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18 July 2013
Conspirators Plead Guilty to Selling HIPAA-Protected Patient Information for Tax FraudRead the Press Release
Tampa, FL - Acting United States Attorney A. Lee Bentley, III announces that Denetria Barnes (24) and Jakiel Bazart (28), both of Tampa, today pleaded guilty to conspiracy to defraud the United States and wrongfully disclosing HIPAA information. Both face a maximum penalty of ten years in federal prison.
According to court documents, in August of 2012, the Tampa Police Department recovered stolen means of identification when they executed a narcotics-related search warrant. Those documents were being used to file fraudulent tax returns. The documents ultimately led law enforcement to Barnes and Bazart, who had been selling patients' names, dates of birth, and Social Security numbers.
Working in an undercover capacity, law enforcement purchased a number of HIPAA-protected records from both Bazart and Barnes. With respect to Bazart, this included an incident, on April 3, 2013, where Bazart offered to sell fifteen pages of means of identification for $1,500. Bazart also said that he had a “trash barrel” filled with patients’ means of identification. On May 22, 2013, Barnes attempted to sell a spreadsheet containing approximately 400 stolen means of identification for $15,000. One of the columns on the spreadsheet contained each patient’s home address.
This case was investigated by Internal Revenue Service-Criminal Investigation, the Tampa Police Department, the Hillsborough County Sheriff's Office, and the Florida Department of Law Enforcement. It is being prosecuted by Assistant United States Attorney Thomas N. Palermo.
Cecil County Prescription Drug Dealers Sentenced to PrisonRead the Press Release
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced Matthew Earl Ward, age 33, of Elkton, Maryland, today to 10 years in prison, followed by three years of supervised release, for conspiracy to distribute, and possess with intent to distribute oxycodone and alprazolam. Judge Hollander sentenced James Stevenson, age 47, of Elkton, Maryland, to five years in prison, followed by three years of supervised release for conspiracy to distribute and possess with intent to distribute oxycodone.
The sentences were announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Cecil County Sheriff Barry A. Janney, Sr. and Colonel Marcus L. Brown, Superintendent of the Maryland State Police.
According to the evidence presented at their eight day trial, Matthew Ward and James Stevenson were part of a conspiracy that operated for several years distributing prescription drugs in and around Cecil County, Maryland. Ward primarily obtained the prescription drugs from individuals who went to doctors’ offices, obtained large prescriptions for oxycodone and other pills, and then sold many of the pills they obtained to Ward and other conspirators. Stevenson and others traveled to Florida to obtain prescriptions for oxycodone, which Stevenson then sold in bulk quantities, primarily to Ward or another conspirator.
A witness testified at trial that approximately 15 people provided Ward with pills from their prescriptions. Ward sold the drugs, typically charging $20 per 30mg pill of oxycodone. Although testimony showed that Ward also used some of the drugs he obtained, intercepted telephone communications made clear that Ward’s primary source of income was the sale of prescription drugs.
Several of the individuals who provided pills to the conspiracy obtained prescriptions from multiple doctors. Ward and other conspirators provided some of these individuals with transportation and money for their doctors’ appointments and prescriptions. Ward also provided urine to some of these individuals to ensure that they would pass if a urine test were administered at a doctor’s office. Ward was reimbursed in pills.
In July 2010, the residence where Ward was staying was searched by law enforcement who recovered seven methadone pills, 22 oxycodone pills, and $950 in cash from the room Ward was using. Ward continued distributing prescription pills until his arrest on November 17, 2010. At the time of his arrest, Ward was in possession of 81 15mg tablets and 21 30mg tablets of oxycodone.
Testimony at trial established that Stevenson made trips to Florida in October and November 2010, during which prescription drugs were obtained. Specifically, during each trip, Stevenson and his friend obtained prescriptions for 30mg oxycodone pills from two doctors. Stevenson’s friend sold all of the pills he obtained to Stevenson. Other co-conspirators went along on the trips and also obtained prescriptions for 30mg oxycodone pills, providing the majority of the pills to Stevenson, but keeping some for themselves. Stevenson distributed at least 365 pills to Ward after the October trip to Florida, and obtained several hundred additional 30 mg oxycodone pills on the November trip.
Stevenson falsely testified at trial that he was not involved in selling oxycodone.
In total, the members of the conspiracy distributed several hundred thousand milligrams of oxycodone.
United States Attorney Rod J. Rosenstein commended the DEA, FBI, Cecil County Sheriff’s Office and Maryland State Police for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Joshua Kaul, who prosecuted this Organized Crime Drug Enforcement Task Force case.
Casamero Lake, N.M., Man Pleads Guilty to Assaulting a Person During a Home InvasionRead the Press Release
ALBUQUERQUE – Kirby Cleveland, 29, an enrolled member of the Navajo Nation who resides in Casamero Lake, N.M., pleaded guilty this morning to a federal assault charge. Under the terms of his plea agreement, Cleveland will be sentenced to two-years in prison followed by a term of supervised release to be determined by the court.
Cleveland was arrested in July 2012, based on a criminal complaint and subsequently indicted and charged with assault with a dangerous weapon, assault resulting in serious bodily injury, and aggravated burglary. According to the criminal complaint forcefully entered into a residence located on the Navajo Indian Reservation, armed with a baseball bat and assaulted a Navajo woman.
During this morning’s proceedings, Cleveland pleaded guilty to assault resulting in serious bodily injury and admitted assaulting the victim on May 14, 2012, at her family’s home. According to his plea agreement, Cleveland went to the victim’s home looking for individuals who had threatened him earlier in the day.
Cleveland has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has yet to be scheduled.
This case was investigated by the Crownpoint office of the Navajo Nation Division of Public Safety and is being prosecuted by Assistant U.S. Attorneys Jacob Wishard and Novaline D. Wilson.
California Man Pleads Not Guilty to Child Support ChargeRead the Press Release
United States Attorney Brendan V. Johnson announced that an Anaheim, California, man has been indicted by a federal grand jury for Failure to Pay Legal Child Support.
Richard A. Wade, age 42, was indicted by a federal grand jury on July 6, 2011, for failing to pay over $21,822 in past due child support. He appeared before U.S. Magistrate Judge John E. Simko on July 16, 2013, and pled not guilty to the indictment.
The maximum penalty upon conviction is 2 years' imprisonment, a $250,000 fine, or both; 1 year of supervised release and 1 additional year of supervised release upon revocation; a $100 assessment fee to the Federal Crime Victim’s Fund; and child support restitution amount owing at the time of sentencing.
The charge is merely an accusation and Wade is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Department of Health and Human Services, Office of Inspector General. Assistant U.S. Attorney Thomas J. Wright is prosecuting the case.
Wade was released on bond pending trial. A trial date has been set for September 24, 2013.Buffalo Man on Drug Tracfficking and Firearms ChargesRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Harold Howard, 42, of Buffalo, N.Y., who was convicted after a jury trial of conspiracy to distribute cocaine, possession with intent to distribute cocaine, possession of firearms in furtherance of drug trafficking crimes, possession of firearms and ammunition while being a convicted felon, and unlawful possession of a machine gun, was sentenced to 35 years in prison.
Assistant U.S. Attorneys Melissa M. Marangola and George C. Burgasser, who handled the prosecution of the case, stated that the defendant was arrested following a long term investigation by the Erie County Sheriff's Department. In November 2011, during the execution of a search warrant at 93 Elmer St. in Buffalo, law enforcement officers found three kilograms of cocaine and three loaded firearms in Howard's vehicle.The Government presented evidence at trial that Howard transported cocaine between Atlanta, Georgia and Buffalo between 2008 and November 2011. In November 2008, the defendant was stopped in Atlanta with $104,000 and a loaded firearm. In November 2009, Howard was arrested by Buffalo Police after being stopped with cocaine and a loaded firearm. As a result, the defendant is currently serving a state sentence for possession of a firearm.
The sentencing is the result of an investigation on the part of the Erie County Sheriff's department, under the direction of Sheriff Timothy B. Howard, and the New York State Police, under the direction of Major Michael Cerretto, the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Frank Christiano, and the Drug Enforcement Administration, under the direction of Special Agent in Charge Brian R. Crowell, New York Field Division.
"This case is another example of the continued and successful cooperation between our Office and law enforcement partners at all levels," said U.S. Attorney Hochul. "As the sentence in this case indicates, defendants who fill the streets of our community with illegal narcotics and illegal firearms can potentially spend the rest of their natural lives behind bars."Broward County Resident Sentenced for Importing Marijuana from the BahamasRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement, Homeland Security Investigations (ICE-HSI), announced that Broward resident Jaime Omar Sotomayor was sentenced on Friday, July 12, 2013 to 84 months imprisonment and four years of supervised release by United States District Judge William J. Zloch on charges of importing marijuana from the Bahamas.
Sotomayor was adjudicated guilty of the following offenses: conspiracy to import 100 kilograms or more of marijuana in violation of Title 21, United States Code, Section 963 (count one), importation of 100 kilograms of marijuana in violation of Title 21, United States Code, Section 952(a) (count two), conspiracy to possess with intent to distribute 100 kilograms or more of marijuana in violation of Title 21, United States Code, Section 846 (count three), and possession with intent to distribution 100 kilograms of marijuana in violation of Title 21, United States Code, Section 841(a)(1) (count four).
This case stemmed from an interdiction of marijuana by the Palm Beach Police Department and Department of Homeland Security from a boat that traveled from Bimini, Bahamas to West Palm Beach loaded with 667 pounds of marijuana in the center console and coolers located on the vessel.
Mr. Ferrer commended the investigative efforts of ICE-HSI and the Palm Beach Police Department. The case was prosecuted by Assistant United States Attorney Lothrop Morris.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Brooklyn Owner of Sportswear Distribution Business Pleads Guilty to Tax EvasionRead the Press Release
The Justice Department and Internal Revenue Service (IRS) announced today that Harry Neuhoff, a resident of Brooklyn, N.Y., has pleaded guilty to tax evasion.
According to documents filed with the court, Neuhoff was president and an owner of EVA TEES Inc., formerly of Long Island City, N.Y. and presently located in Piscataway, N.J. From approximately 2006 to 2008, Neuhoff manipulated EVA TEES accounts through an accounting software program to delete cash sales from the general ledger accounts maintained on the computer accounting system. As a result, Neuhoff filed false corporate tax returns on behalf of EVA-TEES with the IRS that underreported the gross receipts of EVA TEES. Neuhoff’s conduct also correspondingly resulted in his filing of false personal income tax returns with the IRS for those years. According to the documents filed with the court, Neuhoff underreported the gross receipts of EVA TEES through computer manipulations by at least $1.5 million. Sentencing is scheduled for Nov. 8, 2013 before U.S. District Court Judge Edward Korman.
Neuhoff faces a maximum sentence of five years in prison, three years of supervised release, a $250,000 fine and a $100 special assessment. He has agreed to pay restitution to the IRS.
The case was investigated by IRS-Criminal Investigation. Trial Attorneys Mark Kotila and Karen E. Kelly of the Justice Department’s Tax Division prosecuted this case.
Bergen County, N.J., Man Sentenced to Five Years in Prison for Downloading Images and Videos of Child Sexual AbuseRead the Press Release
NEWARK, N.J. – A Bergen County, N.J., man was sentenced today to 60 months in prison for knowingly receiving over the Internet images and videos of child sexual abuse, U.S. Attorney Paul J. Fishman announced.
Joseph Anthony Amari, 81, of Fair Lawn, N.J., previously pleaded guilty before U.S. District Judge Katharine S. Hayden to one count of an indictment charging him with receipt of child pornography. Judge Hayden imposed the sentence today in Newark federal court.
Amari, who was initially federally charged by complaint in 2009, is currently serving a sentence in state prison following a separate state conviction for endangering the welfare of two minors. His federal sentence will run concurrently with his state sentence. The state also required Amari to register as a sex offender. The court had stayed the federal prosecution pending the resolution of the state charges.
According to documents filed in this case and statements made in court:
Amari admitted during his guilty plea that he used peer-to-peer file-sharing software to download images and videos in February 2007 of children being sexually abused.
In addition to the prison term, Judge Hayden sentenced Amari to five years of supervised release.
U.S. Attorney Fishman credited the FBI Child Exploitation Task Force in New Jersey, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to today’s sentence. He also thanked the Bergen County Prosecutor’s Office, under the direction of Prosecutor John L. Molinelli, and the Fair Lawn Police Department, under the direction of Chief of Police Erik Rose.
The government is represented by Assistant U.S. Attorneys Jane H. Yoon and Shirley U. Emehelu of the U.S. Attorney’s Office Criminal Division in Newark.
13-296
Defense counsel: Chester Keller Esq., NewarkBelington Resident Enters Plea of Guilty to Manufacturing MethamphetamineRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-7725 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistFollow us on Twitter @NDWVnews
ELKINS, WEST VIRGINIA — United States Attorney William J. Ihlenfeld, II announced that the following individual recently appeared in Federal Court in Elkins.
GARY RUDOLPH LOY entered a plea of guilty to “Manufacturing Methamphetamine” on August 28, 2012. LOY, who is free on bond pending sentencing, faces up to 20 years imprisonment and a $1,000,000 fine.
This case was prosecuted by Assistant United States Attorney Stephen D. Warner and investigated by the West Virginia State Police, the Randolph County Sheriff’s Department and the Belington Police Department.
Beckley Pill Dealer Sentenced to More Than 5 Years in Federal Prison on Oxycodone ChargeRead the Press Release
BECKLEY, W.Va. – A Beckley pill dealer was sentenced today to five years and three months in federal prison for illegally distributing the powerful prescription painkiller oxycodone, announced U.S. Attorney Booth Goodwin. Leondus A. Whittenburg II, also known as “Leondis Wilson,” 31, previously pleaded guilty in March to possession of oxycodone with intent to deliver. On October 24, 2012, Whittenburg sold oxycodone pills to a confidential informant working in cooperation with law enforcement authorities. The illegal pill transaction took place near Beckley.The Beckley Police Department conducted the investigation. Assistant United States Attorney Miller Bushong handled the prosecution. The sentence was imposed by United States District Judge Irene C. Berger.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Aryan Brotherhood of Texas Gang Associate Pleads Guilty to Federal Racketeering ChargesRead the Press Release
An associate of the Aryan Brotherhood of Texas (ABT) gang pleaded guilty today to racketeering charges related to her involvement in the ABT’s criminal enterprise, announced Acting Assistant Attorney Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Samantha Goldman, 29, of Houston, pleaded guilty before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Goldman and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. According to court documents, Goldman held the position of ABT “Hub” and was often referred to as a “Featherwood.” In her capacity with ABT, she facilitated communication of criminal activities among imprisoned gang members regarding gang-related business, collection of dues, commission of disciplinary assaults against fellow gang members and acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Goldman has admitted to being an associate of the ABT criminal enterprise.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and the promotion of white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, arson, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
Judge Lake has set sentencing for Oct. 17, 2013, at which time Goldman faces a maximum penalty of life in prison.Goldman is one of 35 defendants charged with conducting racketeering activity through the ABT criminal enterprise, among other charges. She is the eighth defendant charged in the indictment to plead guilty.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; U.S. Immigration and Customs Enforcement Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County, Texas, Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Tarrant County, Texas, Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Orange County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Carrollton, Texas, Police Department; Mesquite Texas, Police Department; Montgomery County District Attorney’s Office; and Atascosa County District Attorney’s Office.The case is being prosecuted by the Criminal Division’s Organized Crime and Gang Section and the U.S. Attorney’s Office for the Southern District of Texas.
Aryan Brotherhood of Texas Gang Associate Pleads Guilty to Federal Racketeering ChargesRead the Press Release
HOUSTON – An associate of the Aryan Brotherhood of Texas (ABT) gang pleaded guilty today to racketeering charges related to her involvement in the ABT’s criminal enterprise, announced United States Attorney Kenneth Magidson and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.
Samantha Goldman, 29, of Houston, pleaded guilty before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Goldman and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. According to court documents, Goldman held the position of ABT “Hub” and was often referred to as a “Featherwood.” In her capacity with ABT, she facilitated communication of criminal activities among imprisoned gang members regarding gang-related business, collection of dues, commission of disciplinary assaults against fellow gang members and acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Goldman has admitted to being an associate of the ABT criminal enterprise.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and the promotion of white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, arson, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
Judge Lake has set sentencing for Oct. 17, 2013, at which time Goldman faces a maximum penalty of life in prison.Goldman is one of 35 defendants charged with conducting racketeering activity through the ABT criminal enterprise, among other charges. She is the eighth defendant charged in the indictment to plead guilty.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; sheriff’s offices in Harris, Tarrant, Atascosa, Orange and Waller Counties; police departments in Alvin, Carrollton and Mesquite Texas; as well as the Montgomery and Atascosa County District Attorney’s Offices.The case is being prosecuted by the U.S. Attorney’s Office of the Southern District of Texas and the Criminal Division’s Organized Crime and Gang Section.
Affordable Housing Developer Indicted for Alleged Fraud, Diverting Public Funds from Trenton, N.J. ProjectsRead the Press Release
TRENTON, N.J. – A federal grand jury in New Jersey has indicted the developer of three Trenton affordable housing projects for allegedly diverted money intended for the developments, announced New Jersey U.S. Attorney Paul J. Fishman.
A federal grand jury returned a 25-count indictment today charging Robert Kahan, 67, of Sunny Isles Beach, Fla., with 10 counts of making false statement in a loan application, three counts of bank fraud, three counts of mail fraud, two counts of fraud against a local government receiving federal benefits, and seven counts of transacting in criminal proceeds. Kahan will be required to appear in federal court to face the charges on a date to be determined.
“As alleged in the indictment, Kahan took money intended for projects designed to help those in need of affordable housing and used it for his own ends,” said U.S. Attorney Fishman. “It isn’t just defrauded financial institutions and programs that lose: it’s the people of our cities who are the most vulnerable. They can’t afford it, and we won’t stand for it.”
“Mr. Kahan allegedly took advantage of the system and the good faith of banks, credit lenders and the local and federal government by diverting funds procured for the development of affordable housing,” said FBI Special Agent in Charge Aaron T. Ford. “The Newark office of the FBI remains committed to bringing to justice those individuals that insist on misusing funds through fraud and deception. Today’s plea is the result of the hard work of the men and women of the FBI and our federal partners at the Internal Revenue Service and U.S. Department of Housing and Urban Development, Office of Inspector General. Together with our federal partners we will continue combating fraud at all levels of society.”
According to the indictment: Kahan was a developer of three affordable housing projects in Trenton between 2006 and 2010 – the Canal Plaza Homeownership Project, the Southwest Village II Project and the Catherine S. Graham Project – for which he obtained both private and public funding.
When seeking loans for projects, including the three Trenton projects, Kahan caused personal financial statements to be submitted to banks on behalf of himself and his spouse that falsely overstated the value of his assets.
Kahan also falsely represented in payment applications, when requesting advances of loan and subsidy money in connection with the three Trenton projects, that all money he was previously paid had been used to pay costs for labor, materials and other obligations for a particular project. Kahan allegedly caused substantial portions of the money to be diverted for his own personal use, his other development projects and other uses that were not authorized.
The false statement in a loan application, bank fraud and mail fraud counts each carry a maximum potential penalty of 30 years in prison and a $1 million fine. The charges of fraud against a local government receiving federal benefits and transacting in criminal proceeds each carry a maximum potential penalty of 10 years in prison and a $250,000 fine.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Ford; IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; and the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Cary Rubenstein, Special Agent in Charge, Northeast Region, with the investigation leading to the indictment.
The government is represented by Assistant U.S. Attorney Eric Moran in Trenton and Senior Litigation Counsel J Fortier Imbert in Newark, both of the U.S. Attorney’s Office Special Prosecutions Division.
The charges and allegations contained in the Indictment are merely accusations, and the defendant is considered innocent unless and until proven guilty.13-298
Defense counsel: Scott Krasny Esq., West Trenton, N.J.Kahan Indictment
16 Defendants Charged in A Commercial Burglary Ringand Drug ConspiracyRead the Press Release
21 Locations Searched Today Involving Drug Trafficking and Burglaries and
Home Invasion Robberies Committed in Maryland, Virginia, West Virginia and
Pennsylvania,
Baltimore, Maryland – A federal grand jury has returned three indictments charging 16 defendants - eight in a conspiracy to distribute prescription drugs, heroin and cocaine around the Baltimore metropolitan area and the remaining defendants in conspiracies to commit armed home invasions, residential burglaries and commercial burglaries. The indictments were returned on July 16, 2013 and unsealed today upon the arrests of the defendants and execution of search warrants at 21 locations in Baltimore, Baltimore County and Anne Arundel County.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Assistant Special Agent in Charge Gary Tuggle of the Drug Enforcement Administration, Baltimore District Office; Howard County Police Chief William McMahon; Chief James W. Johnson of the Baltimore County Police Department; Anne Arundel County Police Chief Kevin Davis; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Special Agent in Charge Nicholas DiGiulio, Office of Investigations, Office of Inspector General of the Department of Health and Human Services; Otis E. Harris, Jr., Special Agent in Charge, Coast Guard Investigative Service, Chesapeake Region; and Commissioner Anthony W. Batts of the Baltimore Police Department.
“Prescription drug trafficking in the Baltimore area is a growing problem, and today’s law enforcement action is evidence that DEA, along with our federal, state and local partners, intend to aggressively combat this problem,” said Assistant Special Agent in Charge Gary Tuggle, of the Drug Enforcement Administration’s (DEA) Baltimore District Office. “We conducted a very large-scale operation today and due to the diligent work of all involved, this Drug Trafficking Organization (DTO) has been dismantled. We in law enforcement will continue to pursue all investigative leads to put criminals who bring drugs and violence to our neighborhoods in prison where they belong,” added Tuggle.
“This is a group of violent individuals who have victimized citizens and businesses throughout the region for some time,” stated Howard County Police Chief William McMahon. “We are proud to have taken part in this effort, and thankful for the partnerships we have with the local and federal agencies who participated. The success of this investigation is highlighted by the nature and seriousness of the charges levied and the number of defendants arrested.”
"This is another example of the extraordinary work being done by our federal, state, and local partners to reduce crime in Baltimore," said Police Commissioner Anthony Batts. "We are sending a message -if you bring drugs, weapons or violence to Baltimore, every tool available will be used to bring you to justice."
The following defendants are charged in one indictment with conspiring to distribute oxycodone, heroin, methadone, buprenorphine, cocaine and alprazolam from 2010 to the present:
David Paschall, age 54, of Catonsville, Maryland,
Jackie Weatherley, age 30, of Lansdowne, Maryland,
Chad Paschall, age 28, of Baltimore,
Michael Terry, age 51, of Baltimore,
Richard Ashbrook, age 51, of Baltimore,
Richard Braitsch, age 38, of Baltimore,
William Matheny, age 44, of Lansdowne, and
Sidney Tawes, age 24, of Dundalk, Maryland.
The indictment seeks the forfeiture of at least $2 million, four properties and seven vehicles alleged to be used in or proceeds of the drug distribution. These defendants face a maximum sentence of 20 years in prison and a $1 million fine.
The following defendants are charged in a second indictment with conspiring to commit bank larceny and incidental crimes, and interstate transportation of stolen goods from September 2011 to the present. Three of the defendants are also charged with being a felon in unlawful possession of a firearm:
David Paschall,
Chad Paschall,
Mark Johnson, age 51, Baltimore,
Ronald Henderson, age 51, of Pasadena, Maryland,
William Metcalf, age 38, of Baltimore, and
Kenneth Smith, age 51, of Millersville, Maryland.
This indictment seeks forfeiture of at least $500,000, two properties in Catonsville, Maryland and Baltimore, and two vehicles. These defendants face a maximum sentence of five years in prison for the conspiracy. David Paschall, Mark Johnson and Ronald Henderson also face a maximum sentence of 10 years in prison for being a felon in possession of a gun.
The third indictment charges the following defendants with conspiring to commit bank larceny and interstate transportation of stolen goods from September 2011 to the present:
Carl Parrish Paschall, Sr., age 53, of Halethorpe, Maryland;
Carl Parrish Paschall, Jr., age 31, of Baltimore;
Chad Paschall,
Michael Johnson, age 25, of Baltimore, and
Thomas Ellis, age 22, of Baltimore.
This indictment also seeks forfeiture of at least $500,000, the two properties in Catonsville and Baltimore, and five vehicles. These defendants face a maximum sentence of five years in prison.
More specifically, according to an affidavit supporting the search warrants, David Paschall operates Paschall’s Auto Body and Fender located at 801 Desoto Road in Baltimore. This location is central to the drug distribution and other criminal activities allegedly carried out by the defendants. David Paschall’s street level drug connections provide him with quantities of oxycodone and other controlled substances at discount prices. Paschall then allegedly sells the drugs at a higher price for profit, while obtaining doses for himself. Customers allegedly come to the auto shop daily to purchase significant amounts of Oxycodone and other pharmaceuticals and controlled substances from David Paschall. Suppliers also deliver drugs to this location as well.
The affidavit alleges that this criminal enterprise also commits commercial burglaries, home invasion armed robberies, arsons and other crimes at convenience stores, gas stations, financial institutions, restaurants homes and liquor stores in Maryland, Virginia, West Virginia and Pennsylvania. Safes and ATMs are primarily targeted and taken. Lottery tickets and cigarettes are also taken along with other valuables. The modus operandi allegedly includes break-ins during the late night or early morning hours; power lines, telephone lines, cables and other wires cut prior to entry; video cameras disconnected or destroyed; a lookout and/or a driver nearby in a getaway vehicle; and door locks removed. After the initial break-in, they leave the location to wait for any response from police. Sometimes they remain for two or more hours once inside the location. Video recording systems are taken or destroyed. Pry bars, hammers, flashlights, chop saws, grinders, drills, and blow torches are used. ATMs and safes are broken open or taken.
Local law enforcement in Maryland are coordinating with agencies in surrounding jurisdictions and are continuing to connect unresolved burglaries to this organization.
Also arrested today by Baltimore County Police on state charges was Michael Paschall, son of David Paschall, for his alleged participation in a home invasion robbery in Kingsville, Maryland on March 4, 2013, as alleged in the affidavit. The homeowner was pistol whipped and robbed. He was hospitalized following the robbery.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein commended the DEA, Howard County Police Department, Baltimore County Police Department; Anne Arundel County Department, ATF, Department of Health and Human Services - Office of Inspector General; Coast Guard Investigative Service and Baltimore Police Department for their work in the investigation. Mr. Rosenstein also praised the many local and state agencies in Virginia, West Virginia and Pennsylvania for their assistance in the investigation.
Mr. Rosenstein thanked Assistant United States Attorneys David I. Sharfstein and Andrea L. Smith, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
17 July 2013
Youngwood Child Porn Possessor Sentenced to 6 Years, 8 Months in PrisonRead the Press Release
PITTSBURGH - A Westmoreland County resident has been sentenced in federal court to 80 months imprisonment, to be followed by 10 years of supervised release, on his conviction of Possession of Material Depicting the Sexual Exploitation of a Minor, United States Attorney David J. Hickton announced today.
United States District Judge Gustave Diamond imposed the sentence on Joshua J. Gildea, 26, formerly of Youngwood, Pa.
According to information presented to the court, on July 30, 2012, Gildea possessed visual depictions, namely, images and videos in computer graphics files, the production of which involved the use of minors engaging in sexually explicit conduct.
Assistant United States Attorney Jessica Lieber Smolar prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Federal Bureau of Investigation, the Pennsylvania State Police, and the Greensburg Police Department for the investigation leading to the successful prosecution of Gildea.
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.justice.gov/psc.
Wyoming County Man Sentenced to Federal Prison for Theft from an Employee Benefit Plan and Failure to File A Tax ReturnRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a Wyoming County man was sentenced today by Senior United States District Judge James M. Munley to serve 17 months in prison on the charges of Theft from an Employee Benefit Plan and Failure to File an Income Tax Return.
According to United States Attorney Peter J. Smith, Charles Yaskulski, age 43, of Nicholson, Wyoming County, was the former president and majority shareholder of Eagle Warranty Corporation, located in Eynon, Lackawanna County, a business which marketed and sold used car warranty policies to customers in twelve states nationwide. Eagle Warranty also established a profit sharing plan, whereby company employees could make payroll-funded contributions to a company-sponsored 401(k) retirement plan. Yaskulski previously admitted to the theft of approximately $16,000 from the retirement plan in 2008 and 2009. Yaskulski also failed to file employer’s quarterly federal tax returns for Eagle Warranty for each tax quarter in 2009.
In addition to the prison term, Senior Judge Munley also ordered that Yaskulski be supervised by a probation officer for two years following his prison sentence. Yaskulski was also ordered to pay restitution to former employees of Eagle Warranty and to the Internal Revenue Service.
The investigation was conducted by the Department of Labor’s Office of Inspector General, the Department of Labor’s Employee Benefit Security Administration and the Internal Revenue Service, Criminal Investigations.
The case was prosecuted by Assistant United States Attorney Robert J. O’Hara.
****Williamsport Resident Sentenced to 70 Months on Federal Tax ChargesRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Cheryl Cobia, age 27, of Williamsport, Pennsylvania was sentenced to 70 months’ imprisonment by U.S. District Court Judge Matthew W. Brann on July 9, 2013, in U.S. District Court in Williamsport.
Cobia pleaded guilty earlier this year to charges of conspiracy and false statements in connection with a scheme to file false federal income tax returns in 2009-2011. Cobia was also charged with making false statements in applications for food stamps and medical assistance benefits.
Cobia and a co-conspirator used computers to create and file false tax returns seeking refunds totaling more than $1 million.
The investigation was conducted by the Internal Revenue Service, Criminal Investigation Division, the Federal Bureau of Investigation and the Office of Inspector General Department of Health and Human Services. Assistant United States Attorney Wayne P. Samuelson prosecuted the case.
* * * *Vernon Parish Man Pleads Guilty to Downloading Child PornographyRead the Press Release
LAFAYETTE, La. – U.S. Attorney Stephanie A. Finley announced today that Francis M. Buckner Jr., 41, of New Llano, La., pleaded guilty before U.S. District Judge Richard T. Haik to possession of child pornography.
According to evidence presented at the guilty plea, Buckner admitted to possessing 36 videos and 144 images of child pornography. Law enforcement officers identified the defendant as a collector of child pornography involving young children. He used Limewire, a software sharing program, to download the child pornography. A search warrant was obtained for his residence, and the investigation revealed that Buckner had downloaded sadistic material depicting bondage and other sexually explicit scenes involving prepubescent children onto his computer. The defendant admitted he had been downloading child pornography at the time of his arrest.
Buckner faces up to 10 years in prison, a $250,000 fine, and five years of supervised release. A sentencing date has not been set. The Department of Homeland Security Investigations and the Louisiana State Police conducted the investigation. Assistant U.S. Attorney John Luke Walker is prosecuting the case.This case is part of Project Safe Childhood, a U.S. Department of Justice nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The U.S. Attorney’s Office and the U.S. Department of Homeland Security/Homeland Security Investigations/Immigration & Customs Enforcement (ICE) encourages the public to report suspected child predators and any suspicious activity through its toll-free hotline at (866) DHS-2ICE. Investigators are available at all hours to answer hotline calls. Tips or other information can also be submitted to ICE online at www.ice.gov/exec/forms/hsi-tips/tips.asp. Tips may be reported anonymously.
United States Army Captain Indicted for Wire and Mail FraudRead the Press Release
GAINESVILLE, FLORIDA – Michael Benjamin Crowder, 35, appeared in the Gainesville Division of the United States District Court for the Northern District of Florida on an indictment charging him with multiple counts of wire and mail fraud, according to Pamela C. Marsh, United States Attorney for the Northern District of Florida.
Crowder, a U.S. Army Captain Judge Advocate General, currently stationed in Ft. Sill, Oklahoma, owned and operated M & H Coins and Precious Metals, LLC from his Gainesville home while attending the University of Florida Levin College of Law under the Army's Funded
Legal Education Program. The indictment alleges that Crowder defrauded customers of more than $700,000 by offering to sell rare coins and precious metals, receiving payment from the customers, and then not delivering the items. No money has been recovered.Crowder is facing a maximum sentence of 20 years imprisonment, a $250,000 fine, three years of supervised release upon completion of his sentence, and a $100 Special Monetary Assessment. He is scheduled for trial on August 20, 2013, at 8:30 am before United States District Judge Mark E. Walker.
The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Greg McMahon.
An indictment is merely an allegation by a grand jury that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial in a court of law.
U.S. Postal Service Employee Sentenced to 46 Months in Prison for Mailing and Receiving Packages of CocaineRead the Press Release
Husband Who Was Charged With Her Sentenced Last Month
NEWARK, N.J. – A former U.S. Postal Service employee was sentenced today to 46 months in prison for her role in a scheme to intercept cocaine-laden packages mailed from Puerto Rico to New Jersey, U.S. Attorney Paul J. Fishman announced.
Christina Nunez, 30, of Lyndhurst, N.J., previously pleaded guilty before U.S. District Judge Esther Salas to an information charging her with one count of conspiracy to possess with intent to distribute and distribution of 500 grams or more of cocaine and one count of mail theft. Judge Salas imposed the sentence today in Newark federal court.Last month, her husband, Luis A. Vega, 37, was sentenced to 37 months in prison for his role in distributing the cocaine-laden packages. Vega previously pleaded guilty before Judge Salas to an information charging him with conspiracy to possess with intent to distribute and distribution of 500 grams or more of cocaine.
According to documents filed in this case and statements made in court:
Since December 2010, Nunez had been receiving packages of cocaine, which were mailed from Puerto Rico to delivery addresses along her mail route. Nunez intercepted the packages, scanned them as delivered despite never delivering the packages to their actual delivery addresses, and ultimately transported them to conspirators in Camden, N.J.
Law enforcement seized approximately two kilograms of cocaine during the investigation. On Feb. 1, 2011, inspectors with the U.S. Postal Inspection Service lawfully seized approximately 1,300 grams of cocaine from an express mail package that was supposed to be delivered by Nunez. After this seizure, the drug trafficking organization ceased sending packages until December 2011, when, once again, packages sent from Puerto Rico were mailed to addresses assigned to Nunez’s mail route.
Another suspicious package was sent from Dorado, Puerto Rico, on August 22, 2012. Once the package arrived in Kearny, N.J., law enforcement noted that the delivery address on the package would be assigned to Nunez’s mail route. Subsequent laboratory analysis confirmed that the package contained approximately 500 grams of cocaine. The cocaine was seized and replaced with a substance similar in appearance to the contents of the package. The package was placed back into circulation for delivery. On August 24, 2012, Nunez failed to deliver the package to its delivery address. At the end of her shift, Nunez returned to her residence in Lyndhurst, N.J., with the package, where she and Vega were arrested.
In addition to intercepting the cocaine-filled packages on her mail route, both Nunez and Vega received packages of narcotics at her residence in Lyndhurst and Vega’s former residence in Jersey City, N.J. In total, it is estimated that Nunez, Vega and their conspirators distributed more than 18 kilograms of cocaine between October 2010 and August 24, 2012.In addition to the prison term, Judge Salas sentenced Nunez to two years of supervised release. Judge Salas also imposed a two-year period of supervised release on Vega.
U.S. Attorney Fishman credited inspectors with the U.S. Postal Inspection Service, under the direction of Postal Inspector in Charge Maria L. Kelokates; special agents of the Office of Inspector General for the U.S. Postal Service, under the direction of Special Agent in Charge Rafael Medina; and special agents with the Drug Enforcement Administration, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation leading to today’s sentence.The Government is represented by Assistant U.S. Attorney Mary E. Toscano of the U.S. Attorney’s Criminal Division in Newark.
13-293Defense counsel: Nunez: Charles Alvarez Esq., Jersey City
Vega: Paul Casteleiro Esq., Hoboken, N.J.Two Men Plead Guilty to Unlawful Taking of Migratory Birds and Lacey Act ViolationsRead the Press Release
United States Attorney Brendan V. Johnson announced that Aaron Eich, age 29, of Sioux Falls, South Dakota, and Chris Paclik, age 21, of Brookings, South Dakota, both appeared before U.S. Magistrate Judge John E. Simko on July 15, 2013, and pled guilty to the Unlawful Taking of Migratory Birds and Lacey Act Violations. They were charged by Information and Eich pled guilty to Count V of the Information that charged him and Paclik pled guilty to Count IV.
For both men, the maximum penalty upon conviction is 1 year of imprisonment, a $100,000 fine, or both; 1 year of supervised release and an additional year of supervised release upon revocation; and a $25 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges stem from an incident wherein Eich and Paclik, along with a group of friends known as “Team Those Guys” hunted between November 24, 2012, and November 29, 2012, in Miner County, South Dakota. Eich illegally killed 65 geese and Paclik illegally killed 54 geese, both using an electronic device. Eich and Paclik admitted they knew it was illegal to use said device while goose hunting during this time of the year. After killing the geese, Eich, Paclik and others transported the dead geese from the field to various locations, in violation of federal law.
The investigation was conducted by the U.S. Fish & Wildlife Service. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the cases.
Both were released on bond pending sentencing. Eich is scheduled to be sentenced on September 5, 2013, and Paclik’s sentencing date is set for August 19, 2013.Two Defendants in Sommet Case Plead GuiltyRead the Press Release
NASHVILLE, Tenn. July 17, 2013 Marsha Whitfield, 39, and D. Edwin Todd, 68, both of Franklin, Tennessee, pleaded guilty today in U.S. District Court, to charges related to their roles in a multi-million-dollar fraud perpetrated by the Sommet Group, LLC, announced David Rivera, Acting U.S. Attorney for the Middle District of Tennessee. Sommet was a payroll-processing company and former sponsor of the Nashville arena once known as the Sommet Center.
Whitfield entered into a plea agreement, through which she pleaded guilty to one count of wire fraud and one count of conspiracy to commit wire fraud, theft or embezzlement from an employee benefit plan, money laundering, and tax fraud. Todd entered a guilty plea to one count of conspiracy, the sole count of the indictment in which he was charged.
As outlined in Marsha Whitfield’s plea agreement, Todd was a co-owner of Sommet, and Marsha Whitfield was vice president of Sommet’s payroll department. Sommet purported to be a payroll-processing company. For a fee, business clients provided Sommet their gross payroll and Sommet promised to allocate and distribute the funds in the appropriate amounts to state and federal taxing authorities, a health‑insurance plan, 401(k) plans, and client employees’ paychecks.
Marsha Whitfiled admitted in her plea agreement, that instead of distributing those client funds in appropriate amounts at appropriate times, she and Todd diverted those funds to personal use, among other things. As a result, clients’ employees’ 401(k) funds were not fully deposited into their 401(k) accounts, their medical and prescription-drug claims were not fully paid by health insurance, and their taxes were not fully or timely paid to the IRS. Marsha Whitfield also admitted that she gave clients false excuses and misleading explanations when they inquired or complained that Sommet had failed to pay obligations such as payroll, health insurance, 401(k) accounts and other financial obligations.
Whitfield and Todd each face up to 5 years in prison and a $250,000 fine on the conspiracy charge. Whitfield faces up to an additional 20 years in prison and a fine of $250,000 on the count of wire fraud.
The remaining defendant, L. Brian Whitfield, is scheduled for trial on January 21, 2014, in U.S. District Court in Nashville. He is presumed innocent unless and until proven guilty.
The case was investigated by agents with the IRS-Criminal Investigation, the FBI and the Department of Labor-Employee Benefits Security Administration. The United States is represented by Assistant United States Attorney Kathryn Ward.Topeka Man Pleads Guilty to Commercial RobberiesRead the Press Release
TOPEKA, KAN. – A Topeka man has pleaded guilty to two commercial robberies, U.S. Attorney Barry Grissom said today.
Brendon R. Thompson, 26, Topeka, Kan., pleaded guilty to two counts of robbery. On Nov. 16, 2012, he robbed the EZ Payday Advance store at 2613 S.W. 21st Street in Topeka. On Jan. 17, 2013, he robbed the Family Dollar at 1313 S.W. 21st Street in Topeka.
Sentencing is set for Nov. 5. He faces a maximum penalty of 20 years in federal prison and a fine up to $250,000 on each count. Grissom commended the Topeka Police Department, the FBI and Assistant U.S. Attorney Jared Maag for their work on the case.
Three Doctors Admit Accepting Bribes for Test Referrals to New Jersey Clinical LaboratoryRead the Press Release
NEWARK, N.J. – Three New Jersey doctors admitted today they accepted tens of thousands of dollars in bribes from Parsippany, N.J.-based Biodiagnostic Laboratory Services LLC (BLS) as part of a long-running scheme operated by the lab, its president, and numerous associates, U.S. Attorney Paul J. Fishman announced.
Dennis Aponte, 46, of Cedar Grove, N.J.; Claudio Dicovsky, 51, of Fort Lee, N.J.; and Franklin Dana Fortunato, 63, of Montville, N.J., each pleaded guilty to violating the Federal Travel Act. Fortunato also pleaded guilty to filing a false tax return, admitting that from 2004 to 2008, he failed to disclose and report as income more than $640,000 in bribe money and patient co-pays and failed to pay more than $160,000 in taxes he owed as a result of that unreported income. The defendants entered their guilty pleas today before U.S. District Judge Stanley R. Chesler in Newark federal court.
“Decisions about medical care should not be influenced by doctors and providers who are more interested in lining their pockets than in providing quality healthcare,” U.S. Attorney Fishman said. “The doctors who pleaded guilty today admitted making decisions about the care they provided based on being paid in return for their referrals. We will continue to seek out and punish those doctors and other medical professionals who put profit before patient care.”
Newark FBI Special Agent in Charge Aaron T. Ford said: “Patients have every right to insist that their physician is making medical referrals based on what is best for the patient. However, these three physicians decided to accept bribes in exchange for referrals. These types of kickback arrangements cripple the healthcare industry and severely impact patient care. The FBI remains committed to investing its resources to combat these types of schemes.”
“Today’s pleas should send a loud and clear message that kickbacks and unnecessary billing have no place in our Federal healthcare system,” Thomas O’Donnell, Special Agent in Charge of the Office of Inspector General of the U.S. Department of Health and Human Region covering New Jersey, said. “We will aggressively investigate those suspected of defrauding taxpayers and the Medicare program.”
According to documents filed in this and other cases and statements made in court:On April 9, 2013, federal agents arrested BLS president and part owner, David Nicoll, 39, of Mountain Lakes, N.J.; Scott Nicoll, 32, of Wayne, N.J., a senior BLS employee and David Nicoll’s brother; and Craig Nordman, 34, of Whippany, N.J., a BLS employee and the CEO of Advantech Sales LLC – an entity used by BLS to make illegal payments. They were charged by federal complaint with the bribery conspiracy, along with the BLS company and New Jersey physician Frank Santangelo, 43, of Boonton, N.J. The charges against BLS and Santangelo are pending.
Dicovsky
Dicovsky admitted he agreed with David Nicoll to accept bribes from BLS in exchange for his referral of blood specimens. To disguise those bribes, Dicovsky and BLS entered into a sham lease agreement and a sham service agreement in which the monthly bribe payments of more than $5,000 were characterized as “lease” and “service” payments. While the lease agreement purported to be for 1,000 square feet of space, little or no space was allocated to BLS in Dicovsky’s medical office in Paterson, N.J. Between November 2006 and August 2009, Dicovsky received more than $224,000 in bribe payments from BLS, and BLS made more than $800,000 through testing on blood specimens referred by Dicovsky.
Fortunato
On May 2, 2013, two former sales representatives of BLS, Peter Breihof, 42, of Nutley, N.J., and William Dailey, 41, of Wall, N.J., pleaded guilty to an information charging them with conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act. They admitted using phony lease and service agreements to bribe physicians to send their patients’ blood samples to BLS. Breihof and Dailey also admitted that individuals acting on behalf of BLS paid various physicians a fee per test on behalf of BLS in order to induce those physicians to order more of the blood tests than they otherwise would have.
Fortunato admitted entering into bribe arrangements with BLS through Breihof, with David Nicoll’s knowledge and approval, for the referral of blood specimens of patients of Fortunato’s Montclair, N.J., practice. Fortunato received more than $100,000 in bribe payments – often more than $5,000 per month – from BLS disguised through sham lease and sham service agreements between 2006 and 2009, and BLS made more than $430,000 through testing on blood specimens referred by Fortunato.
Aponte
Aponte admitted that he and David Nicoll agreed that BLS would pay Aponte bribes to refer to BLS blood specimens from the patients of his West New York, N.J., medical practice. From October 2012 to March 2013, Nordman, acting at David Nicoll’s direction, paid Aponte approximately $3,000 per month in cash in return for blood specimens referred to BLS. The lab made more than $175,000 through testing on blood specimens referred by Aponte.
The count to which Aponte, Dicovsky and Fortunato each pleaded guilty is punishable by a maximum potential penalty of five years in prison and a $250,000 fine. Fortunato also faces a maximum potential penalty of five years in prison and a $250,000 fine on the filing a false tax return charge. Sentencing for all three defendants is scheduled for Oct. 22, 2013.
Aponte has agreed to forfeit $235,000, Dicovsky has agreed to forfeit more than $220,000, and Fortunato has agreed to forfeit more than $635,000. The investigation has so far recovered more than $2 million through forfeiture.
On June 10, 2013, David Nicoll, Scott Nicoll, Nordman, and four other associates of BLS pleaded guilty to informations charging them with one count of conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act and one count of money laundering. The charges and allegations against Santangelo and BLS are merely accusations, and the defendants are considered innocent unless and until proven guilty.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Ford; U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge O’Donnell; IRS–Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, and the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the ongoing investigation leading to today’s guilty pleas.
The government is represented by Senior Litigation Counsel Andrew Leven, Assistant U.S. Attorney Joseph Minish, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
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Defense counsel: Aponte: John Vazquez Esq. & Michael Critchley Esq., Roseland, N.J.
Dicovsky: Gerald Miller Esq., Jersey City, N.J.
Fortunato: Ricardo Solano Esq., Newark, N.J.Aponte Information
Dicovsky Information
Fortunato InformationThree Defendants Charged with Federal Crimes in Sex Trafficking of A Child InvestigationRead the Press Release
Defendants Face Imprisonment terms of 10 years to Life
BINGHAMTON, NEW YORK - United States Attorney Richard S. Hartunian announced that Lynette Tilden, Edward Tilden, and Alexandria Samson Davall, all from Utica, New York, were arrested by the FBI and charged by a federal felony complaint with three federal offenses in connection to a joint federal and state investigation concerning a prostitution ring engaged in the sex trafficking of a minor. Defendants appeared in federal court in Syracuse, New York on July 16, 2013 and were remanded to the custody of the U.S. Marshal’s Service pending further proceedings.
The federal charges stem from an investigation conducted by the FBI-Albany Division, New York State Police, Oneida County District Attorney’s Office, Utica Police Department, and the Oneida County Child Advocacy Center. The investigation concerned a prostitution ring involved in selling a minor to engage in sexual conduct in exchange for money and drugs. The prostitution ring utilized the website backpage.com to advertise the prostitution. The ring also utilized a texting network to advertise their prostitution business. In addition to the three defendants named above and being charged with federal crimes, the Oneida County District Attorney has charged several other defendants with state crimes in connection to this overall joint investigation. The investigation is continuing.
Defendants Lynette Tilden, Edward Tilden, and Alexandria Samson Davall have been charged with the following three federal offenses and face the following possible penalties if convicted:
1)[Sex Trafficking Of A Child]
In and about February of 2012, in the Northern District of New York and elsewhere, defendants Lynette Tilden, Edward Tilden, Alexandria Samson Davall, and others, while aiding and abetting each other, while in and affecting interstate commerce, did knowingly recruit, entice, harbor, transport, provide, obtain and maintain by any means a person, or benefit, financially or by receiving anything of value, from participation in a venture which engaged in any such act, where the person had not attained the age of 18 years at the time, knowing that the person would be caused to engage in a commercial sex act.
In violation of Title 18, United States Code, Sections 1591(a) & (b) and Section 2. Potential Penalties: Statutory Mandatory Minimum 10 years prison and a Maximum of Life. Maximum possible Fine of $250,000.
2)[Persuading And Inducing A Child To Engage In Prostitution]
In and about February of 2012, in the Northern District of New York and elsewhere, defendants Lynette Tilden, Edward Tilden, Alexandria Samson Davall, and others, while aiding and abetting each other, while using any facility or means of interstate commerce, did knowingly persuade, induce, entice, and coerce an individual who had not attained the age of 18 years to engage in prostitution.
In violation of Title 18, United States Code, Section 2422(b) and Section 2.
Potential Penalties: Statutory Mandatory Minimum 10 years prison and a Maximum of Life. Maximum possible Fine of $250,000.
3)(Distribution Of Heroin And Cocaine To A Minor)
In and about February of 2012, in the Northern District of New York and elsewhere, defendants Lynette Tilden, Edward Tilden, and Alexandria Samson Davall, while aiding and abetting each other and who were at least 18 years of age at the time, knowingly and intentionally distributed a controlled substance to a person under 21 years of age, and more specifically a person who was 16 years of age at the time, in violation of Title 21, United States Code, Section 841(a)(1) and Title 18, United States Code, Section 2. That violation involved heroin and cocaine, Schedule I and II controlled substances, respectfully, in violation of Title 21, United States Code, Section 859(a).
Potential Penalties: Statutory Mandatory Minimum 1 year prison and a Maximum of 40 years. Maximum possible Fine of $1,000,000.
Defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in court.
Syracuse, New York - Upstate Laboratories, Inc., pled guilty to one count of felony mail fraud related to the falsification of over 3,300 laboratory results from 2008 through 2010.Read the Press Release
SYRACUSE, NEW YORK - United States Attorney Richard S. Hartunian announced today that Upstate Laboratories, Inc., 6034 Corporate Drive, East Syracuse, New York pled guilty before Judge Glenn T. Suddaby to one count of felony mail fraud related to the falsification of over 3,300 laboratory results from 2008 through 2010.
As set forth in the plea agreement and charge, Upstate Laboratories has been a certified laboratory in the business of performing chemical analysis of water and soil samples supplied by public and private clients. Samples for which chemical degradation was an issue required Upstate Laboratories to perform analysis within specified time-frames (“holding times”) after the samples were obtained. Upstate Laboratories further promised to utilize required procedures to ensure that the samples did not degrade.
For samples that required a prompt turnaround time, Upstate Laboratories charged a fee greater than for samples that did not. For all samples, Upstate Laboratories represented to clients that analysis would be and was performed in accordance with required analysis standards. Upstate Laboratories submitted invoices for its analysis and was paid through use of the United States mail.
Notwithstanding representations of proper and timely sample analysis, from 2008 through 2010 Upstate Laboratories engaged in the routine “backdating” of samples results where employees changed the dates when the samples were analyzed to make it appear that analysis had occurred within the required time periods when in fact they had not. Upstate Laboratories thereafter prepared false and fraudulent analysis reports representing that samples were properly analyzed within required time frames and that the results were valid when they were not. During the course of the scheme to defraud, Upstate Laboratories falsified results and mailed fraudulent results to clients including the following:
CLIENT NAME
1. Village of Moravia, NY
1. Two Guys From Italy Pizza Restaurant, West Monroe, NY
2. Town of Camillus, NY
3. Steuben County, NY – Division of Solid Waste
4. Oswego County, NY – Department of Health
5. Oswego County, NY – Department of Solid Waste
6. Cortland County, NY – Soil and Water Conservation District
7. Liquid Products, LLC, Waterloo, NY
8. Hanson Aggregates New York, LLC, Poland, NY
9. Casella Waste Systems via On-Site Technical Services, Wellsville, NY
10. A & P Water Testing, Morrisville, NY
11. Wolcott Landfill, Wolcott, NY
12. New York State Department of Transportation – Region 7
13. Hannibal Hills Trailer Park, Hannibal, NY
14. Ontario County, NY - Recycling and Landfill Management
15. Fulton County, NY - Department of Solid Waste
16. Barton and Loguidice, Liverpool, NY
17. Oswego Heat Treating, Inc – Oswego, NY
18. Town of Oswego, Oswego, NY
19. Agro-Farm, Inc, Norwich, NY
20. Tri-Boro Municipal Authority, Susquehanna, PA
21. Village of Endicott, NY – Waste Water Treatment Plant
22. Sullivan County, NY – Department of Public Works
23. Fagan Engineers via Franklin County, NY
24. Applied Testing and Geosciences, Bridgeport, PA
25. City of Tonawanda, NY
26. Oneida – Herkimer Solid Waste Authority, Utica, NY
27. Town of Lumberland, NY
28. Madison County, NY – Department of Solid Waste
29. Kerry Bio-Science, Rochester, MN
30. Ameresco, Inc, Various locations throughout United StatesUpstate Laboratories has agreed to pay to the United States a criminal fine of $150,000, but that from this total, the amount up to the entire fine shall be suspended on the condition that it be paid at the date of imposition of sentence to victims identified in this plea agreement or identified by the Court as entitled to restitution. Nothing about the possible suspension of the criminal fine sets a maximum amount of restitution that must be paid. Rather, Upstate Laboratories must pay all restitution to victims as determined by the Court, even if the amount exceeds $150,000.
Also pursuant to the plea, Upstate Laboratories will be placed on a term of probation for five years. As part of its probation, Upstate Laboratories will be required to develop, fund and implement a comprehensive Environmental Compliance Plan ("ECP") to prevent future violations. Finally, Upstate Laboratories is not permitted to seek or take a tax deduction for any monies paid as a fine.
Sentencing has been set for December 4, 2013.
This case was investigated by Special Agents of the Environmental Protection Agency, Office of Inspector General and Criminal Investigation Divisions. The case is being prosecuted by Assistant United States Attorney Craig Benedict. Questions may be directed to AUSA Benedict at 315-448-0726 or cell phone 315-391-1110.
Steinauer Woman Charged with Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that on July 16, 2013, an indictment was unsealed charging Angie Ray Shera, age 38 of Steinauer, with conspiracy to distribute and possess with the intent to distribute 500 grams or more of a mixture or substance containing methamphetamine between January of 2011 and February of 2013.
The possible penalty is not less than 10 years and up to life in prison and a fine of up to $10,000,000. Following any prison term, there would be a term of supervised release of not less than five years.
Shera appeared in federal court in Lincoln on July 17, 2013, and was ordered held without bond. Trial is scheduled to begin on September 10, 2013.
The matter was investigated by the Lincoln/Lancaster County Narcotics Task Force, which includes officers of the Lincoln Police Department, the Lancaster County Sheriff's Department, the Federal Bureau of Investigation, (FBI), and the University of Nebraska-Lincoln Police Department, and by the Nebraska State Patrol.Six Defendants Plead Guilty in Auto Accident Insurance Fraud SchemeRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced that six defendants pleaded guilty before U.S. District Judge S. Maurice Hicks Jr. on Monday, the day trial was set to begin. The following defendants pleaded guilty to fraud charges related to an automobile accident insurance fraud scheme:
Bobby Lee Kimble, 42, of Athens, La., pleaded guilty to conspiracy, wire fraud, and health care fraud;
Joe Abbott, 54, of Arcadia, La., pleaded guilty to conspiracy, mail fraud, and health care fraud;
Marcus Kimble, 30, of Arcadia, La., pleaded guilty to conspiracy, wire fraud, and health care fraud;
Damario Henderson, 29, of Homer, La., pleaded guilty to conspiracy and health care fraud;
Monica Jenkins, 25, of Athens, La., pleaded guilty to conspiracy, mail fraud, and health care fraud; and
Larry Kimble, 33, of Athens, La., pleaded guilty to conspiracy and wire fraud.
The members of the ring conspired to stage and fabricate automobile accidents and submit fraudulent claims to insurance companies for bodily injury and property damage. The “Kimble Ring,” which was composed of family, friends and associates, staged accidents including two automobile rear-end collisions, single automobile collisions with trees, and false hit and run claims. False claims were filed for accidents in Bienville Parish; Ruston, La.; Athens, La.; and Claiborne Parish between December 2007 and March 2008.
The group faces up to five years in prison and three years of supervised release for conspiracy to commit fraud. They face 10 years in prison and three years of supervised release for health care fraud, up to 20 years in prison and three years supervised release for wire fraud, and up to 20 years in prison and two years supervised release for mail fraud. The charges also each carry a $250,000 fine and restitution. Sentencing dates of November 13 and 14 of 2013 were set for the defendants.
“This group was motivated by greed and their goal was to get as much money as possible by defrauding insurance companies out of thousands of dollars,” Finley stated. “Their actions placed unnecessary burdens on the local insurance system by causing money and time to be misspent on false claims. This office will continue to prosecute these types of cases to the fullest extent of the law.”
The Louisiana State Police investigated the case. Assistant U.S. Attorney Earl M. Campbell prosecuted the case.Sioux Falls Man Pleads Guilty and Is Sentenced for Unlawful Taking of Migratory Birds and Lacey Act ViolationsRead the Press Release
United States Attorney Brendan V. Johnson announced that Travis Vacek, age 34, of Sioux Falls, South Dakota, has pled guilty to Count II of the Amended Information that charged him with Unlawful Taking of Migratory Birds and Lacey Act Violations.
Vacek was sentenced on July 15, 2013, by U.S. Magistrate Judge John E. Simko to 1 year probation, $1,350 in restitution, a $200 fine, and a $25 special assessment to the Federal Crime Victims Fund. Vacek’s hunting privileges were also revoked for 1 year.
The charges stem from an incident wherein Vacek, along with a group of friends known as “Team Those Guys” hunted on November 24, 2012, in Miner County, South Dakota. Vacek illegally killed 18 geese using an electronic device. Vacek admitted he knew it was illegal to use said device while goose hunting during this time of the year. After killing the geese, they were transported from the field to various locations, in violation of federal law.
The investigation was conducted by the U.S. Fish & Wildlife Service. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.Real Estate Developer Sergio Benitez Sentenced to 22 Months’ Imprisonment for Defrauding NYC Department of Housing Preservation & DevelopmentRead the Press Release
Earlier today, Sergio Benitez, a developer of affordable housing projects in Brooklyn for the New York City Department of Housing Preservation and Development (HPD), was sentenced to a term of imprisonment of 22 months followed by three years of supervised release, including a three-year ban from applying for any other city or governmental housing contracts, based on his conviction for wire fraud conspiracy. He was also ordered to pay $228,200 in restitution to the City of New York and fined $10,000. Benitez previously paid an additional $228,200 in forfeiture to the government. The sentencing proceeding was held before United States District Judge Nina Gershon at the U.S. Courthouse in Brooklyn, New York.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Daniel R. Petrole, Deputy Inspector General, United States Department of Labor (DOL) Office of Inspector General; and Rose Gill Hearn, Commissioner, New York City Department of Investigation (DOI).
Benitez was arrested on October 6, 2011, as part of a seven-defendant case involving corruption at HPD and ultimately pleaded guilty to wire fraud conspiracy. According to the government’s filings and other public records, Benitez was a major real estate developer of affordable housing projects sponsored by HPD. Benitez defrauded HPD by demanding kickbacks from a construction contractor in return for hiring him as the general contractor on the Cooper Decatur Cluster affordable housing development in Brooklyn. From 2006 until Benitez’s arrest, the contractor paid two percent of the funds he received from HPD to Benitez, for a total of $228,200 in kickbacks. In order to cover the cost of these kickbacks, the contractor inflated his invoices to HPD by a similar amount. To disguise the kickbacks, Benitez issued sham invoices to the contractor from one of Benitez’s several companies, All Boro Painting & Repairs, Inc. In the meantime, Benitez was featured as a model real estate developer in the New Housing Marketplace Plan issued by HPD in early 2011, where he was quoted as saying, “I’m originally from Brooklyn, and I see my work as a way of giving back.”
“Sergio Benitez claimed that he was ‘giving back’ to Brooklyn, but in reality, all he gave the people of the City of New York was a hefty bill for his own corruption. In taking hundreds of thousands of dollars in kickbacks, Benitez stole from the very community he had pledged to serve, by diverting funds meant for affordable housing construction into his own pockets,” stated United States Attorney Lynch. “Today’s sentence shows that even the most influential real estate developers will be brought to justice if they steal public funds for corrupt personal gain.”
FBI Assistant Director-in-Charge Venizelos stated, “While Sergio Benitez publicly touted his community-minded commitment to Brooklyn, he was privately taking kickbacks whose cost was passed on to the city. Actions speak louder than words, and his actions were self-serving and deceitful.”
DOI Commissioner Gill Hearn stated, “This developer hurt low-income New Yorkers, fleeced the taxpayers, and is going to prison for milking the City’s affordable housing program for kickbacks. His undoing in this joint investigation should warn off anyone tempted to tack the cost of corruption onto the City’s bill.”
United States Attorney Lynch thanked the Internal Revenue Service, Criminal Investigation, New York; the United States Department of Housing and Urban Development; and the New York City Police Department for their cooperation in this case.
To date nine defendants, including HPD’s former Assistant Commissioner, two other supervisory officials at HPD, and six real estate developers and general contractors have pleaded guilty to charges including racketeering conspiracy, bribery and wire fraud conspiracy in connection with the government’s ongoing investigation of widespread corruption of the affordable housing industry. Benitez is the third defendant to have been sentenced.
The government’s case is being prosecuted by Assistant United States Attorneys Cristina M. Posa, Anthony Capozzolo and Claire Kedeshian.
The Defendant
SERGIO BENITEZ
Colts Neck, New Jersey
Age: 53Pittsburgh Man Sentenced for Transporting Stolen Goods from Pennsylvania to TexasRead the Press Release
PITTSBURGH - A Pittsburgh resident has been sentenced in federal court to 24 months imprisonment, a $15,000 fine, and two years supervised release on his conviction of interstate transportation of stolen goods, United States Attorney David J. Hickton announced today.
United States District Judge Arthur J. Schwab imposed the sentence on David Michael Spaid, 56.
According to the information presented to the court, Spaid unlawfully transported, transmitted and transferred and caused to be transported, transmitted and transferred in interstate commerce goods that were stolen, with a value of $5,000 or more, knowing the same to have been taken by fraud.
On or about Oct. 14, 2011, two employees of the Allegheny Ludlum plant in Harrison Township, Kenneth Hill and Timothy Angely, stole four "super sacks" of nickel that had been shipped to Allegheny Ludlum from Russia via Baltimore, Md. The nickel weighed in excess of 17,000 lbs. and had a value of approximately $151,000. Hill and Angely transported the stolen nickel to a nearby open field where it was picked up by a driver working for David Michael Spaid at AAA Scrap Metal, located in Pittsburgh. Spaid negotiated the purchase of the stolen nickel from PJ Eberhardt, who worked in conjunction with Hill and Angely. Spaid would "front" Eberhardt with $30,000, and then pay an additional amount according to a prearranged formula for the value of the nickel after Spaid was able to sell the stolen nickel to a buyer. In this case, Spaid sold the nickel briquettes to ECS Refining in Terrell, Texas, and the nickel was shipped out by Spaid's company in western Pennsylvania to Texas at his direction on or around Oct. 21, 2011. Spaid indicated to the Pennsylvania State Police, who interviewed him, that this shipment of stolen nickel was the last of at least ninethat he received from Eberhardt.
Assistant United States Attorney James T. Kitchen prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Immigration and Customs Enforcement for the investigation leading to the successful prosecution of Spaid.
Philadelphia La Cosa Nostra Capo Sentenced to<br /> 97 Months in PrisonRead the Press Release
Anthony Staino was sentenced today to serve 97 months in prison for his participation in a racketeering conspiracy involving extortion, loan sharking and illegal gambling, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania and Edward J. Hanko, Special Agent in Charge of the FBI’s Philadelphia Division.
Staino, 57, of Swedesboro, N.J., was sentenced by U.S. District Judge Eduardo C. Robreno in the Eastern District of Pennsylvania. In addition to his prison term, Staino was sentenced to serve three years of supervised release.
On Apr. 19, 2013, Staino pleaded guilty to conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. Through court documents and statements made in court at the time of the plea, Staino admitted that, as a made member and capo of the Philadelphia LCN Family, he gave a usurious loan to an undercover FBI agent and used threats of violence to collect payments on the loan. Staino also admitted that he ran an illegal electronic gambling device business for the mob, providing video poker machines and other gambling devices for bars, restaurants, convenience stores, coffee shops and other locations in Philadelphia and its suburbs, and then collected the illegal gambling proceeds.
A total of 12 leaders, members and associates of the Philadelphia LCN Family have pleaded guilty or been convicted by a jury as part of this case. Eight of the defendants, including Staino, have been sentenced, and four are awaiting sentencing.
The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole of the Eastern District of Pennsylvania. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
The case is being investigated by the FBI, Internal Revenue Service-Criminal Investigation, Pennsylvania State Police, New Jersey State Police, Philadelphia Police Department, U.S. Department of Labor’s Office of Inspector General Office of Labor Racketeering and Fraud Investigations, and U.S. Department of Labor’s Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.
Patrick Charles Thomas Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on July 15, 2013, before U.S. Magistrate Judge Keith Strong, PATRICK CHARLES THOMAS, a 55-year-old resident of Cut Bank, pled guilty to (2) counts of conversion of secured property. Sentencing has been set for October 21, 2013. He is currently released on special conditions.
In an Offer of Proof filed by Assistant U.S. Attorney Carl E. Rostad, the government stated it would have proved at trial the following:
THOMAS was a rancher/farmer near Cut Bank who obtained, over the years, numerous loans from the U.S. Department of Agriculture, Farm Services Agency (FSA). As part of that lending and borrowing relationship, THOMAS pledged as collateral all livestock, crops, and personal property.
Beginning in or before June of 2006, THOMAS began to sell off hay, grass (grazing), cattle, equipment, and other pledged assets without notifying the FSA of the transactions or the income generated from the sale of those assets.
On December 18, 2008, THOMAS submitted a balance sheet to support his application for financing through FSA showing he had 225 bred cows which would be used as collateral. The FSA had concerns regarding the actual number of cows. They had not been able to get an actual count of the cattle for some time and when chattel inspections had been completed it did not appear that there were as many cattle as they thought should be there. FSA conducted a count December 29, 2008, and located 169 head. When questioned about the discrepancy and the missing 59 head of cows, THOMAS stated they had gone down into Flat Coulee on his neighbor's place and he couldn't get them up.
On March 2, 2009, THOMAS was approved for a $65,000 annual operating loan from FSA which also rescheduled THOMAS's existing FSA loans according to DALR$ (FSA's loan servicing program). The projections used were based, in material part, on the cow numbers shown on the Security Agreement dated December 19, 2008, which showed 225 head of cows and 11 bulls.
On March 31, 2009, FSA performed a chattel inspection and recorded approximately 180 head of cows. Later that year, in October 2009, without notifying or receiving the approval of the FSA, THOMAS sold 105 calves to a Nebraska-based cattle buyer without disclosing to the buyer that the calves were pledged as security to the FSA. THOMAS concealed the sale from the FSA and converted the proceeds - $49,776 - to his own use and benefit.
On February 22, 2010, FSA went to THOMAS's ranch to do a chattel inspection and cattle count for both the Farm Loan Program and for THOMAS's daughter's 2009 LIP claim. FSA counted 99 cows and 3 yearlings, of which 62 were THOMAS's and 6 of which belonged to his daughter. FSA representatives could not read the brand on the remaining 33 head.
On April 22, 2010, FSA and representatives of the Montana Department of Livestock went to THOMAS's ranch to count the cattle. The final tally that day was 81 head of cows, of which 70 had THOMAS's brand, and 11 had other family member's brands. There were also 53 head of unbranded calves. The numbers were significantly less than what FSA had collateralized - or believed to have collateralized on the basis of THOMAS's representations.
Investigation established that between June 11, 2006, and July 13, 2011, THOMAS disposed of and sold at least $162,865.36 in cattle, hay, equipment and other property he had pledged as a collateral to obtain FSA loans, and in which the FSA had a security interest, without the knowledge or approval of the FSA.
THOMAS faces possible penalties of 5 years in prison, a $250,000 fine and 3 years supervised release on each count.
The investigation was conducted by the / a cooperative effort between the U.S. Department of Agriculture - Office of Inspector General.
Nicholas Co. Man Gets Federal Prison Time for Oxycodone Distribution and Money Laundering SchemeRead the Press Release
Keith Keiffer received packages containing thousands of powerful painkiller pills by mail from Fla.; deposited at least $30,000 in bank as payment for pills
CHARLESTON, W.Va. – A Nicholas County pill dealer was sentenced today to four years in federal prison in connection with an oxycodone distribution and money laundering scheme, announced U.S. Attorney Booth Goodwin. Keith Keiffer, 32, of Calvin, Nicholas County, W.Va., previously pleaded guilty in February to conspiracy to distribute oxycodone and conspiracy to commit money laundering. From at least August 31, 2011 until April 27, 2012, Keiffer received at least 15 express mail packages that contained a total of approximately 1,400 30-milligram oxycodone tablets from an individual located in Tampa, Fla. In exchange for the oxycodone tablets, Keiffer deposited cash into bank accounts that were owned and controlled by his pill source of supply. Keiffer deposited at least $30,000 in cash payments in exchange for the oxycodone tablets. Additionally, between June 2011 and February 2012, Keiffer received several hand-delivered packages that contained a total of approximately 4,150 oxycodone tablets from an individual who made trips to West Virginia from Florida.
The West Virginia State Police Bureau of Criminal Investigations, the U.S. Postal Inspection Service, Internal Revenue Service - Criminal Investigation, and the Drug Enforcement Administration conducted the investigation. Assistant United States Attorney Haley Bunn handled the prosecution. The sentence was imposed by United States District Judge Irene C. Berger.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Minnesota Woman Sentenced for Failure to Pay Child SupportRead the Press Release
United States Attorney Brendan V. Johnson announced that an Inver Grove Heights, Minnesota, woman charged with Failure to Pay Legal Child Support pled guilty and was sentenced on July 15, 2013, by U.S. District Court Judge Karen E. Schreier.
Allison R. Konstanz, age 35, was sentenced to five years of probation, a $100.00 special assessment to the Federal Crime Victims Fund, and child support restitution in the amount of $39,033.55.
Konstanz was indicted by a federal grand jury on January 8, 2013, for failing to pay over $39,428.00 in past due child support. She was ordered by the First Judicial Circuit Court, Bon Homme County, South Dakota, to pay $459.07 per month for her minor child, commencing April 1, 2001. At the time of indictment, she had not made a child support payment since February of 2011, and the total arrearage amount was $39,428.34.
This case was investigated the Department of Health and Human Services, Office of Inspector General Assistant U.S. Attorney Thomas J. Wright prosecuted the case.
The defendant was released from custody.Minneapolis Felon Pleads Guilty to Possessing A Nine-millimeter PistolRead the Press Release
MINNEAPOLIS—Earlier today in federal court in St. Paul, a 59-year-old Minneapolis felon pleaded guilty to possessing a nine-millimeter pistol. Robert Lee Powers pleaded guilty to one count of being a felon in possession. Powers, who was indicted on April 22, 2013, entered his plea before United States District Court Judge Susan Richard Nelson.
In his plea agreement, Powers admitted that on March 18, 2013, during the execution of a state search warrant of his residence, police recovered a nine-millimeter, semi-automatic pistol and approximately five grams of heroin. Because he is a felon, he is prohibited under federal law from possessing a firearm at any time. He was previously convicted in Hennepin County for third-degree sale of crack cocaine (1989), offering a forged check (1992), fourth-degree sale of crack cocaine (1992), attempted first-degree criminal sexual conduct (1992), a third-degree controlled substance crime (2000), an attempted fifth-degree controlled substance crime (2004 and 2005), a fifth-degree controlled substance crime (2008 and 2009), and theft of a motor vehicle (2009). In addition, Powers was convicted in Washington County for conspiracy to commit a controlled substance crime (1996) and being a predatory offender providing false information (2005).Because at least three of these convictions constituted violent crimes or major drug crimes, Powers is subject to the federal Armed Career Criminal Act. That act mandates a minimum of 15 years in federal prison for anyone subsequently convicted under federal law for being a felon in possession of a firearm or ammunition. Judge Nelson will determine Powers’s sentence at a future hearing, yet to be scheduled.
This case is the result of an investigation by the Minneapolis Police Department and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives. It is being prosecuted by Assistant U.S. Attorney Thomas M. Hollenhorst.
The case was charged federally through Project Exile Minneapolis. That law enforcement initiative was launched on July 22, 2010, as part of a city-wide effort to reduce gun violence. Through Project Exile, the Minneapolis Police Department and the ATF work together to apprehend serial criminals for violations of gun laws. Then, the Hennepin County Attorney’s Office teams up with the U.S. Attorney’s Office to determine where those offenders will most effectively be prosecuted – state or federal court. Those determinations are based on the offenders’ criminal histories and current charges, among other factors. To date, the U.S. Attorney’s Office has brought charges against more than two dozen serious habitual criminals through Project Exile Minneapolis.Michigan Man Sentenced for Lacey Act ViolationRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rockford, Michigan, man has pled guilty and been sentenced for a Lacey Act Violation.
Robert Klawieter, age 56, appeared before U.S. Magistrate Judge John E. Simko on July 15, 2013, and pled guilty. Klawieter was sentenced to 1 year unsupervised probation, a $2,500 fine, $1,000 in restitution, and a $25 special assessment to the Federal Crime Victims Fund. He was charged by an Information filed on April 3, 2013.
The charges stem from an incident occurring in November 2011 in which Klawieter did knowingly transport, sell, receive, and acquire one white-tailed buck deer in interstate commerce from South Dakota to Michigan, when he did not have the proper tag for the illegally harvested deer.
The investigation was conducted by the U.S. Fish and Wildlife Service. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.Mexican National Indicted for Illegal Re-entry After DeportationRead the Press Release
MINNEAPOLIS—Earlier today in federal court, a 27-year-old Mexican national was indicted for entering the United States illegally after previously being deported as an aggravated felon. Hector Rios-Guzman was specifically charged with one count of illegal re-entry after deportation.
The indictment alleges that on May 15, 2013, Rios-Guzman, also known as Hector Rios, was found in the U.S. after being deported to Mexico in 2012, following a 2004 Hennepin County conviction for terroristic threats. On May 15, 2013, Rios-Guzman was arrested following a traffic stop in Bloomington. According to a law enforcement affidavit filed in the case, Rios-Guzman fled the scene on foot before he was arrested. Rios-Guzman has a previous conviction in the District of Minnesota for illegal re-entry.
If convicted of the federal charges now levied against him, Rios-Guzman will face a potential maximum penalty of 20 years in federal prison, followed by deportation. Any sentence would be determined by a federal district court judge.
This case is the result of an investigation by ICE’s Enforcement and Removal Operations. It is being prosecuted by Assistant U.S. Attorney Clifford B. Wardlaw.An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.
Maryland Man Pleads Guilty to 12 Felony ChargesRead the Press Release
In Series of Burglaries at University Dormitory
-Took Laptops, Other Items in January 2013 at George Washington University-WASHINGTON - James Dunmore, 39, of Hyattsville, Md., pled guilty today to first-degree burglary and other felony charges stemming from a series of burglaries he committed this year at George Washington University, U.S. Attorney Ronald C. Machen Jr. announced.
Dunmore pled guilty in the Superior Court of the District of Columbia to a total of 12 charges, including first-degree burglary, second-degree burglary, second-degree theft, and unlawful entry. The Honorable Robert I. Richter set sentencing for Sept. 13, 2013. Dunmore faces a potential sentence of more than 20 years in prison.
According to a proffer of evidence, signed by the defendant as well as the government, Dunmore entered a total of five apartments in January 2013 in the Ivory Tower Dormitory at George Washington University in Northwest Washington. Over two separate days, he took various electronic items, including laptops, and other property belonging to seven students.
The series of crimes began on Jan. 25, 2013. That day, Dunmore entered the residence hall and went into a student’s apartment while the student was in the shower. He took a laptop and the student’s wallet, which contained the student’s G-World card, a student ID card that can be used to electronically gain entry to the university’s buildings.
Then, on Jan. 28, 2013, Dunmore entered four more apartments in the same building. He got into the residence hall at about 1:30 p.m. by following another student into the building. First, he went to the sixth floor, where he entered three separate apartments. He took a pillowcase, three laptops, a camera and an iPod from one apartment. In another, a student was asleep in bed when Dunmore entered the room and pretended to be looking for someone he knew; he took an iPod from that apartment. He went into a third apartment on the sixth floor, but left without taking anything after he saw someone there. Dunmore then went to the building’s third floor and entered yet another apartment, taking two laptops, a video game system, and a student’s suitcase, which he used to carry the items away.
One student became suspicious of Dunmore’s activities and alerted campus police, who stopped Dunmore on his way out of the building with the stolen items in his possession.
In announcing the plea, U.S. Attorney Machen expressed his appreciation to the Metropolitan Police Department and the George Washington University Police Department. He also acknowledged the efforts of Paralegal Specialists Allison Gregory Daniels and Victim/Witness Advocates Kristina Rose and Katina Adams-Washington, as well as Intern Julie Herward. Finally, he commended the work of Assistant U.S. Attorney Scott Sroka, who investigated and indicted the case.
13-248
Maryland Man Found Guilty of Felony ChargesRead the Press Release
In 2012 Shooting in Southeast Washington
-He and Another Man Targeted Victims Who Were in a Car-WASHINGTON - Delonte Smith, 20, of Capitol Heights, Md., was found guilty by a jury today of assault with a dangerous weapon and other charges stemming from a shooting that took place last year in Southeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Smith, also known as “Unc,” was found guilty in the Superior Court of the District of Columbia of one count of conspiracy to commit a crime of violence, two counts of assault with a dangerous weapon, two counts of possession of a firearm during a crime of violence, and two counts of simple assault. The verdicts followed a two-week trial. The Honorable Heidi M. Pasichow scheduled sentencing for Sept. 20, 2013.
According to the government’s evidence, at about 7:30 p.m. on Dec. 11, 2012, Smith approached a vehicle that was parked in the 5000 block of H Street SE and told the man in the driver’s seat to get out. When the driver refused, Smith tried to open the car door, which was locked. He then walked around the vehicle to the passenger’s side and told the woman in the front passenger’s seat to get out of the car.
In the meantime, Smith’s best friend and accomplice, Jeffrey Ray Tyson, 20, also known as “Baby Boy,” approached the driver’s side door and produced a handgun. Tyson tapped several times on the driver’s side window with the handgun and ordered the driver out of the car. The driver refused, put the car into drive, and attempted to drive away from the area. Tyson fired six shots at the vehicle, at least two of which hit the car. Although neither of the people in the car was hit, the two rounds that struck the vehicle were in the direction of the driver’s head. The car’s occupants flagged down patrol officers just a few blocks away.
Tyson died as the result of a homicide five days later, in an unrelated incident.
In announcing the verdict, U.S. Attorney Machen expressed appreciation for the work of the Metropolitan Police Department (MPD,) which investigated the case. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Antoinette Sakamsa and Tony Griffith; Litigation Technology Specialists Leif Hickling and Claudia Gutierrez; Victim/Witness Advocate Jim Brennan, Victim/Witness Supervisor Michael Hailey, Victim/Witness Security Specialist Tanya Via, and Victim/Witness Services Coordinator David Foster. Finally, he praised the work of Assistant U.S. Attorney Richard E. DiZinno, who prosecuted the case.
13-251Martha Mae Mitchell Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on July 16, 2013, before U.S. Magistrate Judge Keith Strong, MARTHA MAE MITCHELL, a 57-year-old resident of Box Elder and an enrolled member of the Chippewa Cree Tribe, pled guilty to assault resulting in serious bodily injury. Sentencing has been set for October 22, 2013. She is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Danna R. Jackson, the government stated it would have proved at trial the following:
On January 23, 2013, MITCHELL became frustrated when a 9-month-old child would not stop crying. MITCHELL told law enforcement that she twisted the baby's legs and both arms causing injuries to them. MITCHELL further told law enforcement that she was "shocked and disgusted" at herself. The crime occurred within the exterior boundaries of the Rocky Boy's Indian Reservation.
Medical evidence would have shown that the victim suffered fractures to all four of the baby's limbs. The victim was hospitalized for a week. The medical evidence would also show that the victim sustained additional injuries that may not be attributed to MITCHELL's conduct.
MITCHELL faces possible penalties of 10 years in prison, a $250,000 fine and 3 years supervised release.
The investigation was conducted by the Federal Bureau of Investigation.
Manhattan U.S. Attorney Announces Charges Against Eight Individuals in Connection with $2.3 Million Bribery and Kickback Scheme to Secure Business from A Medical Cost-Management CompanyRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Thomas O’Donnell, the Special Agent-in-Charge of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), and Steven G. Hughes, the Special Agent-in-Charge of the New York Office of the U.S. Secret Service today announced charges against eight individuals for their alleged involvement in a lucrative scheme in which information technology vendors paid over $2.3 million in bribes and kickbacks to secure business from executives of a Manhattan-based medical cost management company (the “New York Company”). The defendants charged with paying the bribes and kickbacks are SARVESH DHARAYAN, SANJAY GUPTA, VENKATA ATLURI, RANGARAJAN KUMAR, VADAN KUMAR KOPALLE, and DARREN SIRIANI. The defendants charged with receiving the bribes and kickbacks are ANIL SINGH and KEITH BUSH. DHARAYAN, GUPTA, KOPPALLE, and SIRIANI were arrested this morning at their homes in New Jersey, and were presented in Manhattan federal court this afternoon before U.S. Magistrate Judge James L. Cott. SINGH, who was previously arrested in April 2013, pled guilty to honest services fraud and other charges before U.S. District Judge Denise L. Cote on July 11, 2013. BUSH, who was also arrested previously on July 12, 2013, is next scheduled to appear in court for a pretrial conference on August 15, 2013. ATLURI and KUMAR are not yet in custody.
Manhattan U.S. Attorney Preet Bharara said: “For the eight defendants charged in this multi-million dollar scheme, bribes and kickbacks were allegedly the cost they imposed for doing business with this medical-cost management company. As today’s charges detail, the defendants achieved their years-long fraud through fake companies, sham invoices and made-up consulting services. Today’s actions underscore our commitment to work with our law enforcement partners to bring to justice individuals who break the law out of greed.”
HHS-OIG Special Agent-in-Charge Thomas O’Donnell said: “This scheme was motivated by greed and it deprived its victim, a company in the health care field, of the honest labor of its employees. We will continue to aggressively investigate those who pay kickbacks and bribes to gain an advantage in the public and private health care sectors.”
USSS Special Agent-in-Charge Steven G. Hughes said: “The Secret Service continues to enjoy its partnership with the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General. We find partnerships such as this to be an effective way to share resources and stop criminals from continuing to engage in fraudulent schemes.”
According to the allegations contained in the Complaint, the Informations filed against BUSH and SINGH, and other statements made in Manhattan federal court:
SINGH was employed as a Senior Vice President and the Chief Information Officer at the New York Company, which provided nation-wide medical cost management solutions including, among other things, medical reimbursement services, and BUSH was employed as the company’s Director of Database Administration. SINGH and BUSH had considerable influence over the selection of vendors, specifically vendors of database administrators (“DBAs”), hired by the New York Company.
From 2008 to September 2012, various individuals collectively paid over $2.3 million in money and other benefits to SINGH and BUSH in exchange for SINGH’s and BUSH’s agreement to steer millions of dollars of the New York Company’s DBA business to them. Specifically, as alleged:
- DHARAYAN, the owner of a New Jersey information technology company (“Vendor 1”) and GUPTA, an employee of Vendor 1, paid approximately $1,722,620 in kickbacks and bribes to BUSH and SINGH in exchange for receiving DBA business from the New York Company. From 2010 to 2012, the New York Company paid Vendor 1 approximately $6,625,479.20 for placing DBAs with the New York Company.
- ATLURI, the owner of another New Jersey information technology company (“Vendor 2”), paid approximately $190,436.75 in kickbacks and bribes to BUSH and SINGH in exchange for receiving DBA business from the New York Company. From 2008 to 2012, the New York Company paid Vendor 2 approximately $11,495,804.88 for placing DBAs with the New York Company.
- KUMAR paid approximately $247,634 in kickbacks and bribes to BUSH and SINGH in exchange for their agreement to steer DBA business to another New Jersey information technology company (“Vendor 3”). From 2009 to 2012, the New York Company paid Vendor 3 approximately $2,593,210.38 for placing DBAs with the New York Company.
- KOPALLE, who was in charge of delivery and operations at a Texas information technology company (“Vendor 4”), paid approximately $142,967.50 in kickbacks and bribes to BUSH and SINGH in exchange for receiving DBA business from the New York Company. From 2009 to 2010, the New York Company paid Vendor 4 approximately $1,035,660 for placing DBAs with the New York Company.
- SIRIANI, the owner and operator of another New Jersey information technology company (“Vendor 5”) paid approximately $23,000 to $29,000 in cash kickbacks and bribes to BUSH and SINGH in exchange for receiving business from the New York Company. SIRIANI also paid for hotel rooms in Las Vegas and Costa Rica, deep sea fishing, massages, sports tickets, and other things, all in exchange for receiving business from the New York Company. From 2008 to 2012, the New York Company paid Vendor 5 approximately $1,177,600.91 for various services and products.
According to the Complaint, DHARAYAN, GUPTA, ATLURI, KUMAR, and KOPALLE paid the kickbacks and bribes through conduit companies established by BUSH and SINGH for the very purpose of disguising the true nature and origin of the illegal payments. To further conceal the bribery and kickback scheme, BUSH and SINGH sent false invoices to the conduit companies for consulting services that never occurred. Many of the kickbacks and bribes were paid pursuant to these false invoices.
DHARAYAN, 42, of Edison, New Jersey, GUPTA, 38 of East Windsor, New Jersey, ATLURI, 41, of Monmouth Junction, New Jersey, KUMAR, 47, of Monroe, New Jersey, KOPALLE, 43, of Edison, New Jersey, and SIRIANI, 45, of Matawan, New Jersey, were each charged with one count of conspiracy to commit honest services fraud, which carries a maximum term of 20 years in prison, one count of conspiracy to violate the Travel Act, which carries a maximum term of five years in prison, one count of honest services fraud, which carries a maximum term of 20 years in prison, and one count of violating the Travel Act, which carries a maximum term of five years in prison. DHARAYAN, GUPTA, ATLURI, KUMAR, and KOPALLE were also charged with one count of conspiracy to commit money laundering, which carries a maximum term of 20 years in prison.
SINGH, 40, a resident of East Brunswick, New Jersey pled guilty to one count each of conspiracy to commit honest services fraud, conspiracy to violate the Travel Act, honest services fraud, violating the Travel Act, and conspiracy to commit money laundering. He faces a maximum penalty of 70 years in prison on all counts. BUSH, 41, a resident of Rahway, New Jersey, is charged with one count each of conspiracy to commit honest services fraud, conspiracy to violate the Travel Act, honest services fraud, violating the Travel Act, and conspiracy to commit money laundering. He also faces a maximum penalty of 70 years in prison if convicted on all counts.
Mr. Bharara praised the outstanding efforts of HHS-OIG and the U.S. Secret Service in the investigation. He also thanked the New York Company for its assistance and cooperation in the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorney Jason P. Hernandez is in charge of the prosecution. Assistant U.S. Attorney Christine Magdo of the Office’s Asset Forfeiture Unit is responsible for the forfeiture aspects of the case.
The charges and allegations contained in the Complaint and the Information filed against BUSH are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
U.S. v. Sarvesh Dharayan, et al. Complaint
U.S. v. Anil Singh Information
U.S. v. Keith Bush InformationManhattan U.S. Attorney and FBI Assistant Director-In-Charge Announce Arrest of California Man for Attempted Sex Trafficking and Possession and Distribution of Child PornographyRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), today announced the arrest of CHARLES FAMILETTI, JR. for attempted sex trafficking of a minor as well as for possession and distribution of child pornography. FAMILETTI was arrested by FBI agents in the afternoon of Monday, July 15, 2013, at a corporate apartment that he rents in Manhattan. He was presented Monday evening before U.S. Magistrate Judge James L. Cott in Manhattan federal court.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Charles Familetti not only possessed and distributed child pornography, but even more disturbingly, agreed to pay hundreds of dollars to arrange to have sex with a child. Thanks to the efforts of the FBI, Familetti’s alleged illicit conduct was brought to light, and he will now have to answer to these serious charges.”
FBI Assistant Director-in-Charge George Venizelos said: “There may be no more important mission for the FBI than protecting the most vulnerable of victims. As alleged, this defendant not only possessed and distributed child pornography, he paid someone in an attempt to rape an 11-year-old child. Child pornography is itself predatory, because children are victimized to produce it.”
According to the allegations contained in the Complaint filed in Manhattan federal court:
FAMILETTI was arrested following an FBI sting operation in which he agreed to pay an undercover FBI agent $500 in order to have sex with an 11-year old boy. On July 15, 2013, FAMILETTI met with the undercover agent to confirm the agreement and then took the agent to an ATM and gave him a $100 down payment. Prior to that meeting, FBI agents downloaded what appeared to be several images of child pornography from FAMILETTI via a publically available peer-to-peer file sharing network. During a search of FAMILETTI’s apartment following his arrest, FBI agents also recovered a memory card containing hundreds of images and videos of what appeared to be minor children engaging in sexually explicit conduct.
FAMILETTI, 46, of San Francisco, California, is charged with one count of attempted sex trafficking of a minor, which carries a mandatory minimum sentence of 15 years in prison and a maximum penalty of life in prison. He is also charged with one count of transporting or distributing child pornography, which carries a mandatory minimum sentence of five years in prison and a maximum sentence of 20 years in prison, and one count of possessing child pornography which carries a maximum sentence of 10 years in prison. All three counts also carry a maximum fine of $250,000 or twice the gross gain or loss from the offense.
Mr. Bharara praised the outstanding investigative work of the FBI. He added that the investigation is continuing.
The FBI encourages the public to report suspected child predators and any suspicious activity through their switchboard at (212) 384-1000. It is staffed around the clock by investigators. Suspected child sexual exploitation or missing children may be reported to the National Center for Missing and Exploited Children, an Operation Predator partner, at 1-800-843-5678 or http://www.cybertipline.com.
The prosecution is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Patrick Egan is in charge of the prosecution.
The charges contained in the Complaint are merely an accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Charles Familetti Complaint
Man Pleads Guilty to Possessing A Stolen FirearmRead the Press Release
MINNEAPOLIS—Earlier today in federal court in St. Paul, a 31-year-old man pleaded guilty to possessing a stolen handgun. Nathan Anderson, of Bloomington, pleaded guilty to one count of possession of a stolen firearm. Anderson, who was charged yesterday via an Information, entered his plea before United States District Court Judge Susan Richard Nelson.
In his plea agreement, Anderson admitted that at approximately 10 p.m. on March 2, 2013, he fell asleep while waiting for his food at a McDonald’s drive-through in Bloomington. Store employees contacted the police, who met with Anderson and found a loaded .45-caliber pistol in his coat. In addition, Anderson admitted that he knew the pistol had been stolen.
For his crime, Anderson faces a potential maximum penalty of ten years in prison. Judge Nelson will determine his sentence at a future hearing. This case is the result of an investigation by the Bloomington Police Department, and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant U.S. Attorney Amber M. Brennan.Madison Man Pleads Guilty to Passing Counterfeit United States CurrencyRead the Press Release
United States Attorney Brendan V. Johnson announced that Adrian Daniel Logan, age 26, of Madison, South Dakota, appeared before U.S. District Judge Karen E. Schreier on July 17, 2013, and pled guilty to Passing Counterfeit United States Currency.
The maximum penalty upon conviction is 20 years in custody, a $250,000 fine, or both; 3 years of supervised release; and $100 to the Federal Crime Victims Fund.
The conviction stems from an incident that took place on January 10, 2013, when Adrian purchased a bottle of pop from the La Tapatia Mexican Store in Sioux Falls, and paid for it with a counterfeit $20 bill. After receiving genuine currency as change from the store clerk, Logan attempted to pass another counterfeit $20 bill by requesting change for it. When the cashier recognized the second bill as counterfeit, Logan fled the store.
The investigation was conducted by the Madison Police Department, the Sioux Falls Police Department, and the U.S. Secret Service. The case is being prosecuted by Assistant U.S. Attorney Jeffrey C. Clapper.
A presentence investigation was ordered and a sentencing date was set for October 7, 2013. The defendant was released on bond pending sentencing.Long Island Art Dealer Indicted for Massive Art Fraud, Money Laundering, and Tax SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Toni Weirauch, the Special Agent-in-Charge of the New York Field Division of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), and George Venizelos, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the filing of a seven-count Indictment charging GLAFIRA ROSALES, an art dealer, with participating in a $30 million fraud in which she sold over 60 works of fake art to two Manhattan galleries. ROSALES was also charged with money laundering and tax crimes related to the art fraud scheme. Rosales, who was originally charged in a complaint, was arrested on May 21, 2013. The case has been assigned to U.S. District Court Judge Katherine Polk Failla and ROSALES will be arraigned on Friday, July 19, 2013, at 11 a.m.
Manhattan U.S. Attorney Preet Bharara said: “The indictment depicts a complete circle of fraud perpetrated by Glafira Rosales – fake paintings sold on behalf of non-existent clients with money deposited into a hidden bank account. The one thing about this story that is true is that this alleged fraud will be prosecuted.”
IRS Special Agent-in-Charge Toni Weirauch said: “The tax charges alleged in this indictment center on the concealment of taxable income from the sale of counterfeit paintings. This investigation is an excellent example of how the government is dedicated to detecting and investigating all kinds of income tax fraud schemes and seeing that those who commit tax fraud are prosecuted. It is important for the public to feel confident that their government is working to ensure that everyone pays their fair share.”
FBI Assistant Director-in-Charge Venizelos said: “As the indictment alleges, Glafira Rosales knowingly peddled fakes to two Manhattan art galleries. To prolong her scheme for a decade-and-a-half, not only the paintings were fake, but the stories behind them as well. The pictures Rosales painted of the anonymous Swiss client – a pure fiction – and the Spanish collector – a real person but not, as purported, the owner of any of the paintings – were as fake as the dozens of works she attributed to the modern masters.”
According to the allegations contained in the Indictment and the Complaint filed in Manhattan federal court:
Starting in 1994 and continuing through 2009, ROSALES sold more than 60 never-before exhibited and previously unknown works of art that she claimed were painted by some of the most famous artists of the 20th century, including Jackson Pollock, Mark Rothko, and Willem de Kooning. ROSALES sold these works of art to two prominent Manhattan galleries for approximately $33.2 million. In selling some of the paintings to the two galleries, she purported to represent a client with ties to Switzerland who had inherited the paintings and wanted to sell them, but who also wished to remain anonymous (the “Purported Swiss Client”). For the remainder of the paintings, she purported to represent a Spanish collector (the “Purported Spanish Collector”). ROSALES also claimed that a portion of the price paid by the Manhattan galleries would be her commission for selling the paintings and that the remainder would be passed along to her clients.
In contrast to the claims made by ROSALES, as alleged in the Indictment:
- the paintings ROSALES sold were fake, that is, not by the hand of the artists that she represented them to be;
- ROSALES knew that the paintings were counterfeit and that the statements she made about their provenance were false;
- the Purported Swiss Client on whose behalf she purported to sell most of the paintings to the Manhattan galleries never existed;
- the Purported Spanish Collector on whose behalf she claimed to sell the remainder of the paintings to the Manhattan galleries never owned the paintings;
- instead of passing along a substantial portion of the proceeds of the sale of the various paintings, she kept all or substantially all of the proceeds, and transferred substantial portions of the proceeds to an account maintained by her then-boyfriend; and
- ROSALES concealed and disguised the nature, location, source, ownership, and control of the proceeds of sales of the fake works by causing the Manhattan galleries to transfer substantial portions of the proceeds of the sales to foreign bank accounts, and by transferring, and causing to be transferred, proceeds of the sales from foreign bank accounts to accounts maintained in the United States.
ROSALES filed tax returns that falsely claimed she had not kept all, or substantially all of the proceeds from the sale of the purported clients’ paintings, when, in fact, she kept all or nearly all of the proceeds. In total, she failed to report the receipt of at least $12.5 million of income for the years 2006 through 2008.
In addition, ROSALES received most of the proceeds from the sale of the paintings in a foreign bank account that she hid from, and failed to report to, the IRS. U.S. taxpayers are required to report the existence of any foreign bank account that holds more than $10,000 at any time during a given year by the filing of a Report of Foreign Bank and Financial Accounts, Form TD F 90-22.1 (“FBAR”). ROSALES failed to file FBARs for the years 2010 and 2011.
ROSALES, 56, of Sands Point, New York, is charged with one count of wire fraud, which carries a maximum of 20 years in prison; one count of money laundering, which carries a maximum of 20 years in prison; three false tax return charges, each of which carries a maximum of three years in prison; and two willful failure to file FBAR charges, each of which carries a maximum sentence of five years in prison.
Mr. Bharara praised the outstanding efforts of IRS-CI and FBI in the investigation, which he noted is ongoing. He also thanked the Department of Justice’s Tax Division for their significant assistance in the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Jason P. Hernandez and Daniel W. Levy are in charge of the prosecution.
The charges and allegations contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Glafira Rosales Indictment
KC Man Indicted for Child Sex Trafficking, Producing Child PornRead the Press Release
Human Trafficking Rescue Project
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Kansas City, Mo., man has been indicted by a federal grand jury on charges related to child sex trafficking and producing child pornography as part of a scheme that generated more than $200,000 over a three-year period.
Michael Dye, 46, of Kansas City, was charged in a six-count indictment returned under seal by a federal grand jury on Tuesday, July 16, 2013. That indictment was unsealed and made public today upon Dye’s arrest and initial court appearance. Dye remains in federal custody pending a detention hearing on Monday, July 22, 2013.
The federal indictment charges Dye with two separate counts of producing child pornography. Dye allegedly victimized two minors, identified as Child Victim #1 and Child Victim #2, to produce child pornography between June 15, 2005 and Aug. 18, 2008. The indictment also alleges that Dye prostituted Child Victim #2 between June 15, 2005 and Aug. 4, 2007.
Dye is charged with two counts of selling child pornography related to each of the two child victims. Dye is also charged with one count of grooming Child Victim #1 to participate in illegal activity (the production of child pornography).
In a motion filed with the court today, the government seeks to have Dye detained in federal custody without bail. According to the government’s motion, Dye’s actions giving rise to these charges include his active and repeated sexual intercourse with the minor females, his production and sale of child pornography of the two minor females and violent threats against at least one minor female should she ever inform anyone else of these incidents.
Dye allegedly profited extensively from the serial sexual exploitation of at least two minor females. In the course of this investigation, the government developed evidence that Dye used the minor females to produce child pornography for various customers. Dye allegedly exploited the two minor females to one particular individual, who – in exchange for multiple images and videos of child pornography and access to them for sexual favors – paid the two minor females a “weekly allowance” as well as gifts in the form of multiple vehicles, remodeling projects at Dye’s home, various appliances, and other cash payments in a total amount estimated up to $200,000 over a three-year period. In addition, according to the government’s motion, PayPal records show Dye’s account received approximately $8,300, composed of hundreds of transactions from dozens of individuals ranging from $14 to $61. The government will present evidence that these payments were connected to Dye’s use of at least one of the minor victims for online “cam shows” in which the minor victim would expose herself and perform sexual acts on herself for the paying customers, who were watching online.
The government also will present evidence that, during the frequent deposit of these monies into his safety deposit box, Dye told one of the minor victims that if she ever told anyone about this he would have her and her family killed.
Under federal statutes, Dye faces a potential life imprisonment upon conviction of the sex trafficking counts, as well as up to 30 years imprisonment on the production of child pornography counts and up to 20 years imprisonment on the sale of child pornography counts. Each of the two counts for the production of child pornography carries a mandatory minimum sentence of 15 years in federal prison without parole.
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 Patrick D. Daly. It was investigated by the FBI, the Western Missouri Cyber Crimes Task Force, the Clay County, Mo., Sheriff’s Department, the Platte County, Mo., Sheriff’s Department, the Naval Criminal Investigative Service, the Newport, R.I., Police Department, the Rhode Island State Police, the Winnipeg, Manitoba Police Service in Canada, the Royal Canadian Mounted Police, the Crown’s Attorney’s Office in Canada and the Child Exploitation and Online Protection Centre in the United Kingdom.
Justice Department Enters into Far-reaching Agreement with the Commonwealth of Puerto Rico to Reform the Puerto Rico Police DepartmentRead the Press Release
The Justice Department today entered into a sweeping civil rights agreement with the commonwealth of Puerto Rico to modernize and reform the Puerto Rico Police Department (PRPD). The agreement resolves a civil suit initiated by the department in December 2012 to remedy a pattern and practice of police misconduct by PRPD. The agreement represents a joint commitment to effective and constitutional policing and is the product of extensive negotiations between the department, PRPD and the administrations of Governor Alejandro García-Padilla and his predecessor Luis Fortuño. The agreement was filed with the federal court today and will become court-enforceable once it is approved by District Judge Gustavo A. Gelpí.
The agreement is designed not only to promote constitutional policing, but also to enhance public and officer safety and increase community confidence in PRPD. The far-reaching agreement is among the most extensive agreements ever obtained by the department under the police misconduct provision of the Violent Crime Control and Law Enforcement Act of 1994, and requires corrective action in 11 core areas. These areas include use of force, searches and seizures, equal protection, policies and procedures, training, supervision, civilian complaints and internal investigations, community engagement and information systems. The agreement will also provide the public with meaningful opportunities to participate in the reform process through periodic community meetings, public reports, civilian interaction committees, community surveys and the implementation of community policing principles. The agreement is expected to be fully implemented in ten years, although there is no expiration date. A technical compliance advisor will assess and report on PRPD’s compliance, as well as provide technical assistance to promote constitutional policing.
The agreement is also tailored to the unique needs of PRPD and with a recognition of the public safety challenges facing Puerto Rico. With a diverse mission and a police force of 17,000 officers, PRPD is the second largest police department in the country and serves close to four million residents. An initial capacity-building period will allow PRPD to modernize its administrative systems and professionalize its police force. Through the development of action plans, PRPD will have broad flexibility to stage implementation and allocate resources to achieve measurable results within established time frames. Once the plans are implemented, officers in all police regions will have the policy guidance, training, supervision, equipment and support they need to carry out their duties in a lawful, effective and efficient manner.
“We commend the administrations of Governor Alejandro García-Padilla and his predecessor Luis Fortuño for taking on the formidable challenge of transforming PRPD into a modern police force that embraces constitutional policing as part of its core mission,” said Attorney General Eric Holder. “Police departments that respect the rights of the people they serve earn the confidence of the public and become more effective in fighting crime. Because the agreement we are announcing today will institutionalize a culture of accountability, Puerto Rico will now have access to nearly $10 million in asset forfeiture funds, which it can use to implement the reforms contained in the agreement.”
“Under the leadership of Justice Secretary Luis Sánchez Betances, Superintendent Héctor Pesquera, and their staff, we have been able to craft a historic agreement that will give the hard-working men and women of PRPD the support and tools they need to protect civil rights and effectively engage with the community to address public safety,” said Acting Associate Attorney General Tony West. “We are also grateful to all of the community leaders, police officers and members of the public who came forward to assist our investigation and who made this day possible.”
The department’s December 2012 civil lawsuit followed a thorough investigation of PRPD’s policies and practices. The investigation uncovered wide-ranging and long-standing deficiencies that gave rise to a pattern and practice of police misconduct, including use of excessive force, use of unreasonable force designed to suppress protected speech and unconstitutional searches and seizures. The investigation also uncovered evidence that PRPD has failed to adequately investigate gender-based violence and engaged in discriminatory policing. PRPD cooperated throughout the investigation and began initiating corrective actions in response to the investigative team’s recommendations and technical assistance.
The department began negotiating an agreement with the administration of former Governor Luis Fortuño after completing the investigation in September 2011. The negotiations culminated in a preliminary agreement that was filed concurrently with the department’s complaint in December 2012. The court granted a joint request to stay the proceedings to provide Governor García-Padilla’s administration the opportunity to review and negotiate a final agreement. Once the federal court approves the agreement, the parties will select a technical compliance advisor and begin implementation.
A copy of the complaint, the final agreement, the joint motion seeking approval of the agreement, and the September 2011 letter of findings can be found at www.justice.gov/crt If individuals have information that is relevant to the case and PRPD, you may contact the Department of Justice at [email protected] or at 877-871-9726.
Informational: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on July 16, 2013, before U.S. Magistrate Judge Keith Strong, the following individuals were arraigned:
SHANNON JAMES AUGARE, a 33-year-old resident of Browning, appeared on charges of obstructing a peace officer, driving under the influence of alcohol, and reckless driving. He is currently released on special conditions. If convicted of these charges, AUGARE faces possible penalties of 6 months in prison, a $250,000 fine, and 5 years supervised release. Assistant U.S. Attorney Ryan G. Weldon is the prosecutor for the United States.
PONDERA HUTTERITE COLONY, INC., SAM KLEINSASSER, DARYL KLEINSASSER, JONATHAN WALDNER, IKE WALDNER, and TOM WALDNER appeared on charges of (2) counts of illegal possession of a threatened species. They are currently released on special conditions. If convicted of these charges, they each face possible penalties of 6 months in prison and a $25,000 fine on each count. Assistant U.S. Attorney Ryan G. Weldon is the prosecutor for the United States. The investigation was a cooperative effort between the U.S. Fish and Wildlife Service and the Montana Fish, Wildlife and Parks Department.
ROY OLIVER CAMPBELL, a 33-year-old resident of Browning, appeared on a charge of burglary. He is currently detained. If convicted of this charge, CAMPBELL faces possible penalties of 20 years in prison, a $250,000 fine, and 3 years supervised release. Assistant U.S. Attorney Ryan G. Weldon is the prosecutor for the United States. The investigation was conducted by the Federal Bureau of Investigation,
The defendants pled not guilty to the charges.
The charge, an indictment, information or complaint, is merely an accusation and all persons named as defendants are presumed innocent until proven guilty. A pre-trial conference and a trial date will be set and the United States will be required to prove the allegations set forth in the indictment beyond a reasonable doubt.
Indictments Returned in Hammond Federal CourtRead the Press Release
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
Hammond, Indiana- The United States Attorney’s Office announced that the following Indictments were returned today:
Jeremy David Evans, 31, of Glendale Heights, Illinois, was charged with the bank robbery of TCF Bank in Munster, Indiana and Fifth Third Bank in Hammond, Indiana on August 8, 2012.These charges were filed as the result of an investigation by the Federal Bureau of Investigation.This case has been assigned to and will be prosecuted by Assistant United States Attorney David Nozick.
Joshua Mijares, 34, of Griffith, Indiana, was charged with illegal re-entry into the U.S. after deportation and illegal re-entry into the U.S. after deportation subsequent to a conviction for an aggravated felony.These charges were filed as the result of an investigation by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.This case has been assigned to and will be prosecuted by Assistant United States Attorney Randall Stewart.
Sonyinee Davis-Pope, 38, of Hammond, Indiana, was charged with 11 counts of making false statements by falsifying information on an application for a position with the United States Postal Service.These charges were filed as the result of an investigation by the United States Postal Service-Office of the Inspector General.This case has been assigned to and will be prosecuted by Assistant United States Attorney Toi Houston.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.