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7 November 2013
Hogsett Presents United States Attorney Awards to Local, Federal Law Enforcement OfficersRead the Press Release
FISHERS – Joseph H. Hogsett, the United States Attorney, was in Hamilton County today to acknowledge the presentation of U.S. Attorney Awards to four federal and local law enforcement officers. Joined by United States Marshal Kerry Forestal, HSI-ICE Assistant Special Agent-in-Charge Gary Woolf, Carmel Police Chief Tim Green, and Fishers Police Chief George Kehl, Hogsett applauded the significant impact of these four individuals in a child exploitation prosecution involving an Indiana minor.
“The work of these individuals on this case is an example of law enforcement at its best,” Hogsett said. “This was a complicated case with many moving parts, but the selfless dedication and tireless work of our partners here in Hamilton helped stop the victimization of a young child and ensure the defendants were held fully accountable.”
The United States Attorney Award was established in 2003 to recognize outstanding law enforcement work in Hoosier communities as part of federal investigations and prosecutions. Just twenty total awards were awarded in 2013, and the Carmel and Fishers police departments were two of only six local law enforcement agencies to be recognized. Those honored today included:
• Detective John Pirics, Carmel Police Department
• Detective J.D. Floyd, Fishers Police Department
• Special Agent Mike Johnson, Department of Homeland Security
• Senior Inspector Tammy Hammons of the United States Marshals ServiceIn February 2013, these four individuals participated in a joint operation by the Indiana Internet Crimes Against Children Task Force. That investigation involved the criminal conduct of Leslie Woods, an Indiana resident who had failed to register as a sex offender, and Brock Boston, a resident of Columbus, Indiana.
Woods and Boston together had met and formed a relationship with a minor boy in Ohio who they filmed while he engaged in sexually explicit conduct. In addition, Boston was also found to be producing child pornography involving a four year-old family member. The two men were subsequently found to possess large collections of child pornography that they had acquired from other sources.
According to Assistant U.S. Attorney Gayle Helart, who prosecuted the case for the government, the extraordinary work of these four individuals was vital in convicting the two men. Boston was sentenced in May of this year to 28 years in federal prison, and Woods was sentenced to 26 ½ years in federal prison. Both were also ordered to serve lifetime supervised release when their prison terms are completed.
Hartford Residents Charged with Operating Identity Theft and Credit Card Scheme, Counterfeiting OffensesRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that JONATHAN PRESTON, 22, and LUMI NUNEZ, 33, of Hartford, were arrested today on a criminal complaint alleging that they operated an extensive identity theft and credit card fraud scheme, and engaged in counterfeiting offenses.
PRESTON and NUNEZ were arrested this morning at their residence at 848 Capitol Avenue in Hartford. They appeared this afternoon before U.S. Magistrate Judge Donna F. Martinez in Hartford and are detained pending a hearing that is scheduled for tomorrow.
As alleged in the criminal complaint, PRESTON and NUNEZ used the Internet and other sources to obtain personal identifying information of several prominent individuals, and used that information to pose as their victims to gain access to the victims’ credit card accounts. Since approximately 2010, it is alleged that PRESTON and NUNEZ used the credit card accounts to make more than $500,000 in unauthorized purchases and cash withdrawals. The purchases included automobiles, Vespa scooters, jewelry, and a limousine trip from Connecticut to Ohio.
Members of the U.S. Secret Service, Hartford Police Department and Connecticut Financial Crimes Task Force conducted a court-authorized search of the defendant’s residence today and seized from the premises a BMW 650i automobile that had allegedly been rented for $16,000 using a fraudulent credit card account number.
The complaint further alleges that a previous search of a Hartford residence occupied by PRESTON and NUNEZ revealed counterfeit $50 bills and counterfeiting instructions.
The complaint specifically charges PRESTON and NUNEZ with manufacturing counterfeit currency, passing counterfeit currency, and conspiracy.
Acting U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This investigation is being conducted by the U.S. Secret Service, Hartford Police Department and Connecticut Financial Crimes Task Force. The Task Force includes members of the U.S. Secret Service, U.S. Postal Inspection Service, Internal Revenue Service – Criminal Investigation, Connecticut State Police, and the Greenwich, Hartford, Monroe, Stamford, Shelton, Stratford and Waterford Police Departments. The case is being prosecuted by Assistant U.S. Attorney Edward Chang.
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(203) 821-3722 [email protected]George Theodore Sutherland Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on November 7, 2013, before U.S. Magistrate Judge Keith Strong. GEORGE THEODORE SUTHERLAND, a 21-year-old resident of Box Elder and an enrolled member of the Chippewa Cree Indian Tribe, pled guilty to assault resulting in serious bodily injury. Sentencing has been set for February 7, 2014. He is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Danna R. Jackson, the government stated it would have proved at trial the following:
On April 3, 2012, within the exterior boundaries of the Rocky Boy(s Indian Reservation, SUTHERLAND chased the victim down a road, intentionally kicking her and causing the victim to fall and strike her head on the ground.
As a result of the fall, the victim suffered a gash on her temple. The victim sought treatment at the Northern Montana Hospital Emergency Room. The victim bled a significant amount. In addition to receiving several sutures, the victim was treated for her extreme physical pain.
SUTHERLAND faces possible penalties of 10 years in prison, a $250,000 fine and 3 years supervised release.
The investigation was conducted by the Federal Bureau of Investigation.
Four Members of Colombian Guerilla Organization Indicted on Charges in 2000 Kidnapping-Three U.S. Nationals Were Among the Hostages Taken by the ELN-Read the Press Release
WASHINGTON – Four members of a violent guerilla organization were indicted today on conspiracy and hostage-taking charges stemming from the kidnapping of more than 60 people in Colombia in 2000, including three United States nationals. As a result of the ensuing captivity, three Colombian citizens who were taken hostage by the kidnappers died.
The indictment, returned by a grand jury in the U.S. District Court for the District of Columbia, was announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia, and Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Division.
According to the indictment, at the time of the crimes, the defendants were members of the Ejercito De Liberación Nacional (ELN), which in English translates to the National Liberation Army. Since its inception in 1964, the ELN has engaged in an armed conflict to overthrow the democratically elected government of the Republic of Colombia. The ELN has engaged in terrorist activity, including murder, hostage-taking and the violent destruction of property.
Those indicted today include Eudes Ojeda Ovando, 44, also known as “El Tuerto” and “Martin;” Fidel Castro Murillo, 54, also known as “El Profe” and “Daniro Rodriguez” and two others identified as John Does. They were each charged with one count of conspiracy to commit hostage-taking resulting in death and three counts of hostage-taking. None of the defendants is in custody. If convicted of these charges following an extradition, each defendant would face a maximum term of 60 years of incarceration, the maximum sentence permitted under Colombian law for Colombian nationals extradited to the United States for prosecution.
“The indictment returned today alleges that four members of an armed and violent guerilla organization held more than 60 hostages – including American citizens – for ransom in the Colombian jungle,” said U.S. Attorney Machen. “During this harrowing ordeal, members of this insurgent group allegedly fired at Colombian military helicopters searching for the hostages and armed themselves with bazookas to resist the military operation pursuing the guerillas. This prosecution demonstrates our commitment to pursuing members of foreign terrorist organizations who target Americans as well as our resolve to seeking justice for the three Colombian citizens who actually died during this hostage ordeal.”
“The ELN is a foreign terrorist organization whose members have engaged in violent acts against American and Colombian citizens. These indictments today demonstrate the FBI’s commitment to bring these ELN members to justice,” said Special Agent in Charge Steinbach. “The outstanding, long-term cooperation between the Colombian National Police and U.S. law enforcement has dealt another blow to international terrorism.”
According to the indictment, the defendants were among the leaders of a series of kidnappings carried out on Sept. 17, 2000. The three U.S. nationals – a woman, her brother, and her sister-in-law – were taken hostage at a country home roughly 30 minutes outside of Cali, Colombia. More than 60 others, all Colombian nationals, were taken hostage at two restaurants in the area. The restaurants and country home were all near Kilometer 18 of a road that led from Cali to Buenaventura, Colombia. The hostages were forced into vehicles and taken into the Colombian jungle and mountains. One of the U.S. nationals, a 66-year-old man, was released at that point because of concerns he would not survive a journey through the jungle and mountains and would also slow down the kidnappers during their escape from Colombian authorities.
The indictment alleges that the defendants and their co-conspirators used firearms to keep and detain the hostages; threatened to kill the hostages; conducted or attempted to conduct negotiations for ransom with family members of the hostages, and demanded that military operations by the armed forces of the Republic of Colombia against the hostage-takers cease. On the second day of the ordeal, the kidnappers released another one of the U.S. nationals – a 58-year-old woman – so that she could personally convey one of their ransom demands. The third U.S. national, a 69-year-old woman, was released on Sept. 20, 2000 after three days in captivity, but the kidnappers continued to hold her adult son as a hostage and continued to demand that she pay a large ransom for his release.
The rest of the hostages remained with the ELN, some for several weeks. During this time-frame, the indictment alleges, the ELN conspirators fired at helicopters of the Colombian military members who were attempting to locate the hostages, and also armed bazookas intended to be used against the Colombian military. Three hostages, all Colombian nationals, died as a result of the extreme conditions: Dr. Miguel Nassif, Carlos Alberto Garcia, and Alejandro Henao Botero. According to the indictment, all were denied medical treatment by their captors.
By early November 2000, the last remaining hostages were finally released to representatives from the Colombian Red Cross and the Colombian Peace Commissioner. Even after that, however, the kidnappers pressed on with ransom demands.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws. Every defendant is presumed innocent until and unless found guilty.
The charges were the result of an investigation led by the FBI=s Miami Field Division and are being prosecuted by Assistant U.S. Attorneys Brenda J. Johnson and Fernando Campoamor-Sanchez of the U.S. Attorney’s Office for the District of Columbia. Assistance also was provided by the FBI Office of the Legal Attaché in Colombia.
13-384Fort Yates Man Sentenced for AssaultRead the Press Release
BISMARCK– U.S. Attorney Timothy Q. Purdon announced that on Nov. 7, 2013, Tracy Peters, 47, Fort Yates, N.D., pleaded guilty and was sentenced by U.S. Magistrate Judge Charles S. Miller Jr. on a charge of assault by striking, beating or wounding for assaulting a woman with whom he had a relationship.
Magistrate Judge Miller sentenced Peters to two years of probation. Peters was ordered to complete 60 hours of community service, to pay restitution of $536 and to pay a $25 special assessment to the Crime Victim’s Fund.
On April 20, 2013, Peters, a non-Indian, assaulted an Indian woman on the Standing Rock Indian Reservation. The woman suffered bruising to her face.
Under the Violence Against Women Reauthorization Act of 2013, the penalty was increased for the offense of assault by striking, beating or wounding from a class B misdemeanor, with a maximum penalty of up to 6 months’ imprisonment, to a class A misdemeanor, with a maximum penalty of up to 1 year’s imprisonment.
The case was investigated by the Bureau of Indian Affairs – Standing Rock Agency.
Assistant U.S. Attorney Gary Delorme and Special Assistant U.S. Attorney Grant Walker prosecuted the case.Former Seattle Investment Advisor Convicted of Wire Fraud, Money Laundering and Investment Advisor FraudRead the Press Release
A long-time Seattle investment advisor was convicted today by a federal jury of 32 criminal counts including wire fraud, money laundering and investment advisor fraud, announced U.S. Attorney Jenny A. Durkan. MARK F. SPANGLER, 58, formerly of Seattle, (who now resides in Portland, Oregon) promised his clients that he would protect their life’s savings by investing it in safe investments. Instead, SPANGLER diverted their money – without their knowledge or consent – to two risky start-up companies that he controlled and in which he had a significant financial stake. The jury deliberated for two days following the three week trial. U. S. District Judge Ricardo S. Martinez will sentence SPANGLER on February 6, 2014.
“Mark Spangler gambled with other people’s money without their knowledge – he defrauded friends and family members who trusted him with their life’s savings,” said U.S. Attorney Jenny A. Durkan. “This defendant used his position of trust as a tool to cheat his clients out of money for their mortgages, their children and grandchildren’s education, their retirement and plans for charitable giving.”
The evidence at trial demonstrated that SPANGLER repeatedly violated his fiduciary duty as an investment advisor by hiding where his clients’ money was invested, and by providing them with false account statements which, among other things, drastically inflated the value of their investments. SPANGLER told his clients that their assets were worth over $73 million. However, after SPANGLER ran out of money and put his business into receivership, only approximately $28 million was recovered for the victims, resulting in a loss of approximately $50 million.
Many of the investors who testified in court described how they were told their funds were conservatively invested in publicly traded companies and in bonds. SPANGLER provided them false quarterly account statements fraudulently inflating the value of their accounts and how the money was invested. When some investors sought to liquidate their holdings SPANGLER ran a Ponzi scheme using new money from investors to pay out the other investors. Eventually, SPANGLER was unable to raise money to cover all the liquidation requests and was forced to place his investment business into receivership. At trial, prosecutors presented evidence that federal law enforcement officials executed a search warrant at SPANGLER’s residence on September 23, 2011, disrupting SPANGLER’s plans to flee the jurisdiction. SPANGLER had purchased airline tickets for Ecuador with his wife, Luanne Renfrow, and they were planning to leave on September 25, 2011. The couple had also placed their million dollar Capitol Hill home and his $890,000 yacht up for sale when the search warrant was executed.
“The FBI is pleased that Mr. Spangler will be held accountable for hurting people who trusted him,” said Special Agent-in-Charge Laura M. Laughlin of the FBI Seattle office. “Mr. Spangler exploited clients who specifically chose him for a reputation of honesty and integrity, then he constructed layers of deceit to mask his exploitation. The FBI has been proud to partner with the USAO, IRS, and SEC in ending Mr. Spangler's callous criminal activity.”
“This case is a clear example of how greed triumphed over friendship, judgment and honesty,” said Kenneth J. Hines, Special Agent in Charge of the Seattle Field Office, IRS Criminal Investigation. “The title “Investment Advisor” is used by professionals all over the country as they assist their clients in securing their financial future. But when a fraudster uses that title to prey on the dreams of investors, federal law enforcement will hold them accountable. The jury’s message today to Mr. Spangler was, ‘guilty.”
During the course of his scheme, SPANGLER and his company collected over $4 million in investment advisor fees from his clients and over $1 million in fees from the two startup companies. SPANGLER also stood to gain approximately 20% of any profits from the investments he made in the two startup companies if they turned out to be successful. At the very same time SPANGLER was losing tens of millions of his clients’ money, SPANGLER used client fees to live a life of luxury. SPANGLER traveled the world, purchased an $890,000 yacht, and a $20,000 engagement ring.
The case was investigated by the FBI and Internal Revenue Service Criminal Investigation (IRS-CI).
The case is being prosecuted by Assistant United States Attorneys Carl Blackstone, Mike Lang, and Francis Franze-Nakamura.Former School Principal Sentenced to Two Years in Prison for Possession of Child PornRead the Press Release
PHILADELPHIA - Troy Czukoski, 43, of Exton, PA, was sentenced today to 24 months in prison for possessing more than 150, but less than 300, images of children engaging in sexually explicit conduct. At the time of the investigation, Czukoski was serving as Principal of the Springton Lake Middle School in the Rose Tree Media School District in Delaware County. In addition to the prison term, U.S. District Court Judge Legrome D. Davis ordered 10 years of supervised release, a $10,000 fine and a $100 special assessment. Czukoski must report to prison on December 30, 2013.
Czukoski was identified through a website that sells child porn. Records from that website showed the Czukoski had made purchases from 2008 through 2011. A warrant was then executed on the defendant=s home, during which the defendant confessed that he had purchased the pornographic content over the internet. Agents with the U.S. Postal Inspection Service found numerous CDs and DVDs, as well as two flash drives that contained images and video of child porn. Czukoski pleaded guilty on May 10, 2013.
The case was investigated by the United States Postal Inspection Service and was prosecuted by Assistant United States Attorney Michelle Rotella.
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PATTY HARTMAN, Media Contact, 215-861-8525Former Mental-Health Clinic Therapist Sentenced for Role in $55 Million Medicare Fraud SchemeRead the Press Release
A former therapist for Biscayne Milieu, a Miami-based mental-health clinic, was sentenced yesterday to serve 120 months in prison for his participation in a $55 million Medicare fraud scheme.
U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG) Miami office made the announcement.
Jose Rojo, 39, of Miami, was sentenced by U.S. District Judge Marcia G. Cooke in the Southern District of Florida. Rojo was convicted on Aug. 7, 2013, of one count of conspiring to commit health care fraud following a one-month jury trial. In addition to the prison term, Rojo was ordered to pay more than $11 million in restitution, jointly and severally with his co-defendants, and to serve three years of supervised release.
According to the evidence at trial, Rojo and his co-conspirators caused the submission of more than $55 million dollars in fraudulent claims to Medicare through Biscayne Milieu, which purportedly operated a partial hospitalization program (PHP) – a form of intensive treatment for severe mental illness. Instead of providing PHP services, the defendants devised a scheme in which they paid patient recruiters to refer ineligible Medicare beneficiaries to Biscayne Milieu for services that were never provided. Many of the patients admitted to Biscayne Milieu were not eligible for PHP because they were chronic substance abusers, suffered from severe dementia and would not benefit from group therapy, or had no mental health diagnosis but were seeking exemptions for their U.S. citizenship applications.
The evidence at trial further showed that, as a therapist at Biscayne Milieu, Rojo conducted sham therapy sessions for patients he knew were ineligible for PHP treatment. Often Rojo showed up late for these sessions or not at all, but Medicare was still billed as if a full session took place. Rojo created fraudulent documents to help cover-up Biscayne Milieu’s massive fraud, including bogus treatment plans and phony group therapy notes that were copied from one document to the other. Deliberately inaccurate group therapy notes for different patients on different days – often years apart – were in many respects identical, including having the same descriptions of patients’ statements in group sessions and even the same misspelled words. Further, Rojo provided other therapists at the clinic with fake group therapy notes for a fee. Biscayne Milieu billed Medicare for tens of millions of dollars in PHP treatments for these patients.
Various owners, doctors, managers, therapists, patient brokers and other employees of Biscayne Milieu have also been charged with health care fraud, kickback violations, money laundering and other offenses in two indictments unsealed in September 2011 and May 2012. Biscayne Milieu, its owners, and more than 25 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial. Antonio and Jorge Macli and Sandra Huarte – the owners and operators of Biscayne Milieu – were each convicted at trial and were sentenced in April 2013 to 30 years, 25 years and 22 years in prison, respectively.
This case was investigated by the FBI with the assistance of HHS-OIG and was brought by the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Assistant U.S. Attorneys Marlene Rodriguez and James V. Hayes of the Southern District of Florida; Hayes was formerly a trial attorney of the Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, 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.
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 Clay County Officials Admit to Racketeering ConspiracyRead the Press Release
LEXINGTON, KY - Former public officials from Manchester, KY., admitted in federal court that they conspired to organize a long running criminal enterprise to achieve personal gain and control over the politics in Clay County.
Former longtime Clay County Circuit Judge, Russell Cletus Maricle; schools superintendent, Douglas C. Adams; county clerk, Freddy W. Thompson; democratic election commissioner, Charles W. Jones; and election officer William E. Stivers pleaded guilty to a racketeering conspiracy before U.S. District Judge Karen Caldwell on Wednesday.
The defendants admitted that starting in 2002 they conspired to gain control of the Clay County board of elections and corruptly used the board’s authority to control the outcome of elections in the county. In order to carry out this scheme, the defendants acknowledged that they pooled their money together to bribe voters and that they also appointed corrupt election officers who ensured that the bribed voters delivered for the slate of candidates that the members of the conspiracy wanted to win.
Three other co-defendants, Stanly Bowling, and Debra and Bart Morris previously pleaded guilty to the same charge.
Sentencing for the defendants is scheduled for February. Maricle faces a maximum of 87 months imprisonment; Adams, a maximum of 75 months imprisonment; Thompson, a maximum of 66 months imprisonment; Jones, a maximum of 69 months imprisonment; and Stivers, a maximum of 72 months imprisonment. However, any sentence following a conviction would come after the Court considers the U.S. Sentencing guidelines and the federal statutes.
Former Chief Executive Officer of Hospital for Special Surgery Sentenced in Manhattan Federal Court to 18 Months in Prison for Participating in Fraudulent Kickback SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that JOHN R. REYNOLDS, the former Chief Executive Officer (“CEO”) of the Hospital for Special Surgery (the “Hospital”), was sentenced today in Manhattan federal court to 18 months in prison for participating in a fraudulent scheme in which he was paid nearly $300,000 in undisclosed kickbacks from a subordinate Hospital employee. REYNOLDS pled guilty in July 2013 to one count of wire fraud and one count of making false statements to a law enforcement agent. He was sentenced by U.S. District Judge Harold Baer, Jr.
Manhattan U.S. Attorney Preet Bharara said: “During his tenure as CEO of a world-renowned New York hospital, John Reynolds shamelessly put his own personal interests above those of the institution he was charged with running. The successful prosecution of Mr. Reynolds reaffirms the Office’s unwavering commitment to stamping out corruption, particularly by those who abuse positions of power and authority.”
According to the allegations in the Indictment and Superseding Information filed in Manhattan federal court, as well as statements made during court proceedings:
From 1986 until 1997, REYNOLDS served as the Chief Financial Officer of the Hospital, the oldest orthopedic hospital in the United States. In 1997, he was promoted to the position of CEO, and served in that capacity as a full-time Hospital employee until October 2006. In order to effectuate a smooth transition in Hospital leadership to a newly hired CEO, REYNOLDS served as a contract employee in the same position from October 2006 through December 2008.
Between 2000 and 2005, REYNOLDS demanded and received approximately $298,500 in kickbacks from a subordinate employee of the Hospital in exchange for negotiating payment of that employee’s annual bonus. During this same time period, REYNOLDS also repeatedly made false statements to, and deliberately withheld information from, the Hospital’s board of directors about certain conflicts of interest, including his undisclosed financial arrangement with the subordinate Hospital employee.
In addition, in May 2008, during the course of the investigation of his involvement in this fraudulent scheme, REYNOLDS made a number of false statements to an agent of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), about his relationship with that Hospital employee and the funds he had received from that employee.
In addition to his prison term, REYNOLDS, 64, of Venice, Florida, was sentenced to two years of supervised release. REYNOLDS was also ordered to forfeit $718,500. A final determination on restitution is scheduled before Judge Baer on December 11, 2013 at 10:30 a.m.
Mr. Bharara praised the investigative work of the HHS-OIG.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney Christopher D. Frey is in charge of the prosecution.
Former Broker Charged with Multiple Counts of Wire FraudRead the Press Release
United States Attorney James Santelle of the Eastern District of Wisconsin, announced that on November 5, 2013, a federal grand jury returned an indictment against Lisa A. Lewis (age: 48) of Green Bay, Wisconsin, charging her with five counts of Wire Fraud in violation of 18 U.S.C. Section 1343. If convicted, Lewis faces a maximum of 20 years in prison, $250,000 fine, and three years of supervised release on each count.
The indictment alleges that Lewis, a former financial broker, represented herself as an account representative and persuaded approximately thirteen elderly investors to create an individual investment account. Generally, the scheme to defraud included Lewis then creating a joint account under her name and that of a victim-most often unbeknownst to the victim. Without authorization, Lewis then transferred funds from the victim’s individual account, to the joint account, and then to one of Lewis’ personal accounts where she used the funds for personal expenses unrelated to the victim’s financial interest. Such unauthorized expenditures of victim funds included the purchase of a 2013 Chevrolet Camaro. The indictment alleges that Lewis’ fraud scheme resulted in her obtaining funds in excess of $1,000,000.
On November 6, 2013, Lewis appeared before the Honorable William C. Griesbach, District Court Judge. Lewis was taken into custody and is being held at the Brown County Jail. Her next court date is set for November 8, 2013. A trial date has been scheduled for January 13, 2014.
This case was investigated by the Federal Bureau of Investigation and the Brown County Sheriff’s Department. The case is being prosecuted by Assistant United States Attorney William Roach.An indictment is only a charge and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Former Arkansas Scholarship Lottery Deputy Director Sentenced to 37 Months in Prison for Wire Fraud and Money LaunderingRead the Press Release
Little Rock - Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, and Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation Nashville Field Office announced today that United States District Judge Susan Webber Wright sentenced Remmele Mazyck, 34, formerly of Bryant, to 37 months in prison to be followed by two years of supervised release. Mazyck was also ordered to pay $482,671.93 in restitution to the Arkansas Scholarship Lottery (ASL).
During the sentencing hearing today, Mazyck acknowledged responsibility for the theft and apologized to the ASL for his actions and the impact they had on the ASL. The ASL Director, Bishop Woosley, spoke regarding the impact of the actions taken by Mazyck on the ASL stating that, ultimately, it was scholarships for students that were affected by the scheme. Mazyck was released on his own recognizance after the hearing. He is to report to the Bureau of Prisons (BOP) on January 6, 2014, to begin serving his sentence.
“I am grateful for the cooperation of the Arkansas State Lottery and the investigative team of IRS agents and Arkansas State Police detectives for their work, which resulted in a successful prosecution,” stated Thyer. “We are committed to addressing issues of fraud and public corruption in the Eastern District of Arkansas. The success of this mission would not be possible without the law enforcement partnerships we have at all levels – federal, state and local.”
“Public officials hold positions of trust in the community, that trust is broken when officials use their positions to line their own pockets," said Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation Division. "No matter what your position, it is unacceptable to help yourself to other people's money and violate their trust. Individuals who engage in this type of financial fraud should know they will not go undetected and will be held accountable.”
Mazyck pled guilty July 12, 2013, to one count of wire fraud and one count of money laundering. As Deputy Director of Security for the Arkansas Scholarship Lottery, Mazyck had access to packages of promotional lottery tickets, which the lottery routinely gave away at large-scale events such as festivals, fairs, and retailer rallies. Beginning in or about December 2009 through October 2012, Mazyck took lottery tickets from the Arkansas Scholarship Lottery vendor’s warehouse for his personal use. He would assign the tickets to retailers no longer selling tickets, and then use his position as Deputy Director of Security to log into the Arkansas Scholarship Lottery’s software program to change the tickets from “Available-Virgin” to “Promotional.” This change activated the tickets and allowed Mazyck to cash any winning tickets. To hide the scheme, Mazyck would only cash winning tickets of less than $500. This allowed Mazyck to cash his winning tickets at convenience stores all over Arkansas. He then would go into the software program and change the status of all the losing tickets to “Voided by Security.”
This investigation was conducted by IRS-Criminal Investigation and the Arkansas State Police. Assistant United States Attorneys Cameron McCree and Jana Harris have prosecuted this case for the United States.
First Installment of PagliaRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-7725 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistFollow us on Twitter @NDWVnews
PROCEEDS PAID TO DRUG TASK FORCE
Investigation pays big dividends for local departments
CLARKSBURG, WV - Federal authorities presented the Greater Harrison County Drug & Violent Crimes Task Force with a check for over $700,000 today as a down payment on its share of the assets recovered in a large synthetic drug investigation.
Leaders from the DEA, ATF, IRS, U.S. Marshals Service and U.S. Attorney's Office presented a check in the amount of $706,472.13 to the Clarksburg Police Department, the Bridgeport Police Department, and the West Virginia State Police. The money disbursed was the first installment of equitable sharing that will occur as a result of the "Hot Stuff, Cool Things" investigation that began in 2011 and led to arrests, indictments, and convictions in 2012.
According to Task Force board members, the funds received this week will be used by the unit to further its efforts to combat drug trafficking in the area. Additional funds will be disbursed in 2014 once the remaining assets are liquidated. The amount of the next disbursement to the Task Force will depend upon a number of factors, including the amounts received for real estate that has been seized but not yet sold.
According to United States Attorney William Ihlenfeld, II, many of the assets in the case were formerly the property of Jeffrey J. Paglia, the proprietor of stores in Clarksburg & Buckhannon that sold bath salts - a synthetic controlled substance - in violation of federal law. Paglia was indicted in April of 2012 and then convicted in November of 2012 for his role in the distribution of Schedule I Controlled Substances, and Schedule I Analogue Controlled Substances. He was also convicted for the structuring monetary transactions in order to evade reporting requirements. Paglia was sentenced to more than seven years in prison for his crimes.
Co-defendants Jeremia J. Phillips and Derek L. Calip were also convicted in 2012 for their involvement in the distribution of bath salts. They were each sentenced to 21 months in federal prison. John N. Skruck, the fourth defendant named in the indictment, has been on the run since May of 2013 and is still wanted by authorities.
Assets seized in April and May of 2012 included eleven parcels of West Virginia real estate in Clarksburg, Buckhannon, and Lost Creek, and one parcel of real estate in Gardner, Massachusetts. Vehicles seized included a 2011 Ford F-150, a 2011 Honda Crosstour, a 2007 Yamaha Motorcycle, and a 2005 Indian SPCN Motorcycle. Agents also seized a 2008 Bobcat front end loader, a 1998 GMC dump truck, and a Kubota U35 excavator. Multiple bank accounts were also seized.
The Greater Harrison County Drug & Violent Crimes Task Force is comprised of officers and agents from the Clarksburg Police Department, the Bridgeport Police Department, the West Virginia State Police, and the Drug Enforcement Administration. Investigative support for the task force is provided by the Bureau of Alcohol, Tobacco, Firearms & Explosives, the U.S. Marshals Service, and the U.S. Postal Inspection Service.
Firearms Charge Filed Against Canton ManRead the Press Release
A federal grand jury sitting in Cleveland returned a one-count indictment charging Larico Wesley, aka Rico, age 33, of Canton, Ohio, with being a felon in possession of a firearm, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Wesley was arrested on October 31, 2013 by members of the FBI Stark County Safe Street Task Force and Canton Police after an investigation conducted by Canton Police Department.
On August 25, 2013, Canton Police responded to calls of shots fired in the 700 block of Fourth Street, SW. Upon arrival officers observed Wesley pacing near and around a black SUV in the parking lot. Further investigation pertaining to Wesley’s physical location revealed a semi-automatic handgun on the bumper of the vehicle, according to the indictment.
If convicted, his sentence will be determined by the court after review of factors unique to this case, including his prior criminal record, if any, his role in the offenses and the unique characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The case is being prosecuted by Assistant U.S. Attorney Teresa Dirksen.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Federal Grand Jury Criminal Indictments AnnouncedRead the Press Release
TULSA, Okla. — The results of the November 2013 Federal Grand Jury were announced today by Danny C. Williams Sr., United States Attorney for the Northern District of Oklahoma.
The following named individuals have been charged with a federal crime or crimes by the return of an indictment by the Grand Jury. The return of an indictment is a method of informing the defendant of alleged violations which must be proven in a court of law beyond a reasonable doubt to overcome the defendant’s presumption of innocence.
Matthew Todd Bartlett. Sexual Exploitation and Attempted Exploitation of a Child. Bartlett, 38, of Bixby, is charged with having custody and control of a minor, knowingly permitted the minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct, and that visual depiction was produced and transmitted using materials that had been mailed, shipped, and transported in and affecting interstate and foreign commerce by any means, including computer. If convicted, the mandatory minimum is 15 years and a maximum of 30. The U.S. Immigration and Customs Enforcement, Homeland Security Investigations is the lead agency.
Jose Guadalupe Cruz-Torres. Alien in the United States After Deportation. Cruz-Torres, 33, was arrested in Tulsa County and is charged with having returned to the United States unlawfully after being deported in January 2013 near Laredo, Texas. If convicted, Cruz-Torres would face a maximum of twenty years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Michael Lawrence Lefall, Crystal Lynn Kite, and Jessica Jo Glore. Drug Conspiracy and Attempt to Possess Methamphetamine with Intent to Distribute. Lefall, 42, Kite, 32, and Glore, 27, all of Tulsa, are charged with conspiracy and attempt to possess with intent to distribute 50 grams or more of methamphetamine. If convicted, the statutory maximum penalty for drug conspiracy and attempt to possess methamphetamine with intent to distribute is not less than five years imprisonment and not more than 40 years imprisonment, and/or a $5,000,000 fine; count three carries 20 years maximum imprisonment and $1,000,000 fine. The Federal Bureau of Investigation is the lead agency in the case.
Alvaro Omar Cuevas-Bravo. Alien in the United States After Deportation. Cuevas-Bravo, 33, was arrested in Tulsa and is charged with having returned to the United States unlawfully after being deported in October 2004 near Brownsville, Texas. If convicted, Cuevas-Bravo would face a maximum of 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Carolyn Sue Cupples. Steal, Purloin and Knowingly Convert Public Monies and Making a False Report. Cupples, 57, of Tulsa, is charged with stealing on a recurring basis from January 2011, money and objects of value in excess of $1,000 belonging to the United States Postal Service. Cupples, charged with keeping accounts and records, in February and April 2013, falsified with intent to deceive records for all stamp sales. If convicted, the statutory maximum penalty would be not more than 10 years imprisonment and/or a fine of not more than $250,000. The Office of Inspector General U.S. Postal Service is the lead agency.
Joel Deloera-Escalera. Alien in the United States After Deportation. Deloera-Escalera, 33, was arrested in Tulsa and is charged with having returned to the United States unlawfully after being deported in April 2011 near Brownsville, Texas. If convicted, Deloera-Escalera would face a maximum of 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Johnny Howard Coday. Felon in Possession of Firearms, Possession of Methamphetamine with Intent to Distribute, and Possession of a Firearm in Furtherance of a Drug Trafficking Crime. Coday, 50, of Tulsa, is charged with possessing a .20 gauge shotgun, 7.62 X 39 caliber rifle, .22 mini revolver, .22 caliber rifle, possession with intent to distribute 50 grams of more of methamphetamine, and possession of firearms in furtherance of a drug trafficking crime after prior convictions including cultivation of marijuana, possession of a controlled drug with intent to distribute, and possession of a sawed-off shotgun. If convicted, the maximum statutory maximum penalty would be up to 10 years imprisonment, a $250,000 fine; count 2 is no less than five years and not more than 40 years imprisonment, a $5,000,000 fine; and count 3 is not less than five years imprisonment to a maximum life imprisonment, a $250,000 fine. The Federal Bureau of Investigation is the lead agency.
Reco D. Manning. Felon in Possession of Firearm and Ammunition, Possession of Heroin with Intent to Distribute, Possession of Methamphetamine with Intent to Distribute. Manning, 30, of Tulsa, is charged with possessing a Smith & Wesson .38 special caliber revolver and various ammunition, possession of heroin with intent to distribute, and possession of methamphetamine with intent to distribute, all after prior felony convictions in Arkansas. Those convictions include second degree battery and possession of controlled substances with intent to deliver. If convicted, the statutory maximum penalty for felon in possession of a firearm and ammunition is 10 years imprisonment and a maximum fine of $250,000; both the possession of heroin with intent to distribute and possession of methamphetamine with intent to distribute charges carry a maximum penalty of 20 years imprisonment and fine up to $1,000,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives is the lead agency in the case.
Heriberto Murillo-Gonzalez. Attempt to Possess Methamphetamine with Intent to Distribute and Possession with Intent to Distribute Methamphetamine. Murillo-Gonzalez, 31, of Tulsa, is charged with attempting to possess with intent to distribute 50 grams or more of methamphetamine and possession with intent to distribute methamphetamine. If convicted, the maximum statutory penalty would be not less than five years and not more than 40 years imprisonment and a fine not to exceed $5,000,000. The Drug Enforcement Administration and Broken Arrow Police Department are the lead agencies in the case.
Kelvin Antonio Ortega. Possession of Cocaine with Intent to Distribute and Possession of Firearm in Furtherance of Drug Trafficking Crime. Ortega, 31, of Tulsa, is charged with possession with intent to distribute cocaine and possession of a 9mm semi-automatic pistol in furtherance of a drug trafficking crime. If convicted, the statutory maximum penalty for possession of cocaine with intent to distribute would be not more than 20 years imprisonment, a fine of $1,000,000; possession of firearm in furtherance of drug trafficking crime penalty would be not less than five years imprisonment up to life imprisonment, to run consecutively, and a fine not to exceed $250,000. The Drug Enforcement Administration and Tulsa Police Department are the lead agencies in the case.
Gregorio Sanchez-Hernandez. Alien in the United States After Deportation. Sanchez-Hernandez, 38, was arrested and is charged with having returned to the United States unlawfully after being deported in November 2009 near Laredo, Texas. If convicted, Sanchez-Hernandez would face a maximum of 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Noe Israel Trejo-Galindo. Alien in the United States After Deportation. Trejo-Galindo, 34, was arrested and is charged with having returned to the United States unlawfully after being deported in July 2007 near Houston, Texas. If convicted, Sanchez-Hernandez would face a maximum of 20 years imprisonment and/or a fine up to $250,000. The U.S. Immigration and Customs Enforcement is the lead agency.
Demetrice Woodard. Possession of Firearm After Conviction for Misdemeanor Crime of Domestic Violence and Felon in Possession of Firearm. Woodard, 33, of Tulsa, is charged with possession of a .380 caliber semi-automatic pistol after having being convicted of felony crimes including domestic assault and battery in the presence of a minor and trafficking controlled substance. If convicted, the maximum statutory penalty would be 10 years imprisonment and a $250,000 fine, along with the forfeiture of the firearm. The Bureau of Alcohol, Tobacco, Firearm and Explosives is the lead agency in the case.
Federal Court in Ohio Shuts Down Nation’s Fourth-Largest<br /> Tax-Preparation Firm and Bars CEO from Tax-Preparation BusinessRead the Press Release
Judge Finds that Instant Tax Service Franchisor Defrauded Customers, Obstructed the IRS and Violated Court Orders on Lending Practices
A federal court has entered a permanent injunction ordering ITS Financial LLC, the parent company of the Instant Tax Service franchise, to cease operating, the Justice Department announced today. The injunction order, which was signed yesterday by Judge Timothy S. Black of the U.S. District Court for the Southern District of Ohio, also bars Fesum Ogbazion, the sole owner and CEO of ITS Financial, from operating or being involved with any business relating to tax-return preparation. The court issued the order following a two-week trial in Cincinnati in June 2013.
Instant Tax Service, which is based in Dayton, Ohio, claimed to be the fourth-largest tax-preparation firm in the nation. According to the court, ITS Financial had about 150 franchisees that filed over 100,000 tax returns each year in 2011 and 2012. Two other entities owned by Ogbazion, Tax Tree LLC and TCA Financial LLC, were also defendants in the case and were also ordered to cease operating.
The court found that Ogbazion and his defendant companies had:
· Filed tax returns for customers without their permission and encouraged franchisees to do the same;
· Clandestinely trained and encouraged franchisees to prepare and file tax returns prematurely with paycheck stubs that omitted and understated income and inevitably resulted in the submission of false federal tax returns;
· Defrauded customers, who were largely low-income, by marketing false and fraudulent loan products to lure them into the tax-preparation offices;
· Defrauded customers by requiring franchisees to charge phony and exorbitant fees;
· Forged customers’ signatures on loan checks and used those forged checks to operate Ogbazion’s businesses;
· Willfully failed to pay over $1 million of their own employment taxes and lied about assets in connection with the collection of those taxes, while hiding money in a secret bank account and defrauding the United States and third party creditors;
· Lied on government forms and encouraged franchisees to do the same;
· Obstructed government agents and materially assisted franchisees in circumventing Internal Revenue Service (IRS) law-enforcement efforts involving the suspension of electronic filing identification numbers; and
· Told franchisees to lie to government agents in connection with IRS compliance visits.
The court credited an IRS study concluding that the tax harm caused by Instant Tax Service franchisees in five cities in a single tax-filing season was between $10 million and $25 million.
“Defendants’ harm to the public is extensive and egregious, indeed appalling,” the court stated. “This is especially so given the nature of Instant Tax Service’s core customer – the working poor – who are particularly vulnerable to [the] Defendants’ fraudulent practices.”
The court further stated: “Defendants’ repeated attempts at trial and in argument to downplay the gravity of their lawlessness was stunning. The court concludes that even today [the] Defendants have not fully recognized their culpability. Ultimately, the nature, scope and gravity of [the] Defendants’ offenses, and the unrepentant attitude toward their commission, demonstrate the necessity for a complete injunction putting the Defendants permanently out of business.”
The court also concluded that Ogbazion and ITS Financial violated the terms of a preliminary injunction order that the court had entered in October 2012 with their consent. The court found that, despite their agreement to obey various lending and consumer-protection laws during the 2013 tax filing season, they violated several of those laws by discriminating against active-duty military personnel on loan applications and by failing to obtain a state lending license in a timely manner. The court determined that they violated the preliminary injunction by causing their franchisees to provide tens of thousands of customers with Truth-in-Lending Act disclosure forms falsely stating that the loans carried no finance charges and an annual percentage rate (APR) of zero.
“We are gratified by the court’s decision, which serves to protect hard-working taxpayers who were targeted by Instant Tax Service, and also safeguards all honest taxpayers from the harm done by fraudulent tax filings,” said Assistant Attorney General Kathryn Keneally of the Justice Department’s Tax Division. “As described by the court, this company grew large through abhorrent means – filing returns without customer authorization, forging customer signatures, pushing fraudulent loan products, and much more. As the court’s decision recognizes, a business model based on false and fraudulent conduct cannot be allowed to prevail.”
“The court's decision sends a clear message to those who might be tempted to abuse the public trust provided to the tax preparer community,” said Acting IRS Commissioner Danny Werfel. “Those who deceive their customers and defraud the U.S. Treasury will face swift legal action that puts an end to their corrosive conduct."
Assistant Attorney General Keneally thanked former and current Tax Division trial attorneys Nathan Clukey, Sean Green, Russell Edelstein, Jose Olivera and Gregory Van Hoey, along with paralegal Mahana Karimi, for their efforts on the case. She also thanked the many IRS attorneys and agents who participated in the investigation.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2013 . The Internal Revenue Service has tips for choosing a tax preparer: www.irs.gov/Tax-Professionals/Choosing-a-Tax-Professional . In the past decade, the department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the department website .
Federal and State Charges Filed in Joint Investigation Involving Mississippi Department of Marine ResourcesRead the Press Release
Gulfport, Miss – Federal and state grand juries returned indictments this week following a joint investigation into the activities of the Mississippi Department of Marine Resources (“DMR”) and a $3 million grant issued to the City of D’Iberville, announced U.S. Attorney Gregory K. Davis, FBI Special Agent in Charge Daniel McMullen, Mississippi State Auditor Stacey Pickering, Second Circuit District Attorney Joel Smith and Nineteenth Circuit District Attorney Tony Lawrence. The State Auditor’s Office also issued civil demands totaling more than $1 million.
William W. Walker, 68, of Ocean Springs, Scott J. Walker, 34, of Ocean Springs, Sheila Tina Shumate, 52, of Saucier, and Joseph C. Zeigler, Jr., 66, of Gulfport, have been named in a five-count federal indictment, returned on Tuesday, November 5, 2013, charging conspiracy to commit federal program fraud, federal program fraud, conspiracy to commit mail fraud and mail fraud involving DMR and the Mississippi Marine Resources Foundation.
Scott J. Walker is also named in a separate federal indictment along with Michael Janus, age 47, of Biloxi, charging conspiracy to commit program fraud, program fraud, bribery in connection with a federal program and money laundering. The indictment alleges that Walker and Janus caused a false invoice in the amount of $180,000 to be submitted to the City of D’Iberville for payment of consulting services.
A Harrison County grand jury returned indictments this week against Sheila Tina Shumate, Leslie Young Gollott, Susan Perkins, Jere Grant Larsen, Jr. and Kerwin Cuevas for multiple counts of fraud and embezzlement which allegedly occurred during their employment with the Department of Marine Resources.
In addition, the Mississippi State Auditor’s Office issued demands against ten individuals as part of this investigation totaling $1,022,308.55. The individual demands are listed below:
William Walker $362,689.14
Joseph Ziegler $258,268.75
Sheila Shumate $127,608.57
Leslie Gollott $117,593.10
Susan Perkins $ 30,959.34
Grant Larson $ 1,342.08
Kerwin Cuevas $108,420.70
Walter Chataginer $ 1,279.85
Kerry Endris $ 13,020.66
Samantha Hebert $ 1,126.36
“The indictments and demands announced today are one step toward restoring the trust of taxpayers, but they do not close the investigation,” State Auditor Stacey Pickering said. “As alleged in the indictments, these men and women abused their positions, stole from the taxpayers of Mississippi, and they will be held accountable for their actions. I appreciate the hard work and cooperation from the local, state and federal agencies involved including our
Special Agents, District Attorneys Joel Smith and Tony Lawrence, Gregory Davis, U.S.
Attorney for the Southern District, and Daniel McMullen, Special Agent in Charge for the
Federal Bureau of Investigation.”
The public is reminded that an indictment is an allegation that a defendant has committed a crime. All defendants are presumed innocent until and unless proven guilty.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
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Help us combat the proliferation of sexual exploitation crimes against children.
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Fairport Woman Charged with Felony for Lying to Federal AgentsRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Ann Marie Laurini, 48, of Fairport, N.Y., was charged by criminal complaint with lying to Special Agents of the Internal Revenue Service. The carries a maximum sentence of five years in prison, a fine of $250,000, or both.
Assistant U.S. Attorney John J. Field, who is handling the case, stated that according to the complaint, Laurini repeatedly lied to IRS agents in connection with an investigation of Kenneth Griffin and others into financial fraud and money-laundering crimes. The defendant was employed by Griffin from March 2006 to May 2008, and engaged in acts that furthered the financial fraud. Laurini was interviewed by federal agents on several occasions concerning her knowledge and involvement in the fraud and during those interviews she falsely stated that she had not engaged in various acts of deception in furtherance of the fraud. The investigation ultimately resulted in charges against Kenneth Griffin, Brian Campbell, and two others, all of whom have been convicted.
“Lying to a government official is not only unacceptable but it is criminal,” said U.S. Attorney Hochul. “Our Office will vigorously prosecute any attempts to interfere with the efforts of any federal investigation.”
IRS Special Agent in Charge Weirauch said, “Simply stated, lying to a law enforcement officer conducting an official criminal investigation undermines the pursuit of justice. For this very reason, the government considers lying to a federal agent a very serious matter and will investigate such allegations and criminally prosecute those responsible.”
Laurini made an initial appearance this afternoon before U.S. Magistrate Judge Marian W. Payson and was released on her own recognizance. The defendant is due back in court on January 8, 2014, at 9:00 a.m.
The criminal complaint is the culmination of an investigation by Special Agents of the Internal Revenue Service, under the direction of Special Agent in Charge Toni Weirauch, and the Federal Bureau of Investigation, under the direction of Brian P. Boetig, Special Agent in Charge.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.Enosberg Falls Man Sentenced for Child Exploitation OffenseRead the Press Release
The Office of the United States Attorney for the District of Vermont stated today that David Ritchie II, 23, of Enosburg Falls, Vermont, was sentenced on October 16, 2013, in United States District Court in Rutland, Vermont, to serve eight-months imprisonment following his guilty plea to one count of possession of child pornography. Chief United States District Judge Christina Reiss also ordered the defendant to serve a five-year term of supervised release and to pay a $100 special assessment.
United States Attorney Coffin commended the work of the Homeland Security Investigations, Department of Homeland Security, and the Vermont Internet Crimes Against Children Task Force. Mr. Ritchie was represented by Assistant Federal Defender Steven L. Barth. The case was prosecuted by Assistant United States Attorney Barbara A. Masterson.
United States Attorney Coffin noted that this prosecution is part of the U.S. Department of Justice's Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorneys Offices and the Internet Crimes Against Children Task Force, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
East St. Louis Man Pleads Guilty to Failure to Register as A Sex OffenderRead the Press Release
On November 6, 2013, Jason C. Bryant, a thirty-one year old East St. Louis, Illinois, man pled guilty in federal district court, in East St. Louis, to failure to register as a sex offender, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Bryant is scheduled for sentencing on February 28, 2014. He faces a term of imprisonment of up to ten (10) years, a fine up to $250,000, or both, and a term of supervised release of five (5) years to life of supervised release, and a mandatory special assessment of $100.
On May 2, 2011, Bryant was released from prison in the State of Indiana following his conviction there for cocaine distribution. Upon his release, he immediately moved to Illinois without registering as a sex offender in the state. Bryant was required to register as a sex offender in Illinois within three days of his move from Indiana to Illinois. The registration was due to his Criminal Sexual Assault conviction on March 24, 2000, in St. Clair County, Illinois.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices, Project Safe Childhood marshals federal, state and local resources to better 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.
The case was investigated by the United States Marshals Service and is assigned to Assistant United States Attorney Daniel T Kapsak.
Dominican Man Pleads Guilty to Social Security and Passport FraudRead the Press Release
BOSTON - A Dominican man pleaded guilty today to theft of public money and passport fraud.
Antonio Pulinario Brea, 55, pleaded guilty to theft of public money and two counts of making a false statement in a passport application. In July 2013, Brea was indicted. Sentencing is scheduled for January 31, 2014.
From 2004 to 2013 Brea illegally received more than $60,000 in Social Security disability payments under another person's identity. He also used the alias to apply for United States passports in 2010 and 2011.
United States Attorney Carmen M. Ortiz; Scott Antolik, Special Agent in Charge of the Office of Inspector General, Social Security Administration, Office of Investigations, Boston Field Division; Bruce M. Foucart, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Boston; and David Hall, Special Agent in Charge of the U.S. Department of State’s Bureau of Diplomatic Security’s Boston Field Office, made the announcement today. The case is being prosecuted by Special Assistant U.S. Attorney Timothy Landry of Ortiz’s Major Crimes Unit.
District Man Sentenced to Three Years in PrisonFor Possession of Child PornographyRead the Press Release
WASHINGTON – Dustin Metz, 30, of Washington, D.C., was sentenced today to three years in prison on a federal charge of possession of child pornography, announced U.S. Attorney Ronald C. Machen Jr., Scot Rittenberg, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigations (HSI), Washington, D.C., and Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD).
Metz pled guilty in July 2013 in the U.S. District Court for the District of Columbia. He was sentenced by the Honorable Senior Judge Royce C. Lamberth. Upon completion of his prison term, Metz will be placed on 10 years of supervised release. He also will be required to register as a sex offender for 15 years.
According to the government’s evidence, between September 2012 and April 2013, Metz possessed child pornography on his personal computer at his residence in Washington, D.C. On various dates during that time-frame, Metz used a peer-to-peer file sharing program to download to his computer numerous images and videos depicting child pornography and at the same time make those images and videos available for other users of the program to download themselves. Metz viewed the images and videos and then deleted them.
On April 17, 2013, law enforcement executed a search warrant at Metz’s home and seized various items, including two laptop computers. Law enforcement subsequently discovered evidence showing that Metz had possessed child pornography on both of the computers, including at least one video depicting child pornography and remnants of additional video and image files indicative of child pornography. Metz was arrested on May 9, 2013.
In announcing the sentence, U.S. Attorney Machen, Acting Special Agent in Charge Rittenberg, and Chief Lanier praised the work of the HSI special agents and MPD detectives who investigated the case. They also commended the efforts of Assistant U.S. Attorney Cassidy Kesler Pinegar, who prosecuted the case.
13-383District Man Sentenced to 40 Months in Prison for Armed Robbery Outside Restaurant-Security Footage and Citizens’ Tips Helped Lead Police to Defendant-Read the Press Release
WASHINGTON - James E. Wade, 30, of Washington, D.C., was sentenced today to 40 months in prison on an armed robbery charge stemming from a hold-up last spring outside a Northwest Washington restaurant, U.S. Attorney Ronald C. Machen Jr. announced.
Wade pled guilty in September 2013 the Superior Court of the District of Columbia. He was sentenced by the Honorable Robert I. Richter. Upon completion of his prison term, Wade will be placed on five years of supervised release.
According to the government’s evidence, on May 17, 2013, at approximately 9:20 p.m., the two victims were dining at a table in front of a restaurant in the 1400 block of 12th Street NW when Wade approached them. He was brandishing what appeared to be a handgun. Wade demanded the victims’ property, and the two men turned over their cash, wallet, and cell phone. After taking the property, Wade fled.
Footage from the restaurant’s security camera was released to the public through various media outlets, along with a number for the Metropolitan Police Department (MPD). The police received many calls from citizens on the tip line identifying the suspect in the video as Wade. Others who were familiar with Wade also identified him as the perpetrator of the robbery. On June 8, 2013, police officers located Wade and placed him under arrest.
In announcing the sentence, U.S. Attorney Machen commended those who investigated the case for the MPD as well as the citizens who came forward. He also acknowledged the efforts of Assistant U.S. Attorney Scott Sroka, who investigated and prosecuted the case.
13-381Detroit-Area Home Health Care Agency Owner Sentenced for Role in $2.2 Million Medicare Fraud SchemeRead the Press Release
The owner of a Detroit-area home health care agency was sentenced today to serve 65 months in prison for her leading role in a $2.2 million Medicare fraud scheme.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office, and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations’ Detroit Office made the announcement.
Mehran Javidan, 51, was sentenced by U.S. District Judge Denise Page Hood in the Eastern District of Michigan. In addition to her prison term, Javidan was sentenced to serve three years of supervised release and was ordered to pay $2.2 million in restitution, jointly and severally with her co-defendants.
Javidan was convicted by a federal jury on April 2, 2013, of one count of conspiracy to commit health care fraud, three counts of health care fraud, three counts of making false statements related to health care matters and one count of conspiracy to solicit or pay health care kickbacks in exchange for referrals of patients to home health care company Acure Home Care Inc. (Acure). The jury found Javidan not guilty of one count of making false statements and one count of health care fraud and did not reach a verdict on one additional count of health care fraud.
Javidan was initially charged along with two other defendants in an indictment unsealed on Feb. 17, 2011, as part of a nationwide Medicare fraud takedown. One co-defendant was also convicted on April 2, 2013, while the other remains a fugitive.
According to evidence presented at trial, Javidan owned and operated Acure, a home health care company in Oak Park, Mich., and later Troy, Mich. Javidan paid doctors to refer non-homebound patients for physical therapy treatment that was medically unnecessary. The evidence showed that she also paid patient recruiters to obtain Medicare information and pre-signed physical therapy documents from Medicare beneficiaries. The recruiters for Acure obtained the Medicare information and pre-signed forms by paying patients in cash and by promising that the referring doctors would prescribe them narcotic prescriptions.
Evidence presented at trial established that Javidan paid physical therapists and physical therapy assistants employed by Acure to create false and fraudulent physical therapy files using the blank, pre-signed forms to make it appear as if physical therapy services were actually rendered, when in fact, the services had not been rendered.
Javidan then directed the submission of Acure’s falsified billing to Medicare. Acure was paid more than $2.2 million from Medicare between December 2008 and November 2010.
The investigation was led by the FBI and HHS-OIG and was brought by 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 Michigan. The case was prosecuted by Assistant Chief Catherine K. Dick and Trial Attorney Niall M. O’Donnell of the Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in Chicago and eight other cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.Dentist Pleads Guilty to Filing False Tax ReturnRead the Press Release
Jeffrey Paper of Potomac, Md., pleaded guilty yesterday to willfully filing a false tax return in the U.S. District Court in Greenbelt, Md., the Justice Department and the Internal Revenue Service (IRS) announced today.
According to court documents, Paper owned and operated a dental practice located in Lanham, Md., between 2008 and 2010. For the 2009 and 2010 tax years, Paper underreported the total gross receipts from his dental practice and overstated his business expenses on his individual income tax returns. As a result of his conduct, the total tax loss to the government was $215,711.
Paper faces a maximum sentence of three years in prison, one year of supervised release and a $250,000 fine. Sentencing is scheduled for March 10, 2014.
This case was investigated by special agents of IRS – Criminal Investigation. Trial Attorney Erin B. Pulice of the Department’s Tax Division is prosecuting the case, with the assistance of Assistant U.S. Attorney Kelly Hayes of the U.S. Attorney’s Office for the District of Maryland.
Davenport Man Sentenced to 20 Years in Prison for Conspiracy to Distribute Cocaine BaseRead the Press Release
DAVENPORT, IA – On November 6, 2013, McFerry Tolbert, Jr., age 30, was sentenced by United States District Judge John A. Jarvey to 240 months in prison for conspiracy to distribute, and possess with intent to distribute, 280 grams or more of cocaine base, announced United States Attorney Nicholas A. Klinefeldt. Tolbert was also ordered to serve five years of supervised release following the imprisonment, and to pay $100 towards the Crime Victims Fund.
Beginning in approximately June 2012 and continuing until about November 27, 2012, Tolbert purchased cocaine base, also known as “crack,” and conspired with others to redistribute the drug in the Davenport, Iowa area. As part of the investigation, Davenport police conducted several controlled purchases of cocaine base from Tolbert in October and November 2012. Law enforcement officers also executed a search warrant at Tolbert’s Davenport residence and seized, among other items, cocaine base and a digital scale. When Tolbert was arrested he had 14 individually packaged pieces of cocaine base on his person.
This case was investigated by the Davenport, Iowa, Police Department, the United States Drug Enforcement Administration, and the Iowa Department of Public Safety - Division of Narcotics Enforcement. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Connecticut Insulation Contractor Admits Operating Fraud SchemeRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that EDWARD PETRUCCI, 56, of Orange, waived his right to indictment and pleaded guilty today before Senior U.S. District Judge Alfred V. Covello in Hartford to wire and mail fraud charges.
According to court documents and statements made in court, PETRUCCI operated Womco Insulation, Inc., Incor Group, Inc., D & N Insulation Company, and Petco Insulation Company, all of which were West Haven-based companies that performed construction services, mechanical insulation and asbestos removal in large-scale building projects in Connecticut, New York, Massachusetts and Florida.
In 2006, PETRUCCI, who had just been released from federal prison, was unable to secure funding from a bank so he started doing business with Platinum Funding Services, LLC, a New York factoring company that provided funding to client companies. A factoring company typically purchases a company’s receivables at a discount, providing the company with liquid assets at a discounted rate while purchasing the right to collect on the purchased receivables at a later date.
In the beginning of their relationship, Platinum regularly purchased PETRUCCI’s invoices from legitimate insulation jobs throughout Connecticut and collected on those invoices without any serious problems. However, from approximately December 2007 to April 2009, PETRUCCI defrauded Platinum by causing his companies to sell invoices to Platinum that PETRUCCI knew were fake, and which were for work that his companies had not performed and, in many cases, would not perform in the future.
Through this scheme, PETRUCCI’s companies received more than $1 million in payments from Platinum that were based on the fraudulent invoices.
PETRUCCI pleaded guilty to one count of wire fraud and one count of mail fraud. Judge Covello has scheduled sentencing for January 30, 2014, at which time PETRUCCI faces a maximum term of imprisonment of 20 years on each count.
In May 2005, PETRUCCI was sentenced to a federal prison term for filing false corporate and personal tax returns and evading the payment of more than $1 million in federal income taxes.
This matter has been investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Robert M. Spector.
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(203) 821-3722 [email protected]Cleveland Man Indicted for Using A Firearm to Rob Richmond Heights BankRead the Press Release
A federal grand jury returned a two-count indictment charging Marcus Cross, age 23, of Cleveland, with armed bank robbery and using a firearm during the commission of a felony, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Cross robbed a Huntington Bank in Richmond Heights, Ohio, stole approximately $2,306 from the bank, and discharged a firearm during the commission of the robbery.
If convicted, Cross’ sentence will be determined by the Court after review of factors unique to this case, including Cross’ prior criminal record, if any, his role in the offense and the unique characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum
The case is being prosecuted by Assistant U.S. Attorney Adam J. Hollingsworth following an investigation by the Federal Bureau of Investigation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt
Cleveland Man Indicted for Robbing Garfield Heights BanksRead the Press Release
A grand jury returned a one-count indictment charging Daniel Leotto Johnson, 44, of Cleveland, with bank robbery, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Johnson robbed U.S. Bank, 5695 Turney Road, Garfield Heights, Ohio, on October 15, 2013.
The case is being prosecuted by Assistant U.S. Attorney Justin Seabury Gould, following investigation by agents of the Federal Bureau of Investigation, and members of the Garfield Heights Police Department.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Chicago Man Sentenced on Drug ChargesRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Salah Mohamed Ahmed, 37, of Chicago, Ill., who was convicted of conspiracy to distribute 50 kilograms or more of marijuana, was sentenced to 12 months in prison by Chief U.S. District Judge William M. Skretny.
Defendants Abdulfatah Mosed, Mohamed Taher, Basheer Saleh, Yasin Abdulla and Bradley Parry were previously convicted of conspiracy to possess with intent to distribute marijuana.
Assistant U.S. Attorney Timothy C. Lynch, who handled the case, stated that between late 2005 and May of 2007, Mohamed Taher operated a criminal enterprise that employed five or more individuals including the defendant. The enterprise imported marijuana into the United States from Canada, and then distributed the marijuana to customers in Detroit, Chicago and Buffalo. Salah Mohamed Ahmed assisted Taher by distributing quantities of marijuana in the City of Chicago.
Taher was convicted of the charges following a four week jury trial before Chief U.S. District Judge William M. Skretny. Defendant Kaleel Albanna was acquitted of similar charges.
The sentencing is the culmination of an investigation on the part of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Brian P. Boetig, Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero, Customs and Border Protection, under the direction Randy Howe, Acting Director of Field Operations, the New York State Police, under the direction of Major Michael Cerretto, the Michigan State Police and the Willoughby Hills, Ohio Police Department.Chicago Man Sentenced to More Than 13 Years in Federal Prison for Transporting and Possessing Child PornographyRead the Press Release
CHICAGO — A Chicago man who collected thousands of images and hundreds of videos of child pornography was taken into federal custody after he was sentenced yesterday to 13 years and 4 months in federal prison for transporting and possessing child pornography using his home computers. The defendant, JONATHAN SAINZ, 28, had pleaded guilty in June of this year. He was charged in October 2011 after federal agents searched his residence earlier that year.
Sainz was sentenced to 160 months in prison, followed by five years of supervised release, by U.S. District Judge Samuel Der-Yeghiayan. He must serve at least 85 percent of his federal sentence before he is eligible for release and there is no parole in the federal prison system. Transporting child pornography carries a mandatory minimum sentence of five years and a maximum of 20 years in prison, while possessing child pornography carries a maximum of 10 years in prison.
Sainz was also ordered to pay $8,387 in restitution to a specific child pornography victim, whose image he possessed and who was identified by the National Center for Missing and Exploited Children (NCMEC) as a result of previous unrelated investigations.
According to court records, in December 2010, an undercover law enforcement agent engaged in an online chat with Sainz, during which the agent downloaded approximately eight videos and 44 images of child pornography from files made available for sharing by Sainz. FBI agents subsequently linked the internet account used during the chat to Sainz’s residence. Ultimately, Sainz was found to possess approximately 3,820 images and 222 videos of child pornography on his home computers. The images and videos included depictions of extremely young children, including toddlers, being sexually assaulted.
The investigation was conducted by the FBI’s Child Exploitation Task Force. The task force is part of a nationwide effort known as the Innocence Lost National Initiative targeting those involved in the commercial sexual exploitation of children in the United States. In Chicago, the CETF is comprised of FBI special agents and officers and investigators from the Chicago Police Department, the Cook County Sheriff's Office, and the Cook County State’s Attorney’s Office.
The sentence was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois, and Robert J. Shields, Jr., Acting Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The government was represented by Assistant U.S. Attorney Bolling W. Haxall.
Chicago Lawyer Permanently Barred from Promoting Tax-Fraud Schemes and Preparing Related Tax ReturnsRead the Press Release
A federal court has permanently barred Gary J. Stern from promoting tax fraud schemes and from preparing related tax returns, the Justice Department announced today. The civil injunction order, to which Stern consented without admitting the allegations against him, was entered by Judge Robert Gettleman of the U.S. District Court for the Northern District of Illinois. The order permanently bars Stern from preparing various types of tax returns for individuals, estates and trusts, partnerships or corporations (IRS Forms 1040, 1041, 1065, and 1120), among others. The United States alleged that Stern used those returns to facilitate the unlawful schemes identified in the complaint.
According to the complaint, Stern designed at least three tax-fraud schemes that helped hundreds of customers falsely claim over $16 million in improper tax credits and avoid paying income tax on at least $3.4 million. Stern allegedly promoted the schemes to customers, colleagues, and business associates. The complaint alleges that his customers included lawyers, entrepreneurs and professional football players, and some of the latter, including NFL quarterback Kyle Orton, have sued Stern in connection with the tax scheme, alleging fraud, breach of fiduciary duty and professional malpractice.
Federal law allows an income tax credit with respect to certain sales of fuel from non-conventional sources (FNS), including methane produced from landfills. According to the complaint, beginning in the early 2000’s Stern created a web of partnerships, companies and other entities to serve as a conduit for sham transactions designed to funnel false FNS credits to his customers. Stern allegedly funneled over $11.4 million of these bogus FNS credits to customers and used a bogus trust arrangement to fraudulently distribute an additional $5.34 million in FNS credits to his customers.
Finally, according to the complaint, Stern promoted an abusive income-shifting technique to help his wealthiest customers illegally avoid taxes. Stern and his business associates allegedly kept most of the money that customers contributed to this scheme. The court has barred Stern from using any entity to assist others in illegally shifting income for the purpose of avoiding tax.
Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2013 . The IRS has tips for choosing a tax preparer: www.irs.gov/Tax-Professionals/Choosing-a-Tax-Professional . In the past decade, the Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the department website .
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United States v. Gary J. Stern
Final Judgment of Permanent Injunction ReliefCecil County Prescription Drug Dealer Sentenced to over 8 Years in PrisonRead the Press Release
Total of 15 Defendants Convicted in the Conspiracy
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced David Graham, age 63, of Elkton, Maryland, today to 97 months in prison, followed by three years of supervised release, for conspiracy to distribute oxycodone.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Cecil County Sheriff Barry A. Janney, Sr. and Colonel Marcus L. Brown, Superintendent of the Maryland State Police.
According to his plea agreement between 2008 and 2010, Graham was part of a conspiracy that distributed prescription drugs in and around Cecil County, Maryland. Graham and co-conspirator Matthew Ward paid individuals to go into doctors’ offices, obtain large prescriptions for oxycodone and other pills, and then sell many of the pills they obtained to Graham and Ward. Graham and Ward would then sell the pills to individual users.
Intercepted telephone communications made clear that Graham had numerous people obtaining pills for him from doctor’s offices and pharmacies. Many of these individuals were drug addicts who would sell Graham drugs to feed their addiction. Graham was not a drug user and was engaged in the enterprise to make money.
At the time of Graham’s arrest in November, 2010, a search was conducted at his residence. Law enforcement recovered $9,120 in cash, eight cellphones and numerous prescription pills, including hundreds of oxycodone, morphine and Dilaudid pills. In addition, Graham possessed 17 firearms, including eight rifles, four shotguns, a revolver, a semi-automatic pistol and a 12 gauge.
Graham admitted that between 2008 and 2010, the co-conspirators distributed approximately 1.4 million milligrams of oxycodone.
Co-defendant Matthew Earl Ward, age 33, of Elkton, Maryland, was previously sentenced to 10 years in prison. Ward was convicted after an eight day trial of conspiracy to distribute, and possess with intent to distribute oxycodone and alprazolam. Thirteen other conspirators were also convicted and sentenced to between 18 months and eight years in prison
United States Attorney Rod J. Rosenstein commended the DEA, FBI, Cecil County Sheriff’s Office and Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Joshua Kaul and Mushtaq Gunja, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Cameron T. Jones Pleads Guilty and Sentenced in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on October 31, 2013, before U.S. Magistrate Judge Keith Strong, CAMERON T. JONES, a 22-year-old resident of Bethel, Connecticut, pled guilty and was sentenced to a term of:
- ison: 30 days with 30 days suspended
- ecial Assessment: $15
- ne: $2,500
JONES was sentenced in connection with his guilty plea to.theft of government property.
In an Offer of Proof filed by Special Assistant U.S. Attorney David Dayton and Assistant U.S. Attorney Laura B. Weiss, the government stated it would have proved at trial the following:
In September 2012, JONES was enlisted in the United States Air Force where he worked as a member of the Security Forces on Malmstrom Air Force Base (MAFB). In an interview with law enforcement, JONES admitted to taking an Advanced Combat Optic Gunsight (ACOG) valued at under $1,000 from MAFB. JONES stated he knew where the ACOG was located because he had moved furniture into the room where it was located the previous month. JONES admitted he drove to Walmart where he purchased bolt cutters. He then drove to the building housing the ACOG and cut the lock from the storage locker with the bolt cutters and took the ACOG.
The stolen government property in this case came to law enforcement's attention in November 2012, after it was discovered the ACOG was missing and a witness overheard someone mention their friend had taken the ACOG. During the course of the investigation, law enforcement located a witness/co-conspirator who admitted to driving JONES to Walmart and disclosed that JONES told him about his plan to take the government property.
After admitting to taking the government property, JONES returned an ACOG by mail, and it was positively identified as the ACOG he stole.
The investigation was conducted by the U.S. Air Force Office of Special Investigation.
California Man Charged with Threatening Four in Stark CountyRead the Press Release
A federal grand jury sitting in Cleveland returned a four-count indictment charging Daniel Dillon, age 50, of Los Angeles, with making interstate threatening communications, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment alleges that Dillon sent threatening communications from California to Ohio. The communications, by fax, e-mail and voicemail, contained threats to injure and kill four victims, including a Stark County judge, a Stark County public official, a court-appointed guardian and the guardian’s attorney.
The indictment resulted from an investigation conducted by the Federal Bureau of Investigation in Canton, Ohio and the case is being prosecuted by Assistant U.S. Attorney Nancy Kelley.
If convicted, his sentence will be determined by the Court after review of factors unique to this case, including his prior criminal record, if any, his role in the offenses and the unique characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Buffalo Man Charged with Mortgage FraudRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Michael Rory Woods, 44, of Buffalo, N.Y., was charged by criminal complaint with making false statements on a loan application in order to secure a refinance mortgage. The charges carry a maximum penalty of 30 years in prison, a fine of $ 1,000,000, or both.
Assistant U.S. Attorney Kathleen A. Lynch, who is handling the case, stated that according to the complaint, the defendant falsely inflated the income of a borrower on a loan application submitted to JP Morgan Chase Bank. The borrower, James P. Vasiliou, Jr., previously pleaded guilty to bank fraud in connection with making a false statement on a bank mortgage application.
The complaint alleges that Woods, through his mortgage brokerage firm, Buffalo Equity, submitted an application for a refinance mortgage inflating Vasiliou’s income by thousands of dollars. A week later, Woods submitted another application on behalf of Vasiliou for a refinance mortgage on the same property that grossly inflated Vasiliou’s income three times as much as the income listed on the first application. The second loan was approved based on the exaggerated income of Vasiliou. As a result of the scheme, JP Morgan Chase Bank suffered a loss.
The criminal complaint is the result of an investigation by the Mortgage Fraud Task Force of WNY, led by the U.S. Attorney’s office, which includes agents and personnel from the United States Secret Service under the direction of Special Agent in Charge Tracy Gast and the Federal Bureau of Investigation under the direction of Special Agent in Charge Brian P. Boetig.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.Boise Man Pleads Guilty in Federal Court to Unlawfully Possessing FirearmsRead the Press Release
BOISE – Jason Earl Wright, 39, of Boise, Idaho, pleaded guilty today in United States District Court to unlawful possession of firearms and ammunition, U.S. Attorney Wendy J. Olson announced.
According to court records, in June 2013, Wright attempted to purchase a scope for an AK-47 advertised on Craigslist. The seller, an Idaho Department of Correction Probation and Parole Officer, discovered that on December 19, 2006, Wright was convicted of possession of a controlled substance with the intent to deliver, a felony with a term of imprisonment exceeding one year. Wright was contacted by an undercover law enforcement agent regarding the transaction, after which Wright agreed to trade ammunition and a gun safe for the rifle scope. Based on conversations between the agent and Wright, a federal search warrant was obtained and executed at Wright’s Boise residence on June 27, 2013. Before serving the warrant, the undercover agent arranged to meet with Wright to complete the trade. Wright’s vehicle was subsequently stopped by Ada County Sheriff’s Office deputies. Wright was found to be in possession of 13 rounds of ammunition. Law enforcement recovered 14 firearms and over 2,000 rounds of ammunition at Wright’s residence.
Wright faces up to ten years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Sentencing is set for January 23, 2014, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Boise.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Ada County Sheriff’s Office, and Boise Police Department.
Wright was prosecuted as part of Idaho’s Project Safe Neighborhoods Program, which seeks to reduce gun violence in Idaho.
Biloxi Woman Pleads Guilty to Oil Spill FraudRead the Press Release
Gulfport, Miss. – Brandy Ann Jarrell, 37, of Biloxi, pled guilty in U.S. District Court today to mail fraud in connection with the Deepwater Horizon Oil Spill, U.S. Attorney Gregory K. Davis announced.
Jarrell admitted carrying out a scheme to defraud the BP Gulf Coast Claims Facility by making false claims for damages. She claimed she lost earnings and profits from her employment as a deckhand on an oyster boat in a south Mississippi harbor as a result of the Deepwater Horizon Oil Spill when, in fact, she did not work on the oyster boat and did not lose earnings and profits. As a result of her false claim, Jarrell received an Emergency Advance Payment check in the amount of $28,800.00 in the mail from the BP Gulf Coast Claims Facility.
Jarrell will be sentenced on Thursday, January 30, 2014, at 10:00 a.m. by U. S. District Judge Sul Ozerden, and faces a maximum sentence of 20 years in prison and a $250,000.00 fine. This case was investigated by the U.S. Postal Inspection Service and prosecuted by Assistant U.S. Attorney Andrea Jones.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
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Bellows Falls Man Sentenced for Failure to Pay Child SupportRead the Press Release
The Office of the United States Attorney for the District of Vermont stated today that Lee Godden, 36, of Bellows Falls, Vermont, was sentenced on October 2, 2013, in United States District Court in Brattleboro, Vermont, to serve two-months imprisonment and a one-year term of supervised release following his guilty plea to two counts of failure to pay child support. Senior United States District Judge J. Garvan Murtha also ordered the defendant to pay restitution to his mothers of his two children in the amount of $50,771.00 and $50,131.13, for a total of $100,902.13.
United States Attorney Coffin commended the work of the Office of Inspector General, Department of Health and Human Services in investigating the case. Mr. Godden was represented by Assistant Federal Defender David L. McColgin. The case was prosecuted by Assistant United States Attorney Barbara A. Masterson.Beaumont Orthodontist Sentenced for Health Care Fraud ViolationsRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A 70-year-old Beaumont orthodontist has been sentenced to federal prison for health care fraud violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Terrence Ewing Syler pleaded guilty on June 18, 2013, to health care fraud and was sentenced to 22 months in federal prison today by U.S. District Judge Thad Heartfield. Syler was also ordered to submit to forfeiture of $829,000 and pay a $6,000 fine.
According to the information presented in court, Syler owned and operated Syler Orthodontics in Beaumont. From January 2007 to October 2012, Syler carried out a scheme to defraud Medicaid by submitting claims for palatal expanders which were never provided to his patients. As a result of the scheme, Syler received $829,333 to which he was not entitled. As part of his plea agreement, Syler has agreed to forfeiture of several bank accounts totaling just over $829,000.
The Texas Medical Assistance Program (Medicaid) is a health care benefit program, jointly funded by the State of Texas and the federal government, and helps pay for reasonable and necessary medical procedures and services provided to individuals who are deemed eligible under state low-income programs.
This case was investigated by Federal Bureau of Investigation, the U.S. Department of Health and Human Services – Office of the Inspector General (HHS-OIG) and the Texas Office of the Attorney General – Medicaid Fraud Control Unit (OAG-MFCU). Assistant U.S. Attorney Christopher T. Tortorice prosecuted this case.
Any individuals with knowledge of these or other health care fraud violations are encouraged to contact the Department of Health and Human Services’ fraud hotline at 1-800-HHS-TIPS (447-8477).
Avon Lake Man Faces Child Pornography ChargesRead the Press Release
Craig A. Hulbert, 38, of Avon Lake, Ohio, was charged with receiving, distributing and possessing visual depictions of minors engaged in sexually explicit conduct, Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The indictment charges that from on or about May 20, 2011, through on or about March 29, 2013, Hulbert knowingly received and distributed in interstate and foreign commerce, by computer, numerous computer files, which files contained visual depictions of real minors engaged in sexually explicit conduct.
The indictment also charges that on October 15, 2013, Hulbert possessed two computers and an additional hard drive, all that contained child pornography.
If convicted, the sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan. The case was investigated by the Department of Homeland Security, Homeland Security Investigations.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Administrator of Silk Road Website and Drug Vendor Plead Guilty to Drug ConspiracyRead the Press Release
Baltimore, Maryland – An administrator of the Silk Road website, Curtis Green, a/k/a “Flush,” and “chronicpain,” age 47, of Utah, pleaded guilty today to conspiracy to distribute and possess with attempt to distribute cocaine. In a related case, Jacob Theodore George IV, age 32, of Edgewood, Maryland, pleaded guilty on November 5, 2013, to conspiracy to distribute and possess with intent to distribute drugs, including heroin.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Postal Inspector in Charge Gary R. Barksdale of the U.S. Postal Inspection Service - Washington Division; Special Agent in Charge Brian Murphy of the United States Secret Service - Baltimore Field Office; and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.
“People who believe they can commit crimes anonymously using the internet should reconsider,” said U.S. Attorney Rod J. Rosenstein.
“HSI Baltimore special agents arrested Jacob George, who was the first vendor on Silk Road selling illegal drugs to be arrested,” said ICE HSI Special Agent in Charge William Winter. “Thereafter, HSI Baltimore created and led the Baltimore Silk Road Task Force to combat the illicit activities of this digital black market website. Subsequently, Curtis Green was arrested after he was identified as an administrator and cocaine distributor on Silk Road. Last month, HSI assisted in the identification and arrest of Silk Road’s operator Ross William Ulbricht aka DPR. HSI will continue working with our domestic and international law enforcement partners to identify and arrest individuals who are conducting criminal activities by using networks and digital currency designed to provide anonymity, such as Tor and bitcoins.”
“Special Agents of the Drug Enforcement Administration are highly trained to locate narcotic traffickers and arrest them regardless of their location,” stated Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration’s Baltimore District Office. “Special Agents acting in an undercover capacity were able to locate narcotic traffickers operating in cyberspace during the course of this investigation. This sends a clear message to traffickers that even in cyberspace DEA will find you,” stated Tuggle.
According to his plea agreement, beginning in November 2012, Green worked for the creator and operator of Silk Road, Ross Ulbricht, whom Green only knew by his alias, “Dread Pirate Roberts.” Silk Road was an online, international marketplace that allowed users to anonymously buy and sell illegal drugs, false identifications, and other contraband over the Internet. Ulbricht collected a fee for each transaction on the website. Green’s responsibilities included responding to questions and complaints from buyers and sellers, resolving disputes between buyers and sellers, and investigating possible law enforcement activity on Silk Road. As part of his role as an administrator, Green had the ability to see messages Silk Road users sent to each other, to see the details of each transaction on Silk Road, and to see the accounts - including financial information - of Silk Road users, including the accounts of Ulbricht.
In September 2011, HSI Baltimore special agents initiated an investigation into the Silk Road website. Thereafter, the Baltimore Silk Road Task Force was created to address the contraband being sold on Silk Road.
Starting in April 2012, a DEA undercover agent in Maryland (the UC), began communicating with Ulbricht about selling illegal drugs on Silk Road. That agent was one of several assigned to the Baltimore Silk Road Task Force. The UC claimed to be a smuggler who specialized in moving substantial quantities of illegal drugs. In December 2012, Ulbricht set out to find a drug dealer on Silk Road who could purchase large quantities of drugs from the UC and directed his administrators, including Green, to assist. Green assisted the UC to establish contact with a buyer, who was an established seller of drugs on Silk Road (the Vendor). The UC and the Vendor negotiated a deal for one kilogram of cocaine for approximately $27,000 in Bitcoin, a digital currency that has no association with a national government, is difficult to track, and easy to move online.
Without the knowledge of either Ulbricht or the UC, Green agreed to act as a middle-man for the Vendor and take delivery of drugs. As a result, the Vendor provided Green’s address to the UC as the place to which the cocaine was to be delivered. On January 17, 2013, an undercover U.S. Postal Inspector delivered the cocaine to Green at his residence. Shortly after Green accepted delivery of the cocaine, federal agents with the HSI, DEA, U.S. Postal Inspectors and the U.S. Secret Service executed a search warrant at Green’s residence and recovered the kilogram of cocaine. U.S. Secret Service agents also conducted a forensic examination of Green’s computers and digital media seized during the search.
According to Jacob George’s plea agreement, from at least November 2011 to January 18, 2012, George sold drugs via Silk Road. George made contact with buyers via Silk Road, accepted payment electronically through Silk Road, and shipped drugs via the United States Postal Service to buyers throughout the United States and in foreign countries. The owner and operator of Silk Road, Ross William Ulbricht, collected a fee for each transaction on the website. George acquired drugs from two primary sources: he purchased some drugs, including heroin, from drug dealers in the Baltimore metropolitan area; and he purchased synthetic drugs, including methylone, from suppliers in China and had those drugs shipped to him.
Green faces a maximum sentence of 40 years in prison and George faces a maximum sentence of 20 years in prison for conspiracy to distribute and possess with intent to distribute cocaine. U.S. District Judge Catherine C. Blake scheduled sentencing for Green on February 28, 2014, at 2:00 p.m. and for George on February 20, 2014, at 9:15 a.m.
Ross Ulbricht, a/k/a “Dread Pirate Roberts,” a/k/a “DPR,” age 29, of San Francisco, California, has been indicted in Maryland on charges of conspiracy to distribute a controlled substance, attempted witness murder and using interstate commerce facilities in the commission of murder-for-hire. He faces a maximum of 40 years in prison for the drug distribution conspiracy; a maximum sentence of 30 years in prison for attempted witness murder; and a maximum of 10 years in prison for using interstate commerce facilities in the commission of murder-for-hire. No court appearance in Maryland has been scheduled.
Ulbricht faces a related indictment in the U.S. District Court for the Southern District of New York. 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 praised HSI Baltimore, DEA, U.S. Postal Inspection Service, U.S. Secret Service and IRS-Criminal Investigation for their work in the investigation. U.S. Attorney Rosenstein recognized U.S. Attorneys Preet Bharara and Gary S. Shapiro of the Southern District of New York and the Northern District of Illinois, respectively, and their offices; the FBI; and Senior Trial Counsel James Silver of the U.S. Department of Justice Computer Crimes and Intellectual Property Section for their assistance in the case. Mr. Rosenstein thanked Assistant United States Attorney Justin S. Herring, who is prosecuting this Organized Crime Drug Enforcement Task Force case.
AT&T Agrees to Settle Allegations Involving IP Relay Services <br /> Provided to Hearing- and Speech-Impaired PersonsRead the Press Release
AT&T has agreed to settle allegations that it violated the False Claims Act in connection with a program administered by the Federal Communications Commission (FCC), the Department of Justice announced today. The settlement resolves a civil lawsuit in which the government alleged that AT&T knowingly overbilled the Telecommunications Relay Services (TRS) Fund, which compensates IP Relay service providers for placing calls on behalf of hearing- or speech-impaired individuals in the U.S.“The TRS program provides vital communication assistance to hearing- and speech-impaired Americans,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “We are committed to protecting the integrity of the program, and the public funds used to support it, to ensure that hearing- and speech-impaired citizens can place emergency and other important phone calls.”
The settlement announced today involves the FCC’s IP Relay Program, which reimburses telecommunications companies that provide phone service for hearing- and speech-impaired individuals. Under this program, the companies employ communications assistants who facilitate calls to and from hearing- and speech-impaired citizens through instant messaging software. The companies are entitled to a per-minute reimbursement for each call that they handle.
The government alleged that, from December 2009 through December 2011, as much as 80 percent of the calls for which AT&T claimed reimbursement were ineligible because the calls did not originate in the U.S. or were not placed by hearing- or speech-impaired individuals. The government further alleged that it was common knowledge among AT&T communication assistants that a large percentage of their callers were from Nigeria or other foreign countries, and that they were using the TRS program to perpetrate credit card and other fraud schemes.
In 2008, the FCC issued two orders that required AT&T and other providers to register all callers and to institute procedures to verify registration information for their callers. Allegedly, AT&T initially used a postcard verification system for its IP Relay users, but the postcard system verified only a fraction of its users. Concerned about a potential drop in its IP Relay call volume, AT&T switched to a more relaxed eRegistration procedure. Upon switching to the eRegistration procedure, AT&T’s registrations increased from approximately two users per day to between 40 and 100 per day. Many of the users registered by AT&T through its eRegistration system provided AT&T with nonsensical or false names, e-mail addresses or street addresses including, for example, names composed of purely random letters such as “nbdk” or “jhgfajhs”. Despite receiving nonsensical and false registration information, AT&T enrolled the users and subsequently billed the government for their calls.
On May 7, 2013, AT&T entered into a consent decree with the FCC that resolved allegations based on conduct related to the subject matter of today’s settlement. Pursuant to that consent decree, AT&T paid a total of $18.25 million. Under the settlement announced today, AT&T has agreed to pay an additional $3.5 million to resolve its remaining liability under the False Claims Act.
“We would like to thank the Department of Justice for its assistance in ensuring the integrity of the TRS fund,” said Chief of the FCC’s Enforcement Bureau Michele Ellison. “Combined with our previous enforcement actions, today’s settlement makes it clear that we will not tolerate abuse of this system, which is vital to millions of Americans.”The government’s investigation was initiated by a qui tam, or whistleblower, lawsuit filed under the False Claims Act, which permits private citizens to bring lawsuits on behalf of the government and to share in any recovery. The lawsuit was filed in federal district court in Pittsburgh by Constance Lyttle. Lyttle will receive $525,000.
This case was handled by the U.S. Department of Justice Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Western District of Pennsylvania and the FCC Office of the Inspector General and Office of the General Counsel.
The claims resolved by this settlement are allegations only, and there has been no determination of liability. The lawsuit is captioned United States ex rel. Lyttle v. AT&T Corp., Civil Action No. 2:10-cv-01376-NBF-RCM (W.D. Pa.).
6 November 2013
Virginia Man Pleads Guilty to Weapons Offenses Stemming from July 4th Incident at Freedom Plaza-Defendant Brandished Shotgun in Video Filmed at the Site-Read the Press Release
WASHINGTON – Adam Kokesh, 31, of Herndon, Va., pled guilty today to weapons offenses stemming from an incident on July 4, 2013 in which he held a pump-action shotgun while at Freedom Plaza, U.S. Attorney Ronald C. Machen Jr. announced.
Kokesh pled guilty in the Superior Court of the District of Columbia to charges of carrying a rifle or shotgun, possession of an unregistered firearm, and unlawful possession of ammunition. In a separate case, he pled guilty to a charge of possession of marijuana. The Honorable Patricia A. Broderick scheduled sentencing for Jan. 17, 2014.
The maximum penalty for carrying a rifle or shotgun is five years in prison. The other weapons-related offenses each carry maximum sentences of a year in jail. The maximum for possession of marijuana is 180 days in jail. All of the charges also carry potential fines.
According to the government’s evidence, in the early morning hours of July 4, 2013, Kokesh stood in Freedom Plaza, in the 1400 block of Pennsylvania Avenue NW, while carrying a shotgun. While there, he loaded the shotgun with four rounds of ammunition and racked one of the rounds while being filmed on camera. Later that morning, a 23-second video of Kokesh carrying, loading and racking the shotgun was posted to YouTube and other social media sites run by Kokesh and others. In the bottom left corner of the video, the words, “Freedom Plaza, Between the White House and the Capitol, Washington, DC July 4, 2013” appear.
A search of Kokesh’s Virginia home on July 9, 2013 led to the recovery of the shotgun that was believed to have been shown in the video. During the search, Kokesh directed officers to a headboard in the master bedroom, where the shotgun was located.
“Every day, federal and local law enforcement officers put their lives on the line to protect national government facilities, national landmarks, and public servants working in our city from ongoing threats to our security,” said U.S. Attorney Machen. “Their jobs are hard enough without irresponsible people intentionally coming into the District of Columbia to brandish a loaded shotgun in the heart of the nation’s capital. As today’s plea demonstrates, there are consequences for anyone who flagrantly abuses our city’s firearms and drug laws.”
Kokesh, who had been in custody while awaiting trial, is to be released pending sentencing. The judge ordered that he stay out of the District of Columbia pending sentencing. He also is not to possess any firearms.
The drug charge stemmed from an incident on June 8, 2013 in the 1600 block of Pennsylvania Avenue NW. At 4:30 p.m. that day, officers with the U.S. Park Police observed Kokesh with what was believed to be a marijuana cigarette near the White House. Park Police recovered the cigarette, and it was later determined to contain marijuana.
In announcing the plea, U.S. Attorney Machen commended the work of those who investigated the two cases from the Metropolitan Police Department (MPD), U.S. Park Police, the FBI, the U.S. Secret Service, the Drug Enforcement Administration, and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. He also acknowledged the assistance of law enforcement agencies from Virginia. U.S. Attorney Machen also commended the efforts of those who handled the case for the U.S. Attorney’s Office, including Paralegal Specialist Wanda Trice. Finally, he thanked Assistant U.S. Attorneys Natalia Medina and Harry Roback and former Assistant U.S. Attorney Terry Eaton, who investigated and prosecuted the matters.
13-380Vending Machine Company Executive Admits Tax Fraud Conspiracy, Agrees to Pay Pepsi $1 Million in RestitutionRead the Press Release
NEWARK, N.J. — The former principal of a New Jersey vending company today admitted his role in a tax fraud scheme and agreed to pay restitution of $1 million to the Pepsi Bottling Group, the U.S. Attorney Paul J. Fishman announced.
Joseph Belasco, 62, of Cedar Grove, N.J., pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to a superseding information charging him with providing a false 2008 IRS 1099 form to the wife of a PepsiCo executive for consulting services that she never performed. Former PepsiCo executive, Edwin Glasspool, 53, of Caldwell, had previously pleaded guilty to defrauding Pepsi of $2.9 million dollars and having his wife receive his annual share of the defrauded money through checks for consulting services issued by Impact Marketing, the vending company.
According to documents filed in the case and statements made in court:In the spring of 1998, Belasco, along with a business associate, created Impact Cause Related Marketing (Impact Marketing), a subsidiary of Culinary Ventures Vending, a company that placed and stocked vending machines in private and commercial facilities, such as state colleges and entertainment venues. The purpose of Impact Marketing was allegedly to provide Pepsi Bottling Co. with leads for acquiring new customers to purchase its cans, bottles and fountain products. Impact Marketing and Belasco would receive commissions for as long as the client remained a Pepsi customer. According to its contract, Impact Marketing would also receive quarterly rebates, depending upon the amount of Pepsi product a customer purchased on an annual basis.
Glasspool, a Pepsi employee who developed new customers, assigned those customers to Impact Marketing. He also reassigned existing Pepsi customers to the list of new customers allegedly referred by Impact Marketing, generating additional commissions for leads for Belasco that Belasco had not actually generated himself. Between 1998 and 2008, Impact Marketing received from Pepsi $2.9 million in commissions and rebates as a result of the fraudulent scheme.
Glasspool and his wife, who filed joint tax returns, received as much as $200,000 in unlawful annual income from Belasco and Impact Marketing.
The charge to which Belasco pleaded guilty is punishable by a maximum potential penalty of five years in prison and a $250,000 fine. In addition to the plea of guilty, Belasco agreed to make a restitution payment of $1 million dollars to PepsiCo. Sentencing is scheduled for Feb. 25, 2014.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; and special agents of the IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, with the investigation leading to today’s guilty plea.The government is represented by V. Grady O’Malley, Senior Litigation Counsel of the U.S. Attorney=s Office Organized Crime/Gangs Unit in Newark.
13-427
Defense counsel: John A. Azzarello Esq., and David Fassett Esq., Chatham, N.J.
Belasco superseding Information
Vancouver Man Sentenced to 92 Months in Federal PrisonRead the Press Release
Police Discover Felon in Possession of Five FirearmsPORTLAND, Ore. -- Daniel Gene Hoffman, 38, of Vancouver, Washington, was sentenced today by U.S. District Court Judge Michael W. Mosman to 92 months in prison for being a felon in possession of firearms. Hoffman pled guilty to the charge in July and has been in custody since the time of his arrest on August 25, 2012.
Hoffman was operating a motor vehicle with a stolen license plate on property near the Portland Airport and patrolled by the Port of Portland Police. Police made contact with the vehicle after it parked at a nearby hotel. Hoffman was detained and after a partially concealed handgun was seen in the vehicle, it was searched and officers seized five firearms, 113 rounds of ammunition and approximately one ounce of methamphetamine. Hoffman was prohibited under federal and state law from possessing firearms by virtue of the following felony convictions: Intent to Deliver Methamphetamine While Armed with a Firearm (1997), Possession of Methamphetamine, Possession of Stolen Property and Attempting to Elude Pursuing Police Vehicle (2003), and Felon in Possession of a Firearm (2004).
This case was investigated by the Port of Portland Police and ATF and prosecuted by Assistant U. S. Attorney Fred Weinhouse.
United States Attorney's OfficeTo Distribute $2 Million to Victims of FraudRead the Press Release
Today, the United States Attorney’s Office announced the distribution of approximately $2,000,000 in criminally forfeited funds back to the victims of a Ponzi scheme relating to the investigation and ultimate prosecution of Dante DeMiro.
The following is a list of victims to whom restitution was ordered and to whom forfeited funds will be distributed on a pro rata basis:
Comstock Township
County of Lapeer
American Postal Workers Union
Boilermakers Local 85
Northern Community Credit Union
UAW Local 900
United Services Credit Union
Mona Shores Public Schools
UAW Local 1700
UAW Local 892
Lantec Bank
UAW Local 412
Boilermakers Local 107
UAW Local 723
UAW Local 600United States Attorney McQuade stated, “This case reflects the way asset forfeiture is used to disgorge the ill-gotten gains from the defendant and return the funds to victims.”
Dante DeMiro, formerly of Milford, pleaded guilty to five counts of bank and wire fraud and was sentenced to ten years in federal prison. DeMiro was an investment advisor to various municipalities, credit unions, school districts, and trade unions, through his Southfield-based companies MuniVest Financial Group and MuniVest Services LLC. DeMiro used the MuniVest entities to operate a bank and wire fraud ponzi scheme. DeMiro falsely promised investor clients that he would invest their funds in various certificates of deposit. He did not invest their funds as promised, but instead, used their funds to purchase personal items and real property, to gamble, to make payments to other investors in the same scheme, and to make loans to several individuals and a local jewelry store.
"Asset Forfeiture" refers to the process of confiscating money and property that represent either proceeds of crimes or property used in the commission of crimes. The U.S. Attorney’s Office treats asset forfeiture as a priority because forfeiture is an important deterrent to criminal conduct and facilitates restitution in criminal cases that involve victims who have suffered losses.
U.S. Consulate Official Pleads Guilty to Receiving More Than $3 Million in Bribes in Exchange for Visas-Scheme Allegedly Generated More Than $9 Million in Bribes –Read the Press Release
WASHINGTON A U.S. Foreign Service Officer, Michael T. Sestak, 42, pled guilty today to conspiracy, bribery, and money laundering charges in a scheme in which he accepted more than $3 million in bribes to process visas for non-immigrants seeking entry to the United States.
The guilty plea, which took place in the U.S. District Court for the District of Columbia, was announced by U.S. Attorney Ronald C. Machen Jr. and U.S. Department of State Diplomatic Security Service Director Gregory B. Starr.
Sestak pled guilty before the Honorable John D. Bates to one count each of conspiracy to commit bribery and visa fraud and to defraud the United States, bribery of a public official, and conspiracy to engage in monetary transactions in property derived from illegal activity. No sentencing date was set. Under federal sentencing guidelines, the applicable range for the offenses is 235 to 293 months in prison.
Under the plea agreement, Sestak has agreed to the forfeiture of the proceeds of the crimes, which includes the sale of nine properties that he purchased in Thailand with his ill-gotten gains. He also has agreed to cooperate in a continuing federal investigation.
“Today Michael Sestak admitted taking millions of dollars in bribes to issue visas to allow nearly 500 foreign nationals to enter the United States,” said U.S. Attorney Machen. “This Foreign Service Officer corrupted the integrity of a process designed to screen visitors to the United States, a process that obviously has implications for our national security. His motivation for betraying his oath of office was cold, hard cash, as he personally received more than $3 million in this visa-for-cash scam, much of which he funneled into the purchase of nine properties in Thailand. Mr. Sestak has now accepted responsibility for his conduct and is cooperating with federal law enforcement in this continuing investigation.”
“The Department of State became aware of potential visa improprieties in Vietnam and immediately referred the allegations to the Diplomatic Security Service (DS) to investigate, said Director Starr, of the Diplomatic Security Service. “DS worked collaboratively with the State Department Bureau of Consular Affairs to identify irregularities in the visa process which allowed agents and consular officials to pursue investigative leads and develop the evidence which led to Mr. Sestak’s guilty plea today. This case demonstrates how cooperation with DS partners in the region allowed the Department of Justice to pursue charges where Vietnamese citizens were victimized by individuals guided by greed.”
Sestak was arrested on May 13, 2013, and has been in custody ever since. Four others have been charged with taking part in the conspiracy. They include Binh Vo, 39, and his sister, Hong Vo, 27, both American citizens who had been living in Vietnam; Binh Vo’s wife, Anhdao Dao Nguyen, 30, a Vietnamese citizen; and Truc Tranh Huynh, 29, a Vietnamese citizen.
Hong Vo was arrested in May 2013 and Huynh was arrested the following month. Binh Vo was arrested in September 2013. Nguyen remains at large, and a warrant has been issued for her arrest. Huynh pled guilty on Oct. 16, 2013, to one count of visa fraud and is awaiting sentencing. Binh Vo and Hong Vo have pled not guilty to charges and are held without bond pending trial.
Sestak was the Non-Immigrant Visa Chief in the Consular Section of the U.S. Consulate in Ho Chi Minh City, Vietnam from August 2010 to September 2012. His responsibilities included reviewing visa applications, conducting in-person interviews of visa applicants, and issuing visas when appropriate. While employed at the State Department, Sestak held a sensitive position.
In pleading guilty, Sestak admitted that he and Binh Vo met in Ho Chi Minh City in 2010 and began a personal friendship. They ultimately came up with a plan to obtain money in exchange for facilitating the approval of non-immigrant visas from Vietnam to the United States. Sestak conspired with other U.S. citizens and Vietnamese citizens who worked to recruit customers to the visa scheme. Before they appeared at the consulate for visa interviews, Sestak would be informed of the identities of foreign nationals who agreed to pay money in exchange for obtaining visas. He then attempted to issue a visa to each foreign national who had agreed to pay for obtaining a visa, often disregarding the veracity of the information on the application.
Sestak admitted that between February 2012 and September 2012, he caused visas to be approved for people whose applications were part of the scheme. Payments made by applicants to the conspirators in exchange for visas ranged from $15,000 to $70,000. Many of the individuals who received visas had been previously denied visas for a variety of reasons.
The entire scheme generated at least $9,780,000. Of this, Sestak personally received over $3 million in proceeds of the conspiracy, which he laundered through China into Thailand. In an attempt to hide the illegal proceeds of the scheme, Sestak purchased nine real estate properties in Thailand worth over $3 million. As part of his plea agreement, Sestak agreed to sell these properties and forfeit the proceeds in order to satisfy a portion of the money judgment of at least $6 million that will be entered against him.
In announcing the guilty plea, U.S. Attorney Machen and Director Starr commended the work of those who investigated the case from the U.S. Department of State Diplomatic Security Service. They also expressed appreciation for the assistance provided by the Internal Revenue Service-Criminal Investigation and the U. S. Marshals Service. They acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Legal Assistant Ashley Kellam, and Paralegal Specialists Gail Price and Devron Elliot.
Finally, they commended the work of Assistant U.S. Attorneys Brenda J. Johnson, Christopher R. Kavanaugh, and Mona N. Sahaf of the National Security Section and Catherine K. Connelly of the Asset Forfeiture and Money Laundering Section, who are prosecuting the case.
13-379U.S. Citizen in Cuba Returns to the United States and Is Arrested for 1984 Air Piracy ChargeRead 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 defendant William Potts, Jr., a/k/a William Freeman, a/k/a Lieutenant Spartacus, was arrested by the FBI today at Miami International Airport on charges of air piracy.
Potts was indicted in the Southern District of Florida in 1985 after diverting a Piedmont Airlines passenger aircraft to Havana, Cuba as the aircraft was approaching Miami International Airport. According to court documents, Potts threatened to blow up the airplane and shoot passengers if the plane landed in Miami. The pilot diverted the aircraft and landed in Havana, Cuba. After the plane landed in Havana, Cuban authorities boarded and escorted Potts off of the plane. Potts remained in Cuba until his return to Miami on November 6, 2013. Potts is scheduled to make his initial appearance in front of U.S. Magistrate Judge Alicia M. Otazo-Reyes on Thursday, November 7, 2013, at 2:00 p.m.
If convicted, Potts faces a mandatory minimum sentence of 20 years in prison and a maximum term of life in prison.
Mr. Ferrer commended the investigative efforts of the FBI and the assistance of the Diplomatic Security Service, Coast Guard, and the Transportation Security Administration in securing Potts’s return to the United States. This case is being prosecuted by Assistant U.S. Attorney Maria K. Medetis.
An indictment is only an accusation and a defendant is presumed innocent unless and until proven guilty.
Attachment:
Indictment (PDF)
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Two Weslaco Residents Arrested for Trafficking MarijuanaRead the Press Release
LAREDO, Texas – An indictment has been partially unsealed following the arrest of Santiago Martinez, 37, and Casimiro Bautista, 38, alleging their involvement in a conspiracy to possess with the intent to distribute marijuana, announced United States Attorney Kenneth Magidson.
The indictment was returned under seal Oct. 16, 2013, and partially unsealed upon the arrests of the Weslaco residents today. It remains sealed as to those charged but not as yet in custody.
The two men are expected to make an initial appearance before U.S. Magistrate Judge Peter M. Ormsby tomorrow morning.
The indictment alleges Martinez and Bautista conspired to transport 1,000 kilograms or more of marijuana since July 2001. Specifically, the indictment alleges Martinez and Bautista acted as leaders and organizers within a drug organization in South Texas who arranged for the purchase of marijuana and transportation from the United States-Mexico border to regional distributors in Memphis, Tenn., and Tampa, Fla.
The allegations further contend that this organization packaged, wrapped and weighed marijuana prior to transportation north. The organization allegedly concealed the marijuana in semi-tractor trailers among legitimate loads of goods, in hidden compartments in “low boy” trailers and in hidden lead-lined aftermarket compartments in recreational camping vehicles. Proceeds from the sale and transportation of this marijuana were collected and sent back to South Texas, according to the indictment. The proceeds were allegedly placed in hidden compartments in tractor trailers or recreational camping vehicle or were deposited in bank accounts.
If convicted, the two face a mandatory minimum sentence of 10 years and a maximum of life in prison and a possible $10 million fine. The government is also seeking a money judgment for nearly $12 million, alleged proceeds from the criminal activity.
The case is being investigated by the Drug Enforcement Administration. Assistant United States Attorney Elizabeth R. Rabe is prosecuting the case.
A defendant is presumed innocent unless convicted through due process of law.