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12 July 2013
St. Francis Man Charged with Abusive Sexual ContactRead the Press Release
United States Attorney Brendan V. Johnson announced that a St. Francis, South Dakota man has been indicted by a federal grand jury on two counts of Abusive Sexual Contact.
Alfred Theodore Boneshirt, age 59, was indicted on June 12, 2013. Boneshirt appeared before U.S. Magistrate Judge Mark A. Moreno on July 10, 2013 and pled not guilty to the indictment.
The maximum penalty upon conviction is any term of years up to life imprisonment, a $250,000 fine, or both; 5 years up to life of supervised release; and a mandatory $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges are merely accusations, and Boneshirt is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Boneshirt was released to third party custodians pending trial. A trial date has not been set.
# # #Second Defendant Pleads Guilty; Admits Illegally PossessingMachine GunRead the Press Release
BOISE – Phillip Bernardino Chavez, 29, of Las Vegas, Nevada, pleaded guilty yesterday in United States District Court to count two of a superseding indictment charging him with illegal possession of a machine gun, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, in December 2012, Chavez’s co-defendant, Ronald Alexander, offered to sell a rifle to a Nampa Police detective working undercover. After discussing the terms of a transaction, Alexander told the undercover officer that an automatic rifle would cost $3,200. Arrangements were made for the undercover officer to purchase the firearm during a controlled operation. On December 18, 2012, the undercover officer met with Alexander and Chavez. Chavez presented the undercover officer with a Pioneer Arms Corporation 7.62x25 rifle and a bag containing three magazines, in exchange for $3,200. At the conclusion of the transaction, law enforcement agents arrested Alexander and Chavez. Chavez admitted in court yesterday that he knew the firearm was a fully automatic machine gun.
Forensic examination of the firearm by ATF’s technology branch confirmed the firearm is a machine gun, as it automatically shoots more than one shot, without manual reloading, by a single function of the trigger.
The charge of illegally possessing a machine gun is punishable by up to ten years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Chavez is scheduled to be sentenced on September 23, 2013, by U.S. District Judge Edward J. Lodge at the federal courthouse in Boise.
Co-defendant Ronald Keith Alexander, 38, of Boise, pleaded guilty in May 2013 to one count of unlawfully possessing a firearm and one count of transferring a firearm in violation of the National Firearm Registration and Transfer Record. Alexander is prohibited from possessing firearms due to a 2001 felony conviction for robbery, in Walla Walla County, Washington. He is scheduled to be sentenced in federal court on July 15, 2013.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Nampa Police Department, and Boise Police Department.
The defendants are being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Philadelphia La Cosa Nostra Associate<br /> Sentenced to 96 Months in PrisonRead the Press Release
Gary Battaglini was sentenced today to serve 96 months in prison for his participation in a racketeering conspiracy involving 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.
Battaglini, 52, of Sewell, N.J., was sentenced by U.S. District Judge Eduardo C. Robreno in the Eastern District of Pennsylvania. In addition to his prison term, Battaglini was sentenced to serve three years of supervised release.
On Feb. 5, 2013, after a four-month trial, a jury convicted Battaglini of conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. The evidence at trial proved that, in furtherance of the racketeering conspiracy, Battaglini, as an LCN Family “associate,” engaged in loan sharking and illegal sports bookmaking activities on behalf of the mob. Battaglini exploited the violent reputation of the Philadelphia LCN Family in extending usurious loans and collecting payments on the loans, leaving the borrowers in fear of physical harm if they did not pay promptly.
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.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. Six of the defendants, including Battaglini, have been sentenced, and six are awaiting sentencing.
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.
Perry County Man Charged with Methamphetamine ConspiracyRead the Press Release
A DuQuoin, IL, resident was indicted on July 9, 2013, charging conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
On July 11, 2013, Ty W. Dusch, 49, was arraigned in United States District Court in Benton on the charge. The indictment alleges that the offense occurred between 2011 and June 2013 in Jackson and Perry Counties. Dusch is currently being held without bond pending a July 16, 2013, detention hearing.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
If convicted, Dusch faces a term of imprisonment of up to 20 years, a $1,000,000 fine, and 3 years of supervised release.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, and Drug Enforcement Administration.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Paul Daniel Bottomley Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on July 12, 2013, before Chief U.S. District Judge Dana L. Christensen, PAUL DANIEL BOTTOMLEY, a 48-year-old resident of Belgrade, Montana, was sentenced to a term of:
Probation: 5 years with 6 months home confinement
Special Assessment: $100
Forfeiture (civil): $4,454,278.17
Community Service: 200 hours
Bottomley was sentenced in connection with his guilty plea to Misprision of a Felony.
In an Offer of Proof filed by Assistant U.S. Attorney Jessica T. Fehr, the government stated it would have proved at trial the following:
Paul Daniel Bottomley owned a company called Montana Health Care Solutions (MHCS) in Belgrade, Montana. MHCS was opened in 2008 and was sold to Rockley Ventures, Ltd., a division of Canada Drugs, Ltd., in October of 2010. While owned by Bottomley, MHCS imported and distributed misbranded and unapproved drugs from foreign countries to American physicians. Bottomley's conduct while the owner of MHCS was in direct violation of the Food, Drug, and Cosmetics Act (FDCA) of the United States.
Specifically, Bottomley as the owner of MHCS distributed what were classified as "new drugs" under 21 U.S.C. § 321(p) that required approval by the U.S. Food and Drug Administration (FDA) under 21 U.S.C. § 355 before they could be imported into the United States. The foreign prescription drugs distributed by Bottomley were not typically the versions that the FDA had approved for use in the United States, because, among other things, the drugs' labeling information did not conform to the FDA approved labeling for the United States versions. For example, the labeling for the foreign versions failed to contain the National Drug Code (NDC) numbers, which are part of the FDA approved labeling for versions approved for use in the United States. In addition, some of the drugs distributed by Bottomley contained non-English language labeling, including use and dosage instructions.
In October of 2010, Bottomley sold MHCS to Rockley Ventures, Ltd., a subsidiary of Canada Drugs, Ltd. Canada Drugs is an internet based pharmacy corporation located in Winnipeg, Manitoba, Canada. Rockley Ventures paid Bottomley $5 million for MHCS. Canada Drugs, Rockley Ventures, and the related companies retained Bottomley's company's name, website and domain name, any stock on hand, and his physician distribution list. The companies continued to solicit and distribute to Bottomley's previous customers using his company's name and letter head.
Bottomley was also to remain as an advisor to Rockley Ventures, Canada Drugs and related companies following the sale of MHCS. Bottomley was paid $10,000 per month for his advisory services by the companies. In his advisor capacity, Bottomley occasionally made sales calls to physicians and dealt with shipment and payment issues. On one occasion, Bottomley traveled to Tennessee, on behalf of Canada Drugs and its related companies, to work with Volunteer Distribution on their mail-order shipping of pharmaceuticals on behalf of the companies. In January of 2012, American officials were notified by the United Kingdom Medicines and Healthcare Products Regulatory Agency (MHRA), United Kingdom, that potential counterfeit oncology drugs known as Avastin(r) (marketed in Turkey as Altuzan) had been identified and shipped to the United States. The United Kingdom wholesaler shipped 41 of the identified packs of Avastin(r) to Volunteer Distribution, a company located in Gainesboro, Tennessee. Volunteer Distribution had a pharmaceutical distribution contract with QSP, a subsidiary company of Canada Drugs. Volunteer Distribution received oncology drugs with the understanding that they would ship those drugs to clients once they were provided with a client and packing list. The packing list also included "Montana Healthcare Solutions" in the upper left-hand corner with a symbol associated with MHCS.
Lab analysis of the Avastin(r) determined the drug to be counterfeit - the substance seized and tested did not contain any of the active drug ingredient bevacizumab that is found in legitimate versions of Altuzan and Avastin(r). It was determined that Volunteer Distribution had already shipped 36 of the 41 packs of Avastin(r) to American physicians for use with patients. The 5 remaining packs of the counterfeit Avastin(r) were shipped back to the United Kingdom wholesaler.
In a separate civil proceeding handled by AUSA Victoria Francis, Bottomley agreed to forfeit to the United States $1,088,378.17 in United States currency, a 2011 Aston Martin/Vantage V-12 (which recently sold for $110,000 during a U.S. Marshal's auction) and 10 parcels of real property in Gallatin County, Montana. The property was forfeited because the government established the property was the proceeds of the illegal activity outlined in the criminal case. The total forfeiture in the matter is valued at approximately $6 million.
The defendant's conduct in this case was motivated by greed. Bottomley utilized the grey market and sold potentially dangerous unapproved and misbranded pharmaceuticals at discounted prices to American physicians all for a healthy profit. The felony prosecution and sizeable forfeiture taken in the related civil case demonstrates that when an individual allows greed to induce them into dangerous criminal activity, they will be prosecuted," U.S. Attorney for the District of Montana Michael W. Cotter.
The defendant in this case violated the law by selling grey-market, unapproved pharmaceuticals, a dangerous practice that puts at risk the health and safety of the American consumer. FDA's Office of Criminal Investigations will continue to pursue those that threaten the safety and security of the public by engaging in the distribution of counterfeit and unapproved medicines. We commend the United States Attorney's office for their commitment to supporting this prosecution," John Roth, FDA-OCI Director.
The investigation was conducted by the Food and Drug Administration, Office of Criminal Investigations.
Oxon Hill Woman Pleads Guilty in Two Separate Mortgage Fraud Schemes Resulting in Losses of over $2.5 MillionRead the Press Release
Victims Include At Least 25 Lenders, Buyers, Seller, Title Insurance
Companies and Lien Holders
Baltimore, Maryland - Rhonda Scott, age 52, of Oxon Hill, Maryland, pleaded guilty today before U.S. District Judge James K. Bredar to conspiring to commit wire fraud in connection with two separate mortgage fraud schemes which resulted in losses of over $2,500,000.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge David Beach of the United States Secret Service – Washington Field Office; Inspector General Jon T. Rymer of the Federal Deposit Insurance Corporation; Special Agent in Charge Joe Clarke of the Housing and Urban Development Office of Inspector General - Office of Investigations; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Special Agent in Charge Gene E. Morrison, Washington Field Office, U.S. Department of Justice Office of the Inspector General; Howard County Police Chief William McMahon; Acting Special Agent in Charge Lisa Quinn of the United States Secret Service – Baltimore Field Office; and Howard County State’s Attorney Dario Broccolino.
According to her plea, beginning in 2008, Scott agreed to participate in several fraudulent real estate transactions that settled at M&R Title, Inc., and Sanford Title Services LLC. The fraudulent transactions at each title company were part of different conspiracies, both of which Scott joined. In both schemes, Scott facilitated deals between her co-conspirators, identified and recruited individuals that could be parties to the real estate transactions generating proceeds for the co-conspirators, received proceeds of the fraudulent transactions through a shell company designed to disguise her receipt of the funds, sent money to co-conspirators and identified mortgage transactions that the co-conspirators could use to enrich themselves.
As part of the M&R Title conspiracy, the co-conspirators deceived buyers, sellers and lenders to make it appear to sellers that they were selling their property at a low price, and to buyers and lenders that the property was being sold at a higher price. The co-conspirators created paperwork for two different sales of the property at the same time. The first sale was fraudulent because it was backdated, the buyer was planning to immediately flip the property in a subsequent sale and the settlement statement listed a fake hard money loan. The second sale involved a significantly increased sales price and the settlement statement showed a significant sum being disbursed to the hard money lender as a payoff of an existing lien, but in reality those funds would be used for improper disbursements to the co-conspirators.
With respect to the Sanford Title conspiracy, improper disbursements were made from the title company to Scott and others. The conspirators engaged in many fraudulent techniques, including: short sales in which the property would be sold for a higher price than the seller was aware of; sales of properties not owned by the seller including properties Scott purported to own but did not own at the time of settlement; real estate transactions in which there were multiple sales of the same property at the same time; the seller and/or buyer were shown difference settlement statements and the conspirators used the difference between the figures in the two statements to enrich themselves; and Sanford Title did not disburse money that should have been paid to lien holders and instead diverted a portion of those funds to co-conspirators.
Both of the M&R Title and Sanford Title fraud schemes involved at least 25 victims, including lenders, sellers and buyers of real estate, title insurance companies and lien holders. The reasonably foreseeable loss associated with Scott’s conduct is at least $2.5 million.
Scott will be required to forfeit at least $2.7 million and pay restitution of at least $1 million.
Scott faces a maximum penalty of 30 years in prison and a $1 million fine for conspiring to commit
wire fraud. No sentencing date has been scheduled.
Emeka Udeze, age 38, of Bowie, Maryland, and Niesha Williams, age 33, of Fort Washington, Maryland, each previously pleaded guilty to their role in the fraud schemes. No sentencing date has been scheduled for them at this time.
The Maryland Mortgage Fraud Task Force was established to unify the agencies that regulate and investigate mortgage fraud and promote the early detection, identification, prevention and prosecution of mortgage fraud schemes. This case, as well as other cases brought by members of the Task Force, demonstrates the commitment of law enforcement agencies to protect consumers from fraud and promote the integrity of the credit markets. Information about mortgage fraud prosecutions is available www.justice.gov/usao/md/Mortgage-Fraud/index.html.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the U.S. Secret Service, FDIC, HUD-OIG, FBI, Department of Justice OIG, Howard County Police Department, Secret Service and Howard County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorney Harry Gruber and Special Assistant United States Attorney Colleen McGuinn assigned to this case from the Howard County State’s Attorney’s Office, who are prosecuting the case.
Owner of Charlotte Behavioral Health Company Sentenced to Two Years in Prison for $400,000 Medicaid Fraud SchemeRead the Press Release
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CHARLOTTE, N.C. – A Charlotte man and owner of a behavioral health company was sentenced on Thursday, July 11, 2013, to serve 24 months in prison for attempting to obtain nearly $400,000 in fraudulent reimbursement claims from North Carolina Medicaid, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Gregory Benny Lassiter, Jr., 32, of Charlotte, was also ordered to remain under court supervision for two years, following his prison term.
U.S. Attorney Tompkins is joined in making today’s announcement by Derrick Jackson, Special Agent in Charge, Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region and Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Division (MID).
In August 2012, Lassiter pleaded guilty to one count of conspiracy to commit health care fraud. According to court documents filed in the case, Lassiter was the owner of VisionOne Health Services, Inc., (“VisionOne”), a Charlotte-based company approved by Medicaid to provide outpatient behavioral health services to Medicaid recipients. Court documents indicate that Lassiter and VisionOne hired Dr. M.T. to provide certain review services at VisionOne, but Dr. M.T. did not see any clients while employed by VisionOne. Dr. M.T. only worked for Lassiter for a few months in 2009. According to court records and yesterday’s sentencing hearing, Lassiter misappropriated Dr. M.T.’s Medicaid provider number and submitted fraudulent claims to Medicaid, falsely stating that Dr. M.T. had provided services to clients long after Dr. M.T. had terminated her relationship with Lassiter and VisionOne. These false and fraudulent claims were submitted to Medicaid between November 2009 and April 2011 and resulted in Medicaid payments to Lassiter exceeding $191,000.
Lassiter also admitted that he submitted false claims to Medicaid for services that his company never provided. According to court records and proceedings, in October 2010, Lassiter agreed with co-conspirator Erika Holland to submit claims through VisionOne’s Medicaid provider number for services that Holland and her companies allegedly provided. Holland was not approved by Medicaid to provide mental and behavioral health services and did not employ any licensed therapists. Court documents reveal that Lassiter, nevertheless, submitted fraudulent claims to Medicaid on Holland’s behalf, claiming that VisionOne and other clinicians had provided the claimed behavioral health services. In many instances, the services were never provided at all. In exchange for submitting these false claims through his company’s Medicaid provider number, Lassiter kept 30% of the Medicaid reimbursement for the false claims. From late October 2010 to December 2010, Lassiter and Holland received approximately $93,000 from Medicaid based upon these false claims.
At the sentencing hearing, U.S. District Judge Robert J. Conrad, Jr. ordered Lassiter to pay $234,787.91 in restitution. In announcing the sentence, Judge Conrad noted that the offense involved the theft from a fund established to help the disadvantaged and was not intended to “enrich others who prey upon the system.”
Lassiter has been released on bond since entering his guilty plea in August 2012. He will be ordered to report to a federal facility, at which time he will be transferred into the custody of the Federal Bureau of Prisons. Federal sentences are served without the possibility of parole.
Co-conspirator Erika Holland was sentenced on March 2, 2012, to serve 54 months in prison for her role in the scheme, and was ordered to pay $1,585,093 in restitution.
The investigation was handled by HHS-OIG and MID. The prosecution of the case is handled by Assistant U.S. Attorney Kelli Ferry.
The investigation and charges are the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The Task Force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistle blower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The Task Force builds upon existing partnerships between the agencies and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS), or E-Mail at [email protected]. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.
Mission Woman Charged with Second Degree BurglaryRead the Press Release
United States Attorney Brendan V. Johnson announced that Monique Flood, age 19, of Mission, South Dakota, appeared before U.S. District Judge Roberto A. Lange on July 11, 2013, and pled guilty to Second Degree Burglary.
The maximum penalty upon conviction is 15 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 16, 2013, when Flood and others burglarized homes on the Rosebud Reservation and took property that did not belong to them.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case is being prosecuted by Assistant U.S. Attorney Tim Maher.
A presentence investigation was ordered and a sentencing date was set for September 30, 2013. The defendant was released from custody until August 13, 2013, when she must self-report to the custody of the U.S. Marshals Service.
# # #Mission Man Sentenced for Abusive Sexual ContactRead the Press Release
United States Attorney Brendan V. Johnson announced that a Mission, South Dakota, man convicted of Abusive Sexual Contact was sentenced on July 11, 2013, by U.S. District Judge Roberto A. Lange.
Eddie Hummingbird, age 48, was sentenced to 24 months in custody, 5 years of supervised release, $100 to the Federal Crime Victims Fund, and ordered to register as a sex offender.
Hummingbird was indicted by a federal grand jury on August 22, 2012, and pled guilty to the charge on March 4, 2013.
The conviction stems from an incident that took place on April 14, 2012, when Hummingbird sexually abused the victim.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Hummingbird was remanded to the custody of the U.S. Marshal.
# # #Man Pleads Guilty to Mail Fraud in Case Related to Conviction of Former University Medical Center Vice President Greg BruceRead the Press Release
LUBBOCK, Texas — Rodolfo Reyes Mata, aka Rudy Mata, 40, of San Antonio, Texas, appeared this morning in federal court before U.S. District Judge Sam R. Cummings and pleaded guilty to an Information charging one count of mail fraud and aiding abetting. Mata, who will remain on bond, faces a maximum statutory penalty of 20 years in federal prison, a $250,000 fine and restitution. Judge Cummings ordered a presentence investigative report with a sentencing date to be set upon the completion of that report. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
From November 2010 through September 2011, Mata submitted 15 false and fraudulent invoices to UMC for ATAM Technology Solutions, knowing that the submission of such invoices would cause UMC to pay the invoices by mailing checks to addresses listed. During the scheme, according to plea papers filed in Mata’s case, Mata and his friend, Robert Gregory Bruce, the former Vice President of University Medical Center, caused UMC to pay approximately $54,750 to ATAM Technology Solutions for goods and services that were not provided. ATAM Technology Solutions, according to the factual resume filed in the case, was in fact, an alter ego of Mata. Mata used these funds for personal living expenses, educational expenses and travel and entertainment expenses.
Bruce pleaded guilty last month to a similar offense. In documents filed in Bruce’s case, he admitted that from June 2007 to December 12, 2011, he conspired with Mata to submit false and fraudulent invoices for two companies, B.R. Media Monitoring (an alter ego of Bruce) and ATAM Technology Solutions, knowing that the submission of such invoices would cause UMC to pay the fake invoices. Over the course of the conspiracy, UMC paid approximately $681,908 on invoices for fake companies that did not provide goods or services as described in the invoices. According to plea papers filed, Bruce used these funds, in part, to pay Mata’s personal living expenses, educational expenses, and travel and entertainment expenses.
The cases are being investigated by the FBI. Assistant U.S. Attorney Amanda R. Burch is in charge of the prosecutions.
Lubbock Man Sentenced to 210 Months in Federal Prison for Producing Child PornographyRead the Press Release
LUBBOCK, Texas — Njeazeh Roderigue Ambeabet, 24, of Lubbock, Texas, was sentenced today by U.S. District Judge Sam R. Cummings to 210 months in federal prison, to be followed by 20 years of supervised release, following his guilty plea in April 2013 to one count of production of child pornography. Ambeabet has been in custody since his arrest in February 2013. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, last year, Ambeabet met an 11-year-old girl online and engaged in a texting relationship with her, frequently asking her to engage in sexual relations with him. He admitted that he was well aware of her age, and that he received sexually explicit images of her that were taken with her cell phone at his request.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about Internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
Littleton Man Sentenced to 10 Years in Prison for Possession of Child PornographyRead the Press Release
DENVER – Calvin Dawdy, age 52, of Littleton, Colorado, was sentenced yesterday by Chief U.S. District Court Judge Marcia S. Krieger to serve 10 years in federal prison for possession of child pornography, United States Attorney John Walsh and FBI Denver Special Agent in Charge Thomas Ravenelle announced. After serving his prison sentence, Chief Judge Krieger ordered Dawdy to serve 5 years on supervised release, and ordered him to pay restitution totaling $6,000 to the victims of his crime. The defendant must also register as a sex offender. Dawdy, who appeared at the hearing free on bond, was remanded into custody.
Dawdy was indicted by a federal grand jury in Denver on November 8, 2012. He pled guilty before Chief Judge Krieger on April 3, 2013. Dawdy was sentenced on July 11, 2013.
According to court documents, including the stipulated facts contained in the plea agreement, in December 2010, Dawdy knowingly possessed approximately 15,070 images and video files depicting child pornography on his laptop computer and external hard drive. Of the child pornography images and videos in Dawdy’s possession, approximately 95% depicted children under 12 years old, most of whom were girls. In February 2010 and in September 2010, Dawdy shared portions of his extensive collection of child pornography with federal agents working in undercover capacities.
As a condition of his guilty plea, Dawdy agreed to forfeit and abandon any and all of his rights, title and interest in the child pornography images, the computer and external hard drive containing child pornography, and any other real or personal property used or intended to be used to commit or promote the commission of the offenses alleged in the indictment.
“Lengthy prison sentences should send a deterrent message that possessing child pornography is a serious crime with serious consequences,” said U.S. Attorney John Walsh.
“Our nation’s children are the most vulnerable victims,” said FBI Denver Division Special Agent in Charge Thomas P. Ravenelle. “The FBI remains committed to working with our state and local law enforcement partners and the United States Attorney’s Office to aggressively investigate all cases involving the sexual exploitation of children.”
This case was investigated by the Federal Bureau of Investigation (FBI) Violent Crimes Against Children Program.
Dawdy was prosecuted by Assistant U.S. Attorney Alecia Riewerts Wolak.
This case was brought as part of Project Safe Childhood (PSC), 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, PSC 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 PSC, please visit http://www.justice.gov/psc/ For more information about Internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab "resources."
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Little Eagle Woman Sentence on Assault ChargesRead the Press Release
United States Attorney Brendan V. Johnson announced that a Little Eagle, South Dakota, woman convicted of Assault By Striking, Beating and Wounding and Simple Assault was sentenced on July 10, 2013, by U.S. Magistrate Judge William D. Gerdes.
Emily Rose Yellow Earrings, age 50, was sentenced to 10 months in custody and a $20 special assessment to the Federal Crime Victims Fund.
Yellow Earrings was indicted by a federal grand jury on November 8, 2011. On April 19, 2013, she pled guilty to a superseding information.
The conviction stems from an incident during the early morning hours of March 6, 2010, when the defendant was attending a social gathering. Also present at the gathering was the victim and the defendant's brother, who had previously been in a relationship. The defendant began an argument with the victim, became enraged, and struck the victim on top of the head. A struggle ensued and the victim was again struck by the defendant in the face.
The investigation was conducted by the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Troy Morley.
Yellow Earrings must self-report to the U.S. Marshals Service no later than July 23, 2013 to begin serving her sentence.
# # #Last Man Convicted in Attempted Armored Car RobberyRead the Press Release
HOUSTON - Terrance Saffore, 25, has entered a plea of guilty to conspiracy to interfere with commerce by robbery, United States Attorney Kenneth Magidson announced today.
Also charged in the crime are Malcolm Jamal Austin, 25, James Patrick Campbell, 26, and William Terrell Archer, 21, all of Houston. All previously entered guilty pleas and are pending sentencing.
On June 22, 2011, Austin attempted to rob a Loomis armored car service guard as the guard left a Bank of America at 12188 Gulf Freeway in Houston. He demanded money from the guard and reached for a gun. The guard then discharged his weapon and shot Austin three times. Austin also fired, but did not strike the guard.
Prior to the attempted robbery, Saffore drove Archer and Austin to the bank in a white Grand Prix which was owned by Campbell. Archer had gone inside. Once shots were fired, Archer ran back to the nearby apartment of Campbell.
After the failed robbery attempt and shooting, Austin ran to the vehicle and Saffore fled the scene with Austin.
All will be sentenced in October 2013.
Saffore and the others all face up to 20 years in prison and a possible $250,000 fine. Austin also faces an additional minimum of 10 years for discharging a firearm during the commission of a crime of violence which must be served consecutively to any other sentence imposed.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.
La Cosa Nostra Associate Sentenced to 8 Years in PrisonRead the Press Release
PHILADELPHIA – Gary Battaglini, 52, of Sewell, NJ, was sentenced today to 96 months in prison and a $1,000 fine for his participation in a racketeering conspiracy involving loan sharking and illegal gambling. In addition to the prison term, U.S. District Judge Eduardo C. Robreno ordered three years of supervised release.
On Feb. 5, 2013, after a four-month trial, a jury convicted Battaglini of conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. The evidence at trial proved that, in furtherance of the racketeering conspiracy, Battaglini, as an “associate,” engaged in loan sharking and illegal sports bookmaking activities on behalf of the mob. Battaglini exploited the violent reputation of the Philadelphia LCN Family in extending usurious loans and collecting payments on the loans, leaving the borrowers in fear of physical harm if they did not pay promptly.
The case was investigated by the FBI, the Internal Revenue Service-Criminal Investigation, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, and the U.S. Department of Labor’s Office of Inspector General Office of Labor Racketeering and Fraud Investigations, and the U.S. Department of Labor’s Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.The case was prosecuted by Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole, and Trial Attorney John S. Han of the Department of Justice’s Organized Crime and Gang Section. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Kansas City, Mo., Man Pleads Guilty to Bank RobberyRead the Press Release
KANSAS CITY, KAN. – A Kansas City, Mo., man has pleaded guilty to bank robbery in Kansas, U.S. Attorney Barry Grissom said today.
Edward Davis, 31, Kansas City, Mo., pleaded guilty to one count of bank robbery. In his plea, he admitted that on July 13, 2012, he and other accomplices robbed Bank Midwest, 3500 Rainbow Blvd., in Kansas City, Kan. Brandishing a firearm he yelled that a robbery was taking place and ordered bank customers and employees to the floor. He pointed his gun at a bank teller. After the robbery, investigators released surveillance photos of the defendant and his accomplice, resulting in information that led to Davis’ arrest.
Sentencing is set for Oct. 7. The parties have agreed to recommend a sentence of 12 years in federal prison. Grissom commended the FBI, Assistant U.S. Attorney Jabari Wamble and Special Assistant U.S. Attorney Trent Krug for their work on the case.
Jury Finds Middletown Man Guilty of Narcotics and Firearm OffensesRead the Press Release
Deirdre Daly, Acting United States Attorney for the District of Connecticut, today announced that a federal jury in Hartford has found JEFF SPRUILL, 30, of Middletown, guilty of narcotics distribution and firearm offenses. The jury returned the verdict today following a two-day trial before United States District Judge Robert N. Chatigny.
According to the evidence at trial, on June 12, 2012, officers from the Middletown Police Department conducted a controlled purchase of cocaine from SPRUILL. On August 14, 2012, officers made a controlled purchase of crack cocaine from SPRUILL.
SPRUILL was arrested on August 28, 2012, after a search of his person revealed quantities of marijuana and cocaine. A subsequent search of a residence connected to SPRUILL revealed a loaded Hi-Point .40 caliber semi-automatic handgun, a loaded Hi-Point .380 caliber semi-automatic handgun and a loaded Smith & Wesson .357 Magnum revolver.
Prior to August 2012, SPRUILL had been convicted of multiple felony offenses in Connecticut, including criminal possession of a weapon and sale of hallucinogens/narcotics. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
The jury found SPRUILL guilty of one count of distribution of cocaine, one count of distribution of cocaine base (“crack cocaine”), and one count of possession with intent to distribute cocaine. Each of these charges carries a maximum term of imprisonment of 20 years. The jury also found SPRUILL guilty of one count of possession of firearms by a previously convicted felon, which carries a maximum term of imprisonment of 10 years.
Judge Chatigny has scheduled sentencing for October 10, 2013.
This case was investigated by the Middletown Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case is bein gprosecuted by Special Assistant United States Attorney Natasha M. Dye and Assistant United States Attorney Michael Gustafson.
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(203) 821-3722 [email protected]Jury Convicts Canal Winchester Man of Filing False Income Tax ReturnRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS, OHIO – A U.S. District Court jury here has convicted William David Taylor, Sr., 50, of Canal Winchester, Ohio of two counts of filing false federal income tax returns with the Internal Revenue Service (IRS).
Carter M. Stewart, United States Attorney for the Southern District of Ohio and Kathy A. Enstrom, Acting Special Agent in Charge, Internal Revenue Service Criminal Investigation, Cincinnati Field Office announced the verdict returned July 10 following a trial that began July 1 before U.S. District Judge Algenon L. Marbley.
Testimony presented during the trial showed that Taylor filed false federal income tax returns with the IRS for 2006 and 2007. The 2006 income tax return showed total income in the amount of $51,967, and the 2007 income tax return showed total income in the amount of $33,272. Evidence showed that the total income Taylor earned in 2006 and 2007 substantially exceeded the amounts he claimed.
During 2006 and 2007 Taylor operated a construction consulting business. An important part of his business involved convincing landowners to engage him in development projects that would involve both investors as well as individuals who would purchase plots and receive construction loans to build houses. Taylor served as the general contractor and, as such, established business bank accounts that he controlled in order to develop the properties and build the houses.
Additionally, Taylor contracted with others who wished to retain him to build individual homes separate from the development projects. Evidence presented during the trial showed that funds from those investors and other persons flowed into Taylor’s construction consulting business accounts and were frequently spent on personal items and activities such as vacations, private schools for Taylor’s children and significant renovations to his home. Taylor did not complete any of the projects or houses, and failed to pay the money back to the investors and those persons who had trusted him to follow through on their home-building plans. An IRS representative calculated that Taylor had failed to report on his federal income tax returns approximately $110,000 in income for 2006 and $189,000 for 2007.
Funds received and used personally as income must be reported as income on the tax returns of the recipients of that money. Filing a false federal income tax return with the IRS is punishable by up to three years in prison and a fine of up to $250,000. Judge Marbley will schedule a date for sentencing.
Stewart commended the investigation conducted by IRS Criminal Investigation, as well as Assistant U.S. Attorney Daniel Brown, who is representing the United States in the case.
###Joshua Alan Blythe Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on July 12, 2013, before U.S. District Judge Dana L. Christensen, JOSHUA ALAN BLYTHE, a 27-year-old resident of Butte, was sentenced to a term of:
Prison: 50 months
Special Assessment: $100
Supervised Release: 3 years
BLYTHE was sentenced in connection with his guilty plea to conspiracy to distribute controlled substances.
In an Offer of Proof filed by Assistant U.S. Attorney Timothy J. Racicot, the government stated it would have proved at trial the following:
In early August 2011, law enforcement officers in Butte received information about a large quantity of prescription medication located at a local residence. The landlords of the residence evicted the tenants, including BLYTHE, and later found a white, five-gallon bucket and a small lunch cooler that were filled with various pills, and a metal box containing smaller boxes with a white, powdery substance.
The bucket of pills had "Stericycle," a bar code, and an SKU number on it. Stericycle is a medical waste disposal company in Butte. An investigating officer interviewed the manager of Stericycle, who said he was not aware of that particular bucket. The manager also confirmed that BLYTHE had been employed by Stericycle in the past, but had been terminated.
On August 16, 2011, agents interviewed BLYTHE about the bucket of pills found at his former residence. BLYTHE reported receiving the bucket from Wayne Partin and buying drugs from Partin for approximately three years, including oxycontin, hydrocodone, morphine, and methamphetamine. BLYTHE said that Partin had stolen the drugs from Stericycle and he described helping Partin move several containers of prescription pills from one residence to another in approximately July 2011. BLYTHE did not admit to helping Partin sell any of the pills in and around Butte.
Later on August 16, 2011, officers from Probation and Parole in Silver Bow County, along with the case agents, conducted a probation search of Partin's residence in Butte. During the search, officers seized a significant quantity of pills (controlled and non-controlled substances), Stericycle storage containers, sharps containers, needles, forceps, other medical waste, handwritten notes that appear to describe and identify pills, books used to identify pills, and a Hewlett-Packard Pavilion a6000 computer. A forensic examiner analyzed the computer and determined that between January 2010 and August 2011, Partin used the computer to conduct searches aimed at identifying various pills and prescription medication.
Law enforcement officers conducted several additional interviews after searching Partin's residence and at least two people told investigators that BLYTHE was helping Partin sell some of the pills that Partin had stolen from Stericycle.
Partin pled guilty to federal charges and has been sentenced.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that BLYTHE will likely serve all of the time imposed by the court. In the federal system, BLYTHE does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was a cooperative effort between the U.S. Department of Homeland Security - Homeland Security Investigations and the Butte-Silver Bow Law Enforcement Agency.
John Todd Scott Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on July 10, 2013, before Senior U.S. District Judge Wm. Fremming Nielsen, JOHN TODD SCOTT, a 29-year-old resident of Billings, was sentenced to a term of:
Prison: 60 months
Special Assessment: $100
Forfeiture: computer equipment
Supervised Release: 10 years
SCOTT was sentenced in connection with his guilty plea to receipt of child pornography.
In an Offer of Proof filed by Assistant U.S. Attorney Lori H. Suek, the government stated it would have proved at trial the following:
Law enforcement officers were investigating allegations of child pornography access by users utilizing the peer-to-peer file sharing network. One investigation involved a person in Billings who had child pornography available to share via a file sharing program. An undercover agent downloaded a number of child pornography files from that person on various occasions in 2011 and into 2012. A search warrant was obtained for the residence and served on September 6, 2012.
SCOTT was one of the occupants of the residence. When questioned, SCOTT admitted that he used the peer-to-peer file sharing programs to receive and possess thousands of child pornography videos and images. He detailed the search terms he used to find child pornography, how he saved it to various computers and other equipment, and how he had been doing so for a lengthy period of time.
Agents seized various computer equipment at SCOTT's residence. Subsequent forensic examination revealed thousands of images and movies of child pornography that SCOTT had received via the Internet for several years and continuing until the equipment was seized. SCOTT possessed images and movies of children clearly prepubescent and children engaged in sadistic or masochistic abuse or other depictions of violence.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that SCOTT will likely serve all of the time imposed by the court. In the federal system, SCOTT does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Federal Bureau of Investigation.
James Arthur Reynolds Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on July 10, 2013, before Senior District Court Judge Wm. Fremming Nielsen, JAMES ARTHUR REYNOLDS, a 55-year-old resident of Roundup, was sentenced to a term of:
Prison: 37 months
Special Assessment: $200
Supervised Release: 3 years
REYNOLDS was sentenced in connection with his guilty plea to being a felon-in-possession of a firearm.
In an Offer of Proof filed by Assistant U.S. Attorney Lori Harper Suek, the government stated it would have proved at trial the following:
REYNOLDS had a felony conviction in 1985 in Virginia and multiple convictions from 1987 forward in Montana, therefore prohibiting him from possessing firearms.
On July 14, 2012, at 4:18 a.m., law enforcement received a report of a man sleeping in the ditch next to a motorcycle on a highway near Billings. Responding officers found REYNOLDS asleep and woke him. REYNOLDS reported that he had been driving home and became sleepy. In running his record, they found that REYNOLDS had a felony warrant for revocation on original charges of burglary and felony theft out of Beaverhead County and arrested him. Found on his person was a handgun magazine loaded with .45 caliber ammunition and a baggie of marijuana. REYNOLDS claimed he found the magazine lying on the ground in Billings, and that he did not have a firearm.
When questioned on July 18, 2012, REYNOLDS claimed that he found the .45 caliber handgun magazine on a table top while at a bar in Billings. He admitted that he was not to be in possession of firearms or ammunition given his felony record, but had friends who own .45 caliber guns and was planning to give it to one of them.
REYNOLDS then admitted that in fact he did own a .45 caliber handgun. REYNOLDS told how he was a "prospect" for the ".45s Motorcycle Club" in Roundup and in order to be a "prospect" and later a "fully-patched member," one had to own a .45 caliber gun. Because REYNOLDS could neither buy nor possess the .45, he had his friend, a "fully patched" member of the .45s Club, purchase the gun for him and he keeps it behind the bar at the "Clubhouse" in Roundup. REYNOLDS reported that his friend had purchased the gun for him approximately a month to six weeks before. REYNOLDS also admitted that he had both handled and shot the firearm, a Hi Point/Haskell Manufacturing, Model JHP, .45 caliber, semi-automatic pistol.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that REYNOLDS will likely serve all of the time imposed by the court. In the federal system, REYNOLDS does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Jacksonville Man Sentenced for Drug Distribution and Firearms ViolationRead the Press Release
GREENVILLE - United States Attorney Thomas G. Walker announced that in federal court yesterday, Senior United States District Judge Malcolm J. Howard sentenced CORNELL ALLEN MELVIN, 28, to 200 months imprisonment, followed by a term of 6 years supervised release, a $5,000 fine and $200 special assessment. MELVIN received an enhanced sentence due to his criminal record and status as a career offender.
A Federal Grand Jury returned a nine-count Criminal Indictment on January 3, 2013. On April 9, 2013, MELVIN pled guilty to Distribution of a Quantity of Cocaine Base (Crack), in violation of Title 21, United States Code, Section 841(a)(1), and Possession of a Firearm by a Felon, in violation of Title 18, United States Code, Section 922(g)(1) and 924(a)(2).
According to the investigation, MELVIN engaged in drug trafficking and firearms violations in the Jacksonville area from at least March 2012 to June 2012. On six occasions, MELVIN sold cocaine base (crack) to a confidential informant operating under the direction of law enforcement. MELVIN also sold the confidential informant two firearms, one with an obliterated serial number. MELVIN had previously been convicted of numerous felony crimes and was prohibited from possessing a firearm.
This case was part of the Project Safe Neighborhoods initiative, which encourages federal, state, and local agencies to cooperate in a unified “team effort” against gun crime, targeting repeat offenders who continually plague their communities.
Investigation of this case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and by the Jacksonville Police Department. Assistant United States Attorney Toby Lathan represented the government.
Jackson County Man Charged with Methamphetamine ConspiracyRead the Press Release
A Murphysboro, IL, resident was indicted on July 9, 2013, in an indictment, charging conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Larry J. Dowdy, Jr., 35, is charged with conspiracy to manufacture methamphetamine. The indictment alleges that the offense occurred between 2012 and March 2013 in Jackson County. Dowdy is scheduled to make his initial appearance in United States District Court in Benton on July 19, 2013.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
If convicted, Dowdy faces a term of imprisonment of up to 20 years, a $1,000,000 fine, and 3 years of supervised release.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, and Drug Enforcement Administration. The Carbondale Police Department also assisted in the investigation.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Jackson County Man Charged with Methamphetamine ConspiracyRead the Press Release
A Murphysboro, IL, resident was indicted on July 9, 2013, in an indictment, charging conspiracy to manufacture methamphetamine, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
On July 11, 2013, Michael R. Jines, a/k/a “Mikey” and “Pill Mike,” 32, was arraigned in United States District Court in Benton on an indictment charging conspiracy to manufacture methamphetamine. The indictment alleges that the offense occurred between January 2013 and June 2013 in Jackson County. Jines is currently being held without bond pending a July 16, 2013, detention hearing.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
If convicted, Jines faces a term of imprisonment of up to 20 years, a $1,000,000 fine, and 3 years of supervised release.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Murphysboro Police Department, and Drug Enforcement Administration.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Houston Man Detained on Child Pornography ChargesRead the Press Release
HOUSTON – Roger Dean Matice, 71, of Houston, has been ordered into custody on charges of possession and distribution of child pornography, United States Attorney Kenneth Magidson announced today.
Matice was indicted on June 19, 2013. Today, U.S. Magistrate Judge George C. Hanks Jr. ordered him detained pending further criminal proceedings.
The investigation revealed Matice was allegedly making child pornography available to others through the use of peer-to-peer software over the Internet. A task force officer chatted with Matice online and allegedly received images of child pornography from him during those interactions. The chats and downloads were traced to both Matice’s place of business and his home, according to the allegations.
Search warrants were issued for both locations, at which time computers were seized and analyzed. According to court records, more than 22,500 images and 470 videos containing child pornography were found. These images allegedly included children under 12 being sexually violated by adults, children under 12 in positions which caused their genitalia to be displayed in a lewd/lascivious manner, as well as children being penetrated by a foreign object.
Matice faces a minimum of five and up to 20 years imprisonment for distribution of child pornography as well as a maximum of 10 years in prison for possession of child pornography. Both charges also faces a possible $250,000 fine, upon conviction.
The charge was the result of an investigation conducted by the FBI Innocent Images Task Force which includes members of the Harris County Sheriff’s Office.
This case, prosecuted by Assistant United States Attorney Sherri L. Zack, was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Houston Man Convicted of Lying and Buying FirearmsRead the Press Release
HOUSTON – Kenny Davalos, 24, of Houston, has entered a plea of guilty to conspiracy to make and making a false statement to a federal firearms licensee (FFL), United States Attorney Kenneth Magidson announced today.
Davalos was arrested along with three others in May 2013. Charles Smith, 27, Ashley Phlegm, 26, and Dyneisha Jackson, 28, all of Houston, have all also pleaded guilty and are pending sentencing.
The investigation into the conspiracy was initiated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in November 2012. During the course of the investigation, ATF learned Davalos had originally contacted Smith about buying guns for him to send to Mexico, but Smith refused due to his status as a convicted felon. However, Smith put Davalos in contact with Jackson (Smith’s sister) and Phlegm (Smith’s fiancée), whom Davalos paid $200 each to purchase a total of seven firearms for him to send to Mexico.
In late October 2012, a GP WASR-10 7.62x39mm rifle was discovered during a raid on members of a drug trafficking organization in Monterrey, Nuevo Leon, Mexico. ATF agents traced the weapon to Jackson who purchased it on Sept. 28, 2012, from Collectors Firearms, an FFL in Houston. Jackson also admitted to purchasing a DPMS A-15 rifle from the same FFL in August 2012 and a Beretta Model: 92FS pistol in September 2012 from Carters Country in Houston.
Phlegm and Smith admitted to purchasing a total of four guns for Davalos - a Bushmaster Carbon 15 rifle, two Romarm GP WASR-10/6 rifles and a FN Fabrique National pistol.
Agents intercepted Jackson buying a Romarm Model WASR 10/63 semi-automatic rifle and delivering it to Davalos. Upon his arrest, agents found five rounds of .223 live ammunition, 20 rounds of 7.62x39 Tulammo live ammunition and one empty Glock box for a .40 caliber Glock Model 22 along with $1,340 in cash and a Mexican identification card.
Davalos will remain in custody pending sentencing, which has been set for Oct. 3, 2013, at 2:00 p.m.
Assistant U.S. Attorney Megan J. Paulson is prosecuting this case.
Houston Man and His Father Head to Prison for Debt Relief ScamRead the Press Release
HOUSTON - Nathaniel Chilo, aka Nathaniel O’Neil, 23 of Houston, has been sentenced to prison for his role in perpetuating a debt relief scam with his father, United States Attorney Kenneth Magidson announced today. Chilo pleaded guilty Sept. 21, 2012, admitting that between September 2009 and September 2010, he assisted his father, Jeffery Wayne O’Neil, 55, of Houston, in promoting a number of debt relief/elimination schemes to individuals throughout the United States.
Today, U.S. District Judge Ewing Werlein Jr., who accepted the guilty plea, handed Chilo and O’Neil respective sentences of 70 and 78 months. Chilo was ordered to pay restitution in the amount of $130,176.09, while his father will pay $661,980.95. Both will serve three years of supervised release following completion of their sentences. In handing down the sentence, Judge Werlein noted the plight of the victims, hard pressed by bankruptcy, credit card debt and out of jobs thinking that O’Neil was going to help them.
O’Neil admitted that between June 2005 and Sept. 7, 2010, he promoted a number of debt relief/elimination schemes to individuals throughout the United States. He operated various debt relief businesses in the Houston area under different names including, but not limited to, J. O’Neil/Associates Inc., World Outlook, World Outlook Management (WOM) and Universal Restoration, none of which were licensed by the Texas Office of Consumer Credit Commissioner, according to court documents.
O’Neil made numerous false representations to his “clients” and used a program called the “Debt Reconciliation Program” or “Debt Relief Program,” referred to as “DRP,” charging each client a percentage of debt as a fee for participating in the DRP. The basis of the DRP was that once a creditor cashed a check with an attached novation agreement from WOM, one of O’Neil’s businesses, the creditor was then allegedly agreeing to accept that novation agreement and look to only WOM for payment of the debt.
O’Neil admitted that in June 2009, he caused two individuals to send a cashier’s check to WOM by Federal Express to pay for their participation in the DRP and to also sign assignments of debt, assigning a credit card debt to WOM. He further caused one of these individuals to sign a novation agreement for that debt. O’Neil admitted that he fraudulently led these individuals to believe that by their signing the assignment of debt, execution of the novation agreement and their payment to WOM to participate in O’Neil’s DRP program their debt would be eliminated when it did not.
At the time of conviction in this case, Chilo admitted he knowingly made false representations to individuals seeking debt relief through various programs offered by Jeffery O’Neil. He further admitted that on Feb. 4, 2010, he filed an assumed name for a business by the name of Universal Restoration in Ft. Bend County which would allegedly provide relief from various types of debt. Chilo admitted he caused an individual on or about July 12, 2010, to wire transfer $5600 from that person’s bank account in Arizona to the bank account for Universal Restoration in Houston. The transfer was made as a result of Chilo’s representation that he had negotiated a settlement of a debt owed by that person to Navy Federal Credit Union. According to Chilo’s representation, this person was to pay 40% of the settlement amount and Universal Restoration would pay the remaining 60%. Chilo admitted he paid no money to Navy Federal Credit Union on that person’s behalf to settle the debt. Finally, Chilo admitted that the settlement offer he made was fraudulent and that Navy Federal Credit Union never authorized the settlement.
Chilo will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. O’Neil was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
The case was investigated by the United States Secret Service and is being prosecuted by Assistant United States Attorney John Braddock.
Hilda Sue Lewis Towe Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on July 11, 2013, before U.S. District Judge Dana L. Christensen, HILDA SUE LEWIS TOWE, a 35-year-old resident of Hamilton, was sentenced to a term of:
Probation: 5 years
Special Assessment: $200
Restitution: $32,181.01
TOWE was sentenced in connection with her guilty plea to theft of federal government money and making false statements.
In an Offer of Proof filed by Assistant U.S. Attorney Laura B. Weiss, the government stated it would have proved at trial the following:
Between March 2009 until approximately January 2012, TOWE received $21,868.01 in Supplemental Security Income (SSI) to which she was not entitled.
TOWE made false statements in a written document by misrepresenting the composition of her household, employment status, and the amount of income received to support the household. She did so deliberately with the knowledge the statements were untrue.
In a June 2012 interview, she admitted she knew her legal reporting requirements for SSI and for serving as a representative payee. She admitted to purposely concealing material facts such as living arrangements and income. She stated that she knew if she accurately reported the status of those items it would effect her SSI eligibility. Finally, she stated that she purposely concealed facts from the Social Security Administration in order to continue receiving payments.
The investigation was conducted by the Social Security Administration - Office of Inspector General.
Hardin County, Kentucky Man Guilty of Impersonating A Soldier for Financial GainRead the Press Release
LOUISVILLE, Ky. – A Hardin County, Kentucky, man pleaded guilty in United States District Court today, before District Judge John G. Heyburn II, to charges of pretending to be an officer of the United States, wire fraud, making false statements or representations, and entering government property under false pretenses for the purposes of committing a felony, announced David J. Hale, United States Attorney for the Western District of Kentucky.
Jonathan Wade Short, age 23, despite being a civilian with absolutely no record of service in the armed forces of the United States, admitted to falsely impersonating a United States soldier for a period between March 8, 2012, until December 7, 2012.
Further, during August 2012, Short admitted in court to meeting A.V., the daughter of a retired member of the armed forces, on a social networking site where he falsely claimed to be a highly decorated soldier, who had been on multiple deployments, and received high military honors (including the Purple Heart). Approximately one month later, when the two met for the first time in person, Short, dressed in a complete Army Combat Uniform (ACU) wearing the rank of Sergeant, a Combat Infantryman Badge, and Parachutists Badge, Combat Patch, and a Ranger tab. While dating A.V. in Daviess and Hardin Counties and elsewhere, Short, who was accompanied by A.V., repeatedly demanded and obtained financial benefits and discounts only entitled to current and former members of the armed forces of the United States. Short possessed at least seven Army Dress Uniforms, with accompanying ribbons, badges, and medals, and wore them in public and on social networking sites as part of his continuous effort to impersonate a decorated combat veteran.
Between October 6, 2012, and approximately November 16, 2012, in Hardin County, defendant Short, did repeatedly ask A.V. to send him money under the false premise that he needed money to help defray the expenses related to his son’s emergency medical treatment at Kosair Children’s Hospital in Louisville, Kentucky. Short actually had no son who was ill or hospitalized. In fact, he demanded the money from A.V. in order to exploit A.V.’s belief he was a noble soldier in a desperate family and financial situation. During the two month period, A.V. gave Short nearly $1,000.
On or about December 7, 2012, Short admitted to A.V. he was not a Soldier and that he solicited money from her based upon false pretenses. Moreover, he refused to return the solicited funds upon A.V.’s request. Further, on or about October 11, 2012, at Fort Knox, Kentucky, in the exclusive territorial jurisdiction of the United States, Short was apprehended once Military Police at Fort Knox for attempting to impersonate a Soldier. Once an investigation revealed the extent of his fraud, he was apprehended and detained by the Federal Bureau of Investigation near Springfield, IL. If convicted at trial, Short faced a possible combined maximum term of 23 years in prison, a combined maximum fine of $500,000 and a ten year term of supervised release. Sentencing is scheduled for September 15, 2013, at 1:00 pm, in Louisville, before Judge Heyburn.
This case is being prosecuted by Special Assistant United States Attorney Milton A. Turner and was investigated by the Federal Bureau of Investigation.
Former Charlotte Attorney Pleads Guilty Mid-Trial to Mortgage Fraud Related ChargesRead the Press Release
Lawyer Was Among 91 Defendants Charged in Operation Wax House
CHARLOTTE, N.C. – A former Charlotte lawyer pleaded guilty mid-trial on Wednesday, July 10, 2013, to mortgage fraud related charges, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. The former lawyer’s plea of guilty is the latest conviction in Operation Wax House, a mortgage fraud investigation which began in 2007 and has netted 91 defendants to date, 72 of which have pleaded guilty.
Michelle V. Mallard, 46, of Charlotte, pleaded guilty to mortgage fraud conspiracy, money laundering conspiracy and embezzlement in violation of the wire fraud statute.
U.S. Attorney Tompkins is joined in making today’s announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation (IRS-CI).
Mallard’s federal criminal trial began on Monday, July 8, 2013, before Chief U.S. District Judge Frank D. Whitney. Mallard, a/k/a Michelle Crawford, was charged with embezzlement and with serving as a mortgage fraud lawyer for a mortgage fraud cell in the Operation Wax House investigation. According to evidence introduced at trial, Mallard agreed to use her law license to further mortgage fraud primarily in South Charlotte and Waxhaw, N.C. According to trial testimony, the co-conspirators purchased houses at inflated prices in exchange for large kickbacks representing the difference between the true price and the inflated price. Trial witnesses testified that Mallard agreed to pay such kickbacks to other members of the conspiracy and, among other things, accepted bogus checks to make it appear as though buyers had provided money when they had not. According to trial evidence and statements made by the prosecutors, Mallard participated in the mortgage fraud after having stolen over $30,000 from clients by embezzling from her trust account.
Following the presentation of evidence by the government on Monday and Tuesday, Mallard announced to Judge Whitney on Wednesday that she wished to change her plea from “not guilty” to “guilty” on all the counts she was charged with in a second superseding indictment returned by a Charlotte grand jury in September 2012. The remaining five defendants charged in that indictment have already pleaded guilty and are included in the list of defendants below.
Following her guilty plea, Mallard was released on bond pending the scheduling of her sentencing hearing. At sentencing, Mallard faces a maximum prison term of 70 years. In determining Mallard’s actual sentence, the Court will consider the U.S. Sentencing Guidelines, which are not binding but provide advisory sentencing ranges. A sentencing date for the defendant has not been set yet.
Operation Wax House in the Western District of North Carolina is being handled by the Charlotte Division of the FBI and the Criminal Division of the IRS for the Financial Fraud Enforcement Task Force, along with the Securities Division of the North Carolina Secretary of State with respect to a separate prosecution. The Mallard prosecution for the government was being handled by Assistant United States Attorneys Kurt W. Meyers and Maria K. Vento.
Today’s announcement is part of an effort by President Obama’s Financial Fraud Enforcement Task Force (FFETF), created in November 2009, to combat financial fraud crimes by waging aggressive, coordinated and proactive investigations and prosecutions. With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, the task force is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
The names and case numbers of the all the defendants charged to date in Operation Wax House are listed below, organized by their alleged role in the scheme.
Attorneys and Paralegals
Crawford/Mallard, Michelle 3:11cr374
Gates, Christine 3:09cr100
Norwood, Kelli, 3:09cr162
Rainer, Demetrius 3:08cr239/241
Smith, Troy, 3:08cr264Bank Insiders
Brown, Jamilia, 3:10cr124
Eason, Danyelle, 3:10cr116
Henson, Vic. F., 3:10cr124
Jackson, Mitzi, 3:11cr374
Ramey, Bonnie Sue, 3:10cr124Builders and Sellers
Fink, James, 3:11cr374; 3:12cr239
Jackson, Jennifer, 3:09cr241
Smith, Kelvis, 3:12cr238
Viegas, Jeffrey, 3:12cr298
Wittig, Mark, 3:12cr335
Wood, Gary, 3:09cr208Facilitators and Financiers
Hickey, Denis, 3:09cr103
McClain, Landrick, 3:10cr124
Mitchell, Ann Tyson, 3:12cr239
Panayoton, Sherrill, 3:11cr176
Taylor, Alicia Renee, 3:10cr124
Wilson, Willard, 3:09cr161Buyers
Banks, Arketa, 3:12cr297
Clark, Benjamin, 3:12cr239
Hillian, Kirk, 3:12cr83
Mathis, Charles, 3:10cr1
Mobley, Sarena, 3:10cr124
Moore, George, 3:12cr337
Richards, Dan, 3:10cr119
Smith, Kevin, 3:12cr341
Tyler, Glenna, 3:11cr200
Vaughn, Mary, 3:12cr329
Wallace, Jamaine, 3:12cr330
Wellington, William, 3:12cr333Notary Public
Willis, Anthony, 3:09cr218Appraiser
Darden, Clinton 3:10cr108Mortgage Brokers
Bradley, Bonnette, 3:12cr299
Clarke, Linda, 3:10cr120
Flood, Ericka, 3:10cr124
Goodson-Hudson, Crystal, 3:12cr339
Mahaney, Robert, 3:12cr34-0
Scagliarini, Coley, 3:11cr374
Staton, Walter, 3:10cr113
Vaughn, Danielle, 3:12cr329
Williams, Marcia, 3:12cr334
Williams, Sean, 3:12cr336
Woods, Joseph, 3:09cr178Real Estate Agents
Belin, Chris, 3:11cr374
Clark, Christina, 3:09cr44
Lee, Shannon, 3:12cr338
Pasut, Holly Hardy, 3:12cr331
Wolf, Nathan Shane, 3:12cr239
Wood, Gary, 3:09cr208Promoters
Amini, Ramin, 3:12cr239
Barnes, Vonetta Tyson, 3:12cr239
Brown, William, 3:12cr239
Bumpers, Travis, 3:12cr239
Carr, Stephen, 3:10cr124
Clarke, Benjamin, 3:12cr239
Clarke, Reuben, 3:10cr120
Coleman, Gregory, 3:10cr118
DeSimone, Frank, 3:12cr239
Dooley, Lorie, 3:12cr239
Hitchcock, Jimmy, 3:11cr374
Hubbard, Glynn, 3:12cr239
Hunt, Victoria, 3:12cr239
Hunter, Toby, 3:12cr239
Johnson, Ralph, 3:12cr239
Jones, Steven, 3:12cr239
Jones, Tyree, 3:10cr230
Long Waylon, 3:12cr239
Marshall, Michael, 3:07cr283
McDowell, John, 3:12cr239
McPhaul, Elizabeth, 3:10cr114
Mehr, Kurosh, 3:12cr239
Mitchell, Ann Tyson, 3:12cr239
Moye, Melvin, 3:12cr239
Myles, Denetria, 3:12cr239
Newland, Matthew, 3:12cr239
Perry, John Wayne, Jr., 3:12cr239
Perry, Kim, 3:10cr25
Phillips, Rick, 3:10cr115
Saddig, Nazeere, 3:12cr239
Sharreff-El, Drew, 3:10cr124
Sherald, Kiki, 3:10cr117
Simmons, Aaron, 3:09cr240
Snead, Todd, 3:10cr124
Staton, Lisa, 3:10cr113
Thorogood, Donte, 3:12cr239
Tyson, Carrie, 3:12cr239
Tyson, James, Jr. 3:12cr239
Tyson, James, Sr., 3:12cr239
Wellington, Phillip, 3:12cr332
Wood, Purnell, 3:12cr239Former Big Spring, Texas, Man Sentenced to 15 Years in Federal Prison on Child Pornography ConvictionRead the Press Release
LUBBOCK, Texas — Christopher Aubrey Harlan, 27, formerly of Big Spring, Texas, was sentenced today by U.S. District Judge Sam R. Cummings to 15 years in federal prison, to be followed by eight years of supervised release, following his guilty plea in March 2013 to one count of receiving child pornography. Judge Cummings ordered that Harlan surrender to the Bureau of Prisons on August 16, 2013. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, Harlan used his computer, as well as for a brief time, his roommate’s computer, to access child pornography on various websites. He used those computers, as well as his cellphone, to send and receive numerous images of child pornography.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The investigation was conducted by U.S. Immigrations and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Big Spring Police Department. Assistant U.S. Attorney Steven M. Sucsy prosecuted.
Former Arkansas Scholarship Lottery Deputy Director Pleads Guilty to Wire Fraud and Money LaunderingRead the Press Release
Little Rock - Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas, and Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation Nashville Field Office announced today that, in a hearing held before U.S. District Judge Susan Webber Wright, Remmele Mazyck, 34, of Bryant, Arkansas, pled guilty to one count of wire fraud and one count of money laundering. The charges relate to a scheme to defraud the Arkansas Scholarship Lottery.
As deputy director of security for the Arkansas Scholarship Lottery, Mazyck had access to packages of promotional lottery tickets, which the lottery routinely gave away at large-scale events such as festivals, fairs, and retailer rallies. Beginning in or about December 2009 through October 2012, Mazyck took lottery tickets from the Arkansas Scholarship Lottery vendor’s warehouse for his personal use. He would assign the tickets to retailers no longer selling tickets, and then use his position as deputy director of security to log into the Arkansas Scholarship Lottery’s software program to change the tickets from “Available-Virgin” to “Promotional.” This change activated the tickets and allowed Mazyck to cash any winning tickets. To hide the scheme, Mazyck would then log into the software and change the status of all the losing tickets to “Voided by Security”. In total, Mazyck received approximately $477,893.00 from the scheme.
“In attempting to beat the odds for winning in the Arkansas Scholarship Lottery, Mazyck stole funds that could have gone to another future student,” stated Thyer. “Odds are, when you choose to use illegal means to increase your winnings, you will lose.”
“Public officials, whether elected or appointed, hold positions of trust in the eyes of the public. That trust is broken when these officials commit crimes. No public official gets a free pass,” stated Christopher A. Henry, Special Agent in Charge of the IRS-Criminal Investigation Nashville Field Office. “The IRS enforces the nation's tax laws, but also takes particular interest in cases where someone, for their own personal benefit, has taken what belonged to others. With both law enforcement and financial investigation expertise, our agents are uniquely qualified to assist state and federal law enforcement agencies with these types of cases by following the money. We are pleased with the successful resolution of this investigation due to the cooperative efforts of our law enforcement partners."
Mazyck faces a maximum penalty of 20 years in prison and a fine of $250,000.00 when he is sentenced. The sentencing date will be set by the Court at a later date.
This investigation was conducted by IRS-Criminal Investigation and the Arkansas State Police. The case is being prosecuted by Assistant United States Attorneys Jana Harris and Cameron McCree .
An indictment contains only allegations. The defendant is presumed innocent unless and until proven guilty.
Florida Man Convicted of Selling Stolen Art and Evading the Payment of Federal Income Taxes Sentenced to 7½ Years in PrisonRead the Press Release
LOS ANGELES – A Florida man who sold paintings stolen from a Los Angeles art gallery – and who took elaborate steps to avoid paying taxes over several years – has been sentenced to 90 months in federal prison for the art-related and tax offenses.
Matthew Taylor, 45, of Vero Beach, Florida, was sentenced yesterday afternoon by United States District Judge John A. Kronstadt.
In addition to the prison term, Judge Kronstadt ordered Taylor to pay $1,244,190 in restitution – $106,152 to two art galleries, and $1,138,038 to the Internal Revenue Service for back taxes, penalties and interest. The judge also ordered that during the period of supervised release following his prison term, Taylor may not work in or own “any business involving antiques and or art” without the approval of a probation officer.
Taylor was found guilty by a federal jury in August 2012 of five separate federal felonies, including wire fraud, possession of stolen property which had crossed state lines, and two counts of tax evasion for the years 2005 and 2006. The jury also convicted Taylor of structuring cash transactions to avoid federal reporting requirements by making $226,000 in cash withdrawals in smaller amounts so as to avoid possible seizure of the funds by authorities – and found that he committed the structuring offense while free on bond in the art fraud case.
The evidence presented at trial showed that Taylor stole several paintings from the Los Angeles Fine Art Gallery, including a Granville Redmond painting called “Seascape at Twilight” and an untitled painting by Lucien Frank. Taylor later sold the Redmond painting to a different gallery for $85,000, falsely claiming that his mother had owned it for several years. Taylor took the Frank painting to Florida, erased Frank’s signature from the artwork, and then attempted to sell the painting to an art collector, claiming it was by a different artist.
The evidence presented at trial also showed that Taylor took elaborate steps to evade paying more than $400,000 in federal income taxes owed for 2005 and 2006, including creating bogus companies with names similar to well known companies (like Microsoft), using false social security numbers to hide his bank accounts, and using post office boxes to open other post office boxes to use as mail drops. Taylor also moved money to an off-shore bank account in the Bahamas as part of his attempts to evade the payment of taxes. Taylor falsely claimed that his mother had controlled all of his bank accounts and LLCs, and that he had relied on her to file tax returns for him – even though she was in failing health and suffering from dementia.
Taylor’s “repeated attempts to blame his mother for his crimes are demonstrative of his history and characteristics,” prosecutors wrote in a sentencing memo filed with the court. “In short, defendant has demonstrated that he is a con man, a thief, a tax-cheat, and a liar, who has no compunctions about using others (such as his girlfriend) and blaming others (such as his mother or his pretrial officer) if it is to his advantage. He has steadfastly refused to accept responsibility for his crimes, and has repeatedly acknowledged that he moved money around to avoid seizure by the IRS.”
The investigation into Taylor was conducted by the FBI’s Art Crime Team, the Los Angeles Police Department’s Art Theft Detail, and IRS Criminal Investigation.
Release No. 13-095a
Federally-Sponsored Statewide Rapid Response Training to Be Held in Grand RapidsRead the Press Release
GRAND RAPIDS, MICHIGAN – The U.S. Attorney’s Offices for the Eastern and Western Districts of Michigan, along with the Federal Bureau of Investigation (FBI) and the Grand Rapids Public Schools, will be hosting Advanced Law Enforcement Rapid Response Training (ALERRT) next week. The training will be held at Pine School in Grand Rapids from July 15-18, 2013. The training is presented by Texas State University through funding by a number of government sources and is offered at no cost to participants. The training offered in Grand Rapids is a partnership between the FBI, the Bureau of Justice Assistance, VALOR, Texas State University and the United States Attorney Offices in Eastern and Western Michigan. The Advanced Law Enforcement Rapid Response Training Center at Texas State University has partnered with the FBI to deliver this vital active shooter training across the nation. ALERRT has trained more than 45,000 officers in the United States since 2002 through federal and state funding.
This training lasts two days and involves both classroom work and practical exercises. The first session is for Law Enforcement Departments from the Eastern District of Michigan and it will be held July 15-16, 2013. The second session is for Law Enforcement Departments from the Western District of Michigan and will be held July 17-18, 2013. Each session will have approximately 30 officers from 20 departments, allowing about 60 officers from over 40 departments to be trained over the four day period. The United States Attorney Offices and the FBI are particularly grateful to the Grand Rapids Public Schools for allowing the use of Pine Elementary School for this important training.
The U.S. Attorney for the Western District of Michigan, Patrick A. Miles, Jr., stated “Unfortunately no community is immune from a potential active shooter situation. This training in Grand Rapids is so law enforcement is ready if it does.”
Robert D. Foley III, Special Agent in Charge of the FBI Detroit Field Office added, “The FBI is proud to partner with the U.S. Attorney Offices in the Eastern and Western Districts along with other agencies to offer this valuable training designed to save lives during active shooter situations. The F.B.I. is committed to ensuring the safety of citizens and protecting our communities.”
Barbara L. McQuade, U.S. Attorney for the Eastern District of Michigan stated, “This training will better equip officers in Michigan to respond to an active shooter situation, which we have seen can occur at any time or any place.”
Larry Johnson, Assistant Superintendent and Executive Director of Public Safety for Grand Rapids Public Schools said, "As a district, we are committed to comprehensive, ongoing training and emergency preparedness to ensure our professional staff are well equipped to handle the most difficult situations. It is truly an honor for us to partner with the U.S. Attorney's Offices and the FBI on this important training by making one of our schools available and to having some of our staff members participate."
If the media is interested in receiving additional information regarding this training, please contact Kaye Hooker at 616-560-6512. There will be an opportunity for the media to meet with instructors, learn about the training and take some still shots on Thursday, July 18, 2013 at 12:30 p.m.
END
Federal Jury Finds Shiprock, N.M., Man Guilty on Involuntary Manslaughter, Assault and Firearms ChargesRead the Press Release
ALBUQUERQUE – A federal jury sitting in Albuquerque, N.M., returned a guilty verdict this afternoon against Clay O’Brien Mann, 28, an enrolled member of the Navajo Nation who resides in Shiprock, N.M., on involuntary manslaughter, assault and firearms charges after a five-day trial. The guilty verdict was announced by U.S. Attorney Kenneth J. Gonzales, Carol K.O. Lee, Special Agent in Charge of the Albuquerque Division of the FBI, and John Billison, Director of the Navajo Nation Division of Public Safety.
Mann was arrested in July 2010, on a criminal complaint alleging that he killed a Navajo man and assaulted another Navajo man and a Navajo woman with a dangerous weapon on the Navajo Indian Reservation, on July 24, 2010. Mann subsequently was indicted and charged with first degree murder, two counts of assault with a dangerous weapon with intent to do bodily injury, two counts of assault resulting in serious bodily injury, and three counts of discharging a firearm in furtherance of an act of violence. Proceedings in the case were delayed by competency proceedings.
Trial of the case began on July 8, 2013, and concluded earlier this afternoon when the jury returned a verdict finding Mann not guilty on the first degree murder charge but guilty on the lesser included charge of involuntary manslaughter. The jury also found Mann guilty on two counts of assault resulting in serious bodily injury and two counts of discharging a firearm in furtherance of an act of violence. It acquitted Mann on two counts of assault with a dangerous weapon with intent to do bodily injury and the third firearms charge.
The evidence at trial established that, at approximately 4:00 a.m. on July 24, 2010, an inebriated Mann drove his car to his neighbor’s property and launched an artillery shell into the neighbor’s property where the neighbor and his friends were socializing. When Ames Joseph Jim and another man and a woman walked over to see what was going on, Mann fired a semi-automatic rifle at them, shooting Mr. Jim in the face and heart, the other man in the face and the woman in the neck. Mr. Jim died as a result of his injuries and the other two victims sustained serious bodily injury.
Mann has been in federal custody since his arrest in July 2010, and remains detained pending his sentencing hearing, which has yet to be scheduled. At sentencing, Mann faces a maximum eight years in prison on the involuntary manslaughter charge and a maximum ten years in prison on each of the two assault charges. Mann also faces a mandatory 35 years in prison on the two firearms charges which must be served consecutive to any prison sentence imposed on the involuntary manslaughter and assault charges.
This case was investigated by the Farmington office of the FBI and the Shiprock office of the Navajo Nation Division of Public Safety and is being prosecuted by Assistant U.S. Attorney Presiliano A. Torrez.
East St. Louis Man Sentenced for Filing A False Federal Income Tax ReturnRead the Press Release
Demetrius L. Combs, 22, of East St. Louis, Illinois, was sentenced to five years of probation, six months home detention and ordered to pay restitution to the Internal Revenue Service in the amount of $2662 for the offense of Filing a False Federal Income Tax Return, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Combs had a false and fraudulent 2010 federal income tax return prepared by Prime Time Tax Services. Delaun Leflore and Carey Herron owned and operated Prime Time Tax Services (PTTS) located in Shiloh, Illinois. During the 2008-2011 filing seasons, Leflore and Herron used electronic software to prepare and file tax returns and they typically applied for refund anticipation loans. Leflore and Herron conspired together and with their clients to prepare false tax returns and claim fraudulent tax refunds. To accomplish this scheme, Leflore and Herron created false and fraudulent Schedule C income and expenses. The purpose of creating the false income was to maximize the earned income credit and other credits which generated large tax refunds. While meeting with their clients, Leflore and Herron discussed how to receive more money back by creating self-employment income. The clients agreed to participate in the scheme in order to receive a larger tax refund. Typically, the clients were referred to Leflore and Herron and visited the tax preparation business knowing they would file fraudulent tax returns. As part of the scheme, the clients were required to pay an extra cash fee to Leflore or Herron from the tax refund received. This amount was generally $500 in cash. This amount was in addition to the tax preparation fee which was automatically deducted from the tax refund by the bank processing the refund anticipation loan (RAL). Following the receipt of the RAL check, Leflore, Herron, or another representative of PTTS escorted the clients to a local check-cashing business named Belleville Quick Stop located in Belleville, Illinois. After the client cashed the RAL check, the client immediately gave the $500 in cash to Leflore, Herron, or another representative of Prime Time. Leflore and Herron have already been prosecuted and are serving their prison sentences.
The successful prosecution is the result of an investigation conducted by the Internal Revenue Service/Criminal Investigations. The prosecution was handled by Assistant U.S. Attorney Norman R. Smith.
Eagle Butte Man Pleads Guilty to Distribution of A Controlled SubstanceRead the Press Release
United States Attorney Brendan V. Johnson announced that Sylvan Charles Brown III, age 30, of Eagle Butte, South Dakota, appeared before U.S. District Judge Roberto A. Lange on July 11, 2013, and pled guilty to Count II of the Indictment that charged him with Distribution of a Controlled Substance.
The maximum penalty upon conviction is 20 years of imprisonment, a $1,000,000 fine, or both; a mandatory period of 3 years up to life of supervised release, an additional 2 years of supervised release upon revocation; and a $100 special assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charge stems from an incident on November 14, 2012, when Brown distributed methamphetamine. The suspected methamphetamine was sent to the lab for analysis and tested positive.
The investigation was conducted by the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Kathryn N. Rich is prosecuting the case.
Brown was remanded to the custody of the U.S. Marshals Service pending sentencing which has been set for September 30, 2013.
# # #Eagle Butte Man Pleads Guilty to Assaulting A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that Colton White Feather, age 18, of Eagle Butte, South Dakota, appeared before U.S. District Judge Roberto A. Lange on July 11, 2013, and pled guilty to the Indictment that charged him with Assaulting a Federal Officer.
The maximum penalty upon conviction is 8 years of imprisonment, a $250,000 fine, or both; 3 years of supervised release, and an additional 2 years of supervised release upon revocation. Restitution and a $100 special assessment to the Federal Crime Victims Fund may also be ordered.
The conviction stems from an incident on or about November 23, 2012, when two Cheyenne River Sioux Tribal Police Officers were called to the defendant’s residence in Eagle Butte to respond to a fight between White Feather and another person. After arriving and being let into the house, one of the officers had contact with the defendant in a back bedroom. During that contact, the defendant became upset when he learned he was going to be arrested for underage consumption, and to avoid arrest he had physical contact with the officer. At the time of the unlawful assault, the police officer was engaged in the performance of his official duties as law enforcement.
The investigation was conducted by the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Mikal Hanson prosecuted the case. White Feather was remanded to the custody of the U.S. Marshals Service pending sentencing which has been set for September 30, 2013.
# # #Dustin Roy Gilpin Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on July 11, 2013, before Chief U.S. District Judge Dana L. Christensen, DUSTIN ROY GILPIN, a 33-year-old resident of Kalispell, was sentenced to a term of:
Probation: 5 years
Special Assessment: $100
GILPIN was sentenced in connection with his guilty plea to receipt of obscenity.
In an Offer of Proof filed by Assistant U.S. Attorney Cyndee L. Peterson, the government stated it would have proved at trial the following:
As part of an Internet Crimes Against Children Task Force investigation, a Madison County Deputy Sheriff determined an IP address in Kalispell was offering known child pornography files available for download via the Internet. The subscriber information for that IP address was GILPIN'S residence. The Flathead County Sheriff's Office obtained a search warrant for that residence.
On July 3, 2012, the warrant was served, and two generic desktop computers were seized and subsequently forensically examined.
On the first computer the examiner located image files which depict obscene matters of indecent character, specifically children engaged in sexual conduct. The examiner determined that some of the files were associated with the peer-to-peer file sharing program LimeWire. The examiner also determined the files were created between May 2012 and July 2012.
On the second computer the examiner located image files which depict obscene matters of indecent character, specifically children engaged in sexual conduct. The examiner determined these files were also associated with the peer-to-peer file sharing program LimeWire. The files were created between September 29, 2011, and March 13, 2012.
The investigation was a cooperative effort between the Internet Crimes Against Children (ICAC) Task Force, the Madison County Sheriff's Office, the Flathead County Sheriff's Office, and the Montana Division of Criminal Investigation.
This case was brought as part of Project Safe Childhood (PSC), 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, PSC 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 PSC, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab "resources."
District Man Found Guilty of Second-Degree Murder While Armed in 2012 Slaying in Northwest Washington-Defendant Stabbed Victim During Confrontation on Street-Read the Press Release
WASHINGTON – Herbert G. Hayes, 41, of Washington, D.C., was found guilty by a jury today of second-degree murder while armed in a slaying that took place last year in Northwest Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Hayes was found guilty by a jury following a trial in the Superior Court of the District of Columbia. The Honorable Russell F. Canan scheduled sentencing for Sept. 20, 2013. Hayes faces a statutory maximum of 40 years in prison for the crime.
According to the government’s evidence, on May 18, 2012 at about 9:30 p.m., Hayes chased the victim, John Wesley Griffin, 42, down the sidewalk in the 1200 block of North Capitol Street NW. As the chase continued, Mr. Griffin yelled, “Police, police!” Mr. Griffin ran into the street and Hayes followed him. Mr. Griffin then turned and faced Hayes, putting up his fists to fight. At that point, Hayes stabbed him. Mr. Griffin staggered to the sidewalk and then collapsed. Hayes stood over him, and with knife in hand, shouted an expletive about the police before fleeing the scene. Mr. Griffin died as a result of his wounds.
Hayes was arrested on May 21, 2012, and has been in custody ever since.
In announcing the verdict, U.S. Attorney Machen praised the work of the detectives, officers and mobile crime scene technicians who investigated the case for the Metropolitan Police Department (MPD). He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Mia Beamon, Victim/Witness Advocate Tamara Ince; Litigation Technology Specialists Kimberly Smith and Ron Royal, and Interns Daniel Fletcher and Lauren Sparks. Finally, he expressed appreciation for the work of Assistant U.S. Attorney Melinda Williams and former Assistant U.S. Attorney Mary Chris Dobbie, who secured the indictment in the case, and Assistant U.S. Attorney Adrienne Dedjinou, who prosecuted the case.
13-243Court Approves Comprehensive Assignment Plan in Longstanding Tennessee Desegregation CaseRead the Press Release
Today, the U.S. District Court for the Western District of Tennessee approved a comprehensive consent order in McFerren v. County Board of Education of Fayette County, which the Department of Justice negotiated with the Board of Education of Fayette County, Tenn., and the NAACP Legal Defense & Educational Fund to desegregate the Fayette County public schools.
The consent order requires the district to take the following steps:
· Close four of its seven elementary schools, including a racially identifiable white school and two racially identifiable black schools.
· Construct a new elementary school to be opened by the start of the 2014-15 school year.
· Revise its attendance zone lines.
· Implement a controlled choice program between two of its schools.
· Explore and possibly create a magnet program at the elementary school with the highest projected African-American enrollment.
· Continue intra-district student transfers that further desegregation among its schools.
Today’s consent order replaces a previous consent order approved in 2012, as part of a collective effort by the parties to ensure even greater desegregation of the schools while achieving financial savings for the district. Before it can be declared unitary, the district must comply in good faith with its desegregation obligations for a minimum of three years, until the end of the 2016-17 school year, and eliminate the vestiges of segregation in its schools.
“The parties’ diligence and creativity resulted in meaningful progress towards desegregation of the schools,” said Jocelyn Samuels, Principal Assistant Attorney General for the Civil Rights Division. “Their efforts demonstrate that a district can desegregate its schools in a fiscally responsible manner that ensures educational opportunities for all students.”
The enforcement of Title IV of the Civil Rights Act of 1964 in school districts is a top priority of the Justice Department’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.
Contrack International Inc. Agrees to Pay<br /> $3.5 Million to Resolve False Claims Act AllegationsRead the Press Release
Contrack International Inc., a global design and construction company headquartered in McLean, Va., has agreed to pay $3.5 million to settle allegations that it submitted false claims in connection with U. S. Agency for International Development (USAID) contracts, the Justice Department announced today.
“Misrepresentations during contract negotiations undermine the integrity of the government procurement process,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “The Justice Department will take action where contractors misrepresent their qualifications for government contracts and programs.”
The settlement concerns USAID-funded contracts for the construction of water and wastewater infrastructure projects in the Arab Republic of Egypt in the 1990s. The bidders for these contracts were required to receive prequalification and, in some cases, establish that they were U. S. companies. However, the contracts were ultimately performed by a joint venture partnership among Contrack; Washington Group International, Inc., a subsidiary of URS Corporation; and Misr Sons Development S.A.E. (Hassan Allam Sons), an Egyptian company. The government filed suit under the False Claims Act and the Foreign Assistance Act alleging that the joint venture partners evaded the prequalification requirement by concealing the identity of the joint venture partners, which prevented USAID from accurately evaluating their qualifications. As a result, the government alleged that Contrack and its partners received USAID-funded contracts for which they were ineligible.
“Proper public contracting, government efficiency and government accountability rely on complete information from contractors,” said Wendy J. Olson, U.S. Attorney for the District of Idaho. “Along with our partners at USAID and the Department of Justice’s Commercial Litigation Branch, we will aggressively seek to recover improperly awarded taxpayer dollars.”This settlement – which resolves only Contrack’s liability – was the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the District of Idaho; and the USAID Office of Inspector General. The government is continuing to pursue its claims against the other two defendants in the suit.
The case is United States v. Washington Group International Inc. f/k/a/ Morrison Knudsen, Corporation; Contrack International, Inc.; and Misr Sons Development S.A.E. a/k/a Hassan Allam Sons, No. 04-555 (N.D. Idaho). The claims resolved by this settlement are allegations only, and there has been no determination of liability.
Cocaine Courier Sentenced to Federal PrisonRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that CHRISTOPHER PAPPAGALLO, 40, of Vernon, was sentenced today by United States District Judge Stefan R. Underhill in Bridgeport to 24 months of imprisonment, followed by three years of supervised release, for his role in a cocaine trafficking conspiracy.
According to court documents and statements made in court, PAPPAGALLO was paid by an associate to transport more than 100 kilograms of cocaine from California to Connecticut. PAPPAGALLO acted a courier on three different occasions, earning $10,000 for the first trip, $8,500 for the second trip and $17,000 for the third trip. PAPPAGALLO’s third trip occurred in January 2012, when he transported approximately 54 kilograms of cocaine to Connecticut.
PAPPAGALLO pleaded guilty to a cocaine conspiracy charge on April 1, 2013.
This matter has been investigated by the Drug Enforcement Administration, the New Britain Police Department and the East Central Narcotics Task Force, which includes the Manchester, South Windsor, Glastonbury and Vernon Police Departments. The case is being prosecuted by Assistant United States Attorney Geoffrey M. Stone.
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(203) 821-3722 [email protected]Clifton Man Pleads Guilty to Production of Child PornographyRead the Press Release
DENVER – Robert Arthur Brewster, age 41, of Clifton, Colorado pled guilty earlier this week before U.S. District Court Judge R. Brooke Jackson to the production of child pornography, U.S. Attorney John Walsh and U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) Special Agent in Charge Kumar Kibble announced. Brewster appeared at the change of plea hearing in custody. Judge Jackson is scheduled to sentence Brewster on September 24, 2013 at 8:00 a.m.
Brewster was indicted by a federal grand jury on February 26, 2013. He pled guilty on July 10, 2013.
According to court documents, including the stipulated facts contained in the plea agreement, beginning on January 7, 2010, the defendant initiated contact using an instant message program with an individual whom he believed to be a 13 year old girl living in Kentucky. In truth, the 13 year old girl was an undercover Kentucky based Internet Crimes Against Children task force officer. Over the following month, the defendant engaged in multiple conversations where he actively shared multiple images and videos depicting child pornography in an effort to entice the undercover officer to participate in the production of child pornography for him. Brewster went as far as sending a brand new web camera to the undercover officer.
During the conversations, the defendant admitted to producing child pornography himself and sent 3 of the images he produced as proof. All 3 of the pictures constituted child pornography, were of a minor child to whom he had access, and in each of the pictures the tattoo on his lower left arm was visible.
A search warrant was executed at his residence in Clifton, Colorado. Media seized from the defendant’s residence yielded 870 images of child pornography and 22 videos of child pornography on the Defendant’s computer. Among the media were the images of the minor child to whom he had access to as described above -- revealing 23 images of that minor child of which 20 were actual child pornography.
“The production of child pornography is one of the most serious crimes prosecuted by the U.S. Attorney’s Office,” said U.S. Attorney John Walsh. “Thanks to the hard work of Homeland Security Investigations and the Mesa County Sheriff’s Office, working closely with Assistant U.S. Attorneys, the defendant was arrested, and thus prevented from continuing the sexual assaults of his minor victim, in essence rescuing his victim from continued exploitation.”
“The sexual exploitation of children is a heinous crime that can scar and debilitate its victims forever,” said Kumar Kibble, special agent in charge of HSI Denver. “To rescue these innocent victims, HSI works in tandem with the U.S. Attorney’s Office and our international, state and local law enforcement partners to vigilantly protect our communities from child sex predators.”
Brewster faces a mandatory minimum 15 years in federal prison, and a maximum of not more than 30 years in federal prison. He also faces a term of supervised release of not less than 5 years, and up to life. In addition, Brewster faces a fine of up to $250,000 as well as restitution. He will also be required to register as a sex offender. Finally, he has agreed to forfeit all of his computers and computer media used in the production of and or containing child pornography, including 3 laptop computers, a computer tower, 2 cameras, a web camera, 2 thumb drives, and one external hard drive.
This case is being investigated by U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), the Mesa County Sheriff’s Office, and officers from the Internet Crimes Against Children Task Force.
Brewster is being prosecuted by Special Assistant U.S. Attorney Shana Martin and Assistant U.S. Attorney Alecia Riewerts Wolak.
This case was brought as part of Project Safe Childhood (PSC), 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, PSC 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 PSC, please visit http://www.justice.gov/psc/ For more information about Internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab "resources."
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Charles City Man Charged with Being A Felon in Possession of Firearms Stolen from an Auction Yard in Floyd CountyRead the Press Release
Randy Patrie, age 40, from Charles City, Iowa, has been charged with one count of being a felon in possession of a firearm. The charges are contained in a Complaint filed on July 10, 2013, in United States District Court in Cedar Rapids.
The Complaint alleges that, on or about July 4, 2013, Patrie was found in possession of more than 20 firearms during a search of his home by the Charles City Police Department. Officers searched Patrie’s home while investigating a burglary of a residence in Charles City that occurred on July 4, 2013. During the search, officers found 20 firearms stolen from Gilbert’s Sale Yard, located in rural Floyd, Iowa. Gilbert’s Sale Yard was burglarized on May 2, 2013. The Complaint further alleges that Patrie admitted to law enforcement officers that he committed the Gilbert’s Sale Yard burglary and stole the firearms, and further admitted he knew he was prohibited from possessing the firearms because he was a convicted felon. According to the complaint, Patrie has the following prior felony convictions: on September 24, 1991, in the Iowa District Court for Mitchell County of Attempted Burglary in the 2nd degree; on May 28, 1996, in the Iowa District Court for Floyd County of Delivery of Methamphetamine; and on May 27, 2003, in the Iowa District Court for Floyd County, of Burglary 3rd.
If convicted, Patrie faces a possible maximum sentence of 10 years’ imprisonment, a $250,000 fine, $100 in special assessments, and 3 years of supervised release following any imprisonment.
Patrie appeared today in federal court in Cedar Rapids and was held pending a detention hearing scheduled for July 14, 2013, at 11:00 a.m.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.The case is being prosecuted by Assistant United States Attorney C.J. Williams and was investigated by the Federal Bureau of Alcohol, Tobacco, Firearms and Explosive, the Iowa Division of Criminal Investigation, the Charles City Police Department, and the Floyd County Sheriff’s Office.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 13-mj-196.
Cedrick Marc Leiby Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on July 9, 2013, before Senior Wm. Fremming Nielsen, CEDRICK MARC LEIBY, a 35-year-old resident of Billings, was sentenced to a term of:
Prison: 150 months
Special Assessment: $300
Restitution: to be determined
Supervised Release: 4 years
LEIBY was sentenced in connection with his guilty plea to conspiracy to possess methamphetamine with intent to distribute, obstruction of justice/witness tampering, and possession of a stolen firearm.
In an Offer of Proof filed by Assistant U.S. Attorney Marcia K. Hurd, the government stated it would have proved at trial the following:
LEIBY came to the attention of law enforcement officers as part of a larger drug case. LEIBY was identified as a person who bought large amounts of methamphetamine brought from Las Vegas to Billings on behalf of supplier Howard Bonifant. LEIBY was identified by Bonifant's runners as being among their biggest customers, and he is prominent in phone tolls, drug ledgers, and in the dealers' phones. Various customers of his also identified LEIBY as their supplier, and one of the bigger dealers in Billings by the fall of 2010. LEIBY conspired with others to distribute over 500 grams or more of a mixture of substance containing a detectable amount of methamphetamine.
After LEIBY was indicted on the charge of conspiracy to possess methamphetamine with intent to distribute, and while he was in the Yellowstone County Detention Facility pending state charges, he knew there was a detainer on him for federal charges. He approached another defendant in the larger drug case while they were both incarcerated at the facility. This individual had already given law enforcement information on the drug case, including information on LEIBY. LEIBY came to the person's cell and handed him a hand-written note on a piece of paper. The note said something to the effect of "I, blank space, have never given or sold Cedric Leiby any methamphetamine." LEIBY told him to sign the paper or something would happen to him if he did not. This individual believed that LEIBY knew a lot of people at YCDF and that if he did not sign the paper, LEIBY would have someone hurt him. He wrote his name on the blank spot and gave the paper back to LEIBY. LEIBY had the person's cell mate sign as a witness to the signature. LEIBY has continued to tell people that the person ratted LEIBY out, and he has concerns for his safety. LEIBY has also called the person a "rat" in a loud enough voice for others in the cellblock at YCDF to hear, and thus the person was moved to another unit for his own safety.
On August 11, 2011, LEIBY had come to the attention of law enforcement authorities when a car was stopped for a traffic violation and was found to have sale tags from Sports Authority inside. The deputy was familiar with the recent theft of six firearms from that location. The vehicle was impounded and a search warrant obtained. Officers also searched the driver's residence as permitted by his supervising probation officer. In a hidey-hole in the garage five of the six firearms stolen from Sports Authority were found.
Further investigation revealed that LEIBY stole the guns from Sports Authority by cutting the security chains with a bolt cutter and leaving through a back door of the store. LEIBY took the guns to the residence and put them in the hidey-hole in the garage.
Bonifant pled guilty to federal charges and has been sentenced.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that LEIBY will likely serve all of the time imposed by the court. In the federal system, LEIBY does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was a cooperative effort between the Federal Bureau of Investigation and the Billings Big Sky Safe Streets Task Force.
Canadian Man Pleads Guilty to Access Device FraudRead the Press Release
BUFFALO, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Taylor Vaughn Oliver, 28, a Canadian resident, pleaded guilty before Chief U.S. District Judge William M. Skretny, to access device fraud. The charge carries a maximum penalty of 10 years in prison, a fine of $250,000 or both.
Assistant U.S. Attorney John E. Rogowski, who is handling the case, stated that the defendant made $18,000 worth of purchases using fraudulent credit cards, mostly gift cards. Surveillance videos from many of the stores identified Oliver as the person using the fraudulent cards. The defendant was in the United States during three weekends when the purchases were made in Ohio, Pennsylvania, and New York. Law enforcement officers recovered approximately $10,000 in goods purchased with the fraudulently obtained gift cards from a storage unit.
The plea is the culmination of an investigation on the part of Special Agents of Immigration & Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero.Sentencing is scheduled for October 17, 2013, at 9:00 a.m. before Chief Judge William M. Skretny.
Canadian Citizen Sentenced in Manhattan Federal Court to 20 Years in Prison in Connection with $7 Million Advance-Fee Fraud SchemeRead 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”), announced today that DAVID “JIM” NORMAN was sentenced in Manhattan federal court to 20 years in prison for his role in a scheme to defraud victims across the country out of millions of dollars. As part of the scheme, NORMAN promised victims huge guaranteed returns on investments to be paid out of overseas bank accounts that in reality did not exist. Following his extradition from Canada in November 2011, NORMAN was convicted of conspiracy to commit wire fraud in January 2013, after a six-day jury trial. U.S. District Judge Katherine B. Forrest presided over the trial and sentenced NORMAN today.
Manhattan U.S. Attorney Preet Bharara said: “By promising huge returns on their investments, Jim Norman induced scores of victims from around the country to give him millions of dollars. As proven at trial, his promise was nothing more than a shameless scheme to steal hard-earned money from the victims, some of whom lost their entire life savings and even their homes. With today’s sentence, Norman will pay the price for his fraud and the suffering that he has caused his victims.”
FBI Assistant Director-in-Charge George Venizelos said: “As the jury found, Jim Norman used fast talk and the lure of easy profits to separate credulous investors from their money. The promissory notes he issued were as fraudulent as the rest of his scheme. The immediate results were ill-gotten gains for Norman and devastating losses for his victims. The endgame for Norman is a lengthy prison term.”
According to the evidence presented at trial, beginning in 2004 through his arrest in Canada in December 2009, NORMAN told victims that, as part of the “Jim Norman Program,” he was seeking investors to help pay fees to secure the release of hundreds of millions of dollars held in bank accounts in Spain and Switzerland. NORMAN, along with his co-conspirators in the United States who helped lure victims into the scheme, stole at least $7 million from more than 100 victims by promising them huge returns on their investments – that would be paid in a matter of days or weeks at most – and by giving victims official-looking, but worthless, “promissory notes” that purportedly guaranteed their investments and return. In reality, there were no overseas accounts, and NORMAN and his co-conspirators spent the victims’ money on themselves by making large retail purchases and withdrawing hundreds of thousands of dollars in cash. As a result of the fraudulent scheme perpetrated by NORMAN, some victims lost all their assets, others lost their homes, and others lost their businesses.
In addition to the prison term, Judge Forrest sentenced NORMAN, 64, of Toronto, Canada, to three years of supervised release. NORMAN was also ordered to forfeit $2,197,637 and pay $1,731,805 in restitution, in addition to a $100 special assessment fee.
Mr. Bharara praised the FBI for its outstanding work on this case.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Andrew Goldstein and Andrea Surratt are in charge of the prosecution.
Buffalo Man Convicted Following Jury Trial of Gun and Drug ChargesRead the Press Release
BUFFALO, N.Y. -- U.S. Attorney William J. Hochul, Jr. announced today that Tyrone Nance, 32, of Buffalo, N.Y., was convicted following a jury trial of being a felon in possession of a firearm and possession of marijuana. The charges carry a maximum sentence of 10 years in prison, a $250,000 fine or both.
Assistant U.S. Attorneys Frank T. Pimentel and Mary Catherine Baumgarten, who handled the trial, stated that in November 2011, federal probation officers conducted a search of the defendant’s residence and car on Timon Avenue in Buffalo. Nance was on supervised release as a result of a 2009 conviction for conspiracy to distribute marijuana. During the search, officers recovered a shotgun hidden under the hood of the defendant’s car. They also recovered a quantity of marijuana from the freezer in the defendant’s residence. DNA analysis performed by the Erie County Forensics Laboratory tied the shotgun to the defendant.
The verdict is the culmination of an investigation on the part of the United States Probation Department, under the direction of Anthony SanGiacomo, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Resident Agent in Charge Frank Christiano.
Sentencing is scheduled for November 4, 2013 at 9:00 a.m. before Chief U.S. District Judge William M. Skretny who presided over the trial.Bruce Wayne Eagleman, Jr. Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Helena, on July 9, 2013, before U.S. District Judge Sam E. Haddon, BRUCE WAYNE EAGLEMAN, JR., a 25-year-old resident of Hardin and an enrolled member of the Crow Tribe of Indians, pled guilty to second degree murder. Sentencing has been set for October 21, 2013. He is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Jessica A. Betley, the government stated it would have proved at trial the following:
On November 23, 2011, the Hardin City Court ordered EAGLEMAN to participate in the 24/7 sobriety program in Bighorn County. EAGLEMAN had just been arrested for disorderly conduct, criminal trespass to property, an open container violation, and possession of drug paraphernalia. He pleaded guilty to disorderly conduct after he admitted to drinking a gallon of gin on the day of his arrest.
The 24/7 sobriety program became law in Montana on October 1, 2011. The program is designed to address the most serious alcohol offenders in the state, and also, to verify that these people are not drinking and driving. Pursuant to this program, the Hardin Court ordered EAGLEMAN to take a breath test twice a day - the first between 7 a.m. and 9 a.m. and the second between 7 p.m. and 9 p.m.
The Hardin City Court was also familiar with EAGLEMAN due to his previous driving under the influence conviction. On July 11, 2008, EAGLEMAN pleaded guilty to driving under the influence of alcohol after he stated he drank twelve, 24-ounce, cans of beer. EAGLEMAN, who is 25-years-old, also has never had a valid driver's license.
During the morning of December 29, 2011, EAGLEMAN's mother drove him from Crow Agency to Hardin to take his morning breath test. EAGLEMAN and his mother then returned to Crow Agency. Sometime in the early afternoon, EAGLEMAN took his mother's 2006 Dodge Durango and said he was leaving to go check the mail. Instead, EAGLEMAN left the house and met up with V.F.
EAGLEMAN and V.F. drove to a friend's house in Crow Agency. Everyone discussed driving to Hardin. Shortly thereafter, EAGLEMAN, V.F., and a friend drove to Hardin. EAGLEMAN drove his mother's Durango. EAGLEMAN and V.F. had already drank four malt liquors earlier in the afternoon. As EAGLEMAN drove to Hardin, the friend said EAGLEMAN began to drive more erratically.
EAGLEMAN first drove to a pawn shop, where he pawned a few items and received $10. EAGLEMAN used the $10 to buy a liter of Nikolai gin. EAGLEMAN next drove to another pawn shop. At the pawnshop, an employee observed that EAGLEMAN was extremely intoxicated. She saw EAGLEMAN leave and get in the driver's seat of the Durango.
After leaving the pawn shops, EAGLEMAN made a few more stops for gas and at another friend's house. Finally, he drove to the grocery store where he purchased two cans of Mike's Hard Lemonade and left the store. EAGLEMAN dropped the friend off in Hardin, which left just V.F. in the car with EAGLEMAN. EAGLEMAN then drove back to Crow Agency.
EAGLEMAN drove back to Crow Agency by way of the two-lane East Frontage Road. Initially he drove in the correct lane of travel - the southbound lane. At approximately 5:40 p.m., however, EAGLEMAN crossed into the northbound lane of the road and directly in front of S.S.'s oncoming car. S.S. attempted to drive to the left to avoid the oncoming crash, but was unsuccessful. The passenger side of EAGLEMAN's Durango collided with the passenger side of S.S.'s car in the northbound lane of traffic - the correct lane of traffic for S.S. A witness drove up almost immediately thereafter and saw EAGLEMAN in the driver's seat of the Durango.
Responding medical and law enforcement saw that V.F. was still alive, but he could not breathe well. He died shortly thereafter. S.S. had two other passengers in her car, both of whom died on scene. An ambulance transported S.S. to the hospital where she died. EAGLEMAN suffered minor injuries and was released from the hospital. Soon after the crash, at 6:52 p.m. that evening, his blood alcohol content was .257. He also tested positive for opiates and THC.
EAGLEMAN faces possible penalties of life in prison, a $250,000 fine and 5 years supervised release.
The investigation was a cooperative effort between the Federal Bureau of Investigation, the Montana Highway Patrol, and the Bureau of Indian Affairs.