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Tuesday 24 September 2013
Wesley Allen Cross Guns Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney(s Office announced that during a federal court session in Great Falls, on September 24, 2013, before U.S. Magistrate Judge Keith Strong, WESLEY ALLEN CROSS GUNS, a 24-year-old resident of Browning and an enrolled member of the Blackfeet Tribe, pled guilty to burglary. Sentencing has been set for January 16, 2014. He is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Ryan G. Weldon, the government stated it would have proved at trial the following:
On February 4, 2012, "Jane Doe" was in Great Falls because her father was in the hospital. Three individuals walked by her residence in Browning, which was located within the exterior boundaries of the Blackfeet Indian Reservation.
On February 4, 2012, a neighbor was out on his porch and observed three male individuals walking by his neighbor's residence. While he saw the three individuals walking by the residence, he did not see them pass by. He then heard three kicks and he knew that someone was breaking into "Jane Doe's" residence. He told his wife to call their son who is an officer with the Blackfeet Law Enforcement Services.
His wife called their son and then she grabbed her camera. When their son, the officer, pulled up, the officer and the neighbor went into "Jane Doe"'s residence. The neighbor's wife then took pictures of all three individuals running out of the house. The burglary occurred in broad daylight.
The individuals who broke into the house then climbed the fence, and CROSS GUNS escaped. Dustin Jay After Buffalo and Michael Bad Old Man were caught. Bad Old Man had items in his pockets. While waiting for law enforcement to arrive, Bad Old Man stated that he was going to kill the neighbor and the officer when he gets out of jail.
After backup arrived, the officer took pictures of "Jane Doe's" front door to the residence. The door was damaged. The officer stated that he was able to identify all three defendants by name when he saw them in the residence. In particular, the one who had escaped, CROSS GUNS, because he is aware of and knows CROSS GUNS.
When questioned, After Buffalo stated that he did not remember the incident because he was high on methamphetamine. After Buffalo however acknowledged that he "come to" while he was in the house. He stated that after entering the house, the other two individuals started throwing things in their pockets and ordering After Buffalo to do the same. After Buffalo stated that Bad Old Man kicked the door in and he claimed that the other two were going to beat him up if he did not go in there with them. After Buffalo stated that when the cops showed up he ran outside the back door, jumped a fence, and that the officer "beat him up with a bat." After Buffalo then identified all 3 individuals in the photos the neighbor's wife had taken. After Buffalo claimed that he never took anything from the house but stated that he did eat a sandwich in the house.
Bad Old Man and After Buffalo pled guilty to federal charges.
CROSS GUNS faces possible penalties of 20 years in prison, a $20,000 fine and 3 years supervised release.
The investigation was conducted by the Bureau of Indian Affairs.
Webster Man Charged with Distributing CrackRead the Press Release
BOSTON – A Webster man was charged yesterday for selling crack cocaine to a cooperating witness.
Anthony Cruz, 27, was charged in a criminal complaint with conspiracy to distribute cocaine and distribution of crack cocaine.
The complaint alleges that on January 23, 2012, and again on February 3, 2012, Cruz sold 35 grams of crack cocaine to a cooperating witness in Webster. On July 17, 2013, Cruz agreed to sell the cooperating witness another 40 grams of crack cocaine. On the day of the deal, Cruz arranged the transaction and another individual, working with Cruz, distributed a controlled substance to the cooperating witness. Preliminary tests indicated that the substance tested positive for cocaine. Cruz was arrested on September 20, 2013 after distributing approximately 150 grams of a substance purported to be crack cocaine to the cooperating witness.
If convicted, Cruz faces a minimum mandatory sentence of five years and up to 40 years in prison, a minimum of four years and up to a lifetime of supervised release and a $5 million fine.
United States Attorney Carmen M. Ortiz; John J. Arvanitis, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Daniel J. Kumor, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; and Chief Timothy J. Bent of the Webster Police Department, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Karin M. Bell of Ortiz’s Worcester Branch Office.
The details contained in the complaint are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Vail, Iowa, Man to Federal Prison for Meth ChargesRead the Press Release
A man who possessed with intent to distribute methamphetamine was sentenced September 19, 2013, to 10 years in federal prison.
Jeffrey Duane Krowiorz, II, 25, from Vail, Iowa, received the prison term after a March 16, 2013, guilty plea to possessing with intent to distribute methamphetamine.
At the guilty plea, Krowiorz admitted that on September 28, 2012, he possessed over 18 grams of actual (pure) methamphetamine and intended to distribute the methamphetamine to other persons. Krowiorz attempted to flee (on foot) when officers made contact with him regarding an outstanding arrest warrant. Krowiorz was apprehended a short distance away and officers seized from Krowiorz three separate baggies of methamphetamine concealed within a body spray container converted into a storage container.
Krowiorz was sentenced in Sioux City by United States District Court Judge Donald E. O’Brien. Krowiorz was sentenced to 120 months’ imprisonment. A special assessment of $100 was imposed. He must also serve an eight-year term of supervised release after the prison term. There is no parole in the federal system. Krowiorz is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Department of Narcotics Enforcement, Spirit Lake Police Department, and the Iowa Division of Criminal Investigations.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 12-4098.U.S. Attorney, Dea and Fbi to Hold Press Conference to Announce Major Law Enforcement ActionRead the Press Release
AMARILLO, Texas —– Sarah R. Saldaña, U.S. Attorney for the Northern District of Texas, Dan R. Salter, Acting Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Dallas Field Division, and Diego Rodriguez, Special Agent in Charge for the FBI Dallas Division will host a Press Conference TODAY, TUESDAY, SEPTEMBER 24, 2013, AT 2:00 P.M. to announce a major law enforcement action in Amarillo.
DIGNATARIES ATTENDING INCLUDE:
Sarah R. Saldaña, U.S. Attorney, Northern District of Texas
John Parker, First Assistant U.S. Attorney, Northern District of Texas
Dan R. Salter, Acting Special Agent in Charge, DEA Dallas Field Division
Diego Rodriguez, Special Agent in Charge, FBI Dallas Division
Brian Thomas, Sheriff, Potter County
Scott Brumley, County Attorney, Potter County
Randall Sims, District Attorney, Potter County
Joel Richardson, Sheriff, Randall County
James Farren, District Attorney, Randall County
Robert Taylor, Amarillo Police Chief Randy Prince, Regional Commander, Texas Department of Public SafetyWHAT: Press conference to announce major law enforcement action in Amarillo
WHEN: TUESDAY, SEPTEMBER 24, 2013
2:00 p.m.WHERE: J. Marvin Jones Federal Building and U.S. Courthouse*
205 East Fifth Street (Front Steps)
Amarillo, Texas*In case of inclement weather, Press Conference will be held at Randall County Sheriff’s Office located at 9100 S. Georgia St., in Amarillo.
Press inquiries regarding logistics should be directed to Kathy Colvin at 214-659-8600 or [email protected].
Two Florida Residents Plead Guilty to Defrauding and Threatening Spanish-Speaking ConsumersRead the Press Release
Two individuals charged with running a telemarketing operation that defrauded Spanish-speaking consumers pleaded guilty today to one count of conspiracy to commit mail fraud, the Department of Justice and U.S. Postal Inspection Service (USPIS) announced. Daniel Carrasco, 54, and Federico Martin Gioja, 45, both of Miramar, Fla., pleaded guilty in the U.S. District Court for the Southern District of Florida in Miami to charges alleging they owned and operated Florida companies that used a telemarketing sales room in Argentina to consistently lie to consumers about products they would receive and to threaten consequences of failure to pay for shipments.“The Department of Justice is committed to protecting consumers from fraud,” said Stuart F. Delery, Assistant Attorney General for the Civil Division. “As these guilty pleas demonstrate, we will be particularly vigilant towards schemes that target specific populations, and we will not be deterred by those who seek to evade detection by changing the name of their fraudulent companies.”
Carrasco’s and Gioja’s telemarketers promoted products such as vitamins, lotions and English-language training products. They also promised buyers would receive valuable gifts such as expensive watches and perfumes, gift cards and medical assistance and insurance. However, the companies frequently did not deliver products ordered by consumers. Since the companies did not have many of the products they promised to send to consumers, consumers received other products instead. Then, after consumers refused delivery of the companies’ shipments, the Argentinian phone room telemarketers called and falsely threatened consumers with arrest, deportation or fines on their gas and electric bills.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, stated: “ Fraud, of any kind, is unacceptable. Fraud by threat and intimidation is particularly troublesome because it targets the perceived, but oftentimes real, vulnerabilities of those preyed upon. In this case, the defendants targeted Spanish-speaking consumers and falsely threatened them with arrest and deportation when the consumers refused delivery for products they had not ordered. Such tactics are intolerable. Together with the Department of Justice’s Civil Division, Consumer Protection Branch, we stand united to stem such fraud.”
As part of their guilty pleas, Carrasco and Gioja admitted they routinely changed the names of the companies under which they did business to evade consumer complaints, regulators and law enforcement. A variety of state agencies contacted the businesses regarding their illicit practices. Those working with Carrasco and Gioja, in emails cited in the affidavit in support of arrest, referred to these companies tainted by complaints as “burnt.” Rather than changing the “burnt” companies’ practices, Carrasco and Gioja incorporated new companies and started the same illegal practices again.Also in pleading guilty, Carrasco and Gioja admitted their telemarketers falsely represented to consumers that they were affiliated with Spanish-language television networks. The alleged fraud first came to light when the Spanish language network Univision informed the USPIS they believed a company was involved in a fraud scheme in which it misrepresented its affiliation with the network. Subsequently, the Postal Inspection Service investigated the case, submitted the affidavit in support of the criminal complaint and arrested the defendants.
"The U.S. Postal Inspection Service is committed to unraveling operations that scheme to defraud innocent people,” said Ronald Verrochio, U.S. Postal Inspector in Charge in Miami. "Our postal inspectors aggressively investigate mail fraud scams such as this one, with a concerted effort to protect consumers.”
Carrasco and Gioja originally were charged by criminal complaint and arrested on June 26, 2013. Both defendants were later indicted on July 25, 2013. They have remained incarcerated since that time. Carrasco and Gioja, and a third individual, Romino Tasso, also were named in a civil suit filed by the Justice Department. In the civil case, the Justice Department requested and obtained a preliminary injunction barring further lies to consumers and freezing the assets of Carrasco, Gioja, Tasso and companies under their control.Assistant Attorney General Delery commended the Postal Inspection Service for their investigative efforts and thanked the U.S. Attorney’s Office for the Southern District of Florida for their contributions to the civil case. The criminal case was prosecuted by Assistant Director Richard Goldberg with the Department of Justice’s Civil Division, Consumer Protection Branch and Assistant U.S. Attorney Timothy Abraham of the Southern District of Florida.
Two Florida Residents Plead Guilty to Defrauding and Threatening Spanish-Speaking ConsumersRead the Press Release
Two individuals charged with running a telemarketing operation that defrauded Spanish-speaking consumers pleaded guilty today to one count of conspiracy to commit mail fraud, the Department of Justice and U.S. Postal Inspection Service (USPIS) announced. Daniel Carrasco, 54, and Federico Martin Gioja, 45, both of Miramar, Fla., pleaded guilty in the U.S. District Court for the Southern District of Florida in Miami to charges alleging they owned and operated Florida companies that used a telemarketing sales room in Argentina to consistently lie to consumers about products they would receive and to threaten consequences of failure to pay for shipments.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, stated: “Fraud, of any kind, is unacceptable. Fraud by threat and intimidation is particularly troublesome because it targets the perceived, but oftentimes real, vulnerabilities of those preyed upon. In this case, the defendants targeted Spanish-speaking consumers and falsely threatened them with arrest and deportation when the consumers refused delivery for products they had not ordered. Such tactics are intolerable. Together with the Department of Justice’s Civil Division, Consumer Protection Branch, we stand united to stem such fraud.”
“The Department of Justice is committed to protecting consumers from fraud,” said Stuart F. Delery, Assistant Attorney General for the Civil Division. “As these guilty pleas demonstrate, we will be particularly vigilant towards schemes that target specific populations, and we will not be deterred by those who seek to evade detection by changing the name of their fraudulent companies.”
Carrasco’s and Gioja’s telemarketers promoted products such as vitamins, lotions and English-language training products. They also promised buyers would receive valuable gifts such as expensive watches and perfumes, gift cards and medical assistance and insurance. However, the companies frequently did not deliver products ordered by consumers. Since the companies did not have many of the products they promised to send to consumers, consumers received other products instead. Then, after consumers refused delivery of the companies’ shipments, the Argentinian phone room telemarketers called and falsely threatened consumers with arrest, deportation or fines on their gas and electric bills.
As part of their guilty pleas, Carrasco and Gioja admitted they routinely changed the names of the companies under which they did business to evade consumer complaints, regulators and law enforcement. A variety of state agencies contacted the businesses regarding their illicit practices. Those working with Carrasco and Gioja, in emails cited in the affidavit in support of arrest, referred to these companies tainted by complaints as “burnt.” Rather than changing the “burnt” companies’ practices, Carrasco and Gioja incorporated new companies and started the same illegal practices again.
Also in pleading guilty, Carrasco and Gioja admitted their telemarketers falsely represented to consumers that they were affiliated with Spanish-language television networks. The alleged fraud first came to light when the Spanish language network Univision informed the USPIS they believed a company was involved in a fraud scheme in which it misrepresented its affiliation with the network. Subsequently, the Postal Inspection Service investigated the case, submitted the affidavit in support of the criminal complaint and arrested the defendants.
"The U.S. Postal Inspection Service is committed to unraveling operations that scheme to defraud innocent people,” said Ronald Verrochio, U.S. Postal Inspector in Charge in Miami. "Our postal inspectors aggressively investigate mail fraud scams such as this one, with a concerted effort to protect consumers.”
Carrasco and Gioja originally were charged by criminal complaint and arrested on June 26, 2013. Both defendants were later indicted on July 25, 2013. They have remained incarcerated since that time. Carrasco and Gioja, and a third individual, Romino Tasso, also were named in a civil suit filed by the Justice Department. In the civil case, the Justice Department requested and obtained a preliminary injunction barring further lies to consumers and freezing the assets of Carrasco, Gioja, Tasso and companies under their control.
Assistant Attorney General Delery commended the Postal Inspection Service for their investigative efforts and thanked the U.S. Attorney’s Office for the Southern District of Florida for their contributions to the civil case. The criminal case was prosecuted by Assistant Director Richard Goldberg with the Department of Justice’s Civil Division, Consumer Protection Branch and Assistant U.S. Attorney Timothy Abraham of the Southern District of Florida.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Chicago Men Indicted on Heroin ChargesRead the Press Release
An indictment was filed charging Marcellus C. Lee, age 33, and Gregory A. Collins, aka “D.D.”, age 36, both of Chicago, with one count of conspiracy to distribute a kilogram of heroin and with one count of possession with intent to distribute heroin, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment results from an investigation conducted by the Northern Ohio Law Enforcement Task Force (NOLETF), in Cleveland, Ohio. The NOLETF is a long standing multi-agency task force comprised of investigators from the Federal Bureau of Investigation, Cuyahoga Metropolitan Housing Authority, Drug Enforcement Administration, Internal Revenue Service, Immigration and Customs Enforcement, Cleveland Division of Police, Cleveland Heights Police Department, Cuyahoga County Sheriff’s Office, Euclid Police Department, Regional Transit Authority Police Department, Strongsville Police Department, Westlake Police Department and Shaker Heights Police Department. The NOLETF is also one of the initial Ohio High Intensity Drug Trafficking Area (HIDTA) initiatives. The HIDTA Program supports and helps coordinate numerous Ohio drug task forces in their efforts to eliminate or reduce drug-trafficking in Ohio. The case is being prosecuted by Assistant United States Attorney Christian H. Stickan.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.Topeka Man Charged with RobberyAt Kaw Valley BankRead the Press Release
TOPEKA, KAN. - A Topeka man who was arrested in Omaha has been charged with bank robbery, U.S. Attorney Barry Grissom said today.
A criminal complaint was unsealed today charging Cade Michael Sharples, 36, Topeka, Kan., with one count of bank robbery. The complaint alleges that on Sept. 17 Sharples robbed the Kaw Valley Bank at 3000 SE Croco Road. According to an investigator’s affidavit, a white male entered the bank about 2:45 p.m. and gave a teller a piece of paper saying he was there to rob the bank and he had a gun. The robber told the clerk several times that he had a gun and ordered her to hurry up and “stop messing around.” The man left the bank with money in a black bag.
After investigators made public surveillance photos of the robber wearing a gray hoodie, a blue shirt and a blue University of Kansas baseball hat, they received tips that led them to Sharples.
If convicted, he faces a maximum penalty of 20 years in federal prison and a fine up to $250,000. The Topeka Police Department and the FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Telemarketer Sentenced in Manhattan Federal Court to 75 Months in Prison for Sweepstakes Fraud That Targeted Elderly VictimsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced that WARREN STELMAN, a/k/a “Dave Ford,” was sentenced today to 75 months in prison for his participation in a Dominican-based telemarketing fraud scheme that targeted elderly victims throughout the United States and defrauded those victims of nearly $1 million. STELMAN was arrested in the Dominican Republic in August 2012 and was subsequently extradited to the United States. He pled guilty in January 2013 to one count of wire fraud. Today’s sentence was imposed by U.S. District Judge Lewis A. Kaplan.
Manhattan U.S. Attorney Preet Bharara said: “Warren Stelman admitted scheming in the Dominican Republic to fleece elderly people in the U.S. His pitch, dangling fictitious sweepstakes winnings, was persuasive enough to victimize many of these people repeatedly. Today he has been ordered to pay for his crime against these vulnerable victims in money and time.”
FBI Assistant Director-in-Charge George Venizelos said: “The defendant hid behind his telephone to prey upon his victims, many of whom were elderly, with promises of money and prizes. Although the victims never met the defendant, they relied upon his representations of wealth and in exchange, turned over their hard earned money. This case should be a reminder to the public to be cautious of get-rich-quick opportunities, many of which are merely schemes to defraud and take advantage of our unsuspecting community.”
According to the Indictment and other documents filed in Manhattan federal court, as well as statements made in court proceedings:
STELMAN and his co-conspirators, including his wife Lana Stelman, operated boiler rooms in the Dominican Republic, from which they telephoned victims in the United States, most of whom were elderly. They informed the victims falsely that they had won substantial amounts of cash through a sweepstakes or some other type of promotion, but that in order to claim their prize, they first needed to wire thousands of dollars in “fees” to the Dominican Republic. In reality, however, there were no cash prizes, neither STELMAN nor his co-conspirators worked in connection with a sweepstakes or other promotion, and none of the victims ever received any money in exchange for their fees.
The victims were typically told to send the money for the purported fees by, among other means, Western Union or Money Gram. After victims sent money to cover the supposed fees, STELMAN and his co-conspirators typically contacted them again and, using further fraudulent representations, persuaded them to send more money to pay for other costs. In some instances, when victims said that they had run out of money to pay additional fees, STELMAN and his associates urged the victims to come up with more money by borrowing from friends and relatives, taking cash advances on credit cards, and obtaining loans against their homes and vehicles.
The fraudulent scheme targeted U.S. residents who had previously subscribed to sweepstakes. STELMAN and his co-conspirators identified these victims by purchasing from U.S.-based brokers copies of sweepstakes entry forms the victims had previously filled out. These entry forms, which the conspirators referred to as “leads,” were typically written on narrow slips of paper that included the names, addresses, and telephone numbers for sweepstakes entrants. The conspirators used various Internet-based phone methods to mask their locations and identities, and communicated with the victims through numbers assigned to voicemail boxes located in Manhattan. In total, 78 victims – 54 of whom were over the age of 70 – were defrauded out of nearly $1 million.
In addition to the prison term, Judge Kaplan sentenced STELMAN, 54, of the Dominican Republic, to three years of supervised release. STELMAN was also ordered to forfeit $996,659.30 and to pay a total of $996,659.30 in restitution to 78 victims.
Four other defendants – Lana Stelman, Romeo Rawlins, Juana Santana and Lickenson Brooks – were also charged for their participation in the scheme. Lana Stelman and Brooks pled guilty and are awaiting sentencing. Charges remain pending against Rawlins and Santana, and they are presumed innocent until and unless they are proven guilty.
In related cases, Janice Pemberton, Peter Gruman, Randy Ortzman, and Avraham Fried were charged with participating in similar telemarketing fraud schemes from the Dominican Republic. All of these defendants have pled guilty. Fried was sentenced on September 10, 2013 by U.S. District Judge William H. Pauley to 44 months in prison. Pemberton, Gruman, and Ortzman are awaiting sentencing.
Mr. Bharara praised the outstanding investigative work of the FBI.
The prosecution of this case is being handled by the Office’s Complex Frauds Unit. Assistant United States Attorneys Thomas G. A. Brown and Rosemary Nidiry are in charge of the prosecution.
Stamford Man Pleads Guilty to Leading Illegal Gambling RingRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that STEPHEN JOYCE, 45, of Stamford, pleaded guilty today before Senior U.S. District Judge Alfred V. Covello in Hartford to one count of operating an illegal gambling business.
According to court documents and statements made in court, between January 2008 and August 2011, JOYCE led a lucrative illegal sports bookmaking operation in Stamford that involved at least five other bookmakers.
On July 27, 2011, investigators conducted a court-authorized search of JOYCE’s Stamford residence and seized extensive gambling records, a laptop computer and other items.
Judge Covello has scheduled sentencing for December 17, 2013, at which time JOYCE faces a maximum term of imprisonment of five years and a fine of up to $250,000.
JOYCE also has agreed to forfeit $175,000 in gambling proceeds.
This matter is being investigated by the FBI Fairfield County Organized Crime Task Force, the Internal Revenue Service – Criminal Investigation, the Stamford Police Department, the Bridgeport Police Department and the Connecticut State Police. This case is being prosecuted by Assistant U.S. Attorney Hal Chen.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Stakeholders Partner to Convene the Worcester Reentry Initiative ProgramRead the Press Release
BOSTON – United States Attorney Carmen M. Ortiz announced today her office’s partnership with the Worcester Reentry Initiative Program. Drawing on its experience with reentry programs throughout the Commonwealth, the U.S. Attorney’s Office in partnership with the Worcester County Sheriff’s Office, Worcester County District Attorney’s Office and Worcester Police Department convened the initiative, bringing together important stakeholders in an effort to reduce recidivism rates.
A 2008 study funded by the Urban Institute Justice Policy Center, reported that four out of 10 inmates returning from prison in Massachusetts are re-incarcerated within three years of being released. The federal statistics are equally, if not more stark. Even though the United States comprises just five percent of the world’s population, it incarcerates almost 25% of the world’s prisoners. More than 219,000 federal inmates are currently behind bars. Almost half of them are serving time for drug-related crimes, and many have substance use disorders. Nine to 10 million more people cycle through America’s local jails each year. And roughly 40% of former federal prisoners – and more than 60% of former state prisoners – are rearrested or have their supervision revoked within three years after their release, at great cost to American taxpayers and often for technical or minor violations of the terms of their release.
Citing those above statistics in a speech last month, U.S. Attorney General Holder said that while the aggressive enforcement of federal criminal statutes remains necessary, we cannot simply prosecute or incarcerate our way to becoming a safer nation. To be effective, federal efforts must also focus on prevention and reentry.
U.S. Attorney Ortiz said, “We must never stop being tough on crime. But we must also be smart and efficient when battling crime and understanding the conditions and individual choices which cause it. We look forward to the interagency and community partnerships that will measurably contribute to a decrease in crime and improvement in the quality of life for Massachusetts residents.”
“The cooperation on this initiative among law enforcement and social service agencies has been spectacular. It is never a good idea have a prisoner behind bars one day and out on the street the next day without some sort of re-entry buffer. That is a recipe for failure. Having so many parties working together to allow a former prisoner to reintegrate into the lawful parts of society gives us the best chance to stop recidivism. Without these services we have a pretty good idea that history will just repeat itself,” said Worcester County District Attorney Joseph D. Early Jr.
The Worcester Reentry Initiative Program is part of a nationwide trend to reform the paradigm of punishing repeat criminals with more prison time. Through the Worcester Reentry Initiative Program, federal, state, and local law enforcement join forces with social service agencies, mental health and substance abuse providers and faith-based organizations to tackle the complexities associated with reentry into the community after incarceration. Members of the Worcester Reentry Initiative Program will work with an average of 90 to 100 high-risk inmates per year.
High-risk prisoners agreeing to participate in this reentry program will be provided with information regarding pre- and post-incarceration services as well as the consequences of reoffending. Law enforcement, probation/parole officers and prosecutors, including a representative from the U.S. Attorney’s Office, will conduct meetings every other month with Worcester Reentry Initiative Program participants in an effort to educate them about the realities of future criminal behavior. For many, reoffending could result in significant state or federal prison sentences.
Through the Worcester Reentry Initiative Program, participants will be offered “wrap-around” services, receiving focused assistance from social service providers, case managers, parole and probation officers and others to ensure accountability and continuity of care. They will be provided enhanced opportunities to participate in employment training, education programs, substance abuse and mental health treatment, and to work with mentors. Pre-release, participants will be encouraged to build relationships with individuals representing resources that are needed for success on the outside, including the parole or probation officer who is a crucial component of the program. Participants will undergo intense supervision upon release from prison to ensure greater success and accountability.
The Worcester Reentry Initiative Program social services and mental health partners include: Worcester Sheriff’s Department After Incarceration Support Services, Massachusetts Department of Revenue, Spectrum Health Systems, Valley Psychiatric Services and the Counseling and Psychotherapy Center, Worcester Community Action Council, Workforce Central, the WISR Program and Straight Ahead Ministries.
The Worcester Reentry Initiative Program model is based on the award-winning Boston Reentry Initiative (BRI), which has achieved measurable success and national attention for its model of recidivism reduction. Both programs focus their resources on inmates who pose the greatest risks to reoffend.
St. Joseph Police Detective Indicted for Firearm ViolationRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a longtime detective with the St. Joseph, Mo., Police Department was indicted by a federal grand jury today for aiding and abetting another person to illegally possess a firearm that he used in a gang-related shooting.
“A sworn law enforcement has been charged with allowing a known violent criminal to keep his gun, even after it was used in a gang-related shooting,” Dickinson said. “Today’s indictment alleges a reckless violation of the public trust and blatant disregard of his duty to uphold the law.”
Scott Thomas Coates, 42, of St. Joseph, was charged in an indictment returned by a federal grand jury in Kansas City, Mo.
According to the indictment, Coates (in his official capacity as a police detective) interviewed Corey Andrew Barr on Oct. 24, 2007, about a recent gang-related shooting near 22nd and Messanie in St. Joseph. Barr admitted that he had brandished a Smith and Wesson .40-caliber handgun and fired four or five shots at other persons during the shootout. Barr brought the handgun with him to his interview with Coates, the indictment says, who merely photographed the gun and allowed Barr to leave with the handgun at the end of the interview.
Coates permitted Barr to leave with the handgun and to continue to possess the handgun, the indictment says, despite the fact that he knew Barr was prohibited by federal law from possessing a firearm due to his 2005 conviction for domestic violence.
Coates was ordered by a superior officer to locate Barr and seize the handgun, which he did on the same day. However, the indictment says, Coates did not book the firearm into evidence until July 7, 2009, more than 20 months later.
On Sept. 1, 2010, Coates allegedly caused the handgun to be returned to Barr, despite the fact that Barr was still prohibited by federal law from possessing any firearm. By that time, Barr had a second conviction for domestic violence. This alleged conduct by Coates forms the basis of today’s federal indictment for aiding and abetting the possession of a firearm by a prohibited person.
Barr was arrested on Sept. 7, 2010, when St. Joseph police officers responded to a disturbance call involving people with firearms, including assault rifles. A witness told officers that one of the men involved in the disturbance was walking through a nearby park. Officers located Barr in the park; he was carrying the loaded handgun in a holster on his waist. Barr was indicted by a federal grand jury for illegally possessing a firearm. After pleading guilty, Barr was sentenced to 47 months in federal prison.
Dickinson cautioned that the charge contained in this indictment is simply an accusation, and not evidence of guilt. Evidence supporting the charge must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Deputy U.S. Attorney Gene Porter. It was investigated by the FBI, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives and the cooperation of officers from the St. Joseph, Mo., Police Department.Springfield Landlord Charged with FraudRead the Press Release
BOSTON – A Springfield man was charged yesterday in U.S. District Court in Springfield with making fraudulent claims for insurance proceeds following fires at two multi-family homes in Springfield.
Wilkenson Knaggs, 42, was indicted with mail fraud, forging check endorsements, and money laundering.
The Indictment alleges that following a November 16, 2008 fire on Franklin Street, Knaggs submitted a fraudulent contract for rehabilitating the three-family house in order to obtain a payout on his homeowner’s policy. He is also charged with forging the endorsement of the City of Springfield on a second check, cashing the check at a Boston check cashing company, and using the proceeds to buy a two-family house at on Central Street. The Indictment also charges Knaggs with putting the title of the Central Street property in the name of a relative and using the relative to make a claim on the insurance policy after a March 7, 2010 fire.
If convicted, Knaggs faces up to 20 years in prison, five years of supervised release and a $250,000 fine.
United States Attorney Carmen M. Ortiz; John G. Collins, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Kevin Niland, Postal Inspector in Charge of the U.S. Postal Inspection Service; and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Karen Goodwin of Ortiz’s Springfield Branch Unit.
The details contained in the Indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
South Windsor Man Pleads Guilty to Stealing High-powered Rifle from East Windsor Gun StoreRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that JORDAN MARSH, 27, of South Windsor, waived his right to indictment and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to one count of theft of a firearm from a federally licensed firearms dealer.
According to court documents and statements made in court, on December 11, 2012, MARSH stole a Windham Weaponry 5.56 mm caliber semi-automatic rifle from the front counter of Riverview Gun Sales, a former federal firearms dealer located in East Windsor. The theft was captured on the store’s video surveillance system, but no employee at Riverview observed the theft or realized the firearm was missing until the Hartford Police retrieved it from MARSH’s hotel room on December 17. On December 15, 2012, MARSH had been arrested for attempting to steal a Bushmaster .50 caliber rifle from Riverview.
Earlier in 2012, MARSH was convicted of a state felony stemming from his prior thefts of approximately 12 firearms from Riverview.
Judge Shea has scheduled sentencing for December 17, 2013, at which time MARSH faces a maximum term of imprisonment of 10 years.
On August 27, 2013, MARSH pleaded guilty in state court to firearms and probation violation offenses stemming from his attempted theft of the Bushmaster .50 caliber rifle, and was sentenced to eight years of incarceration. He is currently detained in state custody.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Hartford and East Windsor Police Departments. The case is being prosecuted by Assistant United States Attorney Robert M. Spector.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Sioux Falls Man Sentenced for Mail FraudRead the Press Release
United States Attorney Brendan V. Johnson announced that a Sioux Falls, South Dakota, man charged with Mail Fraud was sentenced on September 23, 2013, by U.S. District Judge Karen E. Schreier.
Steven Isaacson, age 50, was sentenced to 4 years of probation and ordered to make restitution of $106,609.03.
Isaacson was indicted for 22 counts of mail fraud by a federal grand jury on April 2, 2013. He pled guilty to one count on June 26, 2013, and the remaining counts were dismissed.
Between January 2006 and July 2011, Isaacson was employed as an officer for AAA Collection Company and Metronova in Sioux Falls and was responsible for paying the company bills. During that timeframe, he mailed payments for his personal expenses and credit card bills using company funds.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Connie Larson prosecuted the case.Seminole Man Found Guilty of Possession and Distribution of Child PornographyRead the Press Release
Tampa, FL - Acting United States Attorney A. Lee Bentley, III announces that Michael Meister (57, Seminole) was found guilty yesterday of possession and distribution of child pornography following a bench trial. Meister faces a maximum penalty of 40 years in federal prison. His sentencing hearing is scheduled for December 19, 2013, at 9:30 a.m. Meister was indicted on August 11, 2011.
According to the facts presented at trial, on July 30, 2007, Meister took his Dell laptop to a computer repair shop in Pinellas County and requested that certain files be moved from his old laptop onto a new laptop computer that he had recently purchased. While the computer technician was transferring files, he viewed what he believed to be child pornography and called law enforcement. Law enforcement obtained a search warrant and performed a search of the computer. A forensic analysis of the computer hard drive revealed that Meister knowingly possessed and distributed child pornography.
This case was investigated by the Florida Department of Law Enforcement in conjunction with their work on the U.S. Immigration and Custom Enforcement's (ICE) Homeland Security Investigations (HSI) Child Exploitation Task Force. It is being prosecuted by Assistant United States Attorney Amanda C. Kaiser.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Schuyler County Man Sentenced on Drug Trafficking and Firearms ChargesRead the Press Release
ROCHESTER, N.Y.– U.S. Attorney William J. Hochul, Jr. announced today that John Anthony Barton, 33, of Dix, N.Y., was sentenced to 180 months in prison by U.S. District Judge Charles J. Siragusa. Barton was convicted following a jury trial of conspiracy to manufacture 500 grams or more of methamphetamine, possession with intent to distribute 500 grams of more of methamphetamine, possession of marijuana with intent to distribute, using his residence to manufacture, distribute and use methamphetamine and marijuana, and possession of firearms in furtherance of drug trafficking crimes.
Assistant U.S. Attorneys Jennifer Noto and Charles E. Moynihan, who handled the prosecution of the case, stated that Barton was arrested on May 18, 2011, after members of the New York State Police, Schuyler County Sheriff’s Office, Schuyler County District Attorney’s Office, Village of Watkins Glen Police Department and the Drug Enforcement Administration executed a search warrant at Barton’s residence on Roloson Hollow Road in Dix. During the search, law enforcement officers discovered an active methamphetamine laboratory, which was in the process of producing methamphetamine, in a shed on the property. In the shed, law enforcement officers also recovered a total of eight firearms, including a loaded .45 caliber handgun, more than 30 grams of methamphetamine, and over $8,000 in cash. Officers also recovered approximately a pound of marijuana from the house located on the property. Testimony at the trial, which occurred in June of this year, also revealed that Barton, together with others, manufactured methamphetamine and distributed as much as 900 grams between 2009 and May 18, 2011.
“Methamphetamine is a dangerous and addictive drug that even in small doses can cause permanent harm to those who use it,” said U.S. Attorney Hochul. “Besides causing lasting brain damage, this substance has been known to cause facial disfigurement and other serious physical maladies. Beyond what the drug does to the user, those who make methamphetamine create an environmental hazard for the entire community by the toxic substances used in the production process. This sentence is therefore completely appropriate given the entire facts of this case.”
At the time of Barton’s arrest, two others – Shawn Rickard and Chad Speicher – were also arrested. Rickard pleaded guilty to narcotics conspiracy involving 500 grams or more of methamphetamine and possession of firearms in furtherance of a drug trafficking crime and was sentenced to eight years in prison. Speicher pleaded guilty to narcotics conspiracy and is awaiting sentencing.
The sentencing is the culmination of an investigation on the part of the Schuyler County District Attorney’s Office, under the direction of District Attorney Joseph Fazzary, Special Agents of the Drug Enforcement Administration, under the direction of Timothy Kernan, Resident Agent in Charge, New York State Police Community Narcotics Enforcement Team (CNET) under the direction of Major Wayne C. Olson, the Schuyler County Sheriff’s Department, under the direction of Sheriff William Yessman, and the Watkins Glen Police Department, under the direction of Chief Thomas R. Struble.Saddle River Valley Bank Agrees to $8.2 Million Penalty for Money Laundering ViolationsRead the Press Release
NEWARK, N.J. – Saddle River Valley Bank (SRVB) today agreed to pay an $8.2 million penalty to settle claims that it violated federal anti-money laundering laws, U.S. Attorney Paul J. Fishman, District of New Jersey; Department of the Treasury Financial Crime Enforcement Network Director Jennifer Shasky Calvery; and Comptroller of the Currency Thomas J. Curry announced.
SRVB agreed to resolve civil claims brought by the U.S. Department of Justice in connection with violations of the Bank Secrecy Act (BSA), which requires financial institutions to maintain programs designed to detect and report suspicious activity that might be indicative of money laundering and other financial crimes. In addition to the combined monetary penalty of $8.2 million, the bank has agreed to a number of related regulatory actions.
The complaint alleged that SRVB failed to maintain an effective anti-money laundering program and processed transactions involving at least $4.1 million in violation of federal money laundering laws. While a joint investigation by the U.S. Attorney’s Office and the Office of the Comptroller of the Currency (OCC) was underway, the majority of the assets of SRVB were acquired by another financial institution. The proceeds of that acquisition, plus all other assets of the bank, which are currently valued at approximately $9.2 million, were held pending the outcome of the investigation. SRVB has agreed to settle the government’s allegations with a combined penalty of $8.2 million of the remaining $9.2 million and has separately agreed with the OCC to cease operation and to dissolve its charter.
According to the complaint:
Beginning at least as early as 2000, numerous federal agencies, including the Department of State, the Department of the Treasury, the Federal Reserve Bank, and the IRS, began issuing public warnings to United States financial institutions about the increased money laundering threat present in Mexico. These warnings were also available through industry-wide advisories. It was believed that the proceeds of narcotics sales in the United States were being disproportionately laundered and transferred through banking institutions in Mexico. Many of these warnings also discussed the specific money laundering risks associated with “casas de cambio,” (CDCs), which are non-bank currency exchange businesses located in Mexico and elsewhere.
Beginning in June 2009, SRVB began servicing what would ultimately become four CDCs, including three CDCs in Mexico and one in the Dominican Republic. SRVB voluntarily severed its relationship with the CDCs by May 2011, but only after processing at least $1.5 billion in transactions on behalf of the CDCs. SRVB’s anti-money laundering program related to the CDCs was deficient in several key areas
SRVB failed to:
• appropriately monitor at least $1.5 billion in transactions conducted on behalf of the CDCs;
• properly detect and report suspicious activity occurring within the CDC accounts and file Suspicious Activity Reports on a timely basis;
• conduct sufficient enhanced due diligence on the CDCs;
• have a BSA officer or other personnel with sufficient experience to operate an AML program;
• provide adequate training to its employees concerning anti-money laundering;
• retain qualified periodic independent testers for its anti-money laundering program, as required by the BSA.
After a joint investigation by the U.S. Attorney’s Office for the District of New Jersey and the OCC, SRVB agreed to an assessed civil monetary penalty by the OCC of $4. 1 million for the deficiencies in its anti-money laundering program. SRVB has agreed to a concurrent civil monetary penalty by FinCEN of $4.1 million, to be satisfied by one payment to the U.S. Treasury Department on behalf of both actions by the OCC and FinCEN. SRVB also agreed to surrender and forfeit an additional $4.1 million to the United States to resolve the investigation conducted by the U.S. Attorney’s Office for the District of New Jersey and the OCC, for a total penalty of $8.2 million.
U.S. Attorney Fishman credited special agents from the Department of Homeland Security, Homeland Security Investigations and thanked Counsel Elizabeth Ratliff and Noelle Kurtin of the OCC, as well as former Trial Attorney Joseph Markel of the Department of Justice, Asset Forfeiture and Money Laundering Section.This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
The government is represented by Assistant U.S. Attorneys Evan S. Weitz of the Asset Forfeiture and Money Laundering Unit and Aaron Mendelsohn of the Economic Crimes Unit of the U.S. Attorney’s Office in Newark.
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Defense counsel: Nicolas Bourtin Esq., New York
SRVB Settlement
SRVB ComplaintReal Estate Agent and Developer/loan Officer Both Sentenced to Prison for Mortgage FraudRead the Press Release
TUCSON, Ariz. – William Michael Naponelli, 69, and Bryan Atwood, 52, both from Tucson, Ariz., were sentenced to federal prison by U.S. District Court Judge Cindy K. Jorgenson for their role in a mortgage fraud scheme. Naponelli was sentenced to 24 months in prison on Sept. 23, 2013. Attwood was sentenced to 15 months in prison on Sept. 20, 2013. Naponelli previously pleaded guilty to the felony offenses of conspiracy to commit bank fraud and conspiracy to commit transactional money laundering on Dec. 20, 2012. Atwood previously pleaded guilty on Feb. 25, 2013, to conspiracy to commit wire fraud, also a felony.
As part of his guilty plea, Naponelli, a former real estate developer and loan officer, admitted his participation in a scheme to obtain various loans between July 2006 and May 2007. Naponelli and another co-conspirator real estate developer purchased several properties using various business entities with which they were associated. Thereafter, Naponelli and his fellow co-conspirator sold these properties to straw buyers.
As part of the loan approval process, Naponelli knowingly caused to be submitted documents with knowledge that they contained material false statements including representations that the borrowers would provide the down payment or cash to close the real estate transactions. After the fraudulently obtained loan proceeds were received, portions of these proceeds were wired or deposited into bank accounts controlled by Naponelli or another co-conspirator.
Atwood, who at the time of this conspiracy was a licensed real estate agent, admitted as part of his guilty plea that he obtained three properties through fraudulently obtained loans. He admitted that he knew that documents provided to the lenders on his behalf relating to these properties contained one or more material false representations.
The properties obtained as result of this mortgage fraud scheme went into foreclosure resulting in significant losses to the lenders. As part of Naponelli’s sentence, he was ordered to pay restitution totaling approximately $3.1 million dollars. Atwood was ordered to pay approximately $585,000.
Naponelli and Atwood are the third and fourth co-defendants to be sentenced in this case. Previously, co-defendants Walter Scott Fruit and Sandra Jackson were each sentenced to federal prison for their involvement in the conspiracy. Fruit, who was also a licensed real estate agent, received a 30 month prison sentence. Jackson, a former escrow agent, received six months in prison.
The investigation in this case was conducted by the Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation. The prosecution was handled by Jonathan B. Granoff, Assistant U.S. Attorney, District of Arizona, Tucson.
CASE NUMBER: CR-11-3046-TUC-CKJ
RELEASE NUMBER: 2013-077_Naponelli_AtwoodFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
Prince George’s County Heroin Dealer Sentenced to 12 Years in Prison on Drug and Gun ChargesRead the Press Release
Greenbelt, Maryland - U.S. District Judge Alexander Williams, Jr. sentenced Jerry Lamont Bush, age 35, of Fort Washington, Maryland, today to 12 years in prison, followed by five years of supervised release, for conspiracy to distribute heroin and possession of a firearm by a convicted felon.The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; and Chief Mark A. Magaw of the Prince George’s County Police Department.
Bush admitted that from August 2008 through January 2009, he sold approximately 180 grams of heroin to individuals in Maryland. He was detained by law enforcement on January 30, 2009, after he was seen selling heroin. On four occasions between July 30 and September 11, 2009, Bush sold a total of 14 grams of heroin to a law enforcement confidential source.
On September 19, 2009, law enforcement patrolling in the vicinity of a nightclub in Temple Hills, Maryland, observed the butt-end of a gun protruding from underneath the driver’s seat of a vehicle that Bush had been seen operating. Members of law enforcement saw Bush approach the vehicle and use a remote key to unlock the car. Bush got into the front passenger seat and another individual got into the driver’s seat. Law enforcement detained Bush and the other individual and searched the car. A loaded .357 caliber revolver was recovered from under the driver’s seat and a .9mm pistol was found in the glove compartment. On October 14, 2009, Bush was arrested by law enforcement as he left his apartment. During a search of Bush following his arrest law enforcement recovered two baggies containing 5.6 grams of heroin from his mouth. A search of Bush’s apartment recovered approximately 55.6 grams of heroin, among other items.
Bush had two previous felony drug convictions and was prohibited from possessing a gun.
United States Attorney Rod J. Rosenstein commended the ATF and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Arun Rao, Mara Zusman Greenberg and Deborah A. Johnston, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Philadelphia Pair Charged with Transporting Stolen JewelryRead the Press Release
Jerome Clinton Faison, 45, and David Thomas Jr., 49, both of Philadelphia, Pennsylvania, were charged today by indictment with interstate transportation of stolen goods, announced United States Attorney Zane David Memeger. The indictment charges that on December 27, 2012, Faison and Thomas unlawfully transported in interstate commerce approximately $100,000 of stolen jewelry from Ogden, Utah to Philadelphia, Pennsylvania.
If convicted, each defendant faces a maximum sentence of 10 years in prison, a fine of up to $250,000, three years of supervised, and a $100 special assessment.This case has been investigated by the Federal Bureau of Investigation, the Philadelphia Police Department, and the Ogden Police Department. The case is being prosecuted by Assistant United States Attorney Thomas M. Zaleski.
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, 215-861-8525Philadelphia Man Charged with Attempted Bank RobberyRead the Press Release
Dean Ceraolo, 51, of Philadelphia, PA, was charged today by Indictment on charges that he committed an attempted bank robbery at Citizens Bank, 1970 Red Lion Road, Philadelphia, on September 3, 2013, announced United States Attorney Zane David Memeger.
If convicted the defendant faces a maximum possible sentence of 20 years in prison, a $250,000 fine, and $100 in special assessments.
The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department and is being prosecuted by Assistant United States Attorney Arlene Fisk.
Click here to view the indictment
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Permanent Resident Charged in Viagrar and Cialisr CaseRead the Press Release
HOUSTON – Mohammad Jamal Rashid, 45, a legal permanent resident from Pakistan residing in Houston, has been arrested following the return of a seven-count indictment involving counterfeit Viagra® and Cialis® products, announced United States Attorney Kenneth Magidson and Special Agent in Charge Patrick J. Holland of the Food and Drug Administration – Office of Criminal Investigations (FDA-OCI) Kansas City Field Office.
The indictment, returned Sept, 12, 2013, was unsealed today upon his arrest. Rashid made his initial appearance this afternoon before U.S. Magistrate Judge Stephen Wm. Smith at which time he was permitted release upon posting bond.
“Today’s arrest demonstrates the continued commitment by the FDA-OCI and its law enforcement partners to aggressively pursue those allegedly involved in the sale of counterfeit pharmaceuticals,” said Holland. “Those ultimately convicted of such crimes are often motivated by greed and prey upon an unsuspecting public with no regard for public safety.”
The indictment charges Rashid with conspiracy, trafficking in counterfeit and misbranded Viagra® and Cialis® pills, introducing misbranded drugs into interstate commerce and smuggling.
Rashid allegedly conspired with others to import counterfeit and misbranded Viagra® and counterfeit and misbranded Cialis® to his home in Houston. The indictment alleges Rashid received a package containing approximately 3,200 counterfeit Viagra® and approximately 4,000 counterfeit Cialis® drugs. According to the indictment, Rashid accepted delivery and took possession of a package containing the counterfeit drugs which were addressed to Rashid’s home, under another person’s name on Jan. 26, 2012. The indictment further alleges Rashid delivered a package of counterfeit drugs to another individual on that same day.
The possible punishment for a conviction of trafficking in counterfeit goods is up to 10 years in prison and a fine of not more than $2 million. He further faces up to 20 years in prison and a $250,000 fine if convicted of smuggling as well as another five years and $250,000 fine for the conspiracy, upon conviction. For introducing misbranded drugs into interstate commerce, the possible punishment is up to three years in prison and a $10,000 fine.
The investigation was conducted by Homeland Security Investigations and the FDA-OCI. Assistant United States Attorney Julie Redlinger is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Pasco County Pharmacist Sentenced for Illegally Distributing Pain MedicationsRead the Press Release
Tampa, Florida - United States District Judge Susan Bucklew today sentenced Edward Benjamin Alister Beckles (59, Pasco County) to 4 years in federal prison for distributing Oxycodone. He was also ordered to serve a two-year term of supervised release. As part of his sentence, the court also entered a money judgment in the amount of $175,000, the proceeds of the charged criminal conduct. Beckles pleaded guilty on March 26, 2013.
According to court documents, in 2010, detectives from the Pasco County Sheriff’s Office and agents with the Drug Enforcement Administration began an investigation to identify members of a large Oxycodone pill distribution ring. As a result of the investigation, 33 individuals were arrested and prosecuted.
From August 2009 through January 2012, individuals presented fraudulent prescriptions for Oxycodone to Beckles at his pharmacy and he filled the prescriptions, knowing they were fraudulent. Beckles was a licensed pharmacist and the owner of Ed’s Family Friendly Pharmacy in New Port Richey. During the investigation, Beckles provided federal agents with a computer printout that showed the pharmacy made in excess of $130,000 in a 45-day period from the illegal sale of Oxycodone. According to this document, Beckles filled approximately 210 fraudulent prescriptions in the 45-day period. Each prescription was for 270 pills.
This case was brought as part of the Pill Nation initiative and was investigated by the Drug Enforcement Administration and the Pasco County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Maria Chapa Lopez.
Panhandle Residents Arrested in Law Enforcement OperationRead the Press Release
Approximately $500,000 in Cash, Cocaine, Methamphetamine and Firearms Were Seized During Investigation
AMARILLO, Texas — A total of 14 individuals, residents of the Amarillo, Texas, and Panhandle area, are in custody following an Organized Crime Drug Enforcement Task Force (OCDETF) operation this morning led by special agents with the Drug Enforcement Administration (DEA) and the FBI, on conspiracy and drug trafficking charges outlined in two indictments returned by a federal grand jury earlier this month.
First Assistant U.S. Attorney John Parker, of the Northern District of Texas, Dan Salter, Special Agent in Charge of the DEA in Dallas, and Diego Rodriguez, Special Agent in Charge for the FBI Dallas Division, announced the results of the operation at a press conference held this afternoon in Amarillo, Texas. Mr. Parker represented U.S. Attorney Sarah R. Saldaña who was not able to attend.
“Targeting drug cartels that have infiltrated the Panhandle area and jeopardized the safety and security of our communities will continue to be a priority in this district,” said First Assistant U.S. Attorney Parker. “Today I commend the dedicated efforts of the DEA and FBI, who led this OCDETF investigation, along with the ATF, the Potter and Randall County Sheriff’s Offices, the Potter and Randall County Attorney’s Offices, the Potter and Randall County District Attorney’s Offices, the Amarillo Police Department and the Texas Department of Public Safety.”
“Today, the DEA, along with our federal, state, and local partners, dealt a serious blow to the Gulf Cartel, a Mexican Drug Trafficking Organization, operating in the Texas Panhandle,” said Acting Special Agent in Charge Salter. “By combining efforts, this two-year investigation resulted in the federal indictment of 15 defendants determined to transport, distribute, and sell methamphetamine and cocaine throughout Amarillo and the surrounding communities. The DEA is committed to partner with federal, state, and local law enforcement to keep our citizens safe not only here in the Texas Panhandle but throughout the country. The DEA will continue to focus efforts to dismantle drug cartels determined to profit on the backs of addictions.”
“The cooperation and coordination amongst local, state and federal law enforcement resulted in the shared success of identifying the many participants of this criminal organization,” said Special Agent in Charge Rodriguez. “Today’s arrests reaffirm our commitment to the missions that we have each been charged to uphold.”
The following 11 defendants, who are charged in one indictment with conspiracy to distribute and possess with intent to distribute 500 grams or more of methamphetamine, were arrested this morning, and have made their initial appearance before U.S. Magistrate Judge Clinton E. Averitte.
• Omar Mendoza, a/k/a “Big O” and “O,” 36
• Sammy Augustin Galan, a/k/a “Hondu,” 36
• Miguel Carrasco, 33
• Conrad Nava, a/k/a “Chauncy,” 36
• Bobby Holman, a/k/a “Holmes,” 37
• Floyd Daniel Teafatiller, 32
• Jessie Herrera, Jr., 34
• Joey Nicholas Vallejo, 35
• Traci Michelle Ramos, 23
• Curtis Gonzales, 35
• Shannon Drell Harris, a/k/a “Shawn,” 43
Five of these defendants are also charged with substantive felony drug offenses and one defendant, Vongphrachanh, is also charged with a firearms offense.
The two below-listed defendants, also charged in that indictment, are presently in state custody:
• Arcel Vega Martinez, a/k/a “Chilango,” 40
• Thiraphong Vongphrachanh, 22
In the second indictment, two individuals, Juan Gabriel Mejia, a/k/a “J,” 37, and Richard Anthony Rios, a/k/a “Tex,” 36, are charged with conspiracy to distribute and possess with intent to distribute 500 grams or more of methamphetamine. Rios, who was arrested earlier this month on a related criminal complaint, and remains in federal custody, is also charged in the indictment with three substantive methamphetamine offenses. His trial is set for October 22, 2013. Mejia remains a fugitive, believed to be in Mexico.
“Our local, state and federal law enforcement partners work every day to combat drug trafficking within Texas and beyond, and this proactive and successful operation will further enhance the safety of our communities,” said Randy Prince, Regional Commander of the Texas Department of Public Safety. “This multi-agency law enforcement effort has resulted in the arrest of multiple suspects, and it was a top priority for each agency involved to dismantle and render this drug trafficking organization ineffective in its constant pursuit to distribute narcotics throughout our communities. Working together as a team enables us to maximize our efforts and resources, and thanks to the dedication and coordination of the DPS Criminal Investigations Division agents and all participating law enforcement partners, this unified operation has removed these suspects from our communities.”
The investigation involved undercover purchases and search warrants. In total, throughout the investigation, approximately $500,000 in cash, 2.25 kilograms of cocaine, 1.75 pounds of methamphetamine and six firearms were seized.
A federal indictment is an accusation by a grand jury and a defendant is entitled to the presumption of innocence unless proven guilty. If convicted however, the statutory penalties for the conspiracy and substantive drug counts range from 40 years to life in federal prison and millions of dollars in fines. The maximum statutory sentence for the firearms offense charged is life in federal prison.
The case is being prosecuted by Assistant U.S. Attorney Jeffrey R. Haag.
(Download Factual Basis)
Panasonic Executive Indicted for Role in Fixing Prices on <br /> Automobile Parts Sold to Toyota to Be Installed in U.S. CarsRead the Press Release
A Detroit federal grand jury returned an indictment against a Panasonic Automotive Systems Corporation executive for his role in an international conspiracy to fix prices of switches and steering angle sensors sold to Toyota and installed in U.S. cars, the Department of Justice announced today.
The indictment, filed today in U.S. District Court for the Eastern District of Michigan, in Detroit, charges that Shinichi Kotani, a Japanese national, participated in a conspiracy to suppress and eliminate competition in the automotive parts industry by agreeing to rig bids for, and to fix, stabilize, and maintain the prices of, switches and steering angle sensors sold to Toyota Motor Corporation and Toyota Motor Engineering & Manufacturing North America Inc. for installation in vehicles manufactured and sold in the United States and elsewhere. Kotani is the Director of Global Automotive Marketing and Sales at Panasonic.
Panasonic is an Osaka, Japan-based manufacturer of automotive parts, including steering wheel switches, turn switches, wiper switches, combination switches, and steering angle sensors Panasonic pleaded guilty in August 2013, to its role in the conspiracy and was sentenced to pay a $45.8 million criminal fine.
The indictment alleges, among other things, that from at least as early as January 2004 until at least February 2010, Kotani and his co-conspirators attended meetings to reach collusive agreements to rig bids, allocate the supply and fix the prices of switches and steering angle sensors sold to Toyota. The indictment alleges that Kotani and his co-conspirators had further communications to monitor and enforce the collusive agreement.
“The Antitrust Division remains vigilant in its ongoing efforts to hold executives accountable when they engage in anticompetitive conduct that harms American consumers,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “As a result of the Antitrust Division’s ongoing investigation into bid rigging and price fixing in the auto parts industry, 19 executives have been charged.”
“I am proud of the hard work done by the FBI agents and the Department of Justice attorneys who worked on this case,” said John Robert Shoup, Acting Special Agent in Charge, FBI Detroit Division. “The global resources of the FBI are always ready to respond when these complex financial conspiracies threaten our national economy.”
Kotani is charged with price fixing in violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Including Kotani, 11 companies and 19 executives have been charged in the Justice Department’s ongoing investigation into the automotive parts industry. To date, more than $874 million in criminal fines have been imposed and 14 individuals have been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each. One other executive has agreed to serve time in prison and is scheduled to be sentenced on Sept. 25, 2013.
The charges are the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by each of the Antitrust Division’s criminal enforcement sections and the FBI. Today’s charges were brought by the Antitrust Division’s National Criminal Enforcement Section and the FBI’s Detroit Field Office, with the assistance of the FBI headquarters’ International Corruption Unit. Anyone with information on price fixing, bid rigging and other anticompetitive conduct related to other products in the automotive parts industry should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Detroit Field Office at 313-965-2323.Owner of Roofing Company Admits to Filing False Income Tax ReturnsRead the Press Release
TRENTON – The owner of Kenal Enterprises LLC admitted today to filing false income tax returns for several years, U.S. Attorney Paul J. Fishman, District of New Jersey, and Assistant Attorney General Kathryn Keneally of the U.S. Department of Justice, announced.
Kenneth Morton of Pitman, N.J., owner of Kenal (d/b/a Ken Morton Roofing and Siding), a residential roofing company located in Pitman, pleaded guilty before U.S. District Judge Mary L. Cooper in Trenton federal court an information charging him with filing false income tax returns for tax years 2007 through 2009.
According to documents filed in this case and statements made in court:
From early 2007 through late 2009, Morton cashed $3,946,046 of Kenal’s gross receipts at a check cashing agency, the majority of which he did not deposit into his business bank account and did not report on his individual income tax returns. For the 2007, 2008, and 2009 tax years, Morton had unreported gross receipts of $1,343,348; $1,471,430; and $1,131,268, respectively, causing a loss to the IRS of $241,412.
Morton faces a maximum potential penalty of three years in prison and a fine of $250,000, along with restitution to the IRS. Sentencing is scheduled for Jan. 6, 2014.
Assistant Attorney General Keneally and U.S. Attorney Fishman credited special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s guilty plea.
The government is represented by Trial Attorneys Jessica Moran and Tino Lisella of the Justice Department’s Tax Division. Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
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Defense counsel: Robert H. Williams Esq., Haddonfield, N.J.
Morton, Kenneth Information
Operation ‘Smokin’ Aces’ Targets Mexican Mafia Operations in Orange CountyRead the Press Release
Federal and State Grand Juries Indict 129 Defendants who Allegedly Assisted the Prison Gang or Were Involved in the Business of Numerous O.C. Street Gangs
SANTA ANA, California – Hundreds of law enforcement officials this morning fanned out across Southern California to conclude Operation “Smokin’ Aces,” an investigation conducted by the Santa Ana Gang Task Force that targeted the Orange County wing of the Mexican Mafia, which allegedly exercises control over Latino street gangs and is a powerful force in the local jail system.
A total of 129 defendants have been named in indictments issued by county and federal grand juries. Each of the defendants is linked to an Orange County street gang that claims allegiance to the Mexican Mafia, which is also called the Eme. Some of the federal defendants also are associates of the prison gang who allegedly worked directly with one of the two Mexican Mafia members who oversee the Orange County wing of the criminal enterprise.
During the course of the investigation, task force members made undercover purchases of 67 weapons (38 handguns and 29 rifles). They also seized 22 pounds of methamphetamine, 1.5 pounds of heroin and three pounds of cocaine.
Over the past three months, a federal grand jury in Orange County has returned 26 indictments that charge a total of 86 defendants. The indictments allege a wide range of criminal conduct, including murder and assault, extortion and “tax” collection, and the street-level distribution of narcotics.
As part of Smokin’ Aces, the Orange County District Attorney has also obtained indictments that charge a total of 43 defendants.
At the center of Smokin’ Aces is a federal racketeering indictment that focuses on the operations of the Mexican Mafia in Orange County, a criminal organization that for many years has been headed by Peter Ojeda, who allegedly ordered murders and assaults on behalf of the Mexican Mafia. (Ojeda is not formally charged in the indictment unsealed today, but he is currently pending trial in another racketeering case that was filed in 2011 in relation to Operation “Black Flag.”)
The racketeering indictment alleges a conspiracy to violate RICO, the federal Racketeer Influenced and Corrupt Organizations Act. The RICO indictment unsealed today charges 26 defendants associated with the Orange County branch of the Mexican Mafia, including those who implemented orders given by Eme leaders, gang members who collected and delivered “tax payments,” and women associated with the organization who serve the “crucial” function of moving messages from incarcerated Mexican Mafia operatives to their minions on the streets.
The Mexican Mafia is a powerful and violent prison gang that controls drug distribution and other illegal activities within the California penal system and on the streets of Southern California by organizing Latino street gang members for the purpose of establishing a larger network for the Mexican Mafia’s illegal activities. If a street gang does not comply with the demands of the Mexican Mafia, the prison gang will order the assault or murder the offending gang’s members, whether they are in custody or on the streets.
The majority of the federal indictments target gang members who allegedly trafficked in significant quantities of narcotics and firearms. Two of the indictments outline large drug trafficking conspiracies, one of which focuses on the Santa Ana-based Delhi gang. The gang members and their associates were paying “taxes” or “rent” to the Mexican Mafia, and this revenue stream fortified the control the Mexican Mafia has over members of gangs, whether they are on the street or in custody.
The first large drug distribution indictment charges 15 people and outlines the activities of an organization allegedly run by George “Monk” Martinez and John Terrones, who are alleged leaders of the Santa Ana-based Delhi gang and who are also named in the RICO indictment. The narcotics indictment alleges a conspiracy to distribute methamphetamine and heroin.
The second narcotics trafficking indictment charges a dozen individuals with participating in a methamphetamine distribution organization headed by Mario Franco, a member of a Santa Ana-based gang who also is named in the RICO indictment.
Operation Smoking Aces is the latest action by the Santa Ana Gang Task Force to target the Mexican Mafia and its control over Latino street gangs in Orange County. In July 2011, authorities announced Operation “Black Flag,” which led to charges against 99 defendants, including Peter Ojeda (see: http://www.fbi.gov/losangeles/press-releases/2011/ninety-nine-members-and-associates-of-mexican-mafia-affiliated-gangs-charged-in-operation-black-flag).
Smokin’ Aces was an investigation conducted by the Santa Ana Gang Task Force, which is comprised of agents and officers with the Federal Bureau of Investigation; the Santa Ana Police Department; the Orange County Sheriff’s Department; the Bureau of Alcohol, Tobacco and Firearms and Explosives; and the California Department of Corrections and Rehabilitation – Special Service Unit. Special Agents with IRS – Criminal Investigation also participated in Operation Smoking Aces.
Multiple agencies assisted during today’s operation, including personnel with the United States Marshals Service; the Anaheim Police Department; the Newport Beach Police Department; the Fountain Valley Police Department; the Huntington Beach Police Department; the Brea Police Department; the Irvine Police Department; the Buena Park Police Department; and the Garden Grove Police Department.
Release No. 13-118
Opelousas Man Pleads Guilty to Part in Aggravated Robbery at Lawtell Post OfficeRead the Press Release
LAFAYETTE, La. – United States Attorney Stephanie A. Finley announced today that Willie Jamal Reynolds, 33, of Opelousas, La., pleaded guilty before U.S. District Magistrate Judge C. Michael Hill to taking part in the robbery at the U.S. Post Office in Lawtell, La., where a driver was attacked.
According to evidence presented at the guilty plea, two individuals robbed a U.S. Postal Service highway contract route driver on Aug. 13, 2011, while the driver was with his truck at the loading dock of the post office in Lawtell. One of the individuals grabbed the driver from behind by the neck and wrestled him to his knees. The other individual demanded money, but the driver said there was none, just mail. The driver noticed the individual who spoke had a gun and took a registry bag. They eventually left, and the driver was transported to a nearby hospital where he was treated for injuries. Several witnesses reported seeing a white van in the area, and a surveillance camera at a business located next door to the post office shows a white van drop off two individuals at the time of the robbery. Reynolds admits he used his mother’s white van to pick up the two assailants and transport them to and from the post office.
Reynolds faces up to 25 years in prison, five years of supervised release, and a $250,000 fine for aggravated robbery of mail matter. Sentencing was set for Feb. 14, 2014.
The U.S. Postal Inspection Service and the St. Landry Parish Sheriff’s Office conducted the investigation. Assistant U.S. Attorney Brett L. Grayson is prosecuting the case.
Newburgh Latin Kings Leader Jose Lagos Sentenced to 40 Years in Prison for Three MurdersRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JOSE LAGOS, a leader of the Latin Kings gang in Newburgh, New York (the “Newburgh Latin Kings”), was sentenced today by U.S. District Judge Cathy Seibel in White Plains federal court to 40 years in prison. LAGOS’s criminal conduct, for which he was sentenced, included three murders, shootings, brandishing firearms, assaults, drug distribution, and other acts of racketeering. LAGOS, 23, is one of 35 members and associates of the gang who were charged in the case, all of whom have been convicted, 26 of whom have been sentenced. The remaining top two leaders of the gang, Wilson Pagan and Christian Sanchez, were convicted at trial of murder, racketeering, firearms, and narcotics offenses, and each faces a mandatory life sentence.
U.S. Attorney Preet Bharara stated: “With this sentencing, and the pending sentencing of Lagos’s two key accomplices, the leadership of the gang that deprived the citizens of Newburgh of their well-being has been decapitated. This result was only accomplished by the unflagging efforts of the federal, state and local law enforcement personnel and the prosecution team. Today, Newburgh is a safer place but we are not relenting in our efforts to lift the shadow that gangs cast over its streets.”
According to the Indictment to which LAGOS pled guilty, statements made during the plea and sentencing proceedings, other court documents, and evidence presented during related trials:
On May 6, 2008, LAGOS, then a leader of the Newburgh Latin Kings, ordered two others to shoot a member of a rival gang, the Bloods. The subordinates followed LAGOS’s orders, but mistakenly shot and killed Jeffrey Zachary, a 15-year-old boy, who had nothing to do with the gang dispute.
On March 11, 2010, LAGOS, then still a leader of the Newburgh Latin Kings, ordered, along with others, two others to shoot a member of the Bloods. The subordinates followed LAGOS’s and the other leaders’ orders, but one of the subordinates, Jerome Scarlett, was instead mistakenly shot and killed.
On March 12, 2010, LAGOS, along with other leaders of the Newburgh Latin Kings, ordered the killing of John Maldonado, whom they suspected had killed Scarlett. LAGOS helped to obtain a gun while other members of the gang plotted the murder. Another member of the gang shot Maldonado, unsuspecting, in the back, killing him.
LAGOS carried out the murders as part of his participation in the criminal affairs of the Newburgh Latin Kings. Among the gang’s criminal objectives was selling drugs, including by controlling corners in the City of Newburgh where they regularly met with drug customers to sell crack, cocaine, heroin, and marijuana. Gang members, and leaders such as LAGOS, conspired together to protect their drug turf, and to attempt to expand the gang’s drug turf, including by using violence to kill, hurt, or intimidate the gang’s rivals or other enemies of the gang.
Mr. Bharara thanked the Hudson Valley Safe Streets Task Force for their work on the Latin Kings investigation. The Task Force is led by the Federal Bureau of Investigation (“FBI”), and combines the resources of dozens of law enforcement officers from federal, state, and local agencies and departments, including: agents and officers of the FBI; the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives; the City of Newburgh Police Department; the U.S. Department of Homeland Security, Homeland Security Investigations; the Middletown Police Department, the Orange County Sheriff’s Office; and the New York State Police.
The prosecution is being handled by the Office’s White Plains Division. Assistant U.S. Attorneys Benjamin Allee, Abigail S. Kurland and Nicholas McQuaid are in charge of the prosecution.
New London, WI Sentenced in Federal Court for Social Security FraudRead the Press Release
United States Attorney James L. Santelle, of the Eastern District of Wisconsin, announced that on September 23, 2013, James Allen Mereness (age: 57) of New London, Wisconsin was sentenced to 10 months in a federal prison by Chief United States District Judge William C. Griesbach. Mereness had previously pled guilty to a single count of Social Security Fraud.
According to the plea agreement and other documents filed with the court, Mereness applied for social security disability payments for his child, falsely stating that the child resided with him and that he, Mereness, was responsible for the day-to-day support of the child. In fact, the child continuously resided with his mother and had little to no contact with Mereness. Mereness continued to falsely accept payments for a period of 36 months, converting the funds for his personal use including the purchase of a new vehicle. None of the funds received were ever used for the benefit or support of the child.
In addition to the above term of imprisonment, Mereness was ordered to serve three years of supervised release. As one of the conditions of that release, he was ordered to pay restitution to the Social Security Administration in the amount of $39,866.
In sentencing the defendant, Judge Griesbach noted the serious and extended nature of the theft, as well as the need to deter others in the community from fraudulently receiving taxpayer funds intended for those truly in need of assistance.
The case was investigated by special agents from the Social Security Administration. It was prosecuted by Assistant United States Attorney Daniel R. Humble.
New Jersey Lawyer Sentenced in Manhattan Federal Court in Connection with Multiple Investment Fraud SchemesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that EVERETTE L. SCOTT, JR., a New Jersey attorney, was sentenced today in Manhattan federal court to 30 months in prison for engaging in securities and wire fraud in connection with two separate schemes. In the larger of the two schemes, SCOTT and co-defendant Tyrone L. Gilliams, Jr., solicited and misappropriated $5 million in investments in a bogus U.S. Treasury Strips investment program. In the other scheme, the defendants solicited and misappropriated a $450,000 investment in a Utah coal mine. In addition to buying luxury cars, jewelry, and other items, Gilliams spent hundreds of thousands of dollars of investor money organizing and promoting a multi-day festival in Philadelphia that headlined Sean “Diddy” Combs. SCOTT and Gilliams were found guilty following a jury trial in February 2013, and Scott was sentenced today by U.S. District Judge Deborah A. Batts.
Manhattan U.S. Attorney Preet Bharara said: “With his sentence today, Everette Scott meets the just punishment that befalls an attorney who uses a law license as a vehicle for fraud – time in federal prison. This Office will continue to make sure the perpetrators of fraud are brought to justice and pay the price for their crimes.”
According to the Indictment and the evidence presented at trial:
In 2009 and 2010, Gilliams was the owner of TL Gilliams, LLC, which purported to engage in transactions in commodities like oil and gold. SCOTT was an attorney at a small law firm in New Jersey and acted as TL Gilliams’s general counsel.
In the summer of 2010, Gilliams solicited $5 million dollars from two investors for purposes of trading in U.S. Treasury Strips, which are a derivative of U.S. Treasury Bonds. Gilliams and SCOTT arranged for the investors to make their investments by wiring them into an attorney trust account maintained by SCOTT’s law firm. Upon receiving the money, SCOTT – at Gilliams’s direction – misappropriated more than $700,000 to satisfy expenses stemming from an unrelated and failed venture to buy a coal mine in Utah. SCOTT also claimed $50,000 of the investment money for himself as purported fees. At Gilliams’s direction, SCOTT transferred most of the remainder to bank and brokerage accounts that Gilliams controlled.
At most, Gilliams purchased $250,000 worth of Treasury Strips with the more than $4 million in investment money transferred by SCOTT. Over a span of less than six months, Gilliams spent more than $1.6 million on an unrelated gold investment; more than $200,000 to purchase a commercial warehouse in Denver; at least $100,000 to buy or lease luxury cars; at least $50,000 for construction work on his home; at least $100,000 on luxury hotel and travel expenses; and more than $500,000 promoting two events – “Joy to the World,” involving an album release party with Jamie Foxx at the Vault nightclub in Philadelphia, and culminating in a red carpet, black tie gala at the Philadelphia Ritz-Carlton, headlined for a $120,000 fee by Sean “Diddy” Combs, and the “Gatta Be Jokin’ Comedy Jam,” a December 2010 comedy performance in Nassau, Bahamas.
Gilliams did not engage in any trading of Treasury Strips and, as a result, did not derive any profits. Nonetheless, during the period when he was spending investor money, Gilliams provided investors with false reports of trades and profits, and made occasional, nominal payments that he falsely claimed represented profits from Treasury Strips trading. Other than these purported profit payments, which totaled approximately $100,000, neither investor received any of his combined $5 million investment back.
In a separate scheme, Gilliams and SCOTT arranged in late 2009 for an investor to transfer $450,000 to SCOTT’s attorney trust account, to be held in escrow until used in connection with a venture to purchase the assets of a bankrupt Utah coal mine. Once the money was in SCOTT’s account, he secretly misappropriated approximately $112,000 by claiming it as purported fees, and transferred the rest to Gilliams or other individuals and entities at Gilliams’s direction. Until August 2010, Gilliams and SCOTT falsely assured the victim that his $450,000 remained safely in escrow, long after SCOTT’s escrow account had been emptied. Although the victim repeatedly demanded the return of his funds, Gilliams and SCOTT pacified him by producing forged bank documents and a false attorney attestation letter written by SCOTT purporting to show that Gilliams was in possession of the millions of dollars necessary to purchase and operate the Utah coal mine. In August 2010, after an attorney for the victim threatened SCOTT with professional discipline for his failure to return the escrowed funds, Gilliams and SCOTT paid the victim $450,000 using funds they raised for investment in Treasury Strips.
In addition to the prison term, Judge Batts sentenced SCOTT, 52, of Sewell, New Jersey, to three years of probation. He was also ordered to make restitution in the amount of $1,005,000, and pay a $300 special assessment fee.
Gilliams is scheduled to be sentenced by Judge Batts on October 31, 2013, at 10:30 a.m.
Mr. Bharara praised the work of the Criminal Investigators of the United States Attorney’s Office and the Federal Bureau of Investigation, which jointly investigated this case. He also thanked the U.S. Securities and Exchange Commission.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which U.S. Attorney Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Michael A. Levy and David B. Massey are in charge of the prosecution.
Nebraska Executive Sentenced to 21 Months in Prison for Federal Bribery Conspiracy with Former Chicago AldermanRead the Press Release
CHICAGO — The head of a large Nebraska-based prescription medication provider was sentenced today to 21 months in federal prison for conspiring with a former Chicago alderman and another man to commit bribery of a fictitious public official to purportedly obtain business from the Los Angeles County hospital system. The defendant, JAMES BARTA, 71, of Fremont, Neb., and two co-defendants were convicted of conspiracy to commit bribery following a twoweek trial in June in U.S. District Court.
Barta was also fined $125,000 and ordered to begin serving his sentence in early January by U.S. District Judge John J. Tharp, Jr. Co-defendants, AMBROSIO MEDRANO, 59, of Chicago, GUSTAVO BUENROSTRO, 50, of Arlington Heights, are scheduled to be sentenced, respectively, on Nov. 4 and Nov. 25.
“This offense involves bribery to influence governmental action,” Judge Tharp said, adding that Barta was a “paradigm of what a businessman should be, and yet . . . he readily agreed to pay a bribe to get a contract.” The judge noted a recording that was played at trial of Barta saying that he expected to pay a bribe and doing so was “business as usual.”
“It is not business as usual to bribe public officials,” Judge Tharp said, adding that this message “must be repeated to avoid the cynicism that overtook Mr. Barta.”
According to the evidence and court records, which included numerous audio and video recordings of conversations with the defendants, Medrano introduced an undercover FBI agent, who was posing as a purchasing agent, to Barta, the president of family-owned Sav-Rx, and Buenrostro, an associate of Barta and a former Sav-Rx employee. Barta, Buenrostro, and Medrano agreed to bribe the undercover agent and the fictitious Los Angeles County hospital official — with Barta handing a $6,500 check to the undercover agent at a restaurant in Omaha on June 22, 2012 — to do business with Sav-Rx, a Fremont, Neb.-based national provider of managed care prescription medication services.
Between December 2011 and March 2012, Medrano, Buenrostro, and a cooperating witness discussed the scheme, resulting in a meeting attended by those three, Barta, and the undercover agent at a Chicago restaurant on March 21. During the meeting, Barta discussed Sav-Rx’s business, including a contract with Cook County. The undercover agent explained a kickback arrangement for him and the fictitious Los Angeles County hospital official, if they were to succeed in expanding Sav-Rx’s services into the Los Angeles County hospital system. Barta replied that the arrangement was okay with him. In subsequent conversations, Medrano allegedly assured the cooperating witness and undercover agent that Barta and Buenrostro wanted to do a deal with the agent and were willing to provide an initial $10,000 payment in good faith.
The same group of individuals met again on May 9 at a Chicago restaurant and continued discussing steering Sav-Rx’s services to Los Angeles County, including using Medrano and Buenrostro to be the minority participants in a contract, with Barta endorsing that idea. Barta directed Buenrostro to do research on Los Angeles County and paid the lunch bill. The undercover agent said that the fictitious hospital official was not going to take any action until there was an agreement and the official saw some money. “We understand that and that’s not the problem,” Barta replied.
On June 22, 2012, Barta, Buenrostro, and Medrano met with the undercover agent at a restaurant in Omaha. The undercover agent explained that half of the good faith money they had been discussing was for his role in brokering the contract and half was for the fictitious Los Angeles County official. The undercover agent assured Barta that the good faith payment would be refunded if Sav-Rx did not obtain a contract from the hospital system. After further discussion about the indirect manner that Barta’s payment would be funneled to the fictitious official, Barta wrote a check on a Sav-Rx operations account, payable to the undercover agent for $6,500, and gave it to the undercover agent.
The sentence was announced today by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, and Robert J. Shields, Jr., Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The government was represented by Assistant U.S. Attorney Christopher J. Stetler.
Men Sentenced for Robbing Seven 7-ElevensRead the Press Release
NORFOLK, Va. – Ronald Randolph McKinney, 22, of Suffolk, Va., was sentenced on September 17, 2013 to 205 months in prison, followed by five years of supervised release, for brandishing, using and carrying a firearm during and in relation to a crime of violence and conspiracy to interfere with commerce by robbery. His co-conspirator, Anthony Deshaune Lewis, 20, of Portsmouth, Va., was sentenced today to 184 months in prison, followed by five years of supervised release, for brandishing, using and carrying a firearm during and in relation to a crime of violence and conspiracy to interfere with commerce by robbery. They were both ordered to pay restitution in the amount of $1,214.31, jointly and severally.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, and Royce E. Curtin, Special Agent in Charge of the Federal Bureau of Investigation’s Norfolk Field Office, made the announcement after sentencing by Chief United States District Judge Rebecca Beach Smith.
McKinney pleaded guilty on April 11, 2013 and Lewis pleaded guilty on April 9, 2013. According to court documents, on May 17-18, 2012, McKinney and Lewis robbed a total of seven 7-Eleven convenience stores in the cities of Norfolk, Chesapeake, Hampton and Newport News. McKinney and Lewis alternated roles during the spree. McKinney was the gunman during four robberies while Lewis drove the getaway car. Lewis was the gunman during three robberies in which McKinney drove the getaway vehicle. McKinney was positively identified by victims in the two Norfolk robberies he committed. Lewis was identified by the victims from one Hampton robbery and one in Newport News. Following his arrest and advice of Miranda, McKinney gave a full and detailed confession.
This case was investigated by the Federal Bureau of Investigation’s Norfolk Field Office and the Norfolk, Chesapeake, Hampton and Newport News Police Departments. Assistant United States Attorney Darryl J. Mitchell 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.Maurice Larry Sentenced to More Than 14 Years for Tax Fraud in Second Case in as Many DaysRead the Press Release
Tampa, FL - U.S. District Judge James S. Moody, Jr. today sentenced Maurice J. Larry to 14 ½ years in federal prison for wire fraud and aggravated identity theft charges stemming from his scheme to defraud the IRS with co-defendant, Rashia Wilson. The court also ordered Larry to forfeit $2,240,096.39, the traceable proceeds of the offense.He pleaded guilty on April 11, 2013. Larry will serve this sentence concurrently with his sentence from another unrelated tax fraud case. Judge Kovachevich sentenced Larry to 8 years and 5 months in prison yesterday for his involvement in the other tax fraud case. According to court documents, Larry and his co-conspirator, Rashia Wilson, engaged in a scheme to defraud the Internal Revenue Service by negotiating fraudulently obtained tax refunds. They did so by receiving U.S. Treasury checks and pre-paid debit cards that were loaded with proceeds derived from filing false and fraudulent federal income tax returns in other persons' names, without those persons’ permission or knowledge. Larry and Wilson filed these false and fraudulent federal income tax returns from multiple locations, including Wilson's residence and hotels in the Tampa area. Wilson, Larry, and others then used these fraudulently obtained tax refunds to make hundreds of thousands of dollars worth of retail purchases, to purchase money orders, and to withdraw cash.
During the course of the investigation, agents searched Wilson's residence and Larry's storage unit. They recovered thousands of names and social security numbers found in ledgers and various other records. Additional reloadable debit cards loaded with fraudulent tax refunds were also found in both locations.
The IRS estimates that the actual loss from Wilson and Larry's scheme is at least $3,147,477, and the intended loss is in excess of $11 million.IRS Criminal Investigation Special Agent in Charge James D. Robnett said, "Individuals who commit refund fraud and identity theft of this magnitude and with this degree of trickery, dishonesty and deceit, deserve to be punished to the fullest extent of the law. IRS Criminal Investigation, along with our Tampa Bay alliance partners and the United States Attorney's Office, remain vigilant in identifying, investigating and prosecuting those individuals who seek to willfully defraud the United States Treasury and blatantly disregard the victims of their schemes."
This case was investigated by the Internal Revenue Service - Criminal Investigation, the United States Secret Service, the United States Postal Inspection Service, the Tampa Police Department, and the Hillsborough County Sheriff's Office. It was prosecuted by Assistant United States Attorneys Sara C. Sweeney and Mandy Riedel.
Man Sentenced to 17½ Years in Prison in Phony Stem Cell CaseRead the Press Release
LAS VEGAS, Nev. – A man who conspired with a now-deceased Henderson pediatrician to take thousands of dollars from chronically ill patients for fraudulent stem cell implant procedures, was sentenced today to 17½ years in federal prison and ordered to pay approximately $1 million in restitution, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Alfred T. Sapse, 87, of Las Vegas, was sentenced by Senior U.S. District Judge Kent J. Dawson, and was immediately remanded to federal custody. Sapse was convicted by a jury in November 2012 of conspiracy to commit mail fraud and wire fraud, seven counts of mail fraud, and 11 counts of wire fraud. The co-defendant, Ralph M. Conti, M.D, of Henderson died several weeks following the conviction.
“Using purported medical practices and procedures to steal from vulnerable persons who are ill is disgusting and wrong,” said U.S. Attorney Bogden. “We will continue to use federal investigative and prosecutorial resources to ensure that persons who commit such crimes are held accountable and sent to prison.”
“Today’s sentence holds Mr. Sapse accountable for preying on patients who sought treatment for serious medical conditions, and demonstrates FDA’s commitment to protecting public health,” said Antoinette V. Henry, Special Agent in Charge, FDA Office of Criminal Investigations, Metro-Washington Field Office.
According to the superseding indictment and evidence introduced by the government at trial, from about January 2005 to current, Sapse, who purports to be a retired foreign physician but who has never been licensed to practice medicine in Nevada or any other state, convinced chronically ill patients to undergo experimental implant procedures and convinced investors to pay him large amounts of money without knowing the short- or long-term effects of the implant procedures he promoted. The procedures involved the implantation of portions of placental tissue into the abdomen of the patients for the treatment of their diseases. Sapse allegedly targeted extremely sick patients, by claiming that his “proprietary” procedure was especially effective for patients with multiple sclerosis, cerebral palsy and retinitis pigmentosa (a disease of the retina which can cause blindness.)
In the fall of 2005, Sapse hired Conti, a pediatrician in Henderson who had no prior stem cell training, to perform the procedures. At Sapse’sdirection, between approximately February 2006 and November 2006, Conti performed the implant procedure on approximately 34 patients in Las Vegas, knowing that it would not benefit the patients. During 2006, procedures performed by Dr. Conti resulted in the infection of at least two patients. In November 2006, the FDA sent Sapse and Conti a warning letter explaining that their procedure violated federal law, but after that date Conti performed at least one more implant and Sapse coordinated the implantation of a least two more patients.
Sapse and Conti made a number of misrepresentations to prospective patients and investors, including that the placental tissue used in the procedures was obtained only from Caesarian section births, so as to reduce the risk of passing infection, or otherwise to prevent “damage” to the placenta; that he had achieved “considerable success” with a procedure that was going to “revolutionize medicine as it is known today”; that wheelchair bound patients would “definitely walk again”; and that he subjected the placental tissue he obtained to a “proprietary process.”
Sapse failed to obtain any approvals from the FDA, as he knew he was required to do, prior to coordinating the implantation of placental cells in patients by Conti. Sapse and Conti made false representations to FDA regulatory investigators regarding their involvement in the scheme, conducted no meaningful follow-up with the patients who underwent the implant procedures, and concealed from patients and prospective patients the adverse effects suffered by previous patients.
In about February 2007, Sapse relocated his fraudulent scheme to Mexico and entered into an arrangement with a Mexican physician in Nuevo Progresso, Mexico, to perform his implant procedure. At Sapse’sdirection, the Mexican physician performed the implant procedure on approximately 100 patients between approximately February 2007 and May 2010 in Mexico.
Sapse received approximately $1 million from patients and investors, approximately $700,000 of which he spent on personal expenditures and for gambling at local casinos. Conti received in excess of $60,000 from the fraudulent procedures, all of which was in cash and none of which was reported on the accounting books of his medical practice. Sapse or Conti did not use any of the money for laboratory research, animal studies or human clinical studies relating to the short- and long-term effects of the implant procedures they were promoting.
This case was investigated by the FDA Office of Criminal Investigations and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz and First Assistant U.S. Attorney Steven W. Myhre.Lawton Woman Pleads Guilty to Large-Scale ATM TheftRead the Press Release
Oklahoma City, Oklahoma – Maria Estelle Martin, 47, of Lawton, pled guilty today to embezzling cash from a credit institution before United States District Court Judge Robin J. Cauthron, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
According to court records, Martin worked for a security company that serviced Lawton-area ATM machines for local banks and credit unions. Her duties included replenishing ATM machines with cash from financial institutions’ vaults. In late 2011 and early 2012, Martin embezzled cash by taking it from the vaults and keeping it rather than using it to replenish the ATM machines.
Martin faces up to 30 years in prison and a $1,000,000 fine at her January 7, 2014, sentencing hearing. She will also be required to pay $846,670 in restitution to the corporate victims of her theft.
This case was the result of an investigation conducted by the Federal Bureau of Investigation and the Lawton Police Department. The case was prosecuted by Assistant U.S. Attorneys Brandon Hale and Chris M. Stephens.
Law Enforcement and Prosecutors Receive Award for Case Involving Thwarted Capitol Hill Suicide BomberRead the Press Release
ALEXANDRIA, Va. – Federal prosecutors and members of the FBI’s Joint Terrorism Task Force were honored yesterday with the Anti-Defamation League’s SHIELD Award for their role in the investigation and prosecution of Amine El-Khalifi, a Virginia man who attempted to carry out a suicide bomb attack on the U.S. Capitol Building in February 2012.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, accepted the award on behalf of the U.S. Attorney’s Office, and he was joined by Assistant Director in Charge Valerie Parlave of the Federal Bureau of Investigation’s Washington Field Office.
According to court records and statements made in court, El-Khalifi sought to be associated with an armed extremist group, and in December 2011, he was introduced by a man he knew as “Hussien” to an individual named “Yusuf,” who was, in reality, an undercover law enforcement officer. Throughout December 2011 and January 2012, El-Khalifi proposed to carry out a bombing attack, and on Jan. 15, 2012, El-Khalifi stated that he had decided to conduct a suicide attack at the U.S. Capitol Building.
Over the next month, El-Khalifi traveled to the U.S. Capitol Building several times to conduct surveillance, choosing the spot where he would be dropped off to enter the building, the specific time for the attack and the method he would use to avoid law enforcement detection. El-Khalifi also asked Hussien to remotely detonate the bomb he would be wearing on the day of the attack if El-Khalifi encountered problems with security officers, and to provide El-Khalifi with a gun that he could use during the attack to shoot any officers who might attempt to stop him.
On Feb. 17, 2012, El-Khalifi traveled to a parking garage near the U.S. Capitol Building. El-Khalifi took possession of a MAC-10 automatic weapon and put on a vest containing what he believed to be a functioning bomb. Unbeknownst to El-Khalifi, both the weapon and the bomb had been rendered inoperable by law enforcement. El-Khalifi walked alone from the vehicle toward the U.S. Capitol, where he intended to shoot people and detonate the bomb. El-Khalifi was arrested and taken into custody before exiting the parking garage.
El-Khalifi pleaded guilty to attempting to use a weapon of mass destruction on June 22, 2012. He was sentenced on September 14, 2012, to 30 years in prison.
This case was investigated by the FBI’s Washington Field Office. Assistant United States Attorneys Gordon Kromberg and Michael Ben’Ary of the U.S. Attorney’s Office for the Eastern District of Virginia, as well as Trial Attorneys Joseph Kaster and Courtney Sullivan from the Justice Department’s National Security Division, prosecuted the case on behalf of the United States.
According to a press release issued by the Anti-Defamation League, the SHIELD Awards were created to honor law enforcement efforts in “major cases involving hate crimes, violent extremism and terrorism and bringing those responsible to justice. . . . The Award’s name reflects law enforcement’s role as protectors, and is also an acronym for the core values of the profession: Service, Honor, Integrity, Excellence, Leadership, and Dedication.”
A copy of this press release, along with prior releases relating to this case, 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.
Justice Department Sues to Stop Georgia Tax Return PreparerRead the Press Release
The United States filed a complaint yesterday asking a federal court in Atlanta to enjoin Joan Leger and her company, The 1804 Tax Group Inc., doing business as Liberty Tax Service, from preparing federal income tax returns for others, the Justice Department announced today.
The complaint alleges that since 2009 Leger, who resides in Stone Mountain, Ga., and the tax preparation businesses she owns have prepared almost 6,000 tax returns. According to the complaint, Leger understates her customers’ tax liabilities and overstates their refunds by creating or inflating deductions, wages, income, expenses or credits in order to maximize the earned income tax credit, in addition to wrongly claiming other credits and deductions. Leger’s practices include fabricating losses for non-existent businesses or businesses not owned and operated by the taxpayer, falsely claiming unreimbursed business expenses and falsely claiming the educational tax credit. In total, the government’s complaint alleges that the loss to the U.S. Treasury from Leger’s activities may exceed $2 million.
Return preparer fraud is one of the Internal Revenue Service’s Dirty Dozen Tax Scams for 2013 which can be viewed at www.irs.gov/uac/Newsroom/IRS-Releases-the-Dirty-Dozen-Tax-Scams-for-2013. In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website at www.justice.gov/tax/taxpress2013.htm .
Related Materials:
United States v. Joan Leger, etc.
Complaint for Permanent InjunctionJustice Department Reaches Settlement over Border Patrol Traffic Stops on Olympic PeninsulaRead the Press Release
U.S. Attorney Jenny A. Durkan announced today that the Department of Justice (DOJ) has reached a formal settlement with three men represented by the American Civil Liberties Union (ACLU) and the Northwest Immigrant Rights Project (NWIRP) over litigation regarding traffic stops on the Olympic Peninsula in Western Washington. Under the terms of the settlement, the Border Patrol will affirm its continued commitment to constitutional policing through a letter sent to the ACLU of Washington and the NWIRP. Additionally, within the next year, Border Patrol agents stationed at the Port Angeles Station will receive refresher training on traffic stops that require “reasonable suspicion” under the 4th Amendment to the U.S. Constitution. Finally, for the next 18 months, the Border Patrol will provide certain forms they use to document traffic stops to the ACLU and the NWIRP, providing the groups with information regarding the frequency and the Border Patrol’s rationale for conducting such stops. The forms provided to the groups will not include any information identifying the drivers or occupants of the vehicles involved in the stops.
“This settlement is confirmation that we can both ensure the safety of our borders and protect all members of our communities in a constitutional manner,” said U.S. Attorney Durkan. “I appreciate the dedication and hard work of the Border Patrol, who are both the first line of defense against danger and the first to welcome millions of our visitors. I commend all the attorneys who worked to reach a settlement that moves us forward.”
In April 2012, three plaintiffs, Jose Sanchez, Ismael Ramos Contreras, and Ernest Grimes, filed suit against the Border Patrol, United States Customs and Border Protection (“CBP”), and the Department of Homeland Security (“DHS”) alleging that Border Patrol agents were making traffic stops on the Olympic Peninsula without reasonable suspicion. The federal government denies that the Border Patrol has a practice of unlawfully stopping vehicles on the Olympic Peninsula and denies wrongdoing with respect to any of the stops involved in the litigation.
Today’s settlement requires both sides to pay their own attorney’s fees and does not involve any monetary payment to the plaintiffs. It brings the lengthy litigation to a conclusion and prevents the further expenditure of federal resources. The settlement agreement is posted on the U.S. Attorney’s website here.
The litigation was handled for the U.S. Attorney’s Office by Assistant United States Attorney Rebecca Cohen, and for the U.S. DOJ by Timothy Belsan from the Office of Immigration Litigation.
Jury Convicts Fayette County Man on Child Sexual Exploitation ChargesRead the Press Release
A man who sexually exploited four children and possessed child pornography was convicted by a jury on Tuesday, September 17, 2013, after a two-day trial in federal court in Cedar Rapids.
Benton Stong, age 76, from Oran, Iowa, was convicted of one count of sexual exploitation of children and four counts of possession of child pornography. The verdict was returned following about one hour of jury deliberations.
The evidence at trial showed that, in 2012, Stong used, persuaded, induced, and enticed four children to engage in sexually explicit conduct for the purpose of producing visual depictions of this conduct. The evidence also showed that, between 2009 and 2012, Stong possessed child pornography at his residence in Oran.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Stong remains in custody of the United States Marshal pending sentencing. Stong faces a mandatory minimum sentence of 15 years’ imprisonment and a possible maximum sentence of 110 years’ imprisonment, $1,250,000 in fines, $500 in special assessments, and at least five years and up to life on supervised release following any imprisonment. He also will be required to register as a sex offender.This case is being prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Fayette County Sheriff’s Office and the Iowa Internet Crimes Against Children Task Force.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 13-2014.
Jones and Van Horn Sentenced on FEMA Fraud ChargesRead the Press Release
OXFORD, Miss. Felicia C. Adams, United States Attorney for the Northern District of Mississippi, and James E. Ward, Special Agent in Charge of the Department of Homeland Security, Office of Inspector General announced that:
Tamya H. Jones, 36, of Houston, Texas, formerly of Sledge, Mississippi, was sentenced by Senior United States District Judge Glen H. Davidson in Aberdeen, Mississippi, and Laura Van Horn, 34, of Lansing, Michigan, formerly of Tunica, Mississippi, was sentenced by United States District Judge Sharion Aycock, following each defendant’s plea of guilty earlier this year to one count of fraud in relation to a claim for disaster benefits. The charge to which Jones pled guilty involved making a materially false statement to the Federal Emergency Management Agency (FEMA) in an application for benefits following a series of tornadoes that struck Mississippi in late April 2011. The charge to which Van Horn pled guilty involved making a similar false statement to FEMA in an application for benefits following the Mississippi River flood of May 2011.
Judge Davidson ordered Jones to serve 12 months and 1 day in prison, followed by 5 years supervised release. She was also ordered to pay restitution in the amount of $21,052.25. Ms. Jones has been ordered to report to prison on November 4.
Judge Aycock ordered Van Horn to serve 37 months in prison, followed by 5 years supervised release. She was also ordered to pay restitution in the amount of $4,199.38. Van Horn is already in custody serving her sentence.
James E. Ward, Special Agent in Charge for the U. S. Department of Homeland Security, Office of the Inspector General stated:
“The Department of Homeland Security, Office of Inspector General is dedicated to investigating fraud related to DHS programs, specifically FEMA Emergency Disaster Relief Funds. The charges against this defendant serve as an example of our commitment to investigating FEMA fraud allegations and pursuing federal prosecution to the fullest extent of the law. DHS-OIG places a high priority on the investigation of these types of crimes, which negatively impact our federal system and programs that are intended for law abiding citizens.”
Both cases were investigated by the United States Department of Homeland Security, Office of Inspector General, and were prosecuted by Assistant United States Attorney Robert Mims.
Anyone who has knowledge of fraud, waste, abuse, or allegations of mismanagement involving disaster relief operations, may contact the National Center for Disaster Fraud toll free at (866) 720-5721. Information can also be sent by fax to (225) 334-4707, by e-mail to [email protected] or by writing to National Center for Disaster Fraud, Baton Rouge, LA 70821-4909. Calls can be made anonymously and confidentially.
Indiana Man Sentenced for Mailing White PowderRead the Press Release
United States Attorney Deborah R. Gilg announced that David Naylor, 61, formerly of Perrysville, Indiana, was sentenced today in Lincoln, Nebraska, to 1 day in custody, 100 hours of community service and restitution in the amount of $1,847.89 by United States District Judge John M. Gerrard, for mailing a threatening communication to Mutual of Omaha. In addition, Naylor will serve a three year term of supervised release and pay a $100 special assessment. Naylor was previously incarcerated for 54 days in this case.
On May 14, 2012, the Mutual of Omaha mail processing facility in Blair, Nebraska received an envelope which had been mailed by Naylor for delivery by the United States Postal Service. When the envelope was opened, it was found to contain a white powder. The outside of the envelope stated “open carefully contains cornstarch.”
A standard protocol pertaining to ‘white powder incidents’ was put into effect: the air handling system was shut down, no one was permitted to enter or leave the facility, and employees in the immediate vicinity remained in place. Four employees remained in place, near the envelope, for approximately an hour until the white powder was found to be not hazardous. Reactions amongst these four people ranged from anger to fear.
The Omaha Fire Department hazardous materials unit responded and determined the powder was not harmful. Later testing at a lab confirmed that the substance was cornstarch.
This case was investigated by the Federal Bureau of Investigation.
Hogsett Announces Federal Jury Trial Conviction of Rushville-area ManRead the Press Release
RUSHVILLE – Joseph H. Hogsett, the United States Attorney, announced today the conviction of a Rushville-area resident on charges related to the illegal purchase of firearms. James I. Bowling, age 41, of Manilla, was found guilty by a jury of his peers after a two day trial in Indianapolis. The jury found that Bowling provided false information in purchasing a firearm, and illegally received a gun while under indictment
“Through our Violent Crime Initiative, we’re cracking down on those who acquire and use firearms in disregard of both the law and common sense,” Hogsett said. “This isn’t about making new laws – this is about enforcing those laws already on the books. By targeting habitual offenders who continue to illegally arm themselves, we’re making communities like Rushville safer, and we’re protecting the interests of all law-abiding gun owners in Rush County.”
An indictment filed last November charged that on July 19, 2012, Bowling was found to have falsely applied to purchase a .357 caliber revolver at a Rushville sporting goods store. In making that purchase, Bowling filed sworn statements with the Bureau of Alcohol, Tobacco, Firearms and Explosives, indicating that he was not under felony indictment or information. In fact, the defendant was aware of felony charges pending against him in Rush County Superior Court. Bowling was also convicted of illegally possessing the weapon in question.
These indictments come as part of the U.S. Attorney’s Violent Crime Initiative (VCI), and are the result of collaborative investigative efforts by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Indiana State Police.
Launched in March 2011, the VCI has produced a dramatic increase in the number of gun-related charges brought federally. In the year preceding the initiative, there were just 14 defendants charged with federal gun crimes by the U.S. Attorney’s Office. In the nearly two years since, more than 200 defendants have been charged.
According to Assistant U.S. Attorney Matthew J. Rinka, who prosecuted the case for the government, Bowling is expected to be sentenced at a hearing in Indianapolis in the next 60 days. The defendant faces up to 10 years in federal prison, as well as a possible fine of up to $250,000.
Hogsett Announces Conviction, Sentencing of Former Law Enforcement OfficialRead the Press Release
TERRE HAUTE – U.S. Attorney Joseph H. Hogsett announced this afternoon the sentencing of James E. Haley, Jr., age 31, of Terre Haute, to 68 months in federal prison by U.S. District Court Judge William T. Lawrence. Haley, a former Vigo County Sheriff’s Deputy, was charged in March of this year with one count of possessing child pornography. Hogsett said this prosecution comes as part of Operation Community Watch, an effort which aims to reduce abuse of Hoosier children through innovative investigative techniques and aggressive prosecution.
“Operation Community Watch is not simply about protecting Hoosier children, but also about sending a message that no one is above the law,” Hogsett said. “You are not anonymous online, and this is not a victimless crime – if you engage in this behavior, our office will find you and hold you fully accountable for your deplorable behavior.”
A criminal complaint filed in March indicates that the investigation into Haley began in early January 2013. At that time, an investigator with the Indiana State Police connected to a computer through an online peer-to-peer sharing network. The investigator was able to download more than one-hundred images from that individual, which allegedly depicted child pornography.
Investigators were able to trace the online activity of that individual, and were able to identify the residence in which the child pornography trafficking was taking place. This residence was an apartment in Terre Haute belonging to Haley. On March 15, 2013, a search warrant was executed at the residence, and law enforcement agents found a laptop and a number of digital media storage devices. An initial forensic examination of these devices revealed more than 40,000 files, some of which depict the abuse of children as young as 5 years.
According to Senior Litigation Counsel Steven D. DeBrota, who prosecuted the case for the government, Haley was also ordered to serve lifetime supervised release upon conclusion of his prison term, and faces lifetime registration as a sexual offender.
Hogsett noted the prosecution represented one of the first convictions under “Operation Community Watch,” an initiative launched earlier this year that allows prosecutors and investigators to use cutting-edge techniques to identify and charge people in Hoosier communities who are engaged in the receipt and trafficking of child pornography materials.
Specifically, Hogsett said today’s case was aided by techniques developed with Purdue University in which investigators have access to more effective on-site forensic examination software, allowing law enforcement to quickly scan thousands of images and videos when a warrant is served. These efforts were facilitated by the Indiana State Police, the Indiana Crimes Against Children Task Force, and Homeland Security Investigations.
This case was also brought as part of Project Safe Childhood, a larger nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Hogsett pointed out that in the last Project Safe Childhood reporting year, the Office prosecuted 52 defendants, an increase of 37% over the prior year, and 49 defendants were convicted and sentenced. These are all-time records for the Office. The Office conviction rate for PSC cases was 100%, a level it has been at since 1991.
The greatest measure of the PSC program’s impact, however, is the identification and rescue of child victims of sexual exploitation and abuse. Over the last year, the U.S. Attorney’s Office successfully identified more than 120 child victims, including minors in Indiana, numerous places in the United States, Canada, Switzerland, and other countries around the world.
Led nationally by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Hays Woman Pleads GuiltyTo Social Security, Medicaid FraudRead the Press Release
TOPEKA, KAN. - A woman from Hays, Kan., has pleaded guilty to stealing more than $104,000 in government funds from Social Security and Medicaid, U.S. Attorney Barry Grissom said today.
Earlyne C. Weigel, 57, Hays, Kan., pleaded guilty to one count of theft of government money.
In her plea, she admitted that in March 2003 she began receiving benefits from Social Security. Her benefits were adjusted to take into account her household income, including income from her husband. In 2005, she went to the Social Security field office in Hays, Kan., and falsely reported that she no longer lived with her husband. As a result, from 2004 to 2010 she received more than $43,473 in Supplemental Security Income benefits to which she was not entitled. In November 2008, investigators interviewed her husband, who told them that he and his wife had never lived apart while married.
Weigel also applied for and received Medicaid coverage beginning in 2004. Her Medicaid coverage was contingent on her eligibility for Supplemental Security Income benefits. From 2004 to 2010 she fraudulently received more than $60,919 in Medicaid benefits.
Sentencing is set for Dec. 9. She faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. Grissom commended the Social Security Administration, Office of Inspector General, Health and Human Services, Office of the Inspector General, the Medicaid and Fraud Abuse Division of the Kansas Attorney General’s Office and Special Assistant U.S. Attorney Trey Alford for their work on the case.Gates Man Sentenced for Transporting a Child for Sexual ActsRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Michael J. Rolfe, 48, of Gates, N.Y., who was convicted of the transportation of a minor, was sentenced to 17 years in prison and 20 years of supervised release by U.S. District Judge Frank P. Geraci, Jr..
Assistant U.S. Attorney Marisa J. Miller, who handled the case, stated that in August 2012, while employed as a long distance truck driver, the defendant took a child who was less than 12 years old, on a trip from Rochester, N.Y. to locations in Texas. Rolfe engaged in sexual acts, on more than one occasion, with the child while traveling outside of New York. The defendant was previously convicted on federal charges of possessing child pornography while serving in the U.S. Navy in 2002.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The sentencing is the culmination of an investigation on the part of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent In Charge James C. Spero, along with Investigators from the New York State Police, under the direction of Superintendent Joseph D’Amico.Four Sentenced for Drug TraffickingRead the Press Release
LAREDO, Texas – Four people have been ordered to prison for their role in a drug conspiracy to ship more than 1000 pounds of marijuana from Laredo to Dallas, announced United States Attorney Kenneth Magidson. Nancy Gutierrez, 28, and Jimmy Eusebio Trujillo, 50, both of Nuevo Laredo, Mexico, Pedro Menchaca, 39, of Rio Bravo, and Ricardo Cruz, 22, of Laredo, all entered guilty pleas at varying times in early 2013.
Today, U.S. District Court Judge Marina Garcia Marmolejo sentenced Gutierrez and Trujillo each to 60 months in federal prison, while Menchaca and Cruz will both serve 46-month-terms of imprisonment.
According to the evidence presented during the sentencing hearing today, these four defendants conspired between Aug. 13 – 20, 2009, to transport approximately 1,000 pounds of marijuana from Laredo to Dallas. Gutierrez recruited a Drug Enforcement Administration (DEA) confidential source to secure transportation for the marijuana. Subsequently, undercover agents, posing as would be transporters, then coordinated with Gutierrez and Trujillo on the delivery of the marijuana at a Laredo warehouse for loading onto an 18-wheeler and ultimate transportation to Dallas. They agreed the marijuana would be delivered to the warehouse in two separate loads.
Agents set up surveillance at the warehouse and witnessed Menchaca and Cruz in a beige minivan arrive at the warehouse and park next to a tractor trailer. They delivered 202.03 kilograms of marijuana which was then loaded onto the trailer. Menchaca and Cruz then departed the warehouse and were expected to return with another load of marijuana.
Trujillo was seen conducting counter surveillance around the area in a Dodge Durango.
The minivan and Durango traveled to a residence on the south side of Laredo where they picked up a second load of marijuana. A Webb County Sheriff’s Office (WCSO) deputy performed a traffic stop of Menchaca’s vehicle, at which time several duffle bags were discovered containing approximately 234 kilograms of marijuana.
Trujillo witnessed the seizure and proceeded back to the warehouse where he advised the undercover agents of the seizure and instructed them to proceed with taking the first load to Dallas. Ultimately, the tractor trailer and the marijuana load were seized, resulting in a total of 436.08 kilograms of marijuana seized in relation to these defendants.
The indictment against these four was one of seven relating to a long term Organized Crime Drug Enforcement Task Force (OCDETF) investigation dubbed “Operation Ultimate D.” The OCDTEF investigation charged several drug trafficking cells operating out of the Laredo area engaged in a conspiracy to distribute bulk quantities of marijuana, heroin, methamphetamines and cocaine from the Laredo area to distribution venues such as Dallas and Houston.
OCDETF Operation Ultimate D was spearheaded by the DEA with the assistance of Internal Revenue Service - Criminal Investigation, Webb County District Attorney’s Office, WCSO and the U.S. Marshals Service. Assistant United States Attorney Mary Lou Castillo is prosecuting the case.
Former Tuscaloosa Police Sergeant Sentenced to Ten Years for Sexually Assaulting Woman in CustodyRead the Press Release
Jason Glenn Thomas, 35, a former City of Tuscaloosa Police sergeant in Tuscaloosa, Ala., was sentenced today to serve ten years in federal prison followed by three years of supervised release for sexually assaulting a Tuscaloosa woman in violation of federal civil rights laws. A special assessment of $100.00 was also imposed.
Thomas pleaded guilty on April 18, 2013 to willfully violating the civil rights of a woman in his custody. According to court documents filed in connection with his guilty plea, Thomas admitted that shortly after midnight on May 28, 2011, he stopped and detained a female pedestrian without placing her under arrest. Thomas then transported the woman in a department issued patrol vehicle to a remote area and sexually assaulted her.
“Officers who sexually assault individuals in their custody defy the public trust bestowed upon law enforcement officials, and their actions will not be tolerated,” said Jocelyn Samuels Acting Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to investigate and prosecute law enforcement officials that violate their oath to protect their communities.”
“Although most police officers serve and protect the public with integrity, we remain deeply committed to prosecuting those few who, as defendant Thomas did, dishonor their badge by using it to take advantage of those they are sworn to protect” said Joyce White Vance, U.S. Attorney for the Northern District of Alabama.
This case was investigated by the Tuscaloosa resident agency of the FBI’s Birmingham Field Office, and was prosecuted by Trial Attorney D.W. Tunnage of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney George Martin for the Northern District of Alabama.
Former President of Wyoming Area Education AssociationRead the Press Release
Charged With EmbezzlementThe United States Attorney’s Office for the Middle District of Pennsylvania announced the filing of an Information in U.S. District Court in Scranton today charging Lisa Barrett, age 48, of Shavertown, Luzerne County, with embezzlement of funds of a labor organization.
According to United States Attorney Peter J. Smith, Barrett, the former president of the Wyoming Area Education Association (WAEA), has been charged with converting in excess of $30,000 of the labor organization’s funds to her own use from 2006 to 2012. Barrett resigned as WAEA President 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.
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 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.
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