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19 August 2013
Former Program Manager Pleads Guilty to Federal Charge in Connection with Diesel Fuel Theft at Military FacilityRead the Press Release
Matthew Brock illegally used a government-issued credit card to purchase thousands worth of fuel; sold an associate diesel belonging to Guard facility in Red House
HUNTINGTON, W.Va. – A former program manager pleaded guilty today in federal court in connection with a theft scheme that took thousands of dollars’ worth of diesel fuel from a military facility located in Putnam County, announced U.S. Attorney Booth Goodwin. Matthew Todd Brock, 42, of Hurricane, W.Va., pleaded guilty to theft of government property before United States District Judge Robert C. Chambers in Huntington.
Brock, who was hired in September 2010 as the program manager for the Naval Special Warfare Command (NSW) program in Red House, began using a government-issued credit card to make illegal fuel purchases. Beginning in February 2012 and continuing through March 2012, Brock illegally used the credit card to put fuel into his personal vehicle and family members’ vehicles. In total, Brock made approximately $5,619 in illegal fuel purchases using the credit card.
Additionally, beginning in May 2012, Brock began stealing diesel fuel from the NSW Ops Stock program in Red House and later sold the fuel to an acquaintance for $1 per gallon. Brock sold the stolen diesel fuel once or twice per week for approximately eight months. Over that time period, Brock illegally sold a total of nearly $15,000 in diesel fuel that he stole from the facility.
The NSW, a component of the U.S. Navy, contracted with the West Virginia National Guard to run its Operational Stock (Ops Stock) program to store and maintain equipment for naval operations at the Guard’s Combined Support Maintenance Shop facility in Red House. The equipment maintained by the National Guard as part of the Ops Stock program used diesel fuel.
In a related matter, Charles Raymond Franklin, 59, of Red House, W.Va., was charged in July in a three-count indictment for conspiring to steal and receive public property and conspiring to receive stolen government property. Franklin is alleged to have knowingly received approximately 196 gallons of diesel fuel that was stolen from the National Guard’s Combined Support Maintenance Shop on February 15, 2013.
Franklin faces up to five years on the receiving stolen property charge and up to 10 years in prison on each charge of conspiring to receive stolen government property, if convicted. Franklin also faces a $250,000 fine on each count.
Brock faces up to 20 years in federal prison and a $500,000 fine when he is sentenced on November 18, 2013.
The investigation was conducted by the FBI. Assistant United States Attorney Blaire Malkin is in charge of the prosecution.
Former Oregon Resident Pleads Guilty to FraudRead the Press Release
PORTLAND, Ore. – A former resident of Pacific City pleaded guilty in federal court today to stealing more than $70,000 from the Social Security Administration (SSA), the Oregon Department of Human Services (DHS), and Medicaid. Peter C. Byrne, 87, admitted before U.S. District Court Judge Garr M. King that between 1992 and 2012, he concealed from SSA and DHS his travels outside the United States and his compensation, while receiving Supplemental Security Income (SSI) and food stamps. Sentencing is scheduled for December 3, 2013, at 10:30 a.m.
According to documents filed by the government and Byrne’s admissions today, Byrne began receiving SSI in 1990 and was required to report to SSA certain travel outside the United States, as well as his income and compensation. Between 1992 and 2012, Byrne traveled outside the U.S. for more than 30 days at least 15 times, on some occasions remaining outside the U.S. for more than four months. Between 2009 and 2012, Byrne also maintained bank accounts with Barclays of England and Wells Fargo where he held more than $85,000 at one time, and failed to disclose these bank accounts to SSA and DHS. When Byrne was questioned by SSA and investigators in 2012, he failed to disclose all of his travels and assets. When SSA asked to see his passport, Byrne advised that he had accidentally destroyed his passport by running it through the washing machine.
The plea agreement requires Byrne to pay restitution to SSA, DHS, and Health and Human Services. Byrne has deposited $25,000 with the court to be applied towards restitution immediately following sentencing.
The case was investigated by the Social Security Administration Office of Inspector General, Office of Investigations. It is being prosecuted by Special Assistant United States Attorney Helen L. Cooper, as part of a partnership venture between the Social Security Administration Office of General Counsel and the United States Attorney’s Office.
Former LIRR Employee Pleads Guilty in Manhattan Federal Court in Connection with Disability Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that DONALD ALEVAS, a former director of shop equipment planning for the Long Island Railroad (“LIRR”), pled guilty today in Manhattan federal court to charges related to the allegedly massive fraud scheme in which LIRR workers claimed to be disabled upon early retirement so that they could receive disability benefits to which they were not entitled. ALEVAS pled guilty before U.S. Magistrate Judge Michael H. Dolinger. He is the 26th defendant to plead guilty in the case. Three other defendants were convicted after a jury trial in August 2013.
According to the Complaint, the Superseding Indictments, the Superseding Informations, and statements made in other public filings and court proceedings:
The Railroad Retirement Board (“RRB”) is an independent U.S. agency that administers benefit programs, including disability benefits, for the nation’s railroad workers and their families. A unique LIRR contract allowed employees to retire at the relatively young age of 50 – the age of eligibility has since changed to 55 – if they had been employed by the LIRR for at least 20 years. Eligible employees are entitled to receive an LIRR pension, which is a portion of the full retirement payment for which they are eligible at 65. In addition, at full retirement age (between age 60 and age 65 depending on years of service), they are eligible to receive an RRB retirement pension. For LIRR workers who retired at 50 with only an LIRR pension, they would receive less than their prior salary and substantially lower pension payments than those to which they would be entitled at full retirement age. However, LIRR employees who retired and claimed disability could receive a disability payment from the RRB on top of their LIRR pension, regardless of age. A retiree’s LIRR pension, in combination with RRB disability payments, can be roughly equivalent to the base salary earned during his or her career.
Hundreds of LIRR employees have allegedly exploited the overlap between the LIRR pension and the RRB disability program by pre-planning the date on which they would falsely declare themselves disabled so that it would coincide with their projected retirement date. These false statements, made under penalty of prosecution in disability applications, allowed LIRR employees to retire as early as age 50 with an LIRR pension, supplemented by the fraudulently obtained RRB disability annuity. From 1995 through 2011, more than 75% of LIRR employees stopped working and began receiving RRB disability benefits, whereas during this same period, only 25% of retiring Metro-North employees stopped working and began receiving RRB disability benefits. During the period 2004 through 2008, only three doctors were responsible for approximately 86% of the disability claims submitted by LIRR retirees. Of these three doctors, one is deceased; one, Dr. Peter J. Ajemian, pled guilty and was sentenced in May 2013 to eight years in prison; and the other, Dr. Peter Lesniewski, was convicted after a jury trial in August 2013 and awaits sentencing.
ALEVAS, a LIRR retiree who received disability benefits, made materially false statements about his ability to perform certain daily activities in his disability application submitted to the RRB.
ALEVAS, 54, of Patchogue, New York, pled guilty to one count of making false statements. He faces a maximum sentence of five years in prison and is scheduled to be sentenced by U.S. District Judge Kimba M. Wood on January 7, 2014, at 11:00 a.m.
Thirty-three people have been charged in connection with the LIRR disability fraud scheme; 26 have pled guilty and three have been convicted following trial. Of the 26 defendants who have pled guilty, four have been sentenced: Dr. Peter J. Ajemian received a sentence of eight years in prison; William McAleavey, a former conductor for the LIRR, received a sentence of 30 months in prison; Gary Satin, a former electrician for the LIRR, received a sentence of 20 months in prison; and Maria Rusin, who was Dr. Ajemian’s office manager, received a sentence of probation. The charges against the remaining defendants, Kevin Neville, Frederick Catalano, Jr., Thomas Coscetta, and Michael Costanza, are merely allegations, and they are all presumed innocent unless and until proven guilty.
Mr. Bharara praised the work of the RRB Office of the Inspector General, the Federal Bureau of Investigation, and the Office of the Inspector General of the Metropolitan Transportation Authority for their outstanding work in the investigation, which he noted is ongoing. He also acknowledged the previous investigation conducted by the New York State Attorney General’s Office into these pension fraud issues.
The case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Nicole Friedlander, Tatiana Martins, Edward Imperatore, Justin Weddle, and Daniel Tehrani are in charge of the prosecution.
U.S. v. Donald Alevas S6 Information
Former Ft. Lauderdale Executive Sentenced to 15 Years for Money Laundering and Obstruction of Justice in Connection with Mutual Benefits Corporation FraudRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Michael J. De Palma, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announce that on August 16, 2013, U.S. District Judge Kathleen M. Williams sentenced defendant Steven Steiner, a/k/a “Steven Steinger,” 61, to 15 years in prison (180 months) in connection with money laundering and obstruction of justice related to the use and concealment of more than $15 million dollars in proceeds derived from the Mutual Benefits Corporation (MBC) fraud.
Previously, on February 28, 2013, a federal jury in Miami convicted Steiner on 19 of 54 counts, including conspiracy to commit money laundering offenses, money laundering, conspiracy to commit offenses against the United States, and various obstruction of justice offenses. Steiner also was ordered to serve three-years supervised release upon the expiration of his prison sentence relating to Steiner’s participation in a scheme to launder and conceal proceeds from the MBC fraud, and Steiner’s obstruction of United States Securities and Exchange Commission (SEC), the court-appointed receiver for MBC, and the United States District Court, in their efforts to secure and recover assets traceable to the fraud. The jury acquitted Steiner’s co-defendant Henry Fecker, III, on all charges.
At trial the United States presented evidence that from approximately 1994 to May 2004, MBC purchased life insurance policies from persons suffering from AIDS, chronically ill, and elderly persons. Having purchased the life insurance policies, MBC sold fractionalized interests in the death benefits, known as “viatical settlements,” to approximately 30,000 investors. In promotional materials, MBC told investors that its viatical settlements offered a fixed rate of return with low risk, and that investors’ principal and returns were paid by the insurance companies. Evidence at trial established that MBC misrepresented various material facts relating to its viatical settlements, including: the estimated life expectancies of the insured persons, MBC’s title to certain life insurance policies, the risks associated with certain policies, the payment of premiums, and the source of funds used to pay investors. Witnesses testified that new investor money was used to pay premiums on life insurance policies purchased by earlier investors and to pay investors who requested their money back. The evidence established that as the fraud continued, investor money was required to prevent the MBC Ponzi-scheme from collapsing. Ultimately, investors lost more than $750 million.
Steiner was a founder, principal, and Vice President of MBC, and he received more than $15 million in proceeds from the MBC fraud through two shell corporations that he controlled: Camden Consulting, Inc., and SKS Consulting, Inc.
In May 2004, the SEC filed a civil enforcement action in the United States District Court for the Southern District of Florida, SEC v. Mutual Benefits Corp., et al., Case No. 04-60573-CIV-MORENO (the “SEC Fraud Action”), against MBC and various “relief defendants,” including Steiner’s shell corporations. On May 4, 2004, United States District Judge Federico A. Moreno entered an order appointing Coral Gables attorney Roberto Martinez as the receiver for MBC, with the mandate to identify, secure, trace, and recover the assets of MBC.
As the jury found, following the closure of MBC and the appointment of the MBC receiver, Steiner engaged in money laundering transactions designed to conceal the source, location, ownership, and control of his proceeds from the MBC fraud. At the same time, Steiner acted to obstruct the SEC, the MBC receiver, and the United States District Court.
Evidence at trial disclosed that in 2006 and early 2007, Steiner submitted false and misleading financial disclosure documents to the SEC to persuade the SEC to agree to a favorable settlement of the SEC claims against him and his shell corporations Camden Consulting and SKS Consulting, in the SEC Fraud Action. Based upon Steiner’s fraudulent financial disclosure, the SEC agreed to a reduced penalty of $3.9 million, and on April 10, 2007, the District Court entered a Final Judgment in the SEC Fraud Action ordering Steiner, SKS and Camden to pay $3.9 million to the court-appointed receiver for MBC. Evidence at trial established that Steiner acted to thwart the MBC receiver’s efforts to trace and recover MBC assets and recover on the final judgment. Among other things, Steiner repeatedly lied under oath during depositions and physically concealed documents, including checks representing proceeds from the MBC fraud.
Steiner is currently awaiting trial in two related cases in the Southern District of Florida. In United States v. Joel Steinger, et al., Case No. 08-21158-CR-Scola, Steiner and co-defendants Joel Steinger and Anthony Livoti are charged with conspiracy to commit mail and wire fraud and money laundering, in relation to the MBC fraud scheme. In United States v. Joel Steinger et al., Case No. 12-20123-CR-Rosenbaum, Steiner, Joel Steinger, and Henry Fecker III are charged with engaging in a multi-million dollar scheme to defraud insurance companies.
Mr. Ferrer commended the investigative efforts of the FBI and IRS-CI. This case was prosecuted by Assistant United States Attorneys Jerrob Duffy and Dwayne E. Williams.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Franklin, Tennessee Business Owner Sentenced to 31 Years in Prison for Fraud SchemeRead the Press Release
Richard Olive Also Ordered to Pay Over $5.9 Million in Restitution to 190 Victims
Richard Olive, 49, of Vero Beach, Florida, formerly of Nashville, was sentenced today to serve 31 years in prison and ordered to pay $5,992,181.24 in restitution to approximately 190 victims for crimes related to his operation of National Foundation of America (“NFOA”), announced David Rivera, Acting U.S. Attorney for the Middle District of Tennessee. Olive was convicted by a federal jury on March 7, 2013, on charges of mail fraud, wire fraud, and money laundering.
“The sentence imposed by the Court today should send a strong message to those who would attempt to engage in any scheme sophisticated or otherwise, which may be designed to defraud elderly persons and others who are particularly vulnerable,” said Acting U.S. Attorney, David Rivera. “The U.S. Attorney’s Office and our law enforcement partners simply will not stand for such schemes to continue and will devote whatever resources are necessary to protect the elderly from such financial predators and bring them to justice.”
The evidence at trial showed that from January 2006 through May 2007, Olive represented that NFOA, which was headquartered in Franklin, Tennessee, was a charitable organization that had been recognized by the IRS as a 501(c)(3) organization. During the scheme, Olive solicited assets, including annuities and real estate, of over $30 million from elderly individuals and promised that, in return, the individuals would receive an “installment bargain contract” issued by NFOA that would give them a “guaranteed payout over a guaranteed period of time,” as well as a “generous tax deduction.”
Olive promised clients that in exchange for an NFOA “installment bargain contract,” they would receive a fixed payment for a number of years. However, the evidence at trial demonstrated that NFOA never had sufficient assets to meet these obligations. The majority of assets which Olive solicited were annuities, which incurred high penalties on their surrender. When Olive received these annuities, he surrendered them, incurring penalties, so that he could access the cash. He then used the cash to fund his lavish lifestyle, including paying for $153,000 of personal expenses on credit cards, funding a trip to New Orleans on a private jet with his family, settling a lawsuit against him for $250,000, and purchasing several properties with cash, including a $690,000 condominium in Las Vegas.
"Illegal activity involving the investment industry has brought financial ruin to many Americans,” stated Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation. “IRS-Criminal Investigation is committed to unraveling complex financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money. We are proud to work with our law enforcement partners by lending our expertise in these complex financial investigations.”
“Today’s sentence sends a strong message to those who would use investment schemes to devastate the financial standing of innocent victims and their families,” said A. Todd McCall, Special Agent-in-Charge of the Memphis Division of the Federal Bureau of Investigation. “It is especially cruel when frauds like these target senior citizens. In today’s challenging economic conditions, the FBI and its law enforcement partners will continue to target those who abuse vulnerable citizens in our community.”
Other evidence at trial showed that Olive made a series of misrepresentations about NFOA during the scheme. For example, in February 2006, just days after NFOA had been incorporated, he sent fabricated financial statements to a financial advisor that falsely represented NFOA had been in operation in 2003 and 2004 and held significant assets. In May 2006 Olive represented to a different financial advisor that the company had $35 million in assets, although the charitable tax returns he filed with the State of Tennessee indicated that from its inception to June 2006, NFOA had received only $2.8 million in revenue.Although Olive held NFOA out to be a “charitable organization,” he donated to charity only approximately $108,000 – less than ½ of 1% of the $23.6 million NFOA received.
Further, throughout the scheme, Olive repeatedly represented that his organization had been recognized by the IRS under Section 501(c)(3) of the Internal Revenue Code, although the evidence at trial demonstrated that this statement was false. Olive continued to make this false representation even after his attorney told him on at least two occasions to stop.
Five states issued cease-and-desist orders during the scheme, based in part on their findings that Olive was misrepresenting NFOA’s 501(c)(3) status, and ordered him to stop selling NFOA’s product in those states. The company was seized and ultimately liquidated by the Tennessee Department of Commerce and Insurance in May 2007.
At sentencing, the District Court found and applied sentencing enhancements based on the large loss amount, Olive’s leadership role, the fact that he misrepresented that he was acting on behalf of a charitable organization, the sophisticated nature of the scheme, and the large number of vulnerable victims. Olive has remained in federal custody since the jury’s verdict on March 7, 2013.
The case was investigated by the FBI and the IRS– Criminal Investigation Division. Assistant United States Attorneys Kathryn B. Ward and Darryl A. Stewart represented the government.
Former Country Club Hills Police Chief Pleads Guilty to Obstruction of JusticeRead the Press Release
SPRINGFIELD, Ill. – Regina R. Evans, former police chief for Country Club Hills., Ill., appeared in federal court in Springfield again today to enter pleas of guilty to obstruction of justice, witness tampering, and conspiracy to obstruct justice and witness tampering in the federal investigation of her role in a grant fraud scheme. Evans, 50, previously pled guilty, on June 17, 2013, to charges of fraud related to a $1.25 million state grant awarded in 2009 to We Are Our Brother’s Keeper, a not-for-profit program that Evans owned with her husband, Ronald W. Evans, Jr. Ronald Evans has also pleaded guilty to the fraud scheme and is scheduled to be sentenced on Dec. 2, 2013.
Regina Evans appeared this morning before U.S. District Judge Sue E. Myerscough and entered an open plea of guilty to one count each of obstruction of justice, witness tampering, and conspiracy to obstruct justice and witness tampering. Sentencing in this case is scheduled on Oct. 15, 2013, the same date of sentencing in Regina Evans’ fraud case. Regina Evans remains in the custody of the U.S. Marshals Service.
Regina Evans was charged in this case in March 2013, along with her brother, Ricky McCoy, 52, of Chicago. The next court date for the case against McCoy is scheduled for status conference on Aug. 28, 2013. In addition to the charges with his sister, McCoy is also charged with three counts of money laundering. According to the indictment, McCoy assisted the Evanses in the management of We Are Our Brother’s Keeper.
In today’s court hearing and according to court documents, Regina Evans conspired with others to have a person identified as Individual A create a false story for law enforcement, the grand jury, and as a witness in a court proceeding, to falsely represent that the individual performed actual work under the grant awarded to We Are Our Brother’s Keeper. In fact, Individual A performed no such work and the checks issued to Individual A were merely a means to conceal grant funds converted to cash and returned to the benefit of the Evanses. The false story created for Individual A falsely represented that Individual A worked as a teacher under the grant, and instructed students on “soft skills,” to include manners, how to dress for an interview, how to groom themselves, how to behave in interviews and how to write a resume, when in fact, Regina Evans knew the story was false and intended to obstruct the investigation of the grant fraud.
Members of the public are reminded that the indictment charging McCoy remains as merely an accusation; the defendant is presumed innocent unless proven guilty.Assistant U.S. Attorney Timothy A. Bass is prosecuting the case on behalf of the U.S. Attorney’s Office for the Central District of Illinois. The ongoing investigation is being conducted by participating agencies of the Central District of Illinois’ U.S. Attorney’s Office’s Public Corruption Task Force including the U.S. Postal Inspection Service, Chicago Division; the Internal Revenue Service Criminal Investigations; and, the Illinois Secretary of State Office of Inspector General. Individuals who wish to provide information to law enforcement regarding matters of public corruption are urged to call the U.S. Attorney’s Office at 217-492-4450.
The maximum statutory penalty for each count of the offenses charged is as follows: obstruction of justice – up to 10 years in prison; witness tampering – up to 20 years in prison; conspiracy to obstruct justice and witness tampering – up to five years in prison; and for money laundering - up to 20 years in prison. Regina Evans faces additional penalties of up to 10 years in prison to be served consecutive to any sentence ordered for the underlying offenses because the offenses were committed while the defendant was on pre-trial release.
Ferriday Funeral Home Director Sentenced to 70 Months in Prison for Receiving Child PornographyRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced today that funeral home director John Casey Young, 45, of Vidalia, La., was sentenced before U.S. District Judge Dee D. Drell to 70 months in prison and 9 years of supervised release for knowingly receiving child pornography on his computer. He was also ordered to pay a $16, 750 fine and will be required to register as a sex offender.
According to evidence presented at the guilty plea, the FBI discovered that Young used his work computer to search for child pornography on the internet. Young pleaded guilty on March 15, 2013.
“Mr. Young’s actions furthered the abuse of children and contributed to a worldwide trade of such material,” Finley stated. “Our office will continue to prosecute cases such as this as part of our ongoing effort to protect child victims.”
“This investigation should serve as yet another reminder to the community of the strong and continuous commitment of the FBI and its law enforcement partners to expend all our available resources to protect children from such despicable conduct,” said Michael J. Anderson, FBI Special Agent in Charge, New Orleans Division.
The FBI and the Rapides Parish Sheriff’s Office conducted the investigation. Assistant U.S. Attorneys Earl M. Campbell and John Luke Walker prosecuted the case.
This case is part of Project Safe Childhood, a U.S. Department of Justice launched nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Those concerned may leave also tips with the FBI at tips.fbi.gov. Tips may be submitted anonymously. The Alexandria FBI office number is (318) 443-5097.
Federal Court Permanently Bars Indiana Instant Tax Service Franchisee from Tax PreparationRead the Press Release
A federal court in Indianapolis permanently barred David Franklin and his company, Instant Refund Tax Service (IRTS), from preparing tax returns and from operating a tax-preparation business, the Justice Department announced today. The government alleged that IRTS, which Franklin wholly owns, operated as a franchisee of Instant Tax Service, a large national tax-preparation franchisor operated by ITS Financial LLC, based in Dayton, Ohio. The order follows an earlier preliminary injunction against the defendants. In a separate case, a federal court in Ohio preliminarily enjoined the Dayton-based franchisor last November. The defendants in both cases consented to entry of the preliminary injunctions without admitting the allegations against them.
The Indiana permanent injunction order was signed by Judge Sarah Evans Barker of the U.S. District Court for the Southern District of Indiana. The government complaint in the case alleged that Franklin owned and operated 22 Instant Tax Service locations that prepared and filed false and fraudulent income tax returns for customers, fabricated income for phony businesses to obtain larger tax credits, forged W-2 forms, filed returns improperly based on paycheck stubs rather than W-2 forms, claimed false education tax credits and reported false filing statuses for customers. The government also accused Franklin’s offices of filing tax returns without customers’ authorization and selling false and deceptive loan products to customers.
The case is one of five similar civil actions that the Justice Department brought against Instant Tax Service franchises and the corporate franchisor, ITS Financial, which claims to be the fourth-largest tax-preparation firm in the nation. The court recently conducted a two-week trial in the Ohio case, in connection with the government’s request to permanently enjoin the Instant Tax Service franchisor. A decision has not yet been issued.
For more information on the earlier preliminary injunction against Franklin and IRTS visit www.justice.gov/tax/2013/txdv13129.htm and for more information on actions brought against the Instant Tax Service franchise visit www.justice.gov/tax/2012/txdv121304.htm. In the past decade, the Justice Department’s Tax Division has obtained hundreds of injunctions to stop tax-fraud promoters. More information about those cases is available on the Justice Department website.
United States v. David R. Franklin, et al.
Stipulated Order for Permanent Injunction Against David Ray Franklin and Instant Refund Tax Service, Inc. (PDF)Fargo Scrap Metal Dealer Sentenced for Failing to File an Income Tax ReturnRead the Press Release
FARGO – U.S. Attorney Timothy Q. Purdon announced that on Aug. 19, 2013, Hamzo Omerovic of Fargo, N.D., was sentenced before U.S. Magistrate Judge Karen K. Klein for willfully failing to file an income tax return for calendar year 2006. Omerovic pleaded guilty to the Class A Misdemeanor on March 25, 2013.
U.S. Attorney Timothy Q. Purdon said, “Failure to file tax returns is a serious crime which can result in prosecutions like this one. Those who criminally evade their duty to file and pay federal taxes unfairly shift their tax burden on to the backs of hard-working Americans who comply with the tax laws.”
"The term voluntary compliance means that each of us is responsible for filing a tax return when required and for paying the correct amount of tax," according to Special Agent in Charge Kelly R. Jackson of the St. Paul Field Office IRS Criminal Investigation. "That responsibility should not be taken lightly. Tax crimes have erroneously been referred to as victimless, but that position could not be more wrong since we all end up paying when someone attempts to evade our tax system."
Judge Klein sentenced Omerovic to five years of probation under the supervision of the U.S. Probation Office, including standard and special conditions of probation. Omerovic was ordered to pay restitution to the United States as determined pursuant to a civil tax audit for tax years 2006, 2007, and 2008. The audit will be conducted by the examination division of the Internal Revenue Service (IRS). Omerovic was also ordered to pay a $25 special assessment.Omerovic, 27, a self-employed scrap metal dealer, in 2006 purchased and obtained scrap metal in Fargo and the surrounding area, which he then sold to a number of scrap metal dealers, primarily in North Dakota and Minnesota. The investigation conducted by the IRS - Criminal Investigation Division, showed that Omerovic’s gross receipts for the year totaled in excess of $152,000, with an estimated tax loss, for sentencing purposes, of more than $30,000.
Omerovic admitted, in the plea agreement and in court, that he had willfully failed to file a 2006 income tax return with the IRS, even though he had earned sufficient gross income and knew he was required to file a return no later than April 17, 2007.
The case was investigated by the IRS - Criminal Investigation Division.
Assistant U.S. Attorney Scott S. Schneider is prosecuting the case.
Enoch B. Morelock AwardRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that Sgt. Shannon Jeffries, an investigator with the Callaway County, Mo., Sheriff’s Department, has received the 2013 Enoch B. Morelock Award.
The Enoch B. Morelock Award is an annual recognition of outstanding moral character, service to law enforcement and service to the community. The prestigious law enforcement award, presented annually by the U.S. Attorney’s Office, is named in honor of Sullivan County Sheriff Enoch B. Morelock, who was the first recorded line of duty death in the Western District of Missouri on Dec. 19, 1847.
Jeffries, coordinator of MUSTANG (the Mid-Missouri Unified Strike Team and Narcotics Group), was honored for his commitment to public service both on and off duty during the 11th Annual LECC Training Seminar in Springfield, Mo., on Thursday, Aug. 15, 2013.
Jeffries has served as the coordinator for MUSTANG for three years, a MUSTANG narcotics officer for 12 years and Sergeant/Investigator for the Callaway County Sheriff's Department for 17 years. He also serves as the Certified Firearms Instructor and Certified Active Shooter Instructor for the sheriff's department. The MUSTANG Drug Task Force Board can attest to the excellent statistics of the task force he coordinates, his display of leadership, honorable moral character and unrelenting drive to serve and give back to his community and department in his duties assigned, which are many.
A substantial amount of illicit drugs and currency have been seized and numerous convictions made due to the coordination of the MUSTANG Drug Task Force. MUSTANG includes the sheriff’s departments in Callaway, Cole, and Boone counties, the police departments of Jefferson City, Columbia, Fulton and Boonville and the Missouri State Highway Patrol.
Jeffries unselfishly gives back to the community in other ways by participating in a youth mentor program within the Jefferson City School District, which entails meeting with a grade school child on a weekly basis. He also coaches youth sport programs, is active in the neighborhood watch program and provides informative presentations to area schools and to other law enforcement agencies in order to enhance their knowledge of drugs and public safety.
Today's law enforcement community calls on officers and leaders capable of working well with others, collaboration, exhibiting effective interpersonal communication, innovation, inspiration and the ability to contribute without dominating any task. It is these skills that Jeffries brings to every case/situation and administrative decision he makes. His extraordinary poise and the environment he inspires derive the very best from his officers of the MUSTANG Drug Task Force and colleagues of the sheriff's department.
Enoch B. Morelock Award
Sullivan County Sheriff Enoch B. Morelock was the first recorded line of duty death in the Western District of Missouri on Dec. 19, 1847, in Sullivan County. Sheriff Morelock was shot and killed during a court-ordered sale of the accused=s property. The accused killer, Patrick McIntry, was charged with 1st Degree Murder but was later acquitted. Within a year Mr. McIntry was found shot to death on the banks of a local river.
The annual Enoch B. Morelock Award recognizes individuals with outstanding moral character, service to law enforcement and to the community outside of law enforcement. Recipients may include officers from local police departments, sheriffs= offices, state agencies, or federal agencies as well as investigators from prosecutors' offices.
District Man Sentenced to Nearly 14 Years in PrisonRead the Press Release
For Series of Attacks Against Taxicab Drivers
-He and Others Posed as Passengers at Union Station, Other Places-WASHINGTON - Tony Copeland, 22, of Washington, D.C., has been sentenced to nearly 14 years in prison on charges stemming from a series of attacks against taxicab drivers, U.S. Attorney Ronald C. Machen Jr. announced today.
Copeland pled guilty in May 2013 in the Superior Court of the District of Columbia to one count each of carjacking and robbery. He was sentenced on Aug. 16, 2013 by the Honorable Heidi M. Pasichow to 13 years and 360 days of incarceration.
The charges were filed in a series of cases involving the carjacking, assault, and robbery of taxicab drivers that took place in October and November of 2011. The government alleged that Copeland was the ringleader behind several incidents in which he and others went to the Union Station taxicab line posing as paying customers, soliciting cab fares to the area of 44th Street NE. Once at the destination, Copeland and his accomplices would choke the drivers from behind, or simply demand money. Among the items stolen from the several victims were hundreds of dollars in cash, cell phones, GPS devices, and a Rolex watch.
The carjacking charge stemmed from a crime that took place on Nov. 14, 2011. That day, at about 3:45 p.m., Copeland and three others solicited a taxicab from Union Station. Copeland asked the driver to take them to the 4600 block of Grant Street NE. When the driver arrived at the destination, Copeland reached around from the rear driver’s side seat and choked the driver from behind by placing his arms around the driver’s throat. Meanwhile, the two other individuals went through the driver’s belongings, stealing cash, credit cards, a cell phone, and a blank check filled out in the amount of $180. Copeland and the others ordered the cabdriver out of the taxi. One of the individuals, a juvenile, got into the driver’s seat and drove away with the cab. Copeland and the remaining individual ran from the scene. The victim was able to flag down a neighbor, who gave the victim a cellphone to call 911. The taxicab was recovered days later by the Metropolitan Police Department (MPD), in the area near Copeland’s residence.
The robbery charge stemmed from an incident on Nov. 20, 2011, this time starting at the Greyhound bus station on First Street NE. Copeland and another accomplice arrived at the station at about 11:30 a.m. and stood outside waiting for a cab. They solicited a taxicab ride and asked the driver to take them to the area of the 4600 block of Brooks Street NE. Once there, the accomplice put the driver in a choke-hold. Copeland and the accomplice stole about $100 in cash, a cellphone, car keys and a brown leather jacket in the attack.
In announcing the sentence, U.S. Attorney Machen praised the work of those who investigated the case from the Metropolitan Police Department. He also commended the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Antoinette Sakamsa and Tony Griffith, Victim/Witness Advocate Jim Brennan, and Assistant U.S. Attorney Richard E. DiZinno, who prosecuted the matter.
13-287District Man Pleads Guilty to Sexually Attacking 9-Year-Old GirlRead the Press Release
In Broad Daylight on Northeast Washington Street
-Accosted Girl After She Left a Store-WASHINGTON - Demetrick Littlejohn, 27, of Washington, D.C., has pled guilty to a charge stemming from a recent attack on a nine-year old girl that took place in broad daylight in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced today.
Littlejohn pled guilty on Aug. 16, 2013 in the Superior Court of the District of Columbia to one count of attempted second-degree child sexual abuse in an Alford plea. Under such a plea, the defendant does not admit the allegations but agrees that the government has enough evidence to secure a conviction. Littlejohn is scheduled to be sentenced by the Honorable Russell F. Canan on Oct. 18, 2013. He faces up to five years in prison. In addition, Littlejohn will be required to register as a sex offender for ten years.
According to the government’s factual proffer, on July 26, 2013, at about 1:15 p.m., Littlejohn grabbed a nine-year-old girl who had just come out of a store with her godmother on H Street NE, near Seventh Street. After whispering in her ear that he wanted to have sex with the girl, Littlejohn threw her to the ground and engaged in sexual contact with her until another man pulled him away. Littlejohn walked away but was apprehended and arrested a short time later. Littlejohn told the police that, at the time of the attack, he was high on PCP and recalled none of what had happened. The police also thought Littlejohn was on PCP at the time, and subsequent drug testing of Littlejohn resulted in positive results for PCP.
In announcing the plea, U.S. Attorney Machen praised the work of the members of the Metropolitan Police Department’s Youth Division, who investigated the case. He also expressed appreciation for those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Jason Manuel, Victim/Witness Advocate Lezlie Richardson, and Assistant U.S. Attorney Peter V. Taylor, who investigated and prosecuted the matter.
13-286Consultant to Former New Mexico Secretary of State Sentenced to Ten Years in Prison for Conviction for Theft of Federal “Help America Vote Act” (Hava) Funds and Related Obstruction of Justice and Money Laundering ChargesRead the Press Release
ALBUQUERQUE – This afternoon U.S. District Judge William P. Johnson sentenced Armando C. Gutierrez, 65, of Corpus Christi, Texas, to ten years in federal prison followed by three years of supervised release for his convictions for conspiracy, theft of government property, obstruction of justice and money laundering. Gutierrez was ordered to pay $2,500,483 in restitution to the State of New Mexico, including $746,375 which is to be paid jointly with co-defendant Joseph C. Kupfer, 50, of Rio Rancho, N.M. The court previously entered an order requiring Gutierrez to forfeit $2,500,483, including his interest in his Corpus Christi residence, to the United States.
Gutierrez’s sentence was announced by Acting U.S. Attorney Steven C. Yarbrough, New Mexico Attorney General Gary K. King, Dawn Mertz, Special Agent in Charge of the Phoenix Division of the IRS Criminal Investigation, and Carol K.O. Lee, Special Agent in Charge of the Albuquerque Division of the FBI.
In announcing the sentence, Acting U.S. Attorney Steven C. Yarbrough said, “Those who do business with the government must be held to the same high standards as government officials. When private citizens enter into contracts to provide services paid for with taxpayers’ monies, they become duty bound to provide honest services for the monies they receive. The sentence imposed on Armando Gutierrez today appropriately penalizes him for violating that duty when he stole more than $2,500,000 in taxpayers’ monies and failed to provide any services for that money. When individuals – whether public officials or government contractors – abuse the public’s trust in this way, they corrupt the system and erode the public’s confidence in their government. I commend the New Mexico Attorney General's Office for initiating the investigation of this case, and the IRS and FBI for undertaking the comprehensive and complex investigation that permits us to hold Mr. Gutierrez responsible for stealing from the public he contracted to serve.”
New Mexico Attorney General Gary King said, “I am pleased that the fruits of our investigation were used to help secure convictions against those who violated the public trust. I highly commend our AG investigators for their hard work in tracking down the misuse of public funds that led to this prosecution. I very much appreciate the cooperation extended to my office by the U.S. Attorney’s Office.”
“A lengthy prison sentence is what happens when individuals steal federal funds then obstruct and conceal their crimes. In this case, Mr. Gutierrez misappropriated voter education funds and used the money for his own benefit. IRS Criminal Investigation, along with our law enforcement partners, will continue to aggressively investigate the theft of taxpayer dollars,” stated IRS Criminal Investigation Special Agent in Charge Dawn Mertz.
“Those of us in government entrusted with taxpayer’s hard earned funds have an obligation to see that money is properly spent,” said FBI Special Agent in Charge Carol K.O. Lee. “In this situation, money that was designated to promote a fundamental right and civic obligation was instead stolen by greedy and unscrupulous individuals more concerned with their own comfort and wealth. The FBI appreciates the efforts of its Special Agents, as well as the IRS Criminal Investigation and the New Mexico Attorney General’s Office, to bring these people to justice.”
This case was initiated in Dec. 2010, by the filing of a three-count indictment charging Kupfer and his wife, Elizabeth D. Kupfer, 51, with failing to report at least $768,333 in taxable income during tax years 2004 through 2006, and evading $286,175 in federal taxes. An eleven-count superseding indictment was filed in July 2011, adding Gutierrez as a defendant and five counts charging Gutierrez and Kupfer with conspiracy and theft of government property relating to federal HAVA funds administered by former New Mexico Secretary of State (NMSOS) Rebecca Vigil-Giron. The superseding indictment also charged Gutierrez with two counts of obstruction of justice relating to a federal audit and investigation into the misuse of federal HAVA funds and one count of laundering unlawfully obtained proceeds, and retained the original tax evasion charges against the Kupfers. At the time of the events described in the superseding indictment, Gutierrez and Kupfer were providing consulting services to the NMSOS under HAVA contracts, and Mrs. Kupfer was an employee of the New Mexico Attorney General’s Office (NMAGO) who had been detailed to work for the NMSOS.
The court severed the three tax evasion counts from the other eight counts in the superseding indictment for purposes of trial, and scheduled separate trials for the Kupfers on the three tax evasion charges (the tax trial), and for Gutierrez and Kupfer on the conspiracy, theft, obstruction of justice and money laundering charges (the HAVA trial).
The tax trial commenced on Aug. 13, 2012, and concluded on Aug. 17, 2012, when the jury returned a guilty verdict against the Kupfers on all three tax evasion charges. The evidence established that, during the years 2004 through 2006, Kupfer received income including federal HAVA funds, from Kupfer Consulting (KC), a business owned and operated by Kupfer, and the Kupfers reported income from KC in their joint personal tax returns. During those three years, the Kupfers received $1,304,421 in revenue from KC but reported only $502,541 in their tax returns. The Kupfers concealed approximately $768,333 in income by providing incomplete information to their tax preparer and thus avoided paying taxes on that money.
The HAVA trial began on Jan. 22, 2012 and ended on Jan. 31, 2013, when the jury returned guilty verdicts against Gutierrez and Kupfer on the conspiracy and theft of government property charges, and against Gutierrez on the obstruction of justice and money laundering charges. In summary, the evidence established that, between April 2003 and Dec. 2006, the NMSOS administered almost $20 million in federal HAVA funds, which were designated for voter education, increasing voter registration, and meeting new standards for election administration and voting systems, through a number of contracts. The contracts included a multi-million dollar contract for voting-related advertising awarded to A. Gutierrez and Associates, Inc. (AGA), which was owned and operated by Gutierrez, and three small contracts for increasing voting accessibility for the disabled that were awarded to KC, Kupfer’s business.
According to the evidence, Gutierrez and Kupfer conspired together to defraud the United States by stealing federal HAVA funds and converting the funds to their own use. Between Sept. 2004 and Oct. 2006, AGA received a total of $6,271,810 in federal HAVA funds from the State of New Mexico but Gutierrez submitted documentation supporting only $3,385,151 in services and costs, resulting in an overpayment of $2,500,483 to which AGA was not entitled. In addition to the three small contracts totaling $70,000 which were awarded to KC by the NMSOS, AGA made nine payments totaling $746,375 in federal HAVA funds to Kupfer between Oct. 2004 and Nov. 2006, which far exceeded the value of any work that Kupfer ever actually performed for AGA under the HAVA contract.
In early 2007, the Election Assistance Commission began an audit into the use of federal HAVA funds by the NMSOS. The AGA HAVA contract immediately became the primary focus of the audit because AGA could not provide documentation to support the federal HAVA funds AGA received. In an effort to provide documentation for the federal HAVA funds AGA received, AGA provided 187 fraudulent invoices totaling $1,137,000 that purported to represent payment to media vendors when in fact AGA never paid any vendors based on these invoices. Subsequent to the EAC audit and in response to federal grand jury subpoenas, AGA and KC submitted fraudulent invoices that purported to support the nine payments totaling $746,375 that KC received from AGA between Oct. 2004 and Nov. 2006. Three of these invoices sought payments in the aggregate amount of $236,605 for production of a poll worker training video that was actually produced by another subcontractor at the cost of $75,000.
On May 14, 2013, Mrs. Kupfer was sentenced on her tax evasion conviction to three years in prison followed by three years of supervised release. Mrs. Kupfer also was ordered to pay $288,339 in restitution to the IRS.
Kupfer’s sentencing hearing is scheduled for Sept. 11, 2013. At sentencing, Kupfer faces a maximum penalty of five years in prison on the conspiracy charge, and a maximum penalty of ten years in prison on each of the theft of government property charges. He also may be fined up to $250,000 on each count of conviction.
The case was investigated by the IRS Criminal Investigation and the Albuquerque office of the FBI, with assistance from the New Mexico Attorney General’s Office. The case was prosecuted by Assistant U.S. Attorneys Tara C. Neda, Jeremy Peña and Cynthia L. Weisman.Citizen of Romania Admits Role in Atm Skimming SchemeRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that IONUT-IULIAN VLAD, 29, a citizen of Romania, pleaded guilty today before United States Magistrate Judge Joan G. Margolis in New Haven to one count of conspiracy to commit bank fraud stemming from his role in an ATM “skimming” scheme.
According to court documents and statements made in court, VLAD and others conspired to install “skimming” devices on automated teller machines (“ATMs”) at Bank of America locations in Connecticut. The devices were able to capture the information encoded on the magnetic strips of bank cards used by ATM customers. The co-conspirators also placed devices on the ATMs that contained hidden pinhole cameras, which recorded the personal identification numbers that bank customers keyed into the ATMs to gain access to their accounts. The co-conspirators used the stolen information captured by the skimming devices and pinhole cameras to create counterfeit bank cards that allowed them to withdraw more than $100,000 in funds from the customers’ accounts.
In February 2013, surveillance video captured VLAD removing skimming devices and pinhole cameras from Bank of America ATMs in Wallingford and Greenwich.
VLAD has been detained since his arrest by the Stamford Police Department on March 2, 2013. At the time of his arrest, VLAD possessed ATM skimming tools and double-sided tape.
VLAD is scheduled to be sentenced by U.S. District Judge Janet Bond Arterton on November 8, 2013, at which time he faces a maximum term of imprisonment of 30 years, a fine of up to $1 million and an order of restitution.
This investigation is being conducted by the Connecticut Financial Crimes Task Force, which includes members of the United States Secret Service, United States Postal Inspection Service, United States Department of State, Bureau of Diplomatic Security, Internal Revenue Service – Criminal Investigation, Connecticut State Police, and the Greenwich, Hartford, Stamford, Shelton and Stratford Police Departments. Acting U.S. Attorney Daly specifically recognized the efforts of the Greenwich and Stamford Police Departments for their assistance in the investigation and prosecution of this matter.
This case is being prosecuted by Assistant U.S. Attorney Douglas P. Morabito.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Chinese National Pleads Guilty to Attempting to Illegally Export Aerospace-Grade Carbon Fiber to ChinaRead the Press Release
Today, at the federal courthouse in Brooklyn, New York, Ming Suan Zhang, a citizen of the People’s Republic of China, pled guilty to violating the International Emergency Economic Powers Act by attempting to export massive quantities of aerospace-grade carbon fiber from the United States to China. According to court filings, Zhang was arrested after trying to acquire a sample of the specialized carbon fiber, a high-tech material used frequently in the military, defense and aerospace industries, which is closely regulated by the United States Department of Commerce to combat nuclear proliferation and terrorism.
The guilty plea was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; James T. Hayes, Jr., Special Agent-in-Charge, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), New York; and Sidney Simon, Special Agent-in-Charge, U.S. Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement, New York Field Office. The plea took place before United States District Judge Nicholas G. Garaufis.
“Zhang crossed the ocean to obtain massive quantities of restricted American technology for the stated purpose of assisting the Chinese military. He was actively working to circumvent laws that protect our national security by preventing specialized technologies from falling into the wrong hands,” stated U.S. Attorney Lynch. “We will use every tool at our disposal to protect our nation against those who would seek to export valuable defense technology from the United States.” Ms. Lynch expressed her grateful appreciation to the DOC and HSI, which worked closely together to investigate the case and bring the defendant to justice, and noted that the government’s investigation is ongoing.
According to court documents and statements in court today, Zhang came to the attention of federal authorities last year after two Taiwanese accomplices attempted to locate large quantities of the specialized carbon fiber via remote Internet contacts. Zhang told an undercover law enforcement agent that he had an urgent need for the carbon fiber in connection with the scheduled test flight of a Chinese fighter plane. Zhang then arranged a meeting in the United States with an undercover agent to take possession of a carbon fiber sample, which was to be shipped to China and analyzed to verify its authenticity. Zhang was placed under arrest after he arrived for the meeting. The scheme was aimed at obtaining thousands of pounds of the high-grade fiber.
The regulation of carbon fiber falls under the jurisdiction of the Department of Commerce, which reviews and controls the export of certain goods and technology from the United States to foreign countries. In particular, the Commerce Department has placed restrictions on the export of goods and technology that it has determined could make a significant contribution to the military potential or nuclear proliferation of other nations, or that could be detrimental to the foreign policy or national security of the United States.
Carbon fiber composites of the type allegedly pursued by Zhang and his accomplices are ideally suited to applications where strength, stiffness, lower weight, and outstanding fatigue characteristics are critical requirements. These composites also can be used in applications where high temperature, chemical inertness and high damping are important. The two main applications of carbon fiber are in specialized technology, particularly in the fields of aerospace and nuclear engineering, and in general engineering and transportation. In addition, certain carbon fiber-based composites, such as the material sought by the defendant, are used in military aircraft.
At sentencing on November 15, 2013, Zhang faces up to 20 years in prison and a fine of up to $1,000,000.
The government’s case is being prosecuted by Assistant United States Attorneys Seth DuCharme and David Sarratt, with assistance from Trial Attorney David Recker of the Department of Justice Counterespionage Section. Assistance was also provided by Trial Attorney Dan E. Stigall of the Department of Justice Office of International Affairs.
The Defendants
MING SUAN ZHANG
Age: 41California Man Sentenced to Federal Prison for Fraudulent Cellphone SchemeRead the Press Release
ALBUQUERQUE – A California man was sentenced late Friday afternoon for his role in a scheme to fraudulently obtain high-value cellular phones from retail stores in California, Arizona and New Mexico and to resell the cellular phones for profit. Joshua Ferdman, 25, of Woodland Hills, Cal., was sentenced to 15 months in federal prison followed by three years of supervised release. Ferdman also was ordered to pay $45,715.59 restitution to the victims of the criminal scheme.
Ferdman’s sentence was announced by Acting U.S. Attorney Steven C. Yarbrough, Resident Agent in Charge Richard Ferretti of Albuquerque Resident Office of the U.S. Secret Service, and Chief Allen Banks of the Albuquerque Police Department.
Ferdman and his three co-defendants, Jeffrey Contella, 28, and Joseph Cohen, 26, both of Los Angeles, Cal., and Amir Meir Levi, 36, of Sherman Oaks, Cal., were indicted in Feb. 2012, and charged with (1) conspiracy to transport stolen property and commit access device fraud and (2) access device fraud. Contella, Cohen and Levi entered guilty pleas to the indictment without the benefit of any plea agreement in Jan. 2013. Ferdman entered a similar guilty plea in Feb. 2013.
In entering their guilty pleas, the defendants admitted that, in May 2011, they engaged in a scheme to fraudulently obtain high-value cellphones, including smartphones, from Sprint stores, and resell the cellphones in a Van Nuys, Cal., store owned by Cohen and through an on-line store hosted by EBay. The defendants traveled to Sprint stores throughout California, Arizona and New Mexico and fraudulently obtained significant quantities of cellphones by impersonating Sprint customers and the unauthorized use of the customers’ account numbers. They obtained the phones free of cost by instructing store clerks to bill the cost of the phones to the accounts of the unwitting Sprint customers.
According to court filings, from May 10, 2011 through May 16, 2011, Ferdman and Levi traveled to Sprint stores in California, including stores in Fullerton, Los Angeles, Hollywood, San Francisco, Sacramento and Folsom, to perpetuate their fraudulent scheme. From May 21, 2011 to May 24, 2011, Ferdman and Contella traveled to Sprint stores in Arizona and New Mexico for that same purpose. During this period, Levi wired cash to Ferdman and Contella; Ferdman sent cellphones to Levi via Federal Express; Levi delivered the cellphones to Cohen; and Cohen sold the cellphones. On May 25, 2011, Ferdman, Contella and Levi fraudulently obtained 13 smartphones from a Sprint store in Albuquerque through the unauthorized use of a Sprint customer’s account number. That same day, Ferdman, Contella and Levi attempted to purchase an additional six smartphones from a Sprint store in Albuquerque.
Cohen’s sentencing hearing is scheduled on Sept. 6, 2013 and Levi’s sentencing hearing is set for Aug. 26, 2013. Contella’s sentencing hearing has yet to be scheduled. At sentencing, each faces a maximum penalty of five years in prison and a $250,000 fine on the conspiracy charge, and ten years in prison and a $250,000 fine on the access device fraud charge.
In announcing Ferdman’s sentence, Richard Ferretti, Resident Agent in Charge of the Albuquerque office of the Secret Service, said, “The results of this investigation are an example of the strategic partnerships between the Secret Service, Albuquerque Police Department, United States Attorney’s Office, and our private sector partners. We continue to prioritize investigative cases, focusing on electronic and financial crimes which have a significant community impact in New Mexico.”
The case was investigated by the U.S. Secret Service and the Albuquerque Police Department’s Organized Crime Unit, and is being prosecuted by Assistant U.S. Attorney John C. Anderson.17 Defendants Convicted on Federal Charges Marks Successful Conclusion of Savannah Anti-Gang InitiativeRead the Press Release
Operation Ruffian targeted drug and gun crimes committed in
Savannah high-crime areasSAVANNAH, GA - United States Attorney Edward J. Tarver today announced the successful completion of a joint federal and state anti-gang/violent crime initiative dubbed “Operation Ruffian,” which targeted offenders in the Cuyler-Brownsville and Carver Heights neighborhoods of Savannah. The investigation was spearheaded by the Savannah Area Regional Gun Enforcement Task Force (SARGE) which was jointly led by the ATF and the Savannah Chatham Metropolitan Police Department (SCMPD).
A total of 40 individuals were targeted for prosecution in the operation. 23 of these defendants are being prosecuted by the Chatham County District Attorney’s Office. The following 17 individuals were convicted and sentenced in the United States District Court for the Southern District of Georgia:Samuel A. Graham, 36, of Savannah, Georgia was convicted of drug trafficking. Graham was sentenced on October 12, 2011 to 151 months imprisonment.
Antwan L. Cross, 35, of Savannah, Georgia was convicted of possessing a firearm in furtherance of drug trafficking. Cross was sentenced on July 27, 2011 to 60 months imprisonment.
Brian R. Fallon, Jr., 25, of Savannah, Georgia was convicted of possessing an unregistered firearm. Fallon was sentenced on November 18, 2011 to 20 months imprisonment.
Johnny J. Early, 34, of Savannah, Georgia was convicted of drug trafficking and for possessing a firearm as a felon. Early was sentenced on May 9, 2012 to 50 months imprisonment.
Kewan G. Roberson, 23, of Savannah, Georgia was convicted of drug trafficking and for possessing a firearm as a felon. Roberson was sentenced on May 23, 2012 to 49 months imprisonment.
Randy M. Lewis, 25, of Savannah, Georgia was convicted of drug trafficking and for possessing a firearm as a felon. Lewis was sentenced on May 7, 2012 to 54 months imprisonment.
Marco O. Washington, 34, of Savannah, Georgia was convicted of drug trafficking. Washington was sentenced on March 22, 2013 to 60 months imprisonment.
Leearnell J. White, Jr., a.k.a. “Scrootney,” 31, of Savannah, Georgia was convicted of drug trafficking. White was sentenced on November 7, 2012 to 48 months imprisonment.
Edward B. Cone, 33, of Savannah, Georgia was convicted of possessing a firearm as a felon. Cone was sentenced on October 17, 2012 to 66 months imprisonment.
Linwood A. Brown, 53, of Savannah, Georgia was convicted of drug trafficking. Brown was sentenced on November 28, 2012 to 114 months imprisonment.
Eric L. McPherson, 41, of Savannah, Georgia was convicted of drug trafficking. McPherson was sentenced on October 31, 2012 to 160 months imprisonment.
Dominique A. Bostic, 19, of Savannah, Georgia was convicted of drug trafficking and a related firearm offense. Bostic was sentenced on October 12, 2011 to 151 months imprisonment.
Willie L. Smith, 30, of Savannah, Georgia was convicted of drug trafficking and for possessing a firearm as a felon. Smith was sentenced on April 11, 2013 to 72 months imprisonment.
Edward D. Singleton, 31, of Savannah, Georgia was convicted of drug trafficking. Singleton was sentenced on May 13, 2013 to 151 months imprisonment.
Michael P. Griffin, 23, of Savannah, Georgia was convicted of two separate federal firearm offenses. Griffin was sentenced on July 24, 2013 to 154 months imprisonment.
Travis L. Young, 19, of Savannah, Georgia was convicted of two separate federal firearm offenses. Young was sentenced on July 25, 2013 to 180 months imprisonment.
Cedric Reynolds, 24, of Savannah, Georgia for possessing a firearm as a prohibited person. Reynolds was sentenced on June 21, 2013 to 188 months imprisonment.
According to statistics kept by the SCMPD and evidence presented during numerous guilty plea and sentencing hearings, the individuals charged in the course of this operation were responsible for distributing cocaine and other street drugs valued at over $188,000. During the operation, investigators executed 14 search warrants and recovered 43 firearms, including 11 stolen firearms, which were used in the commission of crimes.
United States Attorney Tarver made several observations about the significance of the operation: “The persons indicted in this operation were responsible for a consistent pattern of drug dealing and firearms violations in these Savannah neighborhoods. The criminal acts which they engaged in made it difficult and dangerous for law-abiding residents to go about their daily routines. As a result of this investigation, 40 offenders have been removed from the two neighborhoods, including 17 convicted of federal offenses in the United States District Court. The disruption of two local gangs and the incarceration of numerous dangerous criminals should send a firm message to those who would plague our neighborhoods that federal, state, and local authorities are committed to keeping our streets safe from violent drug dealers and gun traffickers.”
The investigative agencies which took part in Operation Ruffian included SCMPD’s Central Precinct Crime Suppression Unit, the Savannah Area Regional Intelligence Center, the Georgia Bureau of Investigation, K9 units of the Chatham County Sheriff’s Office and SCMPD, the SCMPD S.W.A.T. team, the United States Marshal’s Service, the FBI, and the Chatham County District Attorney’s Office. The operation was led by ATF Special Agent Toby Taylor and SCMPD Detective Kevin Grogan.
The cases presented in United States District Court were prosecuted by Assistant United States Attorneys Karl Knoche, Shane Mayes, Jennifer Solari, and Greg Gilluly. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
18 August 2013
Grimes Woman Sentenced in Connection with Mortgage FraudRead the Press Release
Des Moines, Iowa – Bobbi Jo Wojewoda, age 46, of Grimes, Iowa, was sentenced by United States District Court Chief Judge James E. Gritzner to 18 months in prison for conspiracy to commit bank fraud, announced United States Attorney Nicholas A. Klinefeldt. Judge Gritzner also sentenced Wojewoda to serve 60 months of supervised release following the completion of her prison term.
In an earlier hearing, Wojewoda admitted she used her position as an apprentice appraiser to prepare appraisals with inflated values to help herself, and others qualify for mortgage loans. Wojewoda also failed to disclose material conflicts of interest to the mortgage lender when she performed appraisals on her own home and homes where she was the real estate agent.
In a related matter, Wojewoda’s husband, Wade Charles Wojewoda, age 45, pled guilty to receipt of proceeds obtained under false pretenses, related to the purchase of the Wojewoda’s home in 2003. Wade Wojewoda admitted he received loan proceeds knowing, or he was aware of a high probability, that the proceeds had been obtained under false pretenses. Specifically, he knew, or deliberately closed his eyes to the fact that a false document had been submitted to a bank to secure the loan proceeds. Wade Wojewoda was sentenced to three years probation on July 31, 2013.
This case was investigated by the Federal Bureau of Investigation, and the case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
(Download Press Release )
16 August 2013
Winchester Man Pleads Guilty to Child Porn ChargesRead the Press Release
HARRISONBURG, VIRGINIA – A Winchester man who has admitted to enticing 19 minors into engaged in sexually explicit conduct via web cams, pled guilty yesterday afternoon in the United States District Court for the Western District of Virginia in Harrisonburg.
Brian Patrick Aronhalt, 32, of Winchester, Va., pled guilty to one count of conspiracy to produce child pornography, one count of enticing minors to engage in sexually explicit conduct, four counts of producing child pornography, one count of possession of child pornography and one count of distributing child pornography.
“Mr. Aronhalt admitted that he used deception to repeatedly abuse children,” United States Attorney Timothy J. Heaphy said today. “His case serves as a grim reminder for parents to monitor what their children are doing online. Those of us who work in law enforcement will continue to pursue and prosecute predators like Mr. Aronhalt. We won’t be successful, however, unless parents acknowledge the threat and take steps to help their children stay safe online.”
Aronhalt admitted yesterday to posing as a minor female online and enticing 19 minor boys to masturbate for him via webcam. The defendant learned from others online how to use a sexually explicit video of a female to appear as a live webcast to the minor boys. Using the pre-recorded video, Aronhalt enticed the boys to masturbate for him via webcam and recorded the sexually explicit conduct.
In addition, during the execution of a search warrant, agents from the Federal Bureau of Investigation and the DC Internet Crimes Against Children Task Force found thousands of images depicting child pornography on Aronhalt’s computers.
At sentencing, the defendant faces a mandatory minimum sentenced of 15 years in Federal prison and a maximum possible penalty of life in prison. He also faces a potential lifetime of supervised release.
The investigation of the case was conducted by the Federal Bureau of Investigation, the DC Internet Crimes Against Children Task Force and the Child Exploitation and Obscenity Section of the Department of Justice. Assistant United States Attorney Nancy Healey will prosecute the case for the United States along with Trial Attorney Sarah Chang, U.S. Department of Justice, Child Exploitation and Obscenity Section (CEOS). CEOS’s High Technology Investigative Unit (HTIU) conducted computer forensic analysis for the case.
Wheeler County Man Sentenced to 21 Months in Federal Prison for Illegally Possessing FirearmsRead the Press Release
AMARILLO — Scott Leavitt, 39, of Shamrock, Texas, was sentenced this morning by U.S. District Judge Mary Lou Robinson to 21 months in federal prison following his guilty plea in May 2013 to a felony information charging one count of unlawful possession of a machine gun. Judge Robinson remanded Leavitt into custody. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to the factual resume filed in the case, on August 14, 2012, deputies with the Wheeler County Sheriff’s Office were dispatched to the Cemetery Road Trailer Park in Shamrock, where they found Leavitt, outside a mobile home, suffering from a severe injury to his hand. Leavitt advised that he had been making an explosive device and that it exploded in his hand. He was rushed to the hospital.
Deputies obtained a warrant and searched Leavitt’s mobile home. Inside they found remnants of the explosive device that had injured Leavitt, some hand grenades and two machine guns that had been originally manufactured as semi-automatic weapons, but had been converted to fully automatic weapons.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the FBI, the Wheeler and Winkler County Sheriff’s Offices and the Amarillo Police Department’s bomb squad. Assistant U.S. Attorney Vicki Lamberson prosecuted.
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:
Tyran Lenard, 23, 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 has been set for 11/21/2013. 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 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:
Marcus Henderson, 42, of South Bend, Indiana was sentenced by District Judge Robert L. Miller Jr to 39 months imprisonment and 3 years of supervised release after being found guilty of the felony offense of possession of firearm by an unlawful user of controlled substances.According to documents filed in this case, Henderson held a woman hostage until law enforcement arrived and intervened.Upon further investigation, five firearms were located in Henderson’s property, including a stolen handgun. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives.This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Demerius Shaw, 20, of Indianapolis, Indiana was sentenced by District Judge Robert L. Miller, Jr., to 600 months imprisonment and 10 years of supervised release after pleading guilty to the felony offenses of racketeering and carrying and using a firearm during a drug trafficking crime/crime of violence .Forty of the sentenced years are on Count 1 RICO which include a murder, two additional shootings and armed drug trafficking.According to documents filed in this case, in 2010 and 2011, Shaw was a member of the criminal enterprise Cash Out Boyz.During his time with the organization, Shaw was involved in the home invasion of a suspected drug dealer.During the invasion, an occupant of the home was shot and robbed of money and drugs. Shaw was also involved in additional numerous violent criminal activities including the murder of a rival gang member. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation and the South Bend Police Department.This case was prosecuted by Assistant United States Attorney Donald Schmid.
Tisha Martin, 44, of South Bend, Indiana was sentenced by Magistrate Judge Christopher A Nuechterlein to serve 6 months of probation and $350 in restitution after pleading guilty to the felony offense of obstructing the mail.According to documents filed in this case, Martin stole numerous first class greeting cards while working as a mail carrier.At least two items of stolen mail contained cash.The theft amount is estimated from $250 to $500. 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 Jesse Barrett.
Francisco Perez, 33, of Gary, Indiana was sentenced by District Judge Jon E. DeGuilio to serve 46 month imprisonment and 4 years supervised release after pleading guilty to the felony offense of knowingly and intentionally possessing with the intent to distribute over 500 grams of cocaine.According to documents filed in this case, in February 2013, Perez was arrested in the Lighthouse Mall parking lot in Michigan City with over 500 grams of cocaine. Perez had received the narcotic delivery from Gilberto Galindo-Lopez.This case was the result of an investigation by the Drug Enforcement Administration.This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Gilberto Galindo-Lopez, a/k/a Gabriel Ramirez, 33, of Los Angeles, California was sentenced by District Judge Jon E. DeGuilio to serve 65 months imprisonment (to run consecutive to the anticipated sentence in a state court case) and 4 years supervised release after pleading guilty to the felony offense of possessing with the intent to distribute over 500 grams of cocaine.According to documents filed in this case, in February 2013, Galindo-Lopez was arrested in the Lighthouse Mall parking lot in Michigan City with over 500 grams of cocaine. He had delivered the narcotic to Francisco Perez. This case was the result of an investigation by the Drug Enforcement Administration. This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Oscar Arzate, 26, of LaPorte, Indiana, a defendant in the case US v Campos et al., was sentenced by District Judge Jon E. DeGuilio to serve 46 months imprisonment and 3 years of supervised release after pleading guilty to the felony offense of distributing a mixture or substance containing cocaine.According to documents filed in this case, Arzate sold cocaine while working with the Campos family, a local established crime enterprise. This case was the result of an investigation by the Drug Enforcement Administration.This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Willis Fields, 47, of Elkhart, Indiana, was sentenced by District Judge Jon DeGuilio to serve 3 years supervised probation, 6 months location monitoring on home detention and $27,610.00 in restitution after pleading guilty to the felony offense of theft of government property.According to documents filed in this case, Fields applied for federal extended unemployment insurance benefits claiming that he was not working when in truth he was working at a company in Elkhart, Indiana.The total money defrauded was assessed at approximately $15,551.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:
Brittini Anderson, 27, of Gary, Indiana, pled guilty before Chief Judge Philip Simon to the felony offense of making false statements in the acquisition of a firearm.Sentencing has been set for 11/15/13.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 Nicholas Padilla.
Danilo Danti, 60, of Highland Park, Illinois, pled guilty before Chief Judge Philip Simon to the felony offense of transportation of stolen goods.Sentencing has been set for 11/15/13.This charge was filed as a result of an investigation by the United States Secret Service.This case is being prosecuted by Assistant United States Attorney Randall Stewart.
Kevin Paul Brewster, 41, of Portage, Indiana, pled guilty before District Judge Joseph Van Bokkelen to the felony offenses of production of child pornography, receipt of child pornography and possession of child pornography.Sentencing has been set for 10/31/13.This case resulted from an investigation by members of the Indiana Internet Crimes Against Children Task Force, including the Federal Bureau of Investigation and the Portage Police Department.This case is being prosecuted by Assistant United States Attorney Jill Koster.
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:
Alfonso Salinas, 53, of Hammond, Indiana, was sentenced by Chief Judge Philip Simon to 42 months imprisonment and 1 year of supervised release after pleading guilty to the felony offenses of receipt of a bribe by an agent of a local government receiving federal funds and failure to file a federal tax return.According to documents filed in this case, Salinas, an elected Hammond City Councilman at the time, readily accepted $10,500.00 from co-defendant David Johnson, to be influenced. Salinas corruptly accepted 10 checks during a 21 month period. During a 10 year time period (and overlapping the bribe payments), Salinas failed to file nine federal tax returns or pay any of the over $45,000.00 in taxes owed. Salinas also took in campaign contributions and deposited the money in his personal account.These contributions never appeared on campaign contribution account reports filed with the Board of Elections. This case was the result of an investigation by the Internal Revenue Service.This case was prosecuted by Assistant United States Attorney Gary Bell.
Shana King, 23, of Gary, Indiana, and Alnese Frazier, 27, of Indianapolis, Indiana, defendants in the case US v Harris et al., were sentenced by Chief Judge Philip Simon to 1 day, time served, after pleading guilty to the felony offense of conspiracy and attempt to commit fraud with identification documents.King was ordered to pay $27,061.59 in restitution and 2 years of supervised release.Frazier was ordered to pay $38,500.00 in restitution and 4 years of supervised release.The restitution amounts are to be paid jointly with all co-defendants in this case.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.
Justin Tiggs, 29, of Gary, Indiana, was sentenced by District Judge Joseph Van Bokkelen to 77 months imprisonment and 3 years of supervised release after pleading guilty to the felony offense of possession of ammunition by a convicted felon.Tiggs has prior felony convictions for aggravated use of a weapon by a felon, possession of a controlled substance and escape.This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives.This case was prosecuted by Assistant United States Attorney Thomas McGrath.
U.S. Attorney Heaphy Announces Distribution of Forfeiture Proceeds to Commonwealth’s AttorneysRead the Press Release
ABINGDON, VIRGINIA – In May 2012, global health care company Abbott Laboratories Inc., pleaded guilty in United States District Court in Abingdon to unlawful promotion of the prescription drug Depakote for uses not approved as safe and effective by the Food and Drug Administration. As part of its plea agreement with the Department of Justice, the company agreed to pay $1.5 billion to resolve criminal and civil liability arising from the company’s conduct.
Following a lengthy investigation led by AUSAs in the Western District of Virginia, Abbott pleaded guilty to misbranding Depakote by promoting the drug to control agitation and aggression in elderly dementia patients and to treat schizophrenia when neither of these uses was FDA approved. The company is currently on probation for this conduct and is implementing a series of changes designed to prevent off label marketing in the future.
“The federal prosecution of Abbott Labs resulted in a total settlement of $1.5 billon, the largest single-drug settlement of an off-label pharmaceutical fraud case in Department history,” U.S. Attorney Heaphy said today. “Substantial cases like this one help deter waste fraud and abuse in our health care system. The Assistant United States Attorneys in the Western District of Virginia have a long, distinguished track record of successfully bringing cases against drug manufacturers. We will continue to prioritize health care fraud cases and ensure that federal health care dollars are responsibly utilized.
Two Southern Illinois Men Sentenced on Methamphetamine ConspiracyRead the Press Release
On August 15, 2013, David A. Shockley, 36, of Murphysboro, IL, and Steven A. Zweigart, a/k/a “Swag,” 36, of Steeleville, IL, were sentenced in United States District Court in Benton on an indictment charging conspiracy to manufacture methamphetamine, announced Stephen R. Wigginton, United States Attorney for the Southern District of Illinois.
Shockley and Zweigart had previously pled guilty to the methamphetamine offense, which occurred between January 2011, and January 2013, in Perry, Jackson, and Randolph Counties. Shockley was sentenced to 180 months in prison, followed by 5 years supervised release, and fined $600. Zweigart was sentenced to 168 months in prison, followed by 4 years supervised release, and fined $600. Evidence at the plea hearings established that Shockley and Zweigart were involved with others in the manufacture of methamphetamine. Shockley and Zweigart obtained pseudoephedrine for use during the manufacture of methamphetamine and also were involved in the methamphetamine cooks. At sentencing, both Shockley and Zweigart received enhanced sentences based on their classification as Career Offenders. Five co-defendants have previously been sentenced for their role in the methamphetamine conspiracy. Five co-defendants have pled guilty and are awaiting sentencing.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Randolph County Sheriff’s Office, Perry County Sheriff’s Office, Percy Police Department, Murphysboro Police Department, Sparta Police Department, and Drug Enforcement Administration.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Two Organized Crime Members Sentenced to 180 Months and 168 Months, Respectively, for Conspiring to Distribute CocaineRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Joseph Sclafani and Neil Lombardo, members of the Gambino organized crime family of La Cosa Nostra, were sentenced to terms of imprisonment of 180 months and 168 months, respectively, following their April 2013 guilty pleas to conspiracy to distribute cocaine in Brooklyn and Staten Island. The sentences were imposed by United States District Court Judge John Gleeson, who also ordered that both defendants serve three years of supervised release upon their release from prison, and forfeit $500,000 in narcotics proceeds.
The sentences were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and Brian R. Crowell, Special Agent-in-Charge of the U.S. Drug Enforcement Administration (DEA).
“Years ago these defendants chose a life of violence and crime, pledging their loyalty to the Gambino crime family. Today’s case shows them still clinging to that choice, despite previous arrests and incarcerations. Once out of prison, both men continued their criminal connections and activities, working to bring cocaine across the country into the streets and neighborhoods of Brooklyn and Staten Island,” stated United States Attorney Lynch. “Today’s sentencings send an important message to both organized crime and drug trafficking enterprises. Both remain high priorities for the Department and this Office, and we will pursue them with all available resources and law enforcement methods -- particularly in the case of violent recidivists like the defendants in this case.” Ms. Lynch extended her grateful appreciation to the DEA, the agency responsible for leading the government’s investigation.
Between 2008 and August 2011, Lombardo and Sclafani conspired to distribute multi-kilogram amounts of cocaine in Brooklyn and Staten Island. Lombardo, who lived in Las Vegas, Nevada, obtained the cocaine from his sources in Mexico and then arranged for it to be transported to Brooklyn. Once the cocaine was in Brooklyn, Lombardo delivered it to Sclafani, who distributed to cocaine dealers throughout Brooklyn and Staten Island. According to government filings, in May 2009, Sclafani was stopped in Kansas en route to Las Vegas in possession of more than $100,000 that he intended to use to pay Lombardo for cocaine, and in April 2011, DEA agents at John F. Kennedy International Airport seized $155,000 in cash that Lombardo possessed as he waited to board a flight back to Las Vegas. In addition, Lombardo and Sclafani were recorded by a cooperating witness explicitly discussing their cocaine business and arranging multi-kilogram transactions. Lombardo and Sclafani agreed as part of their plea agreements with the government that they were responsible for conspiring to distribute between 15 and 50 kilograms of cocaine.
Both Lombardo and Sclafani have storied criminal histories. In addition to a prior felony narcotics trafficking conviction, in 1999, Lombardo was convicted of attempted murder in New Jersey State court and witness tampering in the United States District Court for the Southern District of New York after he shot the brother of an individual who he believed was cooperating with law enforcement against him. He was sentenced to 10 years’ imprisonment. In addition to felony racketeering and narcotics trafficking convictions, in 1990, Sclafani was convicted of criminal possession of a weapon and harboring the fugitive Gus Farace, who was wanted by authorities for the February 1989 murder of DEA Special Agent Everett Hatcher on Staten Island. Specifically, in November 1989, in an effort to protect Farace, Sclafani returned fired at assailants who shot at and killed Farace. Sclafani was sentenced to six years’ imprisonment.
Both Lombardo and Sclafani are inducted members -- “made men” -- in the Gambino crime family, a sign of their lifelong commitment to organized crime and the crime family’s recognition of their capacity for committing violent and lucrative crimes.
Eight other members of the conspiracy that Lombardo and Sclafani headed up have pled guilty to cocaine conspiracy charges, including Staten Island resident Afrim Kupa and his brother Lulzim Kupa. On August 9, 2013, Lulzim Kupa, who has prior convictions for narcotics trafficking, racketeering, bank larceny, and bank fraud, was sentenced to 132 months’ imprisonment for his role in the conspiracy. Afrim Kupa, who also has prior convictions for narcotics trafficking, racketeering, bank larceny and bank fraud, is awaiting sentencing.
The government’s case is being prosecuted by Assistant United States Attorneys Allon Lifshitz and Robert T. Polemeni.
The Defendants
JOSEPH SCLAFANI, also known as “Joe Boy”
Age: 47NEIL LOMBARDO
Age: 57Two Defendants Plead Guilty in Manhattan Federal Court to Participating in GamblingRings Connected to Organized CrimeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that WILLIAM BARBALAT and KIRILL RAPOPORT pled guilty for their roles in the operation of high-stakes illegal poker games in New York City. BARBALAT pled guilty on August 14, 2013 before U.S. District Court Judge Jesse M. Furman to traveling in interstate commerce in aid of an unlawful activity, the operation of an illegal poker game. RAPOPORT pled guilty today before Judge Furman to conducting an illegal gambling business, an illegal poker game.
Manhattan U.S. Attorney Preet Bharara said: “For three years, William Barbalat and Kirill Rapoport oversaw illegal gambling enterprises in the Southern District of New York. With their pleas, we move closer to holding to account all those who participated in this wide-ranging network of criminal conduct linked to organized crime.”
BARBALAT and RAPOPORT were charged in April 2013 in a 34-defendant indictment charging members and associates of two Russian-American organized crime enterprises with various crimes including racketeering, money laundering, extortion, and various gambling offenses.
According to the Indictment, a superseding information filed against RAPOPORT, other documents filed in this case, and statements made at various conferences in this case:
BARBALAT and RAPOPORT each ran a high-stakes illegal poker game in New York City from 2010 through 2012, and 2012 through 2013, respectively. At these games, the pots frequently reached tens of thousands of dollars or more. The operators of these games, including BARBALAT and RAPOPORT, collected percentages of the pots known as “rakes.” Each of the poker games employed at least five or more people to assist with the operation of the games, payments of debts, and collection of debts.
BARBALAT and RAPOPORT each face a maximum sentence of five years in prison and three years of supervised release. As part of his plea agreement, BARBALAT agreed to forfeit $150,000 to the United States. RAPOPORT agreed to forfeit $250,000 to the United States. BARBALAT and RAPOPORT are scheduled to be sentenced by Judge Furman on December 16, 2013 at 3:30 p.m. and December 18, 2013 at 3:00 p.m., respectively.
BARBALAT and RAPOPORT are the second and third defendants to plead guilty in the case. Bryan Zuriff pled guilty on July 26, 2013 and is scheduled to be sentenced by Judge Furman on November 25, 2013 at 3:00 p.m.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation, the New York City Police Department, and Internal Revenue Service, Criminal Investigation.
The case is being prosecuted by the Office’s Organized Crime Unit. Assistant U.S. Attorneys Harris M. Fischman, Joshua A. Naftalis, Peter Skinner, and Kristy J. Greenberg of the Organized Crime Unit are in charge of the prosecution. Assistant U.S. Attorneys Alexander Wilson and Christine Magdo of the Office’s Asset Forfeiture Unit are responsible for the forfeiture aspects of the case.
U.S. v. Kirill Rapoport S1 Information
U.S. v. Alimzhan Tokhtakhounov et al. IndictmentToledo Woman Charged with Human TraffickingRead the Press Release
A criminal information was filed today charging Toledo woman with interstate sex trafficking involving a minor, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland Office.
Amber Ginter, aka Amber Mendoza, age 35, is accused of transporting a minor from Ohio to Michigan in December 2009 with the purpose that the minor engage in commercial sexual activity, according to the information.
“This case is another stark reminder that human trafficking exists in our district and in our collective back yard,” Dettelbach said. “It’s a reminder that we need to be better neighbors and ask questions if something looks suspicious.”
Anthony said: “The sexual human trafficking of minors for profit is an injustice that will not be tolerated. The FBI continues to aggressively pursue and bring to justice those who violate the rights of our most vulnerable of the community.”
This case is being prosecuted by Assistant U.S. Attorney James V. Moroney, following an investigation by the Toledo Resident Agency of the FBI and the Northwest Ohio Violent Crimes Against Children Task Force. The task force is made up of members of the FBI, Toledo Police Department, Perrysburg Township Police Department, Lima Police Department, Oregon Police Department, Fulton County Sheriff’s Office, Ottawa County Sheriff’s Office, Ohio State Highway Patrol and the Bureau of Criminal Investigation.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Three Sentenced in Major Drug Conspiracy & Money Laundering RingRead the Press Release
On June 3, 2013, Rosalina Gonzalez was sentenced by Chief Judge Laurie Smith Camp for Conspiracy to Distribute 500 grams or more of methamphetamine mixture and Money Laundering. She will serve a term of 135 months in prison for both charges to be served concurrently. In addition, she was sentenced to a term of Supervised Release of 5 years on the drug conspiracy charges and 3 years on the money laundering charges.
On August 12, 2013, Jose Flores-Garcia was sentenced by Chief Judge Laurie Smith Camp for Conspiracy to Distribute 500 grams or more of methamphetamine mixture and Money Laundering. He will serve a term of 210 months for the drug conspiracy and 210 months for the money laundering charge to be served concurrently, a term of Supervised Release of 5 years on the drug conspiracy charge and 3 years on the money laundering charges.
On August 12, 2013, Jorge Luis Flores Contreras was sentenced by Chief Judge Laurie Smith Camp for Conspiracy to Distribute 500 grams or more methamphetamine mixture and Money Laundering. He will serve a term of 108 months for the drug conspiracy and 108 months for the money laundering charge to be served concurrently, a term of Supervised Release 5 years for the drug conspiracy charges and 3 years on the money laundering charges.
The case involved wiretaps and an informant jointly handled by the Bellevue and Omaha Police Departments, the Internal Revenue Service, the Federal Bureau of Investigation and the Drug Enforcement.
Three Randolph County Residents Charged with Methamphetamine ConspiracyRead the Press Release
Three Randolph County residents were indicted on August 6, 2013, on charges of conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Stephen P. Salzwedel, a/k/a “Steak,” 40, Tony G. Carle, 26, and Amber M. Calbreath, a/k/a “Amber Wehrman,” 31, all of Tilden, IL, are charged with conspiracy to manufacture methamphetamine. The indictment alleges that the offense occurred between 2012 and April 2013, in Perry, Jackson and Randolph Counties. The three co-defendants made their initial appearances in United States District Court in Benton on August 12, 2013. At an August 15, 2013, hearing, they were ordered held without bond pending an October 15, 2013, jury trial.
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.
If convicted, Salzwedel, Carle, and Calbreath face a term of imprisonment of up to 20 years, a $1,000,000 fine, and 3 years of supervised release.
The ongoing investigation is being conducted by the Randolph County Sheriff’s Office, Jackson County Sheriff’s Office, Perry County Sheriff’s Office, Illinois State Police Methamphetamine Response Team, and Drug Enforcement Administration. The Randolph County State’s Attorney’s Office also assisted in the investigation.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Theodore Edward Whitford, Jr. Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on August 15, 2013, before Chief U.S. District Judge Dana L. Christensen, THEODORE EDWARD WHITFORD, JR., a 27-year-old resident of Box Elder and an enrolled member of the federally recognized Chippewa Cree Indian Tribe, was sentenced to a term of:
- Prison: 20 months
- Special Assessment: $100.00
- Supervised Release: 3 years
WHITFORD was sentenced in connection with his guilty plea to assault resulting in serious bodily injury.
In an Offer of Proof filed by Assistant U.S. Attorney Danna R. Jackson, the government stated it would have proved at trial the following:
On April 8, 2011, WHITFORD turned the vehicle he was driving west into the Northern Winz Casino parking lot and was struck by another vehicle traveling north on Highway 87. This vehicle had the right-of-way.
A toxicology report indicated that WHITFORD had a BAC of .265 and screened positive for both opiates and THC. The crash occurred within the exterior boundaries of the Rocky Boy's Indian Reservation.
As a result of the crash, a passenger in the other vehicle was seriously injured. The passenger was diagnosed with a hip fracture and required hospitalization.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that WHITFORD will likely serve all of the time imposed by the court. In the federal system, WHITFORD does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was a cooperative effort between the Federal Bureau of Investigation, Hill County Sheriff's Office, and the Rocky Boy's Police Department.
Texas Businessman Admits to Stealing Millions from InvestorsRead the Press Release
SAN JOSE – Keven Chen Chieh Yang pleaded guilty in federal court in San Jose yesterday to defrauding millions from investors of his West Texas cotton businesses, United States Attorney Melinda Haag announced.
In pleading guilty, Yang admitted to making false, material statements causing several people to invest more than $5,000,000 in “cotton recycling businesses” located in the Lubbock, Texas area. Yang’s companies included WestCal, Triangle SuperGin, and OK Sourcing, among others. The investors resided in California, North Carolina, and China, among other places. Yang promised to invest the money in the businesses. Rather than doing so, however, Yang spent millions at casinos and diverted funds to offshore accounts.
Yang, 42, a citizen of Taiwan, Republic of China, and a former resident of Roland Heights, California, was indicted by a federal Grand Jury on July 13, 2011. He was charged with seven counts of wire fraud, in violation of 18 U.S.C. § 1343. Under the plea agreement, Yang pleaded guilty to three counts of wire fraud. Yang is currently in custody in San Jose.
Yang’s sentencing hearing is scheduled for November 12, 2013, before The Honorable Ronald M. Whyte, U.S. District Court Judge, in San Jose. The maximum statutory penalty for each count in violation of 18 U.S.C. § 1343, is 20 years imprisonment. Yang also agrees to pay restitution to the victims in an amount not less than $3,444,000, as determined by the Court. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Daniel Kaleba and Special Assistant U.S. Attorney Edward Fluet are prosecuting the case with the assistance of Nina Burney and Lakisha Holliman. The prosecution is the result of an investigation by the Federal Bureau of Investigation.
Tarrant County Man Sentenced to 78 Months in Federal Prison for Possessing Child PornographyRead the Press Release
Defendant Had Flash Drive Containing Numerous Images and Videos of Child Pornography in Pants Pocket When Arrested for Traffic Violation
FORT WORTH, Texas — Kenneth David Greer, 42, of North Richland Hills, Texas, was sentenced today by U.S. District Judge John McBryde to 78 months in federal prison following his guilty plea in March 2013 to one count of possession of child pornography. Greer has been in custody since his arrest in February 2013. The announcement was made today by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, an officer with the Bedford Police Department stopped Greer when he ran a stop sign in January 2013. He had no driver’s license and a search incident to his arrest led to the discovery of a flash drive in his pants pocket that was found to contain numerous images and videos of child pornography.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The case was investigated by the Bedford Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney A. Saleem prosecuted.
Tallahassee Man Sentenced to 10 Years in Federal Prison for Possession of Child PornographyRead the Press Release
TALLAHASSEE B Phillip Wayne Mathenia, 63, of Tallahassee, was sentenced yesterday to serve 120 months in federal prison, after pleading guilty on May 10, 2013, to one count of possession of child pornography. The result of the sentencing hearing was announced today by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
In 2004, Mathenia was convicted of receiving and possessing child pornography and was sentenced to serve 96 months imprisonment, followed by three years of supervised release. After his release from federal prison, Mathenia was again found in possession of child pornography in October 2012, during a search of his residence conducted by the United States Probation Office. Mathenia possessed hundreds of images of child pornography contained in several computers as well as in books, magazines, and 8 millimeter films that appeared to be decades old. Investigators also found written stories describing adults performing sex acts on children. Mathenia also possessed thousands of computer generated images and cartoon drawings depicting children and infants engaged in sexual activity, including child rape, bondage, torture, and bestiality.
Because of his prior conviction, Mathenia was sentenced to serve a mandatory minimum term of 10 years. He was also sentenced to eight months of incarceration on a violation of supervised release. After his release from federal prison, Mathenia will be placed on supervised release for the rest of his life.
United States Attorney Marsh praised the United States Probation Office, agents of the U.S. Immigration and Customs Enforcement’s Homeland Security and Investigations, and the Leon County Sheriff’s Office Internet Crimes Against Children, Computer Forensics/Digital Evidence Recovery Unit for their hard work, dedication and expertise in the investigation and prosecution of this case.
Marsh said, "Protecting our children from the permanent scars left behind when this kind of exploitation occurs is critically important work of the Department of Justice and this Office. This prison sentence should send a strong message of deterrence, and also provides security and justice for the victims of these crimes.”
This case was brought as part of Project Safe Childhood, a nationwide initiative launched by the Department of Justice in May 2006 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 provides federal, state, and local resources to 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.projectsafechildhood.gov.
The case was prosecuted by Assistant U.S. Attorney Corey J. Smith.
Swiss Lawyer Pleads Guilty in Manhattan Federal Court to Conspiring with U.S. Taxpayers to Evade Federal Income Taxes and File False Tax ReturnsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York,
announced that EDGAR PALTZER, a former partner at a Swiss law firm (the “Swiss Law Firm”), pled guilty today in Manhattan federal court to conspiring with U.S. taxpayer-clients and others to help U.S. taxpayers hide millions of dollars in offshore accounts from the IRS, and to evade U.S. taxes on the income earned in those accounts. PALTZER, who was originally charged in April 2013 along with his co-defendant Stefan Buck, was arrested at John F. Kennedy Airport in August 2013. He pled guilty before U.S. Magistrate Judge Ronald L. Ellis.
According to the Superseding Information, the Indictment, statements made during the plea proceeding, and other documents filed in Manhattan federal court:
PALTZER is a U.S.-trained lawyer who began to practice at the Swiss Law Firm in 1998, in the fields of international private client work, wealth transfer planning, successions, trusts and foundations, and eventually became a partner. PALTZER is also licensed to practice in New York State.
United States taxpayers are required to report on their individual tax returns the existence of any foreign bank account that holds more than $10,000 at any time during a given year, as well as any income earned in such accounts.
PALTZER conspired with various U.S. taxpayers and others to ensure that their clients could hide their Swiss bank accounts and the income generated in them from the IRS. PALTZER, acting as a financial intermediary, helped U.S. taxpayers maintain undeclared assets in Swiss banks by, among other things, working with these U.S. taxpayers to create and maintain sham foundations and other entities to nominally hold the U.S. taxpayers’ accounts in Swiss banks. When certain Swiss banks required that these U.S. taxpayers close their accounts, PALTZER worked with these U.S. taxpayers and others to move their accounts to other Swiss banks that were still willing to maintain accounts for U.S. taxpayers with undeclared assets.
PALTZER also helped to repatriate funds to the U.S. taxpayers from their undeclared accounts in Switzerland in ways that were designed to ensure that U.S. authorities would not discover these undeclared accounts. For example, PALTZER helped a U.S. taxpayer repatriate assets in the form of jewelry in order to avoid detection of an account in Switzerland.
PALTZER, 56, a dual U.S.-Swiss citizen, pled guilty pursuant to a plea agreement to one count of conspiracy charging him with conspiring with U.S. taxpayers and others to evade federal income taxes and file false tax returns. He faces a maximum sentence of five years in prison, and is scheduled to be sentenced before U.S. District Judge Victor Marrero on February 21, 2014.
Buck, PALTZER’s co-defendant, has not been arrested and remains at large. The charges against Buck are merely accusations and he is presumed innocent unless and until proven guilty.
Mr. Bharara praised the outstanding investigative work of the Internal Revenue Service, Criminal Investigation. He also thanked the Department of Justice’s Tax Division for their significant assistance in the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Jason H. Cowley, Daniel W. Levy, David Massey, Sarah Paul, and Sarah McCallum are in charge of the prosecution.
U.S. v. Edgar Paltzer S1 Information
Sioux Falls Man Pleads Guilty to Failure to Register as A Sex OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that David Flute III, age 23, of Sioux Falls, South Dakota, appeared before U.S. District Judge Roberto A. Lange on August 13, 2013, and pled guilty to Failure to Register as a Sex Offender. This was Flute’s second conviction for failure to register.
The maximum penalty upon conviction is 10 years of imprisonment, a $250,000 fine, or both; at least 5 years of supervised release, with a violation of a condition of release possibly resulting in 2 years of additional incarceration on any such revocation; a mandatory $100 special assessment to the Federal Crime Victims Fund; and restitution may also be ordered. If Flute commits a new felony violation of sexual abuse, sexual exploitation and other abuse of children, transportation for illegal sexual activity and related crimes, kidnapping or sex trafficking of children by force, fraud or coercion while on supervised release, he may be incarcerated for a mandatory minimum term of 5 years up to life for each violation.
Flute was previously convicted of Aggravated Sexual Abuse of a Child, which required him to register as a sex offender for life in the State of South Dakota.
On November 18, 2011, Flute was convicted of Failure to Register as a Sex Offender in U.S. District Court, District of South Dakota. Following his release from custody, he signed registration documents and updated his registration, as required by law. On April 10, 2013, Flute was terminated from his apartment and moved to another location. Between April 13, 2013 and May 17, 2013, Flute, did knowingly fail to register and update his registration as required by law, leading to his second conviction.
The investigation was being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Flute was remanded to the custody of the U.S. Marshals Service pending sentencing which has been set for October 9, 2013.Rochester Man Sentenced for Stealing Interstate Shipment from Rail CarRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Anthony J. Russell, 39, of Rochester, N.Y., who was convicted following a jury trial of conspiracy to steal an interstate shipment and theft of an interstate shipment, was sentenced to 15 months in prison and ordered to pay $4,669.26 in restitution by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Brett A. Harvey, who handled the case, stated that on June 30, 2009, Russell, along with co-conspirators Richard E. Riedman, Anthony Toscano and Timothy Stone, stole more than 17 gross tons of a high-grade scrap steel from a railcar at a CSXT rail yard in Batavia, N.Y. Russell and his co-conspirators used a logging truck to remove the scrap steel from the railcar, wore dark clothing and used lookouts to avoid detection by law enforcement authorities and pedestrians, and used two-way radios to communicate with each other during the theft. The defendant and his co-conspirators were caught by members of the Genesee County Sheriff's Office in the logging truck and a pick-up truck as they left the scene of the theft in the early morning hours of June 30, 2009.
The bales were in the process of being shipped to a steel mill in Pennsylvania when Russell and his co-conspirators stole them. The defendant along with Riedman, Toscano and Stone were convicted after a two-week jury trial before Judge Siragusa in September 2012.
Judge Siragusa previously sentenced Toscano and Stone to 18 months and 12 months in prison respectively. Riedman is scheduled to be sentenced by Judge Siragusa on September 16, 2013.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Acting Special Agent in Charge Richard M. Frankel, and the Genesee County Sheriff's Office, under the direction of Sheriff Gary Maha.Rochester Man Indicted in Tax SchemeRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury in Rochester has returned a 117-count indictment charging Norman Perry, 50, of Rochester, N.Y., with mail fraud, aggravated identity theft and making false claims to the United States. The mail fraud charges carry a maximum penalty of 20 years in prison, making a false claim to the United States carries a maximum of five years in prison and aggravated identity theft carries a mandatory term of two years in prison, to be served consecutive to any other term of imprisonment. All of the charges also carry a fine of $250,000, or both.
Assistant U.S. Attorney Marisa J. Miller, who is handling the case, stated that according to the indictment, the defendant posted advertisements in Rochester claiming that he could find lost or unclaimed funds. Individuals then provided Perry with their name, address and social security number and agreed to pay the defendant a fee, generally in the amount of $300, for each $1,000 check they received. In reality, Perry used the individuals information to prepare and file approximately 1,200 false and fraudulent tax returns with the Internal Revenue Service claiming refunds in excess of $1,000,000. The defendant stated that the individuals had qualified educational expenditures and were entitled to receive the American Opportunity Credit, a refundable tax credit for educational expenses. None of the individuals were students, none had incurred any educational expenditures and none provided such information to Perry.
The Indictment is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service - Criminal Investigation, under the direction of Special Agent In Charge Toni Weirauch.
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.Rapid City Man Sentenced for Not Updating Sexual Offender RegistrationRead the Press Release
United States Attorney Brendan V. Johnson announced that a Box Elder, South Dakota, man convicted of Failure to Register was sentenced on August 13, 2013, by Chief Judge Jeffrey L. Viken, U.S. District Court.
Seth Peter Between Lodges, age 31, was sentenced to 12 months and 1 day of imprisonment, 5 years of supervised release, and was ordered to pay $100 to the Federal Crime Victims Fund.
From July 24, 2012, to November 19, 2012, Between Lodges failed to update his sexual offender registration as required. He pled guilty on March 28, 2013.
This case was investigated by the U.S. Marshals Service. Assistant U.S. Attorney Sarah B. Collins prosecuted the case.Planned Parenthood Pays $4.3 Million to Settle Allegations of Unnecessary Medical CareRead the Press Release
Department of Justice
Office of Public AffairsLUFKIN, Texas – Houston-based Planned Parenthood Gulf Coast has paid $4.3 million to resolve civil allegations under the False Claims Act in the Eastern District of Texas, announced U.S. Attorney John M. Bales.
The government alleges that between 2003 and 2009, Planned Parenthood Gulf Coast billed and was paid by government programs, Texas Medicaid, Title XX, and the Women’s Health Program, for certain items and services related to birth control counseling, STD testing and contraceptives when such items and services were either not medically necessary, not medically indicated or not actually provided. Title XX is funded by the federal government while Texas Medicaid and the Women’s Health Program are funded jointly by the federal government and the State of Texas.
Of the $4.3 million settlement, the federal government will receive $3,594,604 and the State of Texas will receive $705,396. The settlement resolves a False Claims Act lawsuit filed in the Eastern District of Texas by Karen Reynolds, a former employee of Planned Parenthood Gulf Coast. The whistleblower or qui tam provisions of the False Claims Act permit the relator to obtain a portion of the proceeds obtained by the government. As part of today’s resolution, Reynolds will receive $1,247,000.
“We are very pleased to settle this matter for an amount of money that addresses what was, in the Government’s view, an abuse of programs that are extremely important to the well-being of many American women,” said U.S. Attorney Bales. “We will remain ever vigilant to protect the interests of American taxpayers and the integrity of the Medicare and Medicaid health programs. I am particularly grateful to the whistleblower for bringing the matter to our attention.”
The claims settled by this agreement are allegations only; there has been no determination of liability.
This case was investigated by the Texas Attorney General’s Civil Medicaid Fraud Division and prosecuted by Assistant U.S. Attorney Kevin McClendon.
New Jersey Man Pleads Not Guilty to Transporting Minor to Engage in Criminal Sexual ActivityRead the Press Release
PROVIDENCE, R.I. – Daniel Berger, 27, of Haskell, New Jersey, pleaded not guilty in U.S. District Court in Providence, R.I., today to a federal indictment charging him with one count of transportation of a minor with intent to engage in criminal sexual activity, announced United States Attorney Peter F. Neronha; Vincent B. Lisi, Special Agent in Charge of the Boston Field Office of the FBI; Portsmouth, R.I., Acting Police Chief Jeffrey Furtado; and Colonel Steven G. O’DonnellSuperintendent of the Rhode Island State Police.
According to information presented to the court, it is alleged that on July 24, 2013, Berger traveled from New Jersey to Rhode Island to meet with a minor female he befriended on the Internet. It is alleged that the defendant transported the minor to his residence in Haskell, New Jersey, with the intent to engage in criminal sexual activity.
Responding to an Amber Alert issued in Rhode Island for the young girl, local, state and federal law enforcement in Rhode Island and New Jersey worked collaboratively and located the victim in New Jersey. FBI agents from Newark assisted by local and state law enforcement officers recovered the victim shortly after midnight at Berger’s residence.
Berger was detained in New Jersey on a federal criminal complaint issued in the District of Rhode Island on a charge of transportation of a minor with intent to engage in criminal sexual activity. He was transported to Rhode Island on July 29, 2013, by the United States Marshals Service and was ordered detained following an initial appearance on July 30, 2013, in U.S. District Court in Providence.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt. If convicted of transportation of a minor with intent to engage in criminal sexual activity, Berger faces statutory penalties of 10 years to life in federal prison, up to 5 years of supervised release and a fine of up to $250,000.
The case is being prosecuted by Assistant United States Attorneys Stephen G. Dambruch and Milind M. Shah.Portsmouth Police, Rhode Island State Police and FBI agents from Providence and Newark, N.J., were assisted by the New Jersey State Police and officers from the Ringwood, Wanaque, Paterson and Clifton, New Jersey, Police Departments.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]McLaughlin Man Sentenced for Lacey Act ViolationsRead the Press Release
United States Attorney Brendan V. Johnson announced that a McLaughlin, South Dakota, man convicted of Lacey Act Violations was sentenced on August 12, 2013, by U.S. District Judge Charles B. Kornmann.
The investigation was being conducted by the U.S. Fish & Wildlife Service. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Jeffrey Volk, age 43, was sentenced to 3 years of unsupervised probation, $2,000 in restitution, $1,000 fine with $750 due at sentencing, and a $25 special assessment to the Federal Crime Victims Fund. Volk’s hunting privileges were also revoked for 3 years.
Volk was charged by an Information on February 14, 2013, and pled guilty to said Information on May 9, 2013.
The charge stems from an incident in November 2008 wherein Volk illegally shot and killed an 8x6 mule deer in North Dakota. At the time Volk killed the deer, he knowingly did not have a North Dakota or a Standing Rock Sioux Tribe deer hunting license. After illegally killing the deer, Volk transported it into South Dakota in violation of state and federal laws. Volk also admitted to killing one other deer in North Dakota and transporting it into South Dakota.Mason City Bank Teller Pleads Guilty to EmbezzlementRead the Press Release
A woman who embezzled nearly $70,000 from a Mason City bank pled guilty today in federal court in Cedar Rapids.
Margaret Marie (Peggy) Sheese, age 53, from Mason City, Iowa, was convicted of one count of embezzlement by a bank employee.
In a plea agreement, Sheese admitted that, between about October 2011 and January 2013, she stole $69,200 from Northwood State Bank in Mason City. At the time, Sheese was a teller at the bank. Sheese admitted making twenty-nine secret withdrawals from accounts belonging to a particular bank customer. Sheese altered the bank’s records to falsely show that the bank customer’s mailing address had changed to a Post Office Box under Sheese’s control. By changing the mailing address, Sheese caused the bank to send the customer’s account statements to Sheese rather than to the customer.
Sheese also admitted that, on January 15, 2013, she stole $2,000 in cash from the bank.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Sheese remains free on bond pending sentencing. Sheese faces a possible maximum sentence of thirty years’ imprisonment, a $1,000,000 fine, and five years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Peter Deegan and was investigated by the Mason City Police Department and the Federal Bureau of Investigation.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-3026 LRR.
Mark Edwin Abresch Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on August 16, 2013, before U.S. District Judge Dana L. Christensen, MARK EDWIN ABRESCH, a 54-year-old resident of Great Falls, was sentenced to a term of:
- Prison: 72 months
- Special Assessment: $100.00
- Supervised Release: 5 years
ABRESCH was sentenced in connection with his guilty plea to conspiracy to possess with the intent to distribute methamphetamine.
In an Offer of Proof filed by Assistant U.S. Attorney Jessica A. Betley, the government stated it would have proved at trial the following:
During January 2012, law enforcement was alerted to a methamphetamine distribution ring from Washington state to Great Falls.
In June 2012, detectives learned that ABRESCH made repeated trips from Great Falls to Washington to obtain methamphetamine to re-sell in Great Falls.
On June 29, 2012, a CI (confidential informant) informed the drug task force that ABRESCH was returning to Great Falls from Washington with methamphetamine. The task force arranged for a controlled drug buy from ABRESCH in Great Falls. The CI purchased methamphetamine. The CI then continued to make numerous controlled drug buys from ABRESCH over the next few days.
Law enforcement located ABRESCH's car in early July 2012 and the task force tracked his car from Great Falls to Spokane, Washington. The car stayed in Spokane for less than two hours before returning to Great Falls. Law enforcement initiated a traffic stop of the car just outside of Great Falls and they obtained two ounces of methamphetamine from ABRESCH. He then told law enforcement he had traveled to Spokane to buy methamphetamine from "Bert." He had been supplied by Bert, who was identified as Robert Boucher, since February or March 2012. In total, ABRESCH believed he had obtained and distributed approximately ten ounces of methamphetamine that he received from Boucher.
ABRESCH told law enforcement that Boucher provided him with a GPS system in order for him to find Boucher's house in Spokane. Once ABRESCH obtained the methamphetamine from Boucher, he would sell the methamphetamine by the gram for $100 around Great Falls. Boucher sold the methamphetamine to ABRESCH for $1,400 per ounce.
ABRESCH and Boucher also dealt methamphetamine with Ron Leeson and Tammy Lapie from Lapie's house in Great Falls. The methamphetamine dealing continued into the fall of 2012.
Robert Boucher, Ron Leeson, and Tammy Lapie pled guilty to federal charges.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that ABRESCH will likely serve all of the time imposed by the court. In the federal system, ABRESCH 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 High Intensity Drug Trafficking Area (HIDTA) Task Force - Russell County Drug Task Force.
Manhattan U.S. Attorney Announces Forfeiture of Chinatown Building That Housed Illegal Gambling OperationsRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today the settlement of a civil forfeiture action against a six-story Chinatown building, appraised at approximately $17 million, located at 35-37 East Broadway (the “Building”) in New York City. The settlement between the United States and the owner of the Building, Won & Har Realty Corporation (“Won & Har”) followed a ruling, by U.S. District Judge Harold Baer, Jr., that the Building was subject to forfeiture because it had been used in furtherance of illegal gambling and Won & Har was not an innocent owner. Judge Baer also approved today’s settlement.
According to public documents filed in Manhattan federal court:
For at least the two years prior to the filing of a civil forfeiture complaint in May 2012, the Building consistently hosted a group of illegal gambling operators offering various gambling options, including pai gow poker and computer-based slot machine games. For nearly a year after a search conducted by law enforcement in 2011, which resulted in the seizure of hundreds of thousands of dollars in gambling proceeds, illegal gambling continued to be conducted openly in the Building, within full view of any passersby in the Building’s public hallways. In addition, a large sign advertising gambling was displayed on the front of the Building.
In its ruling, the Court rejected Won & Har’s “innocent owner” defense, finding that despite Won & Har’s knowledge of the ongoing gambling in the Building, the company failed to take all reasonable steps to terminate the illegal conduct. The Court cited Won & Har’s failure to investigate whether gambling was continuing in the Building in drawing the conclusion that Won & Har was willfully blind to the illegal use of its Building.
Pursuant to the terms of the agreement, Won & Har will forfeit the Building to the United States. The United States will sell the Building, retain 65% of the proceeds of the sale after accounting for the costs of selling the Building, and return the remainder of the proceeds to Won & Har.
Mr. Bharara praised the efforts of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) New York Asset Identification and Removal Group, HSI New York’s Gang Unit, the New York City Police Department’s (NYPD) Manhattan Vice Unit, NYPD’s Asset Forfeiture Unit, and U.S. Customs and Border Protection’s Air Unit. He also thanked the New York County District Attorney’s Office for their assistance.
Assistant United States Attorneys Alexander J. Wilson and Christine I. Magdo are in charge of the civil forfeiture action.
U.S. v. 35-37 Settlement PR Stipulation and Order of Settlement
Man Indicted on Drug ChargesRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Wesley White, also known as “Westside,” age 38, of Valdosta, Georgia was indicted on August 14, 2013, by the federal grand jury for the offenses of Possession with Intent to Distribute Cocaine Base (crack cocaine), Possession with Intent to Distribute Cocaine, and Possession with Intent to Distribute Marijuana.
If convicted, Mr. White faces ten (10) years to life in prison on the charge of Possession with Intent to Distribute Crack with a possible fine of $8,000,000; up to thirty (30) years in prison and a $2,000,000 fine for the offense of Possession With Intent to Distribute Cocaine; and up to (10) years in prison and a $500,000 fine for the offense of Possession With Intent to Distribute Marijuana.
An indictment is only an accusation, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt at trial.
The case was investigated by the Federal Bureau of Investigation Southwest Georgia Gang Task Force, made up of officers and agents of the FBI, Lowndes County Sheriff’s Office, Valdosta Police Department, Colquitt County Sheriff’s Office, Moultrie Police Department, and
Thomasville Police Department. The case is being prosecuted by Assistant United States Attorney Robert D. McCullers.Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Louis Michael Healy Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on August 15, 2013, before Chief U.S. District Judge Dana L. Christensen, LOUIS MICHAEL HEALY, a 40-year-old resident of Hays and an enrolled member of the Fort Belknap Tribes, was sentenced to a term of:
- Prison: 327 months
- Special Assessment: $300.00
- Supervised Release: 20 years
HEALY was sentenced after a federal district court trial in which he was found guilty of assault resulting in serious bodily injury, aggravated sexual abuse, and abusive sexual contact.
At trial, the following evidence and testimony was presented to the jury.
On October 13, 2012, the victim drove HEALY to the store where he bought several black cans of Smirnoff. After leaving the store, the victim drank a little from a can, and HEALY drank one can very quickly. They drove to a hill where HEALY drank two or three more cans of Smirnoff. The victim drank an additional can. HEALY then asked the victim to marry him. The victim replied that she would not marry HEALY unless he could prove he had ceased speaking with his ex-girlfriend.
HEALY and the victim returned to his home on the Fort Belknap Indian Reservation. They turned on HEALY's computer and the victim read e-mails that indicated HEALY was still speaking with his ex-girlfriend. The victim was sitting in a rolling computer chair. She became upset and HEALY grabbed her neck with his right hand and pushed her across the floor in the chair. Due to the force of the push, she crashed and hit her head. When she awoke, HEALY had his hand on her throat applying pressure. He then walked to the kitchen and grabbed a knife. HEALY stood over the victim, placed the knife to her throat, and told her to get up.
The victim began to cry, her throat hurt, and HEALY told her to get into the bedroom. He instructed her to lie down and said, "if you don't stop **** crying, you know what you're going to get and we both aren't coming out of the room, so stop **** crying." At that point, the victim believed HEALY was going to kill her. The victim continued to complain that her throat hurt so HEALY went to the kitchen where he returned with water and a popsicle. She then began to vomit due to the drinking or strangulation she had experienced. According to the victim, she spoke with HEALY for a little bit while sitting on the bed until HEALY grabbed her and sexually assaulted her while she continued to tell him to stop. HEALY then told the victim to get back on the computer and instructed her to tell his ex-girlfriend that the victim was going to leave her alone.
HEALY went to the bathroom after this instruction. The victim decided this was her chance to escape and she ran out of the house to the next door neighbor's home. HEALY realized the victim had run away and he chased after her, but she got inside the neighbor's home safely.
The neighbors testified that they had awoken at approximately 4:00 a.m. to someone pounding on the door. The victim was at the door very upset and trying to get inside. The victim was crying and saying her boyfriend was trying to kill her. He had held a knife to her throat and she said, "he's going to kill me."
When law enforcement arrived at HEALY's home, HEALY was walking and carrying two black bags. HEALY was ordered to stop and HEALY turned around and yelled, "**** you." The police ordered HEALY to the ground and pepper sprayed him in an effort to subdue him.
An ambulance arrived and transported the victim to the hospital where a nurse immediately assessed that the victim had trouble swallowing due to strangulation. The nurse noted the left side of the victim's throat had a few areas of linear petechial, which is bruising around the throat. She applied ice and the victim told the nurse she was sexually assaulted and strangled. The hospital also performed a sexual assault examination. The victim ended up returning to the hospital a few days later due to continued throat pain and inability to swallow.
Assistant U.S. Attorney Jessica A. Betley prosecuted the case for the United States.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that HEALY will likely serve all of the time imposed by the court. In the federal system, HEALY does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Federal Bureau of Investigation.
Last Defendant in Operation Spitter Is Sentenced to 8 Years in Federal Prison for Distribution of Heroin and CocaineRead the Press Release
DENVER – Elder Geovany Sabillon-Umana, age 43, of Denver, Colorado was sentenced by U.S. District Court Judge Wiley Y. Daniel to serve 96 months (8 years) in federal prison for conspiracy to distribute heroin and cocaine, and money laundering, federal and state authorities announced. Following his prison sentencing, Umana was ordered to spend 5 years on supervised release. Umana pled guilty to the above charges on October 23, 2012. Other key co-conspirators of “Operation Spitter” were sentenced by Judge Daniel and received the following sentences:
- Jose Lopez-Luna pled guilty to drug charges & money laundering and was sentenced to 192 months, followed by 5 years supervised release.
- Yoni Dimar Mas-Cruz pled guilty to drug charges and was sentenced to 72 months, followed by 5 years supervised release.
- Nandi Evelio Arrazola pled guilty to drug charges and was sentenced to 70 months, followed by 5 years supervised release.
- Elvin Eduardo Cruz-Cruz pled guilty to drug charges and was sentenced to 48 months, followed by 5 years supervised release.
- Corina Terrones was indicted on drug charges and money laundering and is currently a fugitive.
According to the statement of facts contained in Umana’s plea agreement, investigators from the Front Range Task Force (FRTF) which included DEA and IRS CI agents conducted an investigation into the Jose Lopez- Luna, aka Gordo, drug distribution organization (DTO) since approximately June 2011. The Gordo DTO is responsible for the distribution of multi-pound quantities of heroin and cocaine in the Denver metropolitan area. The investigation led investigators to Umana, an active narcotics customer and narcotics sub-distributor for the Gordo DTO.
From July 2011 through April 2012, the investigation disclosed Umana distributed narcotics and assisted the Gordo DTO by arranging or providing the means of transportation of drugs, advising Jose Lopez-Luna in the narcotics business, preparing documents for DTO automobile registration and insurance, assisting with acquisition of mobile phones, smart phones and services, assisting with Jose Lopez-Luna's housing, offering to obtain a firearm for Jose Lopez-Luna, and sometimes sourcing the Gordo DTO with cocaine drug supplies obtained from another DTO.
In late spring of 2011 the FRTF investigators began their investigation by making controlled purchases of heroin from lower level traffickers including Yoni Dimar Mas-Cruz. Investigators conducting surveillance determined that the person eventually identified as Jose Lopez-Luna was the source of the drug supply. The street level distributors are sometimes called “Spitters” because they keep balloons of heroin in their cheeks and spit them out into their hands when, for example, a customer comes to buy a $20 rock of heroin, giving the OCDETF case name “Operation Spitter.”
Searches conducted in April of 2012 resulted in the recovery of vehicles, more than 20 ounces of heroin, a quantity of cocaine, and approximately one pound of methamphetamine, cell phones, drug proceeds in the form of cash, and one firearm. Over the course of the investigation 2,101 grams of heroin, 2,383 grams of cocaine and 445 grams of methamphetamine were seized by law enforcement officers.
This case was investigated by the Drug Enforcement Administration (DEA), IRS – Criminal Investigation Division, and the Front Range Task Force which includes members of the DPD and the Arapahoe County Sheriff’s Department.
The case was prosecuted by Assistant U.S. Attorney Guy Till of the U.S. Attorney’s Office.
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Kentucky Resident Charged with Tax Evasion and Other Tax Fraud ChargesRead the Press Release
WASHINGTON, DC - Kathryn Keneally, Assistant Attorney General of the Justice Department’s Tax Division, and Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, jointly announced today that James S. Faller II, of Russell Springs, Ky., was indicted by a federal grand jury in Bowling Green, Ky. Faller, a consultant and private investigator, is charged in an eleven count indictment with obstructing the internal revenue laws, evading his individual income taxes, making and subscribing to a false form that he filed with the Internal Revenue Service (IRS) and failing to file his individual income tax returns.
The indictment, returned on Wednesday, alleges that Faller obstructed the IRS’s ability to collect payment of a substantial penalty he owed to the government and the IRS’s ability to identify his income from 2006 through 2009. According to the indictment, Faller evaded the payment of a $216,000 penalty related to unpaid employment taxes of Call Center Communications Inc., of which Faller was the president. In addition, Faller was charged with evading his individual income taxes from 2006 through 2009. He allegedly failed to report more than $960,000 of income during this four-year period and committed various affirmative acts of evasion.
Faller faces a maximum punishment of three years in prison for the charge of obstructing the internal revenue laws; five years for each count of evading his individual income taxes; three years for making and subscribing to a false form that he filed with the IRS; and one year for each count of failing to file his individual income tax returns. He faces a maximum fine of $100,000 on each count of failing to file his income tax returns and $250,000 for each of the other counts. 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 resulted from an investigation by special agents of the IRS - Criminal Investigation. Tax Division Trial Attorney Thomas Voracek and Assistant U.S. Attorney Lee Gentry are prosecuting the case.
Jourden St. Marks Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on August 15, 2013, before Chief U.S. District Judge Dana L. Christensen, JOURDEN ST. MARKS, a 23-year-old resident of the Rocky Boy's Reservation and an enrolled member of the federally recognized Chippewa Cree Indian Tribe, was sentenced to a term of:
- Prison: 33 months
- Special Assessment: $100.00
- Supervised Release: 3 years
ST. MARKS was sentenced in connection with his guilty plea to assault resulting in serious bodily injury.
In an Offer of Proof filed by Assistant U.S. Attorney Danna R. Jackson, the government stated it would have proved at trial the following:
On January 1, 2013, ST. MARKS caused the victim, a 1-month old baby at the time, to incur serious injuries. ST. MARKS admitted that after trying to soothe the baby, he became frustrated with her and threw the baby at the end of the bed. According to ST. MARKS, the baby bounced off the pillows at the end of the bed and landed on the linoleum. The incident occurred within the exterior boundaries of the Rocky Boy's Indian Reservation.
As a result, the baby was transported to Northern Montana Hospital and then transported by Mercy transport to the pediatrics unit at Benefis Hospital in Great Falls. The infant suffered severe swelling to the face, her eyes were swollen and she had petchia on the eyes, around her nose, and inner portion of her ear. She had substantial bruising to the face, from the top of her sternum down to her belly button, on the right side of her rib cage. The infant's gums, tongue, and inner cheeks of her mouth were bruised. There was dried blood inside her mouth. A CT scan showed that her brain had bled. Her fingernails were bluish in color, indicating a lack of oxygenation.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that ST. MARKS will likely serve all of the time imposed by the court. In the federal system, ST. MARKS does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Federal Bureau of Investigation.
Jacksonville Man Pleads Guilty to Receipt of Child PornographyRead the Press Release
Jacksonville, FL - Acting United States Attorney A. Lee Bentley, III announced that Dwaine Charles Idleman (66, Jacksonville) pleaded guilty yesterday to receiving images and videos depicting child pornography over the Internet. He faces not less than 5 years, up to 20 years in federal prison, and a potential life term of supervised release. A sentencing date has not yet been set. Idleman was named in a criminal information charging him with the offense on August 5, 2013.
According to court documents, a special agent with U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) began an undercover operation to identify persons using the Internet to receive and share child pornography. The agent identified a particular host computer using a particular internet protocol (IP) address that was sharing images of child pornography on a file sharing network. Further investigation revealed that the subscriber was Dwaine C. Idleman in Jacksonville.
On June 28, 2012, HSI special agents and other law enforcement officers executed a federal search warrant at the Idleman residence in Jacksonville. Idleman was present, and agreed to speak with the agents. Idleman stated, among other things, that he had come across pornography sites with people that were “too young” but that he “got out of it.” Idleman stated that he had a particular file sharing program, but does not keep it installed on his computer. When told that the agents knew that he was downloading child pornography files into his residence and that he was sharing it back out of the residence, Idleman stated, “I’m not sharing it; I didn’t think I was, and I didn’t know that I was keeping it, I know I got a problem and if this escalates into an arrest, my life is over.”
While at Idleman's residence, the agents seized his laptop computer. Subsequent forensic analysis revealed that it contained at least four images and one video depicting child pornography. The analysis also showed Idleman downloaded child pornography on the morning of June 28, 2012, just before the arrival of law enforcement.
The case was investigated by HSI, and the Jacksonville Sheriff's Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
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.