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18 November 2013
Orange County Ambulance Company Pays More Than $3 Million to Settle Allegations That It Overbilled Federal Health Care ProgramsRead the Press Release
SANTA ANA, California – An Orange County-based ambulance company has paid the United States more than $3 million to settle a lawsuit alleging it received overpayments from the Medicare program and other federal healthcare programs for transporting patients who were not eligible for ambulance transports, United States Attorney André Birotte Jr. announced today.
A federal judge in Santa Ana on Friday unsealed a lawsuit filed under the False Claims Act against ambulance transport company FILYN Corporation, which does business under the name Lynch Ambulance and is based in Anaheim. Lynch Ambulance and two of its principals named in the lawsuit settled the case. On November 7 Lynch Ambulance paid $3.05 million to the United States to resolve allegations that from 2001 through 2007 it regularly billed Medicare and other federal healthcare programs for transporting patients who were not “bed-confined” or whose transports otherwise were not medically necessary. The federal health care programs that paid claims for medically unnecessary transports were Medicare, TRICARE and the Federal Employees Health Benefits Program.
The settlement resolves a lawsuit filed under the qui tam – or “whistleblower” – provisions of the federal False Claims Act, which allow private citizens with knowledge of fraud to bring civil actions on behalf of the United States and to share in any recovery. The lawsuit -- which was filled by two former Lynch Ambulance employees, Jamie Weatherly and Dawn Lucero -- was unsealed after the United States elected to take over part of the case and negotiated the settlement.
Lynch Ambulance has also entered into a Corporate Integrity Agreement with the Department of Health and Human Services. Glenn R. Ferry, Special Agent in Charge for the Los Angeles Region of the Office of Inspector General for the Department of Health of Human Services, said: “Taxpayers shouldn't be on the hook for these expensive and medically unnecessary ambulance trips. Count on federal law enforcement to aggressively investigate and prosecute such actions.”
Lynch Ambulance and its principals have resolved this case without admitting any wrongdoing.
The settlement with Lynch Ambulance is the result of an investigation by the United States Department of Health and Human Services, Office of the Inspector General; the Department of Defense, Office of the Inspector General; the Office of Personnel Management, Office of the Inspector General; and the Federal Bureau of Investigation.
Release No. 13-130
Ocala Man Pleads Guilty to Federal Drug, Firearm, and Theft ChargesRead the Press Release
Ocala, Florida – Acting United States Attorney A. Lee Bentley, III, announces that William Deboris Gordon, III (41, Ocala) today pleaded guilty, in two separate criminal cases, to charges of attempted possession of five kilograms or more of cocaine with the intent to distribute, possession of firearms affecting commerce by a convicted felon, and theft of government property by filing false income tax returns. He faces a minimum mandatory of 20 years, up to life in federal prison on the drug offense and a maximum of 10 years’ imprisonment on each of the firearm and theft offenses. A sentencing date has yet to be set.
According to the plea agreements, Gordon met with an undercover Drug Enforcement Administration (DEA) agent in Marion County, Florida, on March 18, 2013. During the recorded meeting, Gordon described his extensive network for distributing cocaine and his need to acquire kilograms of cocaine in order to supply his customers. When the agent and Gordon met again several days later, the agent showed Gordon five kilograms of cocaine. Gordon immediately agreed to purchase the drugs and was arrested. A search of Gordon’s vehicle revealed more than $60,000 in cash that Gordon had intended to use to purchase the cocaine. A subsequent search of his home revealed two loaded firearms, marijuana and assorted drug paraphernalia, including a cocaine press.
According to court documents, Gordon had a prior felony conviction for a state cocaine distribution offense, which prohibited him from possessing firearms. A separate financial investigation also showed that Gordon had obtained more than $763,900 in fraudulent refunds through the filing of false income tax returns from November 2011 through March 2013.
This case was investigated by DEA; the Bureau of Alcohol, Tobacco, Firearms and Explosives; Internal Revenue Service - Criminal Investigation; and the United States Secret Service. It is being prosecuted by Assistant United States Attorneys Robert E. Bodnar, Jr., and Samuel D. Armstrong.
Naugatuck Man Involved in Illegal Campaign Contribution Scheme Is SentencedRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that HARRY RAYMOND SOUCY, 61, of Naugatuck, was sentenced today by U.S. District Judge Janet Bond Arterton in New Haven to three years of probation, the first six months of which SOUCY must spend in community confinement (a “halfway house”), for his role in a scheme to direct illegal contributions into the campaign of a candidate for the U.S. House of Representatives. SOUCY was also ordered to pay a $5,000 fine.
According to court documents and statements made in court, in August 2011, the State of Connecticut applied for a court order enjoining Roll Your Own (“RYO”) smoke shops from continuing to operate without complying with state law governing tobacco manufacturers. RYO smoke shops are retail businesses that sell loose smoking tobacco and cigarette-rolling materials and offer customers the option of paying a “rental” fee to insert the loose tobacco and the rolling materials into a RYO machine, which is capable of rapidly rolling large quantities of cigarettes. Customers did not pay a tax on the RYO cigarettes when rolled by the RYO machines, in contrast to cigarettes purchased over-the-counter.
Fearing that the Connecticut General Assembly would enact legislation harmful to RYO smoke shop owners’ business interests during the 2012 legislative session, certain RYO smoke shop owners and their associates, including SOUCY, engaged in a scheme to direct conduit campaign contributions into the campaign of Christopher Donovan, a candidate for the U.S. House of Representatives. At the time, Donovan was also the Speaker of the Connecticut House of Representatives. As part of the scheme, the co-conspirators recruited multiple individuals to serve as conduit contributors to the campaign. These individuals permitted checks to be written in their own names to the campaign and were then reimbursed with cash, thereby concealing the fact that RYO smoke shop owners were contributing to the campaign.
In November and December 2011, participants in the scheme made four $2,500 conduit contributions to the Chris Donovan for Congress campaign. On approximately January 31, 2012, the campaign submitted to the Federal Election Commission (“FEC”) a report of campaign committee’s receipts and disbursements for the period October 1, 2011 through December 31, 2011. The report falsely stated the source and amount of the four $2,500 contributions that were received and deposited by the campaign committee during that time period.
In late April 2012, SOUCY was approached by investigators and began cooperating with the investigation. With his assistance, the RYO owners directed an additional $17,500 in conduit contributions to the Donovan for Congress Campaign, as well as a conduit contribution in the amount of $2,500 to a political party.
On July 24, 2012, SOUCY waived his right to indictment and pleaded guilty to one count of wire fraud deprivation of honest services, and one count of conspiracy to make false statements to the FEC and to defraud the United States.
Seven other individuals, including two employees of the Donovan for Congress campaign, have also been convicted of charges stemming from this scheme.
This matter was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorneys Christopher M. Mattei and Eric J. Glover.
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(203) 821-3722 [email protected]Mon Valley Drug Task Force Investigation Leads to Federal IndictmentRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-7725 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistFollow us on Twitter @NDWVnews
CLARKSBURG, WEST VIRGINIA — United States Attorney William J. Ihlenfeld, II, announced that an investigation by the Mon Valley Drug Task Force has led to an indictment being returned by a federal grand jury in Clarksburg.
ANTWAN GREGORY, age 32, of Tallahassee, Florida; KENNETH GREGORY, age 26, of Columbus, Ohio; and, JENNIFER FERRARO WOODSON, age 31, of Morgantown, West Virginia, were named in a seven-count Indictment charging them with “Conspiracy to Possess with Intent to Distribute and to Distribute Cocaine and Crack Cocaine.”
ANTWAN and KENNETH GREGORY each face a total of six counts and WOODSON faces a total of seven counts.
In addition to the conspiracy charge, other charges include “Distribution of Cocaine and Crack Cocaine,” “Distribution of Cocaine and Crack Cocaine within 1,000 Feet of West Virginia University,” and, “Use and Carry of a Firearm in Relation to a Drug-Trafficking Offense.”
The defendants each face up to twenty years in prison on the conspiracy and distribution charges; up to forty years in prison on the protected location charges; and, a mandatory term of five years in prison on the firearms charge.
This case will be prosecuted by Assistant United States Attorney Zelda E. Wesley and was investigated by the Mon Valley Drug & Violent Crime Task Force, consisting of officers from the Morgantown Police Department, the Monongalia County Sheriff’s Department, and the Drug Enforcement Administration.
All of the charges contained in the above-referenced indictments are merely accusations and not evidence of guilt, and each defendant is presumed innocent until and unless proven guilty. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the criminal history, if any, of the defendant.
Miami-Dade Resident Sentenced for Tax EvasionRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that defendant Annabel Cooper was sentenced today to one year and one day in prison, followed by three years of supervised release, and was ordered to pay $687,475.00 in restitution. Cooper previously pled guilty to an Information that charged her with attempting to evade tax, in violation of Title 26, United States Code, Section 7201.
According to court documents, between 2006 and 2009, Cooper evaded the payment of income taxes to the IRS by failing to accurately report her true income on her Form 1040. The total amount of income Cooper failed to report during the tax years in question was approximately $2,320,000. The resulting tax loss to the United States was approximately $687,475.
Mr. Ferrer commended the investigative efforts of IRS-CI. The case is being prosecuted by Assistant U.S. Attorney Jon M. Juenger.
An indictment is only an accusation and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Mexican Cocaine Supplier ConvictedRead the Press Release
LAREDO, Texas – Salvador Ibarra De-Alba, 48, of Nuevo Laredo, Tamaulipas, Mexico, has entered a plea of guilty for his role in a conspiracy to transport five kilograms or more of cocaine, announced United States Attorney Kenneth Magidson.
De-Alba was named in a sealed indictment returned Aug. 28, 2012, which indicated a drug trafficking organization had transported five kilograms or more of cocaine since 2008 from Nuevo Laredo, Mexico, to Houston and Miami, Fla., on a regular basis. De-Alba is the eighth conspirator to plead guilty in the case.
As part of the plea, De-Alba admitted he supplied cocaine to relatives living in Laredo and ensured its transportation further north into the United States. After the arrest of De-Alba’s brother, Juan Ramon Ibarra Sr. in 2010, De-Alba worked with his nephew, Juan Ramon Ibarra Jr., to continue the transportation of cocaine. Ibarra Sr. was sentenced to 130 months in federal prison along with another of his sons, Alejandro Ibarra, who received a sentence of 120 months. Ibarra Jr. is set for sentencing Feb. 3, 2014.
U.S. District Judge Marina Garcia Marmolejo, who accepted De-Alba's plea and the others in this case, has set his sentencing also for Feb. 3, 2014, at which time he faces a mandatory minimum of 10 years up to a maximum of life in prison as well as a possible $10 million fine. The United States is also seeking a money judgment in the amount of $2,408,204.
The case is the result of a two-year Organized Crime Drug Enforcement Task Force Investigation dubbed Silver Fox Hunt led by the Drug Enforcement Administration with the assistance of Homeland Security Investigations. Assistant United States Attorneys James Hepburn and Elizabeth Rabe are handling the case.
Maryland Man Sentenced to More Than Nine Years in Prison for Pair of Robberies in Northwest Washington-Defendant Attacked Two Women from Behind-Read the Press Release
WASHINGTON – Raymond Jones, 23, has been sentenced to serve nine years and eight months in prison for a pair of robberies that targeted women in Northwest Washington, U.S. Attorney Ronald C. Machen Jr. announced today.
Jones, whose last known address was in Prince George’s County, Md., pled guilty in July 2013, in the Superior Court of the District of Columbia, to robbery in one case and attempted robbery in the other. The Honorable Michael Ryan sentenced him on Nov. 15, 2013, to 17 years in prison for the crimes, but suspended some of that time on the condition that he successfully complete three years of supervised probation following his release from prison. Jones also must pay $610 in restitution to the victims.
According to the government’s evidence, on May 29, 2012, at about 6 p.m., Jones was seen pulling open a locked door to an apartment building in the 6100 block of 16th Street NW. He then attacked the victim as she walked through a fourth-floor hallway. He approached her from behind, put his right arm around her neck, and began choking her.
The victim fell and was pinned against the ground and the wall, while being choked by Jones, who then snatched her purse and an iPod from her hand. Believing that she would be killed, the victim reached back and pulled out one of Jones’s dreadlocks in the hopes that the police might find it and her attacker. Jones eventually released her and fled.
In the second attack, on Aug. 7, 2012, at 6:30 a.m., Jones accosted another woman as she walked to a bus stop in the 1500 block of Missouri Avenue NW. He struck the woman from behind, causing her to fall to the ground. Then he struggled with her, trying to wrestle away her purse. Jones then stole her purse and other items, which included a cell phone, cash, and earrings. The victim in this case suffered a fractured jaw. The injury required surgery and the victim’s jaw was shut for six weeks.
Jones previously was convicted of robbery in two other incidents, which took place in 2006 and 2007. Both times, he attacked victims from behind. During the investigation of the 2007 robbery, Jones admitted to police that he had carried out similar attacks.
In announcing the sentence, U.S. Attorney Machen commended the work of those who investigated the crimes from the Metropolitan Police Department (MPD). He also acknowledged the efforts of those who handled the case for the U.S. Attorney’s Office, including Paralegal Specialists Todd McClelland, Lynda Randolph, and Lynette Briggs; Victim/Witness Advocate Jennifer Clark; Information Technology Specialists Kimberly Smith and Anisha Bhatia; former Assistant U.S. Attorney Seth Adam Meinero, who investigated the case; Assistant U.S. Attorney Stephen Rickard, of the Appellate Section, and Assistant U.S. Attorney Phil Selden, who investigated and prosecuted the case.
13-397Manhattan U.S. Attorney Announces Claims Process for $2.35 Billion Madoff Victim FundRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today the start of the process for victims of the fraud perpetrated through Bernard L. Madoff Investment Securities LLC (“Madoff Securities”) to make claims against the $2.35 billion Madoff Victim Fund (the “MVF”). Victims may file claims under this process immediately. The MVF is funded through recoveries by the U.S. Attorney’s Office in various criminal and civil forfeiture actions, and is overseen by Richard Breeden, the former Chairman of the United States Securities and Exchange Commission, in his capacity as Special Master appointed by the Department of Justice to assist in connection with the victim remission proceedings.
The MVF also announced Department of Justice-approved eligibility criteria for granting victim claims. For the first time since Madoff Securities collapsed in December 2008, victims of the Madoff Securities fraud who invested through “feeder funds,” investment groups, and other pooled investment vehicles will be eligible to recover for their losses alongside direct investors in Madoff Securities.
Manhattan U.S. Attorney Bharara said: “This was an epic fraud and the process of compensating victims has been complex, but significant steps have been taken, and the Government is continuing its investigation to ensure that assets are recovered for the benefit of Madoff’s victims. With today’s announcement, we take a great step forward in returning the $2.35 billion collected so far to Madoff’s victims, and we hope to return even more. The process we have put in place opens the door for thousands of defrauded victims who otherwise might never have recovered anything. We have made eligibility to recover far more inclusive, and more equitable, than ever before. We will continue to work tirelessly with our partners from the FBI and the IRS to track down any and all proceeds of Madoff’s Ponzi scheme and return them to their rightful owners.”
Of the approximately $2.35 billion currently in the MVF, approximately $2.2 billion was collected as part of the historic December 2010 civil forfeiture recovery from the estate of deceased Madoff investor Jeffry Picower. The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family, and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff, and their co-conspirators. In addition, there are a number of pending civil and criminal matters being pursued by the U.S. Attorney’s Office that, along with other pending matters, could lead to further collections and resultant distributions from the MVF.
Under the eligibility criteria announced today, subject to limited exceptions, anyone that lost his or her own funds that were invested in Madoff Securities at the time of its collapse, and who can document their net loss, will be eligible to recover from the MVF. That may include the more than 10,000 investors whose claims were denied in the Madoff Securities bankruptcy as “indirect” claims. Victim claims must be received by the MVF no later than February 28, 2014. Information about the MVF, including detailed eligibility criteria and instructions for filing a claim, can be found on its website at www.madoffvictimfund.com. Further questions about the eligibility criteria or filing procedures should be directed to the office of the Special Master, by phone, at (866) 624-3670, or by e-mail, at [email protected].
Mr. Bharara praised the work of the FBI and the IRS in connection with collecting the funds to be distributed, and thanked the Asset Forfeiture and Money Laundering Section of the Department of Justice for its assistance in the remission proceedings.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
The Madoff Securities cases are being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Matthew L. Schwartz, Randall W. Jackson, John T. Zach, Arlo Devlin-Brown, Christopher Frey, and Paul M. Monteleoni are in charge of the cases.
Manhattan U.S. Attorney Announces Claims Process for $2.35 Billion Madoff Victim FundRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today the start of the process for victims of the fraud perpetrated through Bernard L. Madoff Investment Securities LLC (“Madoff Securities”) to make claims against the $2.35 billion Madoff Victim Fund (the “MVF”). Victims may file claims under this process immediately. The MVF is funded through recoveries by the U.S. Attorney’s Office in various criminal and civil forfeiture actions, and is overseen by Richard Breeden, the former Chairman of the United States Securities and Exchange Commission, in his capacity as Special Master appointed by the Department of Justice to assist in connection with the victim remission proceedings.
The MVF also announced Department of Justice-approved eligibility criteria for granting victim claims. For the first time since Madoff Securities collapsed in December 2008, victims of the Madoff Securities fraud who invested through “feeder funds,” investment groups, and other pooled investment vehicles will be eligible to recover for their losses alongside direct investors in Madoff Securities.
Manhattan U.S. Attorney Bharara said: “This was an epic fraud and the process of compensating victims has been complex, but significant steps have been taken, and the Government is continuing its investigation to ensure that assets are recovered for the benefit of Madoff’s victims. With today’s announcement, we take a great step forward in returning the $2.35 billion collected so far to Madoff’s victims, and we hope to return even more. The process we have put in place opens the door for thousands of defrauded victims who otherwise might never have recovered anything. We have made eligibility to recover far more inclusive, and more equitable, than ever before. We will continue to work tirelessly with our partners from the FBI and the IRS to track down any and all proceeds of Madoff’s Ponzi scheme and return them to their rightful owners.”
Of the approximately $2.35 billion currently in the MVF, approximately $2.2 billion was collected as part of the historic December 2010 civil forfeiture recovery from the estate of deceased Madoff investor Jeffry Picower. The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family, and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff, and their co-conspirators. In addition, there are a number of pending civil and criminal matters being pursued by the U.S. Attorney’s Office that, along with other pending matters, could lead to further collections and resultant distributions from the MVF.
Under the eligibility criteria announced today, subject to limited exceptions, anyone that lost his or her own funds that were invested in Madoff Securities at the time of its collapse, and who can document their net loss, will be eligible to recover from the MVF. That may include the more than 10,000 investors whose claims were denied in the Madoff Securities bankruptcy as “indirect” claims. Victim claims must be received by the MVF no later than February 28, 2014. Information about the MVF, including detailed eligibility criteria and instructions for filing a claim, can be found on its website at www.madoffvictimfund.com. Further questions about the eligibility criteria or filing procedures should be directed to the office of the Special Master, by phone, at (866) 624-3670, or by e-mail, at [email protected].
Mr. Bharara praised the work of the FBI and the IRS in connection with collecting the funds to be distributed, and thanked the Asset Forfeiture and Money Laundering Section of the Department of Justice for its assistance in the remission proceedings.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
The Madoff Securities cases are being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Matthew L. Schwartz, Randall W. Jackson, John T. Zach, Arlo Devlin-Brown, Christopher Frey, and Paul M. Monteleoni are in charge of the cases.
Lower Brule Woman Sentenced for AssaultRead the Press Release
United States Attorney Brendan V. Johnson announced that a Lower Brule, South Dakota, woman convicted of Assault by Striking, Beating and Wounding was sentenced on November 14, 2013, by U.S. Magistrate Judge Mark A. Moreno.
Monica Quilt, age 42, was sentenced to 6 months of imprisonment, 1 year of supervised release, and a $25 special assessment to the Federal Crime Victims Fund.
Quilt was indicted by a federal grand jury on May 15, 2013. She pled guilty to an Information on September 4, 2013.
The conviction stems from an incident between May 8, 2013, and May 9, 2013, wherein Quilt and the victim, who were involved in an intimate, dating relationship, had both been out drinking, but separately. During the morning hours of May 9th, Quilt went to her home and the victim arrived later. A physical assault occurred between Quilt and the victim, which resulted in the victim suffering injuries to his neck and face that required medical treatment.
The investigation was conducted by the Bureau of Indian Affairs, Lower Brule Agency. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Quilt is to self-report to the U.S. Marshals Service on December 12, 2013.
Lower Brule Man Sentenced for Assaulting A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that Cole Brouse, age 20, of Lower Brule, South Dakota, pled guilty to an Information that charged him with Assaulting, Resisting and Impeding a Federal Officer.
Brouse was sentenced on November 1, 2013, by U.S. Magistrate Judge Mark A. Moreno to 18 months of probation, a $1,500 fine, and a $25 special assessment to the Federal Crime Victims Fund.
The charge stems from an incident occurring on March 26, 2013, when U. S. Marshals and a Bureau of Indian Affairs officer went to Brouse’s home to look for another individual who had a federal warrant. Brouse was not home but arrived a short time later. When he arrived, he got upset at the officers, yelled at them and retrieved his pit-bull. The dog barked loudly, snarling and pulling on her leash in an attempt to get at the officers. The U.S. Marshals were able to talk to Brouse, who then put his dog away.
The investigation was conducted by the U.S. Marshals Service and the Bureau of Indian Affairs. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Local Business Owner Sentenced on Fraud ChargesRead the Press Release
ROANOKE, VIRGINIA – A former project manager at Breakell Inc., who pled guilty early this year to mail fraud charges, was sentenced today in the United States District Court for the Western District of Virginia in Roanoke.
Jamie Carl Graham, 34, of Roanoke, Va., previously pled guilty to one count of mail fraud. Today he was sentenced to 41 months of federal incarceration and was ordered to pay $1,290,624 in restitution.
“Mr. Graham stole materials and labor from his employer for his own benefit, and the benefit of his friends and other area business owners,” United States Attorney Timothy J. Heaphy said today. “This United States Attorney’s Office will continue to investigate and prosecute incidents of white collar fraud and bring those responsible to justice.“
Graham, while working as a project manager for Breakell, previously admitted to diverting labor and materials from his employer’s projects to other projects or for his own personal benefit. In order to divert the resources and hide the costs from Breakell, Graham forged change orders and miscoded expenses to and from various projects. As a result of Graham’s actions, Breakell used the US Postal Service and other commercial carriers to place orders with suppliers for the delivery of materials and sent payment to subcontractors for labor that Graham had wrongfully diverted.
The investigation of the case was conducted by Federal Bureau of Investigation. Assistant United States Attorneys Anthony Giorno and Daniel Bubar prosecuted the case for the United States.
Laguna Pueblo Man Pleads Guilty to Assaulting Intimate Partner Defendant Prosecuted as Part of Federal Initiative to Address the Epidemic Incidence of Violence Against Native WomenRead the Press Release
ALBUQUERQUE – Edwin Cheromiah, 28, pleaded guilty this morning to assaulting his intimate partner under a plea agreement that requires him to serve a 72-month federal prison sentence. Cheromiah’s guilty plea was announced by Acting U.S. Attorney Steven C. Yarbrough, DuWayne W. Honahni, Sr., Special Agent in Charge of District IV of BIA’s Office of Justice Services, and Police Chief Vincent M. Mariano of the Acoma Tribal Police Department.
Cheromiah, a member and resident of Laguna Pueblo, was arrested on Sept. 12, 2013, on an indictment charging him with assault resulting in serious bodily injury; assault with a dangerous weapon; and possessing and brandishing a firearm during a crime of violence.
This morning, Cheromiah pled guilty to a two-count felony information charging him with assault with a dangerous weapon and assault of an intimate partner by strangling and suffocation. In entering his guilty plea, Cheromiah admitted that on Dec. 27, 2010, he assaulted his intimate partner, an Acoma Pueblo woman, by placing a rifle into the mouth of the victim and threatening to kill her. He further admitted assaulting the victim by strangling her and attempting to suffocate her.
Cheromiah has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled. The indictment against Cheromiah will be dismissed after sentence is imposed.
This case was investigated by the Laguna/Acoma Agency of the BIA’s Office of Justice Services and the Acoma Tribal Police Department, and is being prosecuted by Assistant U.S. Attorney Kyle T. Nayback.
This case was brought pursuant to the Tribal Special Assistant U.S. Attorney (Tribal SAUSA) Pilot Project in the District of New Mexico which is sponsored by the Justice Department’s Office on Violence Against Women under a grant administered by the Pueblo of Laguna. The Tribal SAUSA Pilot Project seeks to train tribal prosecutors in federal law, procedure and investigative techniques to increase the likelihood that every viable violent offense against Native women is prosecuted in either federal court or tribal court, or both. The Tribal SAUSA Pilot Project was largely driven by input gathered from annual tribal consultations on violence against women, and is another step in the Justice Department's on-going efforts to increase engagement, coordination and action on public safety in tribal communities.
Kyle Woman Sentenced for Conspiracy to Distribute MarijuanaRead the Press Release
United States Attorney Brendan V. Johnson announced that a Kyle, South Dakota, woman convicted of Conspiracy to Distribute a Controlled Substance was sentenced on November 13, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Stephanie Standing Soldier, age 38, was sentenced to 16 months of imprisonment, 3 years' supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
The conviction stems from Standing Soldier conspiring with others to distribute at least 100 kilograms or more of marijuana on the Pine Ridge Indian Reservation between 2008 and 2012. Standing Soldier pled guilty to the charge on April 30, 2013.
This case was investigated by the Federal Bureau of Investigation, Northern Plains Safe Trails Drug Enforcement Task Force, South Dakota Division of Criminal Investigation, and the Bureau of Indian Affairs Office of Justice Services. Assistant U.S. Attorney Ted L. McBride prosecuted the case.
Standing Soldier remained in the custody of the U.S. Marshals Service.
Joshua Tyler Apland Sentenced in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Helena, on November 18, 2013, before Senior U.S. District Judge Charles C. Lovell, JOSHUA TYLER APLAND, a 21-year-old resident of Minot, North Dakota, was sentenced to a term of:
- ison: 100 months
- ecial Assessment: $200
- pervised Release: 5 years
APLAND was sentenced in connection with his guilty plea to conspiracy to possess with intent to distribute methamphetamine and being a felon-in-possession of a firearm.
In an Offer of Proof filed by Assistant U.S. Attorneys Michael S. Lahr and Zeno B. Baucus, the government stated it would have proved at trial the following:
On February 1, 2011, APLAND was convicted of an offense punishable by more than one year imprisonment in the state of North Dakota, therefore prohibiting him from possessing firearms.
In September 2012, members of the Missouri River Drug Task Force (MRDTF) investigated APLAND, X.X., Z.Z. and others for conspiring to possess methamphetamine with the intent to distribute in Helena as well as in other locations in Montana. As part of that investigation, on September 13, 2012, a Montana Division of Criminal Investigation (MDCI) agent learned that APLAND was in Helena. The agent also learned that APLAND was the subject of an arrest warrant for failing to comply with the terms of his probationary sentence in North Dakota.
On September 19, 2012, members of the MRDTF learned APLAND, X.X., and Z.Z. were staying at a residence in Helena. Agents then contacted the owner of the residence who confirmed APLAND, X.X., and Z.Z. were staying at the residence and were armed with handguns and a shotgun.
Later, on September 19, 2012, agents went to the residence and placed it under surveillance. Still later on the same day, APLAND left the residence in a vehicle. X.X. and Z.Z. left the residence in another vehicle;
A uniformed officer driving a patrol car attempted to stop the vehicle driven by APLAND. APLAND fled from the officer. Along the way, he threw a Weatherby, model PA-459, 12 gauge shotgun out of the vehicle. Law enforcement officials recovered that firearm. APLAND also disposed of a Smith and Wesson, model SW40VE, .40 caliber, semiautomatic pistol during the course of the pursuit. On September 20, 2012, law enforcement recovered that firearm near a stretch of the same road.
APLAND was ultimately arrested at a bar in Lincoln on September 19, 2012;
Members of the MRDTF interviewed APLAND following his arrest. APLAND admitted that he possessed the shotgun and pistol and that he threw the shotgun while being pursued by the patrol car.
APLAND admitted that, during the time period of the conspiracy, he, X.X., Z.Z., and Y.Y. traveled to Salt Lake City, Utah on multiple occasions. APLAND stated that during those trips they obtained a total of approximately 25 ounces of methamphetamine for distribution. APLAND stated that Y.Y. financed most the purchases of methamphetamine and received much of the methamphetamine obtained in Salt Lake City.
APLAND stated that he or other members of the conspiracy, including X.X., Z.Z., and Y.Y., then distributed the methamphetamine in Montana, North Dakota, and South Dakota. APLAND stated that he distributed some of the methamphetamine to Y.Y. in a meeting that occurred in Helena during the course of the conspiracy.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that APLAND will likely serve all of the time imposed by the court. In the federal system, APLAND does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was a cooperative effort between the Federal Bureau of Investigation and the Montana Division of Criminal Investigation.
Joint Statement Following the<br /> EU-US Justice and Home Affairs <br /> Ministerial MeetingRead the Press Release
Attorney General Eric Holder and Acting Department of Homeland Security (DHS) Secretary Rand Beers today hosted an EU/U.S. Justice and Home Affairs Ministerial with their counterparts in the European Union: Lithuanian Minister of Justice Juozas Bernatonis and Lithuanian Vice Minister of Interior Elvinas Jankevicius representing the Lithuanian Presidency of the Council of the EU; Greek Minister of Justice, Transparency and Human Rights Charalampos Athanasiou representing the incoming Greek Presidency of the EU; and European Commission Vice President Viviane Reding and Commissioner Cecilia Malmström representing the EU Commission.
The U.S. and EU together released the following statement on the meeting:
“Our meeting was constructive and productive. We discussed a broad array of issues critical to the European Union and the United States, including: addressing the problem of sexual abuse of children online; coordinating work on counter-terrorism and security issues; countering violent extremism; expanding cooperation in criminal matters; joint efforts in the areas of cybercrime and cybersecurity; and mobility, migration and border issues. In addition, we discussed the rights of victims of crime, the rights of persons with disabilities and the prosecution of hate crimes.
Of special note, we discussed the threat posed by foreign fighters going to third countries, in particular Syria, and the possible response to address it. We intend to promote close information sharing between our respective agencies, as well as coordinated initiatives in third countries. We also discussed efforts of the U.S. and the EU in countering violent extremism, and agreed to intensify our cooperation.
Our meeting also addressed data protection, and issues related to alleged activities of U.S. intelligence agencies. We together recognize that this has led to regrettable tensions in the transatlantic relationship, which we seek to lessen. In order to protect all our citizens, it is of the utmost importance to address these issues by restoring trust and reinforcing our cooperation on justice and home affairs issues.
The EU and the U.S. are allies. Since 9/11 and subsequent terrorist attacks in Europe, the EU and U.S. have stepped up cooperation, including in the areas of police and criminal justice. Sharing relevant information, including personal data, while ensuring a high level of protection, is an essential element of this cooperation, and it must continue.
We are therefore, as a matter of urgency, committed to advancing rapidly in the negotiations for a meaningful and comprehensive data protection umbrella agreement in the field of law enforcement. The agreement would act as a basis to facilitate transfers of data in the context of police and judicial cooperation in criminal matters, by ensuring a high level of personal data protection for U.S. and EU citizens. We are committed to working to resolve the remaining issues raised by both sides, including judicial redress (a critical issue for the EU). Our aim is to complete the negotiations on the agreement ahead of summer 2014.
We also underline the value of the EU-U.S. Mutual Legal Assistance Agreement. We reiterate our commitment to ensure that it is used broadly and effectively for evidence purposes in criminal proceedings. There were also discussions on the need to clarify that personal data held by private entities in the territory of the other party will not be accessed by law enforcement agencies outside of legally authorized channels. We also agree to review the functioning of the Mutual Legal Assistance Agreement, as contemplated in the Agreement, and to consult each other whenever needed.
We take stock of the work done by the joint EU-U.S. ad hoc Working Group. We underline the importance of the ongoing reviews in the U.S. of U.S. Intelligence collection activities, including the review of activities by the Privacy and Civil Liberties Oversight Board (PCLOB) and the President’s Review Group on Intelligence and Communications Technology (Review Group). The access that has been given to the EU side of the ad hoc Working Group to officials in the U.S. intelligence community, the PCLOB, the Review Group, and U.S. congressional intelligence committees will help restore trust. This included constructive discussions about oversight practices in the U.S. The EU welcomes that the U.S. is considering adopting additional safeguards in the intelligence context that also would benefit EU citizens.
As these ongoing processes continue, they contribute to restoring trust, and to ensuring that we continue our vital law enforcement cooperation in order to protect EU and U.S. citizens.”
Home-Invasion Robber Sentenced to 20 Years’ ImprisonmentRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Derrick Diaz, the former leader of a crew of robbers who targeted innocent civilians in their homes, was sentenced to 20 years in prison following his February 10, 2012, guilty plea to Hobbs Act robbery conspiracy. The sentence also included a term of supervised release of 3 years and an order that Diaz make restitution payments in the amount of $296,300 to his victims.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Brian Crowell, Special Agent-in-Charge, Drug Enforcement Administration (DEA), New York Division.
“As the leader of a vicious crew of robbers, Derrick Diaz violated the sanctity of the homes of innocent residents of Brooklyn and terrorized his victims with guns and knives,” stated United States Attorney Lynch. “Today, his life as a career criminal has earned him a home in federal prison for the next 20 years of his life.” Ms. Lynch expressed her grateful appreciation to the DEA, and thanked the New York City Police Department and the Office of the Kings County District Attorney for their assistance.
DEA Special Agent-in-Charge Crowell stated, “Nearly four years ago, the DEA and the NYPD tracked down and arrested this ruthless criminal, along with four of his gang members, who terrorized residents in and around the 61st Precinct in Brooklyn, NY. This organization was violent and a community’s worst nightmare, to include breaking into occupied homes and forcibly restraining children during robberies. This crew stole valuables worth hundreds of thousands of dollars with no concern for the children they terrorized. As part of this joint investigation, additional victims were identified resulting in dozens of home invasions linked to this armed robbery crew.” Mr. Crowell commended the men and women of the U.S. Attorney’s Office for the Eastern District of New York, the DEA and the New York City Police Department for their tenacious work.
Over the course of several robberies, Diaz and members of his crew broke into Brooklyn homes armed with, among other weapons, firearms and knives. They threatened their victims, including senior citizens and children, at gunpoint and knifepoint, pistol whipped victims, stabbed one victim, and bound and gagged multiple victims.
From the age of 16, Diaz has never gone longer than three years between arrests, other than time when he was already in custody of law enforcement. He has been convicted of burglary or related crimes five times, narcotics crimes twice, and various other offenses. Of Diaz’s burglary convictions, three involved his breaking into, or attempting to break into, a private residence. Today’s sentence was the culmination of Diaz’s first conviction in federal court.
Four members of the Diaz crew previously were convicted of federal felony charges in the Eastern District of New York.
The sentencing proceedings were held before United States District Judge Kiyo A. Matsumoto.
The government’s case is being prosecuted by Assistant United States Attorney Justin D. Lerer.
The Defendant
DERRICK DIAZ
Age: 40
Roselle Park, New JerseyEDNY Docket No. 10-CR-277 (S-4) (KAM)
High-Ranking Bank Official at Venezuelan State Development Bank Pleads Guilty to Participating in Bribery SchemeRead the Press Release
A senior official in Venezuela’s state economic development bank has pleaded guilty in New York federal court to accepting bribes from agents and employees of a New York-based broker-dealer (Broker-Dealer) in exchange for directing her bank’s security-trading business to the Broker-Dealer.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara of the Southern District of New York, and Assistant Director in Charge George Venizelos of the New York Office of the FBI made the announcement.
Maria De Los Angeles Gonzalez De Hernandez, 55, pleaded guilty today before U.S. District Judge Paul A. Engelmayer in the Southern District of New York to conspiring to violate the Travel Act and to commit money laundering, as well as substantive counts of these offenses. Sentencing for Gonzalez is scheduled for Aug. 15, 2014, before Judge Engelmayer.
At all times relevant to the charges, Banco de Desarrollo Económico y Social de Venezuela (BANDES) was a state-run economic development bank in Venezuela. The Venezuelan government had a majority ownership interest in BANDES and provided it with substantial funding.
According to court records, Gonzalez was an official at BANDES and oversaw the development bank’s overseas trading activity. At her direction, BANDES conducted substantial trading through the Broker-Dealer. Most of the trades executed by the Broker-Dealer on behalf of BANDES involved fixed income investments for which the Broker-Dealer charged the bank a mark-up on purchases and a mark-down on sales.
From early 2009 through 2012, Gonzalez participated in a bribery scheme in which she directed trading business she controlled at BANDES to the Broker-Dealer and, in return, agents and employees of the Broker-Dealer shared the revenue the Broker-Dealer generated from this trading business with Gonzalez. During this time period, the Broker-Dealer generated over $60 million in mark-ups and mark-downs from trades with BANDES. Agents and employees of the Broker-Dealer devised a split with Gonzalez of the commissions paid by BANDES to the Broker-Dealer. Emails, account records, and other documents collected from the Broker-Dealer and other sources reveal that Gonzalez received a substantial share of the revenue generated by the Broker-Dealer for BANDES-related trades. Specifically, Gonzalez received millions in bribe payments from Broker-Dealer agents and employees.
Additionally, Gonzalez paid a portion of the bribe payments she received to another BANDES employee who was also involved in the scheme.
To further conceal the scheme, the kickbacks to Gonzalez were often paid using intermediary corporations and offshore accounts that Gonzalez and others held in Switzerland, among other places.
Previously, three former employees of the Broker-Dealer – Ernesto Lujan, Jose Alejandro Hurtado, and Tomas Alberto Clarke Bethancourt – each pleaded guilty in New York federal court to conspiring to violate the Foreign Corrupt Practices Act (FCPA), to violate the Travel Act and to commit money laundering, as well as substantive counts of these offenses, relating, among other things, to the scheme involving bribe payments to Gonzalez. Sentencing for Lujan and Clarke is scheduled for Feb. 11, 2014, before U.S. District Judge Paul G. Gardephe. Hurtado is scheduled for sentencing before U.S. District Judge Harold Baer Jr. on March 6, 2014.
This ongoing investigation is being conducted by the FBI, with assistance from the SEC and the Justice Department’s Office of International Affairs. Assistant Chief James Koukios and Trial Attorneys Maria Gonzalez Calvet and Aisling O’Shea of the Criminal Division’s Fraud Section and Assistant United States Attorneys Harry A. Chernoff and Jason H. Cowley of the Southern District of New York’s Securities and Commodities Fraud Task Force are in charge of the prosecution. Assistant United States Attorney Carolina Fornos is also responsible for the forfeiture aspects of the case.
Additional information about the Justice Department’s FCPA enforcement efforts can befound at www.justice.gov/criminal/fraud/fcpa
High-Ranking Bank Official at Venezuelan State Development Bank Pleads Guilty in Manhattan Federal Court to Participating in Bribery SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Mythili Raman, the Acting Assistant Attorney General for the Criminal Division of the United States Department of Justice (“DOJ”), announced today that MARIA DE LOS ANGELES GONZALEZ DE HERNANDEZ (“GONZALEZ”) pled guilty in Manhattan federal court to charges relating to a scheme in which GONZALEZ, formerly a foreign official at Banco de Desarrollo Económico y Social de Venezuela (“BANDES”), a state economic development bank in Venezuela, accepted bribes from officers and agents of a New York-based broker-dealer (the “Broker-Dealer”) in exchange for GONZALEZ directing BANDES’s security-trading business to the Broker-Dealer. GONZALEZ pled guilty today before U.S. District Judge Paul A. Engelmayer to conspiring to violate the Travel Act and to commit money laundering, as well as substantive counts of these offenses.
According to the Information against GONZALEZ, the allegations in a previously filed criminal Complaint, statements made during the plea proceedings, and other documents filed in Manhattan federal court:
At all times relevant to the charges, BANDES was a state-run economic development bank in Venezuela. The Venezuelan government had a majority ownership interest in BANDES and provided it with substantial funding. GONZALEZ was an official at BANDES and oversaw the development bank’s overseas trading activity. At her direction, BANDES conducted substantial trading through the Broker-Dealer. Most of the trades executed by the Broker-Dealer on behalf of BANDES involved fixed income investments for which the Broker-Dealer charged the bank a mark-up on purchases and a mark-down on sales.
From early 2009 through 2012, GONZALEZ participated in a bribery scheme in which she directed trading business she controlled at BANDES to the Broker-Dealer, and in return, agents and employees of the Broker-Dealer shared the revenue the Broker-Dealer generated from this trading business with GONZALEZ. During this time period, the Broker-Dealer generated over $60 million in mark-ups and mark-downs from trades with BANDES. Agents and employees of the Broker-Dealer devised a split with GONZALEZ of the commissions paid by BANDES to the Broker-Dealer. Emails, account records, and other documents collected from the Broker-Dealer and other sources reveal that GONZALEZ received a substantial share of the revenue generated by the Broker-Dealer for BANDES-related trades. Specifically, GONZALEZ received millions in bribe payments from Broker-Dealer agents and employees.
In addition, GONZALEZ paid a portion of the bribe payments she received to another BANDES employee who was also involved in the scheme.
To further conceal the scheme, the kickbacks to GONZALEZ were often paid using intermediary corporations and offshore accounts that GONZALEZ and others held in Switzerland, among other places.
GONZALEZ, 55, of Caracas, Venezuela, pled guilty to five offenses. A chart containing the charges and maximum penalties is attached. Sentencing for GONZALEZ is scheduled for August 15, 2014 before Judge Engelmayer.
Previously, three former officers or employees of the Broker-Dealer, Ernesto Lujan, Jose Alejandro Hurtado, and Tomas Alberto Clarke Bethancourt, each pled guilty in Manhattan federal court to conspiring to violate the Foreign Corrupt Practices Act (the “FCPA”), to violate the Travel Act, and to commit money laundering, as well as substantive counts of these offenses relating, among other things, to the scheme involving bribe payments to GONZALEZ. Sentencing for Lujan and Clarke is scheduled for February 11, 2014, before U.S. District Judge Paul G. Gardephe. Hurtado is scheduled for sentencing before U.S. District Judge Harold Baer, Jr., on October 30, 2014.
Mr. Bharara praised DOJ’s Criminal Division Fraud Section and Office of International Affairs, and the Federal Bureau of Investigation, for their work in the investigation. Mr. Bharara also thanked the U.S. Securities and Exchange Commission for its assistance in this case, and noted that the investigation is continuing.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force and the Fraud Section of the DOJ Criminal Division. Assistant United States Attorneys Harry A. Chernoff and Jason H. Cowley, and Fraud Section Assistant Chief James Koukios and Trial Attorney Maria Gonzalez Calvet, are in charge of the prosecution. Assistant United States Attorney Carolina Fornos is responsible for the forfeiture aspects of the case.
Additional information about the Justice Department’s FCPA enforcement efforts can be
found at www.justice.gov/criminal/fraud/fcpa.
Click here to view chart(s)
US v Maria Gonzalez 13 Cr 901 (PAE) Criminal Information
Gregory Man Charged with Second Degree Burglary and ForgeryRead the Press Release
United States Attorney Brendan V. Johnson announced that a Gregory, South Dakota, man has been indicted by a federal grand jury.
Roger B. King, age 45, was indicted on April 12, 2013, for Second Degree Burglary and Forgery. King appeared before U.S. Magistrate Judge Mark A. Moreno on November 13, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 15 years of imprisonment and/or a $250,000 fine, 3 years of supervised release, an additional 2 years of supervised release upon revocation, and a mandatory $100 special assessment on each count to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges are merely accusations, and King is presumed innocent until and unless proven guilty.
The Indictment alleges that on June 9, 2012, King unlawfully entered a residence and wrote stolen checks to different entities.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
King was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Gladstone Man Indicted for Child PornRead the Press Release
Project Safe Childhood
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Gladstone, Mo., man has been indicted by a federal grand jury for producing, distributing and possessing child pornography.
Barry Alan Darlington, 73, of Gladstone, was charged in a five-count indictment returned under seal by a federal grand jury on Thursday, Nov. 14, 2013. That indictment was unsealed and made public upon Darlington’s arrest and initial court appearance on Friday, Nov. 15, 2013. Darlington remains in federal custody pending a detention hearing on Nov. 20, 2013.
Darlington is charged with three counts of producing child pornography over a three-year period. The federal indictment alleges that Darlington used a minor, identified as “Jane Doe,” to produce child pornography between June 1, 2001, and May 1, 2004.
The indictment also alleges that Darlington distributed child pornography over the Internet in September 2005 and that he was in possession of child pornography on July 18, 2013.
In seeking to have Darlington detained without bail, the government contends that he has indicated a continuing sexual interest in other children and has destroyed evidence.
According to the government’s detention motion, Darlington furthered the exploitation of his child victim by distributing some of the images he produced over the Internet. Investigators also found in Darlington’s possession multiple additional images and movies of the sexual abuse of other children, including babies. Online chat logs indicate that Darlington distributed other, “commercial” (that is, not self-produced) child pornography to others over the Internet.
The detention motion also cites online chats in which Darlington admitted he had been ogling a young neighbor girl and tried to arrange for her to spend the night at his house. Darlington says in those chats that he loves to go to malls and look at “young folks,” and that he “checks out the kids” when he’s at the grocery store.
The government will produce evidence that Darlington destroyed a computer hard drive after being confronted by law enforcement with evidence that he possessed child pornography.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Katharine Fincham. It was investigated by the Gladstone, Mo., Police Department and the Western Missouri Cyber Crimes Task Force.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."FreshPoint, Inc. Pays $4.2 Million to Settle False Claims LitigationRead the Press Release
SAVANNAH, GA: FreshPoint, Inc. a wholly owned subsidiary of Sysco Corporation, has paid the United States $4.2 million to settle allegations that it submitted false claims to the United States in connection with the sales of fresh fruit and vegetables to the Department of Defense and other Department of Defense customers.
The settlement resolves allegations that during the period of December 17, 2007 through September 11, 2009, FreshPoint over-charged the government on thousands of sales by improperly adding random price mark-ups known as “marketing earned income” or “MEI” to invoices submitted by FreshPoint to the Department of Defense. These invoices were submitted pursuant to contracts that FreshPoint had with Department of Defense to supply fresh fruits and vegetables to its customers, including military troops. MEI was added to bring the price of those fresh fruits and vegetables to the perceived market value of the products. The United States contends that this addition of MEI was a violation of the contracts in place between FreshPoint and Department of Defense.
United States Attorney Edward J. Tarver said, “This settlement demonstrates the commitment of the United States Attorney’s Office to the vigorous enforcement of the False Claims Act. All contractors who do business with the Government are expected to abide by the rules, no matter who you are. Enforcement actions such as this are necessary to protect American taxpayers and to protect our troops.”
The civil settlement announced today resolves allegations against FreshPoint and Sysco that were originally part of a qui tam or whistleblower lawsuit, filed by Charles Hall, a former FreshPoint employee. As a result of today’s settlement, Mr. Hall will receive a share of the settlement proceeds. Under the qui tam provisions of the False Claims Act, a private party can file an action on behalf of the United States and receive a portion of any recovery.
United States Attorney Tarver praised the hard work of Defense Criminal Investigative Services Special Agent Heather Hamed and Retired Defense Criminal Investigative Services Special Agent Chip Curington, along with Defense Contract Audit Agency Auditor Keith Melville. The United States was represented by Assistant United States Attorneys Shannon Heath Statkus and Edgar D. Bueno, and Trial Attorney Kelley Hauser from the Department of Justice, Civil Frauds Division. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Former Watertown Town Councilman and Ex-Wife Plead Guilty to Marijuana Distribution and Money LaunderingRead the Press Release
BOSTON – A former Watertown Town Councilman and his ex-wife pleaded guilty today to marijuana distribution and money laundering charges in a case that arose from a law enforcement seizure of more than 1,000 marijuana plants found in the former councilman’s warehouse in 2011.
Thomas Gus Bailey, 51, pleaded guilty to conspiracy to manufacture and distribute marijuana, distribution of marijuana, and conspiracy to commit money laundering. Barbara Waldman, 49, pleaded guilty to conspiracy to commit money laundering.
From at least 2001 through October 2011, Bailey ran a marijuana cultivation and distribution business which overlapped with the time he served on Watertown’s Town Council (2002 to 2006). Over this 10-year period, Bailey gradually expanded his lucrative marijuana business by moving his operation to successively larger indoor grow locations and hiring more workers to trim his marijuana plants and prepare the marijuana for sale. Further, beginning in at least 2006, he orchestrated a money laundering scheme where he and his co-conspirators, including his ex-wife, as well as his former mistress, laundered more than $1 million in drug proceeds. At Bailey’s direction, his co-conspirators made hundreds of separate cash deposits in amounts of $5,000 or less into their bank accounts, and then provided checks to Bailey in furtherance of his marijuana operation. Waldman was responsible for laundering at least $900,000 as part of this scheme. All of Bailey’s and Waldman’s co-defendants have also pleaded guilty in this case.
On the charge of conspiracy to manufacture and distribute marijuana, Bailey faces a maximum sentence of a lifetime in prison, lifetime of supervised release, and a $10 million fine; on the charge of distribution of marijuana, Bailey faces a maximum sentence of five years in prison, a lifetime of supervised release, and a $250,000 fine; on the charge of conspiracy to commit money laundering, Bailey and Waldman face a maximum sentence of 20 years in prison, a lifetime of supervised release, and a $500,000 fine or twice the value of the property involved in the money-laundering transactions, whichever is greater. Both defendants will be sentenced on Feb. 27, 2014.
United States Attorney Carmen M. Ortiz; John J. Arvanitis, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; John G. Collins, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Acting Chief Keith MacPherson of the Waltham Police Department, made the announcement today. The Suburban Middlesex County Drug Task Force also provided assistance to the investigation. The case is being prosecuted by Young Paik of Ortiz’s Drug Task Force Unit.
Former Puerto Rico Police Officers Sentenced for Roles in Scheme to Extort a State Defendant for $50,000Read the Press Release
Two former police officers with the Police of Puerto Rico were sentenced to serve 63 and 60 months in prison for attempting to extort a defendant and soliciting bribe payments of $50,000.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Rosa Emilia Rodriguez of the District of Puerto Rico made the announcement.
Abimael Arroyo-Cruz, 30, of Rio Grande, Puerto Rico, was convicted by a jury on May 29, 2013, of conspiracy to commit federal programs bribery, bribery, conspiracy to commit extortion and attempted extortion. Josue Becerril-Ramos, 36, of Carolina, Puerto Rico, pleaded guilty to all four counts on May 17, 2013, midway through his trial. Arroyo was sentenced to serve 63 months in prison, and Becerril was sentenced to serve 60 months in prison.
Arroyo and Becerril arrested eight individuals for possessing unregistered firearms and marijuana on Aug. 2, 2012. The officers then solicited from one defendant a bribe payment of $50,000 to have his case dismissed. Beginning on Sep. 11, 2012, both officers spoke with the defendant multiple times over the telephone, discussing payment details and strategies for dismissing the defendant’s case.
Arroyo and Becerril collected approximately $35,000 of the $50,000 demanded from the defendant in two different payment installments. Unbeknownst to the officers, however, the individuals who dropped off the payments were cooperating with federal law enforcement.In exchange for the bribes, Arroyo and Becerril devised a plan whereby the officers would misidentify a co-defendant in court, leading to the dismissal of the defendant’s case. When asked under oath at the preliminary hearing to identify the defendant, Arroyo instead identified a co-defendant. Arroyo confirmed to the defendant following the hearing that he deliberately misidentified the co-defendant as part of the plan to have the defendant’s case dismissed.
The case was investigated by the FBI’s San Juan field office. The case was prosecuted by Trial Attorneys Menaka Kalaskar and Marquest J. Meeks of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Timothy Henwood of the District of Puerto Rico.
Former Puerto Rico Police Officers Sentenced for Roles in Scheme to Extort A State Defendant for $50,000Read the Press Release
WASHINGTON – Two former police officers with the Police of Puerto Rico were sentenced to serve 63 and 60 months in prison for attempting to extort a defendant and soliciting bribe payments of $50,000.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Rosa Emilia Rodriguez of the District of Puerto Rico made the announcement.
Abimael Arroyo-Cruz, 30, of Rio Grande, Puerto Rico, was convicted by a jury on May 29, 2013, of conspiracy to commit federal programs bribery, bribery, conspiracy to commit extortion and attempted extortion. Josue Becerril-Ramos, 36, of Carolina, Puerto Rico, pleaded guilty to all four counts on May 17, 2013, midway through his trial. Arroyo was sentenced to serve 63 months in prison, and Becerril was sentenced to serve 60 months in prison.
Arroyo and Becerril arrested eight individuals for possessing unregistered firearms and marijuana on Aug. 2, 2012. The officers then solicited from one defendant a bribe payment of $50,000 to have his case dismissed. Beginning on Sep. 11, 2012, both officers spoke with the defendant multiple times over the telephone, discussing payment details and strategies for dismissing the defendant’s case.
Arroyo and Becerril collected approximately $35,000 of the $50,000 demanded from the defendant in two different payment installments. Unbeknownst to the officers, however, the individuals who dropped off the payments were cooperating with federal law enforcement.
In exchange for the bribes, Arroyo and Becerril devised a plan whereby the officers would misidentify a co-defendant in court, leading to the dismissal of the defendant’s case. When asked under oath at the preliminary hearing to identify the defendant, Arroyo instead identified a co-defendant. Arroyo confirmed to the defendant following the hearing that he deliberately misidentified the co-defendant as part of the plan to have the defendant’s case dismissed.
The case was investigated by the FBI’s San Juan field office. The case was prosecuted by Trial Attorneys Menaka Kalaskar and Marquest J. Meeks of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Timothy Henwood of the District of Puerto Rico.
Former Mingo Co. Prosecuting Attorney Pleads Guilty to Federal Rights ViolationRead the Press Release
Michael Sparks is the third former Mingo official to plead guilty in connection with federal corruption probe
*Audio clip included*
CHARLESTON, W.Va. - Former Mingo County Prosecuting Attrorney C. Michael Sparks entered a guilty plea in federal court in connection with a conspiracy to deprive a Mingo County resident of his constitutional rights, U.S. Attorney Booth Goodwin announced today. Sparks, 44, is the third former Mingo County official to plead guilty to federal charges involving a scheme to cover up evidence of illegal drug use and other misconduct by late Mingo County Sheriff Eugene Crum.
U.S. Attorney Booth Goodwin said, “Prosecutors are the representatives of the people. Instead of advancing the interests of the good people of Mingo County, Mr. Sparks chose to roll over for the special interests of a corrupt political faction.”
Earlier this year, a Mingo County drug defendant, identified as “G.W.,” began to provide the Federal Bureau of Investigation (FBI) with information about misconduct by then Sheriff Crum, including illegal drug use and election law violations. Crum learned that G.W., along with G.W.’s attorney, were providing information about Crum to the FBI. Crum and other Mingo elected officials, including Sparks and former Mingo Co. Circuit Judge Michael Thornsbury, carried out a plan to protect Crum and to stop G.W. from informing to the FBI. They arranged to offer G.W. a favorable plea deal if he would fire his attorney, identified as “C.W.,” who was assisting G.W.’s communication with federal authorities, and replace him with an attorney chosen by Crum and the other elected officials.
After G.W. fired C.W., Mr. Sparks entered into a plea agreement with G.W. under which three of five criminal counts pending against G.W. were dismissed. As part of the plea agreement, Mr. Sparks also accepted a forfeiture from G.W. of $10,000, which was $10,000 less than the forfeiture Mr. Sparks originally intended to seek from G.W. Moreover, as part of the agreement, Mr. Sparks agreed to recommend that the sentences for the two counts to which G.W. would plead guilty would run concurrently rather than consecutively. Mr. Sparks negotiated this plea agreement in part with former Mingo County Commissioner David Baisden himself and, at Baisden's behest, entered into a plea agreement more favorable that he otherwise would have. Mr. Sparks did these acts knowing that a more favorable agreement for G.W. was a necessary part of the scheme to coerce G.W. into firing C.W. in order to protect the Sheriff. Because Mr. Sparks was the county's Prosecuting Attorney, his cooperation in this regard was necessary to the scheme's success.
In the face of this coercion, G.W. fired his attorney, which the Mingo officials involved believed would protect Crum from federal investigation and public embarrassment.
United States District Court Judge Thomas E. Johnston presided over today’s plea hearing and will sentence Sparks on February 24, 2014. Sparks faces a year in prison. Sparks previously resigned as Prosecuting Attorney of Mingo County in late October. As part of his federal guilty plea, Sparks' plea agreement with the Office of the U.S. Attorney required him to resign as Mingo County’s Prosecuting Attorney and never seek elected office again. Sparks is also required to voluntarily surrender his license to practice law in every state in which he holds a law license, and withdraw his opposition to the petition seeking the immediate suspension of his law license in the State of West Virginia. Sparks also agrees not to contest disbarment proceedings in any state in which he is licensed to practice law.
Former Mingo County Circuit Judge Michael Thornsbury, 57, previously pleaded guilty in October for his role in the scheme to protect Crum and deprive G.W. of his rights. Thornsbury faces up to 10 years in prison when he is sentenced on January 13, 2014.
Former County Commissioner David Baisden pleaded guilty to an unrelated federal charge in connection with a scheme to illegally extort a discount from a Mingo County tire store. Baisden, 66, resigned from the Mingo County Commission in October. Baisden faces up to 20 years in prison when he is sentenced on January 14, 2014.
The investigation is being conducted by the FBI and the West Virginia State Police. Counsel to the United States Attorney Steven Ruby and Assistant United States Attorney Haley Bunn are handling the prosecution.
Click here to listen to an audio sound clip from U.S. Attorney Booth Goodwin
Former Marin County Mortgage Brokers Indicted for $2.4 Million FraudRead the Press Release
SAN FRANCISCO – A federal Indictment charging Diane Cobb and Paul Sloane Davis with fifteen counts of conspiracy, mail fraud, and wire fraud, and charging Diane Cobb with five counts of aggravated identity theft, was unsealed today in federal court, announced United States Attorney Melinda Haag.
Cobb, 56, and Davis, 74, were indicted by a federal grand jury on October 31, 2013. According to the Indictment, Cobb and Davis operated a financial services company in Marin County known as DM Financial. Through DM Financial, Cobb and Davis offered investors the opportunity to fund purported short-term “bridge loans” to borrowers who, according to Cobb and Davis, needed short-term financing for residential real estate transactions. Cobb and Davis allegedly fraudulently provided to these investors, among other things, the identity of the purported borrower, a promissory note reflecting the amount and terms of the loan, and a deed of trust securing the loan to the borrower’s real property. Based upon these documents and other representations made by Cobb and Davis, the investors believed that Cobb and Davis were directing their funds into secured loans with borrowers.
The Indictment further alleges that, in fact, the purported borrowers received none of the investors’ money, and did not even know that their identities were being used to solicit investments. Instead, Cobb and Davis allegedly diverted substantially all the money—approximately $2.4 million—for their own personal use or to make interest payments to prior investors to keep them from discovering the true nature of the scheme.
Cobb and Davis were arrested on November 13, 2013, in Las Vegas, Nevada. They both made their initial appearances in federal court in Las Vegas on that day, when they were released on bond. Bail was set at $100,000. Cobb and Davis are next scheduled to appear on November 26, 2013, at 9:30 a.m., for their initial appearance in the Northern District of California, before The Honorable Jacqueline Scott Corley, United States Magistrate Court Judge, in San Francisco.
The maximum statutory penalty for each count of mail fraud, wire fraud, and conspiracy, in violation of Title 18, United States Code, Sections 1341, 1343, and 1349, respectively, is 20 years’ imprisonment and a fine of $250,000 or twice the gross gain or loss from the offense, plus restitution. The statutory penalty for each count of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1), is two years’ imprisonment. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Thomas Stevens and Benjamin Kingsley are the Assistant United States Attorneys who are prosecuting the case, with the assistance of Phillip Villanueva and Rayneisha Booth. The prosecution is the result of a one year investigation by the Federal Bureau of Investigation.
Please note, an indictment contains only allegations against an individual and, as with all defendants, Diane Cobb and Paul Davis must be presumed innocent unless and until proven guilty.
(Cobb and Davis unsealed indictment )
Former Atlanta Investment Advisor Sentenced to Federal Prison for Embezzling More Than $2.5 Million from ClientsRead the Press Release
ATLANTA – Benjamin Daniel DeHaan has been sentenced on charges arising out of a scheme to defraud more than 50 clients.
“This defendant may have started out as a legitimate investment advisor, but he got greedy and began stealing from those who trusted him with their investments,” said United States Attorney Sally Quillian Yates. “He diverted money from his clients’ accounts and used it to fund a lavish lifestyle. Now he is headed to prison and will never work in the securities industry again.”
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated: “The level of greed and disregard for his clients earns this defendant a place in prison. While the FBI will continue to go after such individuals for investor related fraud, the damage to those investing is already done and all that is often left is the solace provided by a stiff prison sentence.”
According to United States Attorney Yates, the charges and other information presented in court: DeHaan owned and operated Lighthouse Financial Partners, LLC, an investment advisory service in Atlanta, Ga. He recruited investors by posting a series of videos on Lighthouse’s website and on YouTube. DeHaan told investors that he had developed a proprietary software program that allowed him to determine when to buy and when to sell a particular stock. Approximately 114 people entrusted him with money to invest on their behalf. At its peak, Lighthouse had approximately $6.7 million in assets under management.
From January 2010 through May 2012, DeHaan misappropriated and converted to his own use more than $2.5 million of his clients’ money. He used the fraud proceeds to purchase a new house for himself in Memphis, Tenn., and to purchase partial ownership of a restaurant and bar in Memphis. DeHaan also used his clients’ money to fund an investment account in his own name and to pay Lighthouse’s overhead and operating expenses. He attempted to cover-up his theft by emailing fraudulent account statements to investors. This provided victims a false sense of security and delayed their complaints to law enforcement.
Benjamin Daniel DeHaan, 37, of Decatur, Ga., was sentenced by United States District Judge Steve C. Jones to seven years and three months in federal prison, and was remanded immediately to the custody of the U.S. Marshal. He will serve three years of supervised release following his prison term, and was ordered to pay $6,931,619.13 in restitution to the victims. On February 1, 2013, DeHaan pleaded guilty to a Criminal Information charging him with wire fraud.
This case was investigated by Special Agents of the Federal Bureau of Investigation.
Assistant United States Attorney Russell Phillips prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney’s Office for the Northern District of Georgia is www.justice.gov/usao/gan.
Five New Arrests in $45 Million International Cyberheist CaseRead the Press Release
BROOKLYN, NY – Earlier today, five defendants were arrested in connection with their participation in the massive cyberheist campaign that inflicted $45 million in losses on the global financial system in a matter of hours in early 2013. Defendants Anthony Diaz, Saul Franjul, Saul Genao, Jaindhi Polanco and Jose Angeley Valerio were members of the New York-based cell of the international cybercrime organization, which used sophisticated intrusion techniques to hack into the systems of financial institutions, steal prepaid debit card data, and make fraudulent ATM withdrawals on a global scale. Newly seized photographic evidence reveals that the defendants sent the lion’s share of the proceeds to the organization’s leaders – including $800,000 of criminal cash proceeds sent in luggage and transported to Florida by bus for delivery to a cyberheist organizer.
The superseding indictment unsealed today charges the five arrested defendants with conspiracy to commit access device fraud. They will be arraigned at 2 p.m. today before United States Magistrate Judge Robert M. Levy at the U.S. District Court in the Eastern District of New York.1 Three of the original defendants, Jael Collado, Jose Familia Reyes and Chung Yu-Holguin, are also charged in the superseding indictment unsealed today. Four other defendants, Joan Luis Minier Lara, Evan Jose Peña, Elvis Rodriguez and Emir Yasser Yeje have pleaded guilty to charges resulting from the cyberheist. The eighth original defendant, Alberto Yusi Lajud-Peña, is deceased.
The charges and arrests were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Steven G. Hughes, Special Agent in Charge, United States Secret Service, New York Field Office.
“As alleged, just a few months ago, after exploiting cyber-weaknesses in the financial system to steal millions from ATMs, these defendants were packing bags to the brim with stolen cash, destined for the cybercriminal organizers of these attacks,” stated United States Attorney Lynch. “Today, we have sent them packing once again – but this time, to jail. We will not relent until all those responsible for these financially devastating cybercrimes are brought to justice.”
“This case is another example of the ability of cybercriminals to inflict significant damage to world financial systems. This investigation and the resulting indictments should serve as a reminder to cybercriminals that law enforcement will continue to utilize cutting-edge investigative techniques, traditional tactics and hard work to thwart complex transnational cybercriminal activity. We are grateful to our many law enforcement partners for their assistance in this investigation, in particular the U.S. Attorney’s Office in the Eastern District of New York, DHS Homeland Security Investigations, and our foreign law enforcement partners,” stated Secret Service Special Agent in Charge Hughes.
As alleged in the superseding indictment and other court filings, the defendants arrested today and their co-conspirators in this case engaged in cyberattacks known in the cyber underworld as “Unlimited Operations” – through its hacking “operation,” the cybercrime organization can access virtually “unlimited” criminal proceeds.
Defendants Anthony Diaz, Saul Franjul, Saul Genao, Jaindhi Polanco and Jose Angeley Valerio allegedly participated in two recent “Unlimited Operations” of staggering size. During the first operation, on December 22, 2012, hackers penetrated a credit card processor’s computer network, compromised prepaid debit card accounts of the National Bank of Ras Al-Khaimah PSC, also known as RAKBANK, and operated a coordinated ATM withdrawal campaign. In total, more than 4,500 ATM transactions were conducted in approximately 20 countries around the world, resulting in approximately $5 million in losses. In the second and even more damaging Unlimited Operation, which occurred on February 19-20, 2013, the hackers compromised prepaid debit card accounts associated with Bank Muscat, and operated a coordinated ATM withdrawal campaign. Over the course of approximately 10 hours, cybercells in 24 countries withdrew about $40 million from ATMs.
As alleged, as part of the RAKBANK and Bank Muscat campaigns, Diaz, Franjul, Genao, Polanco and Valerio operated the New York cell of “cashers,” who fanned out across the New York area to make thousands of withdrawals from ATMs. During the two operations, over the course of a few hours, the defendants and their co-conspirators withdrew approximately $2.8 million at over 140 different ATM locations in New York City. The defendants sent the bulk of the cash proceeds back to the organizers of the attacks.
As alleged in court filings and captured in a photograph seized from a conspirator’s iPhone, on March 2, 2013, just days after the Bank Muscat Unlimited Operation, defendant Franjul packed approximately $800,000 in cash into luggage destined for the late Alberto Yusi Lajud-Peña, who was then in Miami. Franjul’s co-conspirators took the cash-filled luggage on a bus to Florida, where they gave the cash to Lajud-Peña, who later fled to the Dominican Republic. New York cell members also used the funds to celebrate at high-priced nightclubs and go on shopping sprees for luxury goods, such as expensive watches and cars, many of which have been seized in the course of this investigation.
In announcing the arrests and charges, United States Attorney Lynch praised the extraordinary efforts of the Secret Service in responding to these attacks and investigating both the complex network intrusions that occurred overseas and the criminal activity occurring locally, and also expressed gratitude to U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI) in New York, and the Yonkers Police Department for their assistance in this investigation. Ms. Lynch also thanked MasterCard, RAKBANK and Bank Muscat for their cooperation with this investigation.
Diaz, Franjul, Genao, Polanco and Valerio face up to 7.5 years in prison on the charge of access device fraud conspiracy, as well as forfeiture and a fine of up to $250,000.
The government’s case is being prosecuted by Assistant United States Attorneys Cristina Posa, Hilary Jager, David Sarratt, and Brian Morris.
The Defendants:
ANTHONY DIAZ
Age: 24
Residence: Yonkers, New YorkSAUL FRANJUL, also known as “Conejo”
Age: 23
Residence: Yonkers, New YorkSAUL GENAO, also known as “Cocolito” and “Ely Genao”
Age: 24
Residence: Yonkers, New YorkJAINDHI POLANCO
Age: 29
Residence: Yonkers, New YorkJOSE ANGELEY VALERIO, also known as “Zikkytakki”
Age: 25
Residence: Yonkers, New York_____________________________
1 A sixth defendant, Franklyn Ferreira, is a fugitive from justice. The charges contained in the indictment are merely allegations, and the defendants, including those charged today, are presumed innocent unless and until proven guilty.
Cyberheist Indictment
First of Five "NifyFifty's" Owners Sentenced for Tax Evasion SchemeRead the Press Release
PHILADELPHIA - Robert Mattei, (75), of Del Ray Beach, Florida, a co-owner of the ANifty Fifty=s@ restaurant chain, was sentenced today to 15 months in prison for his role in a tax evasion conspiracy that cheated the Internal Revenue Service by failing to properly account for more than $15 million in gross receipts. Mattei pleaded guilty in May of 2012 to conspiracy, tax evasion, and bank fraud. Mattei, along with co-defendants Leo McGlynn, Brian Welsh, Joseph Donnelly, and Elena Ruiz, all of whom also pleaded guilty, constructed a long-running scheme to avoid paying millions of dollars in personal and employment taxes as related to their restaurant chain. The defendants not only evaded paying the taxes they owed, they filed income tax returns claiming they were due refunds based on the erroneous reporting of their incomes.
The restaurant owners evaded paying taxes since the restaurant was established in 1986 by, among other things, paying employees a portion of their wages with unreported cash in order to evade payroll taxes; paying suppliers with unreported cash; and having false tax returns prepared that under-reported income and falsely inflated expenses and deductions. Just between the years 2006 and 2010, the defendants deliberately failed to properly account for $15.6 million in gross receipts, thereby evading $2.2 million in federal employment and personal taxes. In the course of their conspiracy, Mattei, McGlynn, Donnelly, and Welsh committed bank fraud by submitting to the bank bogus income tax returns in order to secure several business loans.
In addition to the prison term, U.S. District Court Judge Mary McLaughlin ordered restitution. To date, the IRS has received $4,336,871 in tax payments and an additional $205,300 in forfeiture payments.
Co-defendant Leo McGlynn will be sentenced on November 19, 2013; co-defendant Joseph Donnelly will be sentenced November 20, 2013; co-defendants Elena Ruiz and Brian Welsh will be sentenced November 21, 2013.
This case was investigated by the Internal Revenue Service Criminal Investigation Division and the FBI. It is being prosecuted by Assistant United States Attorneys Nancy E. Potts and Paul G. Shapiro.
An Indictment or Information 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, 215-861-8525Federal False Claims Complaint Filed Against Former Blackfeet Tribal ChairmanRead the Press Release
The United States Attorney's Office announced that it has filed a False Claims Act complaint against former Blackfeet Tribal Chairman Patrick Charles Thomas in federal court. The civil complaint seeks over $944,000 in damages.
Thomas, a lifelong resident of the Blackfeet Reservation, served on the Blackfeet Tribal Business Council, the governing body of the Blackfeet Tribe, from 2004 to 2008; first in the position of Vice Chairman and then as Chairman.
The complaint relates to a December 2011 claim by Thomas against the Keepseagle v. Vilsak settlement fund. In Keepseagle v. Vilsak, Civil Action No. 1:99 CV 03119 (DDC) (EGS), a class action lawsuit was pursued by Native American farmers and ranchers who alleged that they had been discriminated against by the U.S. Department of Agriculture (USDA) and that they had been denied equal access to credit in the USDA Farm Loan Program. As a result of that lawsuit, on April 28, 2011, a $760 million settlement with the USDA was approved, a settlement fund was established, and claims were entertained from individual Native American producers who asserted that they had been discriminatorily aggrieved by the USDA in the lending process.
The Native American farmers and ranchers entitled to file a claim and receive relief under the settlement were producers who:
Farmed or ranched or attempted to farm or ranch between January 1, 1981 and November 24, 1999;
Sought, or attempted to seek, a farm loan from the USDA during that period;
Had their application denied, provided late, approved for a lessor amount than asked, was encumbered by restrictive conditions, or failed to have appropriate loan servicing;
Complained about discrimination to the USDA during the same time period; and
Suffered economic harm attributable to USDA actions.
Successful claimants were eligible to receive a payment of up to $50,000 and forgiveness of some or all outstanding USDA loans.
In its civil complaint, the United States seeks damages from Thomas based upon his claim that he was discriminated against by the Farm Service Agency (FSA) and that he had met the criterion relating to complaining to USDA about discrimination during the time period. The United States alleges that the claims were untrue and that Thomas would not have been able to share in the settlement if he had been honest.
As a result of his successful claim, the complaint alleges, the FSA forgave $201,917.53 in agricultural loan indebtedness, paid him a $50,000 award, and then paid Thomas's income tax liability on the loan forgiveness and the cash award in the amount of $62,979.38, for a total loss to the United States of $314,896.91. The False Claims Act allows the United States to recover three times the actual loss amount so the total demand is $944,690.73.
United States Attorney Mike Cotter stated:
The Keepseagle settlement fund was established by the Department of Agriculture to remedy a bona fide complaint that Native American producers had been treated unfairly in agricultural lending practices. Like all fraud, waste, and abuse in government programs, a fraudulent claim to a share of that fund diminishes the opportunity for the truly aggrieved to be properly compensated. And it undermines the integrity of the judicial system. This office is committed to holding false actors accountable and maintaining the confidence of the public in our ability to stem the tide of litigation fraud."
Englishtown, N.J., Pharmacy Burglar Sentenced to 63 Months in Prison for Conspiracy to Sell Stolen OxycodoneRead the Press Release
TRENTON, N.J.– A Brooklyn, N.Y., man was sentenced today to 63 months in prison for his involvement in a plot to burglarize a pharmacy in Englishtown, N.J., and sell the stolen narcotics for cash, U.S. Attorney Paul J. Fishman announced.
James Zarbailov, 23, previously pleaded guilty before U.S. District Judge Freda L. Wolfson to an information charging him with one count of conspiracy to distribute and possess with intent to distribute oxycodone. Judge Wolfson imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
The Union Hill-Supremo Pharmacy in Englishtown was burglarized shortly after 4:00 a.m. on June 17, 2012. Zarbailov and his fellow conspirators filled 17 garbage bags and two cardboard boxes with merchandise from the pharmacy, including approximately 1,988 dosage units of methylphenidate, 500 dosage units of hydromorphone, 300 dosage units of Opana (a trade name for oxymorphone) and 3,800 dosage units of oxycodone – all Schedule II controlled substances.
The stock lost by the pharmacy was valued at approximately $350,000.
Zarbailov admitted that he stole the drugs, and that he did so knowing they would be sold for profit.
In addition to the prison term, Judge Wolfson sentenced Zarbailov to serve three years of supervised release and ordered him to pay $334,722.12 in restitution.
Two of Zarbailov’s conspirators, David Mordukhaev, 22, and Dzheykhun Avshalumov, 24, both of Brooklyn, have previously pleaded guilty to the same charge. Mordukhaev’s sentencing is scheduled for Dec.3, 2013, and Avshalumov’s sentencing is scheduled for Dec. 19, 2013.
U.S. Attorney Fishman credited special agents of the FBI’s Red Bank Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and law enforcement officers from the Marlboro Township Police Department, under the direction of Police Chief Bruce E. Hall, for the investigation leading to today’s sentence.
The government is represented by Assistant U.S. Attorney John E. Clabby of the U.S. Attorney’s Office Criminal Division in Trenton.13-439
Defense counsel: Sanford Talkin Esq., New YorkEight Individuals Sentenced in Federal CourtRead the Press Release
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(304) 234-7725 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistFollow us on Twitter @NDWVnews
MARTINSBURG, WEST VIRGINIA – Eight individuals were sentenced by Judge Gina M. Groh according to United States Attorney William J. Ihlenfeld, II.
DONALD TILLOTSON, age 36, of Burlington, West Virginia, was sentenced to 96 months in prison and three years of supervised release for “Possession of Pseudoephedrine to be Used in the Manufacture of Methamphetamine.” TILLOTSON’s sentence reflects an enhancement for using a shake and bake method to manufacture methamphetamine, which caused a substantial risk to four minor children. The Court also ordered TILLOTSON to make restitution in the amount of $1,050.31 to the West Virginia Department of Environmental Protection for the cleanup. TILLOTSON was remanded to the custody of the United States Marshal pending designation to a Federal institution. This case was prosecuted by Assistant U.S. Attorney Stephen D. Warner and investigated by the Potomac Highlands Drug & Violent Crime Task Force, consisting of officers from the Federal Bureau of Investigation, and the West Virginia State Police - Bureau of Criminal Investigations.
DERRICK STANFORD SPENCER, age 35, of Martinsburg, was sentenced to 84 months in prison and three years of supervised release for “Possession with Intent to Distribute Crack Cocaine.” SPENCER was remanded to the custody of the United States Marshal pending designation to a Federal institution. This case was prosecuted by Assistant U.S. Attorney Paul T. Camilletti and investigated by the Eastern Panhandle Drug & Violent Crime Task Force, consisting of officers from the West Virginia State Police - Bureau of Criminal Investigation, the Martinsburg Police Department, the Berkeley County Sheriff’s Department, and the Jefferson County Sheriff’s Department.
MICHAEL SHAVAR PAYTON, age 28, and DEHAVEN DARNELL CRAIG, age 28, both of Martinsburg, were each sentenced to 60 months in prison and four years of supervised release for “Distribution of Crack Cocaine.” PAYTON and CRAIG were remanded to the custody of the United States Marshal pending designation to a Federal institution. This case was prosecuted by Assistant U.S. Attorney Jarod J. Douglas and investigated by the Eastern Panhandle Drug & Violent Crime Task Force.
DORIAN WILSON, age 25, of Martinsburg, was sentenced to 57 months in prison and three years of supervised release for “Possession with Intent to Distribute Crack Cocaine.” WILSON was remanded to the custody of the United States Marshal pending designation to a Federal institution. This case was prosecuted by Assistant U.S. Attorney Brandon S. Flower and investigated by the Eastern Panhandle Drug & Violent Crime Task Force.
FRANK BRINKMEYER, age 43, of Falling Waters, West Virginia, was sentenced to 41 months in prison and three years of supervised release for “Distribution of Heroin.” BRINKMEYER was remanded to the custody of the United States Marshal pending designation to a Federal institution.
MICHAEL SMITH, age 39, of Falling Waters, was sentenced to 37 months in prison and three years of supervised release for “Distribution of Heroin.” SMITH was remanded to the custody of the United States Marshal pending designation to a Federal institution.
PATRICIA BRINKMEYER, age 43, of Falling Waters, was sentenced to three years of probation for “Distribution of Heroin.”
This case was prosecuted by Assistant U.S. Attorney Robert H. McWilliams, Jr. and investigated by the Eastern Panhandle Drug & Violent Crimes Task Force.
Eagle Butte Woman Sentenced for Accessory After the FactRead the Press Release
United States Attorney Brendan V. Johnson announced that Alex White Eyes, a 24-year-old woman from Eagle Butte, South Dakota, pled guilty to Accessory After The Fact and was sentenced on November 14, 2013, by U.S. Magistrate Judge Mark A. Moreno.
White Eyes was sentenced to 3 years of probation and a $10 assessment to the Federal Crime Victims Fund
In September 2012, White Eyes, knowing that an offender had committed the crime of Assault of a Minor in Indian country, hindered and prevented the offender’s apprehension for trial and punishment by failing to provide this information to the Cheyenne River Sioux Tribal Law Enforcement Department and the South Dakota Department of Social Services.
The investigation was conducted by the Federal Bureau of Investigation and the Cheyenne River Sioux Tribal Law Enforcement Department. Assistant U.S. Attorney Mikal Hanson prosecuted the case.
Eagle Butte Man Charged with Assaulting Federal Officers and Firearm Possession ViolationsRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury.
Jason Todd Garreau, age 27, was indicted by a federal grand jury on November 5, 2013, for Assaulting, Resisting, and Impeding Federal Officers; Possession of a Firearm During a Crime of Violence; and Felon in Possession of a Firearm.
Garreau appeared before U.S. Magistrate Judge Mark A. Moreno on November 8, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to life of imprisonment and/or a $250,000 fine, 5 years of supervised release, an additional 3 years of supervised release upon revocation, and a mandatory $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges are merely accusations, and Garreau is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation and several other law enforcement agencies. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Garreau was remanded to the custody of the U.S. Marshals Service. A trial date has not been set.
Dustin Jay After Buffalo Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on November 14, 2013, before Chief U.S. District Judge Dana L. Christensen, DUSTIN JAY AFTER BUFFALO, an enrolled member of the Blackfeet Tribe, was sentenced to a term of:
- ison: 12 months and 1 day
- ecial Assessment: $100
- pervised Release: 3 years
AFTER BUFFALO was sentenced in connection with his guilty plea to burglary.
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"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 one escaped. 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 because he is aware of and knows the individual.
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 pled guilty to federal charges.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that he will likely serve all of the time imposed by the court. In the federal system, he does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Federal Bureau of Investigation.
Dominican Doctor and Assistant Arrested for Conspiring to Alter Fingerprints of Previously Deported AliensRead the Press Release
BOSTON – A Dominican doctor and his assistant were arrested for conspiring to harbor illegal aliens by altering their fingerprints through a surgical process.
Danilo Montero Ramirez, 61, and Teresa Araujo Martinez, 40, were arrested on November 16 for conspiracy to harbor illegal aliens and conspiracy to distribute controlled substances.
Earlier this month, federal agents became aware that Montero Ramirez, a licensed medical doctor in the Dominican Republic, was coming in the United States to meet with previously deported aliens and perform surgery on their hands to alter their fingerprints. Convicted criminals alter their fingerprints to help conceal their true identities from law enforcement and to disassociate themselves from their prior criminal history.
During the week of November 12, Montero Ramirez arrived in the United States from the Dominican Republic and arranged to perform surgery on individuals for $4,500. Montero Ramirez and Araujo Martinez made arrangements to perform the surgery on Nov. 16. Montero Ramirez and Araujo Martinez were arrested before the surgery began. Had the surgery taken place, these individuals would have been given controlled substances by Araujo Martinez. At the time of the arrests, agents seized surgical cutting equipment, gauze, bandages, syringes and prescription medication from the defendants. Araujo Martinez, also a Dominican citizen, was found to be in possession of a large quantity of pain medication, including Oxycodone and other substances.
If convicted on the charge of conspiracy to distribute a controlled substance, the defendants face a maximum of 20 years in prison, a fine of $1 million and three years of supervised release. If convicted on the charge of conspiracy to harbor aliens, the defendants face a maximum sentence of 10 years in prison, three years of supervised release, and a fine of $250,000.
United States Attorney Carmen M. Ortiz and Bruce Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston, made the announcement today. The case is being prosecuted by Kenneth G. Shine of Ortiz’s Major Crimes 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.
Dodge City Gang Member Sentenced in Racketeering CaseRead the Press Release
WICHITA, KAN. – A Dodge City man has been sentenced to 21 months in federal prison for assault with a dangerous weapon in connection with a federal racketeering case, U.S. Attorney Barry Grissom said today
Andrew Gusman, 21, Dodge City, Kan., pleaded guilty to assault with a dangerous weapon, which was a violent crime in aid of racketeering. In his plea, Gusman admitted that on March 30, 2011, he was with fellow Norteno gang members including co-defendants Alfonso Banda-Hernandez, Enrique Gobin and Jesus Sanchez.At a Love=s convenience store in Dodge City, they encountered George Gonzalez, who was a member of the rival Sureno gang. They threw gang signs at Gonzales and attempted to start a fight.
Later that day, they again encountered Gonzalez and began chasing his car. Gusman and Banda-Hernandez were in one car, and Gobin and Sanchez were in another car. During the case, Sanchez fired shots at Gonzalez. After the shooting, the four defendants met outside of town.
Gusman was one of 23 Norteno members to be indicted in May 2012. It was only the second time a federal RICO Act indictment (Racketeer Influenced and Corrupt Organizations Act) had been filed in Kansas. Twenty defendants have been convicted so far.
Grissom commended the Dodge City Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Ford County Sheriff's Office, the Kansas Bureau of Investigation, Assistant Aaron Smith and Assistant U.S. Attorney Lanny Welch for their work on the case.
District Man Sentenced to Six Years in Prison for Pair of Violent Crimes in Northeast WashingtonDefendant Assaulted Man at Bus Stop; Weeks Later, He Forced His Way into an Apartment at GunpointRead the Press Release
WASHINGTON – Steven Warren, 20, of Washington, D.C., has been sentenced to six years in prison on charges stemming from an assault that took place in June 2013 and a home invasion that occurred several weeks later, U.S. Attorney Ronald C. Machen Jr. announced.
Warren pled guilty in September 2013, in the Superior Court of the District of Columbia, to first-degree burglary, carrying a pistol outside the home or place of business, and assault with significant bodily injury. He was sentenced on Nov. 15, 2013 by the Honorable Patricia A. Broderick. Following his prison term, Warren will be placed on five years of supervised release.
According to the government’s evidence, the first crime took place about 3:20 a.m. on June 9, 2013, when Warren and two other men assaulted two people who were waiting at a bus stop in the 1900 block of West Virginia Avenue NE. While the assault was taking place, officers from the Metropolitan Police Department (MPD) entered the block, and Warren and the others fled on foot. The officers caught Warren about a block away. Warren punched one of the victims during the attack. The victim suffered a fracture of the left orbital bone of his eye.
Following his arrest, Warren was placed on high-intensity release pending further court proceedings. He was on release on Aug. 1, 2013, when he staged the home invasion. That day, at about 10:30 a.m., Warren attacked a man as he was leaving an apartment in the 1600 block of Montello Avenue NE. The man had been visiting another man, still inside the apartment.
Warren, who was standing in the foyer with a handgun by his waist, ordered the man back into the apartment. Once inside, he pointed the gun at the man’s face, and demanded money. The man handed over some cash, but Warren demanded more.
At that point, Warren forced the man into a bedroom. The second victim, meanwhile, had been hiding in this room, and he had managed to call 911 to report the break-in. Warren encountered this man in the bedroom, and he forced both of the victims to sit on the bed. Warren’s cellphone then rang and the victims heard Warren talking to an unknown individual about the fact that the police were surrounding the premises. Warren put the gun in the waist of his pants and went out of the back door, only to be arrested by quick-responding officers from the MPD. He has been in custody ever since.
In announcing the sentence, U.S. Attorney Machen recognized the outstanding efforts of the detectives and officers from the Metropolitan Police Department who investigated the case, as in both instances the quick actions of the first arriving officers were critical. He also acknowledged the efforts of Paralegal Specialist Todd McClelland. Finally, he commended the work of Assistant U.S. Attorney James Ewing, who prosecuted the case.
13-398Director Indicted for Stealing $385,000 from Home for Disabled PersonsRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that the director of a program that provided a home for disabled persons in Higginsville, Mo., has been indicted by a federal grand jury for embezzling more than $385,000 from the organization.
Terri Arlene Marr, 50, of Warrensburg, was charged in a 22-count indictment returned by a federal grand jury in Kansas City, Mo., on Friday, Nov. 15, 2013.
Marr was the director of the Progressive Alternative Living, Inc. (PAL) from 1991 through 2013. PAL is an organization that operates a home in Higginsville for disabled persons in need of assistance. PAL receives reimbursement for many of these individuals from Medicaid. Marr was responsible for keeping strict and accurate accounts of all money received by and disbursed for and on behalf of PAL.
The indictment alleges that Marr made payments on her personal credit cards out of the PAL bank account and issued payroll checks to an unindicted co-conspirator (who is not identified in the indictment) who had not performed any work or services for PAL. These payroll checks total approximately $175,400 from 2001 through 2013. PAL also paid approximately $10,600 in taxes (Social Security, Medicare, Missouri unemployment, and Federal unemployment) on behalf of the unindicted co-conspirator.
The federal indictment charges Marr with 16 counts of stealing from a health care benefit program by issuing checks for personal expenses to which she was not entitled from Progressive Alternative Living. Marr is also charged with six counts of stealing from a health care benefit program by issuing payroll checks to the unindicted co-conspirator from Progressive Alternative Living.
The indictment also contains a forfeiture allegation, which would require Marr to forfeit to the government any property derived from the proceeds of the offenses, including a money judgment of $385,218, which represents the proceeds of the alleged offenses.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Paul S. Becker. It was investigated by the FBI and the Higginsville, Mo., Police Department.Department of Justice Announces Investigation of the St. Louis County Family CourtRead the Press Release
The Justice Department announced today that it has opened a pattern or practice investigation of the Family Court of St. Louis. The investigation will focus on whether the court provides constitutionally required due process to all children appearing for delinquency proceedings and whether the court’s administration of juvenile justice provides equal protection to all children regardless of race.
This investigation will include a comprehensive review of policies, procedures, court documents and statistical data. As part of this investigation, the department will reach out to juvenile justice stakeholders, including community members and groups with knowledge of the Family Court’s processes.
“Protecting the constitutional rights of all children appearing in court is critical to achieving our goals of improving juvenile courts, increasing the public’s confidence in the juvenile justice system and maintaining public safety,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “During the course of this investigation, we will consider all relevant information, particularly any efforts the court has undertaken to ensure compliance with the Constitution and federal law.”
The department will conduct the investigation using its authority under Section 14141 of the Violent Crime Control and Law Enforcement Act of 1994, which prohibits a pattern or practice of deprivation of civil rights for juveniles in the administration of juvenile justice, and Title VI of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color or national origin by recipients of federal financial assistance. The department has conducted similar investigations in other jurisdictions, and most recently obtained important reforms in its investigation of the Juvenile Court of Memphis and Shelby County, Tennessee.
The Special Litigation Section of the Civil Rights Division is conducting this investigation. Individuals with relevant information are encouraged to contact the department via email at [email protected] or by phone at 855-228-2151.
Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt .
Contractor Pleads Guilty to Securities and Commodities FraudRead the Press Release
DALLAS — On the day his trial was to begin in federal court in Dallas, Brian Marshall, 49, of Tampa, Fla., pleaded guilty to one count of securities and commodities fraud, stemming from his scheme to defraud investors in connection with the sale of Home Solutions of America, Inc. stock, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Marshall was a vice-president and a member of the board of Home Solutions of America, Inc., a NASDAQ-traded company that was based in Dallas before it relocated to New Orleans, La. in July 2008. Home Solutions was in the business of construction and restoration, including new construction and restoration following natural disasters such as hurricanes. Home Solutions conducted some of its business through its largest subsidiary, Fireline Restoration, Inc., which was based in Tampa. Marshall was the president of Fireline. Frank J. Fradella of Covington, Louisiana, who was the CEO of Home Solutions, pleaded guilty to securities fraud in the Eastern District of Louisiana, and is awaiting sentencing.
In plea documents filed last week, Marshall admitted that between December 2006 and August 15, 2007, he ran a scheme to defraud public investors by fabricating false and fictitious revenue, operating income and costs in connection with a series of construction contracts in Tampa. Marshall caused Fireline to enter into construction contracts with private companies that he wholly or partially owned, including a $4 million contract for the construction of his ersonal residence.
Marshall admitted that he also caused Fireline to record revenue and income from the construction contracts that were false, because little, if any, work had actually been performed. Even though Marshall knew that the revenue, costs and income on the construction projects were false, he caused Home Solutions to report it to public investors in Home Solutions’ 2Q 2007 10-Q.
According to the plea agreement filed, if the Court accepts the plea, the parties agree that a sentence of no more than 60 months is the appropriate custody disposition of Marshall’s case. A sentencing date was not set.
Today’s conviction is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorney’s 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 more than 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, visit www.stopfraud.gov.
The investigation was conducted by the FBI and the FDIC Office of Inspector General, with substantial assistance from the Enforcement Division staff of the Securities and Exchange Commission. Assistant U.S. Attorneys J. Nicholas Bunch and Andrew Wirmani are in charge of the prosecution.
Business Owner Admits to Failing to Pay Taxes to IRSRead the Press Release
LAREDO, Texas - Leticia Reyna has entered a plea of guilty to failing to pay over employment taxes to the Internal Revenue Service (IRS), announced United States Attorney Kenneth Magidson.
According to the written plea agreement filed in the record of the case, Reyna admitted she and Jorge Montemayor operated Professional Skilled Services Inc., a home health care business that provided basic skilled care. She acknowledged that in her role as president, she had authority to conduct financial transactions on behalf of Professional Skilled Services Inc. and exercised signatory authority on the company's bank accounts. The indictment had alleged Reyna was required to collect, truthfully account for, and pay over employment taxes to the United States which include federal income tax, Social Security and Medicare taxes.
As part of the plea, Reyna admitted she knowingly and willfully failed to pay over to the IRS approximately $48,562.44 of federal income and FICA and Medicare taxes withheld from the taxable wages of employees of Professional Skilled Services Inc., for the fourth quarter of 2008. Reyna admitted that had different business expense and personal choices been made, funds would have been available to pay these taxes.
A sentencing date has not yet been set. She faces a statutory maximum penalty of five years in prison and a $250,000 fine. She was permitted to remain on bond pending the sentencing hearing.
The investigation resulting in the charges against Reyna was conducted by IRS - Criminal Investigation and FBI. Assistant United States Attorney Elizabeth R. Rabe is prosecuting the case.
Baptist Health Systems Settles Federal False Claims Act Civil LawsuitRead the Press Release
Baptist Health Systems, one of the largest health care providers in San Antonio, has paid $3,675,000 to the United States Department of Justice to settle allegations that it violated the federal False Claims Act by filing false claims for reimbursement under the Medicare program United States Attorney Robert Pitman announced today.
The federal investigation was triggered by allegations contained in a whistleblower lawsuit filed by Norma Rivera in United States District Court in San Antonio. The lawsuit alleged that Baptist Health Systems improperly filed claims with the Medicare program by failing to disclose on the claim that the patient receiving treatment had another insurance policy that covered the care at Baptist. The suit further alleged the Medicare program overpaid Baptist Health Systems on claims from 2003 through 2007. Under the law, a health care provider is required to disclose the fact that a patient has other insurance when it files its claim with Medicare. The claim is processed under the other insurance policy and, in most cases, Medicare pays whatever the patient was out of pocket (such as a deductible or copayment). If the health care provider receives a double payment because the insurance company is slow to pay, then the health care provider must reimburse Medicare.
United States Attorney Pitman stressed that Baptist Health Systems cooperated with the investigation, including conducting an audit of claims going back to January 2003. The audit was disclosed to the United States Attorney’s Office, allowing the government and Baptist to reach an acceptable settlement. Assistant United States Attorney Harold E. Brown, Jr., from the Affirmative Civil Enforcement Unit investigated the case and negotiated the settlement.
The False Claims Act provides that a whistleblower will receive a portion of the settlement for bringing the problem to the attention of the government. In this case, Norma Rivera received $661,500 as her share of the settlement. In addition to paying $3,675,000 to the Government, Baptist Health Systems paid Rivera’s attorneys’ fees and expenses.
Individuals who suspect Medicare fraud, waste or abuse are encouraged to report this information to the United States Department of Health and Human Services. Information on how to make this report is online at http://www.medicare.gov/forms-help-and-resources/report-fraud-and-abuse/report-fraud/reporting-fraud.html. You can also report Medicare fraud by calling 1-800-MEDICARE.
2013 CNMI Women’s SummitRead the Press Release
United States Attorney ALICIA A.G. LIMTIACO, U.S. Attorney for the Districts of Guam and the Northern Mariana Islands, was invited to speak at the Commonwealth of the Northern Mariana Islands (CNMI) Women’s Summit held in Susupe, Saipan, on August 1-2, 2013. The CNMI Women’s Summit was sponsored by the CNMI Women’s Association.
U.S. Attorney Limtiaco provided an overview of “Human Trafficking”, including how to identify victims, and ways in which the community can assist and provide for the needs of victims. U.S. Attorney Limtiaco also discussed issues relating to “Drug Abuse”, including public awareness and prevention efforts addressing drug abuse among youth and the elderly, such as the Red Ribbon Campaign and National Prescription Drug Take Back initiative.
Approximately one hundred participants attended the CNMI Women’s Summit which also included workshops on various topics, such as Leadership and Women; Education & Training; Effective Communication; Women in the Labor Force; Business Opportunities; Writing Business Plans; and Language & Culture.
U.S. Attorney Limtiaco was also invited and conducted outreach on human trafficking issues in an interview by Glenn Manglona, host of the Marianas Agupa Chamorro Radio talk show.
Attached are photos taken at the CNMI Women’s Summit.
15 November 2013
Zwolle Man Sentenced to 10 Years in Federal Prison for Firearm Possession ChargeRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced thatScott William Wood, 31, of Zwolle, La., was sentenced Wednesday by U.S. District Judge Maurice S. Hicks to 10 years in federal prison and three years of supervised release for possession of a firearm by a convicted felon. Woods pleaded guilty on July 29, 2013.
According to evidence presented at the guilty plea, members of the U.S. Marshal’s Service Task Force arrested Woods and three others at a casino hotel in Shreveport on June 20, 2012. During his arrest, agents discovered methamphetamine, drug paraphernalia, two handguns, ammunition and body armor in the hotel room. Wood admitted to bringing the guns into the hotel. The defendant has previously been convicted on drug possession and drug distribution charges.The Louisiana State Police, U.S. Marshal’s Service Task Force, U.S. Drug Enforcement Administration and the ATF conducted the investigation. Assistant U.S. Attorney Seth D. Reeg prosecuted the case.
Wilmington Man Sentenced for Drug Sale and Using Firearm During and in Relation to the Drug SaleRead the Press Release
RALEIGH- United States Attorney Thomas G. Walker announced that in federal court todayChief United States District Judge James C. Dever III, sentenced WILLIS SARVIS, 35, of Wilmington, North Carolina to life imprisonment followed by 5 years of supervised release.
On January 16, 2013, SARVIS was found guilty by a federal jury of the distribution of a quantity of phencyclidine in violation of Title 21, United States Code, Section 841(a)(1) and the possession of a firearm in furtherance of a drug trafficking crime in violation of Title 18, United States Code, Section 924(c). On February 21, 2012, SARVIS pled guilty to being felon in possession of a firearm in violation of Title 18, United States Code, Sections 922(g)(1) and 924.
On March 18, 2011, in Wilmington, officers responded to the Hillcrest Housing Community regarding a man that was shot, and ultimately died from his injuries. The investigation revealed that during the course of a drug deal, the victim had been shot twice with a Romarm/Cugir, WASR, 7.62 x 39 mm assault rifle. There were numerous shell casings from the rifle in the area and the investigation revealed two homes were also struck with bullets. The investigation quickly focused on Mr. SARVIS who had left the rifle with a friend who gave the rifle over to law enforcement. Police located SARVIS and took him into custody where he confessed to selling the deceased two small bags of PCP and shooting him when an altercation arose between them. SARVIS claimed the shooting was in self-defense.Investigation of this case was conducted by the Wilmington Police Department, the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Special Assistant United States Attorney Charity Wilson served as prosecutor for the government. Ms. Wilson is a prosecutor with the New Hanover County District Attorney's Office. District Attorney Ben David has assigned her to the United States Attorney's Office to prosecute federal Project Safe Neighborhood cases and other violent crime cases.
West Virginia Woman Sentenced to 27 Months in Prison for Embezzling $1 Million from Cincinnati CompanyRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
CINCINNATI – Melissa Trenary Grove, 41, of Bunker Hill, West Virginia was sentenced to 27 months in prison for embezzling more than $1 million from her employer in Cincinnati.
Carter M. Stewart, United States Attorney for the Southern District of Ohio and Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation Cincinnati Field Office (FBI) announced the sentence handed down today by U.S. District Judge Michael R. Barrett.
According to court documents, Grove was the chief financial officer for a computer consulting company called Collaborative Systems Group (CSG) in Cincinnati from 2007 through December 2009. Working from her home in West Virginia, she used a variety of schemes to embezzle approximately $1 million from the company.
During her three-year employment, Grove used a company credit card to pay for numerous personal items, all of which were unauthorized purchases. Grove also wired funds and wrote checks from the company accounts into her personal accounts. Grove also stole money from the company by secretly adding a relative to the company payroll. Eventually, the company management removed Grove from her position and the embezzlement was discovered. Most of the money she embezzled was used for personal expenses and family members. She also used the money to start her own spa business in West Virginia, which eventually failed.
“In terms of promoting respect for the law and affording adequate deterrence, the sentence should make clear to the person on the street that financial crimes do indeed have consequences, including imprisonment,” Assistant U.S. Attorney Tim Mangan told the court.
Grove was ordered to pay $1,065,092.99 in restitution to CSG, and ordered to forfeit any assets she has that were purchased with proceeds of the crime. She will report to prison in January 2014. She will be under court supervision for three years following her prison term.
Grove pleaded guilty on June 20, 2013 to one count of wire fraud.
U.S. Attorney Stewart commended the investigation by the FBI and Assistant U.S. Attorney Mangan, who represented the United States in the case.
West Monroe Man Sentenced to 18 Months in Prison for Bank FraudRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced today that Glen A. “Andy” Miller, 48, of West Monroe, was sentenced by U.S. District Court Judge Robert G. James to 18 months in prison and five years of supervised release for bank fraud. The defendant was also ordered to pay $97,413 in restitution.Miller was found guilty August 14, 2013 after a three-day jury trial. Witness testimony and documents admitted at trial revealed that from September 24, 2010 until January 25, 2011 Miller, an independent IT contractor, stole $97,413 from Will Transport, a Monroe company, where he was working at the time. Miller stole blank Will Transport company checks, made them payable to himself and then used the company’s stamp to put signatures on the checks. Miller deposited these checks into his account at Capital One Bank and withdrew the funds shortly thereafter. The trial evidence also revealed that Miller was previously terminated from the city of West Monroe for the fraudulent use of a city issued credit card.
“This defendant used his position to steal money from his employer,” Finley stated. “They trusted him to conduct his work honestly, but instead betrayed them and broke the law. Theft from employers and bank fraud are serious crimes and disruptive to members of the business community. We are committed to aggressively prosecuting this type of financial crime.”
The U.S. Secret Service conducted the investigation. Assistant U.S. Attorney Brandon B. Brown prosecuted the case.
Warrant Officer Sentenced in Theft of Government Property CaseRead the Press Release
RALEIGH – United States Attorney Thomas G. Walker announced that in federal court today United States District Judge Terrence W. Boyle sentenced KURT ALLEN BENNETT, 41, of Fort Bragg, North Carolinato 36 months imprisonment followed by 3 years of supervised release.
The criminal investigation of this case was conducted by United States Defense Criminal Investigative Service; the Federal Bureau of Investigation; the United States Department of Army – Criminal Investigation Command, and the Defense Logistics Agency. Assistant United States Attorney Banumathi Rangarajan is handling the prosecution on behalf of the Eastern District of North Carolina.
U.S. Attorney Walker stated, “This officer sought to achieve financial gain to the detriment of our war fighting efforts. We will aggressively prosecute those stealing from the taxpayers and putting our armed forces in conflict at risk.“
A Criminal Information was filed on January 3, 2013, charging conspiracy to steal and convert property belonging to the United States Government, in violation of Title 18, United States Code, Section 371, and two counts of theft and conversion of government property, in violation of Title 18, United States Code, Sections 641. On June 4, 2013, he pled guilty to the charges.
According to information presented in open court, at the time of the offense, BENNETT was an Apache helicopter pilot in the United States Army assigned to the 1st Battalion, 3rd Aviation Regiment, at Hunter Army Air Field in Savannah, Georgia. From October 18, 2008, through October 18, 2009, BENNETT was deployed with his unit to Contingency Operating Base (COB) Speicher in Iraq. During his deployment, BENNETT stole government property, concealed the stolen items in military connexes, and then shipped the stolen goods back to the United States along with the rest of his unit’s property to Fort Drum, New York.
After BENNETT returned to the United State from Iraq, he traveled to Fort Drum and transported the connex and its contents of stolen items with his personal vehicle back to Georgia. In total, BENNETT stole nearly $1.3 million worth of government property.
“This sentencing of a US Army officer highlights the effectiveness of aggressive investigative efforts by the Defense Criminal Investigative Service (DCIS) and other law enforcement partners,” stated Special Agent in Charge John F. Khin, DCIS-Southeast Field Office. “Chief Warrant Officer Kurt Bennett conspired with others to steal over $1 million worth of military property, in self-serving crimes that undermined our war fighting efforts in Iraq. DCIS’ top priority is to protect precious resources needed for military operations, especially in these times of reduced Defense budgets.”
“Kurt Bennett dishonored his country and put the lives of his fellow soldiers at risk by stealing property intended to further our war efforts in Iraq and Afghanistan. His sentence should reassure the public the FBI and our outstanding military partners will make sure those who betray our trust are held accountable,” said John Strong, Special Agent in Charge of the FBI in North Carolina.
BENNETT’s co-conspirator was Sergeant First Class Robert Alan Walker. Walker was sentenced on September 25, 2013, and received 18 months imprisonment.