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Tuesday 17 September 2013
Martin Man Sentenced for Distribution of MorphineRead the Press Release
United States Attorney Brendan V. Johnson announced that a Martin, South Dakota, man convicted of two counts of Distribution of a Controlled Substance was sentenced on September 12, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Alex Lee Salway, age 54, was sentenced to 12 months and 1 day on each count to run concurrently, 6 years of supervised release on each count to run concurrently, and a $200 special assessment to the Federal Crime Victims Fund.
The charges stem from Salway selling and distributing morphine pills within 1,000 feet of the Martin Grade School, a public elementary school in Martin, at two separate times on January 27, 2012. A federal jury in Rapid City found Salway guilty of both counts on June 20, 2013.
This case was investigated by the South Dakota Division of Criminal Investigation, the Bureau of Indian Affairs Office of Justice Services, the Martin Police Department, and the Northern Plains Safe Trails Drug Enforcement Task Force. Special Assistant U.S. Attorney Laura A. Shattuck prosecuted the case.
Salway remained in the custody of the U.S. Marshals Service.Manhattan U.S. Attorney Announces Court Judgment Finding Midtown Office Building Secretly Owned and Controlled by Government of Iran Subject to Forfeiture for Violations of the Iranian Transactions Regulations and Money Laundering OffensesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that United States District Judge Katherine B. Forrest has issued a decision granting summary judgment in favor of the United States’ claims for forfeiture of the 36-story Midtown Manhattan office building located at 650 Fifth Avenue, New York, New York (“the Building”), as the result of violations of the Iranian Transactions Regulations promulgated under the International Emergency Economic Powers Act (“IEEPA”), and the federal money laundering statutes. The Court found that the partners of the Building’s owner, the Alavi Foundation and Assa Corp., committed the IEEPA violations and money laundering offenses.
Claims against the building in this consolidated action by private parties holding judgments against the Government of Iran remain pending.
Manhattan U.S. Attorney Preet Bharara said: “The Judge’s opinion upholds what was the contention of this Office from outset: ‘Assa was (and is) a front for Bank Melli, and thus a front for the Government of Iran.’ The Judge’s ruling that Alavi and Assa committed IEEPA and money laundering violations paves the way for the largest-ever terrorism-related forfeiture, and provides a means of compensating victims of Iranian-sponsored terrorism.”
According to the amended civil forfeiture Complaint and the oral and written opinions issued by Judge Forrest in this case:
Overview
The Alavi Foundation has been providing numerous services to the Iranian Government, including managing the Building for the Iranian Government, running a charitable organization for the Iranian Government, and transferring funds from 650 Fifth Avenue Company to Bank Melli Iran (“Bank Melli”), a bank wholly owned and controlled by the Government of Iran. Likewise, Assa Corporation and Assa Company Limited (“Assa Co. Ltd.”) have been providing numerous services to Bank Melli in contravention of IEEPA and the Iranian Transactions Regulations promulgated thereunder, including transferring rental income generated from 650 Fifth Avenue Company to Bank Melli, following Bank Melli’s instructions with regard to Assa Corporation’s affairs, reporting back to Bank Melli on Assa Corporations’s financial situation and business dealings, and managing the affairs of Assa Corporation for the benefit of Bank Melli.
IEEPA confers upon the President the authority to take certain actions, defined in 50 U.S.C. § 1702, in response to declared national emergencies. The President has declared national emergencies with respect to the actions and policies of the Government of Iran: Executive Orders 12957, 12959, and 13059, and with respect to the proliferation of weapons of mass destruction (“WMD”), Executive Orders 12938 and 13382. The Treasury Department’s Iranian Transactions Regulations (“ITR”), 31 C.F.R. Part 560, and Weapons of Mass Destruction Proliferators Sanctions Regulations, 31 C.F.R. Part 544, implement these Executive Orders.
The Building was constructed in the 1970s by the Pahlavi Foundation, a non-profit organization operated by the Shah of Iran to pursue Iran’s charitable interests in the United States. The Building’s construction was financed by a substantial loan from Bank Melli.
Following the Iranian revolution of 1979, the Islamic Republic of Iran established the Bonyad Mostazafan, also known as the Bonyad Mostazafan va Janbazan (“Bonyad Mostazafan”), to centralize, take possession of, and manage property expropriated by the revolutionary government. The Bonyad Mostazafan was created in March 1979 by order of the Ayatollah Khomeini and approved by the Revolutionary Council of the Islamic Republic of Iran, and is controlled by the Government of Iran. The Bonyad Mostazafan sought to take control of the Shah’s property, including the assets of the Pahlavi Foundation. The Bonyad Mostazafan reports directly to the Ayatollah.
Between approximately October 1978 and approximately October 1979, all five previous directors of the Pahlavi Foundation resigned, and four new directors took their places. On February 25, 1980, an amended Certificate of Incorporation for the Pahlavi Foundation was filed renaming the Foundation “The Mostazafan Foundation of New York.” The Mostazafan Foundation of New York later renamed itself the Alavi Foundation.
The Government of Iran’s Involvement in the Management of the Building
In 1989, the Alavi Foundation and Bank Melli formed a partnership, 650 Fifth Avenue Company, in order to avoid paying federal taxes on rental income from the Building. Bank Melli’s ownership interest in 650 Fifth Avenue Company, however, was disguised through the creation of two shell companies. The Alavi Foundation transferred 35 percent of 650 Fifth Avenue Company to Assa Corporation, an entity wholly owned by Assa Co. Ltd. Assa Co. Ltd. is a Jersey, Channel Islands, United Kingdom, entity owned by Iranian citizens who represent the interests of Bank Melli. In conjunction with the transfer of the 35 percent interest in 650 Fifth Avenue Company to Assa Corp., Bank Melli cancelled its loan on the Building. Today, the Alavi Foundation owns 60 percent of 650 Fifth Avenue Company, and Bank Melli owns 40 percent of 650 Fifth Avenue Company, through Assa Corp. and Assa Co. Ltd.
The decision to convert Bank Melli’s mortgage on the Building into a partnership interest in 650 Fifth Avenue Company was discussed and approved by high-level Iranian Government officials. Among others, the head of the Bonyad Mostazafan (also the Deputy Prime Minister of Iran), the Office of the Prime Minister of Iran, the director of the Central Bank of Iran, and the general director of Bank Melli, as well as other Bonyad Mostazafan and Bank Melli officials, discussed and approved the partnership between the Alavi Foundation and Bank Melli. After the Alavi Foundation and Assa Corporation entered into the 650 Fifth Avenue Company partnership agreement, a Bonyad Mostazafan official forwarded the agreement to a Bank Melli official, noting that “the partnership is based on prior agreements between the Ministry of Finance, Bank Melli, and the Bonyad Mostazafan, with the only change being the building will be valued at two million dollars less than as previously agreed . . . .”
The Iranian Government’s control of the Alavi Foundation has continued. In 1989, Kamal Kharrazi was named as the new Iranian Ambassador to the United Nations. As a result of tension between the new Ambassador and the Alavi Foundation president, the Ambassador eventually demanded the president’s resignation. According to the minutes of a May 16, 1991, board meeting held in Zurich, Switzerland, the head of the Bonyad Mostazafan explained that, as directed by the Supreme Leader, several board members were to resign. In a letter, the Alavi Foundation’s president described how, a few days later, the Ambassador called the president and another board member to his office. The Ambassador said that “the Foundation from here on out is under the oversight of Haj Agha, not Mr. Rafighdoost [then the head of the Bonyad Mostazafan]. . . . [F]rom now on, the role of the Managing Director and the role of the Board of Directors will be just a formality and he [the Ambassador] will be conducting all of its [the Foundation’s] affairs.” The president of the Alavi Foundation then wrote a letter to the Ayatollah cautioning that although the Ambassador’s “appointment to a position of responsibility connected to the Foundation’s affairs presents enormous political, security, and economic dangers, we feel assured that the Supreme Leader has made this decision with discernment, unique insight, and a thorough knowledge of all pertaining aspects.” In July 1991, the president resigned his position and he was replaced that August by an individual who served as president until the summer of 2007.
In 1992, the Alavi Foundation’s new president met in New York and in Tehran with Bank Melli officials concerning $1.7 million in real estate taxes owed by 650 Fifth Avenue Company and $2.2 million in unpaid distributions owed by the partnership to Assa Corp. The Tehran meeting was attended by a Bank Melli board member, the head of Bank Melli’s Overseas Network Supervisory Department, the head of Bank Melli’s New York branch, and the head of Bank Melli’s Foreign Affairs. The head of the board of directors and managing director of Bank Melli forwarded the minutes of the Tehran meeting to the head of the Bonyad Mostazafan along with a cover letter stating, among other things, that “It is hoped that your firm instructions and the extra attention of the brothers from that esteemed Foundation, who are responsible for the Alavi Foundation of New York, will resolve the partnership’s mutual problems quickly . . . .”
Iranian Ambassadors to the U.N. continued to direct the affairs of the Alavi Foundation and to attend meetings of the Alavi Foundation board. In the late 1990s, two Bank Melli employees sought Ambassador Kharrazi’s permission for Assa Corp. to sell its interest in 650 Fifth Avenue Company. The Ambassador informed Bank Melli that the Building would be sold when the real estate market improved. Ambassador Seyed Mohammad Hadi Nejad Hosseinian, Kharrazi’s successor, originated the Alavi Foundation’s project funding formula. In 2004, Hosseinian’s successor told the Alavi Foundation to settle a lawsuit with a company controlled by a former Alavi Foundation president for $4 million.
In October 2007, Alavi Foundation board members met with the Ambassador and another former Iranian Government official to address issues relating to the Building’s management and Alavi’s charitable services. According to notes taken by a board member, the Ambassador stated, among other things, that it was necessary to increase the profit from the Building; the Ambassador was worried about Assa Corporation’s 40 percent share; the Foundation should only allocate to Shiites; and that the Ambassador would determine the composition of the board. The Ambassador ordered a study about the possibility of increasing the Foundation’s revenue and profit, stating that a business plan and comparative analysis had to be done. The Ambassador instructed: “I have to definitely see the proposed allocations before a final decision is reached. I have to be kept informed and I have to be able to state my opinion in order for you to make a decision.” The Ambassador told the board members that “[i]f there is an issue that needs to be conveyed to Tehran, let me know, I will convey it.”
The Original Complaint
On December 17, 2008, this Office filed a civil Complaint seeking forfeiture of the 40 percent interest held by Assa Corporation in 650 Fifth Avenue Company. In the Amended Complaint, the United States seeks to forfeit all right, title and interest in 650 Fifth Avenue Company, including the Alavi Foundation’s 60 percent interest in the company. The United States also seeks to forfeit the contents of bank accounts held by 650 Fifth Avenue Company, the Alavi Foundation, and Assa Corporation, as well as other real properties owned by the Alavi Foundation.
The Obstruction of Justice Allegations Against the Former President of the Alavi Foundation
On December 19, 2008, Farshid Jahedi, who at the time was the president of the Alavi Foundation, was arrested for obstruction of justice for allegedly destroying documents required to be produced under a grand jury subpoena concerning the Alavi Foundation’s relationship with Bank Melli and the ownership of the Building. Jahedi pled guilty in December 2009. On April 30, 2010, he was sentenced by U.S. District Judge Shira A. Scheindlin to three months in prison and ordered to pay a $3,000 fine.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation Division, the Joint Terrorism Task Force, and the Police Department of the City of New York. He also thanked the Counterterrorism Section of the Department of Justice National Security Division and the Manhattan District Attorney’s Office for their initiation and assistance in this case.
Assistant United States Attorneys Sharon Cohen Levin, Michael D. Lockard, Martin S. Bell, Carolina A. Fornos, and Special Assistant United States Attorney Anand Sithian are in charge of the civil forfeiture action.
In re 650 Fifth Avenue and Related Properties - Opinion and Order
Manager of Commodities Fund Sentenced to 30 MonthsRead the Press Release
SAN JOSE - Rodney Hatfield was sentenced late yesterday afternoon to 30 months in federal prison in connection with his role in a conspiracy to commit wire fraud, United States Attorney Melinda Haag announced.
Hatfield pled guilty to the charge on January 30, 2013. According to the plea agreement, Hatfield admitted that he conspired with his co-defendant to obtain money from investors by means of materially false representations about the value of their investment accounts. Mr. Hatfield admitted that he defrauded members of his own Jehovah’s Witness congregation in Watsonville, California. As part of the fraud scheme, he solicited millions of dollars in investment money from his fellow congregants and others to invest in Landmark Trading Company, LLC (“Landmark”). This company was set up as a holding company for the purpose of trading in foreign currency exchange by Hatfield and his co-defendant.
Initially, Landmark did engage in some legitimate currency trades on behalf of its investors; however, the company quickly began to run a negative return on its trading activity. Rather than accurately report this negative trading activity to investors, Hatfield and his co-defendant distributed false reports to investors in e-mails that their trading accounts were profitable and increasing in value. While some investors did receive all or most of their principal back, Hatfield admitted his actions resulted in a net loss to investors of more than $1 million.
The sentence was handed down by the Honorable Edward J. Davila, United States District Court Judge, following a guilty plea on the first count of the indictment, a violation of 18 U.S.C. § 1349. Judge Davila also sentenced the defendant to three years of supervised release following his term of imprisonment. Judge Davila did not impose a fine in light of the defendant’s financial circumstances. However, Judge Davila set a hearing for November 8, 2013, to determine the amount of restitution as well as set a reporting date for Hatfield to begin serving his sentence.
Timothy J. Lucey is the Assistant United States Attorney who is prosecuting the case with the assistance of Laurie Worthen. The prosecution is the result of a multi-year investigation by the United States Postal Inspection Service. The United States Attorney’s Office also wishes to recognize the assistance of the Commodities Future Trading Commission and the United States Trustee for the Northern District of California.
(Hatfield indictment )
(Hatfield plea agreement )
Man Indicted on Transmitting Threats in Interstate CommerceRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Keith Bowers, age 59, of Jessieville, Arkansas, was arrested today by agents of the Federal Bureau of Investigation in Arkansas based on an indictment returned in the United States District Court for the Middle District of Georgia on September 13, 2013, charging him with transmitting threats in interstate commerce.
The indictment alleges that Mr. Bowers made a threatening telephone call on August 16, 2012, from Texas to Carmike Cinemas’ headquarters in Columbus, Georgia. The indictment further alleges that this communication contained a threat to detonate an explosive device during a movie at one of Carmike’s movie theaters.If convicted, Mr. Bowers faces a maximum penalty of five (5) years imprisonment and a fine of $250,000.00.
The indictment is only an allegation and the accused is presumed innocent until and unless proven guilty.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Melvin E. Hyde, Jr.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Licensed Counselor Pleads Guilty to Health Care FraudRead the Press Release
Oklahoma City, Oklahoma – LEANN RICHARDSON, 48, of Edmond, Oklahoma, pled guilty today to health care fraud in connection with a scheme to bill Medicaid for behavioral counseling services never provided, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. The Medicaid Program provides federal and state funds to pay for health care benefits for individuals who cannot afford necessary medical expenses.
Richardson is a licensed professional counselor approved to bill the Oklahoma Health Care Authority ("OHCA") for behavioral counseling to Medicaid-eligible children. OHCA is the state government agency responsible for receiving, reviewing, and paying Medicaid claims. According to the Information filed in the case, Richardson fraudulently billed OHCA for purported therapy sessions with certain Medicaid beneficiaries twice per week, when she sometimes only saw the children once per week. The Information also alleged that Richardson took two personal trips to Colorado in 2010, but fraudulently billed OHCA for more than 80 behavioral counseling sessions with Medicaid-eligible children during those days when she was out of town. At today’s plea hearing, Richardson admitted that she caused bills to be submitted to Medicaid for counseling services not provided, including false claims for counseling when she was out of town.
Today, Richardson pled guilty to one count of health care fraud. Her punishment for the offense could be as much as ten years in prison, three years of supervised release, and a fine of $250,000. In a plea agreement, she also agrees to pay restitution for the amount of her false billing, to be determined by the court. Sentencing will take place in approximately ninety days.
This charge is the result of an investigation conducted by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services Office of the Inspector General, the Oklahoma Department of Health, and the Medicaid Fraud Control Unit of the Oklahoma Office of Attorney General. The case is being prosecuted by Assistant U.S. Attorney Chris M. Stephens.
Reference is made to court filings for further information.
KC Man Stops Trial, Pleads Guilty to Illegal Firearm, Faces at Least 15 Years in PrisonRead the Press Release
Project Ceasefire
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Kansas City, Mo., man stopped his trial and pleaded guilty in federal court today to illegally possessing a firearm.
Dennis T. Hart, 55, of Kansas City, pleaded guilty before U.S. District Judge Beth Phillips to being a felon in possession of a firearm. Today would have been the second day of Hart’s criminal jury trial on an April 23, 2013, federal indictment.
By pleading guilty today, Hart admitted that he was in possession of a Lorcin .380-caliber semi-automatic pistol on April 7, 2013. According to court documents, Kansas City police officers were dispatched to 29th and Prospect on a disturbance call at about 12:56 p.m. on that day. A man told police that Hart began yelling at him and punched him in the face. Hart then pulled up his sweater, revealing a pistol tucked in his waistband. The man, who was sitting in a vehicle, left and called the police.
Police officers located Hart a few blocks away. As officers approached Hart he began walking away and then started jogging away from the officers. Once the officers were able to catch up to Hart, they grabbed him and began placing him on the ground. As they were struggling, Hart leaned toward his left side and reached his right hand into his waistband. Hart pulled the loaded pistol from his waistband and raised his arm to chest level before falling to the ground, causing him to drop the pistol. Hart was then placed into handcuffs and taken into custody.
Under federal law, it is illegal for anyone who has been convicted of a felony to possess any firearm or ammunition. Hart has three prior felony convictions for possessing a controlled substance, two prior felony convictions for distributing a controlled substance, two prior felony convictions for assault, two prior felony convictions for forgery and prior felony convictions for tampering and fraud.
Under federal statutes, Hart is subject to a mandatory minimum sentence of 15 years in federal prison without parole. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Special Assistant U.S. Attorney Shalanda Smith. It was investigated by the Kansas City, Mo., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Project Ceasefire
Project Ceasefire, launched in October 1999, is a cooperative initiative by federal and local law enforcement and the Kansas City Crime Commission that targets for federal prosecution persons who unlawfully use or possess firearms.Jennifer Michael Swanson Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Helena, on September 16, 2013, before U.S. District Judge Sam E. Haddon, JENNIFER MICHAEL SWANSON, a 41-year-old resident of Billings, was sentenced to a term of:
- Prison: 48 months
- Special Assessment: $100
- Supervised Release: 4 years
SWANSON was sentenced in connection with his guilty plea to possession with the intent to distribute methamphetamine.
In an Offer of Proof filed by Assistant U.S. Attorneys Joseph E. Thaggard and Brendan P. McCarthy, the government stated it would have proved at trial the following:
On March 11, 2013, an Idaho State Police officer stopped a vehicle driven by an adult male in Power County, Idaho. SWANSON was a passenger in the vehicle. The male driver said he and SWANSON had driven from Billings to Nevada the previous day and were returning to Billings.
SWANSON and the male driver each admitted that cocaine and methamphetamine were in the car. A search of the vehicle ensued. The authorities found three bulk pounds of methamphetamine and a pound of cocaine in the vehicle. The officers also searched a purse located on the front passenger seat. The purse contained a syringe with liquid methamphetamine, a small amount of methamphetamine in several small plastic baggies, drug paraphernalia, and a .40 caliber handgun. The packaging of methamphetamine in several baggies is consistent with the intent to distribute the drug.
The male driver was interviewed by the Drug Enforcement Administration following his entry of a guilty plea in this matter. The male driver stated that, on March 10, 2013, he and SWANSON left Billings and went to Nevada. The male driver stated that he went on the trip to deliver money from another drug dealer in Billings to an associate drug dealer in Nevada. The male driver said that he did not expect that they would pick up any drugs in Nevada, but were provided the bulk quantities of methamphetamine and cocaine in Nevada and instructed to deliver the drugs to Billings. Those bulk quantities were among the drugs seized in Nevada.
The male driver said that the drug dealer in Billings requested that SWANSON go on the trip to Nevada with the male driver. The male driver said the drug dealer in Billings gave SWANSON two ounces of methamphetamine to go on the trip with the male driver. SWANSON possessed those ounces of methamphetamine at the time she and the male driver left Billings on March 10, 2013.
A DEA chemist analyzed the methamphetamine and cocaine seized by the authorities in Idaho. The bulk quantity of cocaine contained a detectable amount of cocaine and the bulk quantity of methamphetamine contained a detectable amount of methamphetamine.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that SWANSON will likely serve all of the time imposed by the court. In the federal system, SWANSON 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 Drug Enforcement Administration, Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Montana Division of Criminal Investigation.
International Bribery Schemes Uncovered Involving Hundreds of Millions of Dollars in Defense ContractsRead the Press Release
SAN DIEGO, CA – Three individuals – a commander in the United States Navy, a special agent for the Naval Criminal Investigative Service (NCIS) and the CEO of a multinational defense contractor – were charged in criminal complaints unsealed today in connection with two separate bribery schemes.
The complaints allege that Leonard Glenn Francis, the CEO of Singapore-based Glenn Defense Marine Asia Ltd. (GDMA), paid U.S. Navy Commander Michael Vannak Khem Misiewicz and NCIS Supervisory Special Agent John Bertrand Beliveau II with luxury travel and prostitutes in exchange for confidential information and other assistance in relation to hundreds of millions of dollars in Navy contracts.
Francis was arrested in San Diego yesterday evening and made his initial appearance in federal court this afternoon before U.S. Magistrate Judge Karen S. Crawford. Also yesterday, Misiewicz and Beliveau were arrested in Colorado and Virginia, respectively. The next date in the cases is a hearing set for Friday, September 20, 2013 at 9:30am before U.S. Magistrate Judge William McCurine Jr., in federal court in San Diego, to determine whether Francis should be detained as a flight risk and as a risk to obstruct justice. Francis will remain in custody without bond pending Friday’s hearing. The United States will seek the removal of Misiewicz and Beliveau to San Diego to face the charges.
U.S. Attorney Laura E. Duffy of the Southern District of California and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division made the announcement after the complaints were unsealed.
As set forth in the complaints, Francis, a Malaysian national who resides in Singapore, is the chief executive officer and president of Glenn Defense Marine Asia Ltd. (GDMA), a multi-national corporation with headquarters in Singapore and operating locations in other countries, including Japan, Singapore, Thailand, Malaysia, Korea, India, Hong Kong, Indonesia, Australia, Philippines, Sri Lanka and the United States. GDMA provides hundreds of millions of dollars in “husbanding” services to the U.S. Navy, which involves the coordinating, scheduling and procurement of items and services required by ships and submarines when they arrive at port. These services include, for example, providing tugboats and fenders; paying port authority and customs fees; furnishing security and transportation; supplying provisions, fuel and water; and removing trash and collecting liquid waste.
Misiewicz, 46, is a commander and captain-select in the U.S. Navy, assigned to U.S. Northern Command located at Peterson Air Force Base in Colorado Springs, Colo. Before this position, he served as the deputy operations officer for the U.S. Commander, Seventh Fleet aboard the USS Blue Ridge. The Seventh Fleet’s area of operations consists of 48 million square miles extending from Japan to Diego Garcia in the Indian Ocean and from Vladivostok, Russia, to Australia. As the deputy operations officer, Misiewicz had high-level exposure to the operational planning for ships in the Seventh Fleet and for any U.S. Navy ship traveling through the Seventh Fleet’s area of responsibility. He also held influence in determining or modifying the schedule of port visits for U.S. Navy vessels.
Beliveau, 44, is a supervisory special agent for NCIS at Quantico, Va. In that position, he has had access to the internal NCIS database containing investigative reporting, including reports into an investigation by NCIS into possible fraud committed by GDMA in billing the U.S. Navy under its contracts.
According to one of the criminal complaints, Misiewicz and Francis allegedly engaged in a conspiracy to commit bribery. As part of the conspiracy, Misiewicz sent to Francis information that the Navy had classified as “Confidential,” including schedules reflecting the movements of Navy ships months in advance. Misiewicz also operated as an advocate within the Navy for GDMA’s interests, urging decisions about port visits and contractor usage that were designed to benefit GDMA. In return, Francis provided Misiewicz with paid travel, luxury hotel stays and prostitution services. To communicate with Francis privately, Misiewicz set up a special personal email account with a name that included Francis’s initials.
As set forth in another complaint, Beliveau and Francis allegedly entered into a separate bribery conspiracy. As part of that conspiracy, Beliveau provided Francis with confidential information about the NCIS criminal fraud investigation into GDMA by secretly downloading reports from the NCIS database and conveying the information to Francis. Beliveau also allegedly provided Francis guidance as to how to deal with NCIS inquiries. In exchange, Francis provided Beliveau with, among other things, paid travel, luxury hotel stays and prostitution services.
Each defendant was charged with conspiring to commit bribery, which carries a maximum penalty of five years in prison. A criminal complaint is merely an allegation, and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.
This ongoing investigation is being conducted by NCIS, the Defense Criminal Investigative Service, the Defense Contract Audit Agency, and the Drug Enforcement Administration. The Criminal Division’s Office of International Affairs provided significant assistance in this matter, and the Royal Thai Police and the Corrupt Practices Investigation Bureau Singapore also provided law enforcement assistance. This case is being prosecuted by Assistant U.S. Attorneys Mark Pletcher and Robert Huie of the Southern District of California and Catherine Votaw, Director of Procurement Fraud for the Criminal Division’s Fraud Section.
Those with information relating to fraud, corruption or waste in government contracting should contact the NCIS anonymous tipline at www.ncis.navy.mil or call the DoD Hotline at (800) 424-9098.
DEFENDANTSCase Number: 13-MJ-3456
Leonard Glenn Francis
John Bertrand Beliveau IICase Number: 13-MJ-3457
SUMMARY OF CHARGES
Leonard Glenn Francis
Michael Vannak Khem MisiewiczCase Number: 13-MJ-3456
Conspiracy to Commit Bribery in violation of 18 U.S.C. § 371Case Number: 13-MJ-3457
INVESTIGATING AGENCIES
Conspiracy to Commit Bribery in violation of 18 U.S.C. § 371Defense Criminal Investigative Service
Naval Criminal Investigative Service
Homeland Security Investigations
Drug Enforcement AdministrationHospital Settles Federal AllegationsOf Medicare False ClaimsRead the Press Release
WICHITA, KAN.- Hutchinson Regional Medical Center, Inc., (formerly known as Promise Regional Medical Center – Hutchinson, Inc.) has agreed to pay $853,651 to the United States to settle allegations that the hospital submitted false claims to the Medicare program, U.S. Attorney Barry Grissom announced today. This payment is in addition to amounts the hospital previously refunded to the Medicare program for the claimed services. The payments to the United States total over $1.7 million.
The hospital also entered into a corporate integrity agreement with the United States Department of Health and Human Services, Office of Inspector General.
The settlement resolves allegations by the United States concerning the hospital’s claims to Medicare for hyperbaric oxygen wound therapy services. The procedure involves placing a patient’s entire body in a chamber of oxygen under increased atmospheric pressure. The United States contended that from March 23, 2007, through January 31, 2011, the hospital submitted claims to Medicare for hyperbaric oxygen wound therapy services that were not medically necessary or that lacked adequate documentation of medical necessity. The government also alleged that the claims resulted from kickback arrangements between the hospital, at least one of its physicians, and the company that supplied the chambers.
The hospital denied the allegations and, according to the terms of the agreement, the hospital does not admit any wrongdoing.
“Today’s settlement demonstrates our continuing commitment to protect the integrity of the Medicare program,” Grissom said. “ It is the latest example of how the Office of Inspector General for HHS and this office work hard together to assure appropriate care to beneficiaries and recover improperly paid funds.”
Grissom commended the Department of Health and Human Services, Inspector General, and Assistant U.S. Attorney Jon Fleenor for their work on the case.
Hermosa Woman Sentenced for Misprision of A FelonyRead the Press Release
United States Attorney Brendan V. Johnson announced that a Hermosa, South Dakota, woman convicted of Misprision of a Felony was sentenced on September 16, 2013, by U.S. District Judge Roberto A. Lange.
Doreen Amiotte, age 48, was sentenced to 24 months of probation, a $500 fine, and a $100 special assessment to the Federal Crime Victims Fund.
Amiotte was indicted by a federal grand jury on January 16, 2013, and pled guilty to Misprision of a Felony on May 31, 2013.
The conviction arose from an incident that took place on November 26, 2012, when Amiotte failed to report in a timely manner that a federal inmate, who was out on funeral furlough, could not be located. The inmate absconded from the funeral between 11 a.m. and 12 p.m. Amiotte did not report the escape until after 4:30 p.m.
The investigation was conducted by the U.S. Marshals Service. The case was prosecuted by Assistant U.S. Attorney Marie Ruettgers.
Gila River Tribal Member Sentenced to 18 Years for Second Degree MurderRead the Press Release
PHOENIX – On September 16, 2013, Charles Leo Thomas, 39, of Laveen, Ariz., an enrolled member of the Gila River Indian Community, was sentenced by U.S. District Judge G. Murray Snow to 18 years in federal prison, followed by a term of five years of supervised release. Thomas pleaded guilty to second degree murder on June 27, 2013.
According to court documents, on April 18, 2012, Thomas and two of his co-defendants, Manuel Bernell Moore and Delbert Monroe Thomas got into an altercation with the victim and struck the victim multiple times. Thomas grabbed a knife and stabbed the victim three times causing fatal injuries. Co-defendant Delbert Thomas was sentenced to 60 months in prison on August 12, 2013, after pleading guilty to accessory after the fact. Moore is awaiting trial.
The investigation in this case was conducted by the Gila River Police Department and the Federal Bureau of Investigation. The prosecution was handled by Christina J. Reid-Moore and Dimitra H. Sampson, Assistant U.S. Attorneys, District of Arizona, Phoenix.
CASE NUMBER: CR-12-1196-001-PHX-GMS
RELEASE NUMBER: 2013-072_ThomasFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Franklin Man Convicted of String of RobberiesRead the Press Release
NORFOLK, Va. – Steven V. Parker, 43, of Franklin, Va., pleaded guilty today to committing a string of bank robberies.
Kathleen M. Kahoe, Acting United States Attorney for the Eastern District of Virginia, and Royce E. Curtain, Special Agent in Charge of the Federal Bureau of Investigation’s Norfolk Office, made the announcement after the plea was accepted by United States District Judge Raymond A. Jackson. Parker was indicted on July 10, 2013, by a federal grand jury on seven charges of bank robbery. He faces a maximum penalty of 80 years imprisonment when he is sentenced on December 18, 2013.
In a Statement of Facts filed with the plea agreement, Parker admitted to his role in a string of bank and credit union robberies across multiple Tidewater cities. During each robbery, Parker concealed his identity with a different baseball hat and sunglasses. After entering each financial institution, Parker passed the teller a note demanding United States currency in large denominations and warning the teller not to activate any alarms or include a dye pack – a common anti-theft device – with the currency. Each teller complied. Parker then produced a dark blue zippered bank bag, placed the currency inside, retrieved his note, and left the bank. As Parker fled the scene of the last robbery in his string – on May 16, 2013 – law enforcement located him and took him into custody after a vehicular chase through multiple cities.
This case was investigated by the Federal Bureau of Investigation and the Chesapeake, Hampton, Isle of Wight, Newport News, Portsmouth, and Virginia Beach Police Departments. Assistant United States Attorney V. Kathleen Dougherty is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Founder of Investment Company Pleads Guilty in $21 Million Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that James C. Howard, III, 53, of Parkland, FL, the founder of Commodities Online LLC (COL), pled guilty yesterday for his participation in a $21 million investment fraud scheme.
Howard pled guilty before U.S. District Judge Ursula Ungaro to one count of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349. Sentencing is scheduled for December 2, 2013.
According to court documents, Howard conspired with co-defendants Patricia S. Saa, Louis N. Gallo, III, and Michael R. Casey to defraud individuals who invested in COL. From approximately January 2010 through April 2011, Howard and his co-conspirators used material false and fraudulent representations and material omissions to obtain over $21 million from over 700 investors.
According to court documents, Howard and his co-conspirators used COL to sell COL ownership units, subscriptions to the COL website, and investments in purported transactions to buy and sell commodities. After receiving the funds for the COL ownership units, Howard and Saa diverted a large part of those funds for other purposes. In addition to selling COL ownership units, Howard and his co-conspirators caused certain purported “pre-sold” commodities contracts to be offered for investment via the COL website, stating a pre-determined percentage return on investment and the number of days by when investors would be paid. Howard and his co-conspirators also represented to investors that COL had a track record of profits. However, COL did not have profits. Any payments made to investors were made using funds received from newer investors.
Also according to court documents, Howard and his co-conspirators also made material misrepresentations and omissions about the leaders of COL. After mid-2010, Howard and his co-conspirators represented that Howard was no longer President of COL and that co-defendant Casey, an attorney, was the President of COL. Howard and his co-conspirators represented that Howard was no longer managing COL, when in fact, Howard remained in charge. Also, Howard and his co-conspirators did not disclose to investors that both Howard and co-defendant Gallo had previously been convicted of federal felonies and that Gallo was still serving a term of supervised release.
Mr. Ferrer commended the investigative efforts of the FBI. This case is being prosecuted by Assistant U.S. Attorney Ana Maria Martinez.
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.
Former Vice President of Wells Fargo Advisors and Morgan Stanley & Co. Pleads Guilty in $1.8 Million Fraud SchemeRead the Press Release
SAN FRANCISCO – Adorean Boleancu pleaded guilty in federal court in San Francisco on September 13, 2013, to one count of wire fraud, United States Attorney Melinda Haag announced.
In pleading guilty, Boleancu, Vice President and Senior Financial Consultant in the Wealth Management Group of Wells Fargo Advisors, LLC., admitted to writing more than $1.8 million in checks on accounts of an elderly, widowed client for his personal benefit. He signed the victim’s name to checks drawn on the victim’s brokerage account and home equity lines of credit without the victim’s knowledge or authorization. The checks were payable to Boleancu’s family members, his girlfriend, another female acquaintance, cash, and financial companies where Boleancu had credit card accounts.
Boleancu, 47, of Napa, California, was indicted by a federal Grand jury on July 9, 2013. He was charged with 14 counts of bank fraud, in violation of 18 U.S.C. § 1344; 4 counts of wire fraud, in violation of 18 U.S.C. § 1343; 5 counts of money laundering, in violation of 18 U.S.C. § 1957; and 4 counts of aggravated identity theft, in violation of 18 U.S.C. § 1028A.
Boleancu is currently released on an $800,000 bond.
Boleancu’s sentencing hearing is scheduled for December 17, 2013, before the Honorable Richard Seeborg, U.S. District Court Judge, in San Francisco. The maximum statutory penalty for wire fraud, in violation of 18 U.S.C. § 1343, is 30 years and a fine of $1,000,000, plus restitution. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Robert S. Leach and Kyle F. Waldinger are the Assistant U.S. Attorneys who are prosecuting the case with the assistance of Rayneisha Booth and Mary Mallory. The prosecution is the result of an 18-month investigation by the Federal Bureau of Investigation.
(Boleancu indictment )
Former President of Searcy Closing Company Sentenced to 24 Months in Prison for Mail FraudRead the Press Release
Little Rock - Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas and Randall C. Coleman, Special Agent in Charge of the Federal Bureau of Investigation – Little Rock Field Office announced today that United States District Judge James M. Moody sentenced Marci Ann Ingram, age 41, of Searcy, to 24 months imprisonment followed by three years of supervised release for mail fraud related to Landmark Closing Company, Inc.
Thyer said, “When someone has defrauded the citizens of their community as blatantly as Ms. Ingram did, justice will reveal the truth and restore integrity. In this case, the request for an investigation came to the Arkansas Insurance Department whose investigators uncovered the ugly truth and brought it to the FBI for further investigation. As a result, Ms. Ingram is now facing the seriousness of her lack of veracity in her business practices.”
“Ms. Ingram betrayed those whose escrow accounts she held, and as a result, jeopardized their home ownership,” stated Coleman. “I appreciate the collective work of our agents, the Arkansas Insurance Department, and the United States Attorney who brought Ms. Ingram to justice for her actions.”
Ingram was charged by an Information and pled guilty to one count of mail fraud on April 12, 2013. The charges involve activities by Ingram as President and principal shareholder of Landmark Closing Company, Inc. (LCC) from 2006 through mid-2009.
During an investigation by the Arkansas Insurance Department – Criminal Investigation Division, evidence indicated that Ingram had been diverting money from an escrow account to other working accounts of LCC for personal use. As a result, the FBI was contacted to lead a federal investigation which resulted in the charge of mail fraud. According to the Information, “Ingram used some of these diverted escrow funds for her own personal use to pay for trips, Arkansas Razorback tickets, Netflix, iTunes, online gambling/gaming, clothing, makeup, country club dues, Facebook certificates and other non-business related expenditures.” In addition, Ingram used some of the escrow money to repay a personal loan from her parents. Checks issued to lienholders for legitimate payments from the escrow account were returned by the bank as insufficient due to a lack of funds. This caused Old Republic National Title Insurance Company, the company who insured the property titles for LCC, to pay $418,828.68 in claims and losses to lienholders.
Ingram pled guilty to a specific mail fraud charge of mailing an escrow check to Washington Mutual Payoff Unit, Jacksonville, Florida in the amount of $163,157.91 in June of 2009.
An Order for restitution will be issued separately at a later date after it is determined how much Ingram has repaid and how much restitution is still owed.
This investigation was conducted by the Federal Bureau of Investigation and the Arkansas Insurance Department-Criminal Investigation Division. Assistant United States Attorney Tricia Harris prosecuted this case for the United States
Former Police Officer Sentenced to 15 Years in Federal Prison and Fined $5,000 for Producing and Possessing Child PornographyRead the Press Release
FORT WORTH, Texas — Philip Woolery, a former officer with the Grapevine, Texas, Police Department, was sentenced today by U.S. District Judge Terry R. Means to 180 months (15 years) in federal prison and fined $5,000 following his guilty plea in March 2013 to an Information charging one count of production of child pornography and one count of possession of child pornography. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Woolery, 47, has been in custody since his arrest in October 2012 at his residence in Crowley, Texas, by U.S. Postal Inspectors during the execution of a federal search warrant. He admitted that in August 2011 he used his digital camera to record a minor male engaging in sexually explicit conduct in a swimming pool. In addition, Woolery admitted that in October 2012, he possessed a laptop computer that contained a sexually explicit image of a nude minor male and that he used that computer and the Internet to search for websites containing child pornography.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The case was investigated by the U.S. Postal Inspection Service. Assistant U.S. Attorney A. Saleem prosecuted.
Former Officer with Alvarado, Texas, Police Department Admits Leaking Law Enforcement Sensitive Information in Anabolic Steroid InvestigationRead the Press Release
DALLAS — Brent Dickey, 42, a former officer with the Alvarado, Texas, Police Department, appeared in federal court today and pleaded guilty to an Information charging one count of misprision of a felony. He faces a maximum statutory penalty of three years in federal prison and a $250,000 fine. Dickey, a resident of Burleson, Texas, will remain on bond pending sentencing, which is set for January 8, 2014, before U.S. District Judge Ed Kinkeade. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, in February 2010, Dickey was assigned to the Stop The Offender Program – Special Crimes Unit (STOP-SCU), a Johnson County law enforcement task force that investigated drug crimes occurring in the county. Dickey knew that a particular individual, Person A, was unlawfully distributing anabolic steroids, and he failed to make this felony known to some judge or other person in civil or military authority under the United States, such as a federal grand jury or an FBI agent.
On February 5, 2010, another STOP-SCU task force officer received information that Person A was unlawfully distributing anabolic steroids. This task force officer told Dickey that he planned to make a case against, and arrest, Person A. Unbeknownst to this task force officer, Person A had been supplying Dickey with anabolic steroids.
Two days later, Dickey went to Person A’s home and leaked this law enforcement sensitive information to Person A so that Person A would avoid getting caught, arrested or prosecuted for this felony drug offense.
The FBI and the Texas Ranger Division of the Texas Department of Public Safety are investigating. Deputy Criminal Chief Assistant U.S. Attorney Gary Tromblay and Assistant U.S. Attorney J. Mark Penley are in charge of the prosecution.
Former Ledyard Resident Sentenced to More Than Eight Years in Federal Prison for Child Pornography OffensesRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that MATTHEW WALLACE, 32, formerly of Ledyard, was sentenced today by Senior U.S. District Judge Warren W. Eginton in Bridgeport to 100 months of imprisonment, followed by five years of supervised release. On March 6, 2013, a jury found WALLACE guilty of one count of receiving child pornography and one count of possessing child pornography.
According to the evidence disclosed during the trial, on January 19, 2010, a Milford Police detective assigned to the Connecticut Child Exploitation Task Force logged into a peer-to-peer Internet file sharing network and downloaded several images of child pornography from an Internet Protocol (“IP”) address assigned to WALLACE at his Ledyard residence. On May 28, 2010, law enforcement agents conducted a court-authorized search of WALLACE’s residence and seized computers and hard drives. Forensic examination of the seized items revealed more than 500 images and videos of children, some as young as five years old, engaged in sexually explicit conduct.
WALLACE was arrested on December 16, 2010. He has been detained since March 13, 2013.
This matter was investigated by the Federal Bureau of Investigation and the Connecticut Child Exploitation Task Force, which includes federal, state and local law enforcement agencies, including the Milford Police Department. The Connecticut State Police and the Ledyard Police Department provided valuable assistance to the investigation. The case was prosecuted by Assistant United States Attorneys Neeraj Patel and Ray Miller.
The Connecticut Child Exploitation Task Force, which is housed at the main FBI office in New Haven, investigates crimes against children occurring over the Internet, and provides computer forensic review services for participating agencies. For more information about the Task Force, or to report child exploitation crimes, please contact the FBI at 203-777-6311.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Former Elizabethtown, Kentucky Business Operator Guilty in International Pyramid & “Ponzi” SchemeRead the Press Release
– Operated multiple businesses from Elizabethtown, Kentucky
LOUISVILLE, KY – The former owner of businesses operating in Hardin County, Kentucky pleaded guilty in United States District Court before District Judge John G. Heyburn II, today to charges of aiding and abetting with others in an illegal pyramid/ “Ponzi” scheme and engaging in a conspiracy to commit mail fraud, announced David J. Hale, United States Attorney for the Western District of Kentucky.
According to the plea agreement presented in court today, defendant Swainson Hawke, a/k/a Ronald D. Scheetz of Macon, Georgia defrauded numerous investors through his control of an operation of Guardian International Travel, LLC and related companies. Guardian International operated as both a “pyramid scheme” and a “Ponzi scheme” to defraud investors. Between February 1, 2005 and January 20, 2008 Hawke and co-defendant William A. Humes of Elizabethtown, Kentucky devised a scheme to defraud and to obtain money from participants in multi-level marketing schemes promising inflated returns. Through businesses they owned and controlled, including Guardian International Travel, LLC., Hawke admitted to inducing investors to purchase discount cards, ostensibly connected to the hospitality industry, creating the illusion that returns/payments were based on profits. In a Ponzi scheme, the fraud consists of paying funds received from new investors to previous investors in the guise of profits from the alleged business venture. Hawke assured returns on monies received from participants varying from 300% to 500%, to be paid in scheduled installments over periods of time ranging from 18 to 29 months.
In the furtherance of a pyramid scheme, defendant Hawke offered participants significant financial incentives to recruit new investors by paying them “commissions.” New investors paid Guardian International Travel and other companies owned and or operated by Hawke, for the right to financial rewards through recruiting new participants – a financial gain unrelated to the sale of a product.
Hawke and Humes were charged in a 2-count federal grand jury indictment that was unsealed Thursday, June 30, 2011.
If convicted, at trial, Hawke faced no more than 40 years in prison, a $500,000 fine, three years supervised release, as well as forfeiture to the United States Government, any and all property obtained as a result of the violations. Hawke is scheduled for sentencing before Judge Heyburn on January 7, 2014 at 2:00 pm in Louisville.
Defendant Humes is scheduled for trial in United States District Court, Louisville, before Judge Heyburn on January 14, 2014 at 10:00 am.
This case is being prosecuted by Assistant United States Attorney Bryan Calhoun, Special Assistant United States Attorney Jim Lesousky and was investigated by the Federal Bureau of Investigation (FBI) and the Kentucky Attorney General; Consumer Protection Division.
Former Bosnian Prison Guard Certified for Extradition to Bosnia-Herzegovina to Answer for Allegations of War CrimeRead the Press Release
Almaz Nezirovic is Wanted in Bosnia for War Crimes Against Civilians
ROANOKE, VIRGINIA – A former guard at the Rabic camp in Derventa Municipality of Bosnia and Herzegovina, who allegedly committed abuses against Serb civilians being detained at the camp, has been certified for extradition to Bosnia by a federal judge sitting in the United States District Court for the Western District of Virginia in Roanoke.
Almaz Nezirovic, 54, of Roanoke, Va., is wanted in Bosnia to stand trial on the charge of War Crimes Against Civilians, allegations that arise out of actions claimed to have occurred between April and July 1992 during the Bosnian War. In April 1992, Nezirovic joined a paramilitary group, the HVO, and became a prison guard. Bosnian officials charge that while serving as a prison guard, Nezirovic committed war crimes by beating, humiliating and traumatizing unarmed civilian prisoners, causing severe personal injury.
In July 2012, the United States, on behalf of the government of Bosnia, filed a complaint to extradite Nezirovic pursuant to an extradition treaty between the two countries that has been in place since 1901 and the United Nations Convention Against Torture. After several hearings before United States Magistrate Judge Robert S. Ballou, yesterday the court found sufficient evidence to sustain the allegation and certified the extradition request to the Secretary of State. Today’s ruling provides the legal basis for the Secretary of State to decide whether Nezirovic will be extradited to Bosnia, where war crimes charges are pending against him.
“Almaz Nezirovic stands charged with horrific acts of torture by the government of Bosnia and Herzegovina,” United States Attorney Timothy J. Heaphy said today. “Today’s ruling moves this matter one step closer to ultimate resolution in that country. Mr. Nezirovic can now be subject to extradition and surrender to his home country, where he will stand trial for these offenses.”
The investigation of the case was conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations, the Criminal Division of the Department of Justice and the Office of International Affairs. United States Attorney Timothy J. Heaphy and Assistant United States Attorney Elizabeth Wright are prosecuting the case for the United States.
Former Attorney Sentenced to More Than Eleven Years for Bank and Mail Fraud ConspiracyRead the Press Release
Tampa, Florida - U.S. District Judge Steven D. Merryday sentenced Mark W. Jackson (62), a former resident of Pinellas County and a former Florida attorney, to eleven years and three months in federal prison for bank and mail fraud conspiracy. The court also ordered Jackson to serve five years of supervised release, to pay restitution of $166,795.89, to pay a forfeiture money judgment of $200,000, and to pay a special assessment of $100.
Jackson pleaded guilty to the charge on August 28, 2008, but fled prior to being sentenced. He was a fugitive from February 17, 2009, until March 30, 2012 ,when he was arrested in North Carolina by local law enforcement authorities for committing offenses similar to those committed in the Middle District of Florida.
According to court documents and sentencing testimony, the conspiracy took place from a time prior to April 2000, and continued through July 2, 2004. As part of the conspiracy, Jackson and his co-conspirator William Wayne Dykstra stole mail matter containing personal information as well as personal and business checks from the United States mail. They then produced and used counterfeit personal identification documents, including unlawfully obtained copies of other individuals valid Florida driver licenses. They opened numerous accounts and rented mail boxes at Commercial Mail Receiving Agencies (CMRAs) using fraudulent identification documents. The pair also opened bank accounts in the names of others using stolen identification information. They produced counterfeit personal and business checks, deposited those checks into the fraudulently opened bank accounts, then withdrew funds from the accounts using ATMs. They also produced counterfeit personal and business checks based on checks stolen from the U.S. Mails, and then negotiated and attempted to negotiate the checks at drive-through teller windows of various bank branches throughout the Middle District of Florida using stolen or fraudulent identity documents. Jackson and Dykstra fraudulently obtained and attempted to obtain more than $200,000 from the compromised banks during the conspiracy.
Dykstra pleaded guilty to his role in the conspiracy in August 2008. On February 17, 2009, he was sentenced to two years and nine months in federal prison.
This case was investigated by the United States Postal Inspection Service. It was prosecuted by Senior Litigation Counsel Donald L. Hansen.
Federal Grand Jury in South Bend Returns IndictmentRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
South Bend, IN—The United States Attorney's Office announced that a Grand Jury sitting in South Bend, Indiana, returned the following Indictment on September 11, 2013:
Tyrone Franklin, 34, of Michigan City, Indiana, was charged in a four count Indictment with two counts of felon in possession of a firearm and/or ammunition and two counts of felon in possession of one or more firearms.These charges were filed as the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives.This case has been assigned to and will be prosecuted by Assistant United States Attorney Frank E. Schaffer.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
Ex-Read the Press Release
CLAY COUNTY SHERIFF PLEADS GUILTY TO FEDERAL WIRETAPPING CHARGE
Former Sheriff Miles Slack Secretly Intercepted Communications from Ex-Wife’s Supreme Court Computer
CHARLESTON, W. Va. – Former Clay County Sheriff Miles J. Slack pleaded guilty today to illegal wiretapping, a federal felony, U.S. Attorney Booth Goodwin announced. Appearing today in federal district court, Mr. Slack, who resigned as sheriff last Friday as part of his plea agreement with Goodwin, admitted to surreptitiously installing a keystroke logger on a computer belonging to the Supreme Court of Appeals of West Virginia.
The compromised computer was a government computer assigned to Mr. Slack’s then wife, Lisa Slack, who works in the office of a Clay County magistrate. Computers in the offices of circuit judges and magistrates throughout West Virginia are owned and maintained by the state’s Supreme Court, and are connected to a central Supreme Court computer network.
Mr. and Ms. Slack were in the midst of a divorce when he illegally tapped her computer. Mr. Slack admitted that he intended to monitor his ex-wife’s activity on the computer, including messages she sent through Internet chat and e-mail programs. He said he also wanted to capture his ex-wife’s usernames and passwords for various Internet services. Mr. Slack acknowledged that the wiretap device he installed captured everything that was typed on his ex-wife’s computer, including information about court business and the personal information of defendants in Clay County magistrate court.
Mr. Slack installed the hidden device in late April of this year and it remained in place for over two weeks.
“It’s a shame that Clay County’s chief law enforcement officer chose to illegally tap a government computer,” said U.S. Attorney Goodwin. “Our elected officials and law enforcement officers have to respect the law like everyone else. If they don’t, there are consequences.”“These days, it seems like every detail of our lives is being bounced around the world on computer networks,” Goodwin continued. “Imagine learning that someone was secretly monitoring everything you did on your own computer, without any legal authority. It’s a very serious breach of privacy. That’s why the laws against wiretapping are so important.”
Keystroke logging devices can be purchased from a number of Internet-based sellers. The devices, usually one to two inches long, are attached to a computer’s keyboard cable. Once installed, they can intercept everything typed on the keyboard, including email and information transmitted to Internet sites.
Because the devices are unobtrusive and normally hidden behind the computer targeted for surveillance, they can go undetected for long periods of time. Though small in size, some keystroke loggers can store two gigabytes of information, enough to record more than a billion keystrokes.Slack served as a Clay County deputy sheriff for around 16 years. In early 2012, while acting as chief deputy for the Clay County Sheriff’s Department, Slack announced he was running for sheriff. Then-Sheriff Randy Holcomb, however, quickly demoted Slack to the rank of sergeant, a move that threatened Slack’s election bid. Under West Virginia civil service laws, deputy sheriffs other than the chief deputy may not run for public office. In order to remain in the race, Slack resigned from the department and became Chief of Police for Clay, West Virginia, the county seat of Clay County.
In the May 2012 primary election, Slack soundly defeated two other candidates for the Democratic nomination for sheriff, receiving nearly 78% of the vote. He ran unopposed in the November 2012 general election and took office January 1, 2013. Slack’s first projects as sheriff included expanding evening patrols and seeking funding for a new home confinement officer.
The case is being investigated by the Federal Bureau of Investigation and the West Virginia State Police, with assistance from the Supreme Court of Appeals of West Virginia. The prosecution is being led by Counsel to the United States Attorney Steven Ruby.
Slack faces up to five years in prison when he is sentenced on December 19, 2013 by United States District Judge John T. Copenhaver, Jr.
Click here to view a copy of the plea agreement
District Man Sentenced to 28 ½ Years in PrisonRead the Press Release
For Sexually Abusing Stepdaughter and Other Crimes
-Defendant Also Violated Court Orders, Assaulted Police Officer With a Knife-
WASHINGTON – A 47-year-old man from Washington, D.C. was sentenced today to a prison term of 28 ½ years for sexually abusing his stepdaughter, sending letters and making phone calls to her and her mother in violation of court orders not to do so, unlawfully entering the family’s house after being ordered to stay away, and assaulting a police officer who had come to assist the family in the unlawful entry, U.S. Attorney Ronald C. Machen Jr. announced.
The defendant, who is not named here to protect the privacy of the victim, pled guilty to charges in June 2013 in the Superior Court of the District of Columbia. He pled guilty to first-degree child sexual abuse, attempted first-degree child sexual abuse, violating a civil protection order, criminal contempt, unlawful entry, and felony assault on a police officer. He was sentenced by the Honorable Patricia A. Broderick. Upon completion of his prison term, the defendant must register for 10 years as a sex offender.
The defendant is the ex-husband of the girl’s mother. At the plea hearing, he admitted that in the spring of 2012, when the victim was 14, he sexually abused the girl at their home in the District of Columbia. As a result of the sexual abuse, the victim became pregnant. The defendant told the victim to say that the baby’s father was a boy from school. Early this year, the victim revealed to her mother that the baby’s father was in fact the defendant. The victim further disclosed to law enforcement that the defendant had sexually abused her over a period of time beginning in at least 2010.
Early this year, the victim’s mother filed for and was granted a civil protection order from the defendant. On or about Feb. 5, 2013, he sent the victim’s mother a text message indicating that he knew who she was with. Alarmed that the defendant was nearby and watching her, the victim’s mother contacted the Metropolitan Police Department (MPD). Officers met her outside her house and went inside to make sure the defendant was not there. Two uniformed officers went into the basement. The defendant jumped out from beneath the stairway, brandished a knife, and stabbed one of the officers in the torso, cutting through his shirt and bullet-resistant vest. The defendant was placed under arrest. He later violated court orders by mailing a hand-written letter to the victim’s mother and calling the victim numerous times.
In announcing the sentence, U.S. Attorney Machen commended the work of the MPD, especially the detectives who led the investigation of the case. U.S. Attorney Machen also praised the work of Victim/Witness Advocates Shawn Slade and Veronica Vaughn, as well as Paralegal Specialist Jason Manuel. Finally, he commended Assistant U.S. Attorneys Amy H. Zubrensky and Jeff T. Cook, who investigated and prosecuted the case.
13-319Department of Justice Awards Hiring Grants to Support Southern District of California Law EnforcementRead the Press Release
Grants awarded to hire law enforcement positions
SAN DIEGO – The Department of Justice awarded grants totaling $925,235 to two cities in the Southern District of California, aimed at creating six new law enforcement positions, announced United States Attorney Laura E. Duffy.
The Department of Justice Community Oriented Policing Services (COPS) Hiring Program offers grants to state, local and tribal law enforcement agencies to hire or rehire community policing officers. The program provides salaries and benefits for officer and deputy hires for three years. Grantees for the 2013 hiring program were selected based on their fiscal needs, local crime rates, and community policing plans.
This year’s COPS grantees within the Southern District are the City of Brawley, located in Imperial County, will receive $425,235 and the City of Chula Vista, located in San Diego County, will receive $500,000.
U.S. Attorney Duffy noted that these grants will provide additional resources to address public safety in this District. We are pleased that the Department is recognizing and supporting the efforts of local law enforcement in Chula Vista and Brawley.
The COPS Office is responsible for advancing community policing nationwide. Since 1995, COPS has awarded over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 125,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.
Additional information about the 2013 COPS Hiring Program can be found on the COPS website at www.cops.usdoj.gov.
Department of Justice Awards Hiring Grants to Support Northern Disctrict of California Law EnforcementRead the Press Release
SAN FRANCISCO – The Department of Justice awarded grants totaling over $9 million to cities and counties in the Northern District of California, aimed at creating 30 new law enforcement positions, announced United States Attorney Melinda Haag.
The list of this year’s grantees within the Northern District of California includes Oakland, Alameda County, Hayward, East Palo Alto, Clearlake, Greenfield, Kings City, Marina, and Watsonville.
"The federal law enforcement agencies and U.S. Attorney's Office embrace the opportunity to work with local law enforcement to ensure the safety and security of the residents of the Northern District of California," said U.S. Attorney Melinda Haag. "The additional officers who will be hired as a result of these grants will bring much needed reinforcements to those cities and counties who can use them most. In particular, the City of Oakland and Alameda County will benefit from 18 new officers placed on the streets. The grants announced today are further building blocks that strengthen the partnerships among the federal, state, and local law enforcement organizations."
The Department of Justice Community Oriented Policing Services Service (COPS) Hiring Program offers grants to state, local and tribal law enforcement agencies to hire or rehire community policing officers. The program provides salaries and benefits for officer and deputy hires for three years. Grantees for the 2013 hiring program were selected based on their fiscal needs, local crime rates, and community policing plans.
The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has awarded over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 125,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.
Additional information about the 2013 COPS Hiring Program can be found on the COPS website at www.cops.usdoj.gov.
Crack Cocaine Trafficker Sentenced on Drug ChargesRead the Press Release
ROCHESTER, N.Y.–U.S. Attorney William J. Hochul, Jr. announced today that Cyle Krepps, a/k/a Black, a/k/a Trick, a/k/a Durell, a/k/a Dred, 26, of Rochester, N.Y., who was convicted of conspiracy to possess with intent to distribute and distribution of 280 grams or more of cocaine base and possession of a firearm in furtherance of a drug trafficking crime, was sentenced to 16 years in prison by U.S. District Judge Frank P. Geraci.
Assistant U.S. Attorney Robert A. Marangola, who handled the case, stated that between 2009 and 2011, Krepps processed cocaine into cocaine base which he then sold in various quantities and at different locations in the City of Rochester, including a house at 95 Friederich Park. On September 14, 2011, law enforcement officers arrested Krepps driving a rental vehicle after surveilling him leave 95 Friederich Park. The defendant had keys to the residence and over $2,200 in U.S. currency when he was arrested.
Officers then executed a search warrant at 95 Friederich Park, which was barricaded and monitored by an alarm system. Inside, officers seized a stolen, pistol-grip AR-15 style rifle chamber-loaded with seven rounds of live ammunition, a bag containing approximately two grams of cocaine base, a cell phone, and drug trafficking paraphernalia, which included scales for weighing drugs, empty bags for packaging drugs for sale, and dilutant to process drugs.
The conviction is the culmination of an investigation by members of the Violent Enforcement Suppression Team (“VEST”) of the Rochester Police Department, under the direction of Chief James Sheppard, the Greater Rochester Area Narcotics Enforcement team (“GRANET”), under the direction of Lieutenant Gerald Smith, and Special Agents of the Bureau of Alcohol Tobacco, Firearms and Explosives under the direction of Scott Heagney.Covington Man Indicted and Arraigned for Drug Distribution Causing DeathRead the Press Release
COVINGTON, KY - A Covington, KY., man has been arraigned on federal charges alleging that he sold a quantity of heroin to another individual who died as a result of using the drug.
On September 12, 2013, a federal grand jury in Covington returned a sealed indictment charging 28 year-old Timothy Tingle with distribution of heroin resulting in death. The indictment was unsealed Monday afternoon, following Tingle’s arrest. Tingle subsequently pleaded not guilty to the charges during his initial appearance in federal court. A trial date is set for November 25, 2013.
The indictment alleges that Tingle sold heroin, on or about April 20, 2013 in Kenton County, and that the person who purchased it died from an overdose as a result of using the heroin.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, and Robert L. Corso, Special Agent in Charge, Drug Enforcement Administration, jointly announced the indictment and arraignment.
The investigation preceding the indictment was conducted by the Drug Enforcement Administration and the Taylor Mill Police Department. The indictment was presented to the grand jury by Assistant U.S. Attorney Anthony Bracke.
Tingle’s next court appearance is scheduled for September 19, 2013 at 1:30 p.m. If convicted, Tingle faces a minimum of 20 years and up to life in prison, a maximum fine of $1,000,000, and at least 3 years of supervised release. However, any sentence following a conviction would be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes.
An indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which government must prove guilt beyond a reasonable doubt.
Cleveland Woman Sentenced to 16 Months in Prison for Theft of $41,000 in Government BenefitsRead the Press Release
A Cleveland woman was sentenced to 16 months in prison for the theft of more than $41,000 in government benefits, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
India N. Parker, 37, will serve her federal sentence after serving a sentence in state prison related to offenses against a human corpse, tampering with evidence and criminal mischief.
Parker pleaded guilty earlier this year in U.S. District Court to two counts of theft of government property and five counts of making false statements.
Parker’s five-year-old daughter died in late 2006. Parker left the child’s remains to decay before putting the body in a trash bag and then in a garbage can in her front yard. A garbage truck then picked up and disposed of the child’s body. The body was never found, according to court documents.
After the child’s death, Parker lied about her daughter’s whereabouts to friends, family and investigators. While she disposed of the body, Parker stole and converted to her own use $40,236 in Social Security payments made to her daughter and $1,393 in food stamp benefits, according to court documents.
She also made false statements to agency representatives by stating that her daughter had been living with her when, in fact, Parker knew that her daughter was deceased during the relevant time frames, according to court documents.
The case was prosecuted by Assistant U.S. Attorney Phillip J. Tripi, following investigation by agents of the Social Security Administration Office of Inspector General.
Chairman of the Board of the Paideia Academy/Employee of St. Louis City Treasurer's Office Sentenced on Fraud ChargesRead the Press Release
St. Louis, MO – FRED W. ROBINSON was sentenced to 24 months in prison on multiple fraud charges involving his submission of false time sheets in the Treasurer’s Office and his diversion of federal and state education funds from the Paideia Academy Charter School. The Judge also ordered restitution of $419,333.
Robinson was the Chairman of the Board of Trustees for Paideia Academy, a Missouri charter school for kindergarten through eighth grade. He maintained an office in the school’s administration building and was involved in the day-to-day management and administration of the school. Paideia was tuition free and funded by federal and Missouri education funds intended for legitimate school operations.
According to testimony presented at trial, during 2009 and 2010, Robinson diverted approximately $242,333 of Paideia Academy funds for the purchase, construction, renovation and rehabilitation of a building at 4028 West Florissant Avenue in St. Louis for the purpose of developing and operating a Little People’s Academy day care center to be operated by Robinson and an associate through Paige C. Investments, LLC, in which Robinson had an ownership and financial interest. Robinson failed to disclose his ownership and financial interest in the proposed day care center to the Paideia Academy Board of Trustees. Robinson’s partner in the proposed day care center was a friend and associate of Robinson who worked as a bartender at a lounge frequented by Robinson, and who had no background, experience or training in early childhood education or the operations of a day care center.
Additionally, during each year from 2006 through 2010, as an employee of the Treasurer’s Office for the City of St. Louis, Robinson submitted false weekly time sheets falsely certifying work hours and was paid approximately $35,360 each year in salary based upon those false time sheets.
Robinson, St. Louis, Missouri, was convicted in March of one count of wire fraud and seven felony counts of federal program theft after a seven-day trial before United States District Judge Audrey G. Fleissig.
Other defendants that have been charged as part of the investigation are Dannielle Benson and Frank Habeebullah, both of whom plead guilty late last year.
This case was investigated by the Federal Bureau of Investigation and the United States Department of Education-Inspector General’s Office. Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney’s Office.Cattle Ranch Owner Pleads Guilty to $150,000 Social Security Disability FraudRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Leeton, Mo., man has pleaded guilty in federal court to receiving nearly $150,000 in federal disability benefits while he owned and operated a cattle ranch.
Allan Dalton, 55, of Leeton, waived his right to a grand jury and pleaded guilty before U.S. Chief District Judge Fernando J. Gaitan on Monday, Sept. 16, 2013, to a federal information that charges him with theft of government money.
According to the plea agreement, Dalton concealed his work activity from the Social Security Administration as part of a scheme to fraudulently obtain a total of $147,070 in disability payments.
Dalton applied for disability benefits in October 1999 and was determined in August 2000 to be medically disabled and unable to work due to rotator cuff injuries.
Dalton began operating his cattle ranch as early as 1999. Based on the information SSA discovered during its investigation, by June 2004, Dalton’s work activity at the ranch was substantial and precluded him from receiving Social Security disability payments. Between June 2004 and June 2011, Dalton took out numerous loans for his cattle operation. For example, in October 2007, Dalton paid over $100,000 for cattle, and in March 2008, he paid over $70,000 for cattle. Loan documents from this time period showed that Dalton owned significant assets, including livestock, land and farm equipment. Today, Dalton admitted that he willfully failed to timely disclose his work activity at his ranch to SSA because he wanted to continue to receive Title II disability payments that he was not entitled to receive.
In addition to the disability payments, Dalton fraudulently obtained a $250 economic stimulus payment under the American Recovery and Reinvestment Act of 2009. This payment was made contingent on Dalton’s eligibility to receive Social Security disability payments. Pursuant to the plea agreement, Dalton agreed that he caused a loss to the government totaling $147,320.
Under federal statutes, Dalton is subject to a sentence of up to 10 years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Special Assistant U.S. Attorney Trey Alford. It was investigated by the Social Security Administration – Office of Inspector General.California Man Sentenced to Prison for Federal MarijuanaRead the Press Release
Trafficking Charges
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a California man was sentenced today by United States District Judge Robert D. Mariani to serve 48 months in prison on the charge of conspiracy to distribute marijuana.
According to United States Attorney Peter J. Smith, Karl Aspinall, age 38, of Los Angeles, California, admitted to participating in a marijuana trafficking ring which obtained marijuana from medical marijuana dispensaries and other sources in California, transported the marijuana to Pennsylvania, and distributed it to street level dealers and customers in the Lackawanna County area.
In addition to the prison term, Judge Mariani also ordered that Aspinall be supervised by a probation officer for two years following his prison sentence.
The investigation was conducted by the Federal Bureau of Investigations Safe Streets Task Force and the Scranton Police Department.
The case was prosecuted by Assistant United States Attorney Robert J. O’Hara.
****Arkansas Man Found Guilty of Crack Cocaine ConspiracyRead the Press Release
A man who conspired to distribute crack cocaine was convicted by a jury September 11, 2013, after a three-day trial in federal court in Sioux City.
Jeffery Thompson, 39, originally from Osceola, Arkansas, but residing in Sioux City, Iowa, was convicted of one count of conspiring to distribute crack cocaine and one count of distributing crack cocaine. The verdict was returned following about three hours of jury deliberations.
The evidence at trial showed Thompson was involved in a conspiracy from about 2008 and continuing through about 2011 that distributed 280 grams or more of crack cocaine. Evidence also showed that on or about June 18, 2010, in Sioux City, Iowa, Thompson distributed crack cocaine to an individual cooperating with law enforcement. Thompson has been previously convicted of four prior felony drug offenses from 2001 to 2013.
Sentencing before United States District Court Judge Mark W. Bennett will be set after a presentence report is prepared. Thompson remains in custody of the United States Marshal pending sentencing. On the conspiracy conviction, Thompson faces a mandatory minimum sentence of life imprisonment and a possible maximum sentence of a $20,000,000 fine, a special assessment of $100. On the distribution conviction, he faces the following maximum penalties, up to 30 years’ imprisonment without the possibility of parole; a fine of not more than $2,000,000; a mandatory special assessment of $100; and a term of supervised release of at six years to life.
The case is being prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 12-4081.
Appeals Court Upholds Constitutionality of New Jersey Sports Betting BanRead the Press Release
NEWARK, N.J. – The United States Court of Appeals for the Third Circuit issued a precedential opinion today upholding a federal statute that prevents the state of New Jersey from legalizing sports betting in its casinos and racetracks.
The opinion concludes that professional sports leagues have standing to sue to stop the spread of state-sponsored sports gambling – as provided by the 1992 federal Professional and Amateur Sports Protection Act (PASPA) – and that the act itself is constitutional.
The United States of America intervened in the matter to defend the constitutionality of PASPA. New Jersey U.S. Attorney Fishman argued the United States’ position before the District Court and the Third Circuit Court of Appeals.
“We are gratified that the Court of Appeals agreed with the United States’ position that Congress acted constitutionally when it enacted PASPA,” said U.S. Attorney Fishman. “The government’s argument was not whether sports gambling should be legalized or is good policy. The government argued and the Court of Appeals agreed that Congress had the constitutional authority to make uniform national policy and not to leave it to the decisions of individual states.”
On Aug. 7, 2012, the National Collegiate Athletic Association, the National Basketball Association, the National Football League, the National Hockey League and Major League Baseball filed suit against New Jersey’s governor, director of the Division of Gaming Enforcement, and executive director of the Racing Commission after New Jersey amended its constitution. The amendment permitted the legislature to legalize, with limited exceptions, wagering at casinos and racetracks throughout the state on the results of professional, college and amateur sports.
The Sports Leagues’ suit sought to enjoin the implementation of state-sponsored gambling in New Jersey. U.S. District Judge Michael A. Shipp found that the Sports Leagues had standing to bring their action, rejected constitutional challenges to PASPA and entered judgment against New Jersey. Today’s decision by the Third Circuit Court of Appeals affirmed the District Court’s judgment.13-376
Anchorage Felon sentenced to 150 months in prison for gun and drug possession and assaulting a Federal AgentRead the Press Release
Anchorage, Alaska -Acting U.S. Attorney Kevin Feldis announced today that an Anchorage man was sentenced in an Anchorage federal court after pleading guilty to multiple counts of weapons possession, one count of possession of cocaine, and one count of assaulting a federal law enforcement officer.
Lamar Joseph Facine, 30, of Anchorage, Alaska, was sentenced yesterday by Chief U.S. District Court Judge Ralph R. Beistline to 150 months in prison, to be followed by a three year term of supervised release. Facine, already a convicted felon, previously pled guilty to two counts of being a felon in possession of a firearm as well as one count of cocaine possession and one count of assaulting a federal agent.
According to Assistant U.S. Attorney Stephanie Courter, who prosecuted the case, Facine admitted to possessing three separate firearms – two handguns and a shotgun – after having previously been convicted of two counts of felony drug distribution. He also possessed a bag containing powder cocaine, additional rounds of ammunition, and other items of drug paraphernalia. When Facine was confronted by law enforcement in October 2012, he immediately began to fight the officers, ultimately striking one agent in the face.
In announcing the sentence, Judge Beistline noted that Facine was clearly dangerous and had earned the punishment ordered by the court. Judge Beistline also noted that Facine’s actions demonstrated a lack of respect for law enforcement and for those in positions of authority; therefore, it was important to fashion a sentence that focused on deterrence and protection of the public.
Mr. Feldis commended the Bureau of Alcohol, Tobacco, Firearms, and Explosives as well as the United States Probation and Pretrial Services Office for their investigation of this case.
Algona Man Pleads Guilty to Meth ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine pled guilty September 6, 2013, in federal court in Sioux City.
Ryan Hansen, 32, from Algona, Iowa, was convicted of conspiring to distribute methamphetamine.
At the plea hearing, Hansen admitted his involvement from September 2012 through March 2013 in a conspiracy that distributed at least 500 grams of actual (pure) methamphetamine. Hansen admitted to obtaining ounces of methamphetamine in Minnesota on multiple occasions and distributing it in Iowa. On March 16, 2013, law enforcement conducted a traffic stop of the vehicle Hansen was driving. Officers located and seized several bags of “ice” methamphetamine totaling 14.76 grams of actual (pure) methamphetamine. Hansen admitted he had traveled to Minnesota to obtain the methamphetamine, transported it back to Iowa and sold some of the methamphetamine in the Mason City area prior to being stopped by law enforcement.
Sentencing before United States District Court Judge Mark W. Bennett will be set after a presentence report is prepared. Hansen remains in custody of the United States Marshal pending sentencing. Hansen faces a mandatory minimum sentence of 20 years’ imprisonment and a possible maximum sentence of life imprisonment, a $20,000,000 fine, a $100 special assessment, and ten years up to life of supervised release following any imprisonment.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Kossuth County Sheriff’s Office, and the Iowa DCI Criminalistics Laboratory.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-3010.Alabama Man Indicted for Mutli-Year Stolen Identity Refund Fraud ConspiracyRead the Press Release
Montgomery, Alabama - A federal grand jury returned an indictment charging Nakia Jackson with conspiracy to file false tax returns, theft of public funds, and aggravated identity theft, announced Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division and U.S. Attorney for the Middle District of Alabama George L. Beck Jr.
According to the indictment, between January 2009 and March 2011, Jackson conspired with several individuals to file false tax returns using stolen identities. Jackson obtained many of the stolen identities from a state employee. He used those identities to file false tax returns and directed the tax refunds to several bank accounts. Jackson recruited individuals to open up bank accounts to receive the false refunds and directed them to withdrawal the false refund money. To assist in his conspiracy, Jackson recruited a bank teller to facilitate to deposit and withdrawal of the fraudulent tax refunds.
An indictment merely alleges that crimes have been committed and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Jackson faces a maximum potential sentence of 10 years in prison for the charge of conspiracy to defraud the United States and for each of the theft of government money counts, and a mandatory 2-year sentence for the aggravated identity theft counts. He is also subject to forfeiture, fines and mandatory restitution if convicted.
This case was investigated by special agents of IRS - Criminal Investigation. Trial Attorneys Charles M. Edgar, Jr. and Michael Boteler of the Justice Department’s Tax Division are prosecuting the case.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617ADA Consent Decree Entered Between Department of Justice and Local RestaurantRead the Press Release
Kenyen R. Brown, United States Attorney for the Southern District of Alabama, announces the successful investigation and resolution of a complaint made by a person with disabilities who, like many others, could not access a local restaurant. Today, the federal district court entered a Consent Decree between the Department of Justice and the owners and operators of Cotton’s Restaurant in Orange Beach, Alabama.
When retiree Roland Barbier, Sr. of Mississippi was vacationing in Orange Beach, Alabama in 2010, he and his family heard of a place with a reputation for great seafood dining. Because he was a person with disabilities who used an assistive device (a walker), he attempted to enter Cotton’s Restaurant but was prevented from doing so because of the number of steps and stairs involved. There was no ramp, no chair lift, nor any elevator. While his family members could access and enjoy the beautiful views of the Gulf of Mexico from the dining room and the food served there, he could not. As a result, the entire family wishing to dine there was forced to leave and to find another, accessible restaurant. Mr. Barbier was representative of many persons with disabilities who could not access the restaurant.
A notice of complaint (based upon an alleged violation of the Americans with Disabilities Act [ADA]) and initiation of the investigation was issued to Cotton’s Restaurant by the Civil Rights Enforcement Unit of the U. S. Attorney’s Office, led by Assistant United States Attorney Gary Alan Moore. Following investigation, negotiation, and architectural design, the parties were able to agree on required changes that would be made to the facility including: adding accessible parking for persons with disabilities, adding an appropriate ramp to a chair lift which was installed and which would be used for persons who have trouble walking, who use wheelchairs, walkers and the like. Because neither of the restrooms at the restaurant was accessible, the management of Cotton’s remedied that violation by building a new accessible restroom for females and by converting the previous men and women’s restrooms into a single, accessible restroom for males. In addition, some dining tables of a height that will allow those who use a wheelchair have been added and a required number will also have gulf view-locations. Policies have been adopted by the owners and staff which require providing dining assistance to persons who are deaf, hard of hearing, blind and deaf-blind, blind, and people with mobility disabilities who may not be able to access the raised bar in the lounge. Service dog policies have also been adopted. Staff training is also required as part of the Consent Decree’s requirements.
As Mr. Brown continued, “Although there was not an immediate positive response, Cotton’s Restaurant owners quickly chose to do the appropriate thing to remove the barriers which prevented persons with disabilities from enjoying their restaurant. Certainly, nothing says you are welcome to a place of business like a person actually being able to enter and enjoy that place of business. It’s the law and many folks join us in saying it’s also simply great for business. We commend Cotton’s Restaurant’s owners for their decisions and their wise investment. They have shown they are good corporate neighbors. With more than 55 million persons with disabilities in our country, the restaurant has the potential for much more business as well.
“Because Cotton’s Restaurant soon cooperated and agreed to make the substantial changes required, the Department of Justice did not seek civil monetary penalties provided for in the ADA. That is a rare situation. Also, Mr. Barbier was not interested in monetary damages, to which he was entitled. He simply wanted the problem remedied for others who might want the same dining experience as persons who do not have disabilities. When he was shown photographs of the renovations taking place to make the restaurant accessible, Mr. Barbier was very pleased and said that at his age, he may not be able to visit the Gulf area again. Sadly, he passed away a few weeks ago. He was a good neighbor who certainly cared for others.
“I want to be clear on behalf of the United States, however, that if business owners or governmental entities do not cooperate with our compliance efforts on behalf of persons with disabilities, we intend to seek the full measure of relief allowed under the ADA in terms of injunctive relief to effect structural changes to make them accessible and we will seek civil monetary penalties and compensatory damages on behalf of the victims,” concluded Mr. Brown.
“In late July we celebrated the 23rd Anniversary of the enactment of the Americans with Disabilities Act,” observed AUSA Moore. He continued, “Even though many buildings and facilities pre-date the 1990 statute, owners and operators of facilities and businesses and of state and local governmental services still must perform renovations or effect changes which are readily achievable to remove barriers to access to persons with disabilities. For more information, visit www.ada.gov or our office’s website at http://www.justice.gov/usao/als/civil/cre.html”.
The Civil Rights Enforcement Unit team consisted of AUSA Moore, Paralegal Regina Dickerson, Investigator Richard Hinrichs, and Independent Architectural Consultant Bill Hecker of Birmingham, AL.
Any person with a disability who believes they have been discriminated against in the Southern District of Alabama may contact our office at 63 South Royal Street, Suite 600, Mobile, AL 36602, telephone us at 251.441.5845 or file a complaint with the U. S. Department of Justice, 950 Pennsylvania Avenue, NW, Civil Rights Division, Disability Rights Section, Washington, DC 20530.
Monday 16 September 2013
“No Show” Doctor Sentenced to 151 Months in Prison in Connection with $77 Million Medicare Fraud SchemeRead the Press Release
Gustave Drivas, M.D., 58, of Staten Island, N.Y., was sentenced to serve 151 months in prison for his role as a “no show” doctor in a $77 million Medicare fraud scheme. The State of New York revoked Dr. Drivas’s medical license earlier this year.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Loretta E. Lynch of the Eastern District of New York, Assistant Director in Charge George Venizelos of the FBI’s New York Field Office and Special Agent in Charge Thomas O’Donnell of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) made the announcement.
Drivas was convicted by a jury on April 8, 2013, of health care fraud conspiracy and health care fraud after a seven-week trial. He was acquitted of kickback conspiracy. Including Drivas, 13 individuals have been convicted of participating in the massive fraud scheme, either through guilty pleas or trial convictions. In addition to the prison term, U.S. District Judge Nina Gershon of the Eastern District of New York sentenced Drivas to three years of supervised release with a concurrent exclusion from Medicare, Medicaid and all Federal health programs, ordered him to forfeit $511,000 and ordered him to pay restitution in the amount of $50.9 million.
The evidence at trial showed that Drivas knowingly authorized his co-conspirators at a Brooklyn medical clinic to use his Medicare billing number to charge Medicare for more than $20 million in medical procedures and services that were never performed. In return, he received more than $500,000 for his role in the scheme. According to court documents, from 2005 to 2010, Drivas was the medical director of or a rendering physician at a clinic in Brooklyn that billed Medicare under three corporate names: Bay Medical Care PC, SVS Wellcare Medical PLLC and SZS Medical Care PLLC (collectively “Bay Medical clinic”). The evidence established that Drivas was a “no show” doctor, who almost never visited the clinic except to pick up his check. The evidence also showed that the clinic paid cash kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for more than $77 million in services that were medically unnecessary and never provided.
The government’s investigation included the use of a court-ordered audio/video recording device hidden in a room at the clinic in which the conspirators paid cash kickbacks to corrupt Medicare beneficiaries. The conspirators were recorded paying approximately $500,000 in cash kickbacks during a period of approximately six weeks from April to June 2010. This room was marked “PRIVATE” and featured a Soviet-era poster of a woman with a finger to her lips and the words “Don’t Gossip” in Russian. The purpose of the kickbacks was to induce the beneficiaries to receive unnecessary medical services or to stay silent when services not provided to the patients were billed to Medicare.
To generate the large amounts of cash needed to pay the patients, Drivas’s business partners and co-conspirators recruited a network of external money launderers who cashed checks for the clinic. Clinic owners wrote clinic checks payable to various shell companies controlled by the money launderers. These checks did not represent payment for any legitimate service at or for the Bay Medical clinic, but rather were written to launder the clinic’s fraudulently obtained health care proceeds. The money launderers cashed these checks and provided the cash back to the clinic. Clinic employees used the cash to pay illegal cash kickbacks to the Bay Medical clinic’s purported patients.
This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York. The case is being prosecuted by Trial Attorney Sarah M. Hall of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys William C. Campos and Shannon C. Jones of the Eastern District of New York.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Wichita Tax Preparer Sentenced for Filing False Tax ReturnsRead the Press Release
WICHITA, KAN. - A Wichita tax preparer has been sentenced to 36 months on federal probation for filing false tax returns, U.S. Attorney Barry Grissom said today.
Lata L. Tomlinson, 34, Wichita, Kan., was convicted in a jury trial in April on 19 counts of preparing false income tax returns for a total of 17 people during tax years 2007, 2008 and 2009.
During trial, prosecutors presented evidence that Tomlinson had a college degree in accounting and worked for various tax preparation companies before starting her own business in 2006 called Talking Taxes And More.
In tax returns she prepared, she falsely stated deductions for depreciation, home improvements, business repairs, contract labor, legal fees, home repairs, medical expenses, advertising, insurance, car and truck expenses, hay and grain expenses, cell phones and care of dependents.
Grissom commended IRS – Criminal Investigation, Assistant U.S. Attorney Matt Treaster and Assistant U.S. Attorney Jason Hart for their work on the case.U.S. Attorney’s Office Announces Settlement of Claims Against Private Prisoner Transport Company for Violation of Jeanna’s ActRead the Press Release
BISMARCK- U.S. Attorney Timothy Purdon announced the settlement of the United States’ civil claims against private prisoner transport company Extradition Transport of America, L.L.C. (ETA). The United States had sued ETA alleging violations of the Interstate Transportation of Dangerous Criminals Act of 2000 (also known as “Jeanna’s Act”) relating to the October 2011 escape of Joseph M. Megna from ETA’s custody at the Oriska Rest Area along Interstate 94 in North Dakota. This suit was the first ever filed under Jeanna’s Act and sought restitution and civil penalties based on the escape of a prisoner froma private prisoner transport company.
Under the terms of the settlement, ETA has agreed to reimburse state, federal, and local law enforcement authorities approximately $70,000 for expenses relating to the re-capture of Megna. In addition, ETA will pay a $10,000 civil monetary penalty, the maximum penalty allowed for a violation of Jeanna’s Act, to the United States. A Consent to Entry of Judgment signed by ETA owner Billy G. Taylor, and
summarizing the terms of the settlement was filed today in United States of America v. Extradition Transport of America, L.L.C., United States District Court, District of North Dakota, Case No. 3:12-CV-0046.In Bismarck, U.S. Attorney Timothy Purdon said, “This groundbreaking lawsuit should send a clear message to the prisoner transport industry: follow the rules and keep the dangerous prisoners in your custody secure or face severe financial penalties under Jeanna’s Act.” U.S. Attorney Purdon added, “I also want to recognize the efforts of our Civil Division in producing this outstanding result. The dedicated men and women of our Civil Division don’t always get the recognition of our criminal prosecutors, but they too work hard and produce great results for the citizens of North Dakota and the United States.”
On October 4, 2011, ETA’s employees were transporting Megna and six other prisoners through North Dakota in a van. ETA was to transport Megna from Florida to Washington to face a felony charge of child molestation in the first degree. At the time of the escape, Megna was a registered sex offender with prior criminal convictions in Washington. Of those seven prisoners, six, including Megna, were considered “violent prisoners.” ETA’s van stopped at the Oriska Rest Area in Barnes County to allow the prisoners to use the restroom. Megna later told authorities that he used a bobby pin found on the floor of the ETA van to pick the locks on his handcuffs, waist chain and leg irons. In addition to failing to detect that Megna was not properly restrained, the ETA employees left Megna and one other prisoner unattended, with the transport van door unlocked. Megna seized the opportunity to escape from the van and flee into a cornfield north of the interstate.
Approximately 60 law enforcement personnel from 14 state, federal, and local agencies were mobilized and spent 22 hours containing the area and searching for Megna, using aircraft and other specialized equipment. Megna was captured the next day, but only after the Barnes County Sheriff formed a posse of local farmers to harvest the corn in which Megna was hiding, flushing him out. During this “harvest,” armed law enforcement officers were stationed on the farmers’ combines to protect the farmers operating the machinery.
Barnes County Sheriff Randy McClaflin said, “I would like to extend a well-deserved ‘Thank You’ to all law enforcement agencies that participated in capturing Megna. This successful effort shows the great cooperation and dedication of North Dakota law enforcement officers.” Sheriff McClaflin also expressed his appreciation for the help the officers received from the surrounding communities, particularly the local farmers who teamed up to harvest the cornfield in which Megna was hiding. “These folks were instrumental in apprehending Megna without any further delays,” Sheriff McClaflin said.
Law enforcement agencies participating in the operation included Barnes County Sheriff’s Office, Cass County Sheriff’s Office, Jamestown Police Department, Valley City Police Department, West Fargo Police Department, Fargo Police Department, Moorhead Police Department, North Dakota Bureau of Criminal Investigation, North Dakota Game and Fish Department, North Dakota Highway Patrol, U.S. Customs and Border Protection, U.S. Fish & Wildlife Service, Bureau of Alcohol, Tobacco, Firearms and Explosives, and U.S. Marshals Service. Cass County Sheriff Paul D. Laney said, “It’s incidents like this that demonstrate the quality of the relationship between the community itself and their local, state and federal law enforcement officers. We all came together to solve an immediate issue, which was the apprehension of the suspect, and then in the aftermath the prosecution of the escapee and the U.S. Attorney’s Office holding the transport company accountable for the incident. Teamwork like this makes me proud to be a law enforcement officer in North Dakota.”
Jeanna’s Act was enacted in response to the escape of convicted murderer Kyle Bell while being transported between correctional facilities by a private prisoner transport company. Bell had sexually assaulted and murdered 11-year-old Jeanna North in Fargo, N.D., in 1993; he was convicted of murder and sentenced to life in prison. In October 1999 Bell escaped while being transferred by a private prisoner transport company. Bell was re-apprehended in Texas three months later.
U.S. Attorney Hosted Gang Prevention SummitRead the Press Release
BOSTON – On Sept. 16, 2013, the United States Attorney’s Office hosted nearly 500 law enforcement and community professionals from around New England at its Annual Gang Prevention Summit in Marlborough. This year’s summit, sponsored by the Department of Justice’s Project Safe Neighborhoods (PSN) program, focused on coalescing best practices that can be utilized throughout Massachusetts.
The summit began at 9:00 a.m. with opening remarks by U.S. Attorney Carmen M. Ortiz and Middlesex District Attorney Marian T. Ryan. The afternoon session was highlighted with the keynote address by Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police. Col. Alben discussed the challenges facing law enforcement today, citing the Marathon bombing case and the state drug lab scandal.Participants had the opportunity to learn from experts in the public and non-profit sectors about prevention and intervention involving youth in gangs, innovative community policing initiatives, and lessons learned from established prison re-entry programs. The diverse range of participants included local law enforcement, prosecutors, social workers, medical professionals, educators, faith-based partners and residents. The purpose of the summit was to form and strengthen working partnerships among stakeholders as well as to provide relevant training.
“Bringing together a varied group of professionals to work collaboratively to prevent violence in our communities, especially gun and gang violence, is critically important,” said U.S. Attorney Ortiz. “By continually educating ourselves and implementing proven, innovative approaches tailored to meet the challenges of individual communities, we will achieve greater progress in safeguarding security for all.”
The Project Safe Neighborhoods initiative was launched in 2001 by the Department of Justice to reduce gun and gang crime in America. Spearheaded by U.S. Attorneys’ Offices, PSN operates as a comprehensive, coordinated and community-based approach that promotes prevention and deterrence efforts. The five foundation principles of PSN are to create working partnerships, plan strategically, provide up-to-date training, further community outreach, and to be accountable for outcomes.
U.S. Attorney Continues Focus on Education Funds FraudRead the Press Release
PITTSBURGH - Following the beginning of a new school year, U.S. Attorney David J. Hickton today focused public attention on the office’s School Corruption Hotline, 412-894-7515. The hotline number rings directly in the U.S. Attorney’s Office where callers may leave their name, contact information, and details regarding suspected misuse of tax dollars supporting education.
“The advent of a new school year provides the opportunity to remind citizens that they are a vital resource in helping us identify fraud and illegal activity within the school system,” said U.S. Attorney Hickton. “We need the public to continue to provide information regarding suspected abuses, including misuse of district education funds, theft, spending irregularities, corruption in the contract and bidding process, and bribery, kickbacks or other forms of collusion with outside vendors.”
U.S. Attorney Hickton encouraged callers to be as specific as possible when leaving information so that the appropriate investigating agency, Federal Bureau of Investigation, IRS - Criminal Investigation, Department of Education - Office or Inspector General, or others, are able to pursue leads.
U.S. Attorney Hickton activated the first-of-its-kind hotline in November 2011. Dozens of callers have provided information resulting in several open and ongoing investigations.
The Western District of Pennsylvania encompasses 25 counties in the westernmost part of the Commonwealth: Allegheny. Armstrong, Beaver, Butle, Clarion, Fayette, Greene, Indiana, Jefferson, Lawrence, Mercer, Washington, and Westmoreland in the Greater Pittsburgh area; Crawford, Elk, Erie, Forest, McKean, Venango and Warren in the Erie area; and Bedford, Blair, Cambria, Clearfield and Somerset in the Johnstown area.
Two USA Dry Van Trucking Company Ex-Executives Convicted in $26 Million Fraud SchemeRead the Press Release
HOUSTON – Aurelio “Jim” Aleman, 59, and Oscar Barbosa, 50, have been convicted of conspiracy to commit wire fraud, announced United States Attorney Kenneth Magidson. Aleman was the former chief operations officer of USA Dry Van Logistics (USADV), a cross-border trucking company that services the maquiladora industry. Barbosa was the former controller of the company.
According to records, Aleman and Sergio Lagos - the former chief executive officer of USADV - entered into a financing agreement with GE Capital Corporation (GECC) under which GECC would issue a revolving line of credit which was secured by USADV’s accounts receivables. By January 2010, the maximum borrowing limit under the agreement was increased to $38 million. Pursuant to the agreement, USADV allegedly justified advances on the line of credit by submitting “borrowing base certificates” to GECC.
Aleman and Barbosa admitted that from March 2008 through the end of January 2010, they joined in a scheme to defraud and swindle GECC, a lending company that provided capital to USADV, fraudulently obtaining funds through a revolving line of credit. At the plea hearing, Aleman and Barbosa admitted they schemed to conceal from GECC the truth about USADV’s declining operating performance and financial results. Rather than reveal USADV’s true condition, Aleman and Barbosa misrepresented USADV’s true operating performance and financial results to include the nature of the USADV’s accounts receivable, against which GECC was permitting USADV to borrow hundreds of thousands of dollars on a weekly basis. This caused USADV to appear to be operating more profitably that it actually was. Aleman and Barbosa signed, prepared and/or directed others to prepare certificates that falsely inflated the amount of the company’s accounts receivables and caused them to be submitted to GECC to enable USADV to obtain more funds than would otherwise have been permitted. Aleman and Barbosa perpetuated and concealed the scheme to defraud GECC by directing other employees to manually invoice millions of dollars of fraudulent receivables to inflate the borrowing base and to create false and forged invoices and support documentation for accounts receivables that did not exist. Aleman and Barbosa also admitted to submitting false financial statements to auditors and GECC.
When the truth about USADV’s operations and finances were revealed, USADV went into bankruptcy. USADV successfully re-organized under Chapter 11 bankruptcy proceedings and is currently operating with new owners. Lagos, Aleman and Barbosa are no longer affiliated with or employed by the company. The amount of actual loss to GECC was more than $26 million.
As a condition of the their plea agreements, both Aleman and Barbosa agreed to make monthly payments towards restitution to GECC prior to sentencing. In Aleman’s plea agreement, he further agreed to the imposition of a money judgment against him in the amount of $26,254,781 which was ordered to be forfeited to the United States.
U.S. District Judge Kenneth M. Hoyt, who accepted the guilty pleas today, set sentencing for Aleman and Barbosa on Dec. 9, 2013, at which time they face up 20 years in prison and up to a $250,000 fine.
The charges against Lagos remain pending. He is presumed innocent unless and until convicted through due process of law.
The investigation was conducted by Homeland Security Investigations and the FBI. Assistant United States Attorneys Casey N. MacDonald and Grady J. Leupold are prosecuting the case.
Three Alleged Ms-13 Members Charged in Murder ConspiracyRead the Press Release
Greenbelt, Maryland – A federal grand jury indicted three defendants today in connection with a conspiracy to participate in murder in aid of a racketeering enterprise known as the La Mara Salvatrucha, or MS-13:Jorge Enrique Moreno-Aguilar, aka “Flaco,” and “Castigato,”, age 20, of District Heights, Maryland,
Juan Alberto Ortiz-Orellana, aka “Chele” and “Furia,” age 25, of District Heights, Maryland, and
Melvin Marquez-Sanchez, aka “Demente,” age 20, formerly of New York.The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Chief Mark A. Magaw of the Prince George’s County Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; Prince George’s County State’s Attorney Angela D. Alsobrooks; and Montgomery County State’s Attorney John McCarthy.
“Today’s indictment is a significant disruption to the illegal operations of MS-13 in Maryland,” said HSI Special Agent in Charge William Winter. “The members of MS-13 spread violence and fear wherever they exist and prey on innocent people, displaying a shocking disregard for human life. HSI will continue to aggressively work with our local, state and federal law enforcement partners in the state of Maryland to target violent transnational gang members who threaten the safety of our communities.”
“Gang investigators from the Prince George’s County Police Department, Montgomery County Police Department, and the Homeland Security Investigations Gang Unit collaborated to develop the identification of these suspects, which led to their arrest and indictment,” stated Prince George’s County Police Chief Mark Magaw. “Today’s indictment is the result of the highly effective partnership that exists among the gang investigators who continue their relentless attack on gang activity in our region.”
MS-13 is a national and international gang composed primarily of immigrants or descendants from El Salvador. Branches or “cliques” of MS-13, one of the largest street gangs in the United States, operate throughout Prince George’s County and Montgomery County, Maryland.
The four count indictment alleges that the defendants were members and associates of MS-13. Between January and March 2013 the defendants targeted an individual believed to be affiliated with the rival 18th Street gang. According to the indictment, the defendants obtained photos of the victim, and planned the murder of the victim. Moreno-Aguilar and Ortiz-Orellana possessed a gun to be used for the murder. On March 12, 2013, Moreno-Aguilar and Ortiz-Orellana went to Capital Heights, Maryland, found and shot the victim multiple times, killing him. They fled and disposed of the gun.
All three defendants face a maximum sentence of 10 years in prison for conspiring to commit murder in aid of racketeering. Moreno-Aguilar and Ortiz-Orellana also face a maximum sentence of life in prison for murder in aid of racketeering; murder resulting in the use of a gun; and using a firearm during a crime of violence.
Moreno-Aguilar and Ortiz-Orellana are currently in state custody on related state charges. Marquez-Sanchez is currently in custody of immigration authorities. The defendants are expected to have their initial appearances in federal court in Greenbelt on these federal charges within the next couple weeks.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein commended the HSI Baltimore, Prince George’s County and Montgomery County Police Departments and Prince George’s and Montgomery Counties State’s Attorney=s Offices for their work in the investigation and proceedings. Mr. Rosenstein thanked Assistant United States Attorney William D. Moomau and Kevin Rosenberg, a Trial Attorney with the Justice Department’s Organized Crime and Gang Section, who are prosecuting this Organized Crime and Drug Enforcement Task Force case.
Staten Island Doctor Sentenced to 151 Months in Prison in Connection with $77 Million Medicare Fraud SchemeRead the Press Release
BROOKLYN, NY – Earlier today, Gustave Drivas, M.D., 58, of Staten Island, New York, was sentenced to 151 months in prison for his role as a “no-show” doctor in a $77 million Medicare fraud scheme. In addition to the prison term, U.S. District Judge Nina Gershon of the Eastern District of New York sentenced Drivas to three years of supervised release with a concurrent exclusion from employment with any federally funded medical treatment program, ordered him to forfeit $511,000, and ordered him to pay restitution in the amount of $50,943,386. The State of New York revoked Dr. Drivas’s medical license earlier this year.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); and Special Agent-in-Charge Thomas O’Donnell of the HHS Office of Inspector General (HHS-OIG).
Drivas was convicted by a jury of health care fraud conspiracy and health care fraud on April 8, 2013, after a seven-week trial. Including Drivas, 13 individuals have been convicted of the massive fraud scheme, either through guilty plea or trial conviction.
“Abandoning the mandate to ‘do no harm,’ Dr. Drivas was instead up to no good. Drivas put personal greed before patient care, and was willing to sell his Medicare billing number for cash in his pocket,” stated United States Attorney Lynch. “This Office and the Department of Justice will aggressively investigate and prosecute health care fraud. Corrupt doctors like Dr. Drivas are not above the law and will be held accountable for their crimes.”
According to court documents and the evidence at trial, from 2005 to 2010, Drivas was the medical director or a rendering physician of a clinic in Bath Beach, Brooklyn, that billed Medicare under three corporate names: Bay Medical Care PC, SVS Wellcare Medical PLLC, and SZS Medical Care PLLC (Bay Medical clinic). Drivas knowingly authorized his co-conspirators at the clinic to use his Medicare billing number to fraudulently charge Medicare more than $20 million for medical procedures and services that were never performed. In return, he received more than $500,000 for his role in the scheme. The evidence proved that Drivas was a “no show” doctor, who almost never visited the clinic except to pick up his check. The evidence also showed that the clinic paid cash kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for more than $77 million in services that were medically unnecessary and never provided.
The government’s investigation included the use of a court-ordered audio/video recording device hidden in a room at the clinic, in which the conspirators paid cash kickbacks to corrupt Medicare beneficiaries. The conspirators were recorded paying approximately $500,000 in cash kickbacks during a period of approximately six weeks from April to June 2010. This room was marked “PRIVATE” and featured a Soviet-era poster of a woman with a finger to her lips and the words “Don’t Gossip” in Russian. The purpose of the kickbacks was to induce the beneficiaries to receive unnecessary medical services or to stay silent when services not provided to the patients were billed to Medicare.
To generate the large amounts of cash needed to pay the patients, Drivas’s business partners and co-conspirators recruited a network of external money launderers who cashed checks for the clinic. Clinic owners wrote clinic checks payable to various shell companies controlled by the money launderers. These checks did not represent payment for any legitimate service at or for the Bay Medical clinic, but rather were written to launder the clinic’s fraudulently obtained health care proceeds. The money launderers cashed these checks and provided the cash back to the clinic. Clinic employees used the cash to pay illegal cash kickbacks to the Bay Medical clinic’s purported patients.
This case is being prosecuted by Trial Attorney Sarah M. Hall of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys William P. Campos and Shannon C. Jones of the Eastern District of New York. The case was investigated by the FBI and HHS.
The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York. The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
The Defendant:
GUSTAVE DRIVAS, M.D.
Staten Island, New York
Age: 58Schoolteacher Arrested on Child Pornography Distribution ChargesRead the Press Release
LAREDO, Texas – Over the weekend, federal and local law enforcement authorities arrested Jorge Valadez, 53, for receiving and distributing videos depicting children engaging in sexually explicit conduct, announced United State Attorney Kenneth Magidson.
The criminal complaint, filed today, charges Valadez - a high school teacher in Laredo - with receipt and distribution of child pornography via the Internet.
Valadez made his initial appearance this morning before U.S. Magistrate Judge Guillermo R. Garcia who ordered Valadez be detained without bond pending further criminal proceedings. He is set for a detention hearing on Sept. 19 at 10:00 a.m.
The complaint alleges that an investigator discovered someone sharing several videos constituting child pornography via the Internet. The investigation allegedly led to the home of Valadez in Laredo. According to the complaint, federal agents then obtained and executed a search warrant on Friday evening, at which time, he was taken into custody.
Valadez allegedly used a peer-to-peer network to share images and videos of child pornography.
If convicted, Valadez faces a minimum of five and up to 40 years in federal prison as well as a maximum fine of $250,000.
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."
The case is being investigated by Homeland Security Investigations with the assistance of the Webb County Sheriff’s Department. Assistant United States Attorney Homero Ramirez is prosecuting the case.
A criminal complaint is a formal accusation of criminal conduct, not evidence.
The defendant is presumed innocent unless and until convicted through due process of law.SIRF ChargesRead the Press Release
BATON ROUGE, LA – Acting United States Attorney Walt Green announced the filing of criminal charges against five (5) individuals accused of committing tax fraud, identity theft, and related crimes in the Baton Rouge area. Collectively, these five individuals are alleged to have submitted more than 1,000 fraudulent federal income tax returns, fraudulently claiming refunds totaling more than $1.4 million. The charges are the result of an initiative by the United States Attorney’s Office, the Internal Revenue Service’s Criminal Investigations Division, and the United States Department of Justice’s Tax Division, to combat stolen identity refund fraud and other tax fraud schemes.
The following individuals have been charged:
HOLLY GREEN, age 28, of Baton Rouge, Louisiana, was charged in a bill of information with making false claims and identity theft. The bill of information alleges that GREEN obtained the names and personal identifying information, including Social Security numbers, of numerous victims, and used that information to electronically file fraudulent federal tax returns in the victims’ names. GREEN directed the fraudulent refunds to be deposited onto debit cards that she controlled, or mailed to her, at which point she would cash the checks and gain control of the funds. From January 2012 through April 2012, GREEN submitted approximately 71 false tax returns, claiming refunds totaling approximately $123,155. If convicted of both counts, GREEN faces a maximum possible prison term of ten (10) years and fines totaling $500,000. GREEN also faces the forfeiture of the proceeds from the alleged scheme. The case is being prosecuted by Assistant United States Attorney Shubhra Shivpuri.
MONA HILL, age 32, of Plaquemine, was charged in a bill of information with wire fraud and aggravated identity theft. The bill of information alleges that HILL obtained the names and personal identifying information of numerous victims, and used that information to file fraudulent federal tax returns in the victims’ names. From January 2012 through July 2012, HILL submitted approximately 488 false tax returns, claiming refunds totaling approximately $661,258. If convicted, HILL faces up to twenty (20) years in prison on the wire fraud count, which would be followed by a mandatory, 2-year prison term as a result of the aggravated identity theft count. HILL also faces fines totaling $500,000 and forfeiture of the proceeds from the alleged scheme. The case is being prosecuted by Assistant United States Attorney Shubhra Shivpuri.
ASHLEY D. RICKS-STAMPLEY (RICKS), age 28, of Baton Rouge, was charged in a bill of information with wire fraud and aggravated identity theft. The bill of information alleges that RICKS obtained the names and personal identifying information of numerous victims and then used the information to submit false income tax returns in the victims’ names for the 2010 and 2011 tax years. According to the bill of information, RICKS submitted approximately 455 false tax returns and fraudulently obtained approximately $559,953 through her scheme. If convicted, RICKS faces up to twenty (20) years in prison on the wire fraud count, which would be followed by a mandatory, 2-year prison term as a result of the aggravated identity theft count. RICKS also faces fines totaling $500,000 and forfeiture of the proceeds from the alleged scheme. The case is being prosecuted by Assistant United States Attorney Reginald Jones.
KIMBERLY H. SCOTT, age 40, of Baton Rouge, was charged in a bill of information with theft of public funds. The bill of information alleges that SCOTT worked with another individual who had obtained the names and personal identifying information of numerous victims and used those stolen identities to file fraudulent tax returns. According to the bill of information, SCOTT allowed this other individual to use SCOTT’s bank account to receive the tax refunds that the fraudulent returns would generate. According to the charge, SCOTT allowed the fraudulent proceeds from approximately 74 false tax returns to be deposited into her bank account, totaling approximately $96,497, at which point SCOTT gained control of the funds. If convicted, SCOTT faces up to ten (10) years in prison and a $250,000 fine. SCOTT also faces the forfeiture of the proceeds from the alleged scheme. The case is being prosecuted by Assistant United States Attorney Reginald Jones.
On September 11, 2013, a federal grand jury returned an indictment charging SHYWANDA F. UNDERWOOD, age 39, of Baker, with four counts of making false claims for tax refunds and four counts of identity theft. The indictment alleges that while UNDERWOOD owned and operated a tax preparation business in Baker, she used W-2 forms for fictitious businesses to prepare and submit false tax returns, claiming tax credits and refunds to which the taxpayers were not entitled. The indictment also alleges that UNDERWOOD prepared and filed false tax returns using stolen identities, including individuals’ Social Security numbers. The indictment alleges that UNDERWOOD claimed fraudulent tax refunds totaling approximately $20,241. If convicted of all 8 counts in the indictment, UNDERWOOD faces a maximum possible prison term of forty (40) years and fines totaling $2,000,000. UNDERWOOD also faces the forfeiture of the proceeds from the alleged scheme. In addition to IRS Criminal Investigation, the case is being investigated by the United States Secret Service. The case is being prosecuted by Assistant United States Attorney Cam T. Le.
“Investigating refund fraud and identity theft is a priority for IRS Criminal Investigation,” said IRS Criminal Investigation Special Agent-in-Charge Gabriel Grchan. “Stealing identities and filing false tax returns is a serious crime that hurts innocent taxpayers. The recent charges in Baton Rouge should serve as a strong warning to those who are considering similar conduct. The IRS and the U.S. Attorney’s Office are serious about investigating these crimes and prosecuting those who engage in this type of conduct.”
Acting U.S. Attorney Green stated: “This office will continue to aggressively pursue criminals who commit identity theft and use those stolen identities to defraud the United States and line their own pockets. The filing of these five new cases is another important step in that important effort. Working with our federal, state, and local partners, our investigations of this type of crime in our district will continue.”
Presidential Tax Service Owner Ordered to Prison for Falsifying ReturnsRead the Press Release
HOUSTON – Sharon Edwards Kitine, the former owner of a now defunct Presidential Tax Service in Houston, has been sentenced to federal prison for falsifying client returns, United States Attorney Kenneth Magidson announced today along with Lucy Cruz, special agent in charge of Internal Revenue Service – Criminal Investigation (IRS-CI). Kitine pleaded guilty April 29, 2012, and the tax service establishment she owned closed in March 2012 following her arrest.
Today, U.S. District Judge Vanessa Gilmore, who accepted the guilty plea, handed Kitine a sentence of 24 months in prison to be immediately followed by one year of supervised release.
The factual basis in support of the plea stated that Kitine claimed false deductions for Houston-area clients that fraudulently increased tax refunds by approximately $205,682 for tax years 2006 through 2011, and she was further ordered to pay that amount in restitution to the IRS.
Kitine was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future. However, the government stated its intention to seek Kitine’s immediate custody if she fails to truthfully file her own 2012 tax return by the due date of Oct. 15, 2013. At the hearing today, Kitine sought probation in order to immediately begin to repay the National Treasury for the harm she has caused. The United States responded by advising the court that, despite having served as a paid preparer for others for several years, the IRS had no record that Kitine had ever field a personal tax return prior to being charged in this case. Further, after permitted release on bond in March 2012, Kitine had a filed a 2011 personal income tax return as required by her conditions of release but failed to pay any of the taxes shown due with that return.
Court records indicated that on or about March 29, 2008, Kitine knowingly prepared and caused to be filed with the IRS a false 2007 U.S. Individual Income Tax Return – Form 1040 for taxpayers and fee-paying clients in need of tax return preparation services. Without consent of the taxpayers, Kitine included certain materially false deductions with the intention of generating an excessive federal income tax refund and causing a direct pecuniary harm of several thousand dollars to the IRS.
Specifically, Kitine knowingly and willfully included materially false deductions for a variety of Schedule C deductions as well as Schedule A deductions for home mortgage interest and real estate taxes even though the taxpayers rented their home. This tax return alone caused a loss to the U.S. Treasury in the approximate amount of $11,261.
Kitine also knowingly and willfully prepared and caused to be filed with the IRS another 28 false federal income tax returns for other clients for tax years 2006 through 2011 that generated excessive refunds based upon false and fraudulently inflated deductions and credits that caused another $194,421 in aggregate losses to the IRS.
The investigation leading to these charges was conducted by IRS-CI. Assistant U.S. Attorney Jimmy Sledge Jr. is prosecuting the case.
Pennsylvania Pill Dealer Pleads Guilty to Federal Oxycodone Possession ChargeRead the Press Release
MDENT agents found prescription pain pills, firearms and cash at ‘stash houses’ during investigation
CHARLESTON, W.Va. – A 31-year-old Allentown, PA, man pleaded guilty to his role in an illegal oxycodone distribution scheme in Charleston, announced U.S. Attorney Booth Goodwin. Walter Parris, also known as “Panna,” pleaded guilty today to aiding and abetting the possession with intent to distribute a quantity of oxycodone and alprazolam, also known as “Xanax.”
On April 29, 2012, members of the Metropolitan Drug Enforcement Network Team (MDENT) executed a search warrant on 723 Garvin Street located in Charleston, based on officers’ probable cause that prescription pills were being sold out of the residence. During the execution of the search warrant, agents spotted Parris and several of his associates at 721 ½ Garvin Street, a nearby residence. Parris was taken into police custody based on an outstanding warrant for his arrest. Police later conducted a search of the residence and found a set of luggage that belonged to Parris. A search of the luggage revealed a loaded .25 caliber pistol with a chambered round and numerous paper documents bearing Parris’ name.
Using several investigative leads, agents determined that Parris and his associate used the 723 Garvin Street residence to distribute their pills but maintained a “stash house” to store their prescription pain pills at 818 West Avenue in Charleston. MDENT agents also discovered that a door key, found in Parris’ associate’s pocket at the time of his arrest, matched the bottom and top lock for the 818 West Avenue residence. A search warrant was executed on that residence. Police found a .45 caliber pistol, $3,740 cash, 520 Xanax pills, 93 oxycodone pills, marijuana and paper documents linked to Parris.
Parris faces up to 20 years in prison and a $1 million fine when he is sentenced on December 18, 2013 by United States District Judge John T. Copenhaver, Jr.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
This case was also brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
The investigation was conducted by MDENT. Assistant United States Attorney Monica D. Coleman is in charge of the prosecution.
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