Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
1 November 2013
Fairbanks Brother and Sister sentenced in drug and money laundering conspiracyRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a brother and sister from Fairbanks, Alaska, were sentenced in federal court in Fairbanks for their role in a Fairbanks drug and money laundering conspirary.
Nathan Jackson, 27, and his sister, Hailey Jelinek, 20, from Fairbanks, Alaska, were sentenced today by Chief U.S. District Court Judge Ralph R. Beistline. Jackson was sentenced to 123 months in prison and three years of supervised release. He had previously pleaded guilty to both counts of an indictment charging him with drug conspiracy and money laundering conspiracy. Jelinek was sentenced to six months in prison and three years of supervised release. She had previously pleaded guilty to count two of an indictment charging her with money laundering conspiracy.
Nathan Jackson and Hailey Jelinek are brother and sister, the children of their co-defendant, Cynthia "Cindy" Hawks. Jackson and his family, as well as his girlfriend, Fabienne Clerc, were all members of a conspiracy to sell heroin in Fairbanks and to conceal the profits and proceeds of the sale of heroin.
Jackson and his mother, Hawks, sold heroin in Fairbanks. Clerc accompanied Jackson on heroin sales in Fairbanks and conducted financial transactions with drug proceeds on Jackson’s behalf in order to conceal the nature, location, source, or ownership of the drug proceeds. Hawks also conducted financial transactions with drug proceeds on Jackson’s behalf in order to conceal the nature, location, source, or ownership of the drug proceeds. Hawks also accompanied Jackson on trips to Arizona and California when he would purchase drugs to import to Fairbanks. Jelinek conducted financial transactions for Jackson to conceal the true source of the heroin proceeds.
During the investigation, law enforcement officers seized over $350,000 in cash proceeds from Jackson and his co-conspirators, as well as a 1995 Chevrolet Tahoe, a 2001 Toyota 4-Runner, two 2003 Sea-Doo Personal Watercraft, and an accompanying trailer. As part of their sentence, Jackson and Jelinek forfeited any ownership interest they may have had in these items.
Judge Beistline found that a sentencing enhancement was appropriate for Jackson since he was the leader of the conspiracy.
In September 2013, Clerc and Hawks were sentenced for their roles in the conspiracy. Clerc received a sentence of 24 months in prison and three years of supervised release and Hawks received a sentence of 32 months in prison and three years of supervised release.
Ms. Loeffler commended the Internal Revenue Service Criminal Investigation Division, the Drug Enforcement Administration, the Alaska State Troopers, and the North Pole Police Department for the investigation leading to the successful prosecutions of Jackson, Jelinek, Hawks, and Clerc.Ex-Tugboat Captain Sentenced for Transporting Child PornographyRead the Press Release
LAKE CHARLES, La. – United States Attorney Stephanie A. Finley announced today that former tugboat captain Kenneth Dwight Dickey, 57, of Foley, Ala., was sentenced by U.S. District Judge Patricia Minaldi to 108 months in prison and a lifetime of supervised release for transporting child pornography. He pleaded guilty August 1, 2013.
According to evidence presented at the guilty plea, law enforcement authorities detected Dickey downloading child pornography using “peer-to-peer” software. Those using peer-to-peer software usually take a file and place it in a “shared folder” on a computer for the purpose of distributing it to others on the internet. A search of the defendant’s computer and phone on October 15, 2012 showed that Dickey was in possession of child pornography. He also admitted to transporting child pornography from Mississippi to the Western District of Louisiana. The child pornography on the computer was sadistic in nature.Homeland Security Investigations investigated the case. Assistant U.S. Attorney John Luke Walker prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) DHS-2ICE. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp.
Endicott Man Indicted for Mailing A Letter Falsely Accusing A Department of Defense Contractor of Being A Foreign Intelligence OfficerRead the Press Release
SYRACUSE, NEW YORK –United States Attorney Richard S. Hartunian and Federal Bureau of Investigation (“FBI”) Albany Special Agent in Charge Andrew W. Vale, announced today the arrest of RYAN LETCHER, age 38, of Endicott, New York. LETCHER was indicted by a federal grand jury of one count of knowingly and willfully making a false statement in violation of 18 U.S.C. §1001(a)(3).
The indictment alleges that in March 2012, LETCHER mailed a letter to the Department of Defense (“DOD”) claiming that a DOD contractor was a foreign intelligence officer, when LETCHER knew that was not true. This charge carries a statutory maximum term of imprisonment of five years; supervised release of up to three years; a maximum fine of $250,000; and a special assessment of $100.
"The act of intentionally making false statements in order to harm others will not be tolerated. Making such fictitious, fraudulent statements can have a devastating impact on the victims and the community. The FBI will continue to work with our law enforcement partners to ensure this type malicious behavior is investigated and prosecuted," said Andrew W. Vale.
The case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Tamara Thomson.
The charge contained in the indictment is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
East St. Louis Man Pleads Guilty to “Crack” Cocaine DistributionRead the Press Release
On October 31, 2013, DeAnthony Tillman, a twenty-seven year old East St. Louis, Illinois, man pled guilty in federal district court, in East St. Louis, to distribution of cocaine base, in the form commonly known as “crack” cocaine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Tillman is scheduled for sentencing on March 7, 2014, at which time he faces a maximum sentence of 20 years in prison and a fine of up to $1,000,000, not more than 3 years of supervised release after his prison term, and a mandatory special assessment of $100.
Court proceedings revealed that on June 27, 2013, Tillman sold two grams of cocaine base in the form of “crack” cocaine to a confidential informant in East St. Louis, Illinois, at the direction and arrangement of ATF agents.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and is prosecuted by Assistant United States Attorney Daniel T. Kapsak.
East St. Louis Man Pleads Guilty to Cocaine DistributionRead the Press Release
On October 31, 2013, Michael Scott, Jr., a forty-one year old East St. Louis, Illinois, man pled guilty in federal district court, in East St. Louis, to distribution of cocaine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Scott is scheduled for sentencing on February 27, 2014, at which time he faces a maximum sentence of 20 years’ in prison and a fine of up to $1,000,000, not more than 3 years’ of supervised release after his prison term, and a mandatory special assessment of $100.
Facts presented in court revealed that on July 2, 2013, Scott sold twenty-eight grams of cocaine base to a confidential informant in Washington Park, Illinois, at the direction and arrangement of ATF agents.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and is prosecuted by Assistant United States Attorney Daniel T. Kapsak.
Dutchess County Orthopedic Surgeon Pleads GuiltyTo Multimillion Dollar Health Care Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that DR. SPYROS PANOS, an orthopedic surgeon, pled guilty today in White Plains federal court before U.S. District Judge Nelson S. Roman to operating a long-running health care fraud scheme in which PANOS defrauded Medicare, the New York State Insurance Fund, and numerous private health insurance providers (the “Health Insurance Providers”) out of over $2.5 million by systematically lying about the nature and scope of the surgical procedures that he performed.
Manhattan U.S. Attorney Preet Bharara said: “Dr. Panos was brazen in his fraud on federal, state, and private health insurance providers. He filed claims for thousands of surgical procedures, often more than 20 a day, billing a total of over $35 million, when he actually performed lesser procedures, or none at all. We and our law enforcement partners finally put a halt to his abuses.”
According to the Information and other documents filed in this case:
PANOS was a board certified orthopedic surgeon licensed to practice medicine in the State of New York who was part a medical group with offices in Dutchess County, New York, (the “Medical Group”) and performed orthopedic surgical procedures (“Surgical Procedures”) at hospitals in Poughkeepsie, New York. From at least 2006 through July 2011, PANOS maintained a high-volume orthopedic practice, which enabled him to carry out his fraud scheme on a large scale. Panos performed thousands of Surgical Procedures, and often as many as 20 or more in a single day, for which he and the Medical Group submitted claims in excess of $35 million to Health Care Providers. Health Care Providers paid the Medical Group in excess of $13 million on these claims.
To receive payments for Surgical Procedures from the Health Insurance Providers, PANOS was required to submit, and caused the Medical Group to submit, information to the Health Insurance Providers regarding the nature and details of the Surgical Procedures. With respect to many of the Surgical Procedures he performed, PANOS furnished, and caused the Medical Group to furnish, false information to Health Insurance Providers that resulted in the Health Insurance Providers paying the Medical Group at least $2.5 million more than PANOS and the Medical Group were entitled to receive based on the true nature and details of the Surgical Procedures PANOS performed. Among PANOS’s false representations were the following:
a. PANOS claimed he performed open surgeries, when in fact PANOS performed the surgeries arthroscopically;
b. PANOS claimed he used certain techniques and procedures during the course of the Surgical Procedures, when in fact PANOS did not, either because they were not medically necessary or because PANOS used other techniques and procedures that would have resulted in lower payments, if any, from the Health Insurance Providers; and
c. PANOS removed body tissue, known in the medical field as loose bodies, in excess of certain size criteria, when in fact PANOS either removed no loose bodies or removed loose bodies that were smaller than the thresholds set by the Health Insurance Providers for payment.
PANOS, was compensated handsomely -- during the years 2007 through 2011, he was paid over $7.5 million by the Medical Group, a number that was inflated as a result of his fraud scheme.
Beginning in or about December 2010, PANOS attempted to conceal his scheme by, among other things, falsely representing to the Medical Group that the Fraudulent Claims were the result of clerical errors.
PANOS, 45, of Hopewell Junction, New York, faces a maximum sentence of 10 years in prison. PANOS agreed to the entry of a $5 million order of forfeiture against him, representing the approximate proceeds of his charged crime. As a result of his conviction, PANOS is subject to mandatory exclusion from participation in any Federal health care program, including Medicare and Medicaid, and he has agreed not to oppose a request by the Government that, as part of his sentence, the Court prohibit him from practicing medicine as a condition of probation or supervised release. Following the uncovering of the scheme, Panos surrendered his New York State medical license. As part of his plea agreement, PANOS must take any reasonable steps necessary to ensure that his Connecticut, Pennsylvania, and Virginia medical licenses are revoked, surrendered, or suspended by the time of sentencing. PANOS is scheduled to be sentenced by U.S. District Court Judge Roman on March 7, 2014.
Mr. Bharara praised the work of the United States Postal Inspection Service, the United States Department of Health and Human Services – Office of Inspector General, and the Federal Bureau of Investigation, and thanked the United States Department of Health and Human Services, Office of Counsel to the Inspector General, the New York State Insurance Fund, and the New York Workers’ Compensation Board Office of the Fraud Inspector General for their extraordinary assistance in the investigation.
This case is being handled by the White Plains Division. Assistant United States Attorneys Lee Renzin and Daniel Filor are in charge of the prosecution.
Panos, Spyros Information
District Man Sentenced to Six Years in Prison for Sexually Assaulting Woman at Her Apartment-Victim Was Unconscious at Time of Assault-Read the Press Release
WASHINGTON – Antawon Randall, 28, of Capitol Heights, Md., was sentenced today to six years in prison on charges stemming from a sexual assault against a woman who was unconscious in her own home, U.S. Attorney Ronald C. Machen Jr. announced.
Randall pled guilty in July 2013, in the Superior Court of the District of Columbia to charges of second-degree sexual abuse and fourth-degree sexual abuse. He was sentenced by the Honorable Ronna L. Beck. Upon completion of his prison term, Randall will be placed on five years of supervised release. He must also register as a sex offender for the rest of his life.
According to the government’s evidence, on Sept. 8, 2012, the victim and her husband hosted a gathering at their apartment in Southeast Washington. At some point during the gathering, the victim became sick from consuming too much alcohol and passed out.
When the victim’s husband went to work, Randall snuck into her bedroom and sexually assaulted her while she was unconscious.
In announcing the sentence, U.S. Attorney Machen commended the work performed by those who investigated the case from the Metropolitan Police Department’s Sexual Assault Unit. He also praised those who handled the case for the U.S. Attorney’s Office, including Paralegal Specialist D’Yvonne Key, Victim/Witness Advocate Tracey Hawkins, and Assistant U.S. Attorney Mervin A. Bourne, Jr., who investigated and prosecuted the matter.
13-376District Man Sentenced to 25 Years in Prison in 2011 Slaying in Southeast Washington -Victim’s Father Pled Guilty to Tampering with Evidence at the Scene-Read the Press Release
WASHINGTON – William Faison, 23, of Washington, D.C., was sentenced today to 25 years of incarceration for the slaying of 19-year-old Jeffrey Covington during an attempted robbery in Southeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Faison pled guilty in June 2013, in the Superior Court of the District of Columbia, to second-degree murder while armed. He was sentenced by the Honorable Ronna Lee Beck. Upon completion of his prison term, Faison will be placed on five years of supervised release.
In a related development, the victim’s father, Jeffrey Blount, 43, also of Washington, D.C., pled guilty in June 2013 to a charge of tampering with physical evidence at the scene of the murder. Blount later was sentenced to five months of incarceration, but the time was suspended on the condition that he successfully completes a year of probation.
According to the government’s evidence, on July 2, 2011, Jeffrey Blount and his son were involved in a craps game in the 600 block of 46th Place SE. Shortly after 1 a.m., Faison, who was nearby, approached Blount while pulling a .38-caliber revolver from his waistband.
Faison pushed Mr. Covington aside to get to Blount and pointed the gun at Blount’s back in an attempt to rob him. Nearly everyone involved in the craps game, including Blount, fled. Faison chased after Blount, with his gun still drawn. Mr. Covington attempted to come to the aid of his father by pointing an inoperable weapon at Faison. Faison then turned back toward the victim and fired one shot at him, fatally striking him in the upper chest/throat.
Faison then fled into an apartment in a building on the block. Police sought and obtained a search warrant for that apartment on July 2, 2011, and they recovered a .38-caliber revolver with a spent shell casing inside. Faison was still in the apartment at the time of the recovery.
Following the murder, Blount returned to the scene, approached his son’s body, and attempted to remove currency from Mr. Covington’s pockets. He then checked his son’s pulse before moving the inoperable pistol from Mr. Covington’s side to a nearby trash can.
In announcing the sentence, U.S. Attorney Machen praised the work of the detectives, officers, and crime scene technicians who investigated the case for the Metropolitan Police Department. He also commended the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Phaylyn Hunt, Fern Rhedrick, and Kendra Johnson and Victim/Witness Advocate Marcia Rinker. Finally, U.S. Attorney Machen recognized Assistant U.S. Attorneys Melinda A. Williams, Jeffrey Pearlman, and Erik Kenerson, who investigated and prosecuted the case.
13-374Co-Founder of Liberty Reserve Pleads Guilty to Money Laundering in Manhattan Federal CourtRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Mythili Raman, Acting Assistant Attorney General for the Justice Department’s Criminal Division, announced that VLADIMIR KATS pled guilty today in Manhattan federal court to money laundering and operating an unlicensed money transmitting business for his role in running LIBERTY RESERVE, a company that operated one of the world’s most widely used digital currency services and allegedly laundered more than $6 billion in suspected proceeds of crimes. KATS was arrested in Brooklyn, New York, in May 2013. KATS pled guilty today before U.S. District Judge Denise L. Cote.
Manhattan U.S. Attorney Preet Bharara said: “As a co-founder and operator of Liberty Reserve, Vladimir Kats served as a global banker for criminals, giving them an anonymous, online forum to hide the proceeds of their illegal and dangerous activities. With his guilty plea today, we take a significant step toward punishing those responsible for creating and running this international den of cybercrime.”
Acting Assistant Attorney General Mythili Raman said: “Vladimir Kats, by his own admission, helped to create and operate an anonymous digital currency system that provided cybercriminals and others with the means to launder criminal proceeds on an unprecedented scale. His conviction reinforces what we said when Liberty Reserve was first brought down: banking systems that allow criminals to conduct illegal transactions anonymously will not be allowed to stand, and professional money launderers will be brought to justice.”
According to allegations contained in the Indictment filed against LIBERTY RESERVE, KATS, and six other individual defendants, the Superseding Information against KATS, and statements made in related court proceedings:
LIBERTY RESERVE was incorporated in Costa Rica in 2006 and billed itself as the Internet’s “largest payment processor and money transfer system.” LIBERTY RESERVE was created, structured and operated to help users conduct illegal transactions anonymously and launder the proceeds of their crimes, and it emerged as one of the principal money transfer agents used by cybercriminals around the world to distribute, store, and launder the proceeds of their illegal activity. LIBERTY RESERVE was used extensively for illegal purposes, functioning as the bank of choice for the criminal underworld because it provided an infrastructure that enabled cybercriminals around the world to conduct anonymous and untraceable financial transactions.
Before being shut down by the Government in May 2013, LIBERTY RESERVE had more than one million users worldwide, including more than 200,000 users in the United States, who conducted approximately 55 million transactions through its system and laundered more than $6 billion in suspected proceeds of crimes, including credit card fraud, identity theft, investment fraud, computer hacking, child pornography, and narcotics trafficking. KATS co-founded LIBERTY RESERVE and helped operate the company until in or about 2009.
KATS, 41, of Brooklyn, New York, pled guilty to one count of conspiring to commit money laundering, which carries a maximum sentence of 20 years in prison; one count of conspiring to operate an unlicensed money transmitting business, which carries a maximum sentence of five years in prison; one count of operating an unlicensed money transmitting business, which carries a maximum sentence of five years in prison; one count of receiving child pornography, which carries a maximum sentence of 40 years in prison and a mandatory minimum sentence of fifteen years in prison; and one count of marriage fraud, which carries a maximum sentence of five years in prison. A sentencing date has not yet been scheduled.
Mr. Bharara praised the outstanding work of the Secret Service, the Internal Revenue Service-Criminal Investigation, and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, which worked together in this case as part of the Global Illicit Financial Team. Mr. Bharara also thanked the Secret Service’s New York Electronic Crimes Task Force for their extraordinary assistance with the investigation. Additionally, Mr. Bharara specially thanked all the international law enforcement agencies that assisted in the investigation, in particular, the Judicial Investigation Organization in Costa Rica, the National High Tech Crime Unit in the Netherlands, the Spanish National Police, Financial and Economic Crime Unit, the Cyber Crime Unit at the Swedish National Bureau of Investigation, and the Swiss Federal Prosecutor’s Office.
This case is being prosecuted jointly with the Department of Justice’s Asset Forfeiture and Money Laundering Section (“AFMLS”), which is overseen by Acting Assistant Attorney General Mythili Raman. Mr. Bharara thanked AFMLS for its partnership and also thanked the Department of Justice’s Office of International Affairs and Computer Crime and Intellectual Property Section for their support.
The prosecution of this case is being handled by the Office’s Complex Frauds Unit and Asset Forfeiture Unit. Assistant United States Attorneys Serrin Turner and Andrew Goldstein of the Southern District of New York and Trial Attorney Kevin Mosley of AFMLS are in charge of the prosecution, and Assistant United States Attorney Christine Magdo is in charge of the forfeiture aspects of the case.
The charges contained in the Indictment against KATS’s co-defendants remain pending and are merely accusations. Those defendants are presumed innocent unless and until proven guilty.
Kats, Vladimir S6 Information
California Man Sentenced to 96 Months for Committing Bank Fraud and Aggravated Identity Theft in VirginiaRead the Press Release
ALEXANDRIA, Va. – Taurice L. Jourdan, 35, of Oakland, Ca., was sentenced today to 96 months in prison, followed by 5 years of supervised release for bank fraud and aggravated identity theft. Jourdan was also ordered to pay restitution and forfeit criminal proceeds in the amount of $260,535.62.
Dana J. Boente, Acting United States Attorney for the Eastern District of Virginia, and Gary Barksdale, Inspector in Charge of the Washington Division of the United States Postal Inspection Service, made the announcement after sentencing by United States District Judge Anthony J. Trenga.
Jourdan pleaded guilty on August 12, 2013. According to court documents, from August 2011 through April 2013, Jourdan obtained the credit reports of real people and used his victims’ identities to open fraudulent bank accounts. As part of the scheme, Jourdan then deposited counterfeit checks into the bank accounts and withdrew the money. In total, Jourdan attempted to steal more than $500,000 from federally-insured banks. In addition to causing financial harm to the banks, Jourdan also impacted the lives of more than ten identity-theft victims.
This case was investigated by the United States Postal Inspection Service. Assistant United States Attorney Kosta S. Stojilkovic prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Bloomfield Hills Man Sentenced for Tax OffensesRead the Press Release
A Bloomfield Hills resident was sentenced yesterday to 27 months imprisonment for impeding the administration of the IRS laws and presenting false documents to the IRS, announced United States Attorney Barbara L. McQuade.
McQuade was joined in the announcement by Carolyn Weber, Acting Special Agent in Charge of the Internal Revenue Service, Criminal Investigation.
Ernest Adam Csolkovits, 57, of Bloomfield Hills, Michigan, was sentenced by United States District Judge Julian Able Cook.
According to court records Csolkovits’ operated a multi-level marketing company called W.H.I.C. USA, Inc. based in Northville, Michigan. Csolkovits solicited monies from individuals, typically retired and elderly, for what he called commissaries to sell products that his company, W.H.I.C. USA would produce. One such product was an all-natural rodenticide called E.R.A.S.E. which Csolkovits promised to have approved by the EPA and then market and produce. Csolkovits obtained more than $2 million from individuals during the period of June 2000 through the end of 2003. Csolkovits, however, spent much of the money for personal expenditures, but filed no corporate or individual tax returns. Eventually, when he and his company were audited by the IRS, he falsely informed the IRS that the substantial cash he had taken out of his corporate account was to pay royalties to a parent company in the Bahamas, called W.H.I.C. International. He also provided the IRS with a purported Exclusive License Agreement between his company and the Bahamian company and a substantial number of receipts purportedly evidencing the cash royalty payments made pursuant to the Exclusive License Agreement. The evidence revealed, however, that the Bahamian company was merely a shell company that Csolkovits had formed himself and the license agreement and receipts were phony.
“Not only did Mr. Csolkovits lie to the IRS, he lied to his investors in this elaborate multi-level marketing scheme,” stated Carolyn Weber, Acting Special Agent in Charge. “He had no intention of using the money as he promised his investors he would. Instead Mr. Csolkovits used the funds for his own personal benefit. The IRS will continue to pursue those who circumvent the United States tax system and seek justice for the victims of those who unscrupulously take advantage of others.”
The investigation of this case was conducted by special agents of the FBI and IRS Criminal Investigations and prosecuted by Assistant U.S. Attorney Ross MacKenzie.
Biloxi Man Sentenced for Oil Spill FraudRead the Press Release
Gulfport, Miss. – Thanh Van Nguyen, 46, of Biloxi, was sentenced by U. S. District Judge Sul Ozerden to 16 months in federal prison followed by three years of supervised release for mail fraud in connection with the Deepwater Horizon Oil Spill, U.S. Attorney Gregory K. Davis announced today. Nguyen was also ordered to pay restitution in the amount of $171,577.92 and perform 100 hours of community service.
Nguyen admitted that he carried out a scheme to defraud the BP Gulf Coast Claims Facility by making a false claim for damages, alleging that he lost earnings and profits from his Ocean Springs business, TN Dollar Partnership, as a result of the Deepwater Horizon Oil Spill when, in fact, the business was closed and not operational at the time of the oil spill.
This case was investigated by the United States Secret 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:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Our nation-wide commitment to reducing gun crime in America.
Bergen County, N.J. Man Sentenced to 33 Months in Prison for His Role in $3.5 Million Foreign Currency Investment Ponzi SchemeRead the Press Release
CAMDEN, N.J. – A Bergen County, N.J., man claiming to run New Jersey-based hedge funds using a secret computer program to invest in foreign currency was sentenced today to 33 months in prison for his role in defrauding victims out of more than $3.5 million, U.S. Attorney Paul J. Fishman announced.
Carmelo Provenzano, 31, of Garfield, N.J., and co-conspirator Daniel Dragan, 43, of Lebanon, N.J., previously pleaded guilty to separate informations charging them with wire fraud conspiracy before U.S. District Judge Jerome B. Simandle in Camden federal court. A third co-conspirator, George Sepero, 40, of Glen Rock, N.J., previously pleaded guilty to a superseding information charging him with wire fraud conspiracy, wire fraud and tax evasion before Judge Simandle.
Dragan will be sentenced in December 2013. Sepero was sentenced to 100 months in prison on Oct 18, 2013.
According to documents filed in this and other cases and statements made in court:
Beginning in 2009, Dragan, Provenzano and Sepero claimed to run a series of hedge funds in New Jersey, luring investors with the prospect of extraordinary profits in foreign currency trading. The defendants made numerous misrepresentations and omissions to induce their victims to invest in Caxton Capital Management and CCP Pro Consulting Inc. Dragan, Provenzano and Sepero claimed they controlled a proprietary computer algorithm for trading foreign currencies; that they had used the algorithm to achieve returns of more than 170 percent in the prior two years; and that any investment funds would be highly liquid and could be withdrawn on a few days’ notice.
Relying on these and other misrepresentations, investors sent the defendants more than $3.5 million. Dragan, Provenzano and Sepero invested little or no money in foreign currency or any other investment vehicle, instead diverting the vast majority of victims’ investments to pay prior victims in Ponzi-scheme style and to finance extravagant personal expenditures.
Dragan, Provenzano and Sepero spent investor money on credit card bills averaging $25,000 per month; bar tabs of $18,241 - including a $4,000 tip - and $14,034 on separate nights at “Drai’s Hollywood” nightclub in Los Angeles; and flights to Paris and elsewhere. Provenzano bought a luxury Range Rover Sport SUV costing more than $71,000, with a down payment of more than $65,000.
The defendants furthered the scheme by emailing victims fake statements showing their principal had been invested in the foreign currency markets and was achieving substantial results. Many of these e-mails were purportedly sent by an individual named “Mel Tannenbaum,” a fictional character of Provenzano’s invention.The defendants also e-mailed to several investors screen shots of a computer-based trading program, which they claimed represented the investors’ funds being traded in the currency markets. In reality, the shots reflected trading in fictional accounts set up by the conspirators to dupe investors.
In addition to the prison term, Judge Simandle sentenced Provenzano to serve three years of supervised release and ordered him to pay restitution of $4,508,949.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, for the investigation leading to today’s sentence. He also thanked the Commodity Futures Trading Commission’s New York Regional Office, under the direction of David Meister.
The government is represented by Assistant U.S. Attorneys Christopher Kelly and Zach Intrater of the U.S. Attorney’s Office Economic Crimes Unit and Evan Weitz of the Office’s Asset Forfeiture Unit in Newark.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
13-425
Defense counsel: Dragan: David Fassett Esq., Chatham, N.J.
Provenzano: Raymond Flood Esq., Hackensack, N.J.
Sepero: John Weischel Esq., Hackensack, N.J.Barnett Pleads Guilty to Introducing Pollutant into A Sewer System Knowing It Would Damage PropertyRead the Press Release
SALT LAKE CITY - Slade E. Barnett, Jr., age 48, of Camano Island, Washington, pleaded guilty in federal court Friday morning to introducing a pollutant into a sewer system that he knew would cause property damage. He faces up to three years in prison for the conviction. U.S. District Judge Tena Campbell set sentencing in the case for January 16, 2014.
Barnett was charged with knowingly introducing a pollutant into a sewer system that he knew or should have known would cause property damage and making a false statement in a document in an indictment returned by a federal grand jury on July 11, 2012. At times relevant to the charges, Barnett was the principal agent for Denali Industries, LLC, in American Fork, Utah.
Denali Industries, LLC, was located within the Lakeside Planned Industrial Park in American Fork. The building in which Denali did business had a trench drain that ran the length of the indoor shop. This trench, according to court documents, connected to a grease trap, which discharged into a gravity-fed sewer line that Lakeside owned. Through a series of pumps and lift stations, Lakeside’s pressurized sewer line connected into the gravity-fed sewer line that formed part of American Fork’s municipal sewer system. This sewer line of American Fork connected into the publicly owned treatment works of the Timpanogos Special Services District, according to the plea agreement.
Barnett admitted that on three dates in March and June of 2008, he was the responsible corporate officer at Denali. He stipulated that he had knowledge that others working at Denali introduced pollutants such as waste vegetable oil and tallow, among other things, into the sewer system. He agreed that he reasonably should have known that these pollutants could cause damage to the sewer system’s pipes and lift-station pumps. Although he had the authority to stop these acts, he admitted he failed to do so. He acknowledged that the introduction of the pollutants into the sewer system knocked out the lift station pumps, which required their replacement on March 24, 2008, and June 4, 2008. On about June 25, 2008, these pollutants clogged approximately 300 feet of sewer system pipe, which required the evacuation and replacement of parts of the sewer system.
As a part of the plea agreement, the United States and Barnett agreed that he should pay $15,000 in restitution for the damage his crimes caused to the sewer system.
David B. Barlow, United States Attorney in Utah, said, “This is not a case about somebody putting a little bacon grease down the sink at their home. This case is about a business introducing enough waste vegetable oil and tallow into the sewer system to cause parts of it to fail on at least three occasions within a three-month period. When businesses jeopardize the sewer systems we all depend upon to keep us safe from disease, the Clean Water Act demands that we hold the leaders of these businesses personally accountable.”
“Today’s plea sends a clear message to other potential violators that companies and their senior executives that fail to dispose of their wastes legally and in an environmentally sound manner will be held responsible for their crimes," said Jeffrey Martinez, Special Agent in Charge of EPA’s criminal enforcement program in Utah.
Athaliah Venus Allison Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on November 1, 2013, before U.S. District Sam E. Haddon, ATHALIAH VENUS ALLISON, a 36-year-old resident of Belgrade, was sentenced to a term of:
- ison: 56 months
- ecial Assessment: $300
- stitution: $388,755.33
- pervised Release: 3 years
ALLISON was sentenced in connection with her guilty plea to (2) counts of wire fraud and (1) count of aggravated identity theft.
In an Offer of Proof filed by Assistant U.S. Attorney Timothy J. Racicot, the government stated it would have proved at trial the following:
ALLISON was the bookkeeper for Big Sky Asphalt in Bozeman from the summer of 2008 through the summer of 2012. Her work was predominantly seasonal and there were periods of time when she was employed essentially 40 hours per week and other periods where she was employed fewer than 40 hours per week, if at all.
In approximately July 2008, ALLISON began embezzling from the company by writing and signing unauthorized company checks to herself and to other entities and making unauthorized credit card purchases using the US Bank company credit card. The loss to Big Sky Asphalt is approximately $318,166.04 ($68,503.81 in check fraud and $249,662.23 in credit card fraud).
The owners of Big Sky Asphalt found out about the embezzlement when ALLISON confessed around Labor Day 2012 that she had used the company credit card to pay for her husband's substance abuse treatment in Billings. ALLISON was very upset and agreed to pay back the $6,700 charge. Later that same week, ALLISON called the wife of one of the owners of Big Sky Asphalt and told her that the credit card was due and the balance was $3,426. The owner's wife called US Bank directly to pay over the phone and was informed that the balance was $10,777, so she went to ALLISON's house to get the statement and noticed that it said $3,426. Based on the discrepancy, the owner's wife ordered transaction histories for the US Bank account dating back to December 2008.
The owner's wife audited the credit card statements and discovered $249,662.23 in unauthorized purchases, including $39,544.11 to Blanchford Landscaping. Additional investigation revealed that ALLISON approached the owner of Blanchford Landscaping, for whom she also worked as bookkeeper, in approximately July 2011 and offered to pay the company's bills with a low-interest, high-limit credit account, which turned out to be Big Sky Asphalt's US Bank credit card.
ALLISON also wrote checks to herself on Big Sky Asphalt's bank account totaling $193,303.81. Even a generous estimate of her actual wages reveals an overpayment of $68,503.81, yielding an approximate total loss amount of $318,166.04 for both the credit card and check fraud. The checks that ALLISON wrote to herself were often for "reimbursable expenses." The checks also required the signatures of both of the owners of Big Sky Asphalt (J.S. and D.S.), which ALLISON forged. The forgery on October 22, 2008, in connection with ALLISON's negotiation of check number 27462, forms the basis of the identity theft charge in Count III of the Information.
ALLISON changed the address for the US Bank statements without permission, rerouting them to her personal residence. She also had the various accounts combined into one monthly summary. Once she controlled the statements she altered them by digitally removing the unauthorized charges and adding those amounts onto authorized expenditures for purchases made by Big Sky Asphalt's owners. She then removed her personal address from the bill, replaced it with the company address, and made the statements available to the owners for their review.
ALLISON used Big Sky Asphalt's credit card to pay Blanchford Landscaping's bills and then reimbursed herself from Blanchford's checking account. It appears that she charged $39,544.11 in Blanchford bills to the Big Sky Asphalt card.
ALLISON also opened a Staples Citibank account in 2008 in Big Sky Asphalt's name and charged $1,311.90 in expenses to places such as Macy's, Nordstrom, Aeropostale, American Eagle, Babies 'R Us, and Kohls.
From May 2009 through April 2012, during the same time period that she was embezzling from Big Sky Asphalt, ALLISON was also receiving unemployment benefits from the State of Montana. In June 2009, ALLISON reported to the State that she worked four hours and made $66. That same month, Big Sky Asphalt paid ALLISON $1,072 in wages for 80 hours of work. In August 2009, she reported 12 hours and $180 to the State, but made $2,278 working 181 hours (including overtime) for Big Sky Asphalt.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that ALLISON will likely serve all of the time imposed by the court. In the federal system, ALLISON does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was a cooperative effort between the Federal Bureau of Investigation and the Bozeman Police Department.
APCO Liquidating Trust to Pay United States $14 Million in Cost Recoveries to Settle Longstanding Bankruptcy LitigationRead the Press Release
The U.S. Bankruptcy Court for the District of Delaware approved a settlement agreement today between the United States and the APCO Liquidating Trust (a successor in interest to APCO Oil Corporation). The settlement follows seven years of litigation concerning the APCO Liquidating Trust’s liability under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA or “Superfund”) for costs incurred by the U.S. Environmental Protection Agency (EPA) for the ongoing cleanup of the Oklahoma Refining Company (ORC) Superfund Site located in Cyril, Okla.
In February 2006, EPA filed a proof of claim in the Trust’s bankruptcy proceeding seeking the recovery of past and estimated future cleanup costs incurred in connection with the site.
Under the settlement agreement, the APCO Liquidating Trust and the APCO Missing Stockholder Trust have agreed to pay $14 million to the United States in order to resolve the U.S. action and related litigation.
“We are very pleased that as a result of vigorous enforcement in the bankruptcy court, the United States was able to achieve a substantial recovery,” said Robert G. Dreher, Acting Assistant Attorney General for the Environment and Natural Resources Division. “The settlement payments will be used to fund expected future cleanup at the ORC Superfund Site. This is good news for U.S. taxpayers and the environment.”
The ORC Site was operated by Anderson-Prichard Oil Corporation and APCO Oil Corporation as an oil refinery from 1920 until about 1978, and then in a limited capacity by Oklahoma Refining Company until 1987. In 1990, EPA placed the site on the National Priorities List. EPA’s previous response actions addressed contamination of surface water, soil, and sediments on the southern portion of the site and the demolition and removal of refinery structures, tanks, and chemicals from the northern portion of the site.
On June 17, 2013, EPA Region 6 and the Oklahoma Department of Environmental Quality issued a record of decision for Operable Unit 2. This decision selected the remedy for the remaining contaminated soil, sediment, and light non-aqueous phase liquid on the north side of the site. Work is expected to begin on this remedy in 2014. When the necessary studies are completed, EPA and ODEQ will select a remedy for site ground water in a third and final record of decision.
20-year Sentence for Xenia Man Who Distributed Child PornRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
DAYTON – Brian Rohrback, 29, of Xenia, Ohio was sentenced to 240 months in prison and will be under court supervision for the rest of his life for coercing teenage boys and for sharing pornographic images and videos through a file-sharing site on the internet.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation, and Xenia Police Chief Donald R. Person announced the sentence imposed October 31 by U.S. District Judge Timothy S. Black.
“Rohrback’s conduct involved the coercion and enticement of young men to participate in illegal sexual activities,” Assistant U.S. Attorney Christy Muncy wrote in a document filed with the court before the sentencing. “In addition, Rohrback was found to be distributing child pornography through the use of his computer. The combined total of images and/or videos of child pornography found to be in Rohrback’s possession was 4,005.”
Undercover FBI agents patrolling the internet for those possessing and sharing child pornography identified Rohrback as a user of a particular file-sharing program. Further investigation led to Rohrback’s arrest on October 24, 2012 and subsequent indictment. Rohrback pleaded guilty on February 14, 2013 to one count of coercion and enticement and one count of distribution of child pornography.
This case was brought as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorneys Offices, 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/.
U.S. Attorney Stewart commended the investigation by FBI agents in Ohio, Florida and Texas, the Xenia Police Department, and Assistant U.S. Attorney Christy Muncy, who prosecuted the case.
10 Defendants Plead Guilty to Charges in Central Louisiana Cocaine Distribution ConspiracyRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that 10 defendants pleaded guilty Thursday before U.S. District Judge Dee D. Drell, for their roles in a cocaine distribution network operating across the central Louisiana area.The defendants who pleaded guilty to drug conspiracy charges are: Michael J. Wright, 27, of Houston; Dennis Wayne Bradford, 30, of Cottonport, La.; Falon S. Maricle, 31, Brandon C. Thomas, 30, of Marksville, La.; Abraham Baylor III, 38, Earnest G. Miles III, 25, Leotis V. Perry, 36, Sedrick D. Porter, 35, Terrace D. Winchester, 34, and Dontour D. Drakes, 37, of Alexandria, La. Drakes also pleaded guilty to one count of possession of a firearm in furtherance of a drug trafficking crime.
According to evidence presented at the guilty plea, from January 2012 through March 2013, authorities in Avoyelles and Rapides parishes conducted an investigation into cocaine trafficking that resulted in the arrest of these 10 defendants. It was determined that this group was responsible for the sale and distribution of more than 10 kilos of cocaine. Law enforcement agents seized more than 5 kilograms of powder cocaine, 500 grams of crack cocaine, and approximately $70,000 in cash. The defendants obtained their cocaine from Houston and converted it into crack in the CENLA area to sell in Avoyelles and Rapides parishes.
The defendants each face up to 20 years in prison, three years of supervised release, and a $1 million fine for the drug conspiracy count. Drakes will also serve an additional five years in prison for possessing of a firearm in furtherance of a drug trafficking crime. Sentencing dates are set for January 30 and 31, 2014.
“The guilty pleas are the result of a collaborative effort by federal, state and local law enforcement,” Finley stated. “Our goal is to work with all of the law enforcement tools and expertise at our disposal to keep our communities and neighborhoods safe.”
The FBI Central Louisiana Safe Streets Task Force, the U.S. Marshals Service Task Force, the Louisiana State Police, Rapides Parish Sheriff’s Office, Avoyelles Parish Sheriff’s Office, Alexandria Police Department and the Louisiana Probation and Parole Office conducted the investigation. Assistant U.S. Attorneys James G. Cowles and Seth Reeg are prosecuting the case.
31 October 2013
Wyoming Men Plead Guilty to Involuntary Manslaughter and Aiding and AbettingRead the Press Release
U.S. Attorney for the District of Wyoming Christopher A. Crofts announced today that on October 29, 2013, Alan Brown, 61, and his brother Vernon Lee Brown, 54, both Northern Arapaho Tribal Members, pled guilty in federal court to an Information charging them with one count of Involuntary Manslaughter and Aiding and Abetting (Alan Brown) and Involuntary Manslaughter (Vernon Brown), in violation of 18 U.S.C. §§ 1112, 1153 and 2. The charges against Alan and Vernon Lee Brown stem from an incident that occurred on or about May 6, 2006, which resulted in the death of Tad Paul Barnson, 47, who was originally from Idaho Falls, Idaho, but resided in and around Riverton, Wyoming at the time of his death. Alan and Vernon Lee Brown are Wind River Indian Reservation inhabitants, but are not believed to have any permanent residence. This crime is alleged to have occurred on the Wind River Indian Reservation. Alan and Vernon Lee Brown are each facing a maximum sentence of eight (8) years imprisonment, and could be ordered to pay restitution, a fine and special assessment. This case was investigated by the Federal Bureau of Investigation.
Winchester Man Convicted of Distributing Heroin Resulting in DeathRead the Press Release
Defendant will receive a minimum of 20 years in prison
LEXINGTON, KY - A federal jury convicted a Winchester, KY., man today of distributing heroin that resulted in an overdose death.
The jury convicted 53 year-old Harold Wayne Salyers on Wednesday evening for distribution of heroin resulting in death, conspiracy to distribute heroin, possession with intent to distribute heroin and distribution of heroin. The jury returned the verdict after approximately three hours of deliberation following two days of trial.
According to testimony, in August of 2012, Salyers distributed heroin to an individual in Clark County who used the heroin, overdosed and died. Evidence at trial established that three individuals witnessed the victim ingest the heroin and that the day after the victim died, Salyers admitted to one of the witnesses, in a recorded conversation, that he distributed the heroin to the victim.
Experts from the Medical Examiner’s Office and the toxicologist testified that the victim’s death was caused by the toxic effects of heroin in the victim’s body.
Evidence further established that Salyers conspired with others to distribute heroin in Clark County from approximately August 2012 until June 2013.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky; Robert L. Corso, Special Agent in Charge, Drug Enforcement Administration; and Kevin Palmer, Chief, Winchester Police Department, jointly made the announcement today.
The investigation was conducted by the DEA and the Winchester Police Department. The U.S. attorney’s office is represented by Assistant U.S. Attorney Todd Bradbury.
Salyers’ sentence is scheduled for January. The distribution of heroin resulting in death offense carries a minimum of 20 years in prison and maximum of life. He faces a maximum of 20 years on the other heroin charges. However, any sentence following a conviction would be imposed after the Court considers the U.S. Sentencing Guidelines and the federal statutes.
Wethersfield Woman Who Assisted in Fraud Scheme Sentenced to 30 Months in Federal PrisonRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, today announced that SUNITA D. BUDDHU, 43, of Wethersfield, was sentenced yesterday by U.S. District Judge Alvin W. Thompson in Hartford to 30 months of imprisonment, followed by five years of supervised release, for helping her father, Deowraj “Deo” Buddhu , operate a fraudulent debt elimination scheme that victimized more than 125 people in Connecticut, New York, Wisconsin, Florida and Georgia.
According to court documents and statements made in court, between 2009 and June 2012, Deo Buddhu sold a debt elimination “program” to vulnerable individuals through various businesses, including Paradise Consulting Service, Hema, Inc., and Secured Redemption. In exchange for substantial fees, Deo Buddhu told victims about a little-known government fund that could be used to pay off their mortgages and other debts. In fact, no such fund exists. Buddhu instructed his victims to stop making payments on their mortgages, credit cards and other debts, and to stop paying their property taxes. He also provided his victims with fictitious promissory notes, which he called “bonds,” as well as other frivolous documentation, and advised his victims to use them to pay their debts.
Using her Connecticut Notary Public license, SUNITA BUDDHU assisted her father in the business by preparing, notarizing and mailing the fraudulent documents used in the scheme, including the fictitious bonds.
By ceasing their mortgage payments and other obligations, many of the victims have lost or are in the process of losing their homes to foreclosure.
SUNITA BUDDHU has been detained since her arrest on June 13, 2012. On October 10, 2012, she pleaded guilty to one count of passing and presenting a fictitious financial instrument.
On June 25, 2013, a jury found Deo Buddhu guilty of six counts of mail fraud and seven counts of passing and presenting fictitious financial instruments. He is scheduled to be sentenced on November 4, 2013.
Deo Buddhu has been detained since his arrest on June 11, 2012.Judge Thompson will issue a restitution order after further court proceedings.
This matter was investigated by the Internal Revenue Service – Criminal Investigation and the U.S. Department of Housing and Urban Development – Office of Inspector General, with assistance from the Wethersfield Police Department.
The case is being prosecuted by Assistant U.S. Attorneys Lisa Perkins and Liam Brennan.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Wanblee Man Sentenced for Distribution of A Controlled SubstanceRead the Press Release
United States Attorney Brendan V. Johnson announced that a Wanblee, South Dakota, man convicted of Distribution of a Controlled Substance was sentenced on October 24, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Steven James Bull Bear, age 48, was sentenced to time served, 2 years' supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
On November 5, 2012, Bull Bear sold 26.6 grams of marijuana near Kyle, South Dakota, to an individual cooperating with law enforcement officers. Bull Bear pled guilty to the charge Distribution of a Controlled Substance on July 16, 2013.
This case was investigated by the Northern Plains Safe Trails Drug Enforcement Task Force, the Federal Bureau of Investigation, the Bureau of Indian Affairs Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Ted L. McBride prosecuted the case.United States Attorney RichardS. Hartunian, Troy Mayor Lou Rosamilia and Troy Police Commissioner Anthony D. Magnetto will be holding a press conferenceRead the Press Release
ALBANY, NEW YORK- United States Attorney RichardS. Hartunian announces he will hold a press conference with Troy Mayor Lou Rosamilia and Troy Police Commissioner Anthony D. Magnetto on Friday, November 1st at 10 AM at the Troy Middle School, 1976 Burdett Avenue, Troy, NY 12180.
Press releases and additional information will be available at the press conference.
PRESS CONFERENCE
FRIDAY, NOVEMBER 1sT
10:00 am
TROY MIDDLE SCHOOL
Troy Room
1976 Burdett Avenue, Troy, NY 12180United States Attorney Remarks Regarding Kendrick Johnson InvestigationRead the Press Release
Good afternoon. I’m Michael Moore, the United States Attorney for the Middle District of Georgia. This afternoon I want to make a few remarks concerning the investigation into the death of
Kendrick Johnson. Let me take a minute to thank you for the interest you have shown in this matter, and for coming today.As you know, the body of Kendrick Johnson was found by students on January 11, 2013, in the gym of the Lowndes County High School.
The Lowndes County Sheriff’s Department conducted an investigation into the circumstances surrounding Mr. Johnson’s death. As is customary, a GBI pathologist conducted an autopsy of the body. The investigators concluded that Kendrick Johnson’s cause of death was positional asphyxia, as a result of becoming accidentally lodged in the mat.
Shortly after the results of the autopsy were released, and the investigation closed by the Lowndes County Sheriff’s Department, my office was contacted by the family’s attorney who requested a review of the local investigation.
At that time, I requested and received a copy of the complete investigative file from the Lowndes County Sheriff’s Department. The investigative file included reports, photographs, videos, statements, and a number of other records.
In late August, I received a copy of the second autopsy report, which reached a different conclusion as to the cause of Kendrick Johnson’s death.
For several months now, my office has been continuously engaged in obtaining and reviewing all of the evidence, case reports, and other investigative findings that are available pertaining to the death of Kendrick Johnson. Those efforts are ongoing.
As part of that process, there are several questions that must be answered or confirmed. First, what was the cause of Mr. Johnson’s death? Second, was Mr. Johnson’s death the result of a crima? Third, if Mr.
Johnson’s death was the result of a crime, who committed that crime? Fourth, if a crime was committed, who has the jurisdiction to investigate and prosecute those responsible?
Federal jurisdiction is limited, and there may be circumstances where even if it is determined that Kendrick Johnson died as a result of a criminal act, it may not be a crime which could be prosecuted in federal court.
My office has received and reviewed the official documents and conclusions resulting from the initial investigation. I have personally reviewed these documents and have spoken to individuals involved in this investigation.
I have offered, through their attorney, to meet with the Johnson family. I have met with the family’s investigator and reviewed a number of documents that he has provided. I asked the attorney representing the family to provide me with the full report from his investigator and any other evidence or information which he has developed. I received this information two weeks ago.
We have also asked the public to come forward with any additional information they may have. We are reviewing hundreds of telephone calls we have received about the case to determine if any relevant information exists. If anyone has factual and specific information relating to Mr. Johnson’s death, please contact my office at (478) 621-2701.
Many people have already called to express their concerns, fears and opinions about Mr. Johnson’s death and the subsequent investigation. We appreciate the depth of the concern these callers have expressed, but at this time what we need are people with actual facts and knowledge of the circumstances surrounding Mr. Johnson’s death to present those to us. Facts, not feelings and opinions, no matter how sincere, are the basis of a legal investigation.
At this time, I am of the opinion that a sufficient basis exists for my office to conduct a formal review of the facts and investigation surrounding the death of Kendrick Johnson. I do this with an open mind, neither accepting nor rejecting the opinions of anyone who has previously investigated the circumstances of Mr. Johnson’s death.
At my request, the FBI is cooperating with us in our efforts. Should sufficient information be developed to warrant a criminal civil rights investigation, I will ask the FBI to open a civil rights, or any other appropriate, investigation.
As the United States Attorney, and within the confines of appropriate federal jurisdiction, I am committed to following the facts wherever they may lead. My objective is to discover the truth, and I believe that can only be done by gathering all of the relevant information surrounding Mr. Johnson’s death. I am committed to doing everything in my power to answer the questions that exist in this case, or as many of them that we can.
As those of you who have covered my office or the Department of Justice in general know, we do not typically comment on pending investigations. Because this is now an ongoing investigation, I am not going to take any questions at this time. Going forward, I will not be making any public comments about this matter until my investigative review is complete.
I want to assure each of you, Mr. Johnson’s family, the law enforcement agencies, the local community and all of those who are interested in or have been affected by these tragic circumstances that my goal is to follow the facts, apply the law, and protect the independence and objectivity of the investigative process.
Thank you all very much.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
US Government Intervenes in False Claims Lawsuit Against United States Investigations Services for Failing to Perform Required Quality Reviews of Background InvestigationsRead the Press Release
Washington - The government has intervened in a lawsuit filed under the False Claims Act against United States Investigations Services LLC (USIS) in the U.S. District Court for the Middle District of Alabama, the Department of Justice announced today. The lawsuit alleges that USIS, located in Falls Church, Va., failed to perform quality control reviews in connection with its background investigations for the U.S. Office of Personnel Management (OPM).
The lawsuit was filed by a former employee of USIS, Blake Percival, under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties, known as relators, to sue on behalf of the government when they believe false claims for government funds have been submitted. The private party is entitled to receive a share of any funds recovered through the lawsuit. The False Claims Act also permits the government to investigate the allegations made in the relator’s complaint and to decide whether to intervene in the lawsuit, and to recover three times its damages plus civil penalties. The government is intervening now based on the results of its investigation of the relator’s allegations and has requested that the court give it until Jan. 22, 2014, to file its own complaint.
“We will not tolerate shortcuts taken by companies that we have entrusted with vetting individuals to be given access to our country’s sensitive and secret information,” said Stuart F. Delery, Assistant Attorney General for the Justice Department’s Civil Division. “The Justice Department will take action against those who charge the taxpayers for services they failed to provide, especially when their non-performance could place our country’s security at risk.”
Since 1996, USIS has contracted with OPM to perform background investigations on individuals seeking employment with various federal agencies. Executed in 2006, the contract at issue in the lawsuit required USIS to conduct the investigatory fieldwork on each prospective applicant. It also required that a trained USIS Reviewer perform a full review of each background investigation to ensure it conformed to OPM standards before sending the file back to OPM for processing.
According to the relator’s complaint, starting in 2008, USIS engaged in a practice known at USIS as “dumping.” Specifically, USIS used a proprietary computer software program to automatically release to OPM background investigations that had not gone through the full review process and thus were not complete. USIS allegedly would dump cases to meet revenue targets and maximize its profits. The lawsuit alleges that USIS concealed this practice from OPM and improperly billed OPM for background investigations it knew were not performed in accordance with the contract.
“Thorough, appropriate and accurate background checks are essential in the employment of government personnel,” said George L. Beck Jr., U.S. Attorney for the Middle District of Alabama. “The increase in foreign and domestic terrorism places an increased responsibility on our government to ensure that unsuitable individuals are prohibited from government employment.”
“This is a clarion call for accountability,” said Patrick E. McFarland, Inspector General of OPM. “As recent events have shown, it is vital for the safety and security of Americans to have these background investigations performed in a thorough and accurate manner. We can accept no less. Those responsible for any malfeasance that compromises the integrity of the background investigations process must be held accountable.”
“OPM does not tolerate fraud or falsification,” said Elaine Kaplan, Acting Director of OPM. “We work hard to prevent and detect both through a variety of means including a robust integrity assurance program, multiple levels of review and workforce education and training. We also work hand in hand with our Inspector General and the Department of Justice when we discover fraud so that bad actors are held accountable to the fullest extent of the law.”
This matter was handled by the Commercial Litigation Branch of the Justice Department’s Civil Division and the U.S. Attorney’s Office for the Middle District of Alabama in conjunction with OPM’s Office of Inspector General and Federal Investigative Service.
The claims asserted against USIS are allegations only, and there has been no determination of liability.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617U.S. Secret Service’s National Threat Assessment Center Provides Training to Law Enforcement, School Personnel and Campus Officials in WorcesterRead the Press Release
U.S. Secret Service’s National Threat Assessment Center Provides Training to Law Enforcement, School Personnel and Campus Officials in Worcester
BOSTON – The United States Attorney’s Office, Worcester County District Attorney’s Office, Worcester County Sheriff’s Office and U.S. Secret Service’s Boston office today hosted researchers from the National Threat Assessment Center (NTAC) to provide law enforcement, school personnel and university officials with information on Managing Threatening Situations and Creating Safe School Climates. Over 200 attended the conference which was held at Worcester Technical High School.During the conference, participants were provided information on the foundations of threat assessment which is a behavior-based approach used by law enforcement and others to identify and assess those individuals who pose a risk of engaging in targeted violence. NTAC also highlighted its research related to school safety and the adaption of the threat assessment approach in both K-12 and higher education settings. They also discussed how privacy laws such as HIPAA and FERPA can impact the ability to identify students of concern, and provided participants with information on types of information that can be shared to assist with a threat assessment investigation.
“We are very grateful to the U.S. Secret Service’s NTAC for sharing their expertise on how to develop a comprehensive plan to prevent targeted violence,” said United States Attorney Carmen M. Ortiz. “It is our hope that the information provided today will provide law enforcement, schools and universities with additional tools on how to establish a culture that promotes and implements effective violence prevention and intervention strategies.”
“Having the most innovative programs and best teachers doesn’t matter if we can’t put our children in a safe environment every day,” said Worcester County District Attorney Joseph D. Early Jr. “The experts from the Secret Service gave us a lot of great information today that will help keep our children safe.”"It's an honor for the Sheriff's Office to partner with District Attorney Early, U.S. Attorney Carmen Ortiz and the U.S. Secret Service for the Annual Safe School Summit,” said Worcester County Sheriff Lewis G. Evangelidis. “Today's forum provides us with a great opportunity to share critical public safety information on topics such as violence prevention and emergency response to facilitate a safe school climate. Addressing these important safety issues underscores our commitment to making sure our students and teachers always feel safe and secure in their school environment."
For more information on the National Threat Assessment Center and its research, please visit http://www.secretservice.gov/ntac.shtml
For information on the Department of Justice’s Defending Childhood Initiative, please visit http://www.justice.gov/defendingchildhood/ and http://www.futureswithoutviolence.org/section/our_work/child_wellbeing/defending_childhood_initiative
U.S. Attorney's Office Reminds New Jersey Voters to Use Election Day Hotline for Complaints of Voting Irregularities or AbusesRead the Press Release
NEWARK, N.J. – Tuesday, Nov. 5, 2013, is New Jersey’s general election, and U.S. Attorney Paul J. Fishman is reminding voters to use the Election Day Hotline if they suspect voter fraud. The U.S. Attorney’s Office will receive and respond to reports of election irregularities, voter intimidation or any other activities that would interfere with a citizen’s right to vote. The Election Day Hotline – (855) 291-6791 – will be active from Nov. 3, 2013, through Nov. 7, 2013, and staffed live on Election Day.
The Department of Justice and federal law enforcement partners will work with county boards of election and the New Jersey Attorney General’s Office to respond to complaints and direct them to the appropriate authority.
The Justice Department seeks to ensure that all qualified voters have the opportunity to cast their ballots and have their votes counted, without discrimination, intimidation or fraud.
Established in 2010, this yearly initiative is intended to foster public confidence in the integrity of the election process by providing local points of contact within the Justice Department for the public to report possible election fraud and voting rights violations while the polls are open on Election Day.
The Justice Department and federal investigative agencies, led by the FBI, work cooperatively with the state Attorney General’s Office, under the direction of Acting Attorney General John Jay Hoffman, to enforce voters’ rights at the polls.13-424
Two Plead Guilty in Wire Fraud SchemeRead the Press Release
LYNCHBURG, VIRGINIA – A pair of men who were returning stolen or clearance items to local home improvement stores for profit pled guilty yesterday in the United States District Court for the Western District of Virginia in Lynchburg to wire fraud charges.
Desirique Darnell Rorie, 38, and Alphonzo Jermaine Christian, 35, both of Charlotte, North Carolina, each pled guilty yesterday to one count of conspiracy to commit wire fraud.
“These two individuals devised a scheme that defrauded a major home improvement store out of more than $400,000.” United States Attorney Timothy J. Heaphy said today. “Through the hard work of law enforcement professionals in multiple jurisdictions, they have been held accountable for their actions.”
Rorie and Christian admitted yesterday to conspiring to defraud Lowe’s Home Improvement stores in Virginia, North Carolina, South Carolina and Georgia. It was part of the scheme for merchandise to either be stolen or purchased on clearance from Lowe’s stores and later returned, at full price, in exchange for Lowe’s gift cards. The gift cards were later sold on the street for cash.
Rorie and Christian also admitted to using several co-conspirators, or “Boosters,” to steal or purchase products on clearance, from Lowe’s stores. They also hired “returners” to return items. These “boosters” and “returners” were paid cash for their services. Often times the “boosters” and “returners” were recruited from homeless shelters, soup kitchens, people off the street or family and friends.
At sentencing, both Rorie and Christian face a maximum possible penalty of up to five years in prison and/or a fine of up to $250,000.
The investigation of the case was conducted by the United States Secret Service, the Roanoke County Police Department and the Roanoke County Commonwealth Attorney’s Office. Assistant United States Attorney Charlene R. Day will prosecute the case for the United States.
Two Jackson Men Plead Guilty in Molotov Cocktail CaseRead the Press Release
Jackson, Miss. -- Joshua Martin, 22, and Lemarkcus Kelly, 22 of Jackson, pled guilty in U.S. District Court today to possession of illegal explosives, specifically Molotov cocktails, announced U.S. Attorney Gregory K. Davis and ATF Special Agent in Charge Phillip Durham.
Martin and Kelly were apprehended on January 23, 2013 by officers from the Jackson Police Department just moments after a shooting occurred in South Jackson. Martin and Kelly were two of the four passengers in the vehicle witnesses reported were outside a South Jackson home into which shots had been fired. When the JPD officers stopped the vehicle, Martin, Kelly, and the two other occupants of the vehicle had in their possession several firearms and glass bottles, which contained gasoline and which were stuffed with shredded clothing material to be used as wicks.
ATF Special Agent in Charge Phillip Durham said: “This joint investigation between ATF, the Jackson Police Department and the Jackson Fire Department illustrates the impact on reducing violent crime when agencies combine and coordinate their skills and resources. This investigation is an example of excellent investigative work, a job well done by the investigators.”
Both defendants will be sentenced by U.S. District Judge Carlton W. Reeves on January 17, 2014, at 9:00 a.m. They each face a maximum sentence of 10 years in prison and a $250,000 fine.
This case was investigated by the Bureau of Alcohol, Tobacco and Firearms and the Jackson Police Department with the assistance of the Jackson Fire Department. The case was prosecuted by Assistant U.S. Attorneys Mary Helen Wall and Scott Gilbert.###
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:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Our nation-wide commitment to reducing gun crime in America.
Two Dozen Charged After Dea Task Force Takes Down Coast to Coast Narcotics Distribution RingRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, John J. Arvanitis, Special Agent in Charge of the Drug Enforcement Administration in New England, New Britain Police Chief James Wardwell and Wethersfield Police Chief James Cetran today announced that 24 individuals have been charged in a 14-count superseding indictment with narcotics distribution and related offenses stemming from a long-term investigation into a coast to coast drug trafficking ring.
As alleged in court documents and statements made in court, in January 2013, the DEA’s Hartford Task Force began an investigation into the narcotics distribution activities of LUIS FERNANDEZ of East Hartford. The investigation, which included the use of court-authorized wiretaps and controlled purchases of narcotics, revealed that FERNANDEZ’s family members and associates in southern California shipped heroin, cocaine and marijuana to FERNANDEZ at various addresses in the Hartford area. FERNANDEZ also was supplied with narcotics from individuals in New York. FERNANDEZ then sold the drugs to customers in Connecticut.
“Thanks to the diligent efforts of DEA’s Hartford Task Force, a drug pipeline from California to Connecticut has been shut down,” stated acting U.S. Attorney Daly. “All of the police departments who participate on the task force, notably the New Britain and Wethersfield Police Departments whose officers spearheaded this investigation, have devoted significant time and resources to rid our community of narcotics and their negative effects. I also want to thank our many federal and state law enforcement partners who contributed to this successful investigation.”
“Heroin destroys individuals, families and communities,” stated DEA Special Agent in Charge Arvanitis. “DEA and our partners are committed to dismantling criminal organizations that attempt to flood our neighborhoods with heroin and other drugs. These enforcement successes are a direct result of the combined efforts of DEA, along with our state and local partners.”
“The results of the collaborative efforts of the DEA and the local departments continue to bring amazing results,” stated New Britain Police Chief Wardwell. “New Britain’s Detective Frank Bellizzi, who is assigned to the DEA’s task force, represents the New Britain Police Department very well through his professionalism and dedication. I am very proud of Detective Bellizzi’s outstanding work investigating high level drug trafficking, particularly his work in this investigation. The work being done here makes a dramatic impact in all our communities by helping to rid this poison from our streets and reduce violent crimes. The New Britain Police Department remains committed to its partnership with law enforcement agencies on the local, state, and federal level to continue to address these issues as they arise.”
“We made a commitment to the DEA Task Force several years back to help rid our community of the scourge of illegal drugs,” stated Wethersfield Police Chief Cetran. “Arresting local drug users did seem to be making a difference but we could see there had to be more; a two-prong attack. Drugs are a local, regional, and nationwide problem that affects all of our citizens either through direct association with drug users or the crimes related to drug use that include property crimes and crimes against persons. The officer we assigned to the task force, Officer Jeff Poulin, has done an excellent job as part of the team of local, state, and federal investigators overall, and as part of this investigation. We can see the results of the task force’s efforts on daily basis by the number of arrests and convictions in high level trafficking of drugs cases. The results of these arrests and convictions trickle down to the streets of our communities by lessening the availability of illegal drugs to drug users who commit the local crimes. We plan to continue to make this sacrifice and commitment as it is worthwhile and delivers results.”
Charged in the indictment are:
LUIS FERNANDEZ, 30, of East Hartford
FERNANDO FERNANDEZ-GARZA, a.k.a. “Juan Carlos Garza” and “Don Fernando, 49, of Artesia, Calif.
LAWRENCE CHAMBERS, 34, of East Hartford
ERIC COLON, 27, of Hartford
CHAZ DASILVA, 20, of Newington
JESUS FERNANDEZ, a.k.a. “Guerro” and “Guate,” 28, of East Hartford
RICARDO FERNANDEZ, a.k.a. “Pepe,” 19, of East Hartford
SANDI FERNANDEZ, 27, of Artesia, Calif.
JULIO CESAR DE LA ROSA, a.k.a. “Negro,” 25, of Hartford
RAMON GALVEZ, a.k.a. “Tanky,” 38, of New York, N.Y.
EVANGELINA GARZA, 47, of Artesia, Calif.
MICHAEL HAYNES, 27, of East Hartford
ALBERTO HERNANDEZ, 32, of New Britain
CHARLES KELLEY, 39, of Hartford
CARLOS MERCADO, a.k.a. “Los,” 27, of Hartford
BOLIVAR NERIS-RECIO, a.k.a. “Pablo” and “Tigre,” 32, of New York, N.Y.
KAREN ORTEGA, 27, of Lynwood, Calif.
JOSE RIVERA-BARON, a.k.a. “Mexico” and “Chyks, 30,” of East Hartford
JOSE DEJESUS RIVERA, a.k.a. “Chuy,” 24, of Pomona, Calif.
ARMANDO RUELAS-RANGEL, 38, of Harwinton
JOSHUA SAEZ, 24, of Hartford
THOMAS SANCHEZ, 25, of New BritainThe indictment was returned by a grand jury in Hartford on October 1, 2013. The investigation culminated on October 9 when a majority of the defendants were arrested. To date, 22 of the defendants have been arrested and two are currently being sought by law enforcement.
During the course of the investigation, law enforcement has seized approximately four kilograms of heroin, approximately 100 pounds of marijuana and more than $150,000 in cash.
The indictment alleges that all of the defendants, with the exception of HERNANDEZ, SAEZ and SANCHEZ, conspired to possess with intent to distribute various quantities of heroin and/or cocaine. In addition, LUIS FERNANDEZ, CHAMBERS, DASILVA, JESUS FERNANDEZ, DEJESUS RIVERA and RUELAS-RANGEL are charged in one or more counts with possession with intent to distribute heroin.
The indictment also charges COLON with SAEZ with interference with commerce by robbery, and SAEZ with possession of a firearm by a convicted felon, use of a firearm during and in relation to a crime of violence, and possession with intent to distribute heroin. These charges stem from an incident on August 16 when it is alleged that COLON and SAEZ robbed RIVERA-BARON of heroin.
Finally, the indictment charges HERNANDEZ and SANCHEZ with attempted possession with intent to distribute heroin on July 24. On that date, law enforcement officers seized $3,495 from HERNANDEZ and SANCHEZ in Wethersfield.
During the course of the investigation, on August 7, 2013, Hartford Police attempted to stop a vehicle after receiving information from the DEA Task Force that one of the vehicle’s three occupants had allegedly purchased narcotics from a member of the conspiracy. The vehicle drove from police at a high rate of speed and crashed into a tree, and the occupants fled. Officers apprehended two of the three individuals, one of whom was subsequently identified as Carlos Ramos, 23, of Hartford. Ramos has four outstanding arrest warrants from Puerto Rico, including a warrant for murder and another for shooting at a police officer. He is currently in state custody.
Acting U.S. Attorney Daly stressed that an indictment 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 case has been assigned to U.S. District Judge Stefan R. Underhill in Bridgeport.
This investigation is being led by the Drug Enforcement Administration’s Hartford Task Force, which includes personnel from the DEA Hartford Resident Office and the Bristol, Hartford, Manchester, New Britain, Newington, and Wethersfield Police Departments, with the valuable assistance of DEA Los Angeles Field Division HIDTA Group 42. Agencies assisting the investigation include the DEA in New Haven, Bridgeport, Los Angeles and Panama, Federal Bureau of Investigation, U.S. Marshals Service, U.S. Department of Homeland Security, U.S. Postal Inspection Service, Connecticut State Police, State of Connecticut Office of Adult Probation, and the Hartford, East Hartford and New Britain Police Departments.
The case is being prosecuted by Assistant U.S. Attorney S. Dave Vatti and Special Assistant U.S. Attorney Natasha M. Dye
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Tabor City Farmer Sentenced for His Part in Tobacco Insurance Fraud ScamRead the Press Release
RALEIGH - United States Attorney Thomas G. Walker announced that in federal court today Chief United States District Judge James C. Dever, III, has sentenced PATRICK REX LOVETT, 48, of Tabor City, North Carolinato 5 years probations with 9 months of house arrest. The Court also imposed a fine of $10,000 and ordered forfeiture in the amount of $160,696.
The criminal investigation of this case was conducted by United States Department of Agriculture – Office of the Inspector General – Investigations, the United States Department of Agriculture - Risk Management Agency – Special Investigations Branch, and the Internal Revenue Service - Criminal Investigation. Assistant United States Attorney Banumathi Rangarajan is handling the prosecution on behalf of the Eastern District of North Carolina.
On February 19, 2013, LOVETT pled to structuring transactions to evade reporting requirements, in violation of Title 31, United States Code, Sections, 5324(a)(3) and (d)(2).
According to the Criminal Information filed on November 26, 2012, and information presented in open court, LOVETT structured 22 currency transactions totaling $160,696.00 with one or more domestic financial institutions for the purpose of evading the legal obligation to report currency transactions in excess of $10,000. Six of the structured transactions, totaling $49,118, related to the sale of hidden tobacco. Those sales were not reported to the United States Department of Agriculture and LOVETT did not report the income on his tax returns until he amended the tax returns pursuant to his plea agreement.
This case is part of the ongoing investigation of the multi-million dollar crop insurance fraud in Columbus County.Settlement Reached with Warren County, N.C., Board of Education to Resolve Employment Rights Claim of Army Reserve SoldierRead the Press Release
The Justice Department announced a settlement today with the Warren County, N.C. Board of Education that resolves a lawsuit the department filed on behalf of Army Reserve soldier Dwayne Coffer under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).
The settlement, which was filed as a consent agreement in the U.S. District Court for the Eastern District of North Carolina, resolves allegations that the Warren County Board of Education willfully violated USERRA by not renewing Coffer’s employment contract in 2008 because of his military service obligations. Coffer, a Sergeant First Class in the U.S. Army Reserve, worked at Warren County High School as an assistant principal. During his employment with the county, Coffer took periodic leave from work to fulfill his military obligations, including service in Kuwait and Afghanistan from February 2004 to February 2005. According to the department’s complaint, the board did not renew Coffer’s contract as an assistant principal in 2008 because staff members expressed frustration at accommodating his military service during the school year.
USERRA prohibits employers from discriminating against servicemembers with respect to employment opportunities based on their past, current or future uniformed service obligations. USERRA also requires employers to promptly reemploy service members following their return from military leave. Under the terms of the consent agreement, the Warren County Board of Education will, among other stipulations, reemploy Coffer under a two-year contract as a Lead Teacher/Site Supervisor at the salary he would have received had he remained continuously employed by the county, pay back-pay to Coffer in the amount of $10,000 and contribute lost retirement payments to Coffer’s retirement account in the amount of $13,702.63.
“USERRA affords military members who leave their civilian careers behind for significant periods of time to serve our country certain protections against unjust terminations,” said Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division. “It is important that veterans have the opportunity to serve their country free from worry about termination without cause.”
“I am pleased we were able to resolve this matter,” said U.S. Attorney Thomas G. Walker. “Improper job terminations over military service cannot be tolerated.”
The department initiated the lawsuit after Coffer filed a complaint with the Labor Department’s Veterans’ Employment and Training Service, which investigated the matter and determined that the complaint had merit. This case was handled by the Employment Litigation Section of the Civil Rights Division and the U.S. Attorney’s Office for the Eastern District of North Carolina.
Additional information about USERRA can be found on the Justice Department websites www.usdoj.gov/crt/emp and www.servicemembers.gov , as well as the Labor Department website www.dol.gov/vets/programs/userra/main.htm .
Sentences for October 28 – 29, 2013Read the Press Release
Julia Carlene Deshaw, 45, of Casper, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on October 29, 2013, for conspiracy to possess with intent to distribute, and to distributing at least 200 grams but less than 350 grams of methamphetamine. Deshaw was arrested in Casper, Wyoming. She received 120 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $400.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Michael Ainsworth, 51, of Casper, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on October 29, 2013, for being a felon in possession of a firearm. Ainsworth was arrested in Casper, Wyoming. He received three months imprisonment, to be followed by one year of unsupervised probation, and was ordered to pay a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Harold and Amy Busskohl, husband and wife, of Lyman, Wyoming, were sentenced by Federal District Court Judge Alan B. Johnson on October 28, 2013, for health care fraud. The Busskohls appeared pursuant to a summons. Both received a three-year term of supervised release and each was ordered to pay a $100.00 special assessment. In addition, the Court ordered that they pay restitution, joint and several, in the amount of $35,285.67. This case was investigated by the Wyoming Medicaid Fraud Control Unit.
Brian L. Messick, 43, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on October 28, 2013, for conspiracy to possess with intent to distribute, and to distributing 1,372 grams of methamphetamine. Messick was arrested in Cheyenne, Wyoming. He received 120 months imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and a $400.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
Dale R. Turano, 54, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on October 28, 2013, for conspiracy to possess with intent to distribute, and to distributing 198 grams of methamphetamine. Turano was arrested in Cheyenne, Wyoming. He received 151 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation.
James P. Graham, 53, of Cheyenne, Wyoming, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on October 28, 2013, for conspiracy to possess with intent to distribute, and to distributing 200-300 grams of methamphetamine. Graham was arrested in Cheyenne, Wyoming. He received 100 months imprisonment, to be followed by four years of supervised release, and was ordered to pay a $100.00 special assessment and a $500.00 fine. This case was investigated by the Wyoming Division of Criminal Investigation.
San Antonio Man Pleads Guilty to Sex Trafficking of A MinorRead the Press Release
Pelly Lee Mason, age 51, faces not less than thirty years and up to life in federal prison after pleading guilty to transporting a minor across state lines with intent to engage in criminal sexual activity.
Mason came to the attention of law enforcement after a victim’s parent reported that Mason had performed sexual acts on her minor child. The sexual acts had occurred on several occasions during a trip from Flagstaff, Arizona, to Orlando, Florida. Some of the acts occurred while they were in San Antonio, Texas. Mason admitted to having performed sexual acts on the minor child during this trip. Mason has previously been convicted of engaging in lewd and lascivious conduct with a minor for which he served five years in prison. As a result of that conviction, Mason was required to register as a sex offender but failed to register upon his release from prison. Seven other victims have been identified since his arrest early this year.
This case is being investigated by the Federal Bureau of Investigation (FBI). Assistant United States Attorney Bettina Richardson is prosecuting this case on behalf of the Government.
Robeson County Farmer Sentenced in Million Dollar Crop Insurance Fraud, Aggravated Identity Theft, Firearm Offense, and Threat to Law EnforcementRead the Press Release
RALEIGH - United States Attorney Thomas G. Walker announced that in federal court today Chief United States District Judge James C. Dever III, sentenced HARRY DEAN CANADY, 63, of Lumberton, North Carolinato a total of 72 months imprisonment followed by 5 years supervised release. The Court also ordered CANADY to pay restitution in the amount of $1,036,516.
On December 19, 2012, CANADY pled guilty to the following offenses: conspiracy to make false statements, to make material false statements, and to commit mail and wire fraud; false statements to the Federal Crop Insurance Corporation; aggravated identity theft; felon in unlawful possession of a firearm; and retaliation against a federal official in violation of Title 18, United States Code, Section 115.
U.S. Attorney Walker stated, “This investigation exemplifies how our nation’s law enforcement officers place their lives at risk in the investigations of crimes, even white collar offenses. Such intimidation tactics will not be tolerated in the pursuit of justice for the American people and the protection of public funds.”
“USDA-OIG-Investigations remains committed to working with the U.S. Attorney’s Office and our law enforcement partners to bring those to justice who willfully violate the law, threaten our agents, and facilitate fraud against USDA programs. Threatening federal agents is a serious offense. USDA-OIG will always take action to protect its law enforcement agents from such threats”, said Karen Citizen-Wilcox, Special Agent-in-Charge.
"It is very rewarding to see these people sentenced after such a complex and exhausting investigation by our special agents and our law enforcement partners," said Special Agent in Charge, Jeannine A. Hammett, IRS Criminal Investigation.
According to the Indictment returned by a federal grand jury on June 13, 2012, court filings, and information presented in open court, CANADY owned and rented farmland in Robeson County, North Carolina, and produced, among other crops, tobacco, corn, wheat, and soybeans. From August 2006 through December 2009, CANADY conspired with others to commit fraud upon the federal crop insurance program. It was the purpose of the conspiracy to profit through the filing of false, fictitious, and fraudulent federal crop insurance claims, the sale of unreported tobacco and other grains, and to hide the criminal proceeds through payments and sales in nominee names.
Specifically, CANADY worked with a co-conspiring insurance agent, warehousemen, brokers, and adjusters to make false crop insurance claims, and to hide some or all of his crop production by selling it in nominee names or the names of family members, or for cash to co-conspiring warehousemen.
The investigation revealed that CANADY profited under the scheme because he was paid twice for each pound or bushel of his crop: once through the false crop insurance claim, and also through the sale of the “hidden” tobacco or “hidden” grain. CANADY and other co-conspirators misrepresented the truth of farm operations in a variety of documents, including applications, reports of actual production history, acreage reports, and claim forms made and submitted in support of crop insurance coverage and claims that failed to truthfully show who had an insurable interest and who really suffered a loss and the extent of that loss which were submitted to the Risk Management Agency, an agency of the United States Department of Agriculture, and private entities.
For example, law enforcement determined that CANADY, without authorization, used the name of his grandchildren, to hide some of his soybean production. Specifically, on January 21, 2008, CANADY declared that he only produced, harvested, and sold 7,192 bushels of soybeans, when in fact, he sold an additional 2,261 bushels of soybeans in the name of his grandchildren. By failing to disclose the sales in his grandchildren’s name, CANADY was paid $99,537 on a false claim.
The investigation further revealed that CANADY took the criminal proceeds obtained through other acts of aggravated identity theft and federal crop insurance fraud, and engaged in various financial transactions with those funds, including causing his daughter to deposit an $84,655.97 check into a financial institution and to transfer the funds to an account controlled by him. These funds were derived from the unreported sale of 23,730 bushels of corn in the name of a grandchild.
In an effort to increase the amount of money he could defraud from the federal crop insurance program, CANADY created and used a new corporation, MC FARMS CO., INC. CANADY caused another person to submit false documents to the Farm Service Agency, and the federal crop insurance program under that corporation name.
During the course of the investigation, law enforcement received information that CANADY unlawfully possessed firearms. During the execution of a November 22, 2010, search warrant, officers recovered 6 firearms and over 180 rounds of ammunition. CANADY had been previously convicted of involuntary manslaughter, a crime punishable by a term of imprisonment exceeding one year.
CANADY, who was aware of the federal investigation since at least 2008, made several threats against law enforcement. Most recently, on January 23, 2012, CANADY threatened to assault and murder a USDA-OIG Special Agent with the intent to retaliate against such law enforcement officer.
As a result of the offense conduct, CANADY fraudulently obtained a total of $1,036,516 worth of federal crop insurance indemnity payments.
The criminal investigation of this case was conducted by United States Department of Agriculture – Office of the Inspector General - Investigations; United States Department of Agriculture - Risk Management Agency – Special Investigations Branch; and the United States Internal Revenue Service – Criminal Investigations. Assistant United States Attorney Banumathi Rangarajan handled the prosecution on behalf of the Eastern District of North Carolina.Retired Iowa State Professor Sentenced for Possession of Child PornographyRead the Press Release
DES MOINES, IA - On Thursday, October 31, 2013, Walter Thomas Meyer, age 69, a retired professor of physics and astronomy at Iowa State University, was sentenced for possession of child pornography, announced U.S. Attorney Nicholas A. Klinefeldt. Mr. Meyer pled guilty to the charge of possession of child pornography on July 24, 2013.
Chief Judge James E. Gritzner sentenced Mr. Meyer to time served, twelve months of home confinement, and five years of supervised release. The sentence of time served was imposed, in part, because the images and movies of prepubescent boys did not depict sexual assault. As a consequence of his conviction, Mr. Meyer will be required to register as a sex offender.
This case was investigated by the United States Postal Inspection Service, and the case was prosecuted by the U.S. Attorney’s Office for the Southern District of Iowa.
(Download Press Release )
Rapid City Man Pleads Guilty to Attempted Sex TraffickingRead the Press Release
United States Attorney Brendan V. Johnson announced that Eric Murphy, age 28, of Rapid City, South Dakota, appeared before U.S. Magistrate Judge Veronica L. Duffy on October 21, 2013, and pled guilty to a charge of Attempted Trafficking with Respect to Involuntary Servitude and Forced Labor.
The charge carries a maximum penalty upon conviction of 20 years and a $250,000 fine. Murphy will be required to register as a sex offender.
On August 3, 2013, as part of a sex-trafficking undercover operation during the Sturgis Motorcycle Rally, Murphy was arrested for attempting to obtain sex with a 12-year old girl. Murphy responded to a law enforcement-generated internet advertisement which advertised sex with a fictitious 12 or 13 year-old girl and negotiated the terms of the sexual encounter. Murphy then met with an undercover agent posing as someone who could provide a young girl, and was subsequently arrested.
The investigation was conducted by the South Dakota Internet Crimes Against Children Taskforce, the South Dakota Division of Criminal Investigation, the Federal Bureau of Investigation, the Rapid City Police Department, the Pennington County Sheriff’s office, and the Meade County Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Sarah B. Collins.
A presentence investigation was ordered and a sentencing date will be set. The defendant was remanded to the custody of the U.S. Marshals Service pending sentencing.Rapid City Man Indicted on Conspiracy to Distribute Controlled SubstancesRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute Controlled Substances.
Gallegos was remanded to the custody of the U.S. Marshals Service. A trial date has yet been set December 17, 2013.
Robert Gallegos, age 35, was indicted on September 24, 2013. He appeared before U.S. Magistrate Judge Veronica L. Duffy on October 25, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is at least 5 years and not more than 40 years’ imprisonment and/or a $5,000,000 fine. The charge is merely an accusation and Gallegos is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Unified Narcotic Enforcement Team, the Drug Enforcement Administration, the Division of Criminal Investigation, and the Rapid City Police Department. Assistant U.S. Attorney Ted L. McBride is prosecuting the case.Rapid City Man Indicted for Conspiracy to Distribute A Controlled Substance and Felon in Possession of A FirearmRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute a Controlled Substance and Felon in Possession of Firearm.
High Wolf was remanded to the custody of the U.S. Marshals Service. A trial date has been set December 17, 2013.
Clayton Charles High Wolf, age 29, was indicted on October 22, 2013. He appeared before U.S. Magistrate Judge Veronica L. Duffy on October 25, 2013, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 40 years’ imprisonment and/or a $5,000,000 fine. The charges are merely an accusation and High Wolf is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Northern Plains Safe Trails Drug Enforcement Task Force, the Division of Criminal Investigation, and the Rapid City Police Department. Special Assistant U.S. Attorney Laura A. Shattuck is prosecuting the case.Pittston ManRead the Press Release
Sentenced For Involvement In Cocaine Distribution Conspiracy
The United States Attorney's Office for the Middle District of Pennsylvania announced today that Senior United States District Court Judge Edwin M. Kosik has sentenced Frank Louis Suriano, age 45, of Pittston, Pennsylvania, to 30 months’ imprisonment for his involvement in a conspiracy to distribute more than 500 grams of cocaine between 2002 and April 2012.
According to United States Attorney Peter J. Smith, Suriano’s role in the conspiracy included driving to New York City on numerous occasions to obtain cocaine for distribution in the Pittston area. A co-conspirator of Suriano, John Estock, was sentenced by Judge Kosik to 24 months’ imprisonment on October 8, 2013. In addition to the 30-month term of imprisonment, Judge Kosik also ordered that Suriano be placed on supervised release for a period of four years following the service of his sentence, and that he pay a $600 fine.The case was investigated by the Federal Bureau of Investigation, the Pennsylvania State Police, and the Pennsylvania Attorney General’s Office. Assistant United States Attorney John Gurganus prosecuted the case
Pine Ridge Man Sentenced for Sexual Abuse of A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that a Pine Ridge, South Dakota, man convicted of Sexual Abuse of a Minor was sentenced on October 25, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Derek Black Elk, age 25, was sentenced to 36 months of imprisonment, 5 years of supervised release, and was ordered to pay $100 to the Federal Crime Victims Fund.
The conviction stems from an incident in March 2009 at a home in Pine Ridge when Black Elk engaged in a sexual act with a girl under the age of 16. Black Elk was indicted in September 2012 and pled guilty to the charge on March 20, 2013.
This case was investigated by the Bureau of Indian Affairs Office of Justice Services. Assistant U.S. Attorney Sarah Collins prosecuted the case.
Black Elk was immediately turned over to the custody of the U.S. Marshals Service.Pine Ridge Man Sentenced for Abusive Sexual Contact and Assaulting A Tribal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Pine Ridge, South Dakota, man convicted of two separate crimes was sentenced for both on October 25, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Kaleb Mills, age 19, convicted of Abusive Sexual Contact, was sentenced to 12 months of imprisonment, 1 year of supervised release, and ordered to pay $25 to the Federal Crime Victims Fund. Mills was also convicted of Assault on a Federal Officer, and sentenced to 36 months of imprisonment, 5 years of supervised release, and ordered to pay $100 to the Federal Crime Victims Fund. The two prison sentences are to run concurrently.
The sexual abuse conviction stems from an April 2012 incident at Pine Ridge, when Mills engaged in sexual contact with a woman who was unwilling and repeatedly voiced her objection. She was in fear of being physically harmed by Mills. The assault conviction is the result of a May 2012 incident, when Mills bumped into an Oglala Sioux Tribe Police Officer with his vehicle after the officer stopped him for speeding and was attempting to give Mills a breathalyzer.
Both cases were investigated by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Sarah Collins prosecuted both cases.
Mills was immediately turned over to the custody of the U.S. Marshals Service.
Pine Ridge Man Guilty of Sexual ContactRead the Press Release
United States Attorney Brendan V. Johnson announced that Patrick Left Hand Bull, age 40, of Pine Ridge, South Dakota, appeared before U.S. Magistrate Judge Veronica L. Duffy on October 24, 2013, and pled guilty to a charge of Abusive Sexual Contact.
The charge carries a maximum penalty upon conviction of 6 years and a $250,000 fine.
On July 23, 2013, Left Hand Bull engaged in sexual contact with a woman who was unable to decline participation.
The investigation was conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. The case is being prosecuted by Assistant U.S. Attorney Sarah B. Collins.
A presentence investigation was ordered and a sentencing date will be set. The defendant was remanded to the custody of the U.S. Marshals Service pending sentencing.Pierre Woman Sentenced for Theft of Government FundsRead the Press Release
United States Attorney Brendan V. Johnson announced that a Pierre, South Dakota, woman convicted of Theft of Government Funds was sentenced on October 28, 2013, by U.S. District Judge Roberto A. Lange.
Brandis Rose Rose, age 38, was sentenced to 1 month in custody, 5 months of home confinement, 3 years of supervised release, $8,418.08 in restitution, and a $100 special assessment to the Federal Crime Victims Fund.
The conviction stems from incidents that occurred when Rose embezzled, stole, purloined or knowingly converted to her own use over $8,000 in Old Age, Survivors, and Disability Insurance (OASDI) and Supplemental Security Income (SSI) program funds to which she was not entitled.
South Dakota CARES (SD CARES) is a Social Security Administration (SSA) approved fee-for-service organizational payee that serves Social Security and SSI beneficiaries in South Dakota. Rose was an employee of SD CARES from July 6 through November 16, 2009. During that time, Rose handled the accounts for 14 beneficiaries that were under her care and control.
SD CARES became concerned about the possibility of misappropriated funds in February 2010 and reported it to the SSA District Office in Huron. The SSA Office of Inspector General conducted an audit and interviewed the 14 beneficiaries under Rose’s care and control. They determined that Rose misappropriated $8,718.08 and converted it to her own use.
The investigation was conducted by the SSA Office of the Inspector General. The case was prosecuted by Assistant U.S. Attorney Jay Miller.
Rose will immediately begin home confinement. She will self-report to the U.S. Marshals Office on January 6, 2014, to begin serving her one month of custody.
Philadelphia Businessman Sentenced in Manhattan Federal Court in Connection with Multiple Investment Fraud SchemesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that TYRONE L. GILLIAMS, JR., a Philadelphia businessman, was sentenced today in Manhattan federal court to 10 years in prison after having been found guilty at trial in February 2013 of engaging in securities and wire fraud in connection with two separate schemes. In the larger of the two schemes, GILLIAMS and co-defendant Everette L. Scott, Jr., solicited and misappropriated $5 million in investments in a bogus United States Treasury Strips investment program. In the other scheme, the defendants solicited and misappropriated a $450,000 investment in a Utah coal mine. In addition to buying luxury cars, jewelry, and other items, GILLIAMS spent hundreds of thousands of dollars of investor money organizing and promoting a multi-day festival in Philadelphia that headlined Sean “Diddy” Combs. GILLIAMS was sentenced today by U.S. District Judge Deborah A. Batts.
Manhattan U.S. Attorney Preet Bharara stated, “With the lengthy sentence imposed today, Tyrone Gilliams has been dealt a penalty appropriate to his unlawful scheme, which took advantage of well-meaning investors and used their money to satisfy his own appetite. Our office is committed to pursuing and prosecuting those who commit similar offenses that victimize innocent investors.”
According to the Indictment and the evidence presented at trial:
In 2009 and 2010, GILLIAMS was the owner of TL Gilliams, LLC, which purported to engage in transactions in commodities like oil and gold. Scott was an attorney at a small law firm in New Jersey and acted as TL Gilliams, LLC’s general counsel.
In the summer of 2010, GILLIAMS solicited $5 million from two investors for purposes of trading in U.S. Treasury Strips, which are a derivative of U.S. Treasury Bonds. GILLIAMS and Scott arranged for the investors to make their investments by wiring them into an attorney trust account maintained by Scott’s law firm. Upon receiving the money, Scott – at GILLIAMS’s direction – misappropriated more than $700,000 to satisfy expenses stemming from an unrelated and failed venture to buy a coal mine in Utah. Scott also claimed $50,000 of the investment money for himself as purported fees. At GILLIAMS’ direction, Scott transferred most of the remainder to bank and brokerage accounts that GILLIAMS controlled.
At most, GILLIAMS purchased $250,000 worth of Treasury Strips with the more than $4 million in investment money transferred by Scott. Over a span of less than six months, GILLIAMS spent more than $1.6 million on an unrelated gold investment; more than $200,000 to purchase a commercial warehouse in Denver; at least $100,000 to buy or lease luxury cars; at least $50,000 for construction work on his home; at least $100,000 on luxury hotel and travel expenses; and more than $500,000 promoting two events. The first event was a festival called “Joy to the World,” which involved an album release party with Jamie Foxx at the Vault nightclub in Philadelphia, and a red carpet, black tie gala at the Philadelphia Ritz-Carlton, headlined for a $120,000 fee by Sean “Diddy” Combs. The second event was a December 2010 comedy performance in Nassau, Bahamas, called the “Gatta Be Jokin’ Comedy Jam.”
GILLIAMS did not engage in any trading of Treasury Strips and, as a result, did not derive any profits. Nonetheless, during the period when he was spending investor money, GILLIAMS provided them with false reports of trades and profits, and made occasional, nominal payments that he falsely claimed represented profits from Treasury Strips trading. Other than these purported profit payments, which totaled approximately $100,000, neither investor received any of their combined $5 million investment back.
In a separate scheme, GILLIAMS and Scott arranged in late 2009 for an investor to transfer $450,000 to Scott’s attorney trust account, to be held in escrow until used in connection with a venture to purchase the assets of a bankrupt Utah coal mine. Once the money was in Scott’s account, he secretly misappropriated approximately $112,000 by claiming it as purported fees, and transferred the rest to GILLIAMS or other individuals and entities at GILLIAMS’ direction. Until August 2010, GILLIAMS and Scott falsely assured the victim that his $450,000 remained safely in escrow, long after Scott’s escrow account had been emptied. Although the victim repeatedly demanded the return of his funds, GILLIAMS and Scott pacified him by producing forged bank documents and a false attorney attestation letter written by Scott purporting to show that GILLIAMS was in possession of the millions of dollars necessary to purchase and operate the Utah coal mine. In August 2010, after an attorney for the victim threatened Scott with professional discipline for his failure to return the escrowed funds, GILLIAMS and Scott paid the victim $450,000 using funds they raised for investment in Treasury Strips.
In addition to the prison term, Judge Batts sentenced GILLIAMS, 46, of Philadelphia, Pennsylvania, to three years of supervised release. GILLIAMS was also ordered to make restitution in the amount of $5 million, to forfeit $5 million, and to pay a $300 special assessment fee.
In September 2013, Scott, 51, of Sewell, New Jersey, was sentenced to a 30 months in prison, to be followed by three years of supervised release.
Mr. Bharara praised the work of the Criminal Investigators of the United States Attorney’s Office and the Federal Bureau of Investigation, which jointly investigated this case. He also thanked the U.S. Securities and Exchange Commission.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive,
coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20
federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition
of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases
against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For
more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Michael A. Levy and David B. Massey are in charge of the prosecution.
Pennsylvania Youth Football Coach, School Cook and Summer Camp Counselor Pleads Guilty to Attempted Online Enticement of A MinorRead the Press Release
WILMINGTON, Del. – Michael J. Barndt, a/k/a “mikecoach73,” age 39, of Sellersville, Pennsylvania, pled guilty today to Attempted Coercion and Enticement of a Minor, in violation of federal law. Charles M. Oberly, III, United States Attorney for the District of Delaware, announced the guilty plea following a hearing in the United States District Court for the District of Delaware, where Barndt will be sentenced by United States District Judge Leonard P. Stark on February 25, 2014.
Barndt faces a mandatory minimum sentence of ten years, and a maximum sentence of life, in prison. He also faces a fine of up to $250,000 and a term of supervised release following his prison sentence of at least five years to life. Barndt also will be required to register as a sex offender in any U.S. jurisdiction in which he lives, works, or attends school.
Prior to his arrest, Barndt was employed as a cook at the Lakeside School in Horsham Township, Pennsylvania. Barndt also served for a number of years as a youth football coach for the Springfield School District, in Montgomery County, Pennsylvania. He last coached in 2012 – the last football season prior to his arrest. During the summer months, Barndt was employed as a camp counselor at “Blue Bell Camp,” in Blue Bell, Pennsylvania, where his duties including coaching football and driving children home from camp.
According to the indictment and court documents, Barndt was arrested on June 19, 2013, after he traveled from his Pennsylvania home to the Concord Mall, in Wilmington, Delaware, to meet a person he believed to be a 14-year-old girl for sexual activity. Barndt identified this supposed 14-year-old girl, who was actually an undercover federal agent, after he posted an on-line personals ad on www.craigslist.com. In the ad, which he entitled, “Real Teen Fantasy,” Barndt expressed interest in a sexual liaison with a teenage girl and engaged in a series of online chats with the undercover agent, which involved Barndt transmitting naked pictures of himself.
Barndt drove to the mall, where he was met by a team of federal agents shortly after purchasing items at Victoria’s Secret. Federal agents seized a smartphone from Barndt, which was later found to contain approximately 15,000 images of teenage females who are either suggestively dressed or partially or completely nude. Most of these images appear to have been self-produced by the teenagers with smartphones.
Following the plea hearing, U.S. Attorney Oberly stated: “While Mr. Barndt will be appropriately punished for his crimes, young people must be especially cautious as to the types of images they produce of themselves on their smartphones. Inappropriate pictures, once in cyberspace, live on forever and can have damaging consequences even years later.”
"Homeland Security Investigations is committed to stopping predators in their tracks. This defendant will no longer be a threat to our children" said John P. Kelleghan, special agent in charge of HSI in Philadelphia. "This case is yet another example of the extraordinary collaborative efforts among law enforcement in Delaware, to protect the most vulnerable among us."
This case is being investigated by the Department of Homeland Security, Homeland Security Investigations and is being prosecuted by Assistant United States Attorney Edward J. McAndrew.
Pastor Pleads Guilty to Wire Fraud as Part of A $5 Million Ponzi SchemeRead the Press Release
DENVER – Pastor Charles Lawrence Kennedy, Jr., age 71, of Tampa, Florida pled guilty before U.S. District Court Judge Christine M. Arguello yesterday to one count of wire fraud federal law enforcement authorities announced. Kennedy, who is free on a bond, is scheduled to be sentenced by Judge Arguello on January 22, 2014. Kennedy was indicted by a federal grand jury in Denver on March 22, 2012, along with co-defendants Stanley Wayne Anderson of Arvada, Colorado and Edwin Alexander Smith of Denver, Colorado. Smith pled guilty to one count of wire fraud on August 27, 2013. Anderson’s trial is scheduled for January 13, 2014.
According to the facts contained in the indictment as well as the stipulated facts contained in the plea agreement, beginning in October of 2005 and continuing through December 2008, Anderson, Smith and Kennedy together with each other, and aiding and abetting other persons known and unknown to the Grand Jury, devised a scheme to defraud investors.
Anderson and Smith resided in Colorado and conducted business through “CFO-5, LLC” and “Trinity International Enterprises, Inc”, two companies they controlled. Trinity had no business operations apart from soliciting investment funds related to an investment program. Anderson was the chairman and chief executive officer of CFO-5 and Trinity. Smith was the secretary of CFO-5 and president of Trinity. Kennedy resided in Florida where he worked as a pastor and conducted business through a company identified as “Keys to Life Corporation". Kennedy through a formal partnership with Trinity assisted Anderson and Smith in soliciting investment funds.
They solicited investors' funds for use in an investment program where significant profits would supposedly be generated through the trading of European medium term notes ("MTN program"). When in fact, the MTN program did not exist. Furthermore, they represented that their MTN program would pay nearly immediate returns in amounts ranging from 200 to 1000 percent.
They raised approximately $5 million dollars from approximately 100 investors nationwide over the course of the scheme. The investors' funds were not used to trade in financial instruments, but were instead misappropriated by Anderson, Smith and Kennedy for unauthorized uses. Investors, with the exception of those who received Ponzi scheme-like payments, that is, money taken from one investor to compensate another, lost their total investments. Anderson and Smith generally commingled and deposited investors' funds into bank accounts controlled by Anderson and Smith.
Kennedy began soliciting investments in December of 2005 from fellow pastors and members of their congregations through his company Keys to Life Corporation and falsely promised that for every $1,000 invested, the minimum return would be $1,000,000 which would be paid within 90 days. From December 2005 through April 2006, Kennedy collected $460,000 from nine investors and forwarded only $145,000 to Trinity for use in the investment pool, and as a result has agreed to pay $315,000 in restitution. Kennedy in fact took a portion of investor funds for his own personal benefit.
“The defendant used his position as a Pastor to solicit funds from investors with promises of substantial returns,” said U.S. Attorney John Walsh. “Instead of investing the funds, he and others used the money for unauthorized purposes. The defendant’s abuse of his position of trust led to 100 people losing their hard earned money, for which the defendant will now face the consequences.”
“Investors should always be wary and cautioned of investment proposals that promise high returns on their investment. ‘If it seems too good to be true’, it is probably an investment scheme,” said Stephen Boyd, Special Agent in Charge for IRS Criminal Investigation, Denver Field Office.
“The FBI has made protecting innocent investors a priority,” said FBI Denver Special Agent in Charge Thomas Ravenelle. “Therefore, we will vigorously investigate those who engage in schemes to defraud members of our communities.”
“Fraud schemes victimize honest hard working individuals,” said Adam P. Behnen, Inspector in Charge, U.S. Postal Inspection Service, Denver Division. “Our inspectors will take every action possible to ensure that people who use the mails for criminal gain are caught and brought to justice.”
Wire fraud carries a penalty of not more than 20 years imprisonment, and up to a $250,000 fine, per count.This case was investigated by the Internal Revenue Service – Criminal Investigation, the Federal Bureau of Investigation, and the United States Postal Inspection Service.
This case is being prosecuted by Assistant U.S. Attorney Timothy Neff.
The charges in the indictment are only allegations, and the defendants are presumed innocent unless and until proven guilty.
####
Owner of Texas-based Ambulance Service Convicted of Health Care FraudRead the Press Release
A federal jury in Houston has convicted Gwendolyn Climmons-Johnson, 53, of multiple counts of health care fraud for submitting false and fraudulent claims to Medicare for ambulance services.
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas made the announcement.
After a three-day trial, the jury convicted Climmons-Johnson on Oct. 30, 2013, of one count of conspiracy to commit health care fraud and four counts of health care fraud. She faces a maximum penalty of 10 years in prison for each count when she is sentenced on Feb. 7, 2014.
According to evidence presented at trial, Climmons-Johnson was the owner and operator of Urgent Response EMS (Urgent Response), a Texas-based entity that purportedly provided non-emergency ambulance services to Medicare beneficiaries in the Houston area. The evidence showed that from January 2010 through December 2011, Climmons-Johnson and others conspired to unlawfully enrich themselves by submitting false and fraudulent claims to Medicare for ambulance services that were medically unnecessary and/or not provided. Climmons-Johnson, who controlled the day-to-day operations of Urgent Response, submitted, and caused to be submitted, approximately $2.4 million in fraudulent ambulance service claims to Medicare.
At trial, the evidence showed that patient records had been falsified and the Medicare beneficiaries for whom Climmons-Johnson had billed ambulance services did not need ambulance services and were not in the condition stated in the records.
The case was investigated by the FBI, the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), and the Texas Attorney General Medicaid Fraud Control Unit. The case was brought as part of the Medicare Fraud Strike Force, under the supervision of the U.S. Attorney’s Office for the Southern District of Texas and the Criminal Division’s Fraud Section.
The case was tried by Assistant Chief Laura M.K. Cordova and Trial Attorney Christopher Cestaro of the Criminal Division’s Fraud Section, with assistance from former Special Assistant U.S. Attorney James S. Seaman.
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, 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.
Norris Man Charged with Sexual Abuse of A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, woman convicted of Second Degree Burglary was sentenced on October 28, 2013, by U.S. District Judge Roberto A. Lange.
Monique Flood, age 19, was sentenced to 43 days in custody with credit for time served, 20 months of supervised release, and $100 to the Federal Crime Victims Fund. She was also ordered to pay restitution in the amount of $3,341.99 to 3 separate burglary victims.
Flood was indicted by a federal grand jury in February of 2013 and pled guilty to Second Degree Burglary on July 11, 2013.
The conviction stems from incidents that took place on January 16, 2013, when Flood and two others burglarized three homes on the Rosebud Reservation and took property that did not belong to them. Two other co-defendants have also been convicted and sentenced on burglary charges regarding these events.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Tim Maher. Flood was released from custody.
Motivational Speaker Pleads Guilty to Failing to File Tax ReturnsRead the Press Release
OAKLAND – William H. Paris, Jr., aka Bubba Paris, pleaded guilty yesterday to one count of failing to file a federal income tax return with the IRS, announced United States Attorney Melinda Haag and Internal Revenue Service, Criminal Investigation Special Agent in Charge José M. Martinez.
Paris, 53, of Discovery Bay, Calif., started Paris Enterprises in 1985, a business where he earned income as a motivational speaker and by selling autographed memorabilia. He was the Chief Executive Officer since its inception until present. Paris also controlled all of the bookkeeping and finances of the business since the year 2006.
According to the plea agreement, Paris admitted that between 2006 and 2008, he willfully failed to file a U.S. Individual Income Tax Return despite earning income. Specifically, Paris earned at least $57,187 in 2006, $83,856 in 2007, and $41,700 in 2008, but failed to report that income to the IRS. Paris also agreed to pay restitution to the IRS in the amount of $126,530.
Paris was charged on February 11, 2013, with three counts of failing to file tax returns. He pleaded guilty to one count. Sentencing is scheduled for February 21, 2014 in front of The Honorable Kandis A. Westmore, U.S. Magistrate Court Judge.
The maximum statutory penalty for each count of failure to file a federal tax return, in violation of Title 26, U.S.C. § 7203, is one year in prison and a fine of $100,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Special Assistant United States Attorney Charles Parker and Assistant United States Attorney Thomas Newman are prosecuting this case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
(Paris information )