendants murdered Thomas due to their mistaken belief that Thomas was a member of a rival street gang. According to evidence presented at trial, two car loads of Playboy Bloods members and associates, including Taylor, Dunlap, Booth and others, drove through known Crip neighborhoods searching for rivals to retaliate against for the murder of Quaza Burns, a leader of the Playboy Bloods. The victim, Billy Ray Thomas, had no gang affiliation.
Evidence produced at trial also showed that on March 21, 2002, Taylor, armed with an AR-15 style assault rifle, and another man armed with an handgun entered the Klondike Casino in Henderson, forced their way behind the casino cage, and robbed the casino of over $7,000 in currency.
Dunlap and Booth pleaded guilty to racketeering conspiracy charges during Taylor’s trial and were each sentenced in April 2013 to 20 years in prison. There is no parole in the federal criminal justice system.
According to court documents and evidence produced at trial, the Bloods are a nationally known criminal street gang whose members engage in drug trafficking and acts of violence. The Playboy Bloods is a local “set” or affiliate of the Bloods, with local control and operation within the Las Vegas metropolitan area. Other Bloods sets within the Las Vegas metropolitan area include the Piru Bloods and the West Coast Bloods. A subset of the Playboy Bloods is the Full Throttle Clique, a group made up of Playboy Bloods members who engage in acts of violence, including murder. According to evidence presented at trial, Taylor, Dunlap, and Booth were all members of the “Full Throttle Clique” of the Playboy Bloods. Taylor, along with other Playboy Bloods enterprise members, operated drug houses in the Sherman Gardens Annex (also known as “The Jets”) and the surrounding areas.
Eight other defendants who have been convicted and sentenced, as follows:
• Steven Booth, aka “Stevie-P,” 27, pleaded guilty to RICO conspiracy and was sentenced to 20 years in prison on April 10, 2013
• Reginald Dunlap, aka “Bowlie,” 30, pleaded guilty to RICO conspiracy and was sentenced to 20 years in prison on April 9, 2013
• Demichael Burks, aka “Mikey P,” 29, pleaded guilty to RICO conspiracy and was sentenced to 6½ years in prison on Dec. 3, 2010
• Anthony Mabry, aka “Akim Slim,” 43, pleaded guilty to RICO conspiracy and was sentenced to 14 years in prison on Oct. 20, 2010
• Delvin Ward, aka “D-Luv,” 37, pleaded guilty to RICO conspiracy and was sentenced to 11 years in prison on Sept. 17, 2010
• Terrence Thomas, aka “Seven,” 40, pleaded guilty to drug conspiracy and was sentenced to 10 years in prison on June 16, 2010
• Sebastian Wigg, aka “Rock,” 36, pleaded guilty to drug conspiracy and was sentenced to five years in prison on March 29, 2010
• Fred Nix, aka “June P,” 36, pleaded guilty to drug conspiracy and was sentenced to five years in prison on March 29, 2010
The cases were investigated by the FBI’s Las Vegas Safe Streets Gang Task Force, which includes officers from the North Las Vegas Police Department and Las Vegas Metropolitan Police Department, and are being prosecuted by Assistant United States Attorneys Nicholas D. Dickinson, and Phillip N. Smith, Jr., and Kevin L. Rosenberg, Trial Attorney with the U.S. Department of Justice Organized Crime and Gang Section.
Kansas City Man Pleads GuiltyIn Bank Robbery with HatchetRead the Press Release
KANSAS CITY, KAN. - A Kansas City, Mo., man has pleaded guilty in a case in which an Overland Park bank was robbed by a man with a hatchet, U.S. Attorney Barry Grissom said today.
Derek T. Brownlee, 35, Kansas City, Mo., pleaded guilty to one count of armed robbery. A criminal complaint filed in July alleged Brownlee was wearing a bandanna over his face and carrying a hatchet on July 1, 2013, when he robbed the Metcalf Bank at 7800 College Boulevard in Overland Park.
The complaint alleged Brownlee jumped the teller’s counter and demanded money. He took cash from a drawer and some personal items from a teller including a Kindle Fire and a cellular telephone. When police officers spotted his car, he led them on a chase at speeds up to 90 miles an hour before being stopped in the 8700 block of Indiana in Kansas City, Mo. He was arrested after he fled from the car on foot.
Sentencing is set for Jan. 21. He faces a maximum penalty of 20 years and a fine up to $250,000. Grissom commended the FBI, the Overland Park Police Department, the Kansas City, Mo., Police Department and Assistant U.S. Attorney Kim Martin for their work on the case.
Kansas City Man Pleads Guilty to Robbery, Carjacking, Firearms ChargeRead the Press Release
KANSAS CITY, KAN. - A Kansas City, Kan., man has pleaded guilty to federal charges arising from an armed robbery and a carjacking, U.S. Attorney Barry Grissom said today.
Derrick L. Freeman, 28, Kansas City, Kan., pleaded guilty to one count of armed robbery, one count of carjacking, and one count of unlawful possession of a firearm after a felony conviction.
In his plea, Freeman admitted that on May 12, 2013, he and his co-defendants went to the home of a Kansas City, Kan., man to buy some synthetic marijuana. Once there, they robbed the man at gunpoint. During the robbery, Freeman fired a handgun and then fled the scene before police arrived.
On May 26, 2013, Freeman and co-defendants walked to a Stop Shop gas station at 6865 State Avenue in Kansas City, Kan., where Freeman suggested they “get a car.” They robbed the driver of a 2004 Ford Freestar minivan of wallet and keys and drove away in the minivan. When the defendants realized officers had spotted their vehicle they led police on a 17-minute chase at speeds up to 112 miles per hour. The minivan wrecked in a plowed field near Leavenworth Road and North 184th Street in Basehor, Kan., where the defendants fled on foot. Derrick Freeman fired a handgun at a law enforcement officer before being arrested.
Freeman will be sentenced at a later date. Both parties have agreed to recommend a sentence of 300 months in federal prison.
Co-defendants include:
Joe Freeman, 33, Kansas City, Kan., who is awaiting trial.
Jeffrey B. Jackson, 47, Leavenworth, Kan., who is awaiting trial.
Terry D. Tillman, 26, Kansas City, Kan., who is set for sentencing Nov. 12.
Anthony L. Irvin, 19, Kansas City, Kan., who is set for sentencing Nov. 25.
Melvin L. Shields, 20, Kansas City, Kan., who is set for sentencing Nov. 25.Grissom commended the Kansas City, Kan., Police Department, the Wyandotte County Sheriff’s Department, the Kansas Highway Patrol, the Basehor Police Department, the Edwardsville Police Department, the Bonner Springs Police Department, the Leavenworth County Sheriff’s Department and Special Assistant U.S. Attorneys Erin Tomasic and Trent Krug for their work on the case.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
KC Business Owner Pays $78,000 to City of Nixa as Restitution for Fraud SchemeRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Kansas City, Mo., business owner has paid $78,810 in restitution to the city of Nixa, Mo., as part of a pretrial diversion agreement.
Gary N. Cohn of Kansas City was the subject of a federal investigation for his role in a mail fraud conspiracy. Cohn operates GNC, a Kansas City business that distributes a variety of products to municipalities and other customers. Cohn was identified during a federal criminal investigation that resulted in the indictment and conviction of former Nixa city employees Larry Covington and David Griggs. Covington and Griggs were involved in a scheme to defraud the city of Nixa of more than $756,000 from October 2004 to February 2009.
Covington and Griggs each pleaded guilty to conspiracy to commit mail fraud, conspiracy to commit money laundering, theft from an organization receiving federal funds; Covington also pleaded guilty to one count of mail fraud. Covington was sentenced on Nov. 9, 2010, to nine years in federal prison without parole. Griggs was sentenced on July 26, 2010, to two years and eight months in federal prison without parole.
Cohn maintained a business relationship with the city of Nixa through Covington, who was the city’s street superintendent. Cohn billed the city of Nixa, by mail, for goods that were delivered to Covington for his personal use and for products that were not delivered or were not what was represented.
Under the terms of his pretrial diversion agreement, which was signed on Sept. 30, 2013, the prosecution of the offense was deferred for 18 months while Cohn is placed under supervision and required to pay $78,810 in restitution. Cohn paid that restitution on Monday, Oct. 21, 2013.
Cohn also agreed that he would not conduct any business with any municipality, school district, or other public entity in the southern and southwestern portion of the Western District of Missouri during the 18-month period of supervision.
According to a statement of agreed facts that was signed by Cohn, Covington routinely ordered products from Cohn and GNC at the same time he made fraudulent purchases amounting to approximately $750,000 through dummy companies. Nixa public works department employees reported that specific products ordered from Cohn and GNC were never delivered and could not be located in inventory at any city facility. In fact, the Nixa public works department did not have adequate space to store the quantity of products billed by GNC.
According to Nixa public works department employees, GNC sometimes supplied products that were significantly more expensive than similar products. Numerous products purchased from GNC demonstrated grossly exaggerated prices, one of which was more than 1,339% higher than the suggested retail value of the product.
Cohn admitted that he paid $3,100 to establish an account for Covington at the Show-Me Birds Hunting Resort located in Baxter Springs, Kan. Covington used this account to pay for hunting trips. In a statement to the owner of the hunting resort, Cohn said that he was making the payments in order to "take care of” Covington so that he would continue to buy products from him.
If Cohn violates the conditions of the pretrial diversion agreement, he could be prosecuted for the alleged criminal conduct. If Cohn completes the diversion program and fulfills all the terms and conditions of the agreement, no prosecution will be instituted and the matter will be closed.
The criminal case involving Covington and Griggs was prosecuted by Supervisory Assistant U.S. Attorney Michael S. Oliver. It was investigated by the Nixa, Mo., Police Department, the FBI and IRS-Criminal Investigation.
Indictment Charges Four with Running Illegal Gambling OperationRead the Press Release
PHILADELPHIA – An indictment was unsealed today in Philadelphia charging Anthony Gifoli, 65, Frank Tulino, 66, Vincent Simoni, 64, and James Matteis, 58, all of Philadelphia, with conducting an illegal gambling business, announced U.S. Attorney Zane David Memeger, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, and FBI Special Agent-in-Charge Edward J. Hanko.
According to the indictment, Gifoli, Tulino, Simoni, and Matteis operated a sports bookmaking operation in Philadelphia from January 27, 2009 through November 1, 2010. All of the defendants were arrested yesterday.
If convicted, each defendant faces a maximum penalty of five years in prison and a $250,000 fine.
The case is being investigated by the FBI and the New Jersey State Police. It is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section.
Click here to view the indictment
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Indiana County Man Sentenced to 27 Months in Prison for Fraud SchemeRead the Press Release
PITTSBURGH – A resident of Indiana County, Pa., has been sentenced to 27 months in prison and three years supervised release for his conviction of conspiracy, United States Attorney David J. Hickton announced today.
United States District Judge Terrence F. McVerry imposed the sentence on Daniel Pikel,57.
According to the information presented to the court, between 2009 and 2012, Pikel conspired with another person to launder through his business banking account approximately $2.9 million in funds embezzled by a former company officer from Falcon Drilling, LLC, a drilling contractor located in Indiana, Pa.
Assistant United States Attorney Gregory C. Melucci prosecuted this case on behalf of the government.
The United States Postal Inspection Service, the U.S. Internal Revenue Service - Criminal Investigation and the Pennsylvania State Police in Indiana, Pennsylvania, conducted the investigation that led to the prosecution of Daniel Pikel.
Illinois Man Charged with Fraudulent Scheme Involving Impersonation of Canadian Government OfficialsRead the Press Release
BROOKLYN, NY – Howard Leventhal, 56, was arrested this morning for defrauding a Florida company of $800,000 and attempting to defraud an undercover law enforcement agent in Brooklyn of more than $2.5 million, by falsely claiming that his company, Neovision USA, Inc. (“Neovision”), had a lucrative contract with Canada’s Department of Health (“Health Canada”). The defendant’s initial appearance for removal proceedings to the Eastern District of New York is scheduled this afternoon before United States Magistrate Judge Michael T. Mason, at the Everett McKinley Dirksen United States Courthouse in Chicago, Illinois.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
According to the complaint unsealed this morning in Brooklyn federal court, in May 2012, Leventhal entered into a factoring agreement with Paragon Financial Group, Inc. (“Paragon”), a Florida company, whereby Paragon would advance Neovision $800,000 in exchange for Paragon’s right to collect a larger sum of money purportedly owed to Neovision by Health Canada. Health Canada’s indebtedness to Neovision was purportedly based on an agreement between Neovision and Health Canada, whereby Neovision would provide Health Canada with “Heltheo’s McCoy Home Health Tablet,” a device ostensibly named after the fictional Dr. Leonard McCoy of TV’s Star Trek series.1 To conceal his scheme, Leventhal assumed the identities of Health Canada representatives, including that of former Deputy Health Minister Glenda Yeates. Further, Leventhal created and used domain names, telephone numbers, and email addresses that closely resembled those actually used by Health Canada. For example, Leventhal created and used healthcanada.com.co and hc-sg-gc.ca in place of Health Canada’s true domain name hc-sc.gc.ca.
Contrary to Leventhal’s representations to Paragon, (1) there was no agreement between Health Canada and Neovision, (2) Health Canada did not owe Neovision any money, and (3) Deputy Health Minister Glenda Yeates’ signature on the agreement was a forgery. Believing his misrepresentations, Paragon advanced Leventhal $800,000. To date, Paragon has neither received a payment from Health Canada nor received a refund from Leventhal.
As alleged in the complaint, Leventhal also attempted to defraud a potential investor, who in reality was an undercover law enforcement agent posing as a high net worth individual, in Brooklyn, New York, of more than $2.5 million. In recorded conversations, Leventhal falsely represented that his company had a series of contracts with Health Canada for Heltheo’s McCoy Home Health Tablet and that his company had more than $18 million in sales for 2012. Leventhal emailed the undercover agent the same fraudulent agreement he used to deceive Paragon. To further induce the undercover agent to invest in his company, Leventhal sent him six months of phony Bank of America statements for Neovision that falsely showed more than $10 million in payments from Health Canada to Neovision from March 2013 through July 2013. Neovision’s actual bank statements for the same account and time period do not show any payments from Health Canada.
“As alleged, Leventhal claimed to have lucrative connections within the Canadian government and cutting edge technology that could help save lives. In reality, his scheme was pure science fiction, complete with phony documents and a fictional medical device. As part of his alternate reality, Leventhal impersonated Canadian government officials by creating phony government contracts, telephone numbers, and email addresses. Investors thought they were advancing scientific technology; instead they were merely financing Leventhal’s fraudulent scheme. Leventhal’s scheme was foiled due to the swift and effective actions of law enforcement both here and in Canada,” stated United States Attorney Lynch. Ms. Lynch expressed her grateful appreciation to the Royal Canadian Mounted Police (RCMP) and Health Canada for their significant cooperation and assistance in the investigation.
FBI Assistant Director-in-Charge Venizelos stated, “As alleged in the complaint, Leventhal concocted a scheme to defraud potential investors of their money based upon misrepresentations, forgeries, and lies. After stealing money from Paragon, Leventhal aggressively pursued his next victim-investor who, unbeknownst to him, was an undercover law enforcement agent. The FBI will use all investigative resources at its disposal to combat cases of fraud and will continue to work with its law enforcement partners to ensure that individuals who line their pockets by defrauding investors are brought to justice.”
The charges in the complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, the defendant faces a maximum sentence of 20 years’ imprisonment.
The government’s case is being prosecuted by Assistant United States Attorney Winston M. Paes.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency 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.
The Defendant
HOWARD LEVENTHAL
Age: 56
Long Grove, Illinois_____________________________
1 Leventhal claimed that Heltheo’s McCoy Home Health Tablet can instantaneously and effectively deliver detailed patient data to physicians and other licensed medical care providers.
Huntsville Resident Convicted of Distributing Child PornographyRead the Press Release
HOUSTON – Reed Christopher LeBlanc, 20, a former resident of Huntsville, has entered a plea of guilty to distribution of child pornography, announced United States Attorney Kenneth Magidson.
The investigation started as a result of several downloads of child pornography over the Internet by a federal agent with the New York office of the FBI which were traced to a computer used by LeBlanc.
On Dec. 3, 2012, federal agents served a search warrant at LeBlanc’s Huntsville address and seized his Apple computer. A forensic exam was conducted, revealing approximately 82 images and 33 videos of child pornography.
U.S. District Judge Nancy Atlas, who accepted the guilty plea, has set sentencing for Jan. 14, 2014, at which time Leblanc faces at least five and up to 20 years imprisonment as well as a possible $250,000 fine. Upon completion of any prison term imposed, LeBlanc also faces a maximum of life on supervised release during which the court can impose a number of special conditions designed to protect children and prohibit the use of the Internet. He will remain in custody pending that hearing.
The charges against were the result of an investigation conducted by the FBI and officers with the Houston Metro Internet Crimes Against Children Task Force.
This case, prosecuted by Assistant U.S. Attorney Robert Stabe, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Hartford Woman Who Illegally Received Social Security Benefits Is SentencedRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that THERESA FORD, 55, of Hartford, was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to three years of probation for illegally receiving Social Security benefits.
According to court documents and statements made in court, FORD began receiving Social Security Administration (SSA) Disability Insurance Benefits (DIB) in May 2007. From approximately January 2007 through September 2011, FORD worked as a secretary for a small business, and her duties included managing time cards and payroll records for all of the business’s employees. During this time, FORD’s income from her work as a secretary was more than the SSA Monthly Substantial Gainful Activity (SGA) limit, which, if known by the SSA, would have terminated her eligibility for SSA DIB payments. The payroll records prepared by FORD that her employer used to draft payroll checks accurately reflected her earnings. However, the payroll summary ledgers prepared and sent by FORD to the business’s accountants under reported the amount of money that she was actually paid. FORD’s earnings were reported to SSA based on the false payroll summary ledgers. By reporting less than the SGA limit to SSA, FORD was able to remain eligible and continue to unlawfully receive SSA DIB payments.
FORD stopped working at the business in September 2011 and she continued to unlawfully receive DIB payments through December 2012.
FORD received a total of $56,780 in DIB payments that she was not eligible to receive. Today, she was ordered to pay full restitution.
On June 13, 2013, FORD waived her right to indictment and pleaded guilty to one count of theft of government property.
This matter was investigated by the Office of the Inspector General for the Social Security Administration and was prosecuted by Assistant U.S. Attorney Felice Duffy.PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Getaway Driver in the Robbery of A Dunmore Bank Pleads GuiltyRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that Vanessa Ramos, age 23, of Wilkes-Barre, Pennsylvania, pleaded guilty today to aiding and abetting the robbery of a Dunmore bank before Senior United States District Court Judge James M. Munley.
According to United States Attorney Peter J. Smith, Ramos appeared in federal court in Scranton, Pennsylvania, and admitted that she acted as a getaway driver for Romeal Price in the robbery of the Pennstar Bank, 1230 O’Neill Highway, Dunmore, Pennsylvania, of approximately $11,000 on June 28, 2013. At the time of the bank robbery, Price was a fugitive following his escape from the Catholic Social Services Residential Reentry Center on June 18, 2013. Price had been housed there while completing the remaining few months of a 15-year federal prison sentence from 2001. Following the bank robbery, Price fled to New York City. On July 17, 2013, deputies of the United States Marshals Service arrested Price in a New York City apartment without incident. On September 6, 2013, Price, age 36, appeared in Federal Court in Scranton and admitted to the escape and bank robbery charges.
The case was investigated by the United States Marshals Service, the Federal Bureau of Investigation, and the Dunmore Police Department. The case is being prosecuted by Assistant U.S. Attorney John Gurganus.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is 20 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Georgia Real Estate Investment Company and Owner Plead Guilty to Conspiracies to Rig Bids and Commit Mail Fraud for the Purchase of Real Estate at Public Foreclosure AuctionsRead the Press Release
A Georgia real estate investor and his company pleaded guilty today for their role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Georgia, the Department of Justice announced.
Separate felony charges were filed on Sept. 25, 2013, in the U.S. District Court for the Northern District of Georgia in Atlanta, against Penguin Properties LLC and its owner, Seth D. Lynn.
According to court documents, from at least as early as Feb. 6, 2007 until at least Jan. 3, 2012, Penguin Properties and Lynn conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in Fulton County, Ga. Penguin Properties and Lynn were also charged with a conspiracy to use the mail to carry out a scheme to fraudulently acquire title to selected Fulton County properties sold at public auctions, to make and receive payoffs and to divert money to co-conspirators that would have gone to mortgage holders and others by holding second, private auctions open only to members of the conspiracy. The department said that the selected properties were then awarded to the conspirators who submitted the highest bids in the second, private auctions.
Charges were also brought against Penguin Properties and Lynn for their involvement in similar conspiracies in DeKalb County, Ga., from at least as early as July 6, 2004 until at least Jan. 3, 2012.
“Today’s charges are the first to be filed in the state of Georgia in the Antitrust Division’s ongoing investigation into anticompetitive conduct in real estate foreclosure auctions,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The division’s investigation has already resulted in dozens of guilty pleas in other states, and the division remains committed to eliminating anticompetitive practices at foreclosure auctions.”
The department said that the primary purpose of the conspiracies was to suppress and restrain competition and to conceal payoffs in order to obtain selected real estate offered at Fulton and DeKalb County public foreclosure auctions at non-competitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner. According to court documents, these conspirators paid and received money that otherwise would have gone to pay off the mortgage and other holders of debt secured by the properties, and, in some cases, the defaulting homeowner.
“The core of this case was about an unlevel field and one of unfairness with regard to the auction/bidding process of foreclosed properties,” said Mark F. Giuliano, Special Agent in Charge of the FBI Atlanta Field Office. “The FBI remains committed in providing investigative resources to the U.S. Department of Justice’s Antitrust effort to address such matters.”
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals and a $100 million fine for corporations. The maximum fine for a Sherman Act charge may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime if either amount is greater than the statutory maximum fine. A count of conspiracy to commit mail fraud carries a maximum penalty of 20 years in prison and a fine of $250,000 for an individual, and a fine of $500,000 for a corporation. The respective maximum fines for the conspiracy to commit mail fraud charge may be increased to twice the gross gain the conspirators derived from the crime or twice the gross loss caused to the victims of the crime by the conspirators.
The investigation is being conducted by Antitrust Division attorneys in Atlanta and the FBI’s Atlanta Division, with the assistance of the Atlanta Field Office of the Housing and Urban Development Office of Inspector General and the U.S. Attorney’s Office for the Northern District of Georgia. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should call 404-331-7113 or visit www.justice.gov/atr/contact/newcase.htm.
Today’s charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
Georgia Man Sentenced to 235 Months for attempted Sexual Exploitation of a Minor via the InternetRead the Press Release
GAINESVILLE, FLORIDA–Douglas Ray Castleberry, 35, of St. Mary’s, Georgia, was sentenced yesterday in federal court to serve 235 months in prison for using the Internet to attempt to entice a child to engage in sexual activity.
Castleberry was arrested on November 14, 2012, as part of a law enforcement on-line operation conducted in Gainesville, Florida. By means of an Internet website, Castleberry attempted to persuade an 11-year-old child to engage in sexual activity. He then traveled from St. Mary’s to Gainesville with multiple images of child pornography, which he could use to teach the child to commit similar acts. After his arrest in Gainesville, officers examined his cell phone and identified numerous other potential child victims.
Castleberry faced a mandatory minimum sentence of 10 years imprisonment with a maximum of life imprisonment. He was sentenced by U.S. District Judge Mark E. Walker to serve 235 months in prison, followed by a term of life on supervised release. In addition, upon his release, Castleberry will be required to register as a sex offender in accordance with state and federal law.
In announcing the sentence imposed by the court, United States Attorney Pamela C. Marsh said, “The growing threat of sexual exploitation crimes committed against children through the Internet is a deplorable trend. My office is committed to the safety and well-being of every child and has placed a high priority on combating sexual exploitation of minors.” U.S. Attorney Marsh also praised the Alachua County Sheriff’s office for their dedicated work, resulting in Castleberry’s arrest and prosecution. She said, “Without their excellent work, this predator might still be lurking on the Internet, threatening to victimize additional children.”This case was investigated by the Alachua County Sheriff’s Office and was prosecuted by Assistant U.S. Attorney Frank Williams.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched by the Department of Justice in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.Gambian National Pleads Guilty to Trafficking in Counterfeit MerchandiseRead the Press Release
Gulfport, Miss. – Ousainou Mahanera, 33, a citizen of Gambia who resides in New Orleans, Louisiana, pled guilty to trafficking in counterfeit merchandise, announced U.S. Attorney Gregory K. Davis and Raymond R. Parmer, Jr., Special Agent in Charge of Homeland Security Investigations (“HSI”) in New Orleans.
Mahanera admitted that on March 8, 2013, he trafficked in counterfeit merchandise bearing counterfeit marks from the companies of Gucci, Louis Vuitton, Hermes, Burberry and Fendi. Mahanera sold the counterfeit handbags, shoes, scarves and other items at a flea market in Algiers, Louisiana.
Mahanera will be sentenced by U.S. District Judge Sul Ozerden on January 27, 2014 at 9:30 a.m. He faces a maximum sentence of 10 years in prison and a $2 million fine.
This case was investigated by Homeland Security Investigations and prosecuted by Assistant U.S. Attorney Ruth Morgan..###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
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Former Vice President at Harrisburg Area Community College Charged with Wire FraudRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced the filing of an Information in U.S. District Court in Harrisburg today charging Nancy Rockey, age 55, of Harrisburg, Pennsylvania, with wire fraud.
According to United States Attorney Peter J. Smith, Rockey, was employed by Harrisburg Area Community College (HACC) from 1980 until her resignation in February 2012. At the time of her resignation, Rockey was Vice-President of the Harrisburg campus and Vice-President of College and Community Development.
In connection with her position, HACC provided Rockey with a HACC credit card to be used to purchase work-related items such as text books, training materials and other educational items.
Rockey is charged with using the HACC credit card to make online purchases of Target gift cards which she then used to purchase non-work-related items for herself, her family and her friends. It is alleged that Rockey created bogus invoices, later submitted to the HACC Finance Office, to conceal the unauthorized purchases.
Rockey is charged with purchasing $228,000 worth of gift cards with her HACC credit card.
The investigation was conducted by the FBI and the Dauphin County Criminal Investigations Division. The case is being prosecuted by Assistant U.S. Attorney Joseph J. Terz.
The U.S. Attorney’s Office also filed a plea agreement which must be approved by the District Court.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is 20 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Former President of Wyoming Area Education AssociationRead the Press Release
Pleads Guilty To Embezzlement Of Union Funds
The United States Attorney’s Office for the Middle District of Pennsylvania announced that Lisa Barrett, age 48, of Shavertown, Luzerne County, pleaded guilty on October 2, before Senior U.S. District Court Judge James M. Munley, to a felony Information which charged her with embezzlement of funds from a labor organization.
According to United States Attorney Peter J. Smith, Barrett is the past president of the Wyoming Area Education Association (WAEA) and admitted to converting in excess of $30,000 in funds of the labor union to her own use from 2006 to 2012. Barrett resigned as president of WAEA in March 2013.
The investigation was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Robert J. O’Hara.
Senior Judge Munley ordered that a presentence investigation take place. Sentencing has been scheduled for January 8, 2014.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is imprisonment for five years, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public, and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Former Employee of Bon-Ton Stores FoundationRead the Press Release
Pleads Guilty To $1.2 Million Wire Fraud And Tax Evasion
The United States Attorney’s Office for the Middle District of Pennsylvania, announced that on October 15, Christine S. DeJuliis, age 51, of Felton, PA, pleaded guilty before U.S. Magistrate Judge Susan E. Schwab to wire fraud and tax evasion charges. Magistrate Judge Schwab has recommended that the guilty plea be accepted by U.S. District Court Judge Yvette Kane.
According to United States Attorney Peter J. Smith, DeJuliis was hired by the Bon-Ton Stores, Inc., in 1999, and worked in an administrative capacity for the Bon-Ton Stores Foundation, a charitable organization established by the Bon-Ton Stores, Inc. While working in that capacity, DeJuliis created fictitious businesses, opened bank accounts in those entities’ names, and then devised a scheme to forge Foundation checks written to those entities. For at least one of those entities, DeJuliis used an internet-based legal document service to obtain an Employer Identification Number. The Foundation money was put into the fictitious accounts controlled by DeJuliis and then moved into her personal accounts. Between January 2003 and July 2009, DeJuliis defrauded the Foundation of more than $1.2 million. During tax years 2007 and 2008, DeJuliis also failed to pay income tax on the money she stole from the Foundation, resulting in a tax loss of more than $170,000. DeJuliis was fired from the Foundation as soon as her conduct was discovered by the company in July 2009.
The guilty plea was entered pursuant to a plea agreement reached by the parties following DeJuliis’s indictment on mail fraud and money laundering charges in January 2013.
The case was investigated by the U.S. Secret Service and Internal Revenue Service–Criminal Investigation based on information received from the Bon-Ton Stores, Inc.The case is being prosecuted by Assistant United States Attorney James T. Clancy, Chief of the Victim Rights and Asset Recovery Unit.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this particular case, the maximum penalty under the federal statute is 20 years’ imprisonment on the wire fraud charge, a term of supervised release following imprisonment, and a fine. The tax evasion charge subjects DeJuliis to a term of imprisonment of up to 5 years and a fine of the greater of $100,000 or twice the tax loss. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Former Blackfeet Tribal Chairman Sentenced to Prison in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on October 21, 2013, before Chief U.S. District Judge Dana L. Christensen, PATRICK CHARLES THOMAS, a 55-year-old resident of Cut Bank, was sentenced to a term of:
* Prison: 12 months, and 1 day
* Special Assessment: $100
* Restitution: $162,865.36
* Supervised Release: 3 years
THOMAS was sentenced in connection with his guilty plea to unlawful conversion of property he had pledged as security to obtain a series of loans from the Farm Services Agency. An agricultural borrower gives the FSA an interest in their livestock and crops, as well as identified pieces of property and equipment, to insure that the loan is secure and will not be left unpaid. It is illegal to dispose of that property without involving the FSA or providing the FSA with the proceeds of any sale.
THOMAS, a lifelong resident of the Blackfeet Reservation, served on the Blackfeet Tribal Business Council, the governing body of the Blackfeet Tribe, from 2004 to 2008; first in the position of Vice Chairman and then as Chairman.
In an Offer of Proof filed by Assistant U.S. Attorney Carl E. Rostad, the government stated it would have proved at trial the following:
THOMAS was a rancher/farmer near Cut Bank who obtained, over the years, numerous loans from the U.S. Department of Agriculture, Farm Services Agency (FSA). As part of that lending and borrowing relationship, THOMAS pledged as collateral all livestock, crops, and personal property.
Beginning in or before June of 2006, THOMAS began to sell off hay, grass (grazing), cattle, equipment, and other pledged assets without notifying the FSA of the transactions or the income generated from the sale of those assets.
On December 18, 2008, THOMAS submitted a balance sheet to support his application for financing through FSA showing he had 225 bred cows which would be used as collateral. The FSA had concerns regarding the actual number of cows. They had not been able to get an actual count of the cattle for some time and, when chattel inspections had been completed, it did not appear that there were as many cattle as they thought should be there. FSA conducted a count December 29, 2008, and located 169 head. When questioned about the discrepancy and the missing 59 head of cows, THOMAS stated they had gone down into Flat Coulee on his neighbor's place and he couldn't get them up.
On March 2, 2009, THOMAS was approved for a $65,000 annual operating loan from FSA which also rescheduled THOMAS's existing FSA loans. The projections used were based, in material part, on the cow numbers shown on the Security Agreement dated December 19, 2008, which showed 225 head of cows and 11 bulls.
On March 31, 2009, FSA performed an inspection and recorded approximately 180 head of cows. Later that year, in October 2009, without notifying or receiving the approval of the FSA, THOMAS sold 105 calves to a Nebraska-based cattle buyer without disclosing to the buyer that the calves were pledged as security to the FSA. THOMAS concealed the sale from the FSA and converted the proceeds - $49,776 - to his own use and benefit.
On February 22, 2010, FSA went to THOMAS's ranch to do a chattel inspection and cattle count for both the Farm Loan Program and for THOMAS's daughter's 2009 LIP claim. FSA counted 99 cows and 3 yearlings, of which 62 were THOMAS's and 6 of which belonged to his daughter. FSA representatives could not read the brand on the remaining 33 head.
On April 22, 2010, FSA and representatives of the Montana Department of Livestock went to THOMAS's ranch to count the cattle. The final tally that day was 81 head of cows, of which 70 had THOMAS's brand, and 11 had other family member's brands. There were also 53 head of unbranded calves. The numbers were significantly less than what FSA had collateralized - or believed to have collateralized on the basis of THOMAS's representations. These events prompted FSA to turn the case over to the Department of Agriculture's Office of Inspector General for criminal investigation. The subsequent investigation established that between June 11, 2006, and July 13, 2011, THOMAS disposed of and sold at least $162,865.36 in cattle, hay, equipment and other property he had pledged as a collateral to obtain FSA loans, and in which the FSA had a security interest, without the knowledge or approval of the FSA. Agent Monique Hirko-Damuth testified at THOMAS's sentencing hearing that she obtained the defendant's bank records and examined all deposits. On numerous checks the memo section identified the property purchased from THOMAS. She then compared the property sales to the list of pledged assets to determine the amount of secured property that THOMAS had sold without the approval of the FSA and which had not gone to satisfy THOMAS's indebtedness to the agency.
U.S. Attorney Mike Cotter called Judge Christensen's sentence "a sentence that promotes respect for the law. It warns those who endeavor to cheat a federal loan program --- a program that provides producers with financial opportunity and the tools to succeed in Montana's agricultural industry --- that their conduct will not go unnoticed or ignored. The integrity of FSA's lending program will be preserved and protected. Our response will be vigorous and the consequences of deception will be serious."
Cotter included the THOMAS case in the Guardian's Project even though he describes the case as an "external" attack on federal programs when the primary focus of the effort is on "internal" attacks by public officials. "An important component of the THOMAS prosecution was the allegation contained in the first count of the indictment relating to a fraudulent claim in the Keepseagle settlement". In Keepseagle v. Vilsak, a class action lawsuit was pursued by Native American farmers and ranchers alleging that they had been discriminated against by the U.S. Department of Agriculture (USDA) and that they had been denied equal access to credit in the USDA Farm Loan Program. As a result of that lawsuit, on April 28, 2011, a $760 million settlement with the USDA was approved, and claims were entertained from individual Native American producers who asserted that they had been discriminatorily aggrieved by the USDA in the lending process. "This office determined that the Keepseagle claim was best pursued by a civil false claims action against THOMAS and we anticipate bringing that action in the near future."
Because there is no parole in the federal system, the (truth in sentencing( guidelines mandate that THOMAS will likely serve all of the time imposed by the court. In the federal system, THOMAS does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
Eric and Ryan Jensen Plead Guilty to All Counts of Introducing Tainted Cantaloupe into Interstate CommerceRead the Press Release
Click here for a copy of the Jensen plea agreement
DENVER -- Eric Jensen, age 37, and Ryan Jensen, age 33, brothers who owned and operated Jensen Farms, located in Granada, Colorado, pled guilty this morning before U.S. Magistrate Judge Michael E. Hegarty to all six counts of the government’s Information which charged them with introduction of adulterated cantaloupe into interstate commerce, United States Attorney John Walsh and Food and Drug Administration – Office of Criminal Investigation Special Agent in Charge Patrick Holland announced. The defendants are scheduled to be sentenced by Magistrate Judge Hegarty on January 28, 2014 at 9:00 a.m. Eric and Ryan Jensen were first charged by Information on September 24, 2013. They made their initial appearance in U.S. District Court in Denver on September 26, 2013.
According to the stipulated facts in the plea agreement, as well as other court documents, Eric and Ryan Jensen were responsible for a farm in Granada, Colorado, where they grew, picked, packaged, sold and shipped cantaloupe. In six separate shipments, the cantaloupe produced by the Jensens bore a poisonous bacteria, Listeria monocytogenes, which rendered it injurious to health.
The court documents further state that the defendants set up and maintained a processing center where cantaloupes were taken from the field and transferred to a conveyor system for cleaning, cooling and packaging. The equipment should have worked in such a way that the cantaloupe would be washed with sufficient anti-bacterial solutions so that the fruit was cleaned of bacteria in the process.
In May of 2011 the Jensen brothers allegedly changed their cantaloupe cleaning system. The new system, built to clean potatoes, was installed, and was to include a catch pan to which a chlorine spray could be included to clean the fruit of bacteria. The chlorine spray, however, was never used. The defendants were aware that their cantaloupes could be contaminated with harmful bacteria if not sufficiently washed. The chlorine spray, if used, would have reduced the risk of microbial contamination of the fruit.
Investigation by the FDA and the Center for Disease Control (CDC) determined that the defendants failed to adequately clean their cantaloupe. They then maintained the fruit in unsanitary conditions . Their actions allegedly resulted in at least six shipments of cantaloupe contaminated with Listeria monocytogenes being sent to 28 different states. The CDC tracked the outbreak-associated illness and determined that people living in 28 states consumed contaminated cantaloupe, resulting in at least 33 deaths and 147 hospitalizations. Further, one woman pregnant at the time of her outbreak-related illness had a miscarriage. Ten additional deaths not specifically attributed to Listeriosis occurred among persons who had been infected by eating outbreak-related cantaloupe.
“The defendants have now admitted that they failed to protect the public from deadly bacteria on their cantaloupe, in violation of the law and critical FDA requirements,” said U.S. Attorney John Walsh. “Their actions resulted in tragedy nationwide, and profound economic consequences for an entire industry, and has exposed them to these serious criminal consequences.”
“According to CDC estimates, roughly 48 million Americans get sick, 128,000 are hospitalized, and 3,000 die of foodborne diseases each year. I applaud the U.S. Attorney’s Office for the District of Colorado for standing up for the 147 known victims in this case,” said Patrick J. Holland, Special Agent in Charge of the FDA—Office of Criminal Investigations. Prosecutions like this heightened awareness among food growers, processors and distributors and demonstrate the critical role they play in the health and safety of every American.”
Both defendants have pled guilty to six counts of adulteration of a food and aiding and abetting. If convicted, each defendant faces not more than one year in federal prison, and a fine of up to $250,000 per count.
This case was investigated by the FDA -- Office of Criminal Investigations, the Center for Disease Control and the State of Colorado Department of Public Health and Environment.
The defendants are being prosecuted by Assistant U.S. Attorney Jaime Pena.
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Eight Individuals Convicted in Federal CourtRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-7725 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistFollow us on Twitter @NDWVnews
ELKINS, VIRGINIA – Eight individuals entered plea of guilty before Magistrate Judge John S. Kaull according to United States Attorney William J. Ihlenfeld, II.
LINDSEY PARKER ROY, age 40, MICHAEL WAYNE JOHNSON, age 32, EILEEN MICHAEL DESHAYES, age 28, and NICOLE ROSELLA SPOR, age 36, of Elkins, entered pleas of guilty to “Possession of Pseudoephedrine to be Used in the Manufacture of Methamphetamine.” ROY, JOHNSON and DESHAYES, who are free on bond, and SPOR, who is in custody, pending sentencing, each face up to twenty years in prison. This case was investigated by the West Virginia State Police, the U.S. Forest Service, the Elkins Police Department and the Randolph County Sheriff’s Department.
DESTRY SETH POLING, age 27, of Parsons, West Virginia, SHANNON DAVID FLAGG, age 40, of Hambleton, West Virginia, and MICHAEL LUTHER WHITE, age 22, of Thomas, West Virginia, entered pleas of guilty to “Possession of Pseudoephedrine to be Used in the Manufacture of Methamphetamine.” POLING, FLAGG and WHITE, who are free on bond pending sentencing, each face up to twenty years in prison. This case was investigated by the West Virginia State Police, the U.S. Forest Service, and the Tucker County Sheriff’s Department.
CHAD FREDERICK ARBOGAST, age 34, of Belington, West Virginia, entered a plea of guilty to “Distribution of Oxycodone.” ARBOGAST, who is free on bond pending sentencing, faces up to twenty years in prison. This case was investigated by the West Virginia State Police-Bureau of Criminal Investigations, the U.S. Forest Service and the Randolph County Sheriff’s Department.
The above cases were prosecuted by Assistant U.S. Attorney Stephen D. Warner.
Eagle Butte Man Found Guilty of Attempted Aggravated Sexual Abuse and Abusive Sexual ContactRead the Press Release
United States Attorney Brendan V. Johnson announced that Ronnie Fire Cloud, age 38, of Eagle Butte, South Dakota, was convicted of Attempted Aggravated Sexual Abuse and Abusive Sexual Contact as a result of a federal jury trial in Pierre, South Dakota. Fire Cloud was found not guilty of Aggravated Sexual Abuse by Force.
The conviction carries a maximum penalty of any term of years, up to life, of imprisonment and/or a $250,000 fine and a mandatory minimum term of supervised release of 5 years, up to life. A special assessment of $200 to the Federal Crime Victims Fund will also be ordered.
The conviction stems from an incident occurring on November 2, 2012. Fire Cloud allowed the victim, who was a house guest, to use his shower. While she was showering, Fire Cloud entered the bathroom, fondled her, and attempted to rape her. The victim was able to escape the bathroom, flee the residence and contact the authorities.
This case was investigated by the Bureau of Indian Affairs, Standing Rock Agency, the National Park Service, and the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Troy R. Morley.
A presentence investigation report was ordered, and a sentencing date was set for April 21, 2014.
Fire Cloud was remanded to the custody of the U.S. Marshals Service pending sentencing.Duval County Man Indicted and Arrested on Hoax Bomb Charge Involving Jacksonville International AirportRead the Press Release
Jacksonville, Florida – Acting United States Attorney A. Lee Bentley, III announces the return by a grand jury of an indictment charging Zeljko Causevic (39, Jacksonville) with conveying false or misleading information. Causevic was arrested on a federal warrant while in state custody and faces a maximum penalty of five years in federal prison.
According to the indictment, Causevic entered Jacksonville International Airport on October 1, 2013, and stated that he was in possession of a bomb.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the FBI Joint Terrorism Task Force, the Jacksonville Aviation Authority, the Jacksonville Sheriff’s Office, and the Transportation Security Administration. It will be prosecuted by Assistant United States Attorney Kevin C. Frein.
Duryea Man Charged with Drug Trafficking OffenseRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a criminal Information was filed on October 10, charging Gerald Timek, age 28, of Duryea, Pennsylvania, with distribution of cocaine.
According to United States Attorney Peter J. Smith the charges are the result of an investigation conducted by the Federal Bureau of Investigation; the Pennsylvania Attorney General’s Office; and the Luzerne County District Attorney’s Office. Prosecution is assigned to Assistant United States Attorney John Gurganus.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this particular case, the maximum penalty under the federal statute is twenty years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Dublin Doctor Sentenced on Drug Diversion ChargesRead the Press Release
ROANOKE, VIRGINIA -- A former medical doctor from Dublin, Va., who in February was convicted on 172 criminal counts of diverting pain medication, was sentenced today in the United States District Court for the Western District of Virginia in Roanoke.
Linda Sue Cheek, 64, of Dublin, Va., was indicted in May 2012 and charged with 86 counts of distributing scheduled controlled substances without holding a valid certificate of DEA Registration, 81 counts of using a DEA registration number issued to another person, five counts of using a DEA registration number which has been revoked or suspended and one count of maintaining a drug-involved premise.
Following an eight-day trial in February of this year in the United States District Court in Roanoke, a jury convicted the former doctor on 172 of the 173 counts leveled against her. Today in District Court, Cheek was sentenced to 33 months of federal incarceration. She was also ordered to pay a special assessment of $17,125.
“Prescription drug abuse is an epidemic that is destroying lives and ruining too many Virginia communities,” United States Attorney Timothy J. Heaphy said today. “Despite losing her license to prescribe medicine, Dr. Cheek illegally fed the addiction of hundreds of patients while collecting their money. The criminal prosecution of unethical medical professionals like Dr. Cheek is a central part of our comprehensive strategy to address the prescription drug crisis. We must also continue to reduce demand and provide effective treatment if we are to have an impact on this public health emergency.”
Evidence presented at trial by Assistant United States Attorney Jennie L.M. Waering, determined that Cheek wrote prescriptions for controlled substances on her revoked DEA number and wrote prescriptions on a DEA number that belonged to another person.
The investigation of the case was conducted by the Drug Enforcement Administration, the Department of Health and Human Services and the Virginia State Police. Assistant United States Attorney Jennie L.M. Waering and Virginia Assistant Attorney General and Special Assistant United States Attorney Vaso T. Doubles are prosecuting the case for the United States.
Drug Take-Back Day Scheduled for Saturday, October 26Read the Press Release
United States Attorney Brendan V. Johnson announced that the Drug Enforcement Administration (DEA) has scheduled a National Prescription Drug Take-Back Day for Saturday, October 26, 2013, from 10:00 a.m. to 2:00 p.m.
Spearheaded in 2010, the purpose of the nationwide initiative is to allow people to safely dispose of their expired, unused, and unwanted prescription pills at specified drop off sites. The proper disposal of these drugs can help prevent abuse and theft by eliminating the product from the household.
This service is free of charge, anonymous, and there are no questions asked. October 26 will be the seventh time in three years that the DEA and partners have offered this opportunity to the public.
During the sixth annual Take-Back Day last April, South Dakotans turned in 1,146 pounds of prescription drugs.
For the October 26 event, there are currently 22 participants hosting collection sites in South Dakota, with five of those sites available on the Cheyenne River Indian Reservation. The Cheyenne River Sioux Tribe Law Enforcement has coordinated with the U.S. Attorney’s office and the DEA to provide the following sites for medication disposal:Eagle Butte: Cultural Center
Whitehorse: Community Building
Cherry Creek: Community Clinic
Red Scaffold: Community Clinic
LaPlante: Tiospaye Topa School“I encourage anyone with expired or unused prescription drugs to take advantage of this opportunity to dispose of them safely and properly,” said U.S. Attorney Johnson. "I especially applaud the law enforcement at Cheyenne River for their efforts in securing five locations on the reservation as drop-off sites. I’m hopeful that residents of these tribal communities will join in this effort to help ensure these drugs don’t harm people or the environment.” Assistant U.S. Attorney Kathryn Rich will be on hand in Eagle Butte for the event.
Take-Back Day is a cooperative effort between the DEA; the U.S. Attorney’s Office; national, state, local, and tribal law enforcement officials; and community coalition groups who work together to support and provide this community service.
For a listing of collection sites, or for more information on the Take-Back initiative, visit the DEA website: www.DEA.gov
Douglas Vance Crooked Arm and Kenneth G. Shane Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on October 22, 2013, before U.S. District Judge Donald W. Molloy, DOUGLAS VANCE CROOKED ARM, age 36, and KENNETH G. SHANE, age 45, residents of Crow Agency, were sentenced.
CROOKED ARM was sentenced to a term of:
- obation: 4 years, with 6 months electronic monitoring
- ecial Assessment: $200
- stitution: $3,000
SHANE was sentenced to a term of:
- obation: 1 year
- ecial Assessment: $200
- stitution: $3,000
They were sentenced in connection with their guilty pleas to conspiracy to traffic in eagles and migratory birds, and unlawfully trafficking in migratory birds.
In an Offer of Proof filed by Assistant U.S. Attorney Mark S. Smith, the government stated it would have proved at trial the following:
Operation Hanging Rock" was a U.S. Fish & Wildlife Service investigation into the unlawful sale of migratory bird feathers. As part of that operation, on August 17, 2008, FWS Special Agents (SAs) went to the Crow Fair in Crow Agency. While there undercover, the agents encountered SHANE and his brother-in-law, CROOKED ARM. SHANE gave the agents his contact information and invited them to visit his house.
On November 13, 2008, the agents met with SHANE and CROOKED ARM at SHANE's father's house, south of Garryowen. An agent noticed two golden eagles flying around the area, and said to the other agent, "There's your tail, Liz." SHANE asked "Are you looking for tails?" The agent told SHANE she needed a fan for her dress. SHANE said "My brother-in-law (CROOKED ARM) has got some made, beaded and everything. He likes to hunt and everything." SHANE said "My brother-in-law got some white-tail buck and a muley buck and he is going to leave the carcasses out there." SHANE said CROOKED ARM was "bringing his carcasses out because that's what we're hunting right now," indicating they would put out the carcasses as bait to attract eagles. SHANE also said, "We put the carcass out here and we drive up and ... the black and whites haven't been so good lately, we are waiting for some more snow."
SHANE called CROOKED ARM's cell phone, asked him whether he had any fans for sale. SHANE told CROOKED ARM that the agents might be interested in purchasing them. SHANE then generally pointed out areas where he and CROOKED ARM placed deer and elk carcasses for hunting hawks and eagles. CROOKED ARM arrived at the residence and showed the agents parts of deer carcasses lying in the back of his truck. The agents asked CROOKED ARM if he needed help putting carcasses out, but CROOKED ARM said he could do it himself. One of the agents asked CROOKED ARM how he could get nice deer like those. CROOKED ARM responded, "Poach." The group noticed a golden eagle flying nearby, and SHANE told CROOKED ARM to drop a carcass in that area.
CROOKED ARM then removed one immature golden eagle fan and one magpie fan from his truck cab and showed them to the agents. CROOKED ARM then left to put out the deer carcass. SHANE told the agents he and CROOKED ARM wanted $1,500 for the golden eagle fan and $800 for the magpie fan. SHANE told one of the agents that he and CROOKED ARM had obtained the golden eagle used to make the fan the previous Christmas. The agent paid SHANE $1,500 cash and received the golden eagle fan from him. The agents also placed an order for a magpie fan. One of the agents later saw SHANE give CROOKED ARM a portion of the $1,500 they had paid for the golden eagle fan. SHANE told the agents that CROOKED ARM needed this money to make a payment on his pickup truck. SHANE said he and CROOKED ARM had a good thing going, working hard all winter to kill and trap eagles. SHANE told the agents that CROOKED ARM made regalia to sell while he stayed home taking care of his kids, and this helped the family get by during the winter.
On January 29, 2009, an agent called SHANE, and SHANE said he and CROOKED ARM were still putting out deer and elk carcasses to trap and kill eagles and hawks. The agent asked SHANE for a nice tail, and SHANE said CROOKED ARM had several so they would save one for him.
On February 11, 2009, an agent met with SHANE and they drove to CROOKED ARM's residence, in Hardin. The agent told CROOKED ARM that the other agent wanted to buy another eagle fan and a winter hawk fan. CROOKED ARM said he had plenty of tails and had sold four golden eagle fans and several hawk fans the previous week to some people from New Mexico. CROOKED ARM produced two eagle feathers from an adjoining room, and told the agent that several of his tails were similar to these feathers. CROOKED ARM agreed to a $500 deposit, and told the agent to e-mail him the specifics for the fans. CROOKED ARM gave the agent his phone numbers. The agent paid CROOKED ARM the $500 deposit.
On March 8, 2009, CROOKED ARM sent one of the agents an e-mail containing photos of a bald eagle fan and a winter hawk (rough-legged) tail he intended to use for her hawk fan. CROOKED ARM wrote that he only had two weeks to finish the agents's hawk fan before a powwow in Denver. He asked the agent if the hawk in the photo was acceptable. Later that day, in a second e-mail to the agent, CROOKED ARM wrote that the bald eagle fan from the photo took extra time because he had to send it to a friend to clean off the blood, and there was a lot of blood.
The next day, March 9, 2009, CROOKED ARM called the agent and asked what colors she wanted on her fan. On March 10, 2009, CROOKED ARM called the other agent to tell him that his $500 deposit would be payment for the "winter hawk" fan, but the bald eagle tail fan from the photo would cost $1,000 because he had to pull a few strings to get it in time for the Denver powwow.
On the morning of March 11, 2009, a FWS Special Agent served a search warrant on CROOKED ARM"s residence in Hardin. They seized, among other things, a hand-written note containing the undercover agent"s order for a winter hawk feather fan, and one bald eagle feather fan. After agents read him his rights, CROOKED ARM signed an Advice of Rights Form, and agreed to cooperate. CROOKED ARM retrieved the undercover agent's order from the top of his refrigerator and admitted he knew the two undercover agents in connection with the note.
That same morning, another FWS Special Agent, accompanied by six other special agents, served a search warrant on SHANE's father's home south of Garryowen. SHANE arrived a few minutes after the agents. The agents advised SHANE of the search warrant and SHANE agreed to speak with them briefly. A Special Agent told SHANE he would not be arrested and explained the undercover agent's true identity. SHANE admitted that he knew it was illegal to sell hawk and eagle parts.
SHANE admitted that CROOKED ARM sold a golden eagle peyote fan to the undercover agents, but claimed he never counted the money they paid him, having given the entire amount to CROOKED ARM. SHANE also told the agents he saw one of the undercover agents show CROOKED ARM a sketch and discuss purchasing a hawk fan with beadwork to match her skirt. SHANE said he had a permitted eagle from the U.S. Fish and Wildlife Service, which he had used to make a bustle for his dance costume, stored in the basement. The agents photographed this bustle, but did not seize it. SHANE said that CROOKED ARM had called him the day before to ask for one of the undercover agent's phone number to complete the sale of a bronze hawk fan and bald eagle tail fan.
The investigation was conducted by the U.S. Fish and Wildlife Service.
District Woman Found Guilty of Charges in Shooting at Northwest Washington Restaurant-Defendant Shot Victim Once in the Chest-Read the Press Release
WASHINGTON – Lashawn Carson, 28, of Washington, D.C., was found guilty on Oct. 11, 2013 of aggravated assault while armed and related firearms offenses stemming from a shooting at a Northwest Washington restaurant, U.S. Attorney Ronald C. Machen Jr. announced.
The jury’s verdict followed a trial in the Superior Court of the District of Columbia. The Honorable Michael Ryan scheduled sentencing for Dec. 9, 2013.
According to the government’s evidence, at 5:30 a.m. on March 11, 2012, two groups of friends were eating at the IHOP restaurant in the 3100 block of 14th Street NW. The victim’s group of friends was seated at one table and Carson’s group was at another.
As the victim was attempting to walk to the cash register to pay his bill, Carson and a male friend inadvertently stood directly in his way. The victim attempted to squeeze by and accidently bumped into Carson. Words were exchanged, and the defendant’s male friend used a homophobic slur. A fight ensued, and an off-duty police detective, who was seated nearby, jumped up to break it up. At that point, according to the government’s evidence, Carson walked over, adjusted her hair, pulled out a firearm and shot the victim once in the chest.
In announcing the verdict, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department. He also expressed appreciation to those who handled the case for the U.S. Attorney’s Office, including Assistant U.S. Attorneys Andrew Finkelman and Lauren Dickie, who investigated the case, and Assistant U.S. Attorney Nicholas Cannon, who investigated the case and prosecuted it at trial.
13-360District Man Pleads Guilty to Tax Fraud Related to Embezzlement of Indonesian Airline- Admits Failure to Report over $448,000 in Income -Read the Press Release
WASHINGTON - Jon C. Cooper, 64, of Washington, D.C., pled guilty on Oct. 9, 2013 in the U.S. District Court for the District of Columbia to one count of tax evasion related to his failure to report over $448,000 in income he received in 2006.
The guilty plea, which took place on Oct. 9, 2013, was announced today by U.S. Attorney Ronald C. Machen Jr., Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Thomas J. Kelly, Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI).
As part of his guilty plea, Cooper admitted that, in December 2006, he and Alan Messner induced an Indonesian airline company to pay them a $1 million security deposit to lease two aircraft using various false and fraudulent pretenses, representations, and promises – including forged and fraudulent documents. Cooper admitted that, after he received the $1 million security deposit, he transferred $284,500 to Messner in December 2006 and January 2007. Cooper spent the balance of the security deposit for his own personal benefit. Cooper and Messner did not provide the promised aircraft and did not return any funds to the Indonesian airline company.
Cooper admitted that he did not report at least $448,727 of those proceeds on his federal income tax return for 2006. Instead, by under-reporting his income, Cooper claimed a tax refund that year. As a result of Cooper’s tax evasion, Cooper caused a tax loss of at least $133,464 to the United States.
Cooper is to be sentenced on Jan. 23, 2014, before the Honorable Amy Berman Jackson. He faces a maximum sentence of five years in prison and a $250,000 fine. In addition, as part of his guilty plea, Cooper agreed to pay $133,464 owed to the United States. Cooper further agreed to make restitution of $1 million to the victimized Indonesian airline company.
In a related case, Messner, 41, of Rolling Meadows, Ill., pled guilty in August 2013 to one count of tax evasion, admitting that he failed to report any portion of the $284,500 he received on his federal income tax returns. Messner is to be sentenced on Dec. 13, 2013. Messner faces a maximum sentence of five years in prison and a $250,000 fine. As part of his guilty plea, Messner agreed to pay the full $62,231 which he owed to the United States.
In announcing the guilty plea, U.S. Attorney Machen, Assistant Director Parlave, and Special Agent in Charge Kelly expressed appreciation for the work done by those who investigated the case from the FBI’s Washington Field Office and the Washington Field Office of the IRS-CI. They also acknowledged the efforts of Trial Attorney Jessica Moran, of the Department of Justice’s Tax Division. Finally, they commended the work of those who handled the case from the U.S. Attorney’s Office, including Paralegal Specialist Krishawn Graham, and Assistant U.S. Attorneys Richard DiZinno and Jonathan Hooks, who investigated and indicted the case.
13-359Diebold Incorporated Resolves Foreign Corrupt Practices Act Investigation and Agrees to Pay $25.2 Million Criminal PenaltyRead the Press Release
Diebold Inc. (Diebold), the Ohio-based provider of integrated self-service delivery and security systems, including automated teller machines (ATMs), has agreed to pay a $25.2 million penalty to resolve allegations that it violated the Foreign Corrupt Practices Act (FCPA) by bribing government officials in China and Indonesia and falsifying records in Russia in order to obtain and retain contracts to provide ATMs to state-owned and private banks in those countries.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Steven M. Dettelbach of the Northern District of Ohio made the announcement.
The department today filed in U.S. District Court for the Northern District of Ohio a criminal information and a deferred prosecution agreement. The two-count information charges Diebold with conspiring to violate the FCPA’s anti-bribery and books and records provisions and violating the FCPA’s books and records provisions.
“In China, Indonesia and Russia, Diebold chose to pay bribes for business and falsify documents to cover its tracks,” said Acting Assistant Attorney General Raman. “Through its corrupt business practices, Diebold undermined the sense of fair play that is critical for the rule of law to prevail. Today’s action – which holds Diebold accountable for its criminal conduct, while also recognizing its cooperation and voluntary disclosure to the government of its conduct – underscores that fighting global corruption is and will remain a mainstay of the Criminal Division’s mission.”
“Companies that pay bribes to public officials, whether those officials are in Cleveland, in Ohio or overseas, violate the law,” said U.S. Attorney Dettelbach. “Corporate earnings cannot be placed above the rule of law, and today’s penalties – nearly $50 million in all – send the message again, loud and clear, that such conduct is unacceptable. We hope that Diebold will use this opportunity, including the internal controls and compliance monitor required by today’s agreement, to turn the page to a newer and more ethical corporate culture.”
According to court documents, Diebold paid bribes and falsified documents in connection with the sale of ATMs to bank customers in China, Indonesia, and Russia. With respect to China and Indonesia, the court documents allege that from 2005 to 2010, in order to secure and retain business with bank customers, including state-owned and -controlled banks, Diebold repeatedly provided things of value, including payments, gifts, and non-business travel for employees of the banks, totaling approximately $1.75 million. Diebold attempted to disguise the payments and benefits through various means, including by making payments through third parties designated by the banks and by inaccurately recording leisure trips for bank employees as “training.” The court documents also allege that from 2005 to 2009, Diebold created and entered into false contracts with a distributor in Russia for services that the distributor was not performing. The distributor, in turn, used the money that Diebold paid to it, in part, to pay bribes to employees of Diebold’s privately-owned bank customers in Russia in order to obtain and retain ATM-related contracts with those customers.
In addition to the monetary penalty, Diebold agreed to implement rigorous internal controls, cooperate fully with the department, and retain a compliance monitor for at least 18 months. The department agreed to defer prosecution for three years and, if Diebold abides by the terms of the deferred prosecution agreement, the department will dismiss the criminal information when the agreement’s term expires. The agreement acknowledges Diebold’s voluntary disclosure and extensive internal investigation and cooperation.
In a related matter, Diebold reached a settlement with the SEC and agreed to pay approximately $22.97 million in disgorgement and prejudgment interest. The SEC settlement was filed today.
The case is being prosecuted by Trial Attorney Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Justin J. Roberts of the Northern District of Ohio. The case was investigated by the FBI’s Cleveland Field Office. The department acknowledges and expresses its appreciation for the assistance provided by the SEC’s Division of Enforcement.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
Diebold Inc. to Pay $25 Million Criminal Penalty to Resolve Foreign Corrupt Practices Act InvestigationRead the Press Release
Diebold Inc., the North Canton-based provider of integrated self-service delivery and security systems, including automated teller machines (ATMs), has agreed to pay a $25.2 million penalty to resolve allegations that it violated the Foreign Corrupt Practices Act (FCPA) by bribing government officials in China and Indonesia and falsifying records in Russia in order to obtain and retain contracts to provide ATMs to state-owned and private banks in those countries.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Steven M. Dettelbach of the Northern District of Ohio made the announcement.
The department today filed in U.S. District Court for the Northern District of Ohio a criminal information and a deferred prosecution agreement. The two-count information charges Diebold with conspiring to violate the FCPA’s anti-bribery and books and records provisions and violating the FCPA’s books and records provisions.
“In China, Indonesia and Russia, Diebold chose to pay bribes for business and falsify documents to cover its tracks,” said Acting Assistant Attorney General Raman. “Through its corrupt business practices, Diebold undermined the sense of fair play that is critical for the rule of law to prevail. Today’s action – which holds Diebold accountable for its criminal conduct, while also recognizing its cooperation and voluntary disclosure to the government of its conduct – underscores that fighting global corruption is and will remain a mainstay of the Criminal Division’s mission.”
“Companies that pay bribes to public officials, whether those officials are in Cleveland, in Ohio or overseas, violate the law,” said U.S. Attorney Dettelbach. “Corporate earnings cannot be placed above the rule of law, and today’s penalties – nearly $50 million in all – send the message again, loud and clear, that such conduct is unacceptable. We hope that Diebold will use this opportunity, including the internal controls and compliance monitor required by today’s agreement, to turn the page to a newer and more ethical corporate culture.”
According to court documents, Diebold paid bribes and falsified documents in connection with the sale of ATMs to bank customers in China, Indonesia, and Russia. With respect to China and Indonesia, the court documents allege that from 2005 to 2010, in order to secure and retain business with bank customers, including state-owned and -controlled banks, Diebold repeatedly provided things of value, including payments, gifts, and non-business travel for employees of the banks, totaling approximately $1.75 million. Diebold attempted to disguise the payments and benefits through various means, including by making payments through third parties designated by the banks and by inaccurately recording leisure trips for bank employees as “training.” The court documents also allege that from 2005 to 2009, Diebold created and entered into false contracts with a distributor in Russia for services that the distributor was not performing. The distributor, in turn, used the money that Diebold paid to it, in part, to pay bribes to employees of Diebold’s privately-owned bank customers in Russia in order to obtain and retain ATM-related contracts with those customers.
In addition to the monetary penalty, Diebold agreed to implement rigorous internal controls, cooperate fully with the department, and retain a compliance monitor for at least 18 months. The department agreed to defer prosecution for three years and, if Diebold abides by the terms of the deferred prosecution agreement, the department will dismiss the criminal information when the agreement’s term expires. The agreement acknowledges Diebold’s voluntary disclosure and extensive internal investigation and cooperation.
In a related matter, Diebold reached a settlement with the SEC and agreed to pay approximately $22.97 million in disgorgement and prejudgment interest. The SEC settlement was filed today.
The case is being prosecuted by Trial Attorney Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Justin J. Roberts of the Northern District of Ohio. The case was investigated by the FBI’s Cleveland Field Office. The department acknowledges and expresses its appreciation for the assistance provided by the SEC’s Division of Enforcement.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
Defendant Pleads Guilty in Manhattan Federal Court to Participating in Racketeering Conspiracy with Russian-American Organized Crime Enterprise Operating International SportsbookRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that STAN GREENBERG pled guilty today in Manhattan federal court to participating in a racketeering conspiracy in connection with his role as a member of a Russian-American organized crime enterprise. GREENBERG was charged in April 2013 along with 33 other alleged members and associates of two Russian-American organized crime enterprises – the Taiwanchik-Trincher Organization and the Nahmad-Trincher Organization – in an indictment which included racketeering, money laundering, extortion, and various gambling offenses. He pled guilty before U.S. District Judge Jesse M. Furman.
Manhattan U.S. Attorney Preet Bharara said: “With his guilty plea today, Stan Greenberg is now the latest member of this Russian-American organized crime ring to be convicted, but we expect he will not be the last. We remain committed to pursuing and prosecuting those involved in this international enterprise.”
According to the Indictment, other documents filed in Manhattan federal court and statements made at various proceedings in this case, including today’s guilty plea:
The Taiwanchik-Trincher Organization is a nationwide criminal enterprise with strong ties to Russia and Ukraine. The leadership of the organization ran an international sportsbook that catered primarily to Russian oligarchs living in Russia and Ukraine and throughout the world. The Taiwanchik-Trincher Organization laundered tens of millions of dollars in proceeds from the gambling operation from Russia and the Ukraine through shell companies and bank accounts in Cyprus, and from Cyprus into the United States. Once the money arrived in the United States, it was either laundered through additional shell companies or invested in seemingly legitimate investments, such as hedge funds or real estate. GREENBERG was a U.S.-based participant in the enterprise. In this capacity, he assisted the Taiwanchik-Trincher Organization in laundering the proceeds of their international sportsbook into various investment vehicles, including real estate purchases and hedge funds, in the United States.
GREENBERG, 48, of New York, NY, faces a maximum of 20 years in prison and three years of supervised release. As part of his plea agreement, GREENBERG agreed to forfeit the proceeds from his racketeering activity. He is scheduled to be sentenced by Judge Furman on February 27, 2014 at 3:00 p.m.
GREENBERG is the 12th defendant in this case to plead guilty. The following defendants previously pled guilty and await sentencing:
- Bryan Zuriff pled guilty to gambling charges on July 26, 2013;
- William Barbalat pled guilty to gambling charges on August 14, 2013;
- Kirill Rapoport pled guilty to gambling charges on August 16, 2013;
- Edwin Ting and Justin Smith pled guilty to gambling charges on September 4, 2013;
- Dmitry Druzhinsky and David Aaron pled guilty to gambling charges on October 4, 2013;
- Alexander Zaverukha pled guilty to gambling charges on October 10, 2013;
- Nicholas Hirsch pled guilty to conspiring to commit wire fraud on October 16, 2013;
- Anatoly Shteyngrab pled guilty to conspiring to commit money laundering on October 17, 2013; and
- Yugeshwar Rajkumar pled guilty to gambling charges on October 18, 2013.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation, New York City Police Department, and Internal Revenue Service.
The case is being prosecuted by the Office’s Organized Crime Unit. Assistant U.S. Attorneys Harris M. Fischman, Joshua A. Naftalis, Peter Skinner, and Kristy J. Greenberg of the Organized Crime Unit are in charge of the prosecution. Assistant U.S. Attorneys Alexander Wilson and Christine Magdo of the Office’s Asset Forfeiture Unit are responsible for the forfeiture aspects of the case.
U.S. v. Alimzhan Tokhtakhounov, et al. Indictment
Couple Charged with EmployingRead the Press Release
Undocumented Workers At Wichita Chinese Restaurant
WICHITA, KAN. – The operators of a west Wichita Chinese restaurant have been arrested in connection with an indictment alleging that they employed undocumented workers, U. S. Attorney Barry Grissom announced Tuesday.
The operators, Yong “Tony” Lin, 33, and his wife, Zhuo Mei “Mandy” Weng, 29, both of Wichita, were arrested Tuesday by agents of the U.S. Department of Homeland Security (DHS) on warrants issued in connection with a federal indictment. The indictment charges conspiracy and harboring of aliens unlawfully in the United States, Grissom said.
“The U.S. Attorney’s office is aggressively pursuing employers who knowingly hire undocumented and falsely-documented workers,” Grissom said Tuesday. “When a business engages in this practice, it not only encourages illegal immigration, it also gives the employer an unfair advantage in the marketplace. We have several more ongoing investigations along these lines.”
Agents of Homeland Security Investigations (HSI), in cooperation with the Wichita Police Department, also executed search warrants at three west Wichita apartments and the restaurant, World Buffet Grill, 2243 N. Ridge Rd., Grissom said. Lin and Weng were booked into the Sedgwick County jail and are scheduled to make an initial court appearance at 1:30 p.m. Wednesday before U.S. Magistrate Judge Kenneth Gale.
The indictment, which was sealed after its filing on Sept. 11, alleges two counts of conspiracy and six counts of harboring, in addition to seeking criminal forfeiture of assets associated with the alleged crimes. If convicted, the defendants face a maximum of five years in prison on each of the eight counts. As in any criminal case, the defendants are presumed innocent until and unless proven guilty.
The indictment alleges that defendants Lin and Weng paid employees in cash, failed to withhold for taxes and Social Security, failed to maintain unemployment and workers compensation insurance, and failed to complete and maintain DHS Employment Eligibility Authorization (I-9) forms.
The case was investigated by HSI with the assistance of the Wichita Police Department, the Exploited and Missing Children’s Unit, and the Sedgwick County District Attorney’s office. The prosecutors are Brent Anderson and Jason Hart, both assistant United States attorneys.Convicted Santa Cruz Sex Offender Sentenced to Ten Years in Prison for Possessing Child PornographyRead the Press Release
SAN JOSE, CA – Steven Hibbett was sentenced yesterday afternoon to ten years in prison for possession of child pornography, United States Attorney Melinda Haag announced.
On July 29, 2013 Hibbett pleaded guilty to an Information alleging possession of child pornography in violation of 18 U.S.C. § 2252(a)(4)(B). In pleading guilty, Hibbett, 59, of Santa Cruz, admitted that he downloaded child pornography from the Internet onto a laptop computer that law enforcement seized from a Santa Cruz storage locker. Hibbett also admitted that he knowingly possessed over 600 images of child pornography, including images of prepubescent minors and images portraying sadistic or masochistic conduct. Hibbett also admitted that he possessed these images of child pornography while on state probation for a prior 2009 California felony conviction for possessing child pornography.
The Honorable Edward J. Davila, U.S. District Court Judge, handled down the ten year sentence. Judge Davila also sentenced the defendant to a five-year period of supervised release and ordered him to register as a sex offender and to participate in a sex offender treatment program. Hibbett has been in federal custody since was originally charged by complaint and made his initial appearance in federal court on April 18, 2013.
Assistant U.S. Attorney Joseph Fazioli prosecuted the case with the assistance of Laurie Worthen. The prosecution is a result of an investigation by the Federal Bureau of Investigation and the Santa Cruz Police Department.
Convenience Store Robber ChargedRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced the filing of a Criminal Information in U.S. District Court in Scranton on October 16, charging Daniel Ortiz, age 28, of Watertown, New York, with the four robberies of convenience stores in April and May 2011.
According to United States Attorney Peter J. Smith, Ortiz allegedly robbed the Hilltop Sunoco / Extra Mart located at 238 State Route 6, Milford, Pennsylvania on April 6, 2011; the Turkey Hill Minit Market, 912 Pennsylvania Avenue, Matamoras, Pennsylvania, on April 11, 2011; the Hilltop Sunoco / Extra Mart located at 238 State Route 6, Milford, Pennsylvania on April 17, 2011; and the Turkey Hill Minit Market, 912 Pennsylvania Avenue, Matamoras, Pennsylvania, on May 5, 2011. In doing so, Ortiz brandished weapons to instill fear to facilitate the robberies.
The case was investigated by the Federal Bureau of Investigation, the Eastern Pike Regional Police Department, and the Pennsylvania State Police. Prosecution is assigned to Assistant United States Attorney John Gurganus.
Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this particular case, the maximum penalty under the federal statute is 80 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Co-Owner of Altoona Spa Transported Person for ProstitutionRead the Press Release
JOHNSTOWN, Pa. - A resident of Suwanee, GA, pleaded guilty in federal court to a charge of transportation for illegal sexual activity, United States Attorney David J. Hickton announced today.
Yon Park, 60, of pleaded guilty to one count before United States District Judge Kim R. Gibson.
In connection with the guilty plea, the court was advised that on Feb. 14, 2011, Park, while the owner of The SunSet Health Spa, located on Pleasant Valley Boulevard, Altoona, PA, caused an individual to be transported in interstate or foreign commerce, with the intent that such individual engage in prostitution, or in any sexual activity for which any person can be charged with a criminal offense.
Judge Gibson scheduled sentencing for February 24, 2014, at 10 a.m. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephanie L. Haines is prosecuting this case on behalf of the government.
The Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the Pennsylvania State Police conducted the investigation that led to the prosecution of Park.
Citizen of Cameroon Indicted for Hindering RemovalRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania and the U.S. Department of Homeland Security, Immigrations and Customs Enforcement, announced that a 44- year-old native and citizen of Cameroon was charged with hindering removal from the United States.
According to United States Attorney Peter J. Smith, Patrice Talbot, age 44, a native and citizen of Cameroon, in the United States illegally was charged in a one-count indictment returned on October 9 by a federal grand jury in Harrisburg.
The indictment alleges that Talbot, an alien who was under a final order of removal from the United States, did connive, conspire, and take action that was designed and intended to prevent and hamper his departure from the United States.
This investigation was conducted by the U.S. Department of Homeland Security, Immigration and Customs Enforcement and is being prosecuted by Special Assistant United States Attorney Brian G. McDonnell.Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is four years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Central Kentucky Glass Company and Its Former President Charged with Fraud in Connection with the Installation of Glass and Windows at Ft. Knox High SchoolRead the Press Release
– Indictment includes wire fraud, mail fraud and major fraud against the United States
LOUISVILLE, Ky. – Central Kentucky Glass Company, headquartered in Lexington, Kentucky, was indicted by a federal grand jury meeting in Louisville, Kentucky on October 16, 2013, on charges of wire fraud, mail fraud and major fraud against the United States in connection with a multi-million dollar contract at Fort Knox High School, announced David J. Hale, United States Attorney for the Western District of Kentucky. The former president of Central Kentucky Glass Company, Dennis Martin of Nicholasville, Kentucky, was charged separately, on October 21, 2013, in a federal Information.
Central Kentucky Glass Company was a subcontractor hired by the prime contractor, Barton Malow Company, as part of a multi-million dollar Army Corps of Engineers project which included the installation of glass and windows at Fort Knox High School, located in Hardin County, Kentucky. Central Kentucky Glass Company was required to provide certifications that its glass and windows were tested and met contract requirements, including anti-terrorism standards. According to the three count indictment, on October 22, 2008, Martin, then president of Central Kentucky Glass Company, allegedly forged two certifications from testing companies that falsely reflected that Central Kentucky Glass Company’s glass and windows had been tested and met contract requirements, including anti-terrorism standards. Further, the indictment charges that on March 16, 2009, Dennis Martin forged a certification from another company and provided the forged certification to the Barton Malow Company. Subsequent tests revealed that the glass and windows Central Kentucky Glass Company installed at Fort Knox High School failed to meet anti-terrorism standards.
Martin is charged separately with a single count of wire fraud for allegedly forging the certifications from two testing companies, then faxing the forged documents to Barton Malow Company in Ohio.
If convicted, the company faces a maximum fine of $6,000,000, and a three year period of supervised release. Martin faces no more than 20 years in prison, a fine of $250,000 and a three year period of supervised release.
This case is being prosecuted by Assistant United States Attorney David Weiser and is being investigated by the Department of Defense Office of Inspector General.
The indictment of a company by a Grand Jury is an accusation
only and that company is presumed innocent until and unless
proven guilty.Cement Contractor Sentenced to Incarceration in Tax CaseRead the Press Release
WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announces that Jeffrey Justison, age 44, of Elkton, Maryland, was sentenced today by United States District Court Judge Richard G. Andrews to six months incarceration, followed by six months house arrest, for failure to collect, and pay over to the IRS, federal income taxes from his employees.
According to statements made at the sentencing hearing and documents filed in court, Jeffrey Justison owns Double J Concrete, Inc., which he operates from his Elkton home. From June 2007 through December 2010, Justison performed concrete jobs in Delaware and surrounding states, maintaining approximately 20 workers. Justison paid his employees in cash, failing to collect from them, and to pay over to the IRS, Federal Income Tax and Federal Insurance Contribution Act (FICA) taxes. He further failed to pay to the IRS his matching employer’s portion of FICA taxes, resulting in a total of $184,829 in unpaid taxes.
Following the sentencing, Charles M. Oberly, III, United States Attorney for the District of Delaware, stated, “The criminal tax laws are designed to protect the public interest in preserving the integrity of our nation’s tax system. Today’s sentence should serve as a deterrent to would-be violators.”
"IRS Criminal Investigation realizes the detrimental consequences of employment tax evasion. It results in the loss of tax revenue to the United States government and the loss of future social security or Medicare benefits for the employees," stated Akeia Conner IRS Special Agent in Charge. "Today's sentencing should serve as a deterrent to employers that take lightly their responsibility to collect and pay over employment taxes."
This case was investigated by the Internal Revenue Service - Criminal Investigation Division and prosecuted by Assistant United States Attorney Edmond Falgowski.
Carbon County Man Pleads Guilty to Federal Firearms ChargesRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Carbon County man pleaded guilty on October 9, before Senior United States District Judge Edwin M. Kosik, to the charge of being an unlawful user of controlled substances in possession of firearms.
According to United States Attorney Peter J. Smith, Jordan Bachert, age 29, of Lansford, Carbon County, admitted to being an unlawful user of controlled substances in 2011 and 2012, a time period in which he purchased and possessed several firearms in Carbon County.
The case resulted from an investigation concerning drug and firearms trafficking in Carbon and Schuylkill Counties conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Nesquehoning and Lansford Police Departments in Carbon County.
The case is being prosecuted by Assistant United States Attorney Robert J. O’Hara.
Senior Judge Kosik ordered that a presentence investigation take place. A sentencing date has not yet been scheduled.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this case, the maximum penalty under the federal statute is imprisonment for ten years, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public, and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.