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Monday 12 August 2013
Legalized Permanent Resident Sentenced for Meth DistributionRead the Press Release
BOISE – Jesus Jimenez-Valenzuela, 42, of Caldwell, Idaho, was sentenced today in United States District Court to 48 months in prison for distributing at least 50 grams of actual methamphetamine, U.S. Attorney Wendy J. Olson announced. He pleaded guilty to the charge on May 23, 2013.
According to the plea agreement, Jimenez-Valenzuela admitted that on two occasions in September 2012, he possessed and sold a mixture and substance containing actual methamphetamine to an undercover police officer for an initial payoff of a prior $4,200 debt and a later payment of $4,050. The transactions were recorded and monitored by law enforcement. Jimenez-Valenzuela agreed the substance he possessed with intent to distribute was between 50 and 150 grams of actual methamphetamine.
The case was investigated by the Drug Enforcement Administration and Canyon County Sheriff’s Office.
Jefferson County Man Indicted on Methamphetamine Related ChargesRead the Press Release
Alvin Gene Chelf, 42, of Bonnie, IL, was indicted on August 6, 2013, on methamphetamine related charges in an Indictment returned by a Federal Grand Jury sitting in Benton, Illinois, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today.
Chelf was charged in a two count indictment. Count 1 charges that on February 14, 2013, in Jefferson County, Illinois, Chelf knowingly and intentionally distributed methamphetamine. Count 2 charges that on February 19, 2013, in Jefferson County, Illinois, Chelf knowingly and intentionally distributed methamphetamine.
With respect to each count, Chelf faces up to 20 years imprisonment, up to $1,000,000 fine, and at least 3 years supervised release to follow incarceration.
An Indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
The investigation in this case was conducted by the Joint Narcotics Unit of the Mt. Vernon Police Department and the Jefferson County Sheriff’s Department.
The case is being handled by Assistant United States Attorney George Norwood.
Former Tucson Businessman Convicted of Possessing 24 Explosive DevicesRead the Press Release
TUCSON, Ariz. – On Aug, 9, 2013, a federal jury in Tucson found Todd Russell Fries, a.k.a. Todd Burns, 50, of Tucson, guilty of two counts of possession of unregistered explosive devices. The case was tried before U.S. District Judge Cindy K. Jorgenson. Sentencing is set for Oct. 18, 2013, before Judge Jorgenson. Fries is already serving a sentence of 151 months after being convicted last year of unlawful possession and use of a chemical weapon and providing false information to the FBI.
According to evidence presented at trial, federal agents executed a search warrant at Fries’ home in Tucson on May 13, 2011, in connection with the investigation related to the chemical weapon charges. Agents discovered 24 explosive devices, three containing added fragmentation, in a bedroom in the Fries residence. The chemical weapon charges stemmed from an incident that occurred on Aug. 2, 2009, when a chlorine chemical device was placed at the home of Fries’ former clients with whom he had a billing dispute. In that incident, the chlorine device produced a huge chlorine containing cloud that enveloped a neighborhood on the northwest side of Tucson and resulted in the evacuation of the neighborhood.
A conviction for unlawful possession of unregistered devices carries a maximum penalty of ten years in prison and not more than a $10,000 fine or both.
The investigation was conducted by the Federal Bureau of Investigation and the Pima County Sheriff’s Department. The prosecution was handled by Beverly K. Anderson, Assistant U.S. Attorney, District of Arizona, Tucson.
CASE NUMBER: CR-11-1751-TUC-CKJ
RELEASE NUMBER: 2013-062_FriesFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
Former Newark Police Officer Sentenced to Three Months in Prison for Conspiracy to Commit Public Housing FraudRead the Press Release
NEWARK, N.J. – A former Newark police officer was sentenced today to three months in prison for conspiring with another person to fraudulently obtain payments under the federal public housing assistance program known as “Section 8,” U.S. Attorney Paul J. Fishman announced.
Suliaman Kamara, 32, of Newark, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to an information charging him with one count of agreeing with another individual to obtain Section 8 public housing benefits to which they were not entitled.
According to documents filed in this case and statements made in court:
The Section 8 Program is a federal public housing assistance program administered by the U.S. Department of Housing and Urban Development. It provides rent subsidies to qualified low-income individuals. HUD provided federal grant money to the Newark Housing Authority (NHA) for the Section 8 Program. Under the NHA’s Section 8 Program, a tenant’s rental assistance was based upon the tenant’s anticipated family gross income. Tenants receiving Section 8 assistance from the NHA had to inform the Newark Housing Authority of all the members of the household and the annual household income.
From September 2006 to December 2011, Kamara, then a Newark police officer, lived in Newark with another individual (identified in court papers as “S.L.”) who was receiving Section 8 benefits. For most of that time they lived in a property owned by Kamara. They agreed they would not disclose to the NHA that they were living together so that Kamara’s income would not be taken into account in determining whether S.L. qualified for Section 8 benefits. Kamara and S.L. submitted fraudulent information and documents to the NHA in which they failed to disclose that Kamara lived with S.L. and was earning household income. Kamara and S.L. obtained more than $60,000 in Section 8 benefits to which they were not entitled.
In addition to the prison term, Judge Wigenton sentenced Kamara to two years of supervised release.
U.S. Attorney Fishman credited special agents of the U.S. Department of Housing and Urban Development, under the direction of Special Agent in Charge Cary Rubenstein, for the investigation of this case.
The government is represented by Assistant U.S. Attorney Barbara R. Llanes of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
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Defense counsel: Anthony Iacullo Esq., Nutley, N.J.Former Jonesborough Police Officer Sentenced to Serve Eighteen Months in Prison for Steroid TraffickingRead the Press Release
GREENEVILLE, Tenn. – Freddie Matthew Sergent, 31, of Telford, Tenn., was sentenced on August 12, 2013, by the Honorable J. Ronnie Greer, U.S. District Court Judge, to serve 18 months in federal prison to be followed by three years of supervised release.
Sergent pleaded guilty in January 2013 to unlawfully distributing anabolic steroids from approximately 2009 to April 2012. Anabolic steroids are synthetically produced variants of the naturally occurring male hormone testosterone and are regulated under the Controlled Substances Act (CSA) as a Schedule III controlled substance. As a Schedule III controlled substance, they may not be possessed lawfully in the United States without a prescription.
Sergent obtained raw steroid powders and other materials through the U.S. mails from sources in China. He processed and packaged the steroids into vials containing approximately 300 milliliters of a solution containing an anabolic steroid, to include the Schedule III anabolic steroid boldenone undecylenate, often referred to by the trade name “Equipoise.” Sergent sold the steroids to customers in eastern Tennessee as well as customers across the United States.
During the execution of a federal search warrant at Sergent’s residence in April 2012, agents recovered steroid powders, materials used to process and package steroids, syringes, computers used to order and sell steroids over the Internet, and three firearms. He admitted that he had been ordering steroid powder from China, processing and packaging the steroids, and selling the steroids to customers throughout the United States, the steroids being sent through the U.S. mail. Sergent said he had sold approximately $80,000 worth of steroids at $40 per vial.
For almost the entire time Sergent was unlawfully trafficking in steroids, he was employed as a police officer with the Jonesborough, Tennessee Police Department. He resigned from the Jonesborough Police Department in January 2012.
Agencies involved in this investigation included the Drug Enforcement Administration, U.S. Postal Inspection Service, and Homeland Security Investigations. Assistant U.S. Attorney Neil Smith represented the United States.
Former Ashland Police Officer Sentenced to 75 Months for Attempting to Illegally Obtain Prescription Drugs and for Firearm OffenseRead the Press Release
ASHLAND, KY - Melvin Charles Schoch, Jr., 30, was sentenced today to 75 months in federal prison for attempting to possess with intent to distribute Oxycodone and using a firearm during a drug offense.
Schoch previously admitted that, in May or June of 2009, while working as an Ashland Police Officer, he and two other individuals invaded a residence in Boyd County. They conducted the home invasion, under the guise of executing a search warrant, in order to obtain Oxycodone pills and/or money for their own personal benefit.
Prior to entering the residence, Schoch provided the others with police tactical equipment to help with the home invasion. Schoch entered the home armed with his duty weapon, a .40 caliber Glock pistol, and placed the two male occupants of the residence in handcuffs. However, Schoch didn’t locate any pills at the residence.
According to the plea agreement, before to the home invasion, Schoch and the others observed activity around the residence and believed there were large quantities of Oxycodone and cash at the residence.
Schoch’s co-defendant, Ellis Pittman, previously pleaded guilty to similar charges and is scheduled for sentencing in September.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, Robert L. Corso, Special Agent in Charge, DEA; Rodney Brewer, Kentucky State Police Commissioner and Jack Conway. Kentucky Attorney General jointly made the announcement today.
The investigation was conducted by the DEA, Kentucky State Police, Kentucky Attorney General’s Office and the Morehead Police Department. Assistant U.S. Attorney Ron L. Walker represented the U.S. Attorney’s Office in this case.
Under federal law, Schoch must serve at least 85 percent of his prison sentence.
Felon Sentenced to Prison for Illegally Possessing GunRead the Press Release
ERIE, Pa. - A resident of Erie, Pennsylvania, has been sentenced in federal court to 21 months in jail on his conviction of violating federal firearms laws, United States Attorney David J. Hickton announced today. The sentence was ordered to be served consecutively to any sentence imposed after his revocation of probation in the Court of Common Pleas of Erie County.
Senior United States District Judge Maurice B. Cohill, Jr. imposed the sentence on Damon Duane Amison, 21.
According to information presented to the court, Amison possessed a loaded Ruger P89 9mm handgun while being a convicted felon. The firearm was located by the Erie Police when they executed a search warrant of a residence on June 13, 2012. The evidence disclosed that the weapon had been stolen from a residence in Harborcreek Township, Pennsylvania.
Assistant United States Attorney Marshall J. Piccinini prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Erie Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives for the investigation leading to the successful prosecution of Amison.
Felon Pleads Guilty to Possession of AmmunitionRead the Press Release
Colby Palmer, age 26, from Clinton, Iowa, pled guilty today in federal court in Cedar Rapids to being a prohibited person in possession of ammunition.
In a plea agreement, Palmer admitted that, on June 6, 2012, law enforcement officers conducted a consent search of a home located in Cedar Rapids, Iowa, where Palmer was staying. Palmer had slept the night before the search in the master bedroom. In the room was a bag belonging to him. In the bag was a box of Winchester .357 magnum caliber ammunition. Palmer admitted in the plea agreement he knew the ammunition was in his bag and knowingly possessed the ammunition. Law enforcement officers recovered a latent fingerprint from the box of ammunition that matched defendant’s known prints. Another box of .357 magnum caliber ammunition was found under the bed. Palmer also admitted to two prior felony convictions. On March 21, 2007, Palmer was convicted in the Iowa District Court for Polk County of Burglary in the 3rd Degree, and on June 2, 2009, Palmer was convicted in the Iowa District Court for Webster County of Interference with the Official Acts of a Correctional Officer Inflicting Bodily Injury.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Palmer remains in custody of the United States Marshal pending sentencing. Palmer faces a possible maximum sentence of ten years’ imprisonment, a $250,000 fine, a $100 special assessment, and three years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Cedar Rapids Police Department. This case was a result of the Cedar Rapids Safe Streets Task Force and was in furtherance of the Project Safe Neighborhoods initiative.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-0041-LRR.
Federal Jury Convicts James “Whitey” BulgerRead the Press Release
BOSTON – Following a two-month long trial, the jury convicted James J. Bulger, holding him responsible for the murder of 11 people, as well as numerous counts of extortion, money laundering, drug dealing, and firearms possession. Sentencing will begin on Nov. 13.
After deliberating for over 32 hours, over five days, the jury found the former fugitive guilty of racketeering conspiracy and numerous racketeering acts of murder, extortion, narcotics distribution, money laundering and possession of firearms including machineguns. With this verdict, the jury has found that Bulger played a role in the murders of Deborah Hussey, Paul McGonagle, Edward Connors, Thomas King, Richard Castucci, Roger Wheeler, Brian Halloran, Michael Donahue, John Callahan, Arthur Barrett and John McIntyre.
Bulger, the former leader of the Winter Hill Gang, ran a vast criminal network that emanated from South Boston and controlled much of the city and the surrounding areas during the 1970s and 1980s. In order to generate money and maintain dominance among other criminal enterprises, Bulger and his associates engaged in numerous illegal activities such as loansharking, extortion of local business owners and bookmakers, trafficking of narcotics and firearms, and murder. Bulger, and associates under his direction, used violence, threats, and intimidation to carry out these illegal activities.
In late 1994, upon learning of his impending indictment, Bulger fled Massachusetts. On June 22, 2011, Bulger and his companion, Catherine Greig, were arrested in Santa Monica, California after 16 years on the run. Greig was later convicted of conspiracy to harbor a fugitive and is currently serving eight years in federal prison.
U.S. District Court Judge Denise J. Casper scheduled sentencing for November 13. He faces a maximum of up to life, plus 30 years in prison.
United States Attorney Carmen M. Ortiz; Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police; John J. Arvanitis, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Michael E. Horowitz, Inspector General for the Department of Justice; Vincent Lisi, Special Agent in Charge of the FBI’s Boston Field Division, and U.S. Marshal John Gibbons made the announcement today.
The case was prosecuted by Assistant U.S. Attorneys Fred M. Wyshak, Jr., Brian T. Kelly and Zachary Hafer of Ortiz’s Public Corruption and Special Prosecutions Unit.
Erie Man Sentenced to Thiry Years in Jail for Child Exploitation OffensesRead the Press Release
ERIE, Pa. - A resident of Erie, Pennsylvania, has been sentenced in federal court to 30 years in prison and lifetime supervised release on his conviction of violating federal firearms laws and laws relating to the sexual exploitation of children, United States Attorney David J. Hickton announced today.
Senior United States District Judge Maurice B. Cohill, Jr. imposed the sentence on Douglas E. Melter, 32.
According to information presented to the court, Melter attempted to induce a woman to procure an eleven year old female for Melter to sexually abuse and photograph naked. Melter offered to pay $1 ,200 for one hour alone with the girl at his home. Melter also possessed computer images depicting minors engaging in sexually explicit conduct and possessed a firearm after having been convicted of multiple felonies.
Prior to imposing sentence, Judge Cohill noted Melter's extensive criminal history and the very troubling aspects of Melter's conduct in the case.
Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Pennsylvania State Police and the Erie Police Department for the investigation leading to the successful prosecution of Melter.
Launched in February 2006, Project Safe Childhood is 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 via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Couple Charged with Harboring Aliens Through Waterloo BusinessRead the Press Release
Yu Jiang, age 30, and Christy Wen Zu, age 28, from Waterloo, Iowa, have been charged with one count of conspiracy to transport, harbor and encourage illegal aliens to reside in the United States. The charge is contained in an Information filed today in United States District Court in Cedar Rapids.
The Information alleges that during 2011 and 2012, Jiang and Zu, doing business as the Hibachi Sushi Buffet restaurant, knowingly employed undocumented foreign nationals to work at the restaurant. The workers were provided housing by the restaurant and were transported on a daily basis to and from an apartment. The workers were provided meals at the restaurant at no charge and were paid in cash for their services.
If convicted, Jiang and Zu each face a possible maximum sentence of 10 years’ imprisonment, a $250,000 fine, $100 in special assessments, and up to three years of supervised release following any imprisonment.
Jiang and Zu’s first appearance in federal court in Cedar Rapids for an arraignment and plea hearing is set for August 27, 2013.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
The case is being prosecuted by Assistant United States Attorney Richard L. Murphy and was investigated by Department of Homeland Security Investigations.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-CR-02017.
Connecticut Landlords Ordered to Pay More Than $100k for Discriminating Against Prospective TenantsRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, and Bryan Greene, Acting Assistant Secretary of Fair Housing and Equal Opportunity for the U.S. Department of Housing and Urban Development, today announced that a federal judge in New Haven has found the owners of a property in Windsor Locks, Conn., liable for violating the Fair Housing Act by discriminating against prospective tenants based on their race.
In October 2011, the United States brought an action against Merline Hylton, the owner of 5 Townline Road in Windsor Locks, her husband Clifton Hylton and Hylton Real Estate Management (HREM), after the Connecticut Fair Housing Center filed a complaint with the U.S. Department of Housing and Urban Development on behalf of alleged victims of discrimination. In March 2013, U.S. District Judge Janet C. Hall presided over a bench trial in the matter.
On May 1, 2013, Judge Hall issued a ruling that found that the defendants had violated the Fair Housing Act by refusing to rent to tenants based on their race; discriminating in the terms, conditions, or privileges of renting to prospective tenants based on their race; and making discriminatory statements based on race regarding the rental of their property. Merline Hylton was ordered to pay compensatory damages for the actions of her husband and HREM, and Clifton Hylton and HREM were ordered to pay compensatory and punitive damages to the victims totaling $76,091.05. Judge Hall found that Clifton Hylton acted with evil motive and showed no remorse for his conduct, justifying an award of punitive damages.
On July 26, 2013, Judge Hall also ordered the defendants to pay attorneys’ fees in the amount of $37,422 to the Connecticut Fair Housing Center, who represented the victims and tried the case with the United States.
“Discrimination in housing in Connecticut will not be tolerated and those who discriminate will be aggressively pursued,” stated Acting U.S. Attorney Daly. “We will not hesitate to take enforcement action where a person’s federal rights are denied.”
“Racial discrimination in housing not only violates the law and our commonly-held moral precepts as Americans, it also causes great economic and social harm to the family denied the opportunity to live in the neighborhood of their choice,” stated HUD Acting Assistant Secretary Greene. “HUD and the Department of Justice will continue to enforce the fair housing laws to ensure that everyone with the wherewithal to pay has equal access to America's neighborhoods.”
In addition to awarding monetary damages, Judge Hall ordered that the defendants complete three hours of fair housing training each year, post signs on their dwellings indicating that their dwellings are available on a non-discriminatory basis, and report to the government any complaints alleging discrimination filed by their tenants.
This case was prosecuted by Assistant United States Attorney Ndidi N. Moses and Timothy Bennett-Smyth from the Connecticut Fair Housing Center.
The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability, and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
Individuals who believe that they may have been victims of housing discrimination can file a complaint with the U.S. Attorney’s Office at 203-821-3700, call the Housing Discrimination Tip Line at 1-800-896-7743, email the Justice Department at [email protected], or contact HUD at 1-800-669-9777.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Clackamas Man Convicted of Presenting Two False Claims Against the United StatesRead the Press Release
PORTLAND, Ore. – A jury in federal court in Portland convicted Miles Julison, 40, of two counts of filing false claims against the United States. The defendant, a resident of Clackamas and a former real estate investor, was found guilty on August 9th, 2013, after he filed tax returns for the years 2007 and 2008 falsely claiming total refunds due in the amount of more than $1.9 million, despite having paid no federal income taxes in those years. Sentencing in the case is scheduled for November 20, 2013, before U.S. District Judge Michael H. Simon.
“Both collecting revenue to fund the essential functions of the federal government and promptly refunding overpayments by individual taxpayers depends on all taxpayers’ good-faith compliance with the tax laws,” said U.S. Attorney Amanda Marshall. “The administration of the Internal Revenue Code rests on the proposition that every taxpayer will pay the taxes he or she owes, without having to be audited by the IRS. This office and the IRS will continue to ensure that those taxpayers who do not do so will face the consequences established by law.”
After a five-day trial and three hours of deliberations, the jury found Miles Julison guilty of filing two false claims for income tax refunds to which he was not entitled. The evidence at trial established that, in July 2008, Julison falsely claimed on his tax return that he had earned more than half a million dollars in 2007 and that almost all of it had been withheld for taxes. He then fraudulently claimed he was due a tax refund of $411,773.00. The IRS issued him a check for that amount two weeks later. In January 2009, Julison falsely claimed on his tax return that he had earned more than $2.3 million in 2008, and that all but $815 of that total had been withheld for taxes. He fraudulently claimed a tax refund of more than $1.5 million. By then, however, Julison was already under criminal investigation, and the refund was never issued.
The evidence at trial established that Julison used the refund he obtained to purchase, among other things, a $60,000 Mercedes-Benz sedan, to pay off his mortgage, and to make payments on a 23-foot ski boat, a Toyota Sequoia SUV, two Kawasaki wave runners, and two Polaris snowmobiles. The trial featured testimony from two other criminal defendants who had collaborated with Julison in filing similar claims for fraudulent refunds. Those men were expected to plead guilty to charges of filing false claims against the United States in cases pending elsewhere.
This case was investigated by IRS, Criminal Investigation. Assistant U.S. Attorneys Seth D. Uram and Ryan W. Bounds prosecuted the case.
Central African Republic National Sentenced for Resisting Deportation OrdersRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced today that Seyba Diallo, 46, of the Central African Republic, was sentenced by U.S. District Judge Dee D. Drell to one year in prison for two counts of impeding or hampering his deportation, and he was also sentenced to one year of supervised release for each count. He will serve the terms concurrently.
On March 12, 2013, after a two-day trial, a jury found Diallo guilty on two counts of impeding or hampering his deportation from the United States. Based on witness testimony and documents admitted into evidence, it was established that on Nov. 11, 2011 and March 13, 2012, Diallo physically resisted U.S. Immigration Enforcement Agents when they attempted to put him on a commercial flight in Alexandria to return him to his country of origin. On both dates, agents brought him to the Alexandria International Airport and attempted to put him on a commercial flight where he began to yell and physically resist officers, which prevented him from being allowed on the flight because of airline and Transportation Security Administration policies. Diallo’s actions at the airport delayed his removal, but they also led to his travel documents issued by the Central African Republic expiring, which further delayed his removal until new travel documents could be obtained. Diallo has been in the United States for more than nine years.The Immigration and Customs Enforcement - Enforcement and Removal Operations conducted the investigation. Assistant U.S. Attorney Joseph T. Mickel prosecuted the case.
Canadian Nexus Pass Holder Charged with Possessing AR-15 Rifle and False StatementRead the Press Release
BUFFALO, N.Y.---U.S. Attorney William J. Hochul, Jr. announced that David B. Patel, 39, of Niagara Falls, Ontario, was arrested in Niagara Falls, New York, and has been charged with unlawful possession of a firearm by an alien and with making a materially false statement to a U.S. Customs and Border Protection officer. The firearm possession charge carries a maximum sentence of 10 years in prison and a $250,000 fine. The false statement charge carries a maximum sentence of 5 years in prison and a $250,000 fine.
Assistant U.S. Attorney Frank T. Pimentel, who is handling the case, stated that on July 24, 2013, Patel ordered an AR-15 upper receiver over the Internet from a firearms dealer in the United States. Patel requested that the dealer ship the item to a postal address in Niagara Falls, New York. Then, on August 10, Patel – a NEXUS pass holder – entered the United States at the Whirlpool Bridge Port of Entry in Niagara Falls, New York, and told a Customs and Border Protection officer that he was entering the United States to shop at Wal-Mart and Sam’s Club. Instead, however, Patel went straight to the postal address in Niagara Falls, New York, and retrieved the package containing the AR-15 upper receiver. He was immediately arrested.
Patel made his initial appearance today in U.S. District Court, before the Honorable Hugh B. Scott, and was released on a $5,000 cash bond. His next court date is scheduled for August 30, 2013 also before Magistrate Judge Scott.
The criminal complaint is the result of an investigation on the part of the United States Homeland Security Investigations under the direction of Special Agent in Charge James Spero.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Boise Man Sentenced to 46 Months for Unlawfully Possessing and Transferring A FirearmRead the Press Release
BOISE – Ronald Keith Alexander, 38, of Boise, Idaho, was sentenced today in United States District Court to 46 months in prison followed by three years of supervised release for unlawfully possessing a firearm and transferring a firearm in violation of the National Firearm Registration and Transfer Record, U.S. Attorney Wendy J. Olson announced. Alexander pleaded guilty to the two counts on May 2, 2013.
According to court documents, in December 2012, Alexander offered to sell a rifle to a Nampa Police detective working undercover. After discussing the terms, Alexander told the officer that an automatic rifle would cost $3,200. Arrangements were made for the officer to purchase the firearm during a controlled operation. On December 18, 2012, the undercover officer met with Alexander and his co-defendant, Phillip Bernardino Chavez. Chavez presented the undercover officer with a Pioneer Arms Corporation 7.62x25 rifle and a bag containing three magazines, in exchange for $3,200. At the conclusion of the transaction, law enforcement agents arrested Alexander and Chavez. Alexander is prohibited from possessing firearms due to a prior conviction for robbery in Walla Walla County, Washington, a felony punishable by a term of imprisonment exceeding one year. Alexander admitted that on December 4, 2012, he knowingly possessed a Federal Arms Corporation .308 rifle and a Century Arms 7.62x39 millimeter rifle. He also admitted to unlawfully transferring a Pioneer Arms Corporation 7.62x25 rifle – a machinegun with a shortened barrel – knowing the firearm was not registered to him in the National Firearm Registration and Transfer Record.
Phillip Chavez, 29, of Las Vegas, Nevada, pleaded guilty on July 11, 2013, to illegal possession of a machine gun. He is set for sentencing on September 23, 2013, before U.S. District Judge Edward J. Lodge.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Nampa Police Department, and the Boise Police Department.
The defendants are being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Belmont Man Charged with Insider TradingRead the Press Release
BOSTON - A Belmont resident was charged today in federal court with securities fraud, for trading on material non-public information regarding his employer.
Jospeh M. Tocci, 59, was charged in an Information with one count of fraud in connection with the offer, purchase or sale of a security. The charge arises from Tocci’s purchase of “putTocci Joseph PR” options for stock of the company where he worked, after he learned of bad news that had not yet been publicly announced.
The Information alleges that Tocci was an assistant treasurer at Devens-based American Superconductor Corporation (AMSC), a producer of components for the wind power industry. On March 31, 2011, Tocci learned from AMSC’s chief financial officer that there was a serious problem with AMSC’s largest customer, a Chinese company that was refusing new shipments and was refusing to pay for prior AMSC shipments. On April 1, 2011, Tocci purchased approximately $12,652 worth of “put” options on AMSC stock, notwithstanding a corporate blackout period that barred designated employees, including Tocci,from trading in AMSC stock. Those “put” options positioned Tocci to make money if the company’s stock price fell significantly before May 21, 2011. After the close of trading on April 5, 2011, AMSC publicly announced its anticipated financial results for the preceding year and quarter, and also announced the news regarding its largest customer. The following day, AMSC’s stock price dropped sharply. Over the next few days, Tocci sold his options for a net profit of approximately $82,440.
Tocci is expected to plead guilty to the charge pursuant to a plea agreement that, if accepted by the court, provides for a probationary sentence.
United States Attorney Carmen Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation – Boston Field Division made the announcement today. The case was investigated by the Federal Bureau of Investigation with assistance from the United States Securities and Exchange Commission. It is being prosecuted by Assistant U.S. Attorney Andrew E. Lelling of Ortiz’s Economic Crimes Unit.
The details contained in the Information are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
###AG Holder American Bar Association House of Delegates RemarksRead the Press Release
Remarks as Prepared for Delivery by Attorney General Eric H. Holder, Jr.
Annual Meeting of the American Bar Association’s House of Delegates
Monday, August 12, 2013
San Francisco, CaliforniaThank you, Bob Carlson, for those kind words – and for your exemplary service as Chair of the American Bar Association’s House of Delegates. It’s a pleasure to be with you this morning. And it’s a privilege to join so many friends, colleagues, and leaders – including U.S. Attorney for the Northern District of California Melinda Haag – here in San Francisco for the ABA’s 2013 Annual Meeting.
I’d like to thank your Delegates for all that they’ve done to bring us together this week – and for their dedication to serving as faithful stewards of the greatest legal system the world has ever known. From its earliest days, our Republic has been bound together by this system, and by the values that define it. These values – equality, opportunity, and justice under law – were first codified in the United States Constitution. And they were renewed and reclaimed – nearly a century later – by this organization’s earliest members.
With the founding of the ABA in 1878, America’s leading legal minds came together – for the first time – to revolutionize their profession. In the decades that followed, they created new standards for training and professional conduct. And they established the law as a clear and focused vocation at the heart of our country’s identity. (Read More )
Friday 9 August 2013
Yvonne Owens-Morris Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on August 8, 2013, before Chief U.S. District Judge Dana L. Christensen, YVONNE OWENS-MORRIS, a 48-year-old resident of Hungry Horse, was sentenced to a term of:
Prison: 8 months
Special Assessment: $100
Restitution: $82,587.82
Supervised Release: 3 years
OWENS-MORRIS was sentenced in connection with her guilty plea to theft of government money.
In an Offer of Proof filed by Assistant U.S. Attorney Chad C. Spraker, the government stated it would have proved at trial the following:
On May 8, 2008, OWENS-MORRIS applied for Supplemental Security Income (SSI) benefits in Kalispell. During the application, OWENS-MORRIS was asked whether she had sold, transferred title, disposed of or given away any money or other property in the past three years. OWENS-MORRIS was also asked about any income she received or expected to receive beginning April 2008.
According to her application, OWENS-MORRIS received $300 a month from her sister from April 2008 to May 2008 and $300 a month on a continuing basis from her parents. Aside from food stamps, two vehicles valued together at $4,500, and a bank account containing $100, OWENS-MORRIS indicated that she had no other financial resources. OWENS-MORRIS declared under penalty of perjury that the information she provided was true.
SSA conducted eligibility reviews with OWENS-MORRIS on September 21, 2009; October 26, 2009; and December 8, 2009. On each occasion OWENS-MORRIS reported owning assets valued at less than $9,000 and monthly income of $600 or less.
OWENS-MORRIS in fact owned assets and received income that made her ineligible to receive SSI. A year prior to applying for SSI, on May 11, 2007, OWENS-MORRIS deeded to her sister a property in Kalispell known as the Dumas Walker Cowboy Bar. Her sister later signed a power of attorney permitting OWENS-MORRIS to make real estate transactions concerning the property, and on January 14, 2008, OWENS-MORRIS, acting under the power of attorney, sold the property for $200,000. From January 2008 to June 2008, her sister sent OWENS-MORRIS approximately $87,000.
On March 22, 2008, OWENS-MORRIS fell and suffered a back injury on her mother-in-law's property. OWENS-MORRIS settled with her mother-in-law's home owner's insurance. On July 22, 2008, she received a $101,000 check.
From July 2008 to June 2009, OWENS-MORRIS held a UBS investment account. In July 2008, the account held a total of $2,666.
On October 18, 2008, OWENS-MORRIS's mother died. On April 16, 2009, OWENS-MORRIS, as her mother's court appointed representative, deeded a property in Refugio, Texas from her mother to herself and her father. County tax records value the property at $47,170.
In total OWENS-MORRIS received $24,622.04 in SSI benefits to which she was not entitled. Under an agreement between SSA and the State of Montana, whenever an applicant qualifies for SSI, that applicant is also eligible to receive Medicaid benefits. From April 2008 and continuing into 2011, Montana Medicaid paid out in excess of $40,000 in benefits to OWENS-MORRIS's medical providers to which OWENS-MORRIS was not entitled.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that OWENS-MORRIS will likely serve all of the time imposed by the court. In the federal system, OWENS-MORRIS does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Social Security Administration - Office of Inspector General.
William Forrest Paul Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on August 8, 2013, before Chief U.S. District Judge Dana L. Christensen, WILLIAM FORREST PAUL, a 29-year-old resident of Butte, was sentenced to a term of:
Prison: 120 months
Special Assessment: $100
Supervised Release: 5 years
PAUL was sentenced in connection with his guilty plea to conspiracy to distribute 500 or more grams of methamphetamine.
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:
Since November 2010, agents from Homeland Security Investigations and the Butte Silver Bow Law Enforcement Agency have been investigating the distribution of methamphetamine in and around Butte by PAUL and others, including Gary Sheffield, Julie White, Angella Parker, Michael Young, and Paul Tizio.
On January 5, 2011, based on information obtained during that investigation, law enforcement officers searched Sheffield's car and the Sheffield/White residence in Butte. From the house they seized baggies of meth, surveillance cameras, drug paraphernalia, and a Fed-Ex receipt with Parker's name on it. The officers found more meth in Sheffield's possession during a search of his person and his car outside a nearby casino.
Also on January 5, 2011, before the search of Sheffield and White's residence, Parker was stopped for a traffic violation and admitted to having just purchased an "8-ball" of meth from Sheffield. She also admitted that during the course of the conspiracy she had received packages of methamphetamine from Tizio in Arizona that were intended for Sheffield and had shipped money to Arizona as payment for the drugs.
Following the events of January 5, 2011, law enforcement officers conducted interviews of various witnesses and learned that Tizio was obtaining methamphetamine in Arizona and shipping or otherwise arranging for the transportation of the drugs to Butte. In order to pay for the meth, money was shipped back to Tizio in Arizona, delivered to him in person, or deposited into his bank account. PAUL's role in the conspiracy was two-fold. He assisted in the transportation of methamphetamine and money between Arizona and Butte, and he also distributed quantities of methamphetamine in and around Butte that he and Sheffield had received from Tizio in Arizona. Among the records that law enforcement obtained during the investigation was a FedEx airbill documenting PAUL's shipment of a package to Tizio on November 18, 2010.
Gary Sheffield, Julie White, Angella Parker, Michael Young, and Paul Tizio pled guilty to federal charges and have been sentenced.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that PAUL will likely serve all of the time imposed by the court. In the federal system, PAUL 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 Homeland Security Investigations, the Butte-Silver Bow Law Enforcement Agency and the Silver Bow County Sheriff's Office.
Whitehall Woman Receives Four-year Sentence for Using Stolen Identities to Commit Benefits FraudRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS – Audrey Costar, 46, of Whitehall, Ohio was sentenced in U.S. District Court to 48 months in prison for using 50 stolen identities to file for unemployment benefits in eight states over three years. She was also ordered to repay $78,674 she received illegally.
Carter M. Stewart, U.S. Attorney for the Southern District of Ohio, James Vanderberg, Special Agent-in-Charge of the U.S. Department of Labor Office of Labor Racketeering and Fraud Investigations, Mark Porter, Special Agent in Charge, U.S. Secret Service and Elias Papoulias, Resident Agent in Charge, Social Security Administration Office of Inspector General announced the sentence handed down today by Senior U.S. District Judge James L. Graham.
According to court documents, Costar used 50 stolen identities, including some she stole over the internet, to electronically file false unemployment insurance claims in Alaska, Arizona, Colorado, Minnesota, Montana, Ohio, Pennsylvania and Utah between February 2009 and December 2012.
Costar also used some of the identities to open bank accounts or cash value cards over the internet to which the unlawful unemployment benefits would be deposited. After the payments were made, Costar would withdraw the payments using an automated teller machine and used the money for her own benefit. Costar was able to defraud the UI system while residing in both Ohio and New York. She collected approximately $78,674 using the scheme.
Costar was also collecting Social Security benefits in her own name at the time. Earnings made through the identity theft scheme were not reported to the Social Security Administration.
Costar pleaded guilty on April 5, 2013 to two counts of theft of government funds and two counts of aggravated identity theft.
U.S. Attorney Stewart commended the investigation by U.S. Department of Labor Office of Inspector General, Secret Service agents and Social Security Administration inspectors general, and Financial Crimes Chief Brenda S. Shoemaker, who is representing the United States in this case.
###Wenatchee Man Sentenced to Ten Years in Federal Prison for Posessing A Modified FirearmRead the Press Release
Spokane - Michael C. Ormsby, United States Attorney for the Eastern District of Washington, announced that Juan Manuel Fernandez, age 33, of Wenatchee, Washington, was sentenced on August 8, 2013, after having previously pled guilty on March 21, 2013, to being a felon in possession of a firearm. Senior United States District Court Judge Wm. Fremming Nielsen sentenced Fernandez to a ten year term of imprisonment, to be followed by a three year term of court supervision after he is released from Federal prison. In addition, Fernandez was ordered to forfeit the firearm.
According to information disclosed during the court proceedings, in late July and early August 2012, a Columbia River Drug Task Force investigation revealed Fernandez was distributing methamphetamine in the Wenatchee area. On August 10, 2012, the Columbia River Drug Task Force executed a search warrant on Fernandez's Wenatchee residence and located a large quantity of methamphetamine as well as a Ruger Model 10-22 .22 caliber rifle. The rifle's barrel had been significantly modified to be easily concealed.
Michael C. Ormsby stated, "that this case is a perfect example of the cooperation and coordination between federal and local officials in efforts to combat violent crime in our region. Our colleagues in Wenatchee and Chelan County did a wonderful job on this case."
This investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Columbia River Drug Task Force, the Chelan County Sheriff's Office, the Wenatchee Police Department, and the Washington State Patrol. The case was prosecuted by Caitlin A. Baunsgard, Assistant United States Attorney for the Eastern District of Washington.
CR-12-00125-WFN
Week in Review – South BendRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
South Bend, Indiana —The United States Attorney’s Office announced the following activity in Federal Court:
PLEA:
Bryant Rios, 25, of South Bend, Indiana, pled guilty before Magistrate Judge Christopher A. Nuechterlein to the felony offense of possession of a firearm by a convicted felon. Magistrate Nuechterlein is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. Sentencing set for 11/13/2013. This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives .This case is being prosecuted by Assistant United States Attorney Donald Schmid.
Abdul Shabazz, 37, of South Bend, Indiana, pled guilty before Magistrate Judge Christopher A. Nuechterlein to the felony offense of unlawful transport of firearms. Magistrate Nuechterlein is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. Sentencing set for 11/13/2013. This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives .This case is being prosecuted by Assistant United States Attorney Donald Schmid.
Ruben Fernandez, 31, of Cassopolis, Michigan, pled guilty before Magistrate Judge Christopher A. Nuechterlein to the felony offense of participating in a conspiracy to distribute cocaine.Magistrate Nuechterlein is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by the Drug Enforcement Agency .Sentencing set for 10/31/2013. This case is being prosecuted by Assistant United States Attorney William Grimmer.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS:
Kristopher Brooks, 40, of Elkhart, Indiana was sentenced by District Judge Robert L. Miller Jr to 46 months imprisonment and 5 years of supervised release after pleading guilty to the felony offense of failing to register as a sex offender.According to documents filed in this case, in 1993, Brooks was convicted of assault with intent towards sexual penetration.As a convicted sex offender, Brooks is required to register with local law enforcement when he relocates.After moving to Indiana, Brooks failed to register. This case was the result of an investigation by the US Marshals Service. This case was prosecuted by Assistant United States Attorney John Maciejczyk.
James Braun, 68, of South Bend, Indiana, was sentenced by District Judge Jon DeGuilio to 63 months imprisonment and 10 years of supervised release after pleading guilty to the felony offense of possession of child pornography. According to documents filed by the government in this case, Braun admitted that he possessed a computer which contained approximately 81 digital images and 8 videos that depicted minors that had not yet reached 12 years of age engaged in sexually explicit conduct.This case was the result of an investigation by the Federal Bureau of Investigation and the Indiana State Police.This case was prosecuted by Assistant United States Attorney John Maciejczyk.
Dale Hite, 27, of Plymouth, Indiana was sentenced by District Judge Jon E. DeGuilio to 292 months imprisonment (to run concurrently with the defendant’s state sentence) and 4 years of supervised release after pleading guilty to the felony offense of conspiring to manufacture over 50 grams of a mixture or substance that contained methamphetamine.According to documents filed in this case, during the course of ten months in 2010, Hite manufactured methamphetamine for sale. This case was the result of an investigation by the Drug Enforcement Agency.This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Jacqueline Rodriguez, 48, of Rochester, Indiana was sentenced by District Judge Jon E. DeGuilio to 2 years supervised probation and 4 months of home detention (location monitoring) and $13,490 restitution after pleading guilty to the felony offense of wire fraud.According to documents filed in this case, the defendant’s husband was previously unemployed and receiving assistance. After her husband found employment, Rodriguez continued to file vouchers for unemployment benefits.The defendant claimed that she committed this offense without her husband’s knowledge.This case was the result of an investigation by the Department of Labor.This case was prosecuted by Assistant United States Attorney Barbara Brook.
Week in Review – HammondRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
Hammond, Indiana - The United States Attorney’s Office announced the following activity in Federal Court:
PLEAS:
Anthony Cerrillos, 45, and Brian Cerrillos, 50, of Chicago, Illinois, pled guilty before Senior District Judge James Moody to the felony offense of conspiracy to transport in interstate commerce stolen goods that had a value in excess of $5,000.00.These charges were filed as a result of an investigation by the Federal Bureau of Investigation and the Hammond Police Department.This case is being prosecuted by Assistant United States Attorney Diane Berkowitz.
Jeffery Williams, 30, of Gary, Indiana, pled guilty before Chief Judge Philip Simon to the felony offense of distribution of heroin.This charge was filed as a result of an investigation by the Drug Enforcement Administration and the Lake Station Police Department.This case is being prosecuted by Assistant United States Attorney Thomas McGrath.
Yohinnest Herrod, 23, of Gary, Indiana, pled guilty before Chief Judge Philip Simon to the felony offense of making false statements in the acquisition of a firearm.This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives HIDTA Task Force.This case is being prosecuted by Assistant United States Attorney Nicholas Padilla.
George James Black, 53, of Gary, Indiana, pled guilty before Senior District Judge Rudy Lozano to the felony offense of possession of a stolen firearm.Sentencing has been set for 11/14/13.This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives HIDTA Task Force and the Indiana State Police.This case is being prosecuted by Assistant United States Attorney Nicholas Padilla.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS:
Keon Thomas, 38, of Hammond, Indiana, was sentenced by Senior District Judge James Moody to life imprisonment and $11,275.97 in restitution after being found guilty at trial of the felony offenses of conspiracy to commit robbery and murder, robbery, murder by means of a firearm during a robbery and 2 counts of possession of a firearm by a convicted felon (robbery).Thomas, along with defendant Styles Taylor and two others, was charged with the robbery and murder of Hammond businessman Frank Freund in April of 2000.Freund had owned and operated the Firearms Unlimited Gun Shop in Hammond for several years.Freund, who was 73 years old at the time, was shot twice at close range with a pistol while alone in his shop.This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Hammond Police Department.This case was prosecuted by Assistant United States Attorneys Philip Benson and David Nozick.
Sisto Bernal, 47, of Chicago, Illinois, and Santiago Gudino, 29, of Hammond, Indiana, defendants in the case US v Vargas et al., were sentenced Thursday by Senior District Judge Rudy Lozano after both pled guilty to conspiracy to participate in racketeering activity and conspiracy to possess with intent to distribute and distribute 5 kilograms or more of cocaine and 1000 kilograms or more of marijuana.Bernal was sentenced to 288 months imprisonment and 5 years of supervised release. Gudino was sentenced to 262 months imprisonment and 5 years of supervised release. According to the indictment, Bernal and Gudino are members of the Latin Kings, which is a nationwide gang that originated in Chicago and has branched out throughout the United States, including to Texas. The indictments also alleged that the Latin Kings gang was responsible for at least 20 murders in the Chicago/Northwest Indiana area and Big Spring, Texas. These charges were filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Drug Enforcement Administration; Federal Bureau of Investigation; the U.S. Immigration and Custom Office of Homeland Security Investigations; the National Gang Targeting, Enforcement & Coordination Center; the National Gang Intelligence Center; the Chicago Police Department; the East Chicago Police Department; the Griffith Police Department; the Hammond Police Department; the Highland Police Department; and the Houston Police Department.The investigation of the Chicago Police Department officers was conducted by Chicago City Public Corruption Task Force, a Chicago Police Department- Internal Affairs and FBI - Chicago law enforcement initiative.This case was prosecuted by Assistant United States Attorney David J. Nozick, and Joseph A. Cooley, Trial Attorney, United States Department of Justice - Organized Crime and Gang Section.
Jose Gonzalez, 31, of Chicago, Illinois, was sentenced by District Judge Joseph Van Bokkelen to 18 months imprisonment and 4 years of supervised release after pleading guilty to the felony offense of possession with intent to distribute 500 grams or more of cocaine.According to documents filed in this case, law enforcement was conducting surveillance in Merrillville, Indiana on a subject connected to a drug trafficking operation when they observed him meet with Gonzalez.The subject handed a white bag to Gonzalez, who then drove away.Officers followed Gonzalez until they could conduct a traffic stop.Officers found the bag which contained approximately 2.3 kilograms of cocaine.This case was the result of an investigation by the Drug Enforcement Administration.This case was prosecuted by Assistant United States Attorney Joshua Kolar.
Phyllis Lark, 46, of Hammond, Indiana, doing business as Absolute Care, was sentenced by District Judge Joseph Van Bokkelen to 37 months imprisonment, $1,863,585.92 in restitution to the Indiana Medicaid program and 3 years of supervised release after pleading guilty to the felony offense of submitting fraudulent claims to Indiana Medicaid.According to documents filed in this case, Absolute Care was a targeted case management service dedicated to severely disabled Medicaid recipients.An investigation revealed that Lark and others billed Medicaid for services to over 60 of its recipients when in fact the recipients had never heard of Lark or her company and had not received any of the billed services. This case was the result of an investigation by the Federal Bureau of Investigation and the Indiana Attorney General’s Medicaid Fraud Control Unit.This case was prosecuted by Assistant United States Attorney Diane Berkowitz.
Joniette Davis, 29, of Indianapolis, Indiana, Amber Fields, 24, of Milwaukee, Wisconsin and Lauren Price, 23, of Chesterton, Indiana, defendants in the case US v Harris et al., were sentenced by Chief Judge Philip Simon.Davis was sentenced to 1 day imprisonment (time served) and 2 years of supervised release after pleading guilty to the felony offense of conspiracy and attempt to commit fraud with identification documents.Fields and Price were sentenced to 1 day imprisonment (time served) and 3 years of supervised release after both pled guilty to conspiracy and attempt to commit fraud with identification documents and fraud with identification documents.According to documents filed in this case, the defendants obtained the account and personal information of individuals in over 21 states and fraudulently added their names to the victims’ accounts in an account takeover scheme. The defendants either utilized their own names or utilized aliases with the accounts which had been taken over. They purchased gift cards, Postal money orders, and made numerous retail purchases with the fraudulently obtained credit cards throughout Indiana, Illinois, Wisconsin, and Georgia. They also made cash withdrawals on the accounts and utilized the convenience checks associated with the accounts at various financial institutions located in Indiana, Illinois, Wisconsin, and Georgia. Throughout the criminal conduct, the defendants would also mail gift cards, Postal money orders, and U.S. currency from Indiana and Wisconsin to Georgia. This case was the result of an investigation by the United States Postal Service-Office of the Inspector General.This case was prosecuted by Assistant United States Attorney Toi Houston.
Week in Review – Fort WayneRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
Fort Wayne, Indiana —The United States Attorney’s Office announced the following activity in Federal Court:
PLEA:
Arturo DeLuna, 46, of Fort Wayne, Indiana, pled guilty before Magistrate Judge Roger B. Cosbey to the felony offense of conspiracy with intent to distribute cocaine.Magistrate Cosbey is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. This case resulted from an investigation by the Federal Bureau of Investigation.No sentencing date has been set.This case is being prosecuted by Assistant United States Attorney Lesley Miller-Lowery.
John Bennett, 35, of Sturgis, Michigan, pled guilty before Magistrate Judge Roger B. Cosbey to the felony offense of conspiracy to distribute and possession with intent to distribute methamphetamine and use of communications in conspiracy to distribute methamphetamine.Magistrate Cosbey is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. No sentencing date has been set.This case resulted from an investigation by the Federal Bureau of Investigation.This case is being prosecuted by Assistant United States Attorney Lesley Miller-Lowery.
Nicholas J. Zimmerman, 29, of Fort Wayne, Indiana pled guilty before Magistrate Judge Roger B. Cosbey to the felony offense of receiving stolen property of the United States.Magistrate Cosbey is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. This investigation was conducted by the United States Marine Corps. Sentencing has been set for 12/2/2013.This case is being prosecuted by Assistant United States Attorney Anthony Geller.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS:
Kenneth McCreary Jr., 26, of South Bend, Indiana was sentenced by District Judge Theresa L. Springmann to 2 years of probation and $733.06 in restitution after pleading guilty to the felony offense of theft or receipt of stolen mail matter.According to documents filed in this case, McCreary stole checks mailed to another individual.The defendant then used numerous checks for unauthorized purchases totaling over $700. This case was the result of an investigation by the United States Postal Investigation Services.This case was prosecuted by Assistant United States Attorney Lesley Miller-Lowery.
Scot Silvers, 47, of Angola, Indiana was sentenced by District Judge Theresa L. Springmann to 54 months imprisonment, 2 years of supervised release and $1,342.16 in restitution after pleading guilty to the felony offenses of production and trafficking in counterfeit device, fraud with identification documents, and uttering counterfeit obligations.Additionally, the United States was granted forfeiture of the electronic devices he used to commit these crimes.According to documents filed in this case, Silvers used a sophisticated arrangement of color printer and scanner technology in attempts to create counterfeit money.The paper currency was detected by department store employees who applied standard, anti-counterfeit procedures during check out of an accomplice. Silvers was later arrested while in the process of generating such items.This case was the result of an investigation by the United States Secret Service.This case was prosecuted by Assistant United States Attorney Tina Nommay.
Wasilla Ring Leader of drug conspicacy pleads guilty to drug charges in designer drug case which resulted in deathRead the Press Release
Anchorage, Alaska-U.S. Attorney Karen L. Loeffler announced today that the leader of a drug conspiracy involving seven South-central Alaska residents pled guilty in federal court. The six other co-conspirators have previously pled guilty to federal drug charges stemming from a conspiracy to possess and distribute methylone.
Methylone, a Schedule I controlled substance; a/k/a “Molly,” “M1”and “rolls,” is a synthetic drug similar to MDMA (a/k/a “ecstasy”) and is commonly imported from China via the internet for use in the U.S. particularly at clubs, parties and other social gatherings such as “raves.”
Robin Gattis, 20, of Wasilla, Alaska, pled guilty today in Anchorage to Count 1 of the Indictment, drug conspiracy, admitting that he imported approximately three kilograms of methylone between October 2011 and July 2012. In a plea agreement filed with the court, Gattis admitted that he was the leader and organizer of the conspiracy, that he directly imported the drugs from China, and that he repeatedly wired money to China or directed others to do so in order to pay for drugs. He also admitted that he engaged in drug dealing as a livelihood, that he knowingly used persons under age 18 to assist in the crime, that he distributed the drugs to persons under 18, and that he distributed methylone to MGS, who died of a methylone overdose in April 2012 in Anchorage. Chief U.S. District Court Judge Ralph R. Beistline scheduled Gattis’ sentencing for November 6, 2013. Gattis has been in federal custody since his arrest on July 31, 2012.
All of the defendants, Robin Gattis, Chad Cameron, 18, of Palmer, Alaska; Stephen Kimbrell, 20, of Soldotna, Alaska; Kevin Rupp, 21, of Anchorage, Alaska; Shane O’Hare, 23, of Wasilla, Alaska; Bren Marx, 20, of Palmer, Alaska; and Haylee Hays, 19, of Anchorage, Alaska, have pled guilty to charges stemming from their agreement to import methylone from China to Alaska and distribute it between September 2011 and July 2012. The seven defendants were indicted by a federal grand jury in December 2012.
In January 2013, Haylee Hays pled guilty to international money laundering as charged in Count 21 of the Indictment. Hays admitted that she wired money to China to pay for a methylone shipment in July 2012. Hays is scheduled for sentencing in January 2014.
In January 2013, Bren Marx pled guilty to Count 3 of the Indictment, admitting that he attempted to possess methylone in February 2012. Marx was living with Gattis and Rupp in Wasilla when U.S. Customs intercepted a package containing 22 grams of methylone that was being shipped from China to Gattis. Marx and Gattis were arrested after the package was delivered, and Marx was found to be in possession of additional methylone from a prior shipment. Marx was sentenced to five years of probation in April 2013.
Stephen Kimbrell pled guilty to two counts of the indictment in February 2013 and admitted that he attempted to possess 850 grams of methylone in July 2012. Gattis, Kimbrell, Hays, and others had wired money to China to pay for an 850 gram package of methylone. Kimbrell also pled guilty to international money laundering, admitting that he wired money to China to help pay for the drugs. He is scheduled for sentencing in August 2013.
Shane O’Hare pled guilty to possession of methylone with intent to distribute in February 2013, admitting that he repeatedly allowed Robin Gattis to ship drugs from China to O’Hare’s mailbox at the UPS Store in Wasilla. O’Hare admitted that he received multiple packages that he knew contained methylone, and delivered them to Gattis for further distribution. He is scheduled to be sentenced in January 2014.
Chad Cameron pled guilty in March 2013 to one count of attempted possession of a controlled substance. Cameron Admitted driving Gattis to Kenai on July 30, 2012, to pick up the package containing 850 grams of methylone that had been shipped to Stephen Kimbrell. The package had been intercepted by U.S. Customs, and Gattis, Cameron, and Kimbrell were arrested. Cameron also admitted wiring money to China at Gattis’ direction to pay for methylone on two occasions. On one of those occasions, Cameron was under 18 years of age. Cameron is scheduled for sentencing in August 2013.
Kevin Rupp pled guilty in March 2013 to one count, admitting that he knowingly possessed methylone with the intent to distribute. Rupp admitted that he drove Gattis to Wasilla in April 2012 to pick up a package containing methylone from O’Hare. He also admitted to transporting Gattis and the drugs back to Anchorage to the condo he shared with MGS. Rupp was also present in February 2012 when a package of methylone was delivered to the house he shared with Gattis and Marx in Wasilla. Rupp is scheduled for sentencing in August 2013.
According to the indictment, after MGS died in April 2012, Gattis emailed the supplier in China, advising them of MGS death and asked them for a refund. However, the indictment alleges that less than a month later, Gattis was ordering more methylone from the same supplier. A federal investigation began after the death of MGS in April 2012, and culminated when two more packages were intercepted in June and July 2012.
Gattis and the other defendants each face up to 20 years of imprisonment on the drug conspiracy, possession, and money laundering charges.
Ms. Loeffler commends Homeland Security Investigations, the Drug Enforcement Administration, the Anchorage Police Department, the United States Postal Inspection Service, and the Mat-Su Drug Unit for the investigation of this case.
Vice President of Motorcycle Gang Sentenced to Six Years in Prison for Firearms OffenseRead the Press Release
SAN FRANCISCO – Michael Warren of Santa Rosa was sentenced yesterday to six years in prison, United States Attorney Melinda Haag announced. According to information presented in court, Warren was the Vice President of the Barbarian Brotherhood gang, also known as BBH, a gang operating in Santa Rosa.
Warren, 39, of California, was indicted by a federal grand jury on July 10, 2012. He was charged in the Indictment with one count of being a felon in possession of a firearm, in violation of Title 18, United States Code, Section 922(g). Warren pleaded guilty to the offense on December 14, 2012.
The sentence was handed down by the Honorable Jeffrey S. White, U.S. District Court Judge. Judge White also sentenced the Warren to a three-year period of supervised release, the terms of which prohibit him from associating with other members of the Barbarian Brotherhood gang. Warren will begin serving his sentence on September 23, 2013.
Randy Luskey is the Assistant U.S. Attorney who prosecuted the case with the assistance of Daniel Charlier-Smith. The prosecution is the result of a joint investigation by the Federal Bureau of Investigation and the Santa Rosa Police Department.
Ute Mountain Ute Member Sentenced to Lengthy Prison Term for Assault with Intent to Commit Murder and Other Assault and Weapon ChargesRead the Press Release
DENVER – Ute Mountain Ute member Matthew Dewayne Jaramillo, age 30, of Towac, was sentenced earlier this week by U.S. District Court Judge Robert E. Blackburn to serve 660 months (55 years) in federal prison for assault with intent to commit murder and other assault and weapon charges, United States Attorney John Walsh and FBI Denver Special Agent in Charge Thomas Ravenelle announced. Following his prison sentence, Judge Blackburn ordered Jaramillo to spend 5 years on supervised release. Jaramillo appeared at the sentencing hearing in custody, and was remanded immediately after.
Jaramillo was indicted by a federal grand jury in Denver on April 30, 2012. The grand jury returned a superseding indictment on December 3, 2012. A jury trial was held by Judge Blackburn in Durango on May 13, 2013. At the conclusion of that trial, the jury found Jaramillo guilty of 1) assault with intent to commit murder; 2) assault with a dangerous weapon; 3) assault resulting in serious bodily injury; 4) felon in possession of a firearm; and 5) using a firearm during and in relation to a crime of violence. He was found not guilty of one count, and a second count was dismissed by the prosecution prior to trial. An additional count charged in the superseding indictment was determined to be a sentencing enhancement instead of an individual count.
On February 17, 2012, Jaramillo’s live in girlfriend purchased for him a .45 caliber handgun in Cortez, Colorado. The defendant had been previously convicted of a felony and was therefore a prohibited person, and unable to purchase the weapon for himself. Jaramillo wanted the firearm and went with her to pick it out. After the purchase the girlfriend provided Jaramillo with the firearm.
On March 6, 2012, the defendant and others were at a friend’s house on the Ute Mountain Ute Indian Reservation. All four people present were using methamphetamine. Jaramillo then started to become paranoid. He pulled out the .45 caliber firearm provided to him by his girlfriend, and began pointing it at two of the people at the house. He then began patting the two people down and asked them both “who was the snitch.” Thereafter, Jaramillo shot Wilson Ben Jones, Jr. in the center of his chest with the bullet passing through his sternum and damaging organs, muscle and tissue. The defendant then shot Jones again in the upper abdomen. Jones dropped to the living room floor. At some point, Jones tried to move and the defendant shot him again in the left hip. The victim would lay on the floor in a pool of his own blood for nearly two hours before the EMT’s arrived.
The evidence showed that Jones suffered numerous life threatening injuries which the treating surgeon described as fatal if left untreated. Jones also had to have hip replacement surgery.
On March 7, 2012, Jaramillo was spotted in Cortez, Colorado, and failed to obey police commands to surrender. Instead, he led police on a foot chase through downtown Cortez. He was apprehended after being tackled by an officer after a failed Taser attempt. Once apprehended, the police removed a fully loaded .45 caliber firearm from the defendant’s person along with an extra loaded magazine and 23 loose rounds of .45 caliber ammunition.
“The lengthy sentence handed down today is wholly just and necessary in light of the mindlessly violent crimes Jaramillo committed,” said U.S. Attorney John Walsh. “The 660 month sentence fits this defendant’s criminal conduct. He will remain in prison for decades in order to protect the community.”
“This sentence reflects the ongoing efforts of the BIA and FBI to aggressively investigate violent crime on our Nation’s Native American reservations and seek justice for the victims,” said Thomas P. Ravenelle, Special Agent in Charge of the FBI’s Denver Division Field Office.
This case was investigated by the FBI and the Bureau of Indian Affairs. The Cortez Police Department assisted with the arrest.
Jaramillo was prosecuted by Assistant U.S. Attorney James Candelaria, chief of the Durango branch office.
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Utah Cities Get Department of Justice Grants to Support Law Enforcement, CommunitiesRead the Press Release
Funding will Support Initiatives in Taylorsville, Layton, and South Salt Lake CitySALT LAKE CITY – The U.S. Department of Justice’s Office of Justice Programs has awarded Edward Bryne Memorial Justice Assistance Grants (JAG) to three Utah communities.
JAG funding allows states and local governments to support a broad range of activities to prevent crime based on their own state and local needs. Grant funds can be used for state and local initiatives, technical assistance, training, personnel, equipment, supplies, contractual support and information systems for criminal justice programs. The funds can be used in a variety of program areas, including law enforcement; prosecution and court programs; prevention and education; corrections; drug treatment and enforcement programs; planning, evaluation, and technology improvement programs; and crime victim and witness programs (other than compensation).
Taylorsville received a $33,782 grant, which will be used to purchase equipment and pay overtime in support of several law enforcement programs. The goal of Taylorsville’s effort is to increase pedestrian safety, improve security within the community, and improve the functionality of equipment patrol officers are relying on.
South Salt Lake City received a grant of $31,354, which will be used to help create a professional uniform work environment with updated technology and to increase efficiency for its law enforcement officers.
Layton received a $16,945 grant to help fund multi-media trial presentation equipment to be used in court.
United States Files Lawsuit Against PharMerica Corporation for Violations of the False Claims Act and the Controlled Substances ActRead the Press Release
The United States has filed suit against PharMerica Corp. in the U.S. District Court for the Eastern District of Wisconsin, the Justice Department announced today. The lawsuit alleges that PharMerica violated the False Claims Act and the Controlled Substances Act by dispensing controlled drugs without valid prescriptions and causing claims for illegally dispensed drugs to be submitted to the Medicare program.
PharMerica is a long-term care pharmacy that dispenses drugs to residents of long-term care facilities, including nursing homes and skilled nursing facilities. PharMerica services approximately 300,000 residents of long-term care facilities and fills approximately 40 million prescriptions annually. Many of the prescriptions filled by PharMerica are for controlled substances listed in Schedule II under the Controlled Substances Act. Schedule II drugs, such as oxycodone and fentanyl, can cause significant harm if used improperly and have a high potential for abuse.
“Pharmacies are prohibited by law from dispensing Schedule II narcotics, which have the highest potential for abuse of any prescription drug, without a valid prescription from a physician,” said Stuart Delery, Assistant Attorney General for the Civil Division of the Department of Justice. “As we have done today, the Department of Justice will take action to protect the integrity of Federal health care program funds and hold those who violate the law accountable.”
The government’s complaint alleges that PharMerica routinely dispensed Schedule II controlled drugs in non-emergency situations without first obtaining a written prescription from a treating physician. According to the complaint, PharMerica’s actions violated both the spirit and the letter of the Controlled Substances Act by enabling nursing home staff to order narcotics, and pharmacists to dispense narcotics, before confirming that a physician had made a medical judgment about whether these narcotics were necessary and should be used by the resident. The complaint alleges that PharMerica knowingly caused the submission of false claims to Medicare for these improperly dispensed Schedule II drugs, in violation of the False Claims Act.
The lawsuit was initiated by former PharMerica employee Jennifer Denk who filed a complaint against PharMerica in July 2009. The complaint was filed under the qui tam provisions of the False Claims Act, which permit parties, known as “relators,” to sue on behalf of the United States when they believe that defendants submitted false claims for government funds. Under the False Claims Act, the government may intervene in the suit and recover three times its damages plus civil penalties. Denk’s complaint was later consolidated with a subsequent complaint filed in May 2010 by Eric Beeders and Lesa Martino.
“ The complaint that we are filing today reflects the abiding commitment of the Justice Department to the qui tam process, encouraging people with information about alleged fraud and abuse to report it in a timely and effective manner,” said James L. Santelle, U.S. Attorney for the Eastern District of Wisconsin. “The False Claims Act allegations in this case, which involve Medicare billings for the dispensing of Schedule II controlled substances absent valid prescriptions, are precisely the type of allegations that our office and the Civil Division examine carefully, investigate fully, and prosecute vigorously—to protect taxpayer monies and to promote the delivery of professional health care to all of our constituents.”
The investigation was conducted by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Wisconsin, the Drug Enforcement Administration (DEA), and the Office of Inspector General of the Department of Health and Human Services.
"When the most restrictive class of pharmaceutical controlled substances are dispensed by a pharmacy it is crucial to patient safety, as well as mandatory by federal law, to ensure that the patient's physician prescribed and intended for the drug to be administered. As alleged in this complaint, PharMerica did not perform that standard of patient care by failing to obtain a valid prescription prior to dispensing and is now being held accountable," stated Jack Riley, Special Agent in Charge of the DEA’s Chicago Field Division.The government’s involvement in this case is part of the United States’ emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $14.8 billion through False Claims Act cases, with more than $10.8 billion of that amount recovered in cases involving fraud against federal health care programs.
The lawsuit is captioned U.S. ex rel. Denk v. PharMerica Corporation, Case No. 09-cv-720. The claims asserted in the complaint against PharMerica are allegations only, and there has been no determination of liability.
U.S. Attorney Timothy Purdon to Give Keynote Remarks at Fargo Moorhead Pride RallyRead the Press Release
FARGO – U.S. Attorney Timothy Purdon will join with the Fargo Moorhead Pride Collective and Community Center, friends, neighbors, and community members from Fargo and Moorhead on Sunday, August 11, 2013, at 2:00 p.m. at the Fargo Civic Center West Lawn (102 3rd Street North, Fargo) to participate in the Fargo Moorhead Pride 2013 Rally. The Rally follows the Pride Parade in downtown Fargo. U.S. Attorney Purdon will deliver the keynote speech at the Rally.
U.S. Attorney Purdon said, “Over the past year, great strides have been made on the road to LGBT equality in the United States, and the Department of Justice has been a part of that effort. Here in North Dakota, we have much work to do to on our journey to ensure equality, opportunity and justice for every North Dakotan, regardless of identity or orientation. At the North Dakota United States Attorney’s Office we stand ready to do our part to promote opportunity and access for every individual.”
Fargo Moorhead Pride 2013 is an annual event produced by the Fargo Moorhead Pride Collective and Community Center. The Center opened in October of 2000 with the purpose of creating a safe and inclusive space for LGBTs of the area. The Center’s mission is “to create a sense of community and promote education and social activities aimed at furthering the social and physical well-being and development of the LGBT community in the Red River Valley.” The Center is currently located at Townsite Center, 810 4th Avenue South, Suite 202, in Moorhead.Two Charged in Drug Smuggling Scheme Involving Philadelphia International AirportRead the Press Release
Jose Rodriguez, 25, of Sharon Hill , PA, and Edwin Fernandez, 35, of Philadelphia were charged in a six count Indictment, unsealed today, in a case involving an alleged drug trafficking organization, announced United States Attorney Zane David Memeger. The defendants are charged with conspiracy to import five kilograms or more of cocaine, importation of five kilograms or more of cocaine, attempted importation of five kilograms or more of cocaine, conspiracy to distribute five kilograms or more of cocaine, and two counts of attempted possession with the intent to distribute five kilograms or more of cocaine.
According to the indictment, between December, 2011 and July, 2012, Rodriguez and Fernandez, worked with a Santo Domingo, Dominican Republic drug trafficking organization (“Santo Domingo DTO”) to smuggle at least 71 kilograms of cocaine into the United States through the Philadelphia International Airport. Rodriguez, an employee of US Airways, recruited other US Airway employees, including Person #1, Person #2, and Person #3, to assist in the smuggling of bags which contained kilograms of cocaine.
The indictment further alleges that the Santo Domingo DTO employed several individuals, including airport employees in Santo Domingo, to ensure that bags filled with kilograms of cocaine were safely loaded aboard commercial airplanes destined for Philadelphia, PA. After the bags were safely loaded onto the plane in Santo Domingo, members of the Santo Domingo DTO alerted defendants Fernandez and Rodriguez who then notified the recruits to assist in the offloading of the bags at the Philadelphia Airport. Once the plane arrived in Philadelphia, the recruited US Airways employees would offload the baggage from the plane and divert the bags with the drugs onto domestic baggage claim belts, rather than the international baggage claim belts. This avoided inspection by United States Customs and Border Protection officials. Defendants Fernandez and Rodriguez then arranged for those bags to be retrieved from domestic baggage claim belts for distribution elsewhere.
According to the indictment, on January 7, 2012, United States Customs and Border Protection officials recovered three bags which contained approximately 50.81 kilograms of cocaine that had been offloaded from an incoming US Airways Flight from Santo Domingo, Dominican Republic to Philadelphia, PA. Additionally, on April 14, 2012, law enforcement officials in Santo Domingo, Dominican Republic, recovered a suitcase filled with approximately 20.84 kilograms of cocaine that was intended to be loaded onto a US Airways flight destined for Philadelphia, PA.
If convicted, each defendant faces a mandatory minimum sentence of 10 years in prison with a maximum possible sentence of life.
The case was investigated by Immigration and Customs Enforcement Homeland Security Investigations with assistance from U.S. Customs and Border Protection. It is being prosecuted by Assistant United States Attorneys Maureen McCartney and Kishan Nair.
Click here to view the indictment
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Three Queens Defendants Convicted of Committing Armed Robberies of Check Cashing StoresRead the Press Release
Following a two-week trial, a federal jury in Brooklyn, New York, today found Edward Byam, Derrick Dunkley, and Akeem Monsalvatge guilty of robbery conspiracy, two counts of robbery, and two counts of using a firearm in connection with those robberies.
The convictions were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York.
The government’s evidence at trial established that the defendants committed two armed robberies of separate Pay-O-Matic check cashing stores in Queens, New York. In 2010, the three defendants stole over $40,000 from a Pay-O-Matic after one of the defendants gained entry into the secure teller area through the roof. Wearing hooded sweatshirts and cloth masks over their faces, the defendants held the victim teller at gunpoint, handcuffed him, and beat him with a metal chair before making off with the stolen cash. In 2012, the defendants robbed yet another Pay-O-Matic check cashing store at gunpoint, this time wearing New York City Police Department jackets, badges, and life-like Hollywood-style special effects masks that concealed their identities and made them appear to be three white men. During this robbery, the defendants gained entry to the secure teller area by showing one of tellers a picture of her own home to indicate they knew where she lived and then forced the other teller on duty to open the locked doors to the teller area, where the defendants held the tellers at gunpoint and stole over $200,000 from the safe and teller drawers.
The government’s evidence included the testimony of the victim tellers who were held up at gunpoint during the 2010 and 2012 robberies, a manager at a different check cashing store who, the evidence showed, was a future intended victim of the defendants, as well as the owner of the company that manufactured the life-like special effects masks used by the defendants during the 2012 robbery. The government’s evidence also included telephone and cell site records placing the defendants at the scene of one of the crimes, DNA evidence, emails, and other documents showing the defendants’ purchases of the disguises used in the 2012 robbery and their purchases of tens of thousands of dollars of luxury items from high-end luxury boutiques.
“Those who would use violence and intimidation to make a quick buck should take this as a lesson: whatever tricks and deception they employ, they will be found and they will be prosecuted to the fullest extent of the law,” stated United States Attorney Lynch. Ms. Lynch expressed her grateful appreciation to the New York City Police Department’s Police Impersonation Unit and the New York Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the agencies responsible for leading the government’s investigation. Ms. Lynch also thanked the United States Marshals Service for their crucial assistance in apprehending these violent criminals.
When sentenced by United States District Judge Raymond J. Dearie, the defendants face a mandatory term of imprisonment between 32 years and life.
The government’s case is being prosecuted by Assistant United States Attorneys Maria Cruz Melendez, Una A. Dean, Tiana A. Demas, and Tyler J. Smith.
The Defendants
EDWARD BYAM, Age: 25
DERRICK DUNKLEY, Age: 25
AKEEM MONSALVATGE, Age: 38
Three Charged with Participating in Mortgage Fraud SchemeRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, today announced that a federal grand jury sitting in Hartford has returned an indictment charging three individuals with participating in a mortgage fraud scheme involving the purchase of more than 40 properties throughout Connecticut. The seven-count indictment, which was unsealed today, charges FILIPPOS MILIOS, also known as “Filip,” 54, of Newington, MALGORZATA KARAS-GOLKA, also known as “Margaret,” 45, of Newington, and CARMELINDA MAROTTA, also known as “Linda,” 44, of Manchester, with conspiracy and fraud offenses.
According to the indictment, from approximately June 2005 to at least November 2008, MILIOS, KARAS-GOLKA, MAROTTA and others conspired to commit mail and bank fraud by defrauding banks and mortgage lenders in obtaining dozens of mortgages for the sale of properties owned by MILIOS and KARAS-GOLKA. Some of the loans involved in the scheme were insured through the Federal Housing Administration (“FHA”).
The indictment alleges that the mortgage fraud conspiracy involved the use of straw borrowers, false mortgage applications, false HUD-1 forms, fraudulent down payments, and false verification forms in connection with the purchase of more than 40 houses in Hartford, New Haven and Middlesex counties. As part of the scheme, MILIOS, MAROTTA and others recruited or identified borrowers to purchase properties from MILIOS, KARAS-GOLKA and their co-conspirators. MILIOS is alleged to have made the down payments on behalf of the borrowers recruited to purchase the properties he and his co-conspirators were selling.
The indictment also alleges that MILIOS, KARAS-GOLKA and MAROTTA falsely represented to the lenders that a borrower intended to occupy a property as a primary residence. Part of the conspiracy involved borrowers submitting mortgage applications to purchase multiple properties as primary residences.
The indictment alleges that MILIOS paid money to borrowers, mortgage brokers, and recruiters, including MAROTTA, which was not disclosed to the mortgage lenders. MILIOS and MAROTTA also concealed from the lenders MAROTTA’s involvement in several fraudulent transactions and her receipt of a portion of the seller’s proceeds.
The indictment further alleges that MILIOS engaged in a money laundering conspiracy with Gabriel Serrano, a closing attorney. In the course of many of the fraudulent closings involving MILIOS’s sale to borrowers, Serrano received mortgage proceeds from banks and mortgage lenders. Serrano would frequently disburse some of those proceeds to private lenders who had loaned MILIOS money to purchase those properties.
MILIOS, KARAS-GOLKA and MAROTTA are charged with one count of conspiracy to commit mail and bank fraud, as well as separate counts of bank fraud. Each of these charges carries a maximum term of imprisonment of 30 years. MILIOS and KARAS-GOLKA are also charged with separate counts of mail fraud. Each of these charges carries a maximum term of imprisonment of 20 years.
The indictment also charges MILIOS with conspiracy to commit money laundering, a charge that carries a maximum term of imprisonment of 10 years, and KARAS-GOLKA with making a false statement to federal agents in March 2013, a charge that carries a maximum term of imprisonment of five years.
MILIOS was originally charged by criminal complaint in January 2013.
The three defendants appeared today before U.S. Magistrate Judge Thomas P. Smith in Hartford, pleaded not guilty to the charges and were released on bond.
On August 6, 2013, Serrano waived his right to indictment and pleaded guilty to one count of conspiracy to commit mail and bank fraud, and one count of conspiracy to commit money laundering. He awaits sentencing.
As to MILIOS, KARAS-GOLKA and MAROTTA, Acting U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General, the Internal Revenue Service – Criminal Investigation, the United States Postal Inspection Service and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorneys David T. Huang and Paul H. McConnell.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Sussex County, N.J., Man Admits Distributing Images of Child Sexual AbuseRead the Press Release
TRENTON, N.J. – A Sussex County, N.J., man today admitted using a computer in his home to distribute images of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Albert Rose, 55, of Hampton, N.J., pleaded guilty today before U.S. District Judge Joel A. Pisano in Trenton federal court to an information charging him with one count of distribution of child pornography.
According to documents filed in this case and statements made in court:
Rose admitted distributing images of child pornography via email using a computer located in his residence in February 2010. He also admitted to possessing more than 600 images of child pornography on his computer, which was seized from his residence in February 2012. Rose acknowledged that among the images of child pornography he possessed and distributed were images which depicted minors posing in a sexually explicit manner. Rose was previously charged by complaint with distribution of child pornography in September 2011and has been free on bail since his arrest.
The count to which Rose pleaded guilty is punishable by a mandatory minimum penalty of five years in prison and a maximum potential penalty of 20 years in prison, followed by a mandatory minimum of five years’ supervised release and a $250,000 fine. Sentencing is scheduled for Dec. 2, 2013.
U.S. Attorney Fishman credited special agents of the Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HIS), Newark Division, under the direction of Special Agent in Charge Andrew M. McLees, with the investigation leading to today’s guilty plea.The government is represented by Assistant U.S. Attorney Fabiana Pierre-Louis of the U.S. Attorney’s Office Criminal Division in Trenton.
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Defense counsel: S. Emile Lisboa Esq., Hackensack, N.J.
Rose Information
Suburban Man Sentenced to 12½ Years in Federal Prison for Transporting Child PornographyRead the Press Release
CHICAGO — A La Grange Park man who had amassed a collection of tens of thousands of images and videos of child pornography was sentenced today to 12½ years in federal prison for transporting child pornography via computer. The defendant, NATHAN ARGER, 34, who was arrested in September 2011 when federal agents searched his residence, has remained in federal custody since he pleaded guilty in August 2012.
Arger was sentenced to 151 months in prison, followed by five years of supervised release, by U.S. District Judge Amy J. St. Eve. He must serve at least 85 percent of his federal sentence before he is eligible for release and there is no parole in the federal prison system. Transporting child pornography carries a mandatory minimum sentence of five years and a maximum of 20 years in prison.
Arger was a part-time employee of Lyons Township High School in La Grange. There were no allegations that he engaged in any illegal activity involving students or the school’s technology equipment.
According to court records, in July 2011, an undercover FBI agent signed onto an account on a peer-to-peer computer network, and observed that an individual using the screen name “Mrdizzle420” was logged into the file-sharing network. The agent browsed Mrdizzle420’s shared directories and downloaded files, which depicted child pornography, including numerous images involving known child victims identified by the National Center for Missing and Exploited Children (NCMEC) as a result of previous unrelated investigations.
FBI agents subsequently linked the shared files to an internet account at Arger’s residence. Ultimately, Arger was found to possess approximately 66,895 images and 2,943 videos of child pornography on a desktop computer and an auxiliary hard-drive. Agents also found non-pornographic photographs of a prepubescent girl who was partially nude and videos that depicted Arger with a different girl.
“[Arger] cataloged and stored a staggering number of images and videos of child pornography, the majority of which involved prepubescent children and some of which were clearly sadistic or masochistic in nature,” the government wrote in a sentencing memo.
The investigation was conducted by the FBI’s Child Exploitation Task Force. The task force is part of a nationwide effort known as the Innocence Lost National Initiative targeting those involved in the commercial sexual exploitation of children in the United States. In Chicago, the CETF is comprised of FBI special agents and officers and investigators from the Chicago Police Department, the Cook County Sheriff's Office, and the Cook County State’s Attorney’s Office.
The sentence was announced by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, and Cory B. Nelson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
The government was represented by Assistant U.S. Attorney Naana Frimpong.
Stevie Marie Anne Vigil Indicted for Purchasing Firearm for Evan EbelRead the Press Release
DENVER – Stevie Marie Anne Vigil, age 22, of Commerce City, Colorado, was indicted by a federal grand jury on August 8, 2013 on one count of knowingly transferring a firearm to a convicted felon, United States Attorney John Walsh, 18th Judicial District Attorney George Brauchler and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Denver Special Agent in Charge Andrew Traver announced.
Vigil was arrested without incident this morning by ATF agents at the Arapahoe County Courthouse. She will make her initial appearance in U.S. District Court in Denver this afternoon where she will be advised of her rights and the federal charges pending against her.
According to the indictment, on March 8, 2013, Vigil knowingly disposed of and transferred a firearm to Evan Ebel, knowing and having reasonable cause to believe that Evan Ebel had been convicted of a crime punishable by imprisonment for a term exceeding one year.
“Transferring a gun to a convicted felon is a serious federal crime, period, full-stop,” said U.S. Attorney John Walsh. “Federal and state authorities are working closely together to ensure that the grave crime in this case is prosecuted to the fullest extent of the law.”
“I am pleased to have the opportunity to participate in this collaborative and cooperative prosecution with U.S. Attorney John Walsh’s office,” said George H. Brauchler, District Attorney for the 18th Judicial District. “Our community is well served by vigorously enforcing the laws that keep guns out of the hands of dangerous criminals like Evan Ebel. Unfortunately, this case highlights the worst case scenario when criminals obtain guns.”
“Straw purchasing is not a victimless crime,” said Denver Special Agent in Charge, Andrew Traver. “The results of this careless act can be devastating to the community, and ATF will take every step to hold those individuals who disregard the federal firearms laws accountable.”
If convicted of transferring a firearm to a felon, Vigil faces not more than 10 years in federal prison, and a fine of up to $250,000.
The indictment is a result of a joint federal and state investigation involving multiple agencies, including: Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Colorado Bureau of Investigation (CBI), El Paso County Sheriff’s Office, the Denver Police Department, the Federal Bureau of Investigation (FBI), the Texas Rangers, the Wise County, Texas Sheriff’s Department, the Texas Department of Public Safety, and the Colorado Department of Corrections.
Vigil is being prosecuted by Assistant U.S. Attorney Richard Hosley, Chief of the U.S. Attorney’s Major Crimes Section, and Special Assistant U.S. Attorney Mark Hurlbert, Assistant District Attorney for the 18th Judicial District.
The charges contained in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
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St. Paul Man Sentenced for Bank FraudRead the Press Release
MINNEAPOLIS—Yesterday in federal court, a 37-year-old St. Paul man was sentenced for fraudulently obtaining funds from several financial institutions. On August 8, 2013, United States District Judge David S. Doty sentenced Christopher Terrelle Harness to 81 months in prison on one count of bank fraud and one count of aggravated identity theft. Harness was indicted on November 20, 2012, and pleaded guilty on March 11, 2013.
In his plea agreement, Harness admitted that from October 2007 through July 2012, he fraudulently obtained money from banks. Specifically, he and others, at his direction, opened accounts into which they deposited checks they knew were stolen or not backed by sufficient funds. Then, they made ATM withdrawals from the falsely inflated balances. In total, the victimized financial institutions sustained losses of between $30,000 and $400,000 because of this crime.
This case was the result of an investigation by the U.S. Postal Inspection Service and the Minnesota Financial Crimes Task Force. It was prosecuted by Assistant U.S. Attorneys Tracy L. Perzel and Manda M. Sertich.The Financial Crimes Task Force was established pursuant to state law and is comprised of local, state, and federal law enforcement investigators dedicated to combating the growing problem of cross-jurisdictional financial crimes. The task force, overseen by an advisory board also created under state law, serves the entire District of Minnesota, presenting its cases to county or federal prosecutors, as appropriate.
The task force and the Minnesota U.S. Attorney’s Office want to remind people to protect themselves from identity theft. For more information, visit http://www.stopfraud.gov/protect-identity.html
For more information on how to avoid becoming a victim of identity theft, visit https://postalinspectors.uspis.gov/investigations/MailFraud/fraudschemes/mailtheft/IdentityTheft.aspxSentences for August 6 – 7, 2013 Northern Arapaho Men Sentenced for Assault Resulting in Serious Bodily InjuryRead the Press Release
Ricardo Rodriguez-Contreras, 30, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on August 7, 2013, for illegal re-entry of a previously deported alien into the United States. Rodriguez-Contreras was arrested in Basin, Wyoming. He received time served plus ten days, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Phillip Henry Moralez, 46, of Cheyenne, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on August 6, 2013, for possession of child pornography. Moralez was arrested in Cheyenne, Wyoming. He received 120 months imprisonment, to be followed by 15 years of supervised release and was ordered to pay a $200.00 fine and a $100.00 special assessment. This case was investigated by the Wyoming Division of Criminal Investigation Internet Crimes Against Children Task Force.
Julian Lee Grimes, 28, of Kemmerer, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on August 6, 2013, for possession of child pornography. Grimes was arrested in Kemmerer, Wyoming. He received 30months of imprisonment, to be followed by ten 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 Internet Crimes Against Children Task Force.
Richard Dale Anderson, of Douglas, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on August 6, 2013, for failure to register as a sex offender. Anderson was arrested in Douglas, Wyoming. He received five months imprisonment, to be followed by five 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 Internet Crimes Against Children Task Force.
Jorge Lopez-Trejo, aka Alex Campos, aka Arturo Hernandez, aka Alex Zavala-Lara, 31, of Mexico, was sentenced by United States District Court Judge Scott W. Skavdahl on August 6, 2013, for illegal re-entry of a previously deported alien into the United States. Lopez-Trejo as arrested in Gillette, Wyoming. He received time served plus ten days, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Ronald Jay Miller Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on August 9, 2013, before Chief U.S. District Judge Dana L. Christensen, RONALD JAY MILLER, a 56-year-old resident of Helena, was sentenced to a term of:
Prison: 120 months, consecutive to another sentence
Special Assessment: $100
Forfeiture: computer and firearms
Supervised Release: 20 years
MILLER was sentenced in connection with his guilty plea to access with the intent to view child pornography.
In an Offer of Proof filed by Assistant U.S. Attorney Paulette L. Stewart, the government stated it would have proved at trial the following:
From approximately 2011 until October 18, 2012, MILLER accessed visual depictions of children engaged in sexually explicit conduct on his computer.
Montana Probation and Parole conducted a probation search of MILLER's residence on October 18, 2012, in reference to his possession of firearms at his residence. At that time, MILLER's computer and a number of floppy discs were seized.
While looking for information on MILLER's computer and floppy discs for firearm information, law enforcement located an image of a child engaged in sexually explicit conduct. Forensic examination revealed that MILLER accessed images and videos containing children engaged in sexually explicit conduct using his computer and the Internet. The Internet access dates were between approximately June 2011 and October 2012.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that MILLER will likely serve all of the time imposed by the court. In the federal system, MILLER does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Montana Probation and Parole.
Raceland Man, Ronald Breaux, Pleads Guilty to Distribution of Child PornographyRead the Press Release
RONALD BREAUX, age 67, of Raceland, Louisiana, pleaded guilty today before U. S. District Judge Nannette Jolivette Brown for a crime involving the sexual exploitation of children, announced United States Attorney Dana J. Boente.
According to court documents, BREAUX used “peer-to-peer” file sharing programs on his computer to search for, download, and share videos and images of children as young as 18-months-old engaging in sexually explicit conduct. On August 14, 2012, BREAUX distributed at least one video involving a girl approximately 8-years-old engaging in sexually explicit conduct to an undercover law enforcement agent. On September 25, 2012, law enforcement officials, led by the State of Louisiana Department of Justice - Office of the Attorney General, executed a search warrant at BREAUX’S residence and seized two computers and five electronic storage devices. A subsequently forensic search of the items revealed that BREAUX had used a series of search terms indicative of child pornography to search for the images and videos. After identifying files of interest, most of which had very explicit titles, BREAUX catalogued the pictures and videos in computer folders he created with names like “young,” “crime,” and “incest.” In total, BREAUX downloaded, viewed, and saved at least 1,485 images and 479 videos of children being victimized.
BREAUX faces a mandatory minimum term of imprisonment of 5 years and a maximum penalty of 20 years, followed by up to a life term of supervised release, and a $250,000 fine. He can also be required to register as a sex offender. Sentencing is scheduled for November 14, 2013, at 10:00 am.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
This case was investigated by agents from the State of Louisiana Department of Justice - Office of the Attorney General. The prosecution of this case is being handled by Assistant United States Attorneys Jordan Ginsberg and Matthew S. Chester.
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Owner of New York Construction Company Indicted for Tax FraudRead the Press Release
The Justice Department and Internal Revenue Service (IRS) announced that Tomas Olazabal, of Fresh Meadows, N.Y., was arrested today following his indictment in the U.S. District Court for the Eastern District of New York on Aug. 8, 2013, on multiple tax crimes.
According to the indictment, Olazabal owned Tupac Construction Corp., a construction company in Fresh Meadows. As alleged in the indictment, Olazabal used check cashing services to cash a substantial number of checks paid to his construction company for services between 2007 and 2008. He concealed his check cashing activities from his tax return preparers. Accordingly, the gross receipts represented by the checks negotiated at the check cashers were not included as gross receipts on the company’s tax returns.
The indictment alleges that Olazabal filed false 2007 and 2008 corporate income tax returns for Tupac. Olazabal faces a potential maximum sentence of six years in prison and a potential fine of up to $500,000.
A trial date has not been scheduled. An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Steve Descano of the Justice Department’s Tax Division.
Owner of Ocean City, N.J., Car Dealership Admits Targeting Sellers, Buyers and Lenders in Fraud SchemeRead the Press Release
CAMDEN, N.J. – The president, operator and manager of Harry Klause Cars and Trucks Inc., in Ocean City, N.J., admitted today to perpetrating a scheme to defraud automotive loan lenders and customers who traded in and bought vehicles at his dealership, U.S. Attorney Paul J. Fishman announced.
Harry Klause, 64, of Ocean City, N.J., pleaded guilty to an information charging him with wire fraud. He entered his guilty plea before U.S. District Judge Robert B. Kugler in Camden federal court.
According to documents filed in this case and statements in court:
Klause purchased trade-in vehicles from customers of his auto dealership and applied the purchase price against the price of vehicles those customers bought from the dealership. Though Klause agreed to pay off any existing loan the customers had on the trade-in vehicles, he didn’t do so in a timely way, causing damage to the customers’ credit scores. Klause then sold trade-in vehicles to other customers even though he had neither paid off the loans nor gotten the vehicle titles from the lenders.
Klause steered the buyers of the trade-in vehicles to various lenders to finance the purchases, but didn’t immediately – or ever – send the titles to those lenders. If a customer stopped paying a car loan, the lender would be without recourse to repossess the vehicle.
During his guilty plea proceeding, Klause admitted specific acts of fraud concerning individual transactions.
The wire fraud charge carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Sentencing before Judge Kugler is currently scheduled for Nov. 15, 2013.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to the guilty plea. He also thanked the Northfield, N.J., Police Department, under the direction of Chief Robert James; and the New Jersey Motor Vehicle Commission, Business Licensing Investigative Unit, under the direction of Investigator Thomas Bramley, for their assistance.
The government is represented by Attorney in Charge R. Stephen Stigall of the U.S. Attorney’s Office Camden branch.
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Defense counsel: William J. Hughes Jr., Esq., Atlantic City, N.J.Klause Information
Orthofix Territory Manager Sentenced to Eight Months in Prison for Committing Medicare Fraud and Paying KickbacksRead the Press Release
BOSTON – A Tennessee man was sentenced today in federal court to eight months in prison and ordered to pay $75,000 in criminal fines and forfeiture for committing Medicare fraud and paying kickbacks to health care professionals.
On May 7, 2013, Hunter A. Rigsby, 33, of Knoxville, Tenn., pleaded guilty to health care fraud and paying kickbacks. U.S. District Court Judge F. Dennis Saylor IV sentenced him to eight months in prison to be followed by one year of supervised release. Judge Saylor also ordered Rigsby to forfeit $70,000, pay a fine of $5,000, and pay restitution to victims of his offenses.
Rigsby, a former Territory Manager of Orthofix, Inc., admitted that he committed health care fraud, and paid kickbacks to two separate health care professionals. Between 2005 and 2011, Rigsby sold bone growth stimulator medical devices for Orthofix. Bone growth stimulators are used to assist spinal fusions and to help heal bone fractures that did not heal properly. On dozens of occasions, Rigsby altered patient medical records and forged physicians’ signatures on prescriptions and Medicare Certificates of Medical Necessity to induce the Medicare program to pay for bone growth stimulators that were not covered under program guidelines. Medicare only pays for “long bone” stimulators under certain circumstances; for instance, when at least 90 days have elapsed without clinically significant bone healing. Rigsby was well-aware of these guidelines, having received training on these guidelines at Orthofix. On numerous occasions, doctors in Rigsby’s territory ordered bone growth stimulators that did not satisfy Medicare’s guidelines. When this occurred, Rigsby falsified patient records to make it appear as though the claim was payable under Medicare’s guidelines, when in fact Medicare should not have paid. On some occasions, Rigsby prepared completely falsified orderswhere the physician had not ordered a bone growth stimulator at all.
In July 2009, Orthofix fired Rigsby after discovering his fraud scheme. Immediately thereafter, Rigsby and Orthofix sales personnel devised a scheme to allow Rigsby to continue to submit bone growth stimulator orders to Orthofix through a new front company that Rigsby created. Rigsby concealed his affiliation with the front company so that Orthofix compliance personnel would not detect that he was still doing business with the company. Rigsby continued to submit orders for stimulators, sending the orders in through separate individuals. Even though Rigsby had been fired for falsifying medical records, he continued to manipulate patient medical records and forge physician’s signatures until Orthofix finally severed its relationship with him in 2011. Through his scheme, Rigsby caused Medicare and other federal insurance programs to pay more than $400,000 for bone growth stimulators that should not have been paid because Rigsby falsified claims that were outside of program guidelines.
Rigsby also paid kickbacks to health care professionals to induce them to order Orthofix stimulators. For instance, Rigsby paid the person who was responsible for ordering stimulators at one of the largest medical practices in Tennessee. Rigsby approached this person and asked if he could pay this person in return for steering stimulator orders to Orthofix and Rigsby. The person agreed, and Rigsby left an envelope with $200 in cash at the person’s house. As another example, Rigsby entered into an arrangement to pay a nurse in Morristown, Tenn., each time that the surgeon who employed the nurse ordered an Orthofix stimulator. Rigsby left an envelope of cash ($200-$300) in the back of the nurse’s truck after the surgeon began to order stimulators.
In addition to the Rigsby sentence, the Orthofix investigation has to date resulted in a number of felony charges against employees and contractors of Orthofix, including the following:
- On Dec. 14, 2012, Orthofix was convicted of obstruction of a federal audit and paid approximately $42 million in criminal fines and civil payments, and was sentenced to probation for five years;
- On Jan. 22, 2013, Thomas Guerrieri, the former Orthofix Vice President of Sales, was sentenced to eight months in prison and was ordered to pay $50,000 in forfeiture and fines for paying kickbacks to health care professionals;
- On July 19, 2012, Michael Cobb, a physician’s assistant, was sentenced to six months in prison and six months home confinement and ordered to forfeit $10,000 and pay a $3,000 fine for accepting kickbacks from Orthofix;
- On Jan. 31, 2013, Mitchell Salzman, a former Orthofix Regional Manager, was sentenced to three months of home confinement and one year of probation for committing perjury;
- On Jan. 9, 2013, Derrick Field, a former Orthofix Territory Manager, was sentenced to five months of home confinement as part of a two year probation sentence, in addition to paying $44,000 in forfeiture and fines, for committing health care fraud;
- On Jan. 23, 2013, Michael McKay, a former Orthofix Territory Manager, was sentenced to three months home confinement and one year probation and paid $13,000 in forfeiture and fines for committing health care fraud;
- On Sept. 28, 2012, Brian Racey, a former Orthofix Territory Manager, was sentenced to one day incarceration, six month of home confinement, two years of supervised release, and a $2,500 fine for committing health care fraud; and
- On June 12, 2013, Ilene Terrell, MD, a physician in Virginia, was indicted for making false declarations to a grand jury in Boston. Her trial has not yet been scheduled.
The case was investigated by the Department of Health and Human Services Office of Inspector General. It was prosecuted by Assistant U.S. Attorney David Schumacher of U.S. Attorney Carmen M. Ortiz’s Health Care Fraud Unit.
Oneida, New York - Man sentenced to 217 months imprisonment, to be followed by a three year term of supervised release.Read the Press Release
United States Attorney Richard S. Hartunian announced today the sentencing of an Oneida area man on charges of arson and insurance fraud.
JEFFREY E. TRUMAN, SR., 55, formerly of Oneida, New York, appeared for sentencing today in federal court in Syracuse on charges of aiding and abetting an arson, two counts of mail fraud, and one count of using fire to commit a federal felony. The charges stem from a fire that destroyed the former Oneida Casket Company Factory building in Oneida. In November 2005, TRUMAN, along with two partners purchased the vacant factory buildings for $175,000. On November 12, 2006, five days before an insurance policy was to lapse, the buildings were destroyed by fire. Subsequently, TRUMAN submitted an insurance claim for $4,178,500 in fire related losses. A subsequent investigation determined that the fire had been intentionally set by TRUMAN’s son, Jeffrey Truman, Jr. On November 3, 2010, a jury found that TRUMAN, SR. had aided and abetted his son in committing the arson and subsequently attempted to defraud Erie Insurance Company in submission of his fire claim.
United States District Court Judge Norman A. Mordue sentenced TRUMAN to 217 months imprisonment, to be followed by a three year term of supervised release. TRUMAN was also ordered to make restitution to Erie Insurance Company in the amount of $548,406.55.
Benjamin M. Lawsky, Superintendent of Financial Services, said: “The reckless scheme orchestrated by the defendant placed scores of innocent people in harm’s way and could well have resulted in a horrific tragedy. I commend the Oneida Police Department for their collaboration with DFS on the case and thank the U.S. Attorney’s Office’s efforts to bring the case to a successful conclusion culminating in today’s sentencing.”
The case was investigated by the Oneida City Police Department, the Federal Bureau of Investigation, the Madison County Sheriff’s Department, the New York State Police, the Financial Frauds and Consumer Protection Division of the New York State Department of Financial Services, and, the Oneida Fire Department Cause and Origin Team. The case was prosecuted by Assistant United States Attorney Edward R. Broton and Gwendolyn E. Carroll.
New Jersey Man Sentenced to Ten Years for Receiving Child PornographyRead the Press Release
BOSTON – A Sayreville, N.J. man was sentenced yesterday in federal court in Boston on child pornography charges.
Anthony Scarano, 52, was sentenced by U.S. District Judge F. Dennis Saylor IV to 10 years in prison, followed by five years of supervised release. On May 14, 2013, Scarano pleaded guilty to two counts of receipt of child pornography.
On November 11 and November 24, 2012, Scarano coaxed a 15-year-old Massachusetts girl to send him pornographic videos of herself over the Internet. Scarano met the girl on an Internet chat room and over time groomed the girl for sexual exploitation. Police became aware of Scarano’s crimes after the girl’s guardian found disturbing images of her on her cell phone. At the time of the offenses, Scarano was married and employed as a Senior Content Manager at ThomasNet in New York City.
United States Attorney Carmen M. Ortiz; Kevin M. Niland, Inspector in Charge of the United States Postal Inspection Services; Barnstable Police Chief Paul MacDonald; and Yarmouth Police Chief Frank Frederickson made the announcement today. The case was prosecuted by Assistant U.S. Attorney David G. Tobin of Ortiz’s Major Crimes Unit.
Max Meadows Residents Sentenced on Gun ChargesRead the Press Release
ABINGDON, VIRGINIA – United States Attorney Timothy J. Heaphy announced today that Samuel Robert Conrad, III, 51, and Lynn Spencer Conrad, 53, both of Max Meadows, Va., were sentenced yesterday in the United States District Court for the Western District of Virginia in Abingdon to serve terms of imprisonment for violating federal firearms laws.
Samuel Conrad was ordered to serve 96 months imprisonment for one count of possession of a firearm by a convicted felon. Lynn Conrad was ordered to serve six months imprisonment for providing a firearm to a convicted felon.
According to evidence presented at the guilty plea hearings by Assistant United States Attorney Zachary T. Lee, in September 2008, investigators with the Wythe County Sheriff’s Office executed a search warrant at the Conrad’s residence in Max Meadows during an unrelated investigation. Officers found a number of firearms at the residence which were seized based upon Samuel Conrad’s status as a convicted felon. Through their investigation, law enforcement determined that these firearms had been provided to Samuel Conrad by his wife Lynn Conrad.
The investigation of this case was conducted by the Wythe County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant United States Attorney Zachary T. Lee of the United States Attorney’s Office in Abingdon prosecuted the case.
Massachusetts Man Charged with Making Hoax Emergency Services Calls to Elicit Swat Team ResponseRead the Press Release
An Athol, Mass., man has been charged in a criminal information with engaging in a practice known as “swatting,” which involves making hoax emergency telephone calls in order to elicit an armed police response (from a SWAT team) for the purpose of harassing someone believed to be at a specific location.
The announcement was made today by Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Carmen M. Ortiz of the District of Massachusetts.
Nathan Hanshaw, 22, of Athol, has agreed to plead guilty to the charges in the criminal information filed today in U.S. District Court in Massachusetts. The three-count information charges Hanshaw with making interstate threats, threats to use explosives and threats to use a firearm.
According to court documents, Hanshaw typically claimed during his swatting calls that he was a fugitive who was wanted by the authorities and that he had taken hostages and was armed with weapons, explosives and nerve agents. He demanded cash and a helicopter ride to Mexico and threatened to detonate his bombs and kill his hostages if his demands were not met. He also threatened to kill any law enforcement personnel who arrived at the location. According to court documents, Hanshaw generally claimed to be calling from an address that, unbeknownst to the law enforcement officers responding to the call, was the address of his intended swatting victim.
The information charges that Hanshaw made swatting calls to police departments across the United States, including departments in Denver; Ventura, Calif.; and Waverly, N.Y. In each case, armed police responses ensued. In response to Hanshaw’s swatting call to Ventura, more than 40 local and federal officers arrived at the purported crime scene, a hotel was evacuated and nearby streets were closed for several hours.
The counts of making interstate threats and making threats to use a firearm each carry a maximum penalty of five years in prison. The count of making threats to use an explosive carries a maximum penalty of 10 years in prison.
The case was investigated by the FBI and is being prosecuted by Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam Bookbinder the District of Massachusetts’s Computer Crimes Unit. The Massachusetts State Police and Ventura County Sheriff’s Department were among the law enforcement agencies that assisted in this investigation and prosecution.
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Information
Maryland Epidemiologist Sentenced to Prison After Pleading Guilty to Illegally Shipping Guns to Ghana and Defrauding Social Security AdministrationRead the Press Release
Oklahoma City, Oklahoma – Yesterday, SAMUEL ALPHONSO NIMO, 62, from Owings Mills, Maryland, pled guilty to illegally shipping firearms to the Republic of Ghana and to defrauding the Social Security Administration, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma. Following the guilty plea, Chief United States District Judge Vicki Miles-LaGrange sentenced Nimo to serve 12 months and one day in prison and pay $27,816.93 in restitution to the Social Security Administration.
According to court filings and information from the plea hearing, from May of 2009 through May of 2011, Nimo participated in illegally shipping at least eight firearms to the Republic of Ghana for resale. In addition, Nimo was receiving SSI benefits for the care of his child for a disability. However, Nimo unlawfully continued to collect SSI benefits from 2008 through 2011, after his child relocated to Germany in 2008 and was no longer entitled to receive benefits.
During the time the offenses were committed, Nimo worked as an epidemiologist for the Oklahoma State Department of Health. He is currently employed by the Baltimore City Health Department in Maryland.
At the combined plea and sentencing hearing yesterday, Nimo pled guilty to illegally shipping firearms to Ghana and to defrauding the Social Security Administration. Chief Judge Miles-LaGrange then sentenced Nimo to serve 10 months in prison on the firearms count and serve 12 months and one day in prison and pay $27,816.93 in restitution to the Social Security Administration on the fraud count.
This case was investigated by the Bureau of Alcohol Tobacco Firearms and Explosives and the Social Security Administration Office of Inspector General. The case was prosecuted by Assistant United States Attorney Ashley L. Altshuler.
Manhattan U.S. Attorney Announces $1.7 Million Settlement with Testquest, $2.3 Million Judgment Against Former Testquest Manager, and Filing of Criminal and Civil Charges Against Public School Teacher in Connection with Scheme to Defraud FederalRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and Brian M. Hickey, the Special Agent-in-Charge of the Northeastern Region of the United States Department of Education’s Office of Inspector General (“ED-OIG”), today announced various civil and criminal actions relating to a scheme to submit false claims for reimbursement by TESTQUEST, INC. (“TESTQUEST”), an educational services company, in connection with a federally-funded program to provide tutoring services to public school children. Those actions include: (1) the settlement of civil fraud claims previously filed against TESTQUEST for $1,725,000, and admissions of wrongdoing by TESTQUEST; (2) the settlement of civil fraud claims previously filed against MICHAEL LOGAN, a former manager of TESTQUEST, admissions of wrongdoing by LOGAN, and the entry of a $2.3 million civil judgment against him; (3) the filing of a criminal Information against SANDRA ALLEN, a public school teacher, charging her with defrauding the Department of Education in connection with her participation in the billing scheme; and (4) the filing of an amended civil complaint asserting fraud claims against ALLEN and two additional public school teachers, SYLVIA BRATHWAITE and QUENTON GITTENS, for their alleged participation in the billing scheme. U.S. District Judge Louis L. Stanton approved the civil settlements with TESTQUEST and LOGAN yesterday. The criminal Information against ALLEN was filed on August 5, 2013.
LOGAN previously pled guilty to a felony fraud charge in connection with his role in the fraudulent billing scheme before U.S. District Judge John F. Keenan on June 5, 2013.
Manhattan U.S. Attorney Preet Bharara said: “TestQuest was an educational testing services company schooled in fraud and filled with employees who willingly exploited a federally funded program designed to aid students in need. As we’ve stated before, we will make companies and individuals answer for their fraudulent schemes. We are pleased that, with these settlements and the prior guilty plea, TestQuest and Michael Logan have accepted responsibility for their conduct and agreed to pay millions of dollars in damages and penalties.”
ED-OIG Special Agent-in-Charge Brian M. Hickey said: “The Office of Inspector General has a unique and special law enforcement mission – to protect public education funds for America’s eligible students. These settlements and related criminal charges are an example of our continued commitment to this mission. We will pursue all available criminal and civil remedies to safeguard these vital educational development funds.”
According to documents filed in Manhattan federal court and statements made in related court proceedings:
The Supplemental Educational Services Program
Between 2005 and 2012, the New York City Department of Education (“NYCDOE”) received funds from the federal government to pay for Supplemental Educational Services (“SES”), which included after-school tutoring for students attending underperforming public schools. NYCDOE entered into contracts with private entities to provide SES tutoring to students in New York City public schools. Students were eligible to receive SES tutoring if they met certain criteria, such as attending a school that had been identified as needing improvement or restructuring for at least two years. Private entities contracted by NYCDOE to provide SES tutoring were required to have each student who attended a tutoring class sign a daily attendance sheet. The tutor of each class was also required to sign the attendance sheet, certifying that he or she had provided SES tutoring to the students whose signatures appeared on the attendance sheet.
TESTQUEST and the Individual Defendants
From 2005 through 2012 (the “Covered Period”), TESTQUEST contracted with NYCDOE to provide SES tutoring to students in New York City. TESTQUEST provided tutoring at various New York City public schools, including the Monroe Academy of Business and Law/High School of World Cultures (“Monroe”) and the Global Enterprise Academy/Christopher Columbus High School (“GEA”). TESTQUEST received approximately $2.3 million for purportedly providing tutoring at Monroe and GEA during the Covered Period.
Throughout that time, TESTQUEST employed LOGAN to manage its SES program at Monroe and GEA. LOGAN, in turn, recruited teachers from Monroe and GEA to serve as tutors for TESTQUEST’s SES program at those schools, and recent graduates of Monroe and GEA to serve as “aides” and help him run the program. ALLEN, BRATHWAITE and GITTENS were public school teachers employed by TESTQUEST as tutors.
The Billing Scheme
During the Covered Period, TESTQUEST obtained Title I funds by falsely reporting that it had provided SES tutoring to students when, in fact, no SES tutoring had been provided. As part of the scheme, TESTQUEST repeatedly submitted to NYCDOE bills for students who had not actually received any tutoring.
As part of its civil settlements, TESTQUEST admitted that:
- tutors prompted students to sign the daily attendance sheets for SES classes that the students had not attended, including by going to the Monroe cafeteria and instructing students who were in the cafeteria, but who had not received any SES tutoring, to sign the daily attendance sheets;
- tutors signed the instructor certifications on the daily attendance sheets — and thereby certified that they had provided SES tutoring to all of the students whose signatures appeared on the sheets — even though they had not provided SES tutoring to some or all of those students;
- aides also prompted students to sign the daily attendance sheets for tutoring classes that the students had not attended, including by bringing the daily attendance sheets to other after-school activities, such as baseball and basketball practice, and instructing students attending those activities to sign the sheets; and
- aides forged student signatures on the daily attendance sheets.
TESTQUEST further admitted that its daily attendance sheets from the Covered Period falsely reported that many more students had attended its SES tutoring classes than had actually attended. TESTQUEST also admitted that it used the falsified daily student attendance sheets to prepare invoices that it then submitted in connection with its SES tutoring program, and that the invoices ultimately resulted in TESTQUEST being paid federal funds for SES tutoring that it never provided.
LOGAN, who previously pled guilty to criminal charges, admitted as part of his civil settlement that he instructed tutors and aides to falsify entries on the daily attendance sheets. LOGAN further admitted that on multiple occasions throughout the Covered Period, he observed (1) tutors signing the instructor certifications on daily attendance sheets for tutoring that LOGAN knew had not been provided; (2) students signing daily attendance sheets for tutoring classes that LOGAN knew the students had not attended; and (3) aides forging student signatures on daily attendance sheets.
ALLEN, while working as an SES tutor for TESTQUEST, allegedly falsified daily attendance sheets to make it appear that more students had attended TESTQUEST’s SES classes than had actually attended and regularly signed the instructor certifications on daily attendance sheets for tutoring that she had not provided. In addition, in the 2008/2009 academic year, ALLEN allegedly enlisted four students at Monroe to participate in the billing scheme. Specifically, she allegedly directed the four students to find other students at Monroe to sign daily attendance sheets for SES classes that they had not attended. ALLEN is also alleged to have purchased food for the four student “helpers” to reward them for their assistance in the scheme.
BRATHWAITE and GITTENS, who similarly served as SES tutors for TESTQUEST, also allegedly signed the instructor certifications on daily attendance sheets for tutoring that they had not provided.
TESTQUEST agreed to pay the Government $1,725,000 in damages and penalties under the False Claims Act in connection with the fraudulent billing scheme. TESTQUEST also agreed not to participate in any federal procurement or non-procurement transactions for a period of three years.
LOGAN, 48 of White Plains, New York, settled civil claims filed against him, made admissions concerning his conduct, and agreed to the entry of a civil judgment against him in the amount of $2.3 million. In connection with his prior guilty plea, LOGAN faces a maximum sentence of five years, and is scheduled to be sentenced by Judge Keenan on October 9, 2013.
By filing its civil claims against TESTQUEST and LOGAN, the Government joined a private whistleblower lawsuit that had previously been filed against them under the False Claims Act.
ALLEN, 53, of New York, New York, is charged with one count of conspiracy to defraud the federal Government. She faces a maximum sentence of five years.
The civil charges against ALLEN, BRATHWAITE, and GITTENS remain pending.
Mr. Bharara thanked the Office of the ED-OIG for its extraordinary assistance in this case.
The criminal cases are being handled by the Complex Frauds Unit, and Assistant U.S. Attorneys Joseph P. Facciponti and Christopher B. Harwood are in charge of the prosecution. The civil cases are being handled by Christopher B. Harwood of the Office’s Civil Frauds Unit.
The charges contained in the Criminal Information against ALLEN are merely accusations, and she is presumed innocent unless and until proven guilty.
U.S. v. TestQuest Stipulation
U.S. v. Michael Logan Stipulation
U.S. v. Testquest, et al Amended Complaint