Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
6 August 2013
Man Now Facing New Child Sex Trafficking Charges for ‘Pimping’ Minors Turned over to Federal Authorities and Is Due in Court TomorrowRead the Press Release
SANTA ANA, California – A 19-year-old South Los Angeles man is scheduled to appear in federal court Wednesday to face charges that accuse him of acting as a pimp for underage prostitutes whose services were advertised online.
Curtis Maurice Canady, 19, also known as “Cash,” was charged last week in a criminal complaint filed in United States District Court in Santa Ana with two counts of child sex trafficking.
Because the victims were between the ages of 14 and 18, Canady would face a mandatory minimum sentence of 10 years in federal prison if he is convicted of either count. The statutory maximum penalty for the offenses is life in federal prison.
After his arrest on July 25 as part of an FBI-led initiative called Operation “Cross Country,” Canady was charged by the Orange County District Attorney’s Office with two counts of human trafficking with the intent to pander, two counts of pandering a minor by procuring, and one count of attempted pimping. At a court appearance this morning in the Orange County Superior Court, the District Attorney’s Office agreed to Canady’s release from custody so he could be taken into federal custody. Canady is scheduled to appear in United States District Court in Santa Ana tomorrow at 2:00 p.m.
“As we focus our efforts on sex traffickers who prey upon young, vulnerable victims, we are developing new ways to identify the problem and deal with offenders,” United States Attorney André Birotte Jr. said. “This case demonstrates the value of collaborative law enforcement to most effectively bring justice to the victims of this most troubling offense.”
Officers with the Anaheim Police Department identified Canady as a trafficking suspect after interviewing victims who were working as prostitutes. Canady was subsequently arrested by members of the Orange County Child Exploitation Task Force during Operation Cross Country, which was conducted to identify sex trafficking rings and underage victims.
According to the federal complaint, Canady drove female prostitutes to Anaheim, including two girls who are 15 and 16. On July 25, task force investigators located one of the victims in a motel room in Los Angeles, and she not only admitted to working as a prostitute for Canady, she also said she accompanied Canady and another minor to Las Vegas, where they worked as prostitutes. During the investigation, investigators also identified one of the victims as the subject of an online advertisement for prostitution services in the Palmdale area.
“The U.S. Attorney and I will coordinate efforts to take these modern-day slave owners and human traffickers off the streets and prosecute them for the greatest possible punishment under the law for sexually exploiting children for their greedy purposes,” said Orange County District Attorney Tony Rackauckas.
FBI Assistant Director in Charge Bill Lewis stated: “The targeting of minors for prostitution is on the rise in the United States. Law enforcement and the community must work together to identify victims in our own backyards, and to end the cycle of oppression endured by our nation’s children, as well as adult victims, who may be forced into prostitution against their will.”
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until proven guilty in court.
The case against Canady is the result of an investigation by the Anaheim Police Department and the FBI.
Release No. 13-101
Lower Brule Man Sentenced for Assault with A Dangerous WeaponRead the Press Release
United States Attorney Brendan V. Johnson announced that a Lower Brule, South Dakota, man convicted of Assault with a Dangerous Weapon was sentenced on August 5, 2013, by U.S. District Judge Roberto A. Lange.
Irvin Yazzie, age 24, was sentenced to 17 months of imprisonment, 18 months of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Yazzie was indicted by a federal grand jury on March 13, 2013, and pled guilty to the above charge on April 30, 2013.
The charge stems from an incident wherein Yazzie and his girlfriend, who were staying at a residence in Lower Brule, began arguing about their relationship. During the course of the argument, Yazzie assaulted the victim by striking her with his fists and a black aluminum pole. The victim suffered bruising as a result of the assault.
The investigation was conducted by the Bureau of Indian Affairs. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Yazzie was immediately turned over to the custody of the U.S. Marshals Service.Leader of A Maryland Drug Ring and Two Conspirators Sentenced to PrisonRead the Press Release
Conspired to Distribute Over 1,500 Pounds of Marijuana and Launder Over $1 Million
Greenbelt, Maryland – Chief U.S. District Judge Deborah K. Chasanow sentenced Billymir Mancilla-Brevichet, age 28, of Oakland, California, today to 90 months in prison, followed by four years of supervised release, for conspiring to distribute more than 700 kilograms of marijuana and conspiring to commit money laundering. Chief Judge Chasanow also ordered that Mancilla forfeit $278,618 seized from May to October, 2012.
Yesterday, Chief Judge Chasanow sentenced co-conspirators Chamron Thach, a/k/a Sham, age 30, of Silver Spring, Maryland, and Carlos Salvador Escobar, a/k/a Esco, age 30, of Arlington, Virginia, to eight years and three years in prison, respectively, for their participation in the drug and money laundering conspiracies.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Chief J. Thomas Manger of the Montgomery County Police Department.
“This case underscores the teamwork between HSI and the Montgomery County Police Department in dismantling a drug trafficking and money laundering organization,” said William Winter, HSI special agent in charge in Baltimore. “HSI works aggressively to keep illegal drugs out of our communities, and to dismantle the criminal networks that profit from drug trafficking and the crime that surrounds it.”
According to their guilty ples and court documents, from March 2011 to December 2012, Mancilla acquired large amounts of high-quality marijuana from suppliers in California and elsewhere, and arranged for the transport of the marijuana by plane, car and mail to co-conspirators in Montgomery County, Maryland, including Chamron Thach. Mancilla’s co-conspirators transported at least 100 pounds of marijuana at a time by car to a storage facility in Maryland, where Mancilla arranged for co-conspirators, including Carlos Escobar, to pick up multiple pounds of marijuana for re-distribution. When the marijuana was delivered to Maryland, Thach became responsible for redistributing the marijuana to co-conspirators and customers. Thach also received at least six pounds of marijuana every week by mail from Mancilla that he re-distributed to his drug customers in amounts up to a pound at a time. Thach had these packages delivered to co-conspirators’ homes and to a stash location he maintained in Silver Spring, Maryland.
Mancilla charged between $3,000 and $4,000 per pound of marijuana. During their participation in the conspiracy, Mancilla, Thach and Escobar conspired to distribute over 1,500 pounds of marijuana.
Mancilla arranged to receive payment for the marijuana he caused to be distributed by having drug customers deposit cash payments in amounts less than $10,000 into bank accounts that he controlled that were held in fake names and in the names of fake businesses. Mancilla and other co-conspirators, including Thach and Escobar, structured the financial transactions to evade requirements that banks must report transactions over $10,000 to the IRS, thereby concealing from the government large cash transactions by drug dealers.
Mancilla also had drug customers make payments to Escobar and other co-conspirators in Maryland, who bundled the drug proceeds together in amounts ranging from $10,000 to $100,000. Thach and other individuals traveled by plane from Maryland to Mancilla in California with the bundles of money. Finally, Mancilla arranged for drug customers, including Thach, to mail drug proceeds from Maryland to him in California.
This money laundering conspiracy involved at least $1 million.
United States Attorney Rod J. Rosenstein commended HSI Baltimore and Montgomery County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Christen A. Sproule and Mara Zusman Greenberg, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Laredoan Sent to Prison for Possessing Child PornographyOrdered to Pay More Than $1 Million in RestitutionRead the Press Release
LAREDO, Texas – Luis Alberto Alcala, 25, of Laredo, has been ordered to federal prison for nearly eight years following his conviction of possessing with intent to view visual depictions of minors engaged in sexually explicit conduct, United States Attorney Kenneth Magidson announced today. He pleaded guilty Aug. 15, 2012.
Today, the government presented additional evidence including statements from one of the identified victims and members of her family. U.S. District Judge George P. Kazen took into consideration the amount of the images, the ages of the victims depicted therein and the types of child pornographic images and videos that were found on the Alcala’s computer. He then sentenced him to 90 months in federal prison. In handing down the sentence, Judge Kazen stated Alcala needed mental health treatment while in prison and when he was released in order to address his propensity to possibly re-offend. Judge Kazen also ordered Alcala to register as a sex offender. Alcala was further ordered to pay restitution in the amount of $950,000 to a known victim fund and another $150,000 to an identified victim. He will also be required to serve a term of 30 years of supervised release following completion of his prison sentence, during which Alcala is ordered not to work with, live near or have any direct contact with any minor without prior approval by the U.S. Probation Office. In addition, Alcala is ordered to not subscribe to and online service provider or use computer software for such purpose.
At the time of his guilty plea, Alcala admitted to downloading from child pornography sites and viewing pictures and videos of girls under the age of 18 engaging in sexually explicit conduct. Several of the images were identified as known victims and indexed in the National Center for Missing and Exploited Children.
The case arose from an Homeland Security Investigations (HSI) and Laredo Police Department (LPD) investigation that began in June 2008 after a complaint of the theft of a debit/credit card. The card was used to purchase a computer at Wal-Mart along with other items that were not authorized by the owner of the debit/credit card. Further investigation by LPD led to Alcala who admitted to detectives that he had used the card to purchase the laptop computer that was found at his apartment. A search of the computer by LPD showed that the computer hard drive contained numerous visual depictions of minors engaged in sexually explicit acts, at which time LPD referred this part of the investigation to HSI.
HSI agents conducted a forensic exam of the computer’s hard drive, which revealed 194 photographic images and 20 movies of minors engaged in sexually explicit conduct. Alcala admitted to LPD investigators that he had downloaded the images himself because he was curious.
Alcala will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
HSI and LPD investigated with assistance of the Texas Department of Criminal Justice.
This case, prosecuted by Assistant United States Attorney Roberto F. Ramirez, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Lancaster County Man Charged with Possession of Child PornographyRead the Press Release
Richard Dean Russell, 52, of New Holland, PA, was charged today, by information, with possession of child pornography, announced United States Attorney Zane David Memeger. The indictment charges Russell with one count of possessing child pornography on October 17, 2012.
If convicted the defendant faces a maximum possible sentence of 10 years imprisonment.
The case was investigated by the United States Postal Inspection Service and is being prosecuted by Assistant United States Attorney Albert S. Glenn.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices 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.
Judge Sentences Johnstown Felon to 7½ Years in Prison for Possessing WeaponRead the Press Release
JOHNSTOWN, Pa. – A resident of Johnstown, Pa., has been sentenced in federal court to 92 months incarceration and three years of supervised release on his conviction of unlawful possession of a firearm by a convicted felon, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Rogelin M. Lopez, 26, of Johnstown, Pa.
According to information presented to the court, on Dec. 24, 2009, Lopez, who had been convicted in 2006 in Cambria County, Pa., of delivery of a controlled substance, unlawfully possessed a Smith & Wesson pistol. Federal law prohibits persons who have been convicted of a crime punishable by imprisonment for more than one year from possessing ammunition or firearms. Delivery of a controlled substance is such a crime.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Johnstown Police Department and the Laurel Highlands Resident Agency of the Federal Bureau of Investigation for the investigation leading to the successful prosecution of Lopez.
According to Mr. Hickton, Lopez was prosecuted as part of Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crime.
Henrico Car Dealer Sentenced for Evading $668,791 in Taxes Owed to the IRSRead the Press Release
RICHMOND, Va. – Samad Jafari, 55, of Henrico, Va., was sentenced to 30 months in prison for a tax evasion scheme involving his used car sales business known as United Import Company, Ltd. (United Import), and was ordered to pay restitution in the amount of $668,791. In addition, on March 25, 2013, United Import was ordered to pay forfeiture in the amount of $735,225 as a result of its guilty plea to structuring cash deposits to prevent banking institutions from reporting currency transactions to the Internal Revenue Service (IRS).
Neil H. MacBride, United States Attorney for the Eastern District of Virginia; and Thomas J. Kelly, Special Agent in Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C., Field Office, made the announcement after the sentencing by United States District Judge Henry E. Hudson.
Jafari and United Import pled guilty on March 25, 2013. In a statement of facts filed with both plea agreements, Jafari admitted he was the owner and operator of United Import, which has been in business since 1999. Jafari was the sole signatory and owner of a business account in the name of United Import. He acknowledged that beginning in 2006, Jafari developed a scheme to receive cash payments for the financing of used cars, and subsequently structured cash deposits into the business account, as well as other personal bank accounts. Jafari also created a second set of figures to provide to his accountant in preparing his 2006 and 2007 Federal Income Tax returns, which significantly understated the amount of cash payments he received for vehicle financing. The total tax loss identified in the investigation was in excess of $698,000.
In addition, Jafari acknowledged that, acting as President of United Import, he structured or caused to be structured, over $735,000 in cash deposits during a 24-month time period in an effort to prevent banking institutions from filing a “Currency Transaction Report” or CTR. Banks are required to file CTRs under the Bank Secrecy Act for cash transaction in excess of $10,000, and the forms are used to detect criminal activity, including tax evasion. To avoid the reporting requirement, which had the potential to alert the authorities to the actual amount of cash he had received, Jafari broke deposits down into multiple transactions in amounts below $10,000, and used both business and personal accounts.
This case was investigated by the Internal Revenue Service – Criminal Investigation. Assistant United States Attorney David T. Maguire prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Guilty Plea Entered to Dealing and Passing Counterfeit Reserve NotesRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Mr. Jonathan Moody, age 25, of Nashville, Georgia, entered a plea of guilty on July 31, 2013, to two counts of counterfeiting involving United States currency. The guilty plea was entered before the Honorable Hugh Lawson, Senior United States District Judge for the Middle District of Georgia, in Valdosta, Georgia.
In his plea of guilty Mr. Moody admitted that he knowingly passed counterfeit $100 and $20 bills, using the counterfeit money to make purchases and receive change in genuine currency from merchants in the Valdosta area, causing financial losses to those businesses.
Sentencing for Mr. Moody has been set for October 28, 2013, in Valdosta. Mr. Moody faces up to twenty (20) years imprisonment and a $250,000.00 fine on each of the two counts.
The case was investigated by the United States Secret Service and the Lowndes County Sheriff’s Office. Assistant United States Attorney Robert D. McCullers is handling the prosecution for the Government.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Guilty Plea EnteredRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced that Mr. Kenneth E. Henderson, age 49, of Tifton, Georgia, entered a plea of guilty, on July 29, 2013, to one count of receipt of child pornography before the Honorable Hugh Lawson, Senior United States District Judge for the Middle District of Georgia, in Valdosta, Georgia.
A search of Mr. Henderson’s computer by law enforcement revealed videos and images of minors engaged in sexually explicit conduct. Some of the videos and images involved prepubescent minors and minors under the age of twelve. Mr. Henderson admitted that he searched for and viewed child pornography on the internet during a seven month period while he was assigned as an employee of the United States Armed Forces in Kuwait.
Sentencing for Henderson has been scheduled for October 28, 2013, in Valdosta. Mr. Henderson faces a mandatory minimum of five (5) years in prison, and could be sentenced to a maximum of up to twenty (20) years imprisonment, to be followed by a term of supervised release of not less than five (5) years, or life, as well as a fine of up to $250,000.00.
The case was investigated by the Department of Homeland Security, Homeland Security Investigations and the Naval Criminal Investigation Service (NCIS). Assistant United States Attorney Robert D. McCullers is handling the prosecution for the Government.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Greenville Drug Trafficker Sentenced in Operation "No Quarter"Read the Press Release
NEW BERN – United States Attorney Thomas G. Walker announced that today in federal court, United States District Judge Louise W. Flanagan sentenced MARIO CARMON , 33, of Greenville, North Carolina, to 100 months imprisonment, followed by 4 years of supervised release.
CARMON was named in an Indictment filed on September 12, 2012 charging him with conspiracy to distribute heroin and crack cocaine as well as distributing heroin and crack cocaine. On November 14, 2012, CARMON pled guilty to conspiracy charge.
Between December 7 and December 12, 2011, the Greenville Regional Drug Task Force made four controlled purchases of controlled substances from CARMON, including heroin and crack cocaine. On March 24, 2012, investigators executed a search warrant at 307 Manhattan Avenue, where several of the aforementioned controlled purchases had taken place. Officers encountered CARMON attempting to flee the residence; however, he was detained. On the kitchen counter, officers located 10 grams of cocaine base, and a bindle of heroin. CARMON claimed the drugs as his, and admitted to selling drugs. Further investigation revealed that CARMON had been selling heroin and crack cocaine since 2007.
The Organized Crime Drug Enforcement Task Force (OCDETF) Operation "No Quarter" was designed to attack the infrastructure of the Mexican Drug Trafficking Organizations (DTO), including those of the Los Zetas, La Familia, Gulf and Sinaloa drug cartels, operating not only in the Eastern District of North Carolina, but throughout North Carolina, the United States and Mexico. These DTO's are responsible for the importation of large quantities of cocaine, marijuana, heroin, and methamphetamine into the United States, as well as the related remittance of illegal drug proceeds back into Mexico.
The investigation spanned ten years and five North Carolina counties. As part of the investigation, over 100 individuals have been charged by indictment or criminal information in the Eastern District of North Carolina and state courts. Law enforcement officials seized drugs with a street value of $4.6 million, including 127 kilograms of cocaine, 53 pounds of crystal methamphetamine, 160 pounds of marijuana, and 32 grams of heroin. Additionally, $2.2 million in U.S. Currency, 35 firearms and 35 real properties valued at $1.5 million were seized by law enforcement authorities.
The investigations of cases in Operation "No Quarter" were conducted by the Drug Enforcement Administration (DEA) - Raleigh and Greensboro Resident Offices, the New York Field Division and numerous other DEA offices in the United States and Mexico; the Internal Revenue Service - Criminal Investigation Division; the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) - Raleigh and Wilmington offices; the United States Marshals Service; the United States Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI) - Raleigh and Tampa, Florida offices; the North Carolina State Bureau of Investigation; the North Carolina National Guard; the North Carolina State Highway Patrol; the Greenville Police Department; the Pitt County Sheriff's Office; the Pamlico County Sheriff's Office; the Lenoir County Sheriff's Office; the Craven County Sheriff's Office; the Carteret County Sheriff's Office; the Beaufort County Sheriff's Office; the New Bern Police Department, the Wayne County Sheriff's Office; the Person County Sheriff's Office; the Farmville Police Department; the Goldsboro Police Department; the Rocky Mount Police Department; the Burlington Police Department, the Alamance County Sheriff's Office, and the Wilson Police Department.
The federal prosecutions were handled by Special Assistant United States Attorneys Glenn Perry and Augustus Willis, IV. Mr. Perry is a prosecutor with the Pitt County District Attorney’s Office. Mr. Willis is a prosecutor with the Carteret, Craven and Pamlico Counties District Attorney’s Office. District Attorneys Kimberly Robb and Scott Thomas have assigned Mr. Perry and Mr. Willis to the United States Attorney’s Office to prosecute federal Organized Crime Drug Enforcement Task Force criminal matters. Their assignments to the United States Attorney’s Office have been made possible by grants funded by the Governor’s Crime Commission.
Fruitland Man Sentenced to 35 Years in Prison for Conspiracy, Arson and Theft of FirearmsRead the Press Release
VonBargen Convicted of Destroying Government Vehicles and a Building in Payette, Idaho
BOISE – U.S. Attorney Wendy J. Olson announced today that David Joseph VonBargen, 50, of Fruitland, Idaho, was sentenced today in United States District Court to 420 months in prison followed by three years of supervised release. VonBargen was convicted by a federal jury in April 2013 of carrying and using firearms – Molotov cocktails – during and in relation to a federal crime of violence, conspiracy to maliciously use explosive materials, conspiracy to maliciously damage federal property, and theft of firearms. Chief U.S. District Judge B. Lynn Winmill also ordered VonBargen to pay $162,124.87 in restitution to Western Core Door, Inc. and the U.S. Department of Agriculture.
During the five-day trial, the jury heard evidence that on May 27, 2011, VonBargen and his co-defendant, Donovan James Bolen, schemed to set fires in Payette to divert law enforcement while they broke into the World’s Largest Pawn Shop, in Fruitland, and stole firearms. The jury found VonBargen guilty of using Molotov cocktails to set fire to two U.S. Department of Agriculture vehicles and a lumber warehouse belonging to Western Core Door, Inc., in Payette. The jury also found VonBargen guilty of burglarizing and stealing 12 firearms, including rifles, revolvers, and pistols, from the World’s Largest Pawnshop.
Donovan Bolen, 23, also of Fruitland, was sentenced on February 5, 2013, to 444 months – 37 years – in federal prison and ordered to pay $162,124.87 in restitution to Western Core Door, Inc. and the U.S. Department of Agriculture. On October 16, 2012, Bolen was convicted by a federal jury of carrying and using firearms during and in relation to a federal crime of violence, conspiracy to maliciously use explosive materials, conspiracy to maliciously damage federal property, and theft of firearms.
“Mr. VonBargen’s use of Molotov cocktails to divert the attention of law enforcement was unconscionable, endangered the lives of first responders, and destroyed the property of innocent victims,” said Olson. “I commend the swift law enforcement response that brought both of the defendants in this case to justice. Mr. VonBargen now, like his co-defendant, faces a well-deserved lengthy prison sentence.”
The case was investigated by the Fruitland Police Department, the Payette Police Department, the Payette County Sheriff's Office, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and the Idaho State Fire Marshal.
Former Metairie Resident, Anil Patel, Charged with Tax FraudRead the Press Release
ANIL PATEL, age 45, formerly a resident of Metairie, Louisiana, was charged in a bill of information today with filing a false tax return, announced U. S. Attorney Dana J. Boente.
According to court documents, on August 6, 2009, PATEL signed and filed a 2008 U. S. Individual Income Tax Return (Form 1040) with the Internal Revenue Service. The tax return allegedly did not report approximately $426,744 in income.
If convicted, PATEL faces a maximum term of imprisonment of 3 years, as well as a fine of $250,000 and 1 year of supervised release following any term of imprisonment.
U. S. Attorney Boente reiterated that the bill of information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
The case was investigated by the Special Agents of the Internal Revenue Service and the prosecution is being handled by Assistant United States Attorney Jon Maestri.
(Download Bill of Information )
Former Mayoral and Congressional CandidateGuilty of Mail Fraud in Scheme to Defraud the BP Oil Spill FundRead the Press Release
A former candidate for mayor of Detroit and for Congress was convicted on August 5, 2013, of three counts of mail fraud, United States Attorney Barbara L. McQuade announced today.
Duane Montgomery, Jr., age 46, of Livonia, Michigan was found guilty by a federal jury in Detroit after a trial before the Honorable Stephen J. Murphy, III, United States District Judge.
At the trial beginning July 16, 2013, the jury heard evidence that Montgomery submitted a series of false claims to British Petroleum (“BP”), the Gulf Coast Claims Facility (funded by BP), and the National Pollution Fund Center, administered by the United States Coast Guard, all seeking compensation for purported damages to a boat he claimed to have been operating in the Gulf of Mexico at the time of the Deepwater Horizon oil spill. The claims centered around his assertion that tar balls resulting from the oil spill destroyed his engines while he was engaged in pollution monitoring for the corporation he owned, Engineering Technological Researchers, Inc., and that the company lost hundreds of thousands of dollars in revenue as a result. Specifically, the defendant’s last claim to the National Pollution Fund Center sought $861,512, which was denied. Earlier, however, the Gulf Coast Claims Facility issued an emergency interim payment to the defendant in the amount of $43,900.
United States Attorney Barbara L. McQuade said, “This defendant’s scheme to defraud targeted private and public funds designated for the victims of the worst ecological disaster in this country’s history. We will continue to aggressively investigate and prosecute such crimes to protect the funds intended for those in need.”
McQuade commended the United States Secret Service Detroit Field Office and the Department of Homeland Security’s Office of Inspector General for the investigation leading to this successful prosecution.
After the verdict, the Court revoked the defendant’s bond. He will remain in custody awaiting sentencing at a time to be set by the Court.
Former High School Softball Coach Sentenced to over 23 Years in Prison for Child Pornography ConvictionRead the Press Release
LAS VEGAS, Nev. – A former softball coach at Silverado High School in Henderson, Nev., has been sentenced to 284 months in federal prison and lifetime supervised release for his convictions for having sexual relations with one of the female players and using his cellular telephone camera to photograph the sexual acts, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Albert Silva Hernandez, Jr., 44, of Las Vegas, was sentenced on Monday, Aug. 5, 2013, by U.S. District Judge James C. Mahan. Hernandez was convicted by a jury in April of eight counts of sexual exploitation of a minor.“Together with our investigative partners, we have been aggressively investigating and prosecuting persons who exploit minors for sexual purposes and use technology to further victimize these children,” said U.S. Attorney Bogden. “If you commit such crimes, you face very serious consequences and a lengthy prison sentence.”
According to the indictment and evidence introduced at trial, Hernandez, a softball coach for Silverado High School and for a competitive club team, had sexual relations with one of his 17-year-old players, and photographed the sexual acts with his cellular telephone camera and sent the images to the girl. Hernandez also had the girl photograph herself naked and send those images to him by her cellular telephone. The pornographic images were produced and the text messages were exchanged between Hernandez and the victim, on Dec. 25, 2011, Jan. 29, Feb. 1, and Feb. 2, 2012.
“As this sentence makes unmistakably clear, child sex predators will receive the justice they are due for their despicable actions,” said Michael Harris, Assistant Special Agent in Charge of Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) in Las Vegas. “We will continue to aggressively target those who prey upon and sexually exploit our children. We owe it to the young victims in these cases, who will carry the emotional and physical scars of these crimes for the rest of their lives.”
The case was investigated by ICE-HSI and the Clark County School District Police. It was prosecuted by Assistant United States Attorneys Susan Cushman and Roger Yang.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Former Executive Director of Indian Human Resource Center Pleads Guilty to Embezzling Non-Profit’s MoneyRead the Press Release
San Diego, CA - United States Attorney Laura E. Duffy announced today that David Hedley, a former Executive Director of the Indian Human Resource Center (“IHRC”), admitted embezzling over $140,000 from the San Diego-based non-profit.
According to his plea agreement, Hedley served as IHRC’s Executive Director between September 10 and December 11, 2012. Taking advantage of his position as a signer on IHRC’s credit union account, he obtained a debit card allowing him virtually unrestricted access to the funds in one of the credit union accounts. Once he obtained this access, Hedley stole approximately $141,260 in federal funds from IHRC.
According to the plea agreement, at the same time Hedley was stealing funds from IHRC’s credit union account, he was spending comparable sums gambling at a local Indian casino. For example, on October 9, 2012, Hedley withdrew $15,000 in cash from the IHRC credit union account at the North Island Credit Union (“NICU”) located in La Mesa, California. On that same day, Hedley gambled $15,000 at Viejas Casino. Similarly, on October 12, 2012, Hedley improperly withdrew $20,000 in cash from IHRC’s credit union account at the NICU branch in Imperial Beach, California and gambled with that sum at Pala Casino. Hedley also admitted to using over $800 in embezzled funds to buy Southwest Airlines tickets to Las Vegas, Nevada, where he spent thousands of dollars in stolen funds at the Hard Rock Hotel and Casino.
The IHRC was established to train and assist Native Americans with finding employment outside the tribal setting and was awarded over a half million dollars in federal funding from the U.S. Department of Labor over the past two years as part of the Workforce Investment Act (“WIA”). The Workforce Investment Act of 1998 (“WIA”) established a national workforce preparation and employment system to meet the needs of persons seeking employment, including new entrants to the workforce, in order to increase the employment, job retention, earnings and occupational skills of participants, improve the quality of the workforce, reduce welfare dependency, and improve the productivity and competitiveness of the United States.
As a result of his guilty plea, Hedley is facing up to 10 years in prison, and has agreed to pay mandatory restitution of $141,260.44, and to forfeit any property derived from or traceable to the proceeds he obtained from the offense.
Sentencing is scheduled for October 21 at 9 a.m. before U.S. District Judge William Q. Hayes.
DEFENDANT Criminal Case No. 13CR1129-WQH David M. Hedley SUMMARY OF CHARGESCounts 1-8: Title 18, United States Code, Section 666(a)(1)(A) – Theft from Program Receiving
Federal FundsForfeiture: Title 18, United States Code, Sections 981(a)(1)(C) and Title 28, United States Code, Section 2461(c)
INVESTIGATING AGENCIESFederal Bureau of Investigation
California Department of Justice, Bureau of Gambling ControlFormer Debt Counselor Charged with FraudRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today the filing of a Criminal Information in U.S. District Court in Scranton charging Timothy Turner, age 36, of Shavertown, Pennsylvania, with a fraud scheme utilizing the United States Mails.
According to United States Attorney Peter J. Smith, Turner allegedly held himself out as a mortgage consultant, financial consultant, debt relief consultant and/or credit repair consultant with a local business office in Kingston, Pennsylvania. Turner, conducting business under the following corporate and fictitious entity names: The Turner Financial Company, LLC; The Turner Financial Co., LLC; In-Motion Debt Relief; Turner Approved Mortgage; and The Mortgage Modification Consultants.
Turner allegedly devised a scheme to defraud a victim of funds the victim provided Turner who offered debt relief services which included offers to assist the victim in negotiating settlements with credit card companies.
Turner allegedly offered to negotiate settlements with the creditors for approximately 40% of what was owed when the victim’s escrow account reached a sufficient balance. Part was to go into an "escrow account" to be used to satisfy the victim’s outstanding debts, and a separate portion was to go to Turner for his services.
The Information alleges that Turner comingled client funds with company funds and converted the client funds for his own use. Turner allegedly deposited the victim’s funds into an account and then promptly divided it among other business accounts. During a 15-month period between August 1, 2008 through October 31, 2009, Turner made purchases of a personal nature utilizing the victim’s funds. Turner obtained from the victim approximately $23,600 of which Turner claimed that approximately $16,000 were his fees with the remainder allegedly deposited in the "escrow account." Turner allegedly did not settle any of the victim’s credit card debt nor negotiate any settlement; he allegedly closed the business, and moved out of state without reimbursing the victim.
The case was investigated by the United States Secret Service. Prosecution is assigned to Assistant United States Attorney John Gurganus.
Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In this particular case, the maximum penalty under the federal statute is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Former Clarksville Electric Department Consultant Sentenced to Four Years in PrisonRead the Press Release
Tommy Lee Walton, II, 39, of Waxhaw, North Carolina, was sentenced yesterday in U.S. District Court in Nashville for his role in an honest services mail and wire fraud scheme involving his payment of bribes and kickbacks to a former president of the Clarksville Department of Electricity, announced David Rivera, Acting U.S. Attorney for the Middle District of Tennessee.
Walton was sentenced to 48 months in prison, followed by 24 months of incarceration in a halfway house and 24 months of home confinement. He also was ordered to pay restitution to the Clarksville Department of Electricity in the amount of $95,211.38.
“Corrupt practices by public officials and consultants undermine the confidence that citizens must have in their governmental institutions,” said Acting U.S. Attorney David Rivera. “The costs of corruption are born by taxpayers, ratepayers, honest vendors and honest public employees. The Department of Justice is committed to prosecuting individuals who fraudulently game the system to line their own pockets at the expense of the public and of all those who labor honestly and follow the rules.”
Walton was found guilty by a federal court jury in January 2013 of nine counts of honest services mail fraud and seven counts of honest services wire fraud. According to testimony at trial, in November 2008 Walton was hired as a consultant for the Clarksville, Tennessee Department of Electricity by Rick R. Ingram, Sr., then president of the Clarksville Department of Electricity. From November 2008 through June 2009, Walton and his business entity, IntelliNet Consulting LLC, invoiced and received from the Clarksville Department of Electricity a total of $156,139,39. The payment of each invoice was approved by Ingram.
During that same time, Walton paid $51,500 directly to Ingram or to one of Ingram’s creditors. The payments by Walton to Ingram were not disclosed to members of the Clarksville Electric Power Board or to other employees at the Clarksville Department of Electricity. The United States alleged that these payments by Walton were bribes and kickbacks and that the concealment of these payments from the Clarksville Department of Electricity deprived the Clarksville Department of Electricity and its customers of the honest services of Ingram.
On May 25, 2012, Rick R. Ingram, Sr. entered a plea of guilty to two counts of honest services mail fraud and two counts of honest services wire fraud related to the same scheme for which Walton was convicted and sentenced and related to a separate scheme involving Walton’s father, Tommy L. Walton, Sr. Ingram testified at the Walton trial. A sentencing hearing is scheduled for Ingram on November 1, 2013.
Tommy L. Walton, Sr. entered a plea of guilty to eight counts of honest services mail fraud and to five counts of honest services wire fraud on Monday, January 14, 2013. A sentencing hearing for Tommy L. Walton, Sr. is scheduled for August 26, 2013.
This case was investigated by the Tennessee Valley Authority Office of Inspector General. The case was prosecuted by Assistant United States Attorneys Byron Jones and John Webb.
Fci Danbury Employee Pleads Guilty to Sexual Abuse ChargeRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that STEVEN WOLFF, 45, of the Bronx, N.Y., pleaded guilty today before United States Magistrate Judge Holly B. Fitzsimmons in Bridgeport to one count of sexual abuse of a ward.
According to court documents and statements made in court, WOLFF, while employed as a Utilities Systems Repair Operator Foreman by the Federal Bureau of Prisons at the Federal Correctional Institution in Danbury, engaged in sexual acts with one of the female inmates at the prison. On multiple occasions between July 2011 and November 27, 2011, WOLFF and the victim met privately in the boiler area of the prison facility and engaged in sexual intercourse. In addition, WOLFF provided contraband including hair dye, candy, greeting cards and over-the-counter medication to the inmate. Contraband was also provided to another inmate who acted as a lookout during the illicit sexual activity.
WOLFF is scheduled to be sentenced by Senior United States District Judge Warren W. Eginton in Bridgeport on October 29, 2013, at which time WOLFF faces a maximum term of imprisonment of 15 years of imprisonment and a fine of up to $250,000.
This case was investigated by the Department of Justice Office of Inspector General and is being prosecuted by Assistant United States Attorney Anastasia E. King.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Elizabeth City Man Sentenced for Drug Trafficking and Money LaunderingRead the Press Release
WILMINGTON – United States Attorney Thomas G. Walker announced that in federal court today, Senior United States District Judge James C. Fox sentenced DESMOND BERTRAM WHITE , 35, of Elizabeth City, North Carolina to 210 months imprisonment, followed by 5 years of supervised release.
WHITE was named in a Criminal Information filed on April 24, 2013 charging him with Conspiracy to Distribute and Possess with the Intent to Distribute 280 Grams or More of Cocaine Base (Crack) as well as Money Laundering. On April 29, 2013, WHITE pled guilty to those charges.
According to the investigation, WHITE was part of a drug trafficking conspiracy in the northeast portion of North Carolina. This drug trafficking organization distributed cocaine and cocaine base (crack) throughout that region. Additionally, WHITE and others would use the proceeds from the drug trafficking to finance a dog fighting ring that also operated in that area and other areas along the East Coast. WHITE was, conservatively, held accountable for distributing over 6 kilograms of cocaine base (crack).
Investigation of this case was conducted by the U.S. Drug Enforcement Administration and the Elizabeth City Police Department. Assistant United States Attorney, Rudy E. Renfer, represented the government.
Eagle Butte Man Sentenced for Sexually Assaulting A Person Incapable of ConsentingRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota, man convicted of Sexual Abuse of a Person Incapable of Consenting was sentenced on August 5, 2013, by U.S. District Judge Roberto A. Lange.
Frank Hill, age 38, was sentenced to 96 months of custody, 5 years of supervised release, and $100 special assessment to the Federal Crime Victims Fund.
Hill was indicted by a federal grand jury on October 16, 2012, and pled guilty to the offense on May 14, 2013.
The conviction arose from an incident in November 2009, when Hill sexually assaulted an adult female victim who was sleeping at her home in Eagle Butte.
The investigation was conducted by the Cheyenne River Sioux Tribe Law Enforcement Division. The case was prosecuted by Assistant U.S. Attorney Mikal Hanson.
Hill was remanded to the custody of the U.S. Marshal to begin serving his sentence.Dundalk Man Admits to Repeatedly Sexually Abusing A Child to Produce Child PornographyRead the Press Release
Baltimore, Maryland –Larry James Kerfoot, age 38, of Dundalk, Maryland, pleaded guilty yesterday to sexually exploiting a minor on at least five occasions to produce images of child pornography.
The plea agreement was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Chief James W. Johnson of the Baltimore County Police Department; and Baltimore County State’s Attorney Scott Shellenberger.
According to his plea agreement, on May 30, 2012, an undercover Baltimore County detective downloaded a video depicting child pornography from an internet file made available by Kerfoot from his Dundalk home. Law enforcement officers executed a search warrant on June 27, 2012 at his home and seized computers and digital media containing 19 videos and 80 images of child pornography that Kerfoot had received from the internet.
Officers also seized a video he had produced of a 12 year old girl whom he had coerced to engage in sexually explicit conduct with him on at least five occasions.
As part of his plea agreement, Kerfoot must register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
Kerfoot and the government have agreed that if the Court accepts the plea agreement, Kerfoot will be sentenced to between 25 and 30 years in prison followed by a lifetime of supervised release U.S. District Judge Ellen L. Hollander has scheduled sentencing for November 7, 2013 at 2 p.m.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI, HSI Baltimore, Baltimore County Police Department and Baltimore County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Judson T. Mihok, who prosecuted the case.
Dorchester Man Convicted of Wire Fraud and Aggravated Identity TheftRead the Press Release
BOSTON – A federal jury today convicted a Dorchester man for his role in a wire fraud and identity theft scheme.
Jean Exume, 31, was convicted of 22 counts of wire fraud and three counts of aggravated identity theft following a six-day jury trial.
Exume was convicted of using fraudulently obtained bank cards belonging to Bank of America customers who primarily were living in the Greater Boston area. The cards then were used to purchase tens of thousands of dollars’ worth of postal money orders. Exume was also convicted of using fraudulent Florida driver’s licenses in the names of these customers in connection with the purchases. Exume also used the Bank of America cards to withdraw funds directly from the customers’ accounts.
U.S. District Court Judge Nathaniel Gorton scheduled sentencing for Nov. 7, 2013. The statutory maximum penalty for each of the wire fraud charges is 30 years in prison, followed by three years of supervised release, a fine of $250,000, restitution and forfeiture. The mandatory penalty for an aggravated identity theft conviction is two years in prison to be followed by one year of supervised release.
United States Attorney Carmen M. Ortiz, Kevin M. Niland, Inspector in Charge of the U.S. Postal Inspection Service, Boston Division, and Boston Police Commissioner Edward Davis made the announcement today. The case was prosecuted by Assistant U.S. Attorneys Vassili Thomadakis of Ortiz’s Economic Crimes Unit and Amy Harman Burkart of Ortiz’s Cybercrime Unit.
Doctor and Two Consultants Found Guilty in Manhattan Federal Court in LIRR Disability Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that PETER LESNIEWSKI, MARIE BARAN, and JOSEPH RUTIGLIANO were convicted today in Manhattan federal court for their participation in a massive fraud scheme in which Long Island Rail Road (“LIRR”) employees claimed to be disabled upon early retirement so that they could receive federal disability benefits to which they were not entitled. The three defendants were convicted on all counts charged following a three-week trial before U.S. District Judge Victor Marrero. Twenty-eight defendants have now been convicted in this case.
Manhattan U.S. Attorney Preet Bharara said: “Today, Peter Lesniewski, Marie Baran and Joseph Rutigliano stand convicted of participating in the massive LIRR disability fraud that turned a safety net for the truly disabled into a gravy train for the corrupt. Dr. Lesniewski enabled hundreds of LIRR employees to dupe the government through medical paper trails filled with bogus diagnoses, while Baran and Rutigliano, in exchange for payments of thousands of dollars, helped lard the employees’ disability benefit applications with lies. Lesniewski, Baran and Rutigliano served as engines of this fraud that led to a staggering 79% of LIRR retirees from 1998 to 2011 receiving federal disability benefits, costing the government hundreds of millions of dollars. Like the 25 people who previously pled guilty, these defendants now have been brought to justice and will pay for their central roles in this brazen scheme.”
According to the charging documents in this case and evidence presented at trial:
The LIRR Disability Fraud Scheme
The U.S. 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 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 1998 through 2011, approximately 79% of LIRR retirees obtained federal disability when they retired. By contrast, during this same period, only approximately 21% of retiring Metro-North employees stopped working and began receiving RRB disability benefits.
During the period 2004 through 2008, just three doctors – including LESNIEWSKI – were responsible for approximately 86% of all the disability claims submitted by LIRR retirees. Another of these doctors, Dr. Peter J. Ajemian, pled guilty for his participation in the fraud and was sentenced in May 2013 to eight years in prison.
The Disability Doctor
LESNIEWSKI, a Board-certified orthopedist, recommended more than 130 LIRR workers for disability benefits. He used his medical practice as a disability mill, preparing fraudulent medical narratives for LIRR retirees well before the employees’ planned retirement dates so that the narratives could be submitted to the RRB upon retirement. These medical narratives were fabricated or grossly exaggerated in order to substantiate the LIRR employees’ bogus claims of disability. Many of the purportedly “objective” findings from the medical tests LESNIEWSKI conducted showed nothing more than normal – and non-disabling – degenerative changes one would expect to see in patients within the relevant age bracket. And in many cases, LESNIEWSKI failed to provide any meaningful treatment for the LIRR employees’ purported ailments. He received approximately $850 to $1,000, often in cash, for these fraudulent assessments and narratives, as well as hundreds of thousands of dollars in health insurance payments for unnecessary medical tests and fees for preparing fraudulent medical support for the claimed disabilities.
In one instance, a LIRR employee expressed concern to LESNIEWSKI about losing his disability benefits, and told him in writing, “Once I get shoulder fixed, Railroad Retirement may withdraw disability benefits.” In response, LESNIEWSKI performed tests on the employee’s back and knees, and within weeks, had created a paper trail falsely documenting supposedly disabling conditions in the employee’s back, hands, and knee.
The Disability Consultants
LIRR employees also utilized the services of so-called “disability consultants,” including BARAN and RUTIGLIANO, to further increase their chances of fraudulently obtaining disability benefits from the RRB. For approximately $1,000, typically paid in cash, BARAN and RUTIGLIANO falsely filled out disability applications on behalf of their LIRR clients to maximize the likelihood that they would receive disability benefits. Among other things, the defendants filled their clients’ disability applications with false, cookie-cutter descriptions of their physical condition and ability to work. The defendants also hid the income they were receiving from their respective disability consulting businesses.
Before working as a disability consultant, BARAN served as an RRB district office manager in Westbury, New York, until her retirement in December 2006. BARAN’s husband, an LIRR retiree, receives RRB disability benefits based on a medical assessment done by LESNIEWSKI. The disability application submitted by BARAN’s husband claimed that he was too disabled to work and that he had difficulty performing such basic daily activities as sitting, standing, walking, writing, and even tying his shoes. However, during his retirement, BARAN’S husband regularly played golf and traveled around the world with her. BARAN also referred her LIRR employee clients to LESNIEWSKI and the other disability doctors.
RUTIGLIANO is a former LIRR conductor and union president who applied for and received an RRB occupational disability after his retirement in 1999. In the year prior to retiring, he worked substantial hours of overtime, took no sick leave whatsoever, and then applied for a disability with a narrative LESNIEWSKI prepared. Moreover, while receiving disability benefits from the RRB, RUTIGLIANO regularly played golf year-round.
LESNIEWSKI, 62, of Rockville Centre, New York, was convicted of one count of conspiracy to commit mail fraud, wire fraud and health care fraud, which carries a maximum sentence of 20 years in prison, one count of conspiracy to defraud the RRB, which carries a maximum sentence of five years in prison, two counts of health care fraud, two counts of mail fraud, and four counts of wire fraud. Each of the health care fraud counts carries a maximum sentence of 10 years in prison, and each count of mail fraud and wire fraud carries a maximum sentence of 20 years in prison.
BARAN, 65, of East Meadow, New York, was convicted of two counts of conspiracy to commit mail fraud, wire fraud and health care fraud, two counts of conspiracy to defraud the RRB, two counts of health care fraud, two counts of mail fraud, and two counts of wire fraud.
RUTIGLIANO, 66, of Holtsville, New York, was convicted of two counts of conspiracy to commit mail fraud, wire fraud and health care fraud, two counts of conspiracy to defraud the RRB, three counts of mail fraud, three counts of wire fraud, and one count of making a false statement. The count of making false statements carries a maximum sentence of five years in prison.
LESNIEWSKI, BARAN and RUTIGLIANO will be sentenced by U.S. District Judge Victor Marrero on December 13, 2013 at 3pm.
Thirty-three people have been charged in connection with the LIRR disability fraud scheme, 25 of whom have pled guilty and three of whom have now been convicted after trial. The charges against the remaining defendants, Kevin Neville, Donald Alevas, 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-OIG, the FBI, and the MTA-OIG for their outstanding work in the investigation, which he noted is continuing. 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 Justin Weddle, Nicole Friedlander, and Daniel Tehrani are in charge of the prosecution.
Department of Justice Sues Bank of America for Defrauding Investors <br /> in Connection with Sale of over $850 Million of Residential Mortgage-Backed SecuritiesRead the Press Release
Attorney General Eric Holder and U.S. Attorney for the Western District of North Carolina Anne M. Tompkins announced today that the United States has filed a civil lawsuit against Bank of America Corporation and certain of its affiliates, including Merrill Lynch, Pierce, Fenner & Smith f/k/a/ Banc of America Securities, LLC, Bank of America, N.A., and Banc of America Mortgages Securities, Inc. (collectively “Bank of America”). The complaint alleges that Bank of America lied to investors about the relative riskiness of the mortgage loans backing the residential mortgage-backed securities (RMBS), made false statements after intentionally not performing proper due diligence and filled the securitization with a disproportionate amount of risky mortgages originated through third party mortgage brokers.
This announcement is part of the ongoing efforts of President Obama’s Financial Fraud Enforcement Task Force’s RMBS Working Group and is accompanied by an announcement by the Securities and Exchange Commission (SEC) that it has filed civil charges in federal court in Charlotte, N.C. against Bank of America for defrauding investors.
“Today's filing marks the latest step forward in the Justice Department’s ongoing efforts to hold accountable those who engage in fraudulent or irresponsible conduct,” said Attorney General Eric Holder. “As this action proves, President Obama’s Financial Fraud Enforcement Task Force will continue to take an aggressive approach to combating financial fraud and uncovering abuses in the residential mortgage-backed securities market. As we proceed with this case, and pursue a range of additional investigations, we will continue to use every tool, resource, and appropriate authority to ensure stability, accountability, and – above all – justice for those who have been victimized.”
“This is the RMBS Working Group’s most recent legal enforcement targeting misconduct in the RMBS market, but it will not be our last,” said Associate Attorney General Tony West. “Combating financial fraud is a top priority for the Department of Justice. By filing this lawsuit today, we reaffirm an important principle – that everyone must play by the same set of rules, and no institution is too big or too powerful to escape appropriate enforcement. It is also a testament to the cooperation and coordination among the Working Group’s members, as the Justice Department and the SEC brought to bear their collective expertise and resources to build these cases against Bank of America.”
“Bank of America’s reckless and fraudulent origination and securitization practices in the lead-up to the financial crisis caused significant losses to investors,” U.S. Attorney Tompkins said. “Now, Bank of America will have to face the consequences of its actions. We have made a commitment to the American people to hold financial institutions accountable for practices that violated the law and wreaked havoc on the financial system, and my office takes that commitment very seriously. Our investigation into Bank of America’s mortgage and securitization practices continues.”
“I applaud Attorney General Holder for taking this important step toward holding Bank of America accountable for packaging and selling toxic loans to investors and brokers, a key cause of the housing collapse that crashed our economy and still plagues communities to this day,” said New York Attorney General Eric Schneiderman. “As a Co-Chair of the Working Group, I look forward to further action to address the causes and consequences of the financial crisis. The housing crisis in New York is far from over, and actions like these are necessary to ensure that homeowners are protected from similar conduct by banks and lenders in the future.”
A residential mortgage-backed security is a bond backed by of a pool of residential mortgage loans that were packaged together and sold in different tranches (or risk-levels) to investors.
The civil complaint filed today in U.S. District Court in Charlotte alleges that Bank of America defrauded investors, including federally insured financial institutions, who purchased more than $850 million in RMBS from Bank of America Mortgage Securities 2008-A (BOAMS 2008-A) securitization. The government’s civil complaint also seeks civil penalties from Bank of America under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA). According to the complaint, in or about January 2008, Bank of America sold BOAMS 2008-A RMBS certificates to investors by knowingly and willfully making materially false and misleading statements and by failing to disclose important facts about the mortgages collateralizing the RMBS, including Bank of America’s failure to conduct loan level due diligence in the offering documents filed with the U.S. Securities and Exchange Commission (SEC). These misstatements and omissions concerned the quality and safety of the mortgages collateralizing the BOAMS 2008-A securitization, how it originated those mortgages and the likelihood that the “prime” loans would perform as expected.
First, according to the filed complaint, a material number of the mortgages in the BOAMS 2008-A collateral pool failed to materially adhere to Bank of America’s underwriting standards. Specifically, more than 40% of the 1,191 mortgages in the BOAMS 2008-A collateral pool did not substantially comply with Bank of America’s underwriting standards in place at the time they were originated and did not have sufficient documented compensating factors. As alleged in the complaint, Bank of America knew that specific loans in the BOAMS 2008-A collateral pool did not materially adhere or comply with Bank of America’s underwriting standards.Second, Bank of America did not conduct any loan-level due diligence at the time of securitization. According to the complaint, this was a violation of Bank of America’s own policies, procedures and prior practice, and was contrary to industry standards and investor expectations. Moreover, this decision allowed Bank of America to keep bad loans in the deal. According to the complaint, these bad loans had a range of glaring origination problems, such as overstated income, fake employment, inflated appraisals, wrong loan-to-value ratios, undisclosed debt, occupancy misrepresentation, mortgage fraud and other red flags wholly inconsistent with a purportedly prime securitization. As a result of this lack of due diligence, Bank of America had no basis to make many of the representations it made in the offering documents regarding the credit quality of the underlying mortgages.
Finally, Bank of America concealed important risks associated with the mortgages backing the BOAMS 2008-A securitization. For example, Bank of America originated more than 70% of the loans through third party mortgage brokers. These loans, known as “wholesale mortgages,” were riskier than similar mortgages originated directly by Bank of America. More significantly, at the same time Bank of America was finalizing this deal, it was receiving a series of internal reports that showed an alarming and significant decrease in the quality and performance of its wholesale mortgages. According to the complaint, Bank of America did not disclose that important information or the associated risks to investors.
Investors in the BOAMS 2008-A certificates have already suffered millions of dollars in losses and it is estimated that total losses sustained by investors will exceed $100 million.
FIRREA permits the Attorney General to commence civil actions to recover penalties from, among others, people who violate specified provisions of Title 18 of the United States Code, including 18 U.S.C. § 1001 (false statement to government) and 18 U.S.C. § 1014 (false statement to financial institution). In such actions, the civil penalties assessed may equal $1.1 million per violation, or, for a continuing violation, up to $1.1 million per day or $5.5 million, whichever is less pursuant to(12 U.S.C. § 1833(a)(b)(1)-(2); see also 28 C.F.R. § 85.3. The statute further provides that the penalty can exceed these limits to permit the recovery of the amount of monetary gain received from or the amount of monetary loss caused by the violations under 12 U.S.C. §1833a(b)(3).
Attorney Tompkins thanked the U.S. Securities and Exchange Commission, Division of Enforcement, Atlanta Regional Office for its significant cooperation. The case is being handled by Assistant United States Attorneys Daniel S. Ryan and Mark T. Odulio of the United States Attorney’s Office in Charlotte.
The RMBS Working Group is a federal and state law enforcement effort focused on investigating fraud and abuse in the RMBS market that helped lead to the 2008 financial crisis. The RMBS Working Group brings together more than 200 attorneys, investigators, analysts and staff from dozens of state and federal agencies including the Department of Justice, ten U.S. Attorneys’ Offices, the FBI, the SEC, the Department of Housing and Urban Development (HUD), HUD’s Office of Inspector General, the Federal Housing Finance Agency’s Office of Inspector General, the Office of the Special Inspector General for the Troubled Asset Relief Program, the Federal Reserve Board’s Office of Inspector General, the Recovery Accountability and Transparency Board, the Financial Crimes Enforcement Network, and more than ten state Attorneys General offices around the country.
The RMBS Working Group is led by five co-chairs: Acting Assistant Attorney General for the Criminal Division Mythili Raman, Assistant Attorney General for the Civil Division Stuart Delery, Co-Director of the SEC’s Division of Enforcement George Canellos, U.S. Attorney for the District of Colorado John Walsh and New York Attorney General Eric Schneiderman.
Learn more about the Residential Mortgage- Backed Securities Working Group and the Financial Fraud Enforcement Task Force at www.stopfraud.gov.
For more information on the SEC’s charges against Bank of America, please visit: http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370539751924.
Department of Justice Sues Bank of America for Defrauding Investors in Connection with Sale of over $850 Million of Residential Mortgage-Backed SecuritiesRead the Press Release
Bank Of America Structured, Offered And Sold Purportedly Prime Securities After Failing To Conduct Due Diligence On Any of the Mortgage Loans
CHARLOTTE, N.C. - Attorney General Eric Holder and U.S. Attorney for the Western District of North Carolina Anne M. Tompkins announced today that the United States has filed a civil lawsuit against Bank of America Corporation and certain of its affiliates, including Merrill Lynch, Pierce, Fenner & Smith f/k/a/ Banc of America Securities, LLC, Bank of America, N.A., and Banc of America Mortgages Securities, Inc. (collectively “Bank of America”). The complaint alleges that Bank of America lied to investors about the relative riskiness of the mortgage loans backing the residential mortgage-backed securities (RMBS), made false statements after intentionally not performing proper due diligence and filled the securitization with a disproportionate amount of risky mortgages originated through third party mortgage brokers.
This announcement is part of the ongoing efforts of President Obama’s Financial Fraud Enforcement Task Force’s RMBS Working Group and is accompanied by an announcement by the Securities and Exchange Commission (SEC) that it has filed civil charges in federal court in Charlotte, N.C. against Bank of America for defrauding investors.
“Today's filing marks the latest step forward in the Justice Department’s ongoing efforts to hold accountable those who engage in fraudulent or irresponsible conduct,” said Attorney General Eric Holder. “As this action proves, President Obama’s Financial Fraud Enforcement Task Force will continue to take an aggressive approach to combating financial fraud and uncovering abuses in the residential mortgage-backed securities market. As we proceed with this case, and pursue a range of additional investigations, we will continue to use every tool, resource, and appropriate authority to ensure stability, accountability, and – above all – justice for those who have been victimized.”
“This is the RMBS Working Group’s most recent legal enforcement targeting misconduct in the RMBS market, but it will not be our last,” said Associate Attorney General Tony West. “Combating financial fraud is a top priority for the Department of Justice. By filing this lawsuit today, we reaffirm an important principle – that everyone must play by the same set of rules, and no institution is too big or too powerful to escape appropriate enforcement. It is also a testament to the cooperation and coordination among the Working Group’s members, as the Justice Department and the SEC brought to bear their collective expertise and resources to build these cases against Bank of America.”
“Bank of America’s reckless and fraudulent origination and securitization practices in the lead-up to the financial crisis caused significant losses to investors,” U.S. Attorney Tompkins said. “Now, Bank of America will have to face the consequences of its actions. We have made a commitment to the American people to hold financial institutions accountable for practices that violated the law and wreaked havoc on the financial system, and my office takes that commitment very seriously. Our investigation into Bank of America’s mortgage and securitization practices continues.”
“I applaud Attorney General Holder for taking this important step toward holding Bank of America accountable for packaging and selling toxic loans to investors and brokers, a key cause of the housing collapse that crashed our economy and still plagues communities to this day,” said New York Attorney General Eric Schneiderman. “As a Co-Chair of the Working Group, I look forward to further action to address the causes and consequences of the financial crisis. The housing crisis in New York is far from over, and actions like these are necessary to ensure that homeowners are protected from similar conduct by banks and lenders in the future.”
A residential mortgage-backed security is a bond backed by of a pool of residential mortgage loans that were packaged together and sold in different tranches (or risk-levels) to investors.
The civil complaint filed today in U.S. District Court in Charlotte alleges that Bank of America defrauded investors, including federally insured financial institutions, who purchased more than $850 million in RMBS from Bank of America Mortgage Securities 2008-A (BOAMS 2008-A) securitization. The government’s civil complaint also seeks civil penalties from Bank of America under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA). According to the complaint, in or about January 2008, Bank of America sold BOAMS 2008-A RMBS certificates to investors by knowingly and willfully making materially false and misleading statements and by failing to disclose important facts about the mortgages collateralizing the RMBS, including Bank of America’s failure to conduct loan level due diligence in the offering documents filed with the U.S. Securities and Exchange Commission (SEC). These misstatements and omissions concerned the quality and safety of the mortgages collateralizing the BOAMS 2008-A securitization, how it originated those mortgages and the likelihood that the “prime” loans would perform as expected.
First, according to the filed complaint, a material number of the mortgages in the BOAMS 2008-A collateral pool failed to materially adhere to Bank of America’s underwriting standards. Specifically, more than 40% of the 1,191 mortgages in the BOAMS 2008-A collateral pool did not substantially comply with Bank of America’s underwriting standards in place at the time they were originated and did not have sufficient documented compensating factors. As alleged in the complaint, Bank of America knew that specific loans in the BOAMS 2008-A collateral pool did not materially adhere or comply with Bank of America’s underwriting standards.
Second, Bank of America did not conduct any loan-level due diligence at the time of securitization. According to the complaint, this was a violation of Bank of America’s own policies, procedures and prior practice, and was contrary to industry standards and investor expectations. Moreover, this decision allowed Bank of America to keep bad loans in the deal. According to the complaint, these bad loans had a range of glaring origination problems, such as overstated income, fake employment, inflated appraisals, wrong loan-to-value ratios, undisclosed debt, occupancy misrepresentation, mortgage fraud and other red flags wholly inconsistent with a purportedly prime securitization. As a result of this lack of due diligence, Bank of America had no basis to make many of the representations it made in the offering documents regarding the credit quality of the underlying mortgages.
Finally, Bank of America concealed important risks associated with the mortgages backing the BOAMS 2008-A securitization. For example, Bank of America originated more than 70% of the loans through third party mortgage brokers. These loans, known as “wholesale mortgages,” were riskier than similar mortgages originated directly by Bank of America. More significantly, at the same time Bank of America was finalizing this deal, it was receiving a series of internal reports that showed an alarming and significant decrease in the quality and performance of its wholesale mortgages. According to the complaint, Bank of America did not disclose that important information or the associated risks to investors.
Investors in the BOAMS 2008-A certificates have already suffered millions of dollars in losses and it is estimated that total losses sustained by investors will exceed $100 million.
FIRREA permits the Attorney General to commence civil actions to recover penalties from, among others, people who violate specified provisions of Title 18 of the United States Code, including 18 U.S.C. § 1001 (false statement to government) and 18 U.S.C. § 1014 (false statement to financial institution). In such actions, the civil penalties assessed may equal $1.1 million per violation, or, for a continuing violation, up to $1.1 million per day or $5.5 million, whichever is less pursuant to(12 U.S.C. § 1833(a)(b)(1)-(2); see also 28 C.F.R. § 85.3. The statute further provides that the penalty can exceed these limits to permit the recovery of the amount of monetary gain received from or the amount of monetary loss caused by the violations under 12 U.S.C. §1833a(b)(3).
Attorney Tompkins thanked the U.S. Securities and Exchange Commission, Division of Enforcement, Atlanta Regional Office for its significant cooperation. The case is being handled by Assistant United States Attorneys Daniel S. Ryan and Mark T. Odulio of the United States Attorney’s Office in Charlotte.
The RMBS Working Group is a federal and state law enforcement effort focused on investigating fraud and abuse in the RMBS market that helped lead to the 2008 financial crisis. The RMBS Working Group brings together more than 200 attorneys, investigators, analysts and staff from dozens of state and federal agencies including the Department of Justice, ten U.S. Attorneys’ Offices, the FBI, the SEC, the Department of Housing and Urban Development (HUD), HUD’s Office of Inspector General, the Federal Housing Finance Agency’s Office of Inspector General, the Office of the Special Inspector General for the Troubled Asset Relief Program, the Federal Reserve Board’s Office of Inspector General, the Recovery Accountability and Transparency Board, the Financial Crimes Enforcement Network, and more than ten state Attorneys General offices around the country.
The RMBS Working Group is led by five co-chairs: Acting Assistant Attorney General for the Criminal Division Mythili Raman, Assistant Attorney General for the Civil Division Stuart Delery, Co-Director of the SEC’s Division of Enforcement George Canellos, U.S. Attorney for the District of Colorado John Walsh and New York Attorney General Eric Schneiderman.
Learn more about the Residential Mortgage- Backed Securities Working Group and the Financial Fraud Enforcement Task Force at www.stopfraud.gov.
A copy of DOJ's civil complaint against Bank of America is available here: BofA Civil Complaint
For more information on the SEC’s charges against Bank of America, please visit:www.sec.gov/News/PressRelease/Detail/PressRelease/1370539751924.
Defendant Sentenced for Cashing Fraudulent Government ChecksRead the Press Release
United States Attorney Kenyen R. Brown of the Southern District of Alabama announced that Lillian Givens was sentenced today in front of the Honorable Kristi K. DuBose to a term of three (3) years Probation for two counts of violating Title 18, U.S. Code Section 513(a), making counterfeit securities. In addition, the Defendant was ordered to pay restitution in the amount of $35,240.61 to the State of Alabama.
This case was investigated by USDA, OIG and prosecuted by AUSA Gregory A. Bordenkircher.
Court of Appeals Denies Joseph L. Bruno’s Interlocutory AppealRead the Press Release
Former New York State Senate Majority Leader Will Face Retrial
ALBANY, NEW YORK - In an opinion issued today in United States v. Joseph L. Bruno, the United States Court of Appeals for the Second Circuit affirmed Chief U.S. District Judge Gary L. Sharpe’s decision to deny Bruno’s motion to dismiss the superseding indictment on double jeopardy grounds. The opinion clears the path for trial, and Chief Judge Sharpe has scheduled a status hearing on August 13th at 3:00 p.m.
In December of 2009, a jury convicted the former majority leader of the New York State Senate of two counts of honest services fraud. Then, in 2010, the United States Supreme Court decided United States v. Skilling, holding that the honest services statute criminalizes only fraudulent schemes involving bribes or kickbacks. In light of Skilling, Bruno’s conviction was vacated, but (on November 16, 2011) the Court of Appeals held that the Double Jeopardy Clause of the Fifth Amendment did not bar retrial of Bruno on an indictment that charged honest services fraud based a bribery or kickback theory because the evidence presented at trial was sufficient for a reasonable jury to find that Bruno accepted “payments that were intended to and did influence his conduct as a public official,” and that “Bruno’s actions deprived New York citizens of his honest services as a New York senator under the standard announced in Skilling.” After a federal grand jury returned a superseding indictment on May 3, 2013, Bruno filed a motion to dismiss the indictment on double jeopardy grounds. Chief Judge Sharpe denied the motion, and Bruno filed the interlocutory appeal denied today.
This case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorneys Elizabeth C. Coombe and William C. Pericak. United States Attorney Richard S. Hartunian announced that, consistent with the decision by the Court of Appeals, the U.S. Attorney’s Office will seek resolution of this case by trial as soon as possible.
Cook Sentenced to 36 Months in Prison in Connection with Mortgage Fraud SchemeRead the Press Release
Ordered to Pay Almost $2 million in Restitution; Victims of Scheme Include Students and Mortgage LendersSALT LAKE CITY – Keith Nelson Cook, age 57, of Emmett, Idaho, who pleaded guilty in March to three counts of mail fraud; three counts of wire fraud; and one count of money laundering in connection with a scheme to defraud students and mortgage lenders, will spend 36 months in federal prison. Cook is a former resident of Layton and Salt Lake County.
U.S. District Judge Richard J. Shelby imposed the sentence Monday afternoon in U.S. District Court. Cook was ordered to pay $1,905,651.68 in restitution to victims of his fraud scheme. He will be on supervised release for 36 months after he completes his prison sentence.
From 2006 through 2011, Cook controlled a number of companies, including Avalon Group; Avalon Management Group LLC; White Mountain Management, Inc.; TNA Resource Consulting, LLC; The Turnberry Group; and Desert Management Group. As a part of a plea agreement reached with federal prosecutors, Cook admitted he devised a scheme to use these entities to obtain money and property from students and mortgage lenders.
According to the plea agreement, Cook, or individuals working under his direction, recruited students willing to pay a fee to be coached in the art of investing in real estate at a profit. During this recruitment effort, Cook hired people to mass market the real estate program opportunity by phone. During the calls, individuals acting at Cook’s direction made one or more fraudulent statements, including telling students that he was a nationally recognized real estate expert who had made millions of dollars syndicating apartment and commercial properties in California; telling them that he was looking for students to become a part of his “Success Team” and guaranteeing that the student’s participation in his program would result in either doubling the student’s income or a gain of $50,000 during the first year of participation, among many other things.
Cook concealed the fact that he had felony convictions in Utah for fraud and in California for grand theft.
Cook solicited payments of between $15,000 and $30,000 from prospective students, and also received the students’ financial and credit information in order for them to become part of the Success Team. Cook admitted that after accepting the application fees, he immediately began ignoring certain students and refused to take their telephone calls or talk to them. He refused to provide the promised coaching and diverted the $15,000 to $30,000 application fees for those dropped students for his own unauthorized business or personal use. According to the plea agreement, Cook solicited $427,500 from students.
Cook admitted that he induced certain students to become straw buyers of residences in Salt Lake County, causing the purchase and sale of a number of residential properties. He represented to the straw buyers that they would not have to make a down payment or invest any money of their own to buy the home; that the straw buyer would have no financial risk from the transaction and would have no obligation to make loan payments, among other things. Likewise, a number of misrepresentations were made to mortgage lenders.
Cook’s entities made payments on the properties to give the mortgage lenders the false impression that the loans were preforming appropriately. However, at some point he stopped making payments on the loans, leaving the straw buyers with mortgages they did not have the ability to repay and mortgage lenders with significant losses on the non-performing loans. The total loss amount incurred by the straw buyers and the mortgage lenders in the scheme was $1,905,651.68.
Cook admitted that he used the proceeds of the straw purchase scheme to pay personal expenses and to meet ongoing expenses related to his entities. For instance, in June 2007, he transferred or withdrew $70,500 from a business-account to purchase a cashier’s check.
Contract Counselor for Shelby County Juvenile Court Sentenced to Three Years for Health Care Fraud SchemeRead the Press Release
Memphis, TN – Mechell D. Toles, 44, of Collierville, TN, was sentenced today by United States District Court Chief Judge Jon Phipps McCalla to three years in prison following her guilty plea to one count of health care fraud, announced U.S. Attorney Edward L. Stanton III.
“While serving in a position of trust and being paid to help at-risk children, Dr. Toles instead brazenly helped herself to more than $600,000 of taxpayer monies by manipulating our nation’s health-care benefits system,” said U.S. Attorney Stanton. “Today’s sentence should serve as a clear reminder that there are stiff and severe consequences for violating the public’s trust.”
According to the Information and to statements made at the guilty plea and today’s sentencing, Toles – who has an undergraduate degree from Purdue University, a masters degree from the University of Mississippi, and a Ph.D. from Walden University – received referrals from the Shelby County Juvenile Court, which was the primary source of her counseling clientele. Hundreds of Toles’ patients were enrolled in TennCare, Tennessee’s Medicaid program. In western Tennessee, TennCare operates through two managed care organizations: Blue Care, which is associated with Blue Cross Blue Shield; and AmeriChoice, which is associated with United Health Care.
The investigation began after AmeriChoice audited Toles based on her high volume of counseling services and, upon finding incomplete documentation in her files, provided her with training on proper documentation and billing. The TennCare Office of Integrity referred the audit and inquiry into Toles’ billing practices to the Tennessee Bureau of Investigation on suspicion that she had engaged in health care fraud.
Investigators obtained billing information from the managed care organizations, reviewed correspondence and documentation from Juvenile Court, interviewed patients, surveilled Toles, and obtained a search warrant. The investigation revealed numerous occasions for which Toles billed for more than 24 hours of services in a single day. It also revealed instances in which Toles billed for counseling sessions on dates before patients had been referred to her and on dozens of dates after she had discharged patients. Toles’ files were largely devoid of any documentation of services provided, and patient records showed blank sheet after blank sheet for the purported dates of service. Based on billings for which there was no documentation of any services, investigators estimate at least $602,769.42 was billed by Toles and paid by TennCare for which no valid services were actually rendered.
# # # #
After her offices were searched, Toles was interviewed and admitted that her patient files were “horrible” and that only one or two were correct. She also admitted that she billed for services on dates when no services were provided. She claimed she was not sure how much money she had obtained, that she wanted to pay it back, that she did not have any particular need for the money – which had been spent – and that she knew at the time it was wrong but that it was just easy to do.
"The State of Tennessee has no tolerance for health care fraud. This is an example of a provider taking advantage of the system even when she knew it was wrong,” said Tennessee Bureau of Investigation Director Mark Gwyn. “TBI is glad to see the truth come to light and Dr. Toles appropriately sentenced."
In addition to the three-year prison sentence, Judge McCalla ordered Toles to pay $602,769.42 in restitution and to serve three years of supervised release. There is no parole in the federal prison system. This investigation was conducted by the Tennessee Bureau of Investigation. Assistant U.S. Attorney John Fabian represented the government.Cedar Rapids Drug User Pleads Guilty to Unlawful Possession of FirearmsRead the Press Release
A marijuana user who unlawfully possessed two guns pled guilty today in federal court in Cedar Rapids.
Eric Lavell Johnson, age 28, from Cedar Rapids, Iowa, was convicted of one count of possession of a firearm by an illegal drug user.
At the plea hearing, Johnson admitted he was an unlawful user of marijuana on February 19, 2013, when officers from the Cedar Rapids Police Department executed a search warrant at defendant's apartment in Cedar Rapids, Iowa. When officers breached the door, they saw defendant running from them, dropping several bags of marijuana. Defendant intended to flush the marijuana down the toilet to prevent officers from seizing the marijuana. In a closet in the apartment, officers found a duffel bag containing a digital scale and two firearms, a .22 caliber pistol and a .22 caliber rifle with a shortened stock. Defendant possessed the marijuana with the intent to distribute some or all of it to another person. Defendant told officers that he sold marijuana to make extra money to pay bills. A urine sample provided by defendant tested positive for THC, indicating marijuana use.
Sentencing before United States District Court Chief Judge Linda R. Reade will be set after a presentence report is prepared. Johnson remains in custody of the United States Marshal pending sentencing. Johnson faces a possible maximum sentence of ten years’ imprisonment, a $250,000 fine, $100 in special assessments, and three years of supervised release following any imprisonment.
This case is being prosecuted as part of Project Safe Neighborhoods, a cooperative local, state and federal program aimed at the enhanced prosecution of gun crimes. The case is being prosecuted by Assistant United States Attorney Daniel C. Tvedt and was investigated by the Cedar Rapids Police Department, the Federal Bureau of Investigation, and the Bureau of Alcohol, Tobacco, and Firearms.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 13-0039.
Camden County Man Indicted for Forced Sex TraffickingRead the Press Release
Human Trafficking Rescue Project
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Camden County, Mo., man was indicted by a federal grand jury today on charges related to the forced sex trafficking of two women.
Joshua Kain Smith, 35, of Camden County, was charged in a five-count indictment returned by a federal grand jury in Kansas City, Mo.
Today’s indictment charges Smith with one count of sex trafficking and one count of attempted sex trafficking. The indictment alleges that Smith used force, threats of force, fraud and coercion to cause a person (identified as “FV 1” – Female Victim 1) to engage in prostitution, from which he benefitted financially, between Nov. 15, 2011, and March 15, 2012. The indictment also alleges that Smith attempted to use force, threats of force, fraud and coercion to cause a person (identified as “FV 2” – Female Victim 2) to engage in prostitution, from which he benefitted financially, between Dec. 1, 2010, and Nov. 15, 2011.
Smith is also charged with one count of transporting “FV 1” across state lines for prostitution and two counts of transmitting a threat. Smith allegedly threatened to kill “FV 2” on Nov. 8, 2011, and to kill the mother and brother of “FV 1” on Dec. 20, 2011.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Cynthia L. Cordes. It was investigated by the FBI in conjunction with the Human Trafficking Rescue Project.
Businessman Pleads Guilty in Fraud SchemeRead the Press Release
PITTSBURGH, Pa. - A Pittsburgh-area businessman has pleaded guilty in federal court to charges of conspiracy, bribery of agent of an organization receiving federal funds and mail fraud, United States Attorney David J. Hickton announced today.
Arthur J. Bedway, Jr., 63, pleaded guilty to three counts before United States District Judge Cathy Bissoon.
In connection with the guilty plea, the court was advised that Bedway owned Victory Security. In order to obtain a contract with the City of Pittsburgh to install radios and mobile data terminals (MDTs) in City Police cars, Bedway created Alpha Outfitters, which he falsely represented to the City as a Women's Business Enterprise (WBE). He conspired with a city employee, Christine Ann Kebr and others, to obtain the MDT contract for Alpha Outfitters. Bedway paid Kebr for her assistance in obtaining the MDT contract.
Judge Bissoon scheduled sentencing for Nov. 20, 2013 at 10:00 a.m. The law provides for a total sentence of 35 years in prison, a fine of $750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.
Pending sentencing, the court continued bond.
Assistant United States Attorneys Robert S. Cessar and Lee J. Karl are prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and Internal Revenue Service - Criminal Investigation conducted the investigation that led to the prosecution of Bedway.
Blue Springs Man Indicted for Producing Child Porn, ObscenityRead the Press Release
Project Safe Childhood
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Blue Springs, Mo., man was indicted by a federal grand jury today for producing child pornography and child obscenity that victimized three children.
Jeffrey Laurence Treta, 46, of Blue Springs, was charged in a six-count indictment returned by a federal grand jury in Kansas City, Mo.
Today’s indictment charges Treta with two counts of producing child pornography.
Treta allegedly used a child victim (identified as “Jane Doe #1”) to produce child pornography on Jan. 19, 2013, and again on Jan. 29, 2013.Treta is also charged with two counts of producing child obscenity. Treta allegedly used another child victim (identified as “Jane Doe #2”) to produce child obscenity between May 1, 2012, and Jan. 29, 2013. Treta allegedly used a third child victim (identified as “Jane Doe #3”) to produce child obscenity between Jan. 1, 2012, and Jan. 29, 2013.
Today’s indictment also charges Treta with one count of possessing child pornography and one count of obstructing justice.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Katharine Fincham. It was investigated by the Blue Springs, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."Bgf Leader Tavon White Pleads Guilty to A Racketeering ConspiracyRead the Press Release
Ran the Operations of the BGF Gang Inside Baltimore Correctional Facilities
Baltimore, Maryland - Tavon White, a/k/a Bulldog and Tay, age 36, of Baltimore, Maryland pleaded guilty today to a racketeering conspiracy for running operations of the Black Guerilla Family (BGF) gang inside several correctional facilities.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Secretary Gary D. Maynard of the Maryland Department of Public Safety and Correctional Services; Baltimore Police Commissioner Anthony W. Batts; and Baltimore City State’s Attorney Gregg L. Bernstein.According to court documents, BGF has been the dominant gang at the Baltimore City Detention Center (BCDC), and in several connected facilities, including the Baltimore Central Booking Intake Center, the Women’s Detention Center, which houses many men, and in the Jail Industries Building.
According to his plea agreement, White has been a member of the BGF since 2000 and was in in pretrial custody at BCDC from 2009 to 2013. He became the lieutenant commander of the BGF at BCDC and then the commander in 2011. Throughout his years at BCDC, White was involved with and often directed the smuggling of contraband into BCDC, including cell phones, tobacco and drugs, through the services of correctional officers (CO’s), who received payments, gifts or a share of the profits. According to the plea agreement, White and his 24 co-defendants, including 13 correctional officers, participated in the smuggling enterprise and White also knew many other CO’s involved in contraband trafficking and sexual relations with inmates. White admitted that he was personally involved in sexual relationships with and impregnated four CO’s. Fellow BGF inmates and co-defendants also directed smuggling and often worked in concert with White. Outside the prison facility, White and his closest BGF allies frequently used other people, including several co-defendants, to obtain contraband, hold it or deliver it to correctional officers for smuggling.White faces a maximum sentence of 20 years in prison for the racketeering conspiracy. U.S. District Judge Ellen L. Hollander scheduled sentencing for February 20, 2014 at 10:00 a.m.
The case arose from the efforts of the Maryland Prison Task Force, a group of local, state and federal law enforcement agencies and prosecutors that met regularly for more than two years and generated recommendations to reform prison procedures. The investigation is continuing.
U.S. Attorney Rosenstein recognized the efforts of the other members of the Maryland Prison Task Force, including: Colonel Marcus L. Brown, Superintendent of the Maryland State Police; Chief Mark A. Magaw of the Prince George’s County Police Department; United States Marshal Johnny Hughes; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Tom Carr, Director of the Washington-Baltimore High Intensity Drug Trafficking Area; and Dave Engel, Executive Director of the Maryland Coordination and Analysis Center.
United States Attorney Rod J. Rosenstein praised the FBI, Maryland Department of Public Safety and Correctional Services, Baltimore Police Department, and Maryland Prison Task Force, for their work in the investigation and Baltimore City Assistant State’s Attorneys Kevin Wilson and Katie O’Hara who prosecuted White’s state case. Mr. Rosenstein thanked Assistant United States Attorneys Robert R. Harding and Ayn B. Ducao, who are prosecuting this Organized Crime Drug Enforcement Task Force case.13 Linked to Mexican Mafia and La Familia Indicted After Investigation Reveals Plot to Join Forces to Expand Drug Cartel’s Presence in U.S.Read the Press Release
Cartel Initiated Alliance with Prison Gang that is also Targeted in Second Indictment for Exercising Control Over Large South L.A. County Street Gang
LOS ANGELES – A coalition of federal, state and local authorities this morning arrested eight defendants named in a federal grand jury indictment that outlines an alliance between the Mexican Mafia prison gang and the La Familia Michoacàna drug cartel that sought to protect and expand the cartel’s drug trafficking activities across the nation.
The seven-count indictment – which names six members of the Mexican Mafia, three associates of the prison gang, and four people directly linked to the La Familia cartel – outlines a venture between the criminal organizations that participants referred to as the “Project,” and which involved the highest levels of La Familia. The indictment alleges that participants in the Project sought to give La Familia members “free rein” to sell methamphetamine in Southern California and to provide protection for incarcerated cartel members in exchange for money and methamphetamine going to Mexican Mafia members.
“Today’s salvo against the Mexican Mafia is part of a 20-year fight to curb the influence of the prison gang both inside prison walls and on the streets of Southern California,” said United States Attorney André Birotte Jr. “We successfully dismantled the gang’s leadership structure in prior cases, causing chaos throughout the organization. Now we have demonstrated our ability to stop the Mexican Mafia from realizing a new power base by disrupting the gang’s plot to establish a threatening alliance with a major drug trafficking organization.”
The indictment that outlines the Project and related drug trafficking activities names 13 defendants, eight of whom were arrested this morning. Four were already in custody prior to today’s arrests and one is a fugitive. During the course of this investigation, authorities seized more than 600 pounds of methamphetamine and charged an additional six defendants in state court.
A second indictment unsealed this morning concerns the Mexican Mafia and its control over the Florencia 13 criminal street gang in south Los Angeles County. This indictment charges 31 defendants and alleges violations of the federal racketeering (RICO) statute, as well as a host of narcotics, firearms, and fraud offenses. Florencia 13 is one of the largest, most powerful and oldest street gangs in Southern California. Several members of the gang have risen through its ranks to become leaders of the Mexican Mafia. The indictment unsealed today follows a 2007 crackdown on the gang that led to more than 100 members and associates being charged, and five of them receiving sentences of life without parole in federal prison (see: http://www.justice.gov/usao/cac/Pressroom/pr2010/025.html). The indictment unsealed today focuses on how the gang has generated illicit profits through the sale of drugs and firearms, fraud, and extortion. The indictment alleges that two incarcerated Mexican Mafia members are the leaders of the Florencia 13 gang, and that they directed the activities of the street gang from a California state prison and received payments derived from the gang’s illegal activities. During this morning’s takedown, 14 of the 31 defendants named in this indictment were taken into custody. Three of the defendants were previously arrested in this case before today’s enforcement activities, and eight are fugitives. An additional six defendants were already in custody prior to today’s takedown in connection with state charges.
“These two investigations disrupted the criminal activities of the Mexican Mafia, the Los Angeles street gang Florencia 13, and the Mexican Mafia’s relationship with the La Familia drug cartel, which is responsible for using firearms to commit violent crimes and trafficking hundreds of thousands of pounds of controlled substances into the United States,” Said Steven J. Bogdalek, ATF Special Agent in Charge of the Los Angeles Field Division. “By combining law enforcement resources, we were able to curtail their ability to build alliances and prevent their violence from spreading further into our communities.”
The Mexican Mafia is a powerful prison gang that controls much of the drug trade and other criminal activities within California state prisons, county jails and some federal prisons, according to the indictments unsealed this morning. The Mexican Mafia, whose members are generally senior members of street gangs such as Florencia 13, also exercises control over and directs the narcotics trafficking activities of Latino street gangs across Southern California and in prisons. The indictment concerning the Mexican Mafia-La Familia Project represents the largest crackdown on the prison gang’s members since the United States Attorney’s Office brought a series of RICO cases against the leadership of the prison gang in the 1990s.
La Familia Michoacana and it successor, Los Caballeros Templarios (the Knights Templar), is a major drug cartel based in the Mexican state of Michoacàn and “is responsible for the trafficking of hundreds of thousands of pounds of controlled substances, including methamphetamine, from Mexico into the United States,” according to the indictment.
The members of La Familia named in the indictment allegedly oversaw the distribution of methamphetamine and marijuana in the Southern California area, as well as provided money and drugs at discounted prices to members of the Mexican Mafia.
Anthony Williams, DEA Special Agent in Charge, commented: “This multi-agency, coordinated investigation identified a network of drug traffickers tied directly to one of the most violent Mexican drug cartels – La Familia or the Knights Templar. Today’s enforcement efforts will help to reduce the damaging impact of this brutal organization by arresting key members and associates of the La Familia cartel and disrupting their distribution networks in the Los Angeles area.”
As part of the alliance between the criminal enterprises, the indicted members and associates of the Mexican Mafia helped La Familia distribute narcotics “by ordering, instructing, and informing Hispanic gang members to protect La Familia drug shipments and sales, to prevent criminal taxation of La Familia drug shipments and sales, and to collect drug debts,” according to the indictment, which also alleges that Mexican Mafia members would protect incarcerated members of La Familia.
Los Angeles County Sheriff Lee Baca stated: “The successful results of this joint operation allowed law enforcement to intervene in the development of a very strong and powerful merger between dangerous criminal organizations. We believe that we have initiated a crippling effect to those members who are still loyal to the Mexican Mafia criminal organization.”
Larry Miranda, Chief of the Office of Correctional Safety for the California Department of Corrections and Rehabilitation, said: “One of the most chilling aspects of this investigation was the budding relationship between the Mexican Mafia and the La Familia/Knights Templar, showing how two powerful organizations attempted to combine their efforts to control prison facilities and the communities in which we live. The investigators have done a magnificent job at thwarting this relationship. Their tireless efforts, commitment to their agencies, and dedication to their communities have led law enforcement to a victory in the continuing battle against the gangs and drugs that plague our communities.”
Those named in the indictment are:
Jose Rodriguez-Landa, also known as “Fox” and “Fox Tapia,” 49, of Michoacàn, an alleged Mexican Mafia member currently in custody in a Los Angeles County jail;
Michael Moreno, aka “Boo,” 55, of Fresno, an alleged member of the Mexican Mafia, who was arrested this morning;
Fred Anthony Montoya, aka “Fast Freddy,” 46, of Antioch, California, an alleged Mexican Mafia member who is currently in custody in a California state prison;
Freddie Montes, 44, of Castaic, an alleged member of La Familia, who was arrested this morning;
Luis Gerardo Vega, aka “Little” and “Little One,” 30, of the Pico-Union district of Los Angeles, an alleged Mexican Mafia member who is currently in custody in a Los Angeles County jail;
Manuel Larry Jackson, aka “Cricket,” 49, of Monterey Park, an alleged Mexican Mafia member, who was arrested this morning;
Jimmy Ruben Soto, aka “Rube” and “Old Man,” 77, of Visalia, an alleged member of the Mexican Mafia, who was arrested this morning;
Raymond Lozano, 36, of San Diego, an alleged Mexican Mafia associate who is currently incarcerated in a federal prison;
Efrain Isak Rosales, aka “Tucàn,” 35, an alleged member of La Familia who resides in Michoacàn and who is currently being sought by authorities;
Sonia Apodaca, aka “Shorty,” 44, of El Monte, an alleged “secretary” of the Mexican Mafia, who was arrested this morning;
Claudia Garcia, aka “Giggles,” 42, of the Gramercy Park district of Los Angeles, an alleged associate of the Mexican Mafia, who was arrested this morning;
Adam Rios, aka “Blanco,” 35, of Slymar, an alleged associate of La Familia, who was arrested this morning; and
Omar Hugo Robles, 30, of Sylmar, an alleged associate of La Familia, who was arrested this morning.
All 13 defendants are charged in count one of the indictment, which outlines the Mexican Mafia-La Familia alliance and alleges a conspiracy to distribute narcotics. Various defendants are charged in six other counts in the indictment that allege substantive narcotics-distribution offenses, five of which relate to methamphetamine and one of which concerns marijuana.
The conspiracy charge and the counts related to methamphetamine each carry a mandatory minimum sentence of 10 years in federal prison (20 years if the defendant has a prior drug conviction, which may affect about half of the defendants in the indictment) and a maximum statutory sentence of life without parole. The marijuana count carries a mandatory minimum sentence of five years in federal prison (10 years if the defendant has a prior narcotics conviction) and a statutory maximum sentence of 40 years in prison.
The indictments targeting the Mexican Mafia and the La Familia drug cartel are the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Los Angeles Sheriff’s Department; and the Los Angeles High Intensity Drug Trafficking Area (HIDTA)/Southern California Drug Task Force, a federally funded group led by the Drug Enforcement Administration (DEA). The Southern California Drug Task Force is comprised of federal and local law enforcement agencies, including the DEA, the ATF, the Los Angeles Police Department and the Pasadena Police Department.
This investigation into the Mexican Mafia started in May 2010 and also involved the Montebello Police Department, the Bakersfield Police Department, the Long Beach Police Department, the Glendale Police Department, the United States Marshals Service, the United States Secret Service, the Stanislaus Drug Enforcement Agency, the United States Bureau of Prisons, the California Department of Corrections and Rehabilitation-Special Services Unit, and the Huntington Park Police Department.
Release No. 13-100
5 August 2013
Whiteriver Man Found Guilty of Sexual AbuseRead the Press Release
PHOENIX– Christopher James, 37, of Whiteriver, Ariz., was found guilty by a federal jury on Aug. 2, 2013, of two counts of sexual abuse. The case was tried before U.S. District Judge Neil V. Wake beginning on July 30, 2013. The defendant is being held pending sentencing which is set for Nov. 4, 2013.
The evidence at trial showed that on Aug. 3, 2011, on the Fort Apache Indian Reservation, James sexually abused a victim who was physically incapable of communicating an unwillingness to participate in a sex act, as a result of a physical disability, as well as cognitive and developmental delay.
A conviction for sexual abuse carries a maximum penalty of life imprisonment, a $250,000 fine or both.
The investigation in this case was conducted by the Bureau of Indian Affairs. The prosecution was handled by Dimitra H. Sampson and Christina Reid-Moore, Assistant U.S. Attorneys, District of Arizona, Phoenix.
CASE NUMBER: CR-2011-8206-PCT-NVW
RELEASE NUMBER: 2013-061_JamesFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
U.S. Forest Service Implements Closure Order to Prohibit Use of Exploding Targets on National Forest and Grasslands in Rocky Mountain RegionRead the Press Release
Exploding targets have started at least 16 wildfires since 2012 on Forest Service lands in 8 western states, with 7 of those fires occurring in the Rocky Mountain Region causing the federal government to spend approximately $33.6 million in suppression costs
DENVER – The U.S. Forest Service Rocky Mountain Region, working closely with the U.S. Attorney’s Office, today announced that the Regional Forester has signed a regional closure order prohibiting un-permitted explosives on national forest system lands, specifically to prohibit the use of exploding targets.
The closure order was announced by U.S. Attorney John Walsh, Rocky Mountain Regional Forester Dan Jiron, and U.S. Forest Service Rocky Mountain Region Special Agent in Charge Laura Mark during a press conference about the wildfire danger caused by exploding targets.
“Enjoying your public lands is what we encourage and promote every day,” said Regional Forester Jiron. “Hunting and target shooting are welcome recreational experiences on national forest system lands. We just want visitors to have safe and enjoyable experiences."
Exploding targets have been identified as the cause of at least 16 wildfires in the western states, costing taxpayers over $33,000,000 in fire suppression costs. The order applies to all un-permitted explosives, but focuses on exploding targets. The closure order includes all national forests and grasslands in the five-state Rocky Mountain Region. Those states include: Colorado, Wyoming, Kansas, Nebraska, and South Dakota.
Exploding targets can be purchased legally and are intended for use as a target for firearms practice. Exploding targets generally consist of two or more separate chemical components that become an explosive when mixed together. The powder components are kept separate within individual containers for sale and transport. Once mixed, however, the components become explosive, and thus are subject to federal explosive laws and regulations.
The targets explode when struck by a bullet. When detonated, exploding targets often result in a fireball that can ignite vegetation and surrounding materials. The explosion also causes other risks to an individual’s health and safety.
Under the Order, if caught using an exploding target, the user can face a fine of up to $5,000 and imprisonment of not more than 6 months.
“The top priority is for people to be safe. The public should know that exploding targets pose serious dangers, not just in their actual explosion, but in the wildfires they can start,” said U.S. Attorney John Walsh. “By barring the use of exploding targets, today’s action will prevent wildfires and protect the public, including first responders who often come across the explosive. It’s important to note that the Forest Service’s new order does not affect or change the rules regarding target shooting or other safe uses of firearms in the national forest, but only prohibits the use of exploding targets that start wildfires.”
“Exploding targets pose a very real safety threat to visitors and our employees” said U.S. Forest Service Chief Tom Tidwell. “In the past year alone, at least 16 wildfires on national forests have been associated with exploding targets, causing millions of dollars in suppression costs while threatening the safety and well-being of surrounding communities.”
“We have seen a significant increase in the use of exploding targets on National Forest lands within the Region” said U.S. Forest Service Regional Special Agent in Charge Laura Mark. “Our objective is to educate the public on the dangers associated with the use of these targets in vegetation that can ignite a fire, as well as the safety risk they pose to the public, our employees and first responders. In addition to the seven fires caused by exploding targets on national forests in the Region since 2012, explosives ordinance demolition experts have had to respond on three occasions this year to safely dispose of unused targets that had been mixed but not yet used.”
“The Bureau of Land Management (BLM) is working on a Fire Prevention Order that will ban exploding targets on BLM lands in Colorado as well,” said John Bierk, State Staff Ranger for BLM Colorado/Eastern States.
####
U.S. Attorney Timothy Purdon to Take Part in National Night OutRead the Press Release
BISMARCK – U.S. Attorney Timothy Purdon will join law enforcement and community leaders on Tuesday, August 6, 2013, at Elmwood Park in West Fargo, N.D., from 5:00 p.m. to 9:00 p.m. as part of the 30th Annual National Night Out crime and drug prevention event.
National Night Out is designed to heighten crime and drug prevention awareness; generate support for and participation in local anti-crime efforts; strengthen neighborhood spirit and police-community partnerships; and send a message to criminals letting them know neighborhoods are organized and fighting back.
U.S. Attorney Purdon said, “National Night Out is a perfect opportunity for neighbors to join with their law enforcement and community partners to demonstrate that crime does not rule the night and that criminals have no safe haven when the sun goes down. I look forward to joining my colleagues on Tuesday to help continue to spread the important message that we are all in this together.”
National Night Out organizers are expecting over 16,000 communities and 38 million people nationwide to take part in community events on Tuesday.
U.S. Attorney Michael J. Moore to Take Part in National Night OutRead the Press Release
United States Attorney Michael J. Moore will join law enforcement and community leaders on Tuesday, August 6, 2013 at 11:00 a.m. at Macon City Hall as part of the 30th Annual National Night Out crime and drug prevention event.
National Night Out is designed to: Heighten crime and drug prevention awareness; Generate support for and participation in local anticrime efforts; Strengthen neighborhood spirit and police-community partnerships; and send a message to criminals letting them know neighborhoods are organized and fighting back.
“National Night Out is a perfect opportunity for neighbors to join with their law enforcement and community partners to demonstrate that crime does not rule the night and that criminals have no safe haven when the sun goes down. I look forward to joining my colleagues on Tuesday to help continue to spread the important message that we are all in this together,” said U.S. Attorney Michael Moore.
National Night Out organizers are expecting over 16,000 communities and 38 million people nationwide to take part in community events on Tuesday.U.S. Attorney Barry Grissom to Take Part in National Night OutRead the Press Release
KANSAS CITY, KAN. – U.S. Attorney Barry Grissom will join law enforcement and community leaders on Tuesday, Aug. 6, at the Night Out Against Crime. The event runs from 4 p.m. to 8 p.m. at the National Guard Armory near 18th and Ridge in Kansas City, Kan. Speakers begin at 6 p.m.
The event is part of the 30th Annual National Night Out, which is designed to heighten crime and drug prevention awareness, generate support for and participation in local anti-crime efforts; strengthen neighborhood spirit and police-community relationships; and send a message to criminals letting them know neighborhoods are organized and fighting back.
“Crime does not rule the night and criminals have no safe haven when the sun goes down,” Grissom said. “National Night Out is a perfect opportunity for neighbors to join with their law enforcement and community partners to send the message. I look forward to joining my colleagues on Tuesday to help spread the word that we are all in this together.”
National Night Out organizers are expecting more than 16,000 communities and 38 million people nationwide to take part in community events on Tuesday.
U.S. Attorney Barry Grissom to Address Immigration Enforcement and Civil RightsRead the Press Release
KANSAS CITY, KAN. – U.S. Attorney Barry Grissom will speak on immigration enforcement and civil rights during the third annual Statewide Civil Rights Symposium Friday, Aug. 9, at Johnson County Community College in Overland Park, U.S. Attorney Barry Grissom said today.
“We need to take a pragmatic approach to immigration enforcement that makes efficient use of our resources and recognizes the human rights of an estimated 11 million undocumented workers in this country,” Grissom said.
Grissom will be one of several speakers at the free, day-long event focusing on federal civil rights enforcement in Kansas. Featured speaker for the event will be Gretchen Eick Ph.D., professor emeritus of history at Friends University. She will draw upon her book, “Dissent in Wichita: The Civil Rights Movement in the Midwest, 1954-1972,” when she speaks. Through protests such as the sit-in at the Dockum Drugstore in Wichita in 1958, civil rights advocates applied pressure leading up to the landmark Civil Rights Act of 1964.
Grissom said this is the third year in a row his office has sponsored the symposium. The U.S. Department of Justice is responsible for upholding the civil and constitutional rights of all Americans. It enforces federal statutes prohibiting discrimination on the basis of race, color, sex, disability, religion, familial status and national origin.
Other presentations during the symposium will include a panel discussion on civil rights with panelists U.S. Attorney Barry Grissom; Gary Brunk, executive director of the ACLU of Kansas and Western Missouri, and Thomas Witt, executive director of the Kansas Equality Coalition.
The symposium is free and open to the public, but anyone who wants to attend must register. A registration form and more information is available on the U.S. Attorney’s Web site at www.justice.gov/usao/ks
Sponsors for the event include the U.S. Attorney’s Office for the District of Kansas, the U.S. Attorney’s Office for the Western District of Missouri, the Kansas Law Enforcement Training Center, the Public Safety Training Center at Johnson County Community College and the Regional Community Policing Training Institute at Wichita State University.
For more information call Jim Cross, public information officer, at 316-269-6481.
U.S. Attorney Barbara L. McQuade and Detroit Police Chief James Craig to Take Part in National Night OutRead the Press Release
U.S. Attorney Barbara L. McQuade and Detroit Police Chief James Craig will join law enforcement and community leaders on Tuesday, August 6th at the Detroit Police Department’s 6th and 8th Precincts, 11450 Warwick at 5 p.m. as part of the 30th Annual National Night Out crime and drug prevention event.
National Night Out is designed to heighten crime and drug prevention awareness; generate support for and participation in local anti-crime efforts; strengthen neighborhood spirit and police-community partnerships; and send a message to criminals letting them know neighborhoods are organized and fighting back.
United States Attorney Barbara L. McQuade stated, "This is an important moment in Detroit's history. We want to use the opportunity of National Night Out to let all citizens in Detroit know that despite the City's financial challenges, the partnership between law enforcement and the community is stronger than ever. Through the Detroit One initiative, we are working together to protect public safety. "
U.S. Attorney McQuade and Chief Craig will hold a press availability beginning at 5:30 p.m. to discuss crime issues facing the city and the Detroit One Anti-Violence Initiative. The media is encouraged to attend the event. Please contact Gina Balaya, Public Information Officer, United States Attorney’s Office at (313)226-9758 if you need further assistance.
National Night Out organizers are expecting over 16,000 communities and 38 million people nationwide to take part in community events on Tuesday.
Two Men Charged with Defrauding Charter Flight Company, Other Luxury Brands, of Hundreds of Thousands of DollarsRead the Press Release
NEWARK, N.J. – Two men were arrested by federal agents early this morning in Akron, Ohio, for conspiracy to defraud an aviation company out of charter flights and other businesses out of services and luxury goods, U.S. Attorney Paul J. Fishman announced.
Dante G. Dixon, 45, of Miami, Fla., and Christopher L. Henderson, 32, of Akron, Ohio, were charged by Complaint with conspiracy to commit wire fraud. They made their initial court appearances before U.S. Magistrate Judge Kathleen Burke in Akron federal court and were ordered held until they can be transported to New Jersey.
According to the Complaint:From May 2013 through June of 2013, Dixon and Henderson and others allegedly conspired to fraudulently obtain at least four private charter flights from Jet Aviation, an international business aviation service with its United States’ headquarters in Teterboro, N.J. Dixon, Henderson and others also conspired to obtain tens of thousands of dollars in other luxury goods and services, all via sham lines of credit issued to a well-known financial institution for the defendants and others’ use, by misrepresenting that they and others were employees at the financial institution.
On May 5, 2013, an individual using the name “Josh Stevens” called Jet Aviation’s offices in Chicago, Ill., and Van Nuys, Calif., to inquire about its private charter flight services. That individual identified himself as being employed as a senior vice president at a well-known financial institution and provided an email address purporting to be affiliated with the financial institution. It was later determined that this email address was not, in fact, affiliated with the financial institution. A Jet Aviation employee sent an email to the provided email address. The email from Jet Aviation contained a draft Charter Services Agreement, which was signed by “Josh Stevens” and returned to Jet Aviation on May 9, 2013. The Agreement falsely listed “Josh Stevens” as a senior vice president, Dixon as a vice president, and Henderson as a vice president of international affairs at the well-known financial institution.
On May 21, 2013, based on the false information provided by “Josh Stevens,” a Jet Aviation employee created an account and a $350,000 line of credit for the defendants and others. The line of credit was in the name of the financial institution on behalf and for the use of the defendants and others. Dixon and Henderson and others used the sham line of credit to take at least four private charter flights.
On June 7, 2013, a Jet Aviation employee at Teterboro met Dixon and Henderson before they boarded their charter flight to Miami, Florida. During the meeting, the defendants identified themselves as being employees at the financial institution. The Jet Aviation employee then contacted the financial institution and was informed that Dixon and Henderson and others were not, and had never been, employees at the financial institution.
As a result of their misrepresentations to Jet Aviation, Dixon and Henderson and others fraudulently obtained private high-end charter flights and limousine car services, with a total value of $175,790. Jet Aviation never received payment from the defendants and others, or from the financial institution’s line of credit, for any of the services provided to the defendants and others, including the approximately $164,911 in charter flights and the approximately $10,879 in limousine services.
Dixon and Henderson and others made similar misrepresentations about their purported employment at the financial institution to other luxury service providers, including to a Tiffany & Co. store in Bal Harbour, Fla., and to The W South Beach Hotel in Miami, Fla. These misrepresentations resulted in the defendants and others fraudulently obtaining, via sham lines of credit with Tiffany and The W, approximately $19,991 in watches, sunglasses, sterling silver and leather business cardholders, and men’s cologne from Tiffany, and approximately $25,466 in overnight hotel stays at The W.
The investigation has revealed that the financial institution was not aware that Dixon and Henderson and others were using its corporate identity. As a result of their scheme, Dixon and Henderson and others fraudulently obtained more than $220,000 in luxury goods and services.The charge of conspiracy to commit wire fraud with which the defendants are charged is punishable by a maximum potential penalty of 20 years in prison, and a maximum fine of $250,000 or twice the gain or loss resulting from the defendants’ crimes.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford, with the investigation leading to today’s arrests.The government is represented by Assistant U.S. Attorney Aaron Mendelsohn of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
13-320Dixon-Henderson Complaint
Trumbull Man Admits Involvement in Organized Crime-controlled Gambling RingRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that RICHARD UVA, also known as “Big Baldy,” 44, of Trumbull, formerly of Stamford, pleaded guilty today before United States Magistrate Judge Thomas P. Smith in Hartford to one count of conspiring to violate the federal Racketeer Influenced and Corrupt Organizations (RICO) Act stemming from his involvement in organized-crime controlled gambling businesses.
According to court documents and statements made in court, after a long-term investigation led by the FBI Fairfield County Organized Crime Task Force, the Internal Revenue Service – Criminal Investigation and the Stamford Police Department, UVA, Dean DePreta and 18 other individuals were charged with various offenses related to their involvement in an illegal Internet sports bookmaking operation and illegal card gambling clubs in Stamford and Hamden. UVA and DePreta are alleged associates of the Gambino organized crime family.
The investigation, which included the use of court-authorized wiretaps, revealed that UVA assisted DePreta’s operation of a large-scale sports bookmaking business in which gamblers placed bets with offshore Internet sports-gambling websites, particularly www.44wager.com based in Costa Rica. UVA served as the “master agent” for the bookmaking operation.
In addition, DePreta, UVA and others operated a card gambling club at 2965 State Street in Hamden, where a house percentage, commonly referred to as a “rake,” was collected from every hand played. UVA supervised the club’s operation.
In pleading guilty, UVA also admitted that he committed acts of extortion while participating in this racketeering enterprise. UVA collected “tribute” payments from independent sports bookmakers operating in Connecticut, which payments were subsequently delivered to Gambino Family associates in New York.
UVA is scheduled to be sentenced by United States District Judge Vanessa L. Bryant on October 24, 2013, at which time he faces a maximum term of imprisonment of 20 years. He also has agreed to forfeit $250,000.
UVA has been released on bond since his arrest on June 13, 2013.
DePreta has pleaded guilty and awaits sentencing.
FBI analysis of the sports-betting web site utilized by the co-defendants has determined that the total gross revenues of the Stamford-based gambling operation were nearly $1.7 million from October 2010 to June 2011.
To date, the defendants who have pleaded guilty have agreed to forfeit more than $1.3 million.
This matter is being investigated by the FBI Fairfield County Organized Crime Task Force, the Internal Revenue Service – Criminal Investigation, the Stamford Police Department, the Bridgeport Police Department and the Connecticut State Police. This case is being prosecuted by Assistant United States Attorneys Hal Chen and Peter Jongbloed.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Suspect in Shooting of Highway Patrol Officer Pleads Guilty to Federal ChargeRead the Press Release
Faces up to Ten Years Imprisonment for Firearm OffenseGREENSBORO, N.C. – Mikel Edward Brady II pleaded guilty today to a federal firearm charge, announced Ripley Rand, United States Attorney for the Middle District of North Carolina.
Brady, age 24, of Durham, North Carolina, was indicted on May 28, 2013, for possession of a firearm and possession of ammunition by a convicted felon following an investigation into the February 18, 2013, shooting of Trooper Michael Potts of the North Carolina State Highway Patrol. Brady pleaded guilty to possession of a firearm by a convicted felon. He faces up to ten years imprisonment, up to three years supervised release, and a fine of up to $250,000.
Sentencing is set for November 25, 2013, in Greensboro, before Chief United States District Judge William L. Osteen, Jr. Assault and other charges against Brady related to the shooting of Trooper Potts remain pending in state court.
The case was investigated by the United States Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Durham Police Department and is being prosecuted by Special Assistant United States Attorney/Durham County Assistant District Attorney Kyle Pousson.
Suitland Pcp Dealer Sentenced to 12 Years in PrisonRead the Press Release
Greenbelt, Maryland - U.S. District Judge Roger W. Titus sentenced Shareef Muhammad, age 34, of Suitland, Maryland, today to 12 years in prison, followed by five years of supervised release, for conspiracy to possess with intent to distribute phencyclidine (PCP), crack cocaine and heroin.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Karl C. Colder of the Drug Enforcement Administration - Washington Field Division; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Chief Cathy L. Lanier of the Metropolitan Police Department; and Chief Mark A. Magaw of the Prince George’s County Police Department.
According to Muhammad=s guilty plea, from at least June 2010 through February 2012, he was a part of a drug trafficking conspiracy led by Samuel Braxton and based in and around Temple Hills, Maryland. Braxton regularly received multi-ounce to quarter-gallon quantities of PCP as well as heroin, crack and powder cocaine from his sources of supply. Braxton sold the PCP, heroin, and crack to Muhammad and other drug customers in the Washington, D.C. metropolitan area, including Prince George’s County.
In August 2011, law enforcement made two purchases of PCP from co-conspirator Cortez Winston, totaling about 16 ounces of PCP. Muhammad had supplied Winston with the PCP, which he had obtained from Braxton. On September 9, 2011, law enforcement arrested Muhammad in southeast Washington, D.C. and seized from Muhammad’s vehicle approximately 31 ounces of PCP which he had obtained from Braxton.
Over the course of the conspiracy Muhammad was responsible for the distribution of at least three kilograms of PCP, 28 grams of crack cocaine and 100 grams of heroin.
Judge Titus also found that Muhammad attempted to obstruct justice. According to Muhammad’s plea agreement, on August 3, 2012, while he was in prison, Muhammad mailed a letter to an associate, instructing that person to bring a second enclosed letter to another individual. Muhammad instructed that the second individual should deliver the second letter to Muhammad’s co-defendant, have Muhammad’s co-defendant re-write the letter, and have it notarized. The second letter appeared to have been drafted by Muhammad and had the co-defendant denying that he/she had ever obtained drugs from or discussed drugs with Shareef Muhammad.
A total of 15 members of the conspiracy have been convicted, including Samuel Braxton, age 44, of Temple Hills, Maryland; Mac “Easy” Holland, age 40, of Upper Marlboro, Maryland; and Norman Lee, Jr., age 36, of Washington, D.C., who were sentenced to 27 years in prison, 15 years in prison and 188 months in prison, respectively. Cortez Winston, age 22, of Suitland, Maryland, also pleaded guilty and is scheduled to be sentenced on October 21, 2013.
United States Attorney Rod J. Rosenstein commended the DEA, FBI, Metropolitan Police Department and Prince George’s County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Christen A. Sproule, Steven E. Swaney, and Arun Rao, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Smoke Shop Owners Convicted of Structuring Financial TransactionsRead the Press Release
CORPUS CHRISTI, Texas – The husband and wife owners of Mr. Nice Guys Smoke Shop have entered pleas of guilty as a result of the efforts of a multi-agency investigation, United States Attorney Kenneth Magidson announced today. Leroy Mitchan Jr., 33, and Kimberly Davis, 27, both of Corpus Christi, pleaded guilty just a short time ago to structuring financial transactions as charged in a superseding indictment filed June 12, 2013.
Mitchan and Davis were arrested in May 2013 on charges relating to their participation in a conspiracy to structure more than $100,000 in cash deposit transactions over a 12-month period with a domestic financial institution in order to avoid the legal reporting requirements of the bank.
Their arrests came as a result of an investigation in reference to the sale of synthetic marijuana. Mitchan and Davis also own another smoke shop located at 5433 S. Staples St. in Corpus Christi as well as a used car dealership located at 5757 Everhart Rd. The factual summary as presented in court indicated that from February 2012 through January 2013, officers with the Corpus Christi Police Department (CCPD) seized more than 40.93 grams of synthetic marijuana during numerous undercover purchases from both of the smoke shops. On Feb. 1, 2013, CCPD executed state search warrants at the shops and seized a total of 1.5 kilograms of synthetic marijuana as well as various smoking paraphernalia such as pipes, bongs, glassware, grinders and scales. Also seized were detailed drug ledgers and price lists relating to the sale of synthetic marijuana along with documents guiding employees on the proper coded vocabulary to use when describing the illegal items being sold to customers.
The Drug Enforcement Administration (DEA) learned Mitchan and Davis had recently purchased three real estate properties in Corpus Christi and were making payments on these properties with large cash transactions. A preliminary review of bank accounts revealed several cash deposits under $10,000. Internal Revenue Service – Criminal Investigation (IRS-CI) then initiated the financial investigation.
The Bank Secrecy Act of 1970 (BSA) requires financial institutions to file reports with the Treasury Department of cash transactions exceeding $10,000.
As part of the plea, Davis admitted she conducted three separate deposits in one morning at Members First Credit Union. She first deposited $9,000 in the drive-thru at 7:39 a.m., then drove away and immediately re-entered the drive-thru lane and conducted a second cash deposit of $9,000 at 8:17 a.m. She drove away again but returned and conducted a third cash deposit of $8,801 at 9:16 a.m. In another instance, she conducted two separate deposits right after the other – the first in the lobby of the bank and the another in the drive-thru lane approximately 30 minutes later. The total amount for all five deposits was $44,101. All of these deposits did not exceed the $10,000 currency transaction filing requirement for financial institutions and were made in an attempt to avoid the reporting requirements.
Mitchan admitted he worked with a local real estate agent and provided him with large amounts of cash. Mitchan told him to deposit it into his personal bank account and later withdraw the money in the form of cashier’s checks or via Moneygram to pay for property he was purchasing. The total amount structured at the direction of Mitchan was approximately $461,000. Mitchan directed him and others to structure currency transactions to avoid the threshold reporting requirement and had even asked about the success of structuring the money without having any of the bank tellers ask any questions.
Mitchan faces up to 10 years imprisonment and a fine up to $500,000, while Davis faces up to five years and a possible 250,000 fine. Sentencing is set for Nov. 18, 2013. Both were permitted to remain on bond pending that hearing.
Both defendants have also agreed to the criminal forfeiture of three pieces of real property located in Nueces County, valued at approximately $1,200,000, approximately $396,000 in cash as well as 42 vehicles valued at approximately $409,000.
The investigation leading to the criminal charges was conducted in Corpus Christi lead by IRS-CI, DEA and CCPD. The case is being prosecuted by Assistant Unites States Attorneys Hugo R. Martinez and Lance A. Watt.
Six Now Convicted in Alien Smuggling ConspiracyRead the Press Release
HOUSTON – With the guilty plea of Mexican national Francisco Chao-Martinez, 31, six people have now been convicted in relation to a conspiracy to transport aliens illegally present in the country, United States Attorney Kenneth Magidson announced today. Chao-Martinez was among six originally charged in an ongoing conspiracy to enrich themselves by harboring and transporting smuggled aliens. Juan Carlos Solis-Sanchez, 31, of Mexico, Daniel Sanchez-Cabarello, 31, of El Salvador, and Edgar Carranza-Espinal, 36, and Carlos Benegas-Benetiz, 36, both of Honduras, previously entered guilty pleas to conspiracy to transport aliens. A sixth defendant, Fredis Sanchez-Martinez, 22, of Honduras, was convicted of conspiracy to harbor aliens illegal present in the United States.
Charges in the case stem from an investigation that began in January 2013 after federal agents received information that Chao-Martinez was involved in organizing temporary housing for aliens smuggled to Houston. He then coordinated their transportation by means of motor vehicle to different locations throughout the United States.
In June 2013, Chao-Martinez, Solis-Sanchez and Sanchez-Caballero were arrested in connection with arranging the transportation of 14 aliens illegally present in the United States. Later, agents executed a search warrant at a residence in Houston which was being used by Chao-Martinez and his conspirators to stash aliens awaiting transportation. Agents encountered 10 additional aliens illegally present in the United States. Agents also encountered Sanchez-Martinez, Cararranza-Espinal and Benegas-Benetiz, all of whom were determined to be employees of Chao-Martinez involved in the alien smuggling conspiracy.
U.S. District Judge Sim Lake has set sentencing for Chao-Martinez on Oct. 24, 2013, while the others will be sentenced Oct. 22, 2013. All face up to 10 years imprisonment and a possible $250,000 fine.
The investigation leading to the charges in this case was conducted by Homeland Security Investigations. Assistant United States Attorney Casey N. MacDonald is prosecuting the case.
Six Joplin Family Members Among 21 Indicted for Meth ConspiracyRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Joplin, Mo., couple and their four adult sons are among 21 defendants who have been indicted by a federal grand jury for their roles in a conspiracy to distribute large quantities of methamphetamine in Jasper County, Mo.
Gerardo Hernandez Cazares, Sr., 51, his wife, Leticia Cazares, 51, a citizen of Mexico who is a permanent legal resident of the United States and his four sons, Jose DeLeon Cazares, 28, Gerardo Cazares Jr., 29, Eric Eziquel Cazares, 30, and Abraham Cazares, 24, all of Joplin; Casey Murray, 19, Gilbert Roland, 49, David Roland, 32, Charles Jackson Lee III, 29, James Pickel, 55, Michael Fordyce, 52, Michael Ray Hendrix, 33, Jimmy Don Thompson, 22, Nathan Kent Hernandez, 33, Jorge Ercules, 27, a citizen of Honduras, Henry Gonzalez, 31 and Hugo Rodriguez, 41, both citizens of Mexico, all of Joplin; Daniel Nevarez, 27, (Gerardo Cazares’s son in law), of Carl Junction, Mo.; Gabrielle Sharp, 20, of Springfield, Mo.; and Jose Puente, 41, of Commerce, Okla., were charged in a 34-count indictment returned by a federal grand jury in Springfield on July 24, 2013. The indictment replaced a federal criminal complaint that was filed on June 13, 2013.
According to an affidavit filed in support of the original criminal complaint, law enforcement authorities noticed a significant increase in the availability of methamphetamine in the Joplin area beginning in June 2012. A confidential source stated there was a drug-trafficking organization in Joplin that was importing very pure methamphetamine from Mexico into the United States, then transporting it by automobile to Joplin.
The federal indictment alleges that all 21 defendants participated in a conspiracy to distribute methamphetamine from July 16, 2012, to June 14, 2013.
In addition to the conspiracy, Gerardo Cazares, Sr., Gerardo Cazares, Jr., Jose Cazares, Hendrix, Pickel, Ercules and Gonzalez are variously charged in 22 counts related to distributing methamphetamine.
Gerardo Cazares, Sr., Gerardo Cazares, Jr., Jose Cazares, Eric Cazares, Leticia Cazares, Hendrix, Pickel, Sharp, Thompson, Hernandez, Rodriguez and Lee are also variously charged in 11 counts related to using a telephone to facilitate the drug-trafficking conspiracy.
The federal indictment also contains two forfeiture allegations, which would require Pickel to forfeit to the government $1,600 that was seized by law enforcement officers, and would require Roland to forfeit to the government $4,162 that was seized by law enforcement officers.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Special Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the FBI, IRS-Criminal Investigation, U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), the Bureau of Indian Affairs, the Missouri State Highway Patrol, the Kansas Bureau of Investigation, the Jasper County Drug Task Force, the Joplin, Mo., Police Department and the Miami, Okla., Police Department.Richland County Man Sentenced on Methamphetamine Related ChargesRead the Press Release
A Richland County man was sentenced on August 1, 2013, to federal prison on methamphetamine related charges, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today.
Jeffrey T. Wimberly, 46, of Olney, was sentenced to 108 months in prison, four years supervised release following his imprisonment, and fined $300. Wimberly had previously pleaded guilty to a federal indictment which charged that from February 2011, until on or about October 2012, in Richland County and Edwards County, Wimberly conspired with others to manufacture more than 50 grams of methamphetamine.
The investigations were conducted by the Richland County Sheriff’s Office.
The cases are being handled by Assistant United States Attorney George Norwood.