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10 July 2013
White River Woman Sentencd for Simple Assaultand Aiding and AbettingRead the Press Release
United States Attorney Brendan V. Johnson announced that a White River, South Dakota woman convicted of Simple Assault and Aiding and Abetting was sentenced on July 8, 2013, by U.S. Magistrate Judge Mark A. Moreno.
Ashley Vanderwalker, age 25, was sentenced to 12 months’ probation and $10 to the Federal Crime Victims Fund.
Vanderwalker was indicted by a federal grand jury on April 12, 2013, and pled guilty to the charge on June 17, 2013.
The conviction stems from an incident that took place on April 3, 2011, when Vanderwalker and others assaulted the victim with a bat.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Marie H. Ruettgers. Vanderwalker was released.
# # #White River Woman Sentencd for Simple Assaultand Aiding and AbettingRead the Press Release
United States Attorney Brendan V. Johnson announced that a White River, South Dakota woman convicted of Simple Assault and Aiding and Abetting was sentenced on July 8, 2013, by U.S. Magistrate Judge Mark A. Moreno.
Ashley Vanderwalker, age 25, was sentenced to 12 months’ probation and $10 to the Federal Crime Victims Fund.
Vanderwalker was indicted by a federal grand jury on April 12, 2013, and pled guilty to the charge on June 17, 2013.
The conviction stems from an incident that took place on April 3, 2011, when Vanderwalker and others assaulted the victim with a bat.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Marie H. Ruettgers. Vanderwalker was released.
# # #Weston Man Indicted for Production and Possession of Child PornographyRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s, Homeland Security Investigations (ICE-HSI) and Scott Israel, Broward Sheriff’s Office, announce the indictment of Thomas Edler, 48, of Weston, on child pornography charges. Edler has appeared before U.S. Magistrate Judge Patrick M. Hunt in Fort Lauderdale and was detained pending trial.
The four-count indictment charges Edler with three counts of production of child pornography and one count of possession of child pornography, in violation of Title 18, United States Code, Sections 2251(a) and 2252(a). If convicted, Edler faces a mandatory minimum sentence of 15 years in prison and a maximum sentence of up 30 years. Edler would also be required to register as a sex offender in any jurisdiction in which he lives, works or attends school.
According to documents filed with the court, in February 2013, the National Center for Missing and Exploited Children (NCMEC) requested the assistance of the South Florida Internet Crimes against Children (ICAC) Task Force to help identify a child who appeared in numerous images of child pornography that had been recovered across the county. These images had been previously identified and categorized by NCMEC as the “Dave” series. During the investigation that followed, detectives assigned to the South Florida ICAC Task Force determined that the images in the “Dave” series were taken at Edler’s Weston residence.
On April 9, 2013, law enforcement executed a federal search warrant at Edler’s residence and seized several items of electronic media. A forensic analysis revealed numerous images of children under the age of 12 in sexually suggestive poses. These images were taken with a camera belonging to Edler. Subsequent forensic investigation revealed that a camera belonging to Edler was also used to photograph a series of child pornography images categorized by NCMEC as the “Lil Charlie” series and at least one additional child who is still unidentified.
Mr. Ferrer commended the investigative efforts of ICE-HSI and the South Florida ICAC. The case is being prosecuted by Assistant U.S. Attorneys Corey Steinberg and Francis Viamontes.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Waterloo Felon Sentenced to Ten Years in Prison for Unlawful Possession of A FirearmRead the Press Release
A man who possessed a firearm after being convicted of a felony offense was sentenced today to ten years in federal prison.
Thaddeus Southall, 31, from Waterloo, Iowa, received the prison term after an April 18, 2013, guilty plea to one count of possession of a firearm by a felon.
At the guilty plea, Southall admitted that on November 2, 2012, he assaulted an individual inside a convenience store in Waterloo, Iowa. As the victim left the store, Southall told the store clerk that he would come back and shoot the clerk if the clerk called the police. Outside the store, Southall again hit the victim who was seated inside a car. As the car drove off, Southall shot and hit the victim’s car. When officers from the Waterloo Police Department arrested Southall a short time later, Southall fought with officers, kicking one police officer in the head.
Southall was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Southall was sentenced to the legal maximum of ten years’ imprisonment. A special assessment of $100 was imposed. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Southall is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was prosecuted as part of Project Safe Neighborhoods, a cooperative local, state and federal program aimed at the enhanced prosecution of gun crimes. The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by the Waterloo Police Department and the Bureau of Alcohol, Tobacco, and Firearms.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 13-2006.
United States Intervenes in Health Care Fraud Action and Obtains $4 Million in SettlementRead the Press Release
The United States will receive $4 million in settlement of a lawsuit brought under the False Claims Act against a cardiology practice and a hospital in Jackson, Michigan, United States Attorney Barbara L. McQuade announced today. McQuade was joined in the announcement by Lamont Pugh,III, Special Agent in Charge, Department of Health and Human Services Office of Inspector General (“HHS-OIG”) and Robert D. Foley, III, Special Agent in Charge, FBI Detroit Field Division.
The lawsuit, alleging medically inappropriate cardiology procedures, was filed by a Michigan cardiologist, Dr. Julie A. Kovach, against Jackson Cardiology Associates and its owner, cardiologist Jashu Patel M.D., and against Allegiance Health, a hospital, all located in Jackson, MI. The action was kept under seal while the government investigated. The government thereafter notified the defendants that it intended to intervene and prosecute the action, and the case was unsealed this week.
Dr. Patel and Jackson Cardiology Associates have now settled the case against them for $2.2 million and Allegiance Health, where many of the catheterizations were performed, has settled for $1.8 million. Dr. Kovach will receive a percentage of the recovery.
The complaint alleges that Dr. Patel and cardiologists employed by Jackson Cardiology Associates performed medically inappropriate cardiac procedures, including invasive catheterizations at Allegiance Health. Specifically, the evidence showed that Dr. Patel ordered catheterizations for patients based on findings from nuclear stress tests that he improperly read as positive. The government found that three-quarters of these patients had no significant heart blockages. These catheterizations involve snaking a hollow tube into the heart through an incision in the patient’s groin.
Dr. Kovach also alleged that Patel and Jackson Cardiology Associates performed a variety of other office-based medically unnecessary tests. A portion of the settlement with Allegiance Health also covered medically unnecessary peripheral stents performed on an outpatient basis. Because the unnecessary procedures were paid for by Medicare or Medicaid, the United States is entitled to money damages under the False Claims Act.
“This case is especially important because the defendants unnecessarily subjected patients to invasive and potentially harmful procedures. We urge other health care professionals with knowledge of medically harmful procedures to come forward, either by calling our office and asking to speak to the criminal or civil health care fraud coordinators, or through the qui tam whistleblower mechanism,” McQuade said.
The case was handled by Assistant U.S. Attorneys Joan Hartman and Linda Aouate, and was investigated by Special Agent John Anderson of HHS-OIG and FBI Special Agent Sean Nicol. In addition to the monetary settlement, the resolution also provides that Jackson Cardiology Associates and Allegiance Health will enter into Integrity Agreements with HHS-OIG.
United States Attorney Wigginton Announces Press EventRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that there will be a press event held tomorrow, Thursday, July 11, 2013, at 3:00 pm, at the Office of the United States Attorney for the Southern District of Illinois, located at Nine Executive Drive, Fairview Heights, IL, 62208-1344, concerning the announcement of a Health Care Fraud Investigation and resultant Charges.
Media are advised to have press credentials and to arrive in sufficient time to allow for security screening prior to the event.
Two St. Paul Men Indicted for Conspiring to Distribute MethamphetamineRead the Press Release
MINNEAPOLIS—Yesterday in federal court in St. Paul, two St. Paul men were indicted for conspiring to distribute methamphetamine. On July 9, 2013, Jorge De Jesus Gonzalez-Becerra, age 33, and Terry Lee Banks, Jr., age 37, were charged with one count of conspiracy to distribute methamphetamine. In addition, Banks was charged with one count of possession with intent to distribute cocaine and one count of possession with intent to distribute methamphetamine, while Gonzalez-Becerra was charged with three counts of possession with intent to distribute methamphetamine.
The indictment alleges that from March to June 12, 2013, the defendants conspired with each other and others to possess with intent to distribute 50 or more grams of methamphetamine, and that on June 12, they possessed with intent to distribute 450 or more grams of methamphetamine. It also alleges that Gonzalez-Becerra possessed with intent to distribute 29 grams of methamphetamine on March 13 and 31 grams of methamphetamine on March 25. In addition, on March 12, Banks possessed with intent to distribute five or more grams of cocaine.According to a law enforcement affidavit filed in the case, authorities began investigating Gonzalez-Becerra in March 2013. Eventually, they obtained approximately two ounces of methamphetamine, three grams of cocaine, and nine firearms during arranged controlled purchases. All of the transactions took place at Gonzalez-Becerra’s residence.
If convicted, the defendants face a potential maximum penalty of 40 years in prison on each count. All sentences would be determined by a federal district court judge. This case is the result of an investigation by the United States Drug Enforcement Administration, the St. Paul Police Department, the Ramsey County Sheriff’s Office, and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant U.S. Attorney Richard Newberry.An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.
Two Rochester Men Indicted in Sex Trafficking CaseRead the Press Release
ROCHESTER, N.Y.—U.S. Attorney William J. Hochul, Jr., announced today that Richard Bailey, 54, of Rochester, N.Y., pleaded guilty to distributing and receiving child pornography before U.S. District Judge Charles J. Siragusa. The charge carries a mandatory minimum penalty of five year in prison, a maximum of 20 years, a $250,000 fine, or both.
Assistant U.S. Attorney John J. Field, who is handling the case, stated that Bailey used a computer and peer-to-peer software to obtain and distribute images of child pornography which included violence against children. Some of the images involved prepubescent minors.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Acting Special Agent in Charge Richard M. Frankel.
Sentencing is scheduled for October 11, 2013, at 3:30 p.m. before Judge Siragusa.Two Mexican Citizens Residing in Dauphin County Charged with Document Fraud in Separate IndictmentsRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania and the U.S. Department of Homeland Security, Immigrations and Customs Enforcement, announced today that two citizens of Mexico have been charged with Fraud and Misuse of Documents in separate indictments.
According to United States Attorney Peter J. Smith, Martin Perez-Pimental, age 18, and Manuel Alvarez-Alcantara, age 41, were charged separately in one-count indictments by a federal grand jury in Harrisburg today.
The indictment alleges that on April 4, 2013, Alvarez-Alcantara did knowingly possess, use, or attempt to use a fraudulent permanent resident card and social security card in Dauphin County, Pennsylvania.
The indictment alleges that on April 24, 2013, Perez-Pimental did knowingly possess, use, or attempt to use a fraudulent permanent resident card and social security card in Dauphin County, Pennsylvania.
These investigations were conducted by the U.S. Department of Homeland Security, Immigration and Customs Enforcement and Homeland Security Investigations. They are being prosecuted by Special Assistant United States Attorney Brian G. McDonnell.Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilty is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
In these cases, the maximum penalty under the federal statute is 10 years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
Two Executives Plead Guilty to Wire Fraud Conspiracy Charges for Ponzi Scheme Involving Medical Insurance InvestmentsRead the Press Release
DALLAS — Duncan MacDonald III, 50, of Dallas, appeared yesterday in federal court and pleaded guilty to a felony Information charging conspiracy to commit wire fraud. In a related case, last week, Gloria Ann Solomon, 71, also of Dallas, pleaded guilty to an Information charging the same offense. Each defendant faces a maximum statutory penalty of five years in federal prison, a fine not to exceed $250,000, or twice any pecuniary gain to the defendant or loss to the victim(s), and restitution. Both MacDonald and Solomon will remain on bond pending sentencing, which is set for October 3, 2013, before U.S. District Judge Jane J. Boyle. 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, from at least 2006 and continuing into at least September 2012, MacDonald was President and Director of Global Corporate Alliance, Inc. (GCA). MacDonald operated GCA out of offices in Addison and Euless, Texas. He hired co-conspirator Solomon in January 2007 as GCA’s Chief Administrative Officer.
GCA managed the North American Consumer Alliance (NACA), a not-for-profit member association that created and packaged insured benefit association healthcare programs and policies administered to corporations, organizations and other entities. GCA sold the healthcare policies throughout the U.S. and maintained a conservative management fee. It collected fees called “overages” that were in excess of the conservative management fee.
In 2008, MacDonald created GCA’s “Overage Program” to sell interests in the overages through “Overage Purchase Agreements.” An investor’s potential return was directly related to the number of people who enrolled in a healthcare plan by purchasing a healthcare policy from CGA. GCA would pay the investor for each new healthcare plan enrollee. MacDonald installed Solomon as the program’s manager and she worked with MacDonald in conducting GCA’s activities regarding the Overage Program.
MacDonald initially planned to have only a single person invest in the Overage Program, but when one couldn’t be found, GCA fractionalized the program to make it available for multiple investors to provide smaller amounts of funds. GCA contracted with a sales agent to solicit individuals to invest, and the sales agent used information regarding the Overage Program that was provided by MacDonald and Solomon. That information included the number of current and projected healthcare plan enrollees that would drive investors’ potential returns.
MacDonald admits that he significantly inflated the current and projected enrollment figures by the thousands in an attempt to sell the Overage Program to investors. He and Solomon knew that the figures were false and that the sales agent would relay the figures to investors he was soliciting.
MacDonald also personally acquired investors for the Overage Program. In fact, MacDonald and Solomon provided false information to persuade one particular investor to invest $2 million in the Overage Program. They then used this money to make payments to existing program investors.
When GCA had difficulty making timely payments to Overage Program investors, MacDonald authorized Solomon to respond to investor complaints and inquiries with excuses for the delayed payments. Solomon sent these emails from accounts that were created for fictitious GCA employees.
The Overage Program did not generate any income or revenue. Less than 50 people actually bought any healthcare policies during the lifetime of the program. MacDonald and Solomon admit that any payments made to existing investors came from money that GCA received from new investors in the program.
In a parallel action, both defendants are also charged by the U.S. Securities and Exchange Commission (SEC) with securities fraud and conducting an unregistered securities offering while acting as unregistered broker-dealers. That complaint alleges that GCA had raised nearly $10 million from investors and returned about $2 million to investors in the form of Ponzi payments.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, which was established in 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 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 nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit http://www.stopfraud.gov/.
The case is being investigated by the FBI. The U.S. Attorney’s Office also appreciates the assistance of the SEC’s Fort Worth Regional Office. Special Assistant U.S. Attorney Ruben Martinez, Jr. is in charge of the prosecution.
Terrytown Man, Warren Stewart, Charged with Recording Movies in A Local Theater and Criminal Infringement of A CopyrightRead the Press Release
WARREN STEWART, age 37, a resident of Terrytown, Louisiana, was charged in a two-count Bill of Information with unauthorized recording of a motion picture and criminal infringement of a copyright, announced United States Attorney Dana J. Boente.
According to the Bill of Information, on January 27, 2013, STEWART used a digital camcorder to record the motion picture Broken City at the AMC Westbank Palace, located in Harvey, Louisiana. The Bill of Information also charges that until March 6, 2013, STEWART knowingly and willfully, for the purpose of commercial advantage and private financial gain, infringed the copyright of copyrighted works by distributing ten or more copies of the works during a 180-day period, which had a total retail value in excess of $2,500.
If convicted, STEWART faces a maximum term of imprisonment of not more than three years as to Count 1 and five years as to Count 2, followed by up to three years of supervised release, and a $250,000 fine.
United States Attorney Boente reiterated that the Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
The case was investigated by Immigration and Customs Enforcement, Homeland Security Investigations. The case is being prosecuted by Assistant United States Attorney Jordan Ginsberg.
(Download Bill of Information )
Snohomish County Gun Trafficking Group IndictedRead the Press Release
Four members of a gun trafficking conspiracy based in Snohomish County, Washington are under arrest after being indicted by the grand jury for illegally selling more than 50 firearms to an undercover investigator, announced U.S. Attorney Jenny A. Durkan. HEATHER CHANCEY, a/k/a HEATHER LEE SLATER, 34, of Marysville, Washington, is charged in 14 counts of a 20 count indictment for gun and drug crimes. MARK JENKINS, 53, of Marysville, Washington, is charged in four counts of being a felon in possession of a firearm, and JAMES MICHAELS, 37, of Marysville, Washington, and CURTIS VAN PUTTEN, 43, of Marysville, Washington, are each charged in one count of being a felon in possession of a firearm. The four were arrested this morning and will make their initial appearances in U.S. District Court in Seattle at 1:30 today.
“These defendants, convicted felons, were selling dozens of high powered firearms with no sales record and no concern about where these guns would end up,” said U.S. Attorney Jenny A. Durkan. “Our region has seen too much heartache come out of the end of guns. Law enforcement will continue to work together to stop the illegal flow of guns into our communities.”
According to the indictment, on multiple occasions between October 2012 and January 2013, HEATHER CHANCEY and her coconspirators sold guns to an undercover law enforcement agent. Most of the sales occurred in the parking lot of the Tulalip Resort Casino in Marysville, Washington. Some of the sales occurred in other parking lots of businesses in Marysville or Arlington, Washington or at a Marysville residence. CHANCEY was prohibited from possessing firearms because of a 2001 conviction for methamphetamine possession. Some of the guns she possessed and sold in this case include: two sawed off shotguns and 13 regular shotguns – some with no visible serial numbers; 21 rifles – some with obliterated serial numbers; and four handguns. CHANCEY is also charged with distribution of methamphetamine and possession of a firearm in furtherance of a drug trafficking crime. JENKINS, who has a prior felony conviction in Oregon, is charged with illegally possessing five rifles and two handguns. MICHAELS has a 2000 drug possession conviction, and is accused of illegally possessing a rifle. CURTIS VAN PUTTEN has prior convictions for drug possession and possession of stolen property and is alleged to have illegally possessed three rifles.
“Ms. Chancey blatantly disregarded the safety of her community by distributing dangerous items indiscriminately,” said Special Agent-in-Charge Laura M. Laughlin of the FBI Seattle office. “Further, she often did so in broad daylight, in areas where we all live and play with our families. The FBI welcomed the opportunity to work with our law enforcement partners to disrupt this brazen activity.”
“Our communities are safer when you take illegal weapons and drugs off the street. A potentially dangerous and harmful element has been removed from Snohomish County as a result of this collaborative investigation between federal, state and local agencies,” said Snohomish Regional Gang and Drug Task Force Commander Pat Slack.
“Working together, law enforcement cracked a crime ring that was trafficking handguns, rifles and weapons that could be altered for fully automatic firing,” said Seattle Police Chief Jim Pugel. “I can say with confidence that Seattle is safer with these weapons and their dealers off the streets.”
Conspiracy to unlawfully deal in firearms and illegal distribution of firearms are punishable by a term of imprisonment of up to five years and a $250,000 fine. Being a felon in possession of a firearm is punishable by up to ten years in prison and a $250,000 fine. Distribution of fifty grams or more of methamphetamine is punishable by a mandatory sentence of five years in prison, and up to forty years in prison. Possession of a firearm in furtherance of a drug trafficking crime is punishable by a mandatory additional consecutive sentence of five years in prison.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
This investigation was conducted by the Snohomish Regional Gang and Drug Task Force, the Seattle Police Department, and the FBI. During the investigation, those agencies were assisted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Snohomish County Violent Offender Task Force and the United States Marshal’s Violent Offender Task Force. The case is being prosecuted by Assistant United States Attorney Kate Crisham.
Shell Oil to Spend over $115 Million to Reduce Harmful Air Pollution at Houston Area Refinery and Chemical PlantRead the Press Release
The Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today that Shell Oil and affiliated partnerships (Shell) have agreed to resolve alleged violations of the Clean Air Act at a large refinery and chemical plant in Deer Park, Texas, by spending at least $115 million to control harmful air pollution from industrial flares and other processes, and by paying a $2.6 million civil penalty. Shell has agreed to spend $1 million on a state-of-the-art system to monitor benzene levels at the fenceline of the refinery and chemical plant near a residential neighborhood and school and to make the data available to the public through a website.
Shell will spend $100 million on innovative technology to reduce harmful air pollution from industrial flares, which are devices used to burn waste gases. Shell is required to take the following actions to improve flaring operations: minimize flaring by recovering and recycling waste gases (which may then be reused by Shell as a fuel or product); comply with limitations on how much waste gas can be burned in a flare (flare caps); and install and operate instruments and monitoring systems to ensure that gases that are sent to flares are burned with 98% efficiency. Shell’s agreement to recover and recycle waste gases (flare gas recovery) at its chemical plant is a first of its kind.
Once fully implemented, the pollution controls required by the settlement will reduce harmful air emissions of sulfur dioxide, volatile organic compounds (VOCs) including benzene, and other hazardous air pollutants by an estimated 4,550 tons or more per year. These controls will also reduce emissions of greenhouse gases by approximately 260,000 tons per year.“This settlement will result in substantial reductions in toxic air pollution through state of the art technology and increased efficiencies at the Deer Park plant,” said Acting Assistant Attorney General Robert G. Dreher of the Justice Department’s Environment and Natural Resources Division. “This agreement will bring Shell Oil’s refinery and chemical plant in Deer Park into compliance with the nation’s Clean Air Act and result in cleaner, healthier air for residents in the local communities for many years to come.”
“The innovative emission controls required by today’s settlement will cut harmful air pollution in communities near Houston,” said Cynthia Giles, Assistant Administrator of EPA’s Office of Enforcement and Compliance Assurance. “This case is part of EPA’s nationwide enforcement effort to protect fenceline neighborhoods by significantly reducing toxic pollution from flares and making information about pollution quickly available to affected communities.”
The settlement was filed at the same time the Justice Department filed a complaint on behalf of EPA alleging, among other things, that the company improperly operated its 12 steam-assisted flaring devices in such a way that excess VOCs, including benzene and other hazardous air pollutants, were emitted.
In addition to reducing pollution from flares, Shell will significantly modify its wastewater treatment plant; replace and repair tanks as necessary; inspect tanks biweekly with an infrared camera to better identify potential integrity problems that may lead to leaks; and implement enhanced monitoring and repair practices at the benzene production unit. When fully implemented, these specific projects are estimated to cost between $15 and $60 million.
Also, in a second project to benefit the community, Shell has agreed to spend $200,000 on retrofit technology to reduce diesel emissions from government-owned vehicles which operate in the vicinity of the Deer Park complex.
These actions will cut emissions of pollutants that can cause significant harm to public health. Exposure to high concentrations of sulfur dioxide can affect breathing and aggravate existing respiratory and cardiovascular disease. VOCs are a key component in the formation of smog or ground-level ozone, a pollutant that irritates the lungs, exacerbates diseases such as asthma, and can increase susceptibility to respiratory illnesses, such as pneumonia and bronchitis. Chronic exposure to benzene, which EPA classifies as a carcinogen, can cause numerous health impacts, including leukemia and adverse reproductive effects in women.
Today’s settlement is part of EPA’s national effort to reduce emissions toxic air pollutants, with a particular focus on industrial flares. These requirements focus on reducing the amount of waste gas sent to flares and on improving flare operations, both of which work to reduce toxic emissions. Improper operation of an industrial flare can send hundreds of tons of hazardous air pollutants into the air. The more waste gas a company sends to a flare, the more pollution occurs. The less efficient a flare is in burning waste gas, the more pollution occurs. EPA wants companies to flare less, and when they do flare, to fully burn the harmful chemicals found in the waste gas.
Shell, which is headquartered in Houston, processes approximately 330,000 barrels per day of crude oil at its Deer Park facility, making it the 11th largest refinery in the United States. In addition, the Deer Park chemical plant produces approximately 8,000 tons per day of products that include ethylene, benzene, toluene, xylene, phenol, and acetone. Both the chemical plant and the refinery operate 24 hours a day, 365 days a year.The consent decree, lodged in federal court in the Southern District of Texas, is subject to a 30-day public comment period and court approval. The consent decree will be available for viewing at www.justice.gov/enrd/Consent_Decrees.html.
More information about the settlement: www.epa.gov/enforcement/air/cases/sdp.html
More information about EPA’s Air Toxics National Enforcement Initiative: www.epa.gov/compliance/data/planning/initiatives/2011airtoxics.html
Prior enforcement settlements related to industrial flaring:
BP North America: www.epa.gov/compliance/resources/cases/civil/caa/bp-whiting.html
Marathon Petroleum Company: yosemite.epa.gov/opa/admpress.nsf/2467feca60368729852573590040443d/e841a5bbc6dd1082852579d7005b6347!OpenDocument&Highlight=2,Marathon
CountryMark Refining and Logistics: yosemite.epa.gov/opa/admpress.nsf/2467feca60368729852573590040443d/b511e565ba2af7f985257b20005cb737!OpenDocument&Highlight=2,CountryMark
Enforcement Alert: EPA Enforcement Targets Flaring Efficiency Violations (August 2012): www.epa.gov/enforcement/air/documents/newsletters/flaringviolations.pdf
Sarasota Tax Preparer Pleads Guilty to Preparing Fraudulent Tax Returns for Illegal AliensRead the Press Release
Tampa, Florida - Acting United States Attorney A. Lee Bentley, III announces that Fernando Torres (41, Sarasota) pleaded guilty today to aiding and assisting in the preparation and presentation of fraudulent tax returns. Torres faces a maximum penalty of six years in federal prison.
According to the plea agreement, Torres operated a tax preparation business in Sarasota. Torres’ tax preparation business catered mostly to an illegal immigrant population in and around Sarasota County. During 2011 and 2012, Torres prepared and filed 239 fraudulent tax returns with the Internal Revenue Service, on behalf of his illegal immigrant clients. Torres ensured that his clients obtained refunds by falsely claiming that they had one or more qualified dependents, when in fact, they did not. In order to increase the amount of refunds received by his clients, Torres also fraudulently claimed the Additional Child Tax Credit for them.
As a result of Torres’ conduct, the IRS paid out $697,573.00 in tax refunds. Had Torres completed the returns accurately and legitimately, most of his clients would have owed money to the IRS.
This case was investigated by the Internal Revenue Service Criminal Investigation, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the U.S. Department of Agriculture, and the Sarasota Police Department. It is being prosecuted by Assistant United States Attorney Simon Gaugush.
San Luis Methamphetamine Trafficker Sentenced to 20 YearsRead the Press Release
PHOENIX – On July 8, 2013, Indalecio Castro-Ponce, 40, of San Luis, Ariz. was sentenced by U.S. District Judge Susan R. Boltonto 240 months imprisonment and a $3,000 fine. Castro-Ponce was found guilty by a federal jury on April 12, 2013, of one count of conspiracy to possess with intent to distribute methamphetamine and two counts of possession with intent to distribute methamphetamine
“We place a very high priority on the prosecution of those like Castro-Ponce who cause the ruin of so many lives by spreading the poison of methamphetamine in our communities,” said U.S. Attorney John S. Leonardo. “We will continue to do all that we can to hold such people accountable for their actions.”
“I commend the dedicated investigative work of HSI special agents and our law enforcement partners in Arizona and across the Western U.S.,” said Matt Allen, special agent in charge of ICE Homeland Security Investigations (HSI) Arizona. “Thanks to their efforts, this meth trafficker will spend 20 years in federal prison. This strong sentence should serve as a deterrent to those who would seek to profit by bringing dangerous, highly-addictive drugs into our neighborhoods.”
The evidence at trial showed that Castro-Ponce conspired with others, including his wife and teenaged son, to distribute methamphetamine on more than 20 occasions to various locations in the Southwestern United States, including Salt Lake City, Utah; Las Vegas, Nev.; Fresno, Calif.; Sunland, Calif.; and Moreno Valley, Calif. Following visits by Castro-Ponce, law enforcement seized more than three pounds of 96% pure “ice” methamphetamine from a location in Fresno, Calif., and more than seven pounds of methamphetamine from a location in Moreno Valley, Calif., along with more than $200,000 cash. Castro-Ponce, a first-time offender, received sentencing enhancements for having involved his minor children in his drug trafficking activities, being a leader and organizer of a drug trafficking organization, and obstructing justice by committing perjury under oath at trial.
The investigation in this case was conducted by U.S. Customs and Enforcement (ICE) Homeland Security Investigations (HSI) in Yuma, Ariz., with assistance from HSI-Fresno, HSI-Riverside County, HSI-Salt Lake City, HSI-Las Vegas, and HSI-Phoenix, the Drug Enforcement Administration, the Federal Bureau of Investigation, the LA-IMPACT Task Force, the INCA Task Force, and the Fresno County Sheriff’s Office. The prosecution was handled by Krissa Lanham and William Bryan, Assistant U.S. Attorneys, District of Arizona, Phoenix.
CASE NUMBER: CR-12-1363-PHX-SRB
RELEASE NUMBER: 2013-054_ Castro-PonceFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
SW Washington Repeat Offender Sentenced to more than Seven Years in Prison for Gun and Drug CrimesRead the Press Release
A repeat offender who repeatedly distributed meth while armed with a firearm was sentenced yesterday to seven and a half years in prison, announced U.S. Attorney Jenny A. Durkan. In December 2011, LANDON KUSH, 34, was arrested at a Vancouver, Washington motel with methamphetamine packaged for distribution and a loaded Browning, .25 caliber, semi-automatic pistol stored in the trunk of his car. Kush was charged in Clark County Superior Court and released on Abail. Even as those charges were pending KUSH returned to drug dealing. On January 5, 2012, officers found meth in a car that Kush abandoned after an accident. When he was arrested on federal charges in February 2012, a search of his hotel room revealed a loaded Glock .45 caliber pistol. At sentencing U.S. District Judge Ronald B. Leighton said KUSH had the longest criminal record he had seen, calling him a “dangerous, dangerous man” and a “persistent criminal.”
According to records filed in the case, KUSH already had convictions for robbery, eluding police and dealing drugs when he was taken into custody in December 2011.
KUSH pleaded guilty at his sentencing hearing to Possession of a firearm during and in relation to a drug trafficking crime, and Possession of methamphetamine with intent to distribute.The case was investigated by the SWIGET (Southwest Integrated Gang Enforcement Team), which is made up of officers and agents of the FBI, Vancouver Police Department (VPD), Clark County Sheriff’s Department and the Washington State Department of Corrections. SWIGET was formed to combat violent gang crime in the Vancouver, Washington area.
The case was prosecuted by Assistant United States Attorneys Michael Dion and Thomas Woods.
Rossford Man Charged with Imperonating ATF Special AgentRead the Press Release
An indictment was filed charging Brent North, age 47, of Rossford, Ohio, with with creating false federal law enforcement credentials and impersonating a federal law enforcement agent, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
On Jan. 14, 2011, North produced a false credentials identifying himsealf as a Special Agent of the Bureau of Alcohol, Tobacco, Firearms and Explosives, according to the indictment.
On Dec. 8, 2012, North falsely stated he was a Special Agent of the Bureau of Alcohol, Tobacco, Firearms and Explosives on consequently received favorable lease terms on a residential property in Oregon, Ohio, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigating agency in this case is the Bureau of Alcohol, Tobacco, Firearms and Explosives, Toledo, Ohio. The case is being handled by Assistant United States Attorney Gene Crawford.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Rochester Man Sentenced on Gun ChargeRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul Jr. announced today that Johnny L. Wynn, II, 31, of Rochester, N.Y., who was convicted of possession of a sawed off shotgun, was sentenced to 70 months in prison by U.S. District Judge Charles J. Siragusa.
The sentencing was the culmination of an investigation on the part of Special Agents of the Bureau of Alcohol Tobacco, Firearms and Explosives, under the direction of Scott Heagney, Resident Agent in Charge and the Rochester Police Department, under the direction of James Sheppard
Assistant U.S. Attorney Charles E. Moynihan, who handled the case, stated that Wynn, a convicted felon, possessed a 12 gauge, Revelation Model 312 bolt action shot gun. During an undercover investigation into the illegal trafficking of firearms, an undercover law enforcement officer purchased the shotgun along with a 9mm rifle from Wynn for $1,000.00 in cash. The sale occurred on April 16, 2009, inside of a vehicle outside the defendant’s residence on Cutler Street in Rochester.Rapid City Man Sentenced for EscapeRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City, South Dakota man convicted of Escape was sentenced on July 8, 2013 by Chief Judge Jeffrey L. Viken, U.S. District Court.
Floyd Bullman, age 41, was sentenced to time served and ordered to pay $100 to the Federal Crime Victims Fund.
On November 5, 2012, Bullman walked away and failed to return to Community Alternatives of the Black Hills, where he was serving part of a federal sentence. He pled guilty on March 8, 2013.
This case was investigated by the U.S. Marshals Service. Assistant U.S. Attorney Eric Kelderman prosecuted the case.
# # #Raleigh Co. Man Indicted by Federal Grand Jury on Illegal Firearm Possession ChargesRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that a Raleigh County man was indicted on July 9 by a federal grand jury sitting in Beckley on illegal firearm possession charges. Cameron Martin Taylor, 24, of Shady Spring, Raleigh Co., W.Va., was charged with being a felon in possession of a firearm and possession of a stolen firearm. According to a two-count indictment, on April 24, 2013, Taylor allegedly possessed an AR-50 rifle near White Oak, Raleigh Co., W.Va. The indictment also alleges that Taylor knew and had reasonable cause to believe that the firearm he possessed at the time was stolen.
Taylor was previously convicted of grand larceny, daytime burglary, and nighttime burglary in April 2010 in the Circuit Court of Raleigh County. He did not have his rights to possess a firearm restored.
Taylor faces up to 10 years in prison on each count if convicted.The investigation was conducted by the West Virginia State Police. Assistant United States Attorney John File is in charge of the prosecution.
The case is being brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
Note: The charges contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Click here to view a copy of the indictment
Parmelee Man Charged with Assaulting, Resisting, Opposing and Impeding A Federal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Parmelee, South Dakota, man has been indicted by a federal grand jury for Assaulting, Resisting, Opposing, and Impeding a Federal Officer.
William Rahn, age 27, was indicted by a federal grand jury on May 16, 2013. He appeared before U.S. Magistrate Judge Mark A. Moreno on July 8, 2013, and pled not guilty to the indictment.
The maximum penalty upon conviction is up to 20 years in custody, a $250,000 fine, or both; 3 years of supervised release; and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The charge is merely an accusation and Rahn is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Tim Maher is prosecuting the case.
Rahn was released to a third party custodian pending trial. A trial date has not been set.
###Numerous Attorneys, Mortgage Brokers, Real Estate Professionals, and Devleopers Face Prison Time in Connection with Multiple Mortgage Fraud Schemes Uncovered in Eastern North CarolinaRead the Press Release
RALEIGH – The United States Attorney’s Office announced the unsealing of numerous federal cases and other court actions involving attorneys, mortgage brokers, real estate professionals, and developers, who are charged with federal crimes pertaining to mortgage fraud.
“Mortgage fraud impacts families and devastates neighborhoods. The FBI is committed to protecting our nation’s economy by aggressively investigating those who attempt to undermine the financial stability of our housing market,” said John Strong, Special Agent in Charge of the Charlotte Division of the FBI.
“The Federal Deposit Insurance Corporation - Office of Inspector General is committed to its partnerships with others in the law enforcement community as we address mortgage fraud cases throughout the country. The American people need to be assured that their government is working to ensure integrity in the financial services and housing industries and that those involved in criminal activities that undermine that integrity will be held accountable,” commented the Federal Deposit Insurance Corporation Inspector General Jon T. Rymer.
“We recognize the negative impact that mortgage fraud has on our economy and on our communities. With actions like those announced today, a very clear message is sent: if you don’t operate within the boundaries of the law, we will not hesitate to act. We will continue to work with our law enforcement partners to ensure the US Mail is safe and not used to further schemes like this”, said Inspector in Charge Keith Fixel, US Postal Inspection Service.
HUD-OIG Special Agent in Charge Lester Fernandez said: “We are especially committed to aggressively pursuing mortgage and real estate professionals who instead of honoring their fiduciary responsibilities, abuse their positions and cause harm to FHA’s mortgage insurance programs. HUD-OIG is committed to working cooperatively with our law enforcement partners to bring these individuals to justice and protect the integrity of our programs.”
“IRS Criminal Investigation is committed to uncovering fraud and abuse in all facets of the housing market – a market upon which so many American families have pinned their hopes and their futures for so many years," said Special Agent in Charge, Jeannine A. Hammett, Charlotte Field Office. "Partnering with the United States Attorney’s Office and other federal agencies, IRS Criminal Investigation is committed to combating mortgage fraud and other financial crimes to protect the American homeowner and the national economy."
Each of the following cases is being prosecuted by the Economic Crimes Section of the United States Attorney’s Office as a part of its Mortgage Fraud Task Force which was created in June of 2010. The investigation of these cases has been jointly conducted by various agencies, including the Federal Bureau of Investigation (FBI), the United States Department of Housing and Urban Development Office of the Inspector General (HUD-OIG), the Internal Revenue Service Criminal Investigation (IRS-CI), the United States Postal Inspection Service, the Federal Deposit Insurance Corporation - Office of the Inspector General (FDIC-OIG) and the Raleigh Police Department. Assistant United States Attorney William M. Gilmore represents the United States in each of these matters.
- TRIPLE-R ENTERPRISES ET AL. INVESTIGATION
- EZN HOMES / PREMIER PROPERTIES INVESTIGATION
- ALPINE PROPERTIES, ET AL. INVESTIGATION
- RBR CAPITAL ET AL. INVESTIGATION
Chief United States District Judge James C. Dever ordered the unsealing today of the cases against mortgage broker DEXTER TIRRELL JONES, 42 of Raleigh; developer RICKY LAMONT CONGLETON, 43, of Zebulon; closing attorney PHILLIP GRAHAM ROSE, 42 of Raleigh; developer VINCENT MALDINI, 46, of Seabright, New Jersey; and developer JOHNNY RAY PEELE, 43, of Wake Forest. The United States Attorney’s Office also announces the filing of criminal charges against JOSEPH CARL HOLLIS, 35, of Raleigh; developer DWAYNE THOMAS HALL, 49, of Wake Forest, and former real estate broker, TRESHELL MAYO HERNDON, 39, of Raleigh. JONES, CONGLETON, ROSE, MALDINI, PEELE, HALL, and HERNDON, are each charged in a one-count criminal information with Conspiracy to Commit Bank and Wire Fraud (and in some instances, also Conspiracy to Commit Mail Fraud), in violation of Title 18, United States Code, Section 1349, which carries a maximum penalty of 30 years in prison and a $1 million fine, or twice the gain or loss from the conspiracy, whichever is greater. HOLLIS is charged with Conspiracy to Commit Mail, Wire, and Bank Fraud, in violation of Title 18, United States Code, Section 371, which carries a maximum penalty of up to 5 years in prison and a fine of up to $250,000, or twice the gain or loss from the conspiracy, whichever is greater.
The charging documents collectively allege that between 2003 and 2009, CONGLETON, HERNDON, PEELE, HALL, MALDINI, JONES, HOLLIS, ROSE, and others known to the United States Attorney, were involved in a conspiracy to defraud numerous banks and lenders in the United States, resulting in mortgage loan disbursements exceeding $20 million, $5 million in loan proceeds, and losses exceeding $1 million. The conspiracy further resulted in substantial losses to the United States Department of Housing and Urban Development (HUD) through its Federal Housing Administration (FHA) program.
The charging documents indicate that various developers in the scheme, including but not limited to CONGLETON, operating through Triple R Enterprises, LLC; HERNDON, operating through Herndon & Herndon Enterprises, LLC; HALL, operating through Dwayne T. Hall Builders; PEELE, operating through P.A.P’s Custom Home Builders, LLC and C and P Custom Homes, LLC; and MALDINI, operating through NY Construction, LLC, unlawfully profited from the sale of properties purchased or developed by the conspirators to individuals who did not have the financial means to purchase the properties, identified in the charging documents as “straw buyers”. To execute the scheme, CONGLETON, HERNDON, HALL, PEELE, MALDINI, and others involved in the scheme referred to as “Builders”, would cause entities owned or controlled by them to purchase and develop a property for quick resale. The builders caused individuals, referred to herein as “Intermediaries”, to locate individuals who were willing to allow their name and credit to be used to purchase properties from the Builders. The Intermediaries, including but not limited to HOLLIS, MALDINI and then mortgage broker, JONES, assisted the straw buyers to complete a loan application with a lender. For their services to the Builders, the conspirators paid the Intermediaries a kickback, or lump sum of cash, from the loan proceeds used by the straw buyers to purchase the properties from the Builders.
Conspirators enticed the straw buyers to participate in the scheme by making certain promises and representations including, but not limited to the following: (1) The straw buyers would be paid a sum of cash for purchasing the properties, (2)the straw buyers would not be required to make a down payment, (3) the straw buyers were told that the homes would be rented and the rental income would be used to pay the mortgage,(4) the straw buyers would not be required to make interest payments on the mortgage loans utilized to purchase the properties from the Builders.
CONGLETON, HERNDON, HALL, PEELE, MALDINI, and other Builders executed contracts to sell properties to the straw buyers for their appraised value, but set aside 15 to 20% of the sales price to use as the straw buyer’s down payment, and to pay kickbacks to the straw buyers and others participating in the scheme. The Builders further obtained and caused others to obtain cashier’s checks from accounts owned or controlled by the Builders to cover the down payment obligations of the straw buyers. The cashier’s checks were written to make it appear to lenders and banks that the straw buyers were providing the down payment funds when, in fact, such funds came from the Builders. These cashier’s checks were given to a closing attorney who handled the sale of the property from the Builder to the straw buyer.
Raleigh attorney PHILLIP GRAHAM ROSE served as the closing attorney on some, but not all, real estate transactions between Builders and straw buyers that were funded by banks and mortgage lenders in the scheme. In connection with the transactions involving the Builders and straw buyers, ROSE created and executed, and had the buyers and sellers execute, HUD-1 settlement statements that falsely indicated that the borrower brought cash to the closing when, in fact, as ROSE knew, the cash was provided by the Builders, including CONGLETON, HERNDON, HALL, PEELE, MALDINI, and others. ROSE and his staff transmitted the false HUD-1 settlement statements via mail and interstate wires to banks and mortgage lenders who relied upon them in funding the transactions. The Builders and straw buyers executed the HUD-1 settlement statements reflecting that the straw buyers were making the down payment on the properties, when in fact, the down payments were made by the Builders.
Because of the foregoing actions, banks and other lenders were deceived into disbursing loan proceeds to fund the purchase of the properties from CONGLETON, HERNDON, HALL, PEELE, MALDINI, and other Builders. The banks and lenders issued loans they either would not otherwise have made, or issued loans on terms they would not otherwise have authorized, had the Builders and others not concealed the true terms of the transactions, the actual qualifications and intentions of the straw buyers, the promises and representations made by the Builders and others to the straw buyers, and the false down payments of the straw buyers as reflected on the HUD-1 settlement statements.
Rental income was collected and sometimes not forwarded to pay the mortgage, as promised. The Builders also did not always make interest payments on loans issued to the straw buyers. As a result of the scheme, straw buyers were left accountable for loans that they did not have the financial means to repay, and banks were forced to initiate foreclosure proceedings and sell the properties at a loss.
In an effort to recover losses associated with the scheme, the United States Attorney’s Office, with the cooperation of the various federal agencies participating in the Mortgage Fraud Task Force, and the United States Marshal’s Service, has seized or encumbered various parcels of real property and other property in North Carolina deemed to be forfeitable to the United States as criminal proceeds of the offense.
ROSE, JONES, CONGLETON, and MALDINI have each admitted their their role in the scheme and are awaiting sentencing, anticipated to occur later in 2013. PEELE is scheduled to appear on the charges on July 15, 2013. HERNDON, HALL, and HOLLIS are each scheduled to appear on the charges on August 19, 2013.
The investigation of this matter is ongoing and anyone with knowledge is encouraged to contact the FBI at (704) 672-6100. If you believe that you are a victim in connection with this investigation please contact the Victim/Witness Coordinator for the United States Attorney’s Office at (919) 856-4003.
Chief United States District Judge James C. Dever ordered the unsealing today of the cases against real estate developers DAVID LEWIS JOHNSON, 39 of Cary, and ARTHUR LEE BARNES, JR., 46 of Rocky Mount. The BARNES and JOHNSON cases are related to the pending cases against real estate agent MARK TKAC, 47, of Raleigh, former mortgage broker MARK THOMAS BOWE, 56, of Jonesboro, Georgia, LILLIANA DELIA DEIAC, 43, of Jamaica, New York, and the recently concluded case against closing attorney JEFFERY SCOTT TAGGART, 48, of Winterville. JOHNSON, BARNES, and TKAC, were each charged in a one-count criminal information with Conspiracy to Commit Mail, Wire, and Bank Fraud, in violation of Title 18, United States Code, Section 1349, which carries a maximum penalty of 30 years in prison and a $1 Million fine. TAGGART was charged with Conspiracy to Commit Mail, Wire, and Bank Fraud, in violation of Title 18, United States Code, Section 371, which carries a maximum penalty of 5 years in prison and $250,000 in fines, and Subscribing to a False Income Tax Return in violation of Title 26, United States Code, Section 7206(1), which carries a maximum penalty of 3 years in prison and a $100,000 fine, plus costs of prosecution. BOWE was charged in an indictment with Conspiracy to Commit Wire and Bank Fraud, in violation of Title 18, United States Code, Section 1349; Bank Fraud, in violation of Title 18, United States Code, Section 1344; Wire Fraud, in violation of Title 18, United States Code, Section 1343; and Making False Statements to Federally Insured Financial Institutions, in violation of Title 18, United States Code, Section 1014; all of which carry a maximum penalty of 30 years in prison and a $1 Million fine.
The criminal informations for JOHNSON, BARNES, TKAC, and TAGGART collectively allege that between September of 2002 and May of 2008, JOHNSON, BARNES, TKAC, and TAGGART entered into an agreement to defraud banks and home mortgage lenders located throughout the United States. The charges indicate that JOHNSON, operating through EZN Homes, Inc., BARNES, operating through Premier Investments, Inc., and TKAC recruited investors, who were in fact “straw buyers,” to secure home mortgage loans under the guise of an investment plan. The straw buyers allowed the conspirators to use their name and credit to purchase properties and obtain loans from banks and mortgage lenders. The straw buyers lacked the financial means to service the debt on the loans acquired in their names. The straw buyers also did not have a long-term interest in the properties that the conspirators caused to be purchased in their names. The conspirators induced the straw buyers to allow their name and credit to be used by making various representations, including, but not limited to, the promise of a cash kickback from the loan proceeds disbursed at the time of the real estate closing.
TKAC, a licensed real estate broker at the time, participated in the conspiracy first by acting as a straw buyer, and later recruiting others to serve as straw buyers to facilitate the scheme by JOHNSON and BARNES.
The conspirators directed straw buyers to conduct the real estate closings with co-conspirator attorney TAGGART. TAGGART prepared false HUD-1 settlement statements for execution by the straw buyers as a part of the real estate closing and loan funding process. TAGGART then caused the HUD-1 settlement statements to be transmitted via mail and wire to banks and mortgage lenders, including FDIC regulated financial institutions, under the pretense that they reflected the economic truth of the underlying transaction.
In fact, however, the HUD-1 settlement statements prepared by TAGGART as a part of the scheme routinely contained false statements that were material to the lenders' funding decisions including, but not limited to: the existence and degree of the buyer's down payment, the actual contract price for the property, the rightful owner of the real estate specific to the transaction, and the true recipient of all loan proceeds disbursed by banks pursuant to the real estate closing.
The various banks and mortgage lenders who issued loans related to the mortgage fraud scheme were deceived by the use of straw buyers, in addition to the foregoing false and fraudulent statements made by JOHNSON, TAGGART, and other co-conspirators in connection with the loan closings. As a result of the scheme, lenders issued several million dollars in loans, a substantial portion of which are in default or foreclosure.
JOHNSON, BARNES, and TKAC each admitted their role in the scheme and are awaiting sentencing. TAGGART was previously sentenced on April 17, 2013, to 36 months in prison, followed by three years of supervised release for his role in the offense. JOHNSON, BARNES, and TKAC are scheduled to be sentenced in October of 2013 by Chief Judge Dever in Raleigh.
BOWE was indicted on April 4, 2013 for, among other things, Conspiracy to Commit Wire and Bank Fraud. The indictment alleges that BOWE, a former mortgage broker operating through New Equity Mortgage, LLC and Anna Mortgages, LLC, participated in the scheme by falsifying various aspects of loan applications including, but not limited to, the amount and source of income and assets of borrowers, the existing debts of borrowers, and borrowers’ intent to occupy the property being purchased as the borrower’s primary residence. It is also alleged that BOWE and another promoted the scheme by supplying false verifications of deposit and false account statements purporting to show that borrowers held assets with “Mutual Southern Investments”, when in fact Mutual Southern Investments did not exist, and the assets were entirely fictitious. BOWE’s arraignment is presently scheduled for Chief Judge Dever’s August 5, 2013 term of court.
DEIAC was indicted on April 4, 2013 for Making False Statements to a Federally Insured Financial Institution, and Making Material False Statements to the FBI. The indictment alleges that DEIAC forged her husband’s name and credit information without his knowledge on a $1,950,000 loan from Wells Fargo Bank for her purchase of 1016 Clear Creek Farm Drive in Raleigh. The indictment further alleges that DEIAC falsely told the FBI that she believed she was leasing a building in New York when she executed loan and closing documents for the Clear Creek Farm property. DEIAC is scheduled to be arraigned on the charges against her at Chief Judge Dever’s August 5, 2013 term of court in Raleigh.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent unless and until proven guilty in court.
The investigation of this matter is ongoing and anyone with knowledge is encouraged to contact IRS-CI at (910) 254-5150. If you believe that you are a victim on connection with this investigation please contact the Victim/Witness Coordinator for the United States Attorney’s Office at (919) 856-4003.
The United States Attorney’s Office also announces that former Raleigh developer JAMES THOMAS WEBB, 52, of Miami, is presently scheduled to be sentenced in August of 2013 by Chief United States District Judge James C. Dever in Raleigh. WEBB was indicted on charges of Conspiracy to Commit Bank and Wire Fraud, in violation of Title 18, United States Code, Section 1349; 10 counts of Bank Fraud and Aiding and Abetting, in violation of Title 18, United States Code, Sections 1344 and 2; 3 counts of Wire Fraud and Aiding and Abetting, in violation of Title 18, United States Code, Sections 1343 and 2; and 36 counts of Making False Statements to Influence Banks on Loans and Aiding and Abetting, in violation of Title 18, United States Code, Sections 1014 and 2. On March 18, 2013, WEBB pleaded guilty to the offense of Conspiracy to Commit Wire and Bank Fraud, the maximum punishment for which is 30 years in prison and up to $1,000,000 in fines, or twice the gain or loss arising from the offense, whichever is greater.
WEBB’s case relates to the pending cases against former closing attorney AMY ROBINSON, 35, of Rolesville, former real estate appraiser, JACKIE GALE WEAVER, 55, of West Hamlin, West Virginia, and former national appraisal instructor, LARRY MAX MCDANIEL, 71, of Vienna, West Virginia, who have each pleaded guilty to their roles in the scheme. ROBINSON faces up to five years in prison and a $250,000 fine on the charge of Conspiracy to Commit Mail, Wire, and Bank Fraud, in violation of Title 18, United States Code, Section 371. WEAVER faces up to five years in prison and a $250,000 fine for Conspiring to Make False Statements on Loans in violation of Title 18, United States Code, Section 371. MCDANIEL faces up to 30 years in prison and $1 Million fine for Making False Statements on Loans and Aiding and Abetting, in violation of Title 18, United States Code, Section 1014 and 2.
WEBB’s indictment charges that between 2002 and 2006, WEBB operated various real estate companies, including Alpine Properties, LLC and Webb Builders, LLC for a profit. WEBB promised investors in multiple states quick, large, and safe financial gains by investing money with him. WEBB promised investors that he would use their money to purchase, renovate, and resell properties to first-time home buyers in various states, including North Carolina, Virginia, and Tennessee. WEBB caused investors to take out loans on properties that he and his companies had allegedly renovated.
The indictment further alleges that despite alleged philanthropic and humanitarian objectives, that WEBB carried out a fraud upon both the investors who gave cash to WEBB, and the banks and lenders who WEBB caused to disburse loan proceeds. According to the indictment, WEBB conspired with former attorney, ROBINSON, to falsify closing statements associated with the loan transactions. It is alleged that the closing statements falsified various facts, including the amount of money paid to WEBB on the transactions. WEBB is also alleged to have conspired with a former appraiser and national appraisal instructor, MCDANIEL, and his associate, WEAVER, to falsify appraisal reports that were given to banks and lenders in connection with investor loans. The appraisal reports falsely stated that MCDANIEL had physically viewed the properties, when in fact he had not. The indictment also alleges that the properties sold to investors and financed by banks were not always completed or in the condition represented in the appraisal reports.
During the course of the scheme, the indictment charges that WEBB lived lavishly, residing in a multi-million dollar mansion, driving expensive vehicles including a Bentley, traveling extensively, and otherwise paying himself handsomely. WEBB is alleged to have abruptly left North Carolina for Florida in 2004, where he continued to market his services under new company names.
According to the indictment, based upon WEBB’s statements and representations to investors, various individuals collectively invested millions of dollars with WEBB and his companies. Additionally, banks and lenders are alleged to have disbursed millions of dollars in loans, leaving investors holding millions in debt. The indictment alleges that WEBB left various neighborhoods in North Carolina and Virginia blighted with boarded up and dilapidated homes, many of which were ultimately demolished as uninhabitable.
MCDANIEL, 71, pleaded guilty in federal court on June 11, 2012, to Making False Statements to Federally Insured Financial Institutions, and Aiding and Abetting. WEAVER pleaded guilty in federal court on September 21, 2011, to Conspiracy to Make False Statements to Federally Insured Financial Institutions. ROBINSON, 35, pleaded guilty in federal court on May 3, 2010, to conspiracy to commit mail, wire, and bank fraud. Sentencing in the cases of MCDANIEL, WEAVER, and ROBINSON, is presently scheduled at the same time as WEBB’s sentencing during Chief Judge Dever’s August 2013 term of court.
The investigation of this matter is ongoing and anyone with knowledge is encouraged to contact the FBI at (704) 672-6100. If you believe that you are a victim on connection with this investigation please contact the Victim/Witness Coordinator for the United States Attorney’s Office at (919) 856-4003.
The United States Attorney also announces the upcoming sentencings in August of 2013 for the pending cases against developer JUSTIN LEE ROOKS, 31, of Loris, South Carolina; developer MICHAEL THOMAS BARTLETT, 46, of Myrtle Beach, South Carolina; closing attorney ROBERT HAROLD MELVILLE, JR., 50, of Lake Waccamaw; and ANTHONY MICHAEL TEW, 31, of Conway, South Carolina. On December 11, 2012, ROOKS and BARTLETT pled guilty to Conspiracy to Commit Mail, Wire, and Bank Fraud, in violation of Title 18, United States Code, Section 1349. MELVILLE pled guilty to Conspiracy to Commit Bank and Wire Fraud, in violation of Title 18, United States Code, Section 1349. The charges against MELVILLE, ROOKS, and BARTLETT carry maximum penalties of 30 years in prison and up to $1 Million in fines or twice the gain or loss from the conspiracy, whichever is greater. On February 12, 2013, TEW pled guilty to Conspiracy to Commit Mail, Wire, and Bank Fraud, in violation of Title 18, United States Code, Section 371, which carries a maximum term of imprisonment of 5 years and up to $250,000 in fines.
The charging documents in these cases collectively allege that between May of 2004 and August of 2008, ROOKS, BARTLETT, and others conspired to defraud banks and lenders in connection with the purchase, development, and resale of properties in Columbus, Brunswick, and New Hanover counties. It is further alleged that the conspirators solicited individuals at seminars in Raleigh and elsewhere to allow construction loans to be obtained in their names for the benefit of the conspirators in exchange for cash. The conspirators told the buyers that the buyers would not have to make a down payment or interest payments on the loans, and that the properties purchased in their names would be sold within twelve months. TEW and other conspirators also posted signs which included such representations as, “easy financing” and “no down payment required,” even though the buyer/borrowers were generally required to make down payments at the time of the closings. The buyers were told that if properties could not be sold in twelve months, the conspirators would buy the properties back.
The conspirators in fact enticed the buyers to participate in the transactions and engaged in various actions to make it appear to the banks and lenders that the buyers were qualified for the loans. The charges allege that TEW and other conspirators deposited money into the bank accounts of the buyers to make it appear that they had sufficient assets to conduct the transactions. To close the loans, the conspirators also referred the buyers to MELVILLE, who was at that time a North Carolina attorney who practiced real estate law. MELVILLE participated in the conspiracy by engaging in actions that made it appear to the banks and lenders that the buyers had given down payment money at the time of closing when, in fact, the buyers did not bring such money.
The banks and lenders who loaned funds to the buyers were not informed of the cash kickbacks to the buyers by the conspirators. The banks and lenders were also not informed that the buyers did not in fact have the cash to close the transactions, and that the down payment money, if any, was provided by the conspirators.
Ultimately, according to the charging documents, the conspirators were unable to sell many of the properties purchased in the names of the buyers. The buyers did not have the means to repay all of the loans obtained in the names of the buyers and, as a result, many of the loans went into default. The banks and lenders were forced to sell the properties at a substantial loss.
The investigation of this matter is ongoing and anyone with knowledge is encouraged to contact IRS Criminal Investigation at (910) 254-5143. If you believe that you are a victim on connection with this investigation please contact the Victim/Witness Coordinator for the United States Attorney’s Office at (919) 856-4003.
New Haven Man Sentenced to More Than Eight Years in Federal Prison for Distributing CrackRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that JAMES JENKINS, also known as “Black,” 31, of New Haven, was sentenced yesterday by Senior United States District Judge Ellen Bree Burns in New Haven to 100 months of imprisonment, followed by four years of supervised release, for distributing crack cocaine.
This matter stems from a joint law enforcement investigation conducted by the FBI New Haven Safe Streets Task Force, the DEA New Haven Task Force, the New Haven Police Department and the Hamden Police Department. Through the use of court-authorized wiretaps, investigating officers identified and dismantled a large drug-trafficking organization that was centered in the Newhallville section of New Haven and Hamden, and was responsible for the distribution of crack cocaine and cocaine throughout the Greater New Haven area.
According to court documents and statements made in court, from June through October 2010, JENKINS was intercepted repeatedly over a wiretap ordering distribution quantities of crack cocaine from other members of the drug trafficking organization. He then sold the drug to his own customer base for profit.
On January 28, 2013, JENKINS pleaded guilty to one count of conspiracy to possess with intent to distribute cocaine base (“crack cocaine”).
Forty-seven individuals have been charged in federal court with various narcotics offenses as a result of this investigation. All have been convicted.
This matter was investigated by the Federal Bureau of Investigation’s New Haven Safe Streets Task Force (composed of members of members of the New Haven, Ansonia, Milford, Hamden and East Haven Police Departments, and the Connecticut State Police and the Connecticut Department of Correction), the Drug Enforcement Administration’s New Haven Task Force (composed of members of the New Haven, West Haven, Meriden, Ansonia, Hamden and Branford Police Departments), along with substantial participation by members of the New Haven and Hamden Police Departments. The United States Marshals Service also has assisted the investigation.
The investigation was funded in significant part by the United States Attorney’s Office Organized Crime Drug Enforcement Task Force and supported by the Office’s Project Safe Neighborhoods and Anti-Gang programs.
This matter is being prosecuted by Assistant United States Attorneys Christopher M. Mattei and Robert M. Spector.
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(203) 821-3722 [email protected]Mexican Citizen Convicted of Illegally Re-Entering the United StatesRead the Press Release
KNOXVILLE, Tenn. – On July 9, 2013, a federal jury in U.S. District Court for the Eastern District of Tennessee, at Knoxville, found Rigoberto Francisco-Reyes, a national and citizen of Mexico, guilty of being previously deported and re-entering the United States without permission. After the jury’s verdict was announced, Francisco-Reyes was remanded into federal custody by the Honorable Thomas Varlan, U.S. District Judge. Sentencing has been set for 2:00 p.m., Dec. 4, 2013.
Evidence at trial showed that Francisco-Reyes had been previously deported from the United States five times, and that he had several prior felony convictions for immigration offenses.
This case was investigated by the Bureau of Immigration and Customs Enforcement (ICE) in collaboration with the White Pine Police Department. Assistant U.S. Attorney Melissa M. Kirby represented the United States.
“This case is a prime example of ICE identifying and detaining a violent criminal and egregious immigration law violator who poses the greatest threat to public safety,” said Scott L. Sutterfield, acting field office director of ERO New Orleans. Sutterfield oversees ERO activities in Tennessee, Louisiana, Alabama, Arkansas and Mississippi.
Mercer Co. Man Indicted by A Federal Grand Jury for Child Pornography OffenseRead the Press Release
CHARLESTON, W.Va. – United States Attorney Booth Goodwin announced that a 60-year-old Mercer County man was indicted on July 9 by a federal grand jury sitting in Beckley for a child pornography offense. Johnny Richard Rowe, of Bluewell, W.Va., was charged with possession of child pornography. The single-count indictment alleges that on June 19, 2013, Rowe possessed hundreds of images and videos of child pornography on his computer.
Rowe faces up to 20 years in prison and a $250,000 fine if convicted.
The West Virginia Internet Crimes Against Children Task Force conducted the investigation. Assistant United States Attorney Lisa Johnston is in charge of the prosecution.
The indictment was brought as part of U.S. Attorney Goodwin’s ongoing initiative to combat child sexual exploitation and abuse in the Southern District of West Virginia.
Note: The charge contained in the indictment is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.
Click here to view a copy of the indictment
McLaughlin Man Pleads Guilty to Assault with A Dangerous WeaponRead the Press Release
United States Attorney Brendan V. Johnson announced that Ryan Soft, age 22, of McLaughlin, South Dakota, appeared before U.S. District Judge Roberto A. Lange on July 9, 2013, and pled guilty to Count I of the Indictment that charged him with Assault with a Dangerous Weapon.
The maximum penalty upon conviction is 10 years of imprisonment, a $250,000 fine, or both; 3 years 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 wherein on the evening of February 25 and into the early morning hours of February 26, 2013, Soft was at the house of some friends, drinking and socializing with the victim and others. Soft and another person got into a fight, when the victim intervened and began pushing/punching Soft in an effort to break up the fight. Eventually, Soft was sitting down in the corner of the room. The victim took a couple of steps back and Soft stood to his feet, then pulled a knife from his pocket and stabbed the victim in the stomach. The victim fell to the floor and then retreated to the kitchen.
The investigation was conducted by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Jay Miller is prosecuting the case.
Soft was remanded to the custody of the U.S. Marshals Service pending sentencing which has been set for September 23, 2013.
# # #Maryland Man Sentenced on Drug ChargesRead the Press Release
Jackson, Miss. – Ransel Keith Pryor, age 44, of Clinton, Maryland, was sentenced by U.S. District Judge Keith Starrett to serve 188 months in prison followed by five years of supervised release for possession with intent to distribute over five kilograms of cocaine hydrochloride, announced U.S. Attorney Gregory K. Davis. Pryor was also ordered to pay a fine of $17,500.00.
Pryor was charged as the result of a traffic stop on I-59 in Jones County, Mississippi, where he was found to be in possession of over five kilograms of cocaine hydrochloride.
This case was investigated by the Drug Enforcement Administration, Pearl Police Department, and Jones County Sheriff’s Department. It was prosecuted by Assistant United States Attorney Erin Chalk.
###If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
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Maryland Man Pleads Guilty to Felony Charges in Broad Daylight Kidnapping and Assault-Defendant Abducted Girlfriend After High-Speed Chase-Read the Press Release
WASHINGTON – Christopher Devese, 22, of Capitol Heights, Md., has pled guilty to charges stemming from an incident in which he abducted his pregnant girlfriend from a gas station, robbed her and then assaulted her, U.S. Attorney Ronald C. Machen Jr. announced today.
Devese pled guilty on July 9, 2013, in the Superior Court of the District of Columbia, to charges of kidnapping, assault with a dangerous weapon, robbery, and felony contempt. The plea is contingent upon the approval of the Honorable John Ramsey Johnson, who scheduled sentencing for Sept. 13, 2013. If the court accepts the plea at the time of sentencing, Devese will be sentenced to a period of incarceration between four and seven years.
According to the government’s evidence, on April 27, 2013, at about 12:30 p.m., Devese chased his girlfriend, the victim, in a car from Capitol Heights, Md., into the District of Columbia, as she sped through red lights trying to get away from him. The victim, who had called 911 for help while being pursued by Devese, was finally cornered in a gas station parking lot in the 4900 block of South Dakota Avenue NE. Devese smashed the car window to get into the car and pulled his girlfriend out. He then put her into his car and drove her to an unknown alley in the District of Columbia, where he repeatedly assaulted her, including beating her in the stomach with his casted fist. During the assault, he also robbed the victim of her cell phone, which police recovered from him when he was arrested. Devese then drove the victim back to Capitol Heights, Md., where he assaulted her again before his mother came to the victim’s aid.
In announcing the plea, U.S. Attorney Machen commended the work of those who investigated the case from the Metropolitan Police Department’s Sexual Assault Unit and the FBI/MPD Violent Crimes Task Force. He also praised those who handled the case for the U.S. Attorney’s Office, including Victim/Witness Advocate Lezlie Richardson, Paralegal Specialist D’Yvonne Key, and Intern Lucie Enns. Finally, he commended the efforts of Assistant U.S. Attorney Mervin A. Bourne, Jr., who investigated and indicted the case.
13-241Manhattan Business Owner Pleads Guilty in Manhattan Federal Court to Multi-Million Dollar Ponzi SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that JASON KONIOR, the founder and manager of a number of related business entities in New York City, collectively referred to as “Absolute,” pled guilty today in Manhattan federal court in connection with his operation of a multi-million dollar Ponzi scheme in which he stole at least $2.9 million from small hedge fund investors and used the funds to pay off prior investors and to pay himself. KONIOR was originally charged in February 2013, and pled guilty today before U.S. District Judge Alvin K. Hellerstein.
Manhattan U.S. Attorney Preet Bharara said: “In the space of less than a year, Jason Konior managed to take at least $2.9 million that he had solicited from his investors, and then use it to settle up with previous investors and to pay himself. Today’s plea ensures that he will be punished for perpetrating this Ponzi scheme on his victims.”
According to the Information, statements made during today’s guilty plea proceeding, and a Complaint previously unsealed in Manhattan federal court:
From late 2011 through May 2012, KONIOR organized and managed a Ponzi scheme in which he misappropriated at least $2.9 million in funds he had solicited from hedge fund investors. He represented to these investors that Absolute would provide additional trading funds of up to nine times the investment they made in Absolute. As part of Absolute’s “first loss” investment program, KONIOR claimed that he would place the combined funds – the investors’ funds and the additional funds to be provided by Absolute – in a brokerage account designated by Absolute. According to KONIOR, the hedge fund investors would then be able to trade securities utilizing that brokerage account. Under the arrangement, the hedge funds would be responsible for trading losses, and they would share any profits with Absolute.
Instead of establishing brokerage accounts for the victim hedge funds, however, KONIOR misappropriated the funds they provided by paying redemptions to prior investors, making payments to himself, and paying various personal and business expenses. In e-mails, text messages, and telephone conversations, KONIOR pretended that he was establishing brokerage accounts for the three hedge fund investors, when he had already stolen their money. For example, in one case, after KONIOR repeatedly failed to set up a brokerage account for one of the hedge fund investors, the manager of the hedge fund investor sent him a text message stating, “I want my money back. What did you do to it anyway? Are you going to tell me or do you want the SEC to find out?” KONIOR responded with a text message stating, “[w]e have your funds in our acct. Where else would they be?” At the time KONIOR wrote the message, he had already used that hedge fund’s investment to pay off other investors and his own expenses.
KONIOR, 39, of New York, New York, pled guilty to one count of wire fraud, which carries a maximum potential penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense. He is scheduled to be sentenced by Judge Hellerstein on November 8, 2013 at 11:00 a.m.
Mr. Bharara praised the work of the Federal Bureau of Investigation and the Securities and Exchange Commission.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys John T. Zach and Jason H. Cowley are in charge of the prosecution.
U.S. v. Jason Konior Information
Man Sentenced for Vandalism in National ForestRead the Press Release
ASHEVILLE, N.C. – The U.S. Attorney’s Office, in conjunction with the U.S. Forest Service, today announced that Tyler Pace was sentenced to 90 days incarceration by United States Magistrate Judge Dennis Lee Howell for vandalizing parts of Max Patch, a scenic area in the Appalachian Ranger District, Pisgah National Forest North Carolina.
“This sentence sends a message to vandals that damaging our public lands will not be tolerated,” said United States Attorney Anne Tompkins.
Pace received the sentence during an appearance in U.S. District Court in Asheville on July 9, 2013. Prior to his sentencing hearing, Pace paid restitution for his share of the damage to Max Patch.
Pace was with a group of men who illegally drove vehicles in the Max Patch area in January 2013, causing more than $5,000 of damage to that scenic area. Pace facilitated that damage by tearing down the entrance gate and fence, thereby enabling the other persons to drive their vehicles into the protected area where vehicles are prohibited. Pace is 24 years old and a resident of Canton, North Carolina.
Max Patch sits next to the Tennessee state line in the Harmon Den area and is intersected by the Appalachian Trail. At 4,629 feet this bald offers 360-degree vistas of Mount Mitchell to the east and the Great Smoky Mountains to the southwest. An abundance of ferns and grasses blanket the area making it perfect for picnics.
The case was prosecuted by Assistant United States Attorney Richard Edwards.
Man from Mexico Pleads Guilty to Illegal Reentry After DeportationRead the Press Release
United States Attorney Brendan V. Johnson announced that Jesus Ochoa Aguirre, age 30, from Mexico, appeared before U.S. District Judge Roberto A. Lange on July 8, 2013, and pled guilty to the Indictment that charged him with Illegal Reentry after Deportation.
The maximum penalty upon conviction is 2 years of imprisonment, a $250,000 fine, or both; 1 year of supervised release; an additional year 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 or about September 24, 2012, when Ochoa Aguirre, a/k/a Felipe Cabrera Aguirre, an alien, was found in the United States in the District of South Dakota, after having been previously deported from the United States on or about April 16, 2010. Ochoa Aguirre did not obtain the consent of the Secretary of the United States Department of Homeland Security and the Attorney General of the United States to apply for admission into the United States.
The investigation was conducted by the Department of Homeland Security. Assistant U.S. Attorney Kathryn N. Rich is prosecuting the case.
Ochoa Aguirre was remanded to the custody of the U.S. Marshals Service pending sentencing which has been set for August 28, 2013.
# # #Luray Man Sentenced to 108 Months for Defrauding HIV/Aids InvestorsRead the Press Release
RICHMOND, Va. – Michael F. Harris, 49, of Luray, Virginia, was sentenced to 108 month’s imprisonment today for his role in defrauding investors of more than $800,000 from a project aimed at purportedly developing a treatment for Human Immunodeficiency Virus infection/Acquired Immunodeficiency Syndrome (HIV/AIDS). Earlier this year, Harris was found guilty of wire fraud and mail fraud following a five-day jury trial.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and Jeffrey C. Mazanec, Special Agent in Charge of the FBI’s Richmond Field office, made the announcement following the sentencing.
According to evidence presented at trial, Harris was the President and majority shareholder of M.F. Harris Research Inc. (MFH), a company incorporated under the laws of North Carolina in December 2003. He formed MFH to develop a treatment for HIV/AIDS. At various times in the past, Harris claimed to have discovered that the use of hyperbaric chambers to treat divers infected with HIV/AIDS for decompression sickness (also referred to as “the bends”) unexpectedly inhibited the virus. Harris claimed that MFH was devoted to pursuing a potential treatment regimen for HIV/AIDS using the hyperbaric chambers.
Evidence established that prior to October 2005 and continuing through at least July 2011, Harris solicited more than 80 investors for funds for MFH purportedly to use for: (a) obtaining MFH patents, both in the United States and abroad; (b) conducting human trials or assisting with advancing human trials using the treatment method; (c) continuing research on the treatment method; and (d) developing a treatment for HIV/AIDS. In connection with those investments, the defendant sold equity shares of MFH original issue stock and represented that invested funds would largely be used to pursue those objectives. From 2005 through 2011, Harris solicited most investors to pay $1 per share and, in many instances, he promised that MFH shares would be worth 10 to 20 times that amount once the patents were approved and clinical trials completed. On several occasions, Harris solicited investors with a sense of urgency and immediate need for funds to meet deadlines associated with the United States or foreign patent applications.
At trial, the United States established that Harris made material misrepresentations and omissions in connection with handling the investor funds, including: (a) misrepresentations regarding MFH’s actual and proposed ownership of the United States patent; (b) misrepresentations about the security of the investments; (c) affirmative acts of concealing financial information regarding MFH and the defendant’s use of MFH investment funds; and (d) omissions regarding Harris’s intended use of the MFH investment funds for his personal benefit. In reality, the defendant retained the United States patent in his own name and diverted the overwhelming majority of MFH investment funds for his personal us. Between October 2005 and July 2011, Harris received over $875,000 in funds from the investors for MFH. A financial analyst from the National White Collar Crime Center (NW3C) testified at trial that of this money Harris misappropriated over $800,000 for his own use, unrelated to the MFH areas identified by the defendant to the investors. He used those funds to, among other things: (a) spend more than $250,000 for the costs associated with the purchase, improvements, and utilities associated with the defendant’s primary residence in Luray, Virginia; (b) pay over $70,000 for his horse and farm expenses; (c) spend more than $25,000 at firearms stores; and (d) pay other personal expenses, including automobile, entertainment, restaurant, spa, and international travel to competitive kayaking events.
The investigation was led by the Fredericksburg office of the Federal Bureau of Investigation (FBI) and the Virginia State Corporation Commission (SCC). Those agencies received assistance in the financial investigation from the National White Collar Crime Center (NW3C). Assistant United States Attorney Michael Gill and Special Assistant United States Attorney and Counsel with the SCC Gauhar Naseem prosecuted the case on behalf of the United States.
This investigation has been coordinated by the Virginia Financial and Securities Fraud Task Force, an unprecedented partnership between criminal investigators and civil regulators to investigate and prosecute complex financial fraud cases in the nation and in Virginia. The task force is comprised of several federal and state agencies, including the Virginia Attorney General’s Office. The task force is an investigative arm of the President’s Financial Fraud Enforcement Task Force (FFETF), an interagency national task force.
The FFETF 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.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Local Merchants Indicted for Distribution of Designer DrugsRead the Press Release
Little Rock - Christopher R. Thyer,United States Attorney for the Eastern District of Arkansas, and William J. Bryant, Assistant Special Agent in Charge of the Little Rock District Office of the Drug Enforcement Administration (DEA), announced today that seven individuals were indicted by a federal grand jury in connection with Project Synergy, the largest-ever coordinated law enforcement strike against designer drugs. The indictment charges Amjad Kattom, age 36; Sahar Kattom, age 34; Yousef Qattoum, age 37;Abdul Aziz Farishta, age 50; Eassa Rawashdeh, age 23; Rodney Bryant, age 22; and Adam Kattoum, age 20, in Count 1 with conspiracy to distribute and possess with intent to distribute controlled substances and analogues of controlled substances, in violation of Title 21, United States Code, Section 846. Counts 2 and 3 charge Yousef Qattoum with distribution and possession with intent to distribute a controlled substance analogue. Count 4 charges Eassa Rawashdeh with distribution and possession with intent to distribute a controlled substance analogue. Count 5 charges Adam Kattoum with distribution and possession with intent to distribute a controlled substance and a controlled substance analogue. Count 6 charges Rodney Bryant with being a felon in possession of a firearm. Count 7 charges Amjad Kattom and Sahar Kattom with conspiracy to commit money laundering. Count 8 charges Yousef Qattoum and Abdul Aziz Farishta with conspiracy to commit money laundering. The indictment also seeks to forfeit approximately $17,338.40 in United States currency and real property of Amjad and Sahar Kattom.
The statutory penalty for conspiracy to distribute and possess with intent to distribute controlled substances and analogues of controlled substances and distribution and possession with intent to distribute controlled substances and analogues of controlled substances is not more than 20 years in prison, a $1,000,000 fine or both, with not less than three years of supervised release to follow. The statutory penalty for conspiracy to commit money laundering is not more than 20 years in prison, a fine of the greater of $500,000 or twice the value of the property involved in the transaction, or both, with not more than three years of supervised release to follow.
The investigation was conducted by the DEA - Tactical Diversion Squad composed of DEA Special Agents, DEA Diversion Investigators, and Task Force Officers from: Little Rock Police Department, Conway Police Department, Jefferson County Sheriff's Office, and Pine Bluff Police Department. Also taking part in the investigation was Homeland Security Investigations; the Internal Revenue Service - Criminal Investigation Division including Task Force Officers from Benton Police Department and Pulaski County Sheriff's Office; with the United States Postal Inspectors and the Little Rock Police Department. Assisting agencies were the Arkansas National Guard; the Federal Bureau of Investigation; the Bureau of Alcohol, Tobacco, and Firearms; the United States Secret Service; the Arkansas State Police and the Arkansas Tobacco Control Board.
A indictment contains only allegations. A defendant is presumed innocent unless and until proven guilty.
For more information on this case, see previous news release at:
http://www.justice.gov/usao/are/news/2013/June/Synergy_kattom_complaint_DEA_062613.html
(Indictment )
Justice Department Settles Lawsuit Against Erie County, N.Y., over Disability DiscriminationRead the Press Release
The Justice Department today announced it filed a lawsuit in the U.S. District Court for the Western District of New York against Erie County, N.Y., alleging that the county discriminated against an employee with a disability. The department simultaneously filed a consent decree to resolve the claims. In its lawsuit, the department alleges that the county violated the Americans with Disabilities Act (ADA) by refusing to promote a maintenance worker with monocular vision because he did not have a commercial driver’s license. The Justice Department found that the employee was qualified for the promotion and that he could perform all the important job duties associated with the promotion. The department also found that there were other employees who did not have a commercial driver’s license who had been promoted to the position.
“The result of the county’s action was to deny a promotion to someone who should have received it,” said Eve L. Hill, Senior Counselor to the Assistant Attorney General for the Civil Rights Division. “The Justice Department is committed to removing these types of discriminatory barriers, and to ensuring equal employment opportunities for people with disabilities.”
The consent decree, which must be approved by the court, requires the county to pay the employee $22,486 in back pay and interest, offer him a promotion with remedial seniority, provide training on the ADA and file periodic reports with the Justice Department.
Title I of the ADA prohibits employers, such as Erie County, from discriminating against people on the basis of disability in various aspects of employment. These prohibitions include using qualification standards that screen out individuals with disabilities and that are not job-related and consistent with business necessity. The ADA also requires employers to provide reasonable accommodations to otherwise qualified individuals with disabilities, where such an accommodation does not pose an undue hardship.
Those interested in finding out more about the ADA may call the Justice Department’s toll-free ADA information line at 800-514-0301 (TDD 800-514-0383) or visit www.ada.gov.
Justice Department Issues Statement on U.S. District Court<br /> Ruling That Apple Violated Antitrust LawsRead the Press Release
Assistant Attorney General Bill Baer in charge of the Department of Justice’s Antitrust Division made the following statement today after the U.S. District Court for the Southern District of New York found that Apple Inc. violated Section 1 of the Sherman Act by conspiring to raise e-book prices and end e-book retailers’ freedom to compete on price:“This result is a victory for millions of consumers who choose to read books electronically. After carefully weighing the evidence, the court agreed with the Justice Department and 33 state attorneys general that executives at the highest levels of Apple orchestrated a conspiracy with five major publishers – Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster – to raise e-book prices. Through today’s court decision and previous settlements with five major publishers, consumers are again benefitting from retail price competition and paying less for their e-books.
“As the department’s litigation team established at trial, Apple executives hoped to ensure that its e-book business would be free from retail price competition, causing consumers throughout the country to pay higher prices for many e-books. The evidence showed that the prices of the conspiring publishers’ e-books increased by an average of 18 percent as a result of the collusive effort led by Apple.
“Companies cannot ignore the antitrust laws when they believe it is in their economic self-interest to do so. This decision by the court is a critical step in undoing the harm caused by Apple’s illegal actions.
“I am proud of the outstanding work done by the trial team. The Antitrust Division will continue to vigorously protect competition and enforce the antitrust laws in this important business, and in other industries that affect the everyday lives of consumers.”Background
On April 11, 2012, the department filed a civil antitrust lawsuit in the U.S. District Court for the Southern District of New York against Apple, Hachette Book Group (USA), HarperCollins Publishers L.L.C., Holtzbrinck Publishers LLC, which does business as Macmillan, Penguin Group (USA) Inc. and Simon & Schuster Inc., for conspiring to end e-book retailers' freedom to compete on price by taking control of pricing from e-book retailers and substantially increasing the prices that consumers paid for e-books.
At the same time that it filed the lawsuit, the department reached settlements with three of the publishers – Hachette, HarperCollins and Simon & Schuster. Those settlements were approved by the court in September 2012. The department settled with Penguin on Dec. 18, 2012, and with Macmillan on Feb. 8, 2013. The Penguin settlement was approved by the court in May 2013. Final approval of the Macmillan settlement is pending before the court. Under the settlements, each publisher was required to terminate agreements that prevented e-book retailers from lowering the prices at which they sell e-books to consumers and to allow for retail price competition in renegotiated e-book distribution agreements.
The department’s trial against Apple, which was overseen by Judge Denise Cote, began on June 3, 2013. The trial lasted for three weeks, with closing arguments taking place on June 20, 2013. The court has not yet scheduled a hearing to address the parties’ proposed remedies.Justice Department Distributes More Than $3.4 Million to Local Police and Law EnforcementRead the Press Release
The Justice Department this week distributed more than $3.4 million to local and state law enforcement agencies under its equitable sharing program, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
“This money will provide badly needed resources to police departments throughout Northeast Ohio. Departments and agencies in Cuyahoga, Summit, Stark and Lake County will all get money, in some cases hundreds of thousands of dollars,” Dettelbach said. “The community gets a double benefit when we take ill-gotten money from criminals and drug dealers and use it to support local police and law enforcement.”
The money came from seizures and forfeitures in three federal cases –a heroin trafficking organization led by Christopher Ugochukwu, the money laundering conviction of Paul Monea and a 2010 traffic stop in Twinsburg that resulted in a seizure of $677,660.
Under the equitable sharing formula, the Justice Department keeps 20 percent of the seized assets. The remaining money is divided among other participating agencies based on hours worked on the case. The U.S. Marshal administers the funds.
More than $2 million came from the Ugochukwu case. Most of that came from cash that was forfeited. Additionally, property was seized in Solon, Cleveland, Cleveland Heights and Shaker Heights. Twelve vehicles were also seized.
Ugochukwu is currently serving a 26-year prison sentence for leading an organization that brought heroin from Nigeria, Mexico and Colombia and sold it throughout Greater Cleveland. Authorities seized more than 20 kilograms of heroin in 2010, believed to be the largest heroin seizure in Ohio history. Twenty-three people were convicted of crimes for their roles in the operation.
The Northern Ohio Law Enforcement Task Force, which led the Ugochukwu investigation, received more than $1.7 million. The NOLETF is jointly led by the FBI and Cleveland police and focused on large-scale drug trafficking investigations.
That $1.7 million will be divided among the cities and agencies whose departments participated in the Ugochukwu investigation, including Cleveland, the Greater Cleveland Regional Transit Authority, Cleveland Heights, Euclid, Shaker Heights, the Cuyahoga County Sheriff’s Office, the Cleveland Metropolitan Housing Authority, University Heights and the Lake County Narcotics Agency.
The FBI and Cleveland, University Heights and Parma police departments will also receive forfeited vehicles.
More than $1.7 million came from the conviction of Paul Monea, who was sentenced to 13 years in prison for conspiracy and money laundering. Monea tried to sell the 43-carat “Golden Eye” diamond to an undercover FBI agent posing as a broker for a South American drug cartel.
The diamond was seized and auctioned following Monea’s conviction, as was $100,000.
More than $1.2 million from the Monea case will go to local and state police. The distribution of assets is as follows: the Canton Police Department, $749,525; the Alliance Police Department, $282,429; the Ohio Adult Parole Authority, $46,460; the Stark County Sheriff’s Office, $37,092; the Internal Revenue Service, $36,643; the Shaker Heights Police Department, $36,643; the Ohio National Counterdrug Task Force, $19,496; the Jackson Township Police Department, $12,289; the Massillon Police Department, $8,990, and the Perry Township Police Department, $3,853.
Finally, Khalilah Crumpler had an outstanding warrant in Mayfield Heights when she was pulled over on a traffic stop in Twinsburg in 2010. She was taken into custody and a search of her car revealed $677,660 – some of which was wrapped in dryer sheets, which is often used to mask the smell of drugs. A drug detection dog then alerted positively for the odor or illegal narcotics. That currency was forfeited because it constituted proceeds from drug trafficking activities and/or was used or intended to be used to facilitate drug trafficking.
Of that money, $432,947 went to the Twinsburg Police Department and $54,880 to the Summit County Prosecutor’s Office.
Jury Convicts Podiatrist, Psychologist and Pharmacist in Health Care Fraud CaseRead the Press Release
A podiatrist, a psychologist and a pharmacist were convicted today in federal court in Detroit, Michigan for health care fraud and controlled substance distribution, United States Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Special Agent in Charge Robert L. Corso, Drug Enforcement Administration, Detroit Division, Special Agent in Charge Robert D. Foley, III, Federal Bureau of Investigation and Lamont Pugh, III, Special Agent in Charge, Department of Health and Human Services Office of Inspector General ("HHS-OIG").
United States Attorney Barbara L. McQuade stated, “Law enforcement investigators in metro-Detroit are aggressively investigating health care fraud and detecting abuses by doctors and pharmacists. We hope that prosecutions like this one will deter medical professionals from stealing taxpayer funds intended for health care.”
Convicted were podiatrist Anmy Tran, 42, of Clinton Township, psychologist Sanyani Edwards, 34, of Southfield, and pharmacist Mitesh Patel, 39, of Troy. Defendants Tran and Edwards were convicted on all three of the counts with which they were charged, specifically conspiracies to commit health care fraud, to distribute controlled substances, and to pay or receive health care kickbacks. Defendant Patel was convicted of six of the seven counts with which he was charged, specifically health care fraud conspiracy, conspiracy to distribute controlled substances, and two substantive counts each of health care fraud and controlled substances distribution. Defendant Mitesh Patel was acquitted of conspiracy to pay or receive health care kickbacks.
The evidence presented during the three-week trial demonstrated that, from approximately January 2006 through August 2011, Canton Pharmacist Babubhai Patel owned and controlled over 20 pharmacies (termed “the Patel Pharmacies” at trial), which operated in and around Detroit, Michigan. The evidence also showed that Babubhai Patel’s model for turning a profit at his pharmacies was based upon large-scale health care fraud and the diversion of controlled substances. Babubhai Patel paid cash kickbacks and other things of value to physicians in exchange for those physicians writing prescriptions for expensive medications, without regard to medical necessity, that could be billed to Medicare, Medicaid, or a private insurer through one of the Patel Pharmacies. Physicians affiliated with Babubhai Patel would also write prescriptions for controlled substances for their patients, again regardless of medical necessity, which would then be filled at one of the Patel Pharmacies. These controlled substances were distributed to patients and patient recruiters as a kickback in exchange for the patients using a Patel Pharmacy. Pharmacists at the Patel Pharmacies would increase the pharmacies’ profits by billing insurers for medications never actually distributed to patients.
The evidence presented at trial showed that defendant Anmy Tran was one of the physicians to whom Babubhai Patel paid bribes and kickbacks in exchange for referrals of prescriptions. In exchange, Tran wrote numerous prescriptions for expensive medications, without regard to medical necessity, that could be filled at one of the Patel Pharmacies. Evidence presented at trial demonstrated that defendant Mitesh Patel, a pharmacist in Babubhai Patel’s organization, billed Medicare, Medicaid, and private insurers for expensive medications he never dispensed to patients. With respect to Sanyani Edwards, the evidence presented at trial showed that he offered and paid bribes and kickbacks to doctors, nurses, and assisted-living facility owners in exchange for referrals of prescriptions to the Patel Pharmacies. Edwards also worked with a corrupt psychiatrist to write fictitious prescriptions for patients, which could then be billed at a Patel Pharmacy.Defendants Tran, Edwards, and Mitesh Patel were three of 26 individuals who were charged in August, 2011, with offenses relating to their involvement with Babubhai Patel’s pharmacy network. All 26 of the original defendants have now been convicted of felonies arising out of their involvement with Babubhai Patel; 17 of those defendants entered guilty pleas, and nine, including the three defendants today, have been convicted after trial. Defendant Babubhai Patel was convicted at a trial in August 2012; he is serving a 17-year prison sentence. A superseding indictment charging 13 additional individuals was unsealed in March 2013; those defendants’ cases remain pending, with a trial date set for January 2014.
The case was prosecuted by Assistant United States Attorneys John K. Neal and Wayne F. Pratt.
Jury Convicts Inmate in Meth Trafficking ConspiracyRead the Press Release
CORPUS CHRISTI, Texas – Juan Ledezma, 40, of Brownsville, has been convicted by a federal jury of drug trafficking in a conspiracy that involved gang leadership both inside and outside of the Texas prison system, United States Attorney Kenneth Magidson announced today. The jury returned its guilty verdict just a short time ago after two days of trial and one hour of deliberation.
Ledezma was one of the final defendants to be found guilty in a 13-count indictment that involved 31 others, 13 of whom are former McConnell Unit prison guards. Of the 32 defendants in the case, 29 have now been convicted and two are fugitives. The final defendant, Melissa Lozano, is set for trial on July 22. She is presumed innocent unless and until proven guilty through due process of law.
During the trial, the jury heard testimony that Ledezma acted as an intermediary between drug traffickers in south Texas and Mexico. He had connections to drug suppliers and, utilizing illegal cell phones smuggled in by corrupt guards, coordinated with other prisoners to organize drug deals inside and outside the prison. Jurors heard that prisoners had made phone calls to Ledezma while in the McConnell Unit of Texas Department of Criminal Justice (TDCJ). In these calls, Ledezma agreed to help arrange for six pounds of methamphetamine to be purchased in Corpus Christi and distributed in Arkansas. The buyers of the methamphetamine were to pay more than $20,000 per pound of the drug.
Ledezma and others stood to make thousands of dollars in profit from inside their prison cells on this one deal alone. The jury also heard that agents with Homeland Security Investigations (HSI) watched as a transfer of a sample of the drug took place in McAllen. The drug deal ultimately was unsuccessful, yet resulted in conspiracy charges for Ledezma and others. Numerous other inmates and gang members on the street have also pleaded guilty in this and prior related prosecutions, including Preston Mascorro, Jerome Aranda, Israel Plazola, Michael Ornelas, Jose Manuel Ledezma, Rudy Rodriguez, Anthony Torres, Ricky Alejandro, Martin Guardiola III and Stephen Ayala, resulting in lengthy federal sentences.
Ledezma faces up to life in prison and an $8 million fine. He will remain in custody pending sentencing.
These convictions were the result of an ongoing investigation dubbed Operation Prison Cell being conducted jointly by special agents with HSI, Internal revenue Service – Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and officers of the Texas Department of Criminal Justice – Office of Inspector General and the Corpus Christi Police Department Gang and Organized Crime Units.
The case is being prosecuted by Assistant United States Attorney Mark Patterson and Michael Hess.
Jackson Man Sentenced on Drug ChargesRead the Press Release
Jackson, Miss. – Willie Earl Culley, of Jackson, was sentenced to 57 months in prison followed by four years of supervised release for conspiracy to possess with intent to distribute cocaine, announced U. S. Attorney Gregory K. Davis and FBI Special Agent in Charge Daniel McMullen. He was also ordered to pay a $1500 fine.
Culley was indicted in connection with “Operation Paperchase”, an extensive investigation targeting illegal narcotics distribution in the City of Jackson. He pled guilty in November, 2012.
This case was investigated by the Federal Bureau of Investigation with assistance from the Drug Enforcement Administration, U.S. Marshals Service, Gulf Coast HIDTA and Mississippi Bureau of Narcotics. It was prosecuted by Assistant United States Attorney Erin Chalk.
###If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Illegal Alien, Sergio Jose Nogueira, Pleads Guilty to Illegal Use of A Social Security Number and Making False Statements on A Passport ApplicationRead the Press Release
SERGIO JOSE NOGUEIRA, age 34, a citizen of Brazil, pled guilty in federal court today before U.S. District Judge Sarah S. Vance, to a two-count indictment charging him with illegal use of a Social Security number and making false statements on a passport application, announced U.S. Attorney Dana J. Boente.
According to the factual basis, on or about June 8, 2012, NOGUEIRA falsely represented that a Social Security number had been assigned to him by the Commissioner of Social Security with intent to deceive, for the purpose of obtaining a Louisiana driver’s license. NOGUEIRA also admitted to knowingly making false statements in a passport application by providing a false name, date of birth, and place of birth, to secure the issuance of a United States Passport for his own use on or about June 12, 2012. NOGUEIRA is illegally present in the United States.
NOGUEIRA faces a maximum term of imprisonment of 15 years, a fine of up to $500,000, and three years of supervision following release from imprisonment. Sentencing is scheduled for October 16, 2013 at 9:30 A.M.
This case was investigated by Untied States Immigration and Customs Enforcement, Enforcement and Removal Operations with the assistance of the United States Department of State, Diplomatic Security Service. The prosecution is being handled by Special Assistant United States Attorney Robert Weir.
(Download Factual Basis )
Illegal Alien Sentenced for Identity TheftRead the Press Release
Hattiesburg, Miss - Moises Perez-Torales, 28 of Vera Cruz, Mexico was sentenced by U.S. District Judge Keith Starrett to serve 24 months in federal prison followed by one year of supervised release for knowingly possessing and using a means of identification of another person, announced U.S. Attorney Gregory K. Davis.
Perez-Torales, who was in the United States illegally, used a stolen social security number to create false documents to represent himself as a U.S. citizen to obtain employment.
The case was investigated by Homeland Security Investigations with assistance from the Forrest County Sheriff’s Department. It was prosecuted by Assistant United States Attorney Annette Williams.
###If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Houston Man Handed Sentence in Area Armored Car RobberiesRead the Press Release
HOUSTON – Walter Keitric Freeman, 24, of Houston, has been ordered to federal prison following his conviction in the robbery and attempted robbery of two armored cars operating in and around Houston, United States Attorney Kenneth Magidson announced today. Freeman entered a plea of guilty Friday, April 12, 2013.
Today, U.S. District Judge Gray H. Miller handed Freeman a sentence of 57 months for his conviction of conspiracy to interfere with commerce by robbery as well as a consecutive sentence of 10 years for discharging of a firearm during the commission of a crime of violence. Following his total 177-month sentence, Freeman will be on supervised release for five years. Freeman will also be jointly and severally liable to pay back the money stolen from a Loomis Armored truck on Nov. 21, 2009.
Four others also charged in the case - Hendrick Dwayne Lynn, 30, Chad Eric Haywood, 24, and Corinthians Lachell Phillips, 28, all of Houston, and Allen Moore Jr., 46, of Dallas – had previously also entered guilty pleas for their roles in the crimes and will be sentenced in September 2013. Lynn and Haywood were both convicted of two counts of interference with commerce by robbery, while Lynn and Phillips also admitted to the conspiracy charge. Haywood also pleaded guilty to a count of discharging a firearm during a crime of violence as did Moore who was further convicted of interference with commerce by robbery.
Loomis Armored US Inc., who operated the trucks during the alleged robbery and robbery attempt, maintains offices throughout the United States and was engaged in the business of secured armored transport of United States currency in interstate commerce and in picking up and delivering United States currency to financial institutions and check cashing businesses, both of which are industries which affect interstate commerce.
Lynn, Haywood and Moore were charged with their involvement in the Aug. 7, 2009, attempted robbery of a Loomis armored truck at the Bank of America at 3704 Old Spanish Trail in Houston. Lynn drove to the location, at which time Haywood and Moore, who were armed with Glock pistols, jumped out and shot at the guard. The guard has since recovered. The guard had been filling an ATM machine, but it was already locked and no money was obtained.
The second incident occurred on Nov. 21, 2009, at which time another guard was shot. On that date, Lynn drove Freeman and Haywood to Senor Check Cashing Store #2 located at 5950 S. Gessner Rd. in Houston. Freeman fired his pistol and shot in the direction of the guard. The guard was hit, but survived. On that same date, Phillips drove a second vehicle to the Gessner location and, following the robbery, switched vehicles with Haywood, Freeman and Lynn.
Phillips has been permitted to remain on bond, while the others have been and will remain in custody pending further criminal proceedings.
The case was investigated by the FBI’s Bank Robbery Task Force and is being prosecuted by Assistant United States Attorney Jennie Basile.Hollygrove Gang Member, Norman Ratcliff, Pleads Guilty to Federal Rico, Drug, and Murder ChargesRead the Press Release
NORMAN RATCLIFF, aka “Turk,” 21, a resident of New Orleans, pled guilty today in federal court to various federal violations stemming from a 34 count second superseding indictment. RATCLIFF and several of his associates were charged with participating in a violent drug gang that operated in the Holly Grove area of the City of New Orleans.
RATCLIFF pled guilty to RICO conspiracy and conspiracy to distribute 28 grams or more of crack cocaine. He also pled to the illegal use of a firearm during and in relation to a drug trafficking crime and/or crime of violence in connection with the murder of Eula May Ivey.
RATCLIFF could be sentenced to life in prison and is also subject to a sentence of five to forty years as to the crack cocaine count. He is also faces a fine of up to $5,000,000. Sentencing is scheduled for October 2, 2013.
In November of 2012, a Federal Grand Jury returned a 34-count indictment charging Walter Conley, aka “Ike Neezy;” Tyronne Stevenson, aka “Duke;” Theron Golston, aka “Thema;” Bernell Williams, aka “Bussy,” aka “A-Boogie;” and Mark Glenn with participating in a RICO conspiracy, drug conspiracy, firearms conspiracy, and several substantive acts of violence.
These defendants and others were members and associates of a criminal enterprise which operated in an area of the City that historically encompassed the Hollygrove area of New Orleans, Louisiana. The boundaries of the area include South Carrollton Avenue, Earhart Boulevard, Interstate 10, and the Jefferson Parish line.
RATCLIFF is the sixth defendant in this case to plead guilty.
Co-defendant Carey Jones also pled guilty to a life sentence for his participation in the RICO conspiracy, two separate non-fatal shootings, and for his participation in the murder of Ms. Eula May Ivey.
Co-defendant Bernell Williams pled guilty to participating in the RICO conspiracy, drug conspiracy, gun conspiracy, and to his involvement in two separate non-fatal shootings. He will face a sentence of 25 to 30 years in prison.
Co-defendant Ryan Carroll pled guilty to participating in the RICO conspiracy and to discharging a firearm during a drug trafficking crime and a crime of violence. He faces a sentence of 10 years to life.
Co-defendant China Stewart pled guilty to possession with the intent to distribute crack cocaine and will face a maximum sentence of five years.
Co-defendant Theron Golston recently pled guilty to a life sentence for his participation in the RICO conspiracy, two separate non-fatal shootings, and for his participation in the murder of Ms. Eula May Ivey.
The remaining defendants, Tyronne Stevenson, Mark Glenn, and Walter Conley are scheduled to stand trial on September 23, 2013. All are presumed innocent until proven guilty at trial.
The Multi-Agency Gang Unit is an N.O.P.D. led division which includes federal agents from A.T.F., D.E.A., F.B.I., and the U.S. Marshal’s Service, as well as participants from the Orleans Parish Sheriff’s Office, The Louisiana State Police, State Probation and Parole, and the New Orleans District Attorney’s Office.
The case is being prosecuted by Assistant United States Maurice E. Landrieu, Jr.
(Download Factual Basis )
Harvey Man, Jermaine Hudson, Sentenced for Rico and Federal Controlled Substances Acts ViolationsRead the Press Release
JERMAINE HUDSON, age 25, of Harvey, Louisiana was sentenced today before U.S. District Judge Lance M. Africk after pleading guilty to Violations of the Racketeer Influenced Corrupt Organization and the Federal Controlled Substances Acts, announced U.S. Attorney Dana J. Boente.
HUDSON was sentenced to 27 years (324 months) imprisonment. In addition to the term of imprisonment, Judge Africk ordered that HUDSON be placed on 10 years of supervised release following the term of imprisonment, during which time the defendant will be under federal supervision and risks an additional term of imprisonment should the violate any terms of the supervised release
This case arose out of a joint investigation by FBI, ATF, and the Jefferson Parish Sheriff’s Office. This investigation targeted an area which exhibited a disproportionate amount of violent crimes and narcotics trafficking. During the course of the investigation, specific individuals were identified as the main perpetrators of many of the violent acts and much of the narcotics distribution. Federal and local law enforcement officers interviewed witnesses, confidential informants, as well as state defendants, relative to the targeted individuals. It was revealed that a group of individuals operated in various areas of Harvey Louisiana, specifically the neighborhoods known as Scottsdale and Haydel. This group controlled these areas for their narcotics distribution activities through violence and through threats of violence, to include murder, attempted murder, obstruction and assaults. They were referred to as the Harvey Hustlers and/or Murder Squad.
The “Murder Squad,” or “MS,” was a faction of the Harvey Hustlers composed primarily of individuals residing in the Harvey, Louisiana area of Jefferson Parish, Louisiana. While they primarily operated on the Westbank of Jefferson Parish, members conducted business in other parts of the Eastern District of Louisiana. The “Harvey Hustlers” also referred to as “HH” originated in the Harvey area in the mid-1980s. Members of the organization “hustled” meaning they distributed illegal narcotics. The original goal of the Harvey Hustlers was to make money from sales of illegal narcotics.
The case was investigated by the Bureau of Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco and Firearms, and the Jefferson Parish Sheriff’s Office. The case was being prosecuted by Assistant United States Attorneys Duane A. Evans and Bill McSherry.
Fort Pierre Man Sentenced for Failure to AppearRead the Press Release
United States Attorney Brendan V. Johnson announced that a Fort Pierre, South Dakota, man convicted of Failure to Appear was sentenced on July 8, 2013, by U.S. District Judge Roberto A. Lange.
Brent Flood, age 24, was sentenced to 4 months of imprisonment followed by 4 months at a re-entry center, 1 year of supervised release, and a $100 special assessment to the Federal Crime Victims Fund. The custodial sentence will be served consecutively to a separate sentence for Possession of a Controlled Substance.
Flood was indicted by a federal grand jury on February 13, 2013. The charge stems from an incident wherein Flood, who was indicted by a federal grand Jury in September 2012 for two counts of the felony offense of Distribution of a Controlled Substance, did not show up for his change of plea scheduled for January 22, 2013. Flood knew he was required to appear for this proceeding, but failed to appear as directed. He was later apprehended.
The investigation was conducted by the U.S. Marshals Service. Assistant U.S. Attorney Kathryn N. Rich prosecuted the case.
Flood was immediately turned over to the custody of the U.S. Marshals Service.
# # #Former Warrior Bank Employee Sentenced to 27 Months in Prison for EmbezzlementRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Hayden woman to more than two years in prison for embezzling from the Warrior bank where she worked, announced U.S. Attorney Joyce White Vance and U.S. Secret Service Special Agent in Charge Roy Sexton.
U.S. District Judge James H. Hancock sentenced FRANCES DUCKWORTH, 51, to 27 months in prison for embezzling from Superior Bank and its successors between November 2009 and August 2012. Duckworth worked as head teller at the Warrior bank branch during that time. The bank is now Cadence Bank. Duckworth must forfeit $202,994 to the government as proceeds of illegal activity. She also must pay the same amount in restitution to the victim and serve five years of supervised release following completion of her prison term.
Duckworth pleaded guilty to the embezzlement in March. According to her plea agreement with the government, Duckworth skimmed about $94,994 from deposit transactions between November 2009 and April 2011 at Superior Bank. After the bank became Cadence Bank, Duckworth took about $107,999 from deposit transactions between April 2011 and August 2012.
The Secret Service investigated the case, which Assistant U.S. Attorney Henry Cornelius prosecuted.
Former U.S. Army Reserve Captain Pleads Guilty<br /> in Nevada to Bribery SchemeRead the Press Release
A former U.S. Army Reserve captain pleaded guilty today to accepting more than $90,000 in bribes from contractors while he was deployed to Iraq, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.
Edward William Knotts III, 51, of Gibbon, Neb., pleaded guilty before U.S. District Judge James Mahan in the District of Nevada to a criminal information charging him with one count of bribery. He faces a maximum penalty of 15 years in prison when he is sentenced on Oct. 8, 2013.
According to court documents, from December 2005 until December 2007, Knotts was stationed at Camp Buehring, Kuwait, as a contracting officer’s representative for contracts between the U.S. Army and local contractors to provide services to support the operations at Camp Buehring and another U.S. camp in Kuwait.
In November 2006, Knotts entered into an agreement with a Kuwait-based corporation to receive a monthly fee from the corporation in return for providing confidential bidding information about U.S. Army contracts. Between November 2006 and November 2007, the corporation paid him approximately $31,500 in cash. In June 2007, a representative of the corporation paid Knotts $40,000 at a hotel room in Las Vegas in return for his promise to provide confidential bid information and in anticipation of the corporation hiring him. Knotts received another similar cash payment of $20,000 in August 2008 in a different Las Vegas hotel.
This case was investigated by the Special Inspector General for Iraq Reconstruction, Defense Criminal Investigative Service and U.S. Army Criminal Investigation Command. The case is being prosecuted by Director of Procurement Fraud Litigation Catherine Votaw and Trial Attorney Brian Young of the Criminal Division’s Fraud Section.
Former Preschool Director Pleads Guilty to Tax EvasionRead the Press Release
The Justice Department and the Internal Revenue Service (IRS) announced that Susan C. Valentine, a resident of Fairfax County, Va., pleaded guilty today to tax evasion.
According to documents filed with the court, Valentine was the former director at the Epiphany Weekday School (EWS) in Alexandria, Va. From 2008 through 2010, Valentine received a salary and also took additional funds from EWS for herself and members of her family. Despite earning this income, Valentine did not file income tax returns or pay income taxes for 2008 through 2010. Moreover, as director, Valentine caused false payroll tax forms to be filed on behalf of ESW with the IRS.
Sentencing was scheduled by U.S. District Court Judge James Cacheris for Oct. 18, 2013. Valentine faces a maximum sentence of five years in prison, three years of supervised release, a $250,000 fine and a $100 special assessment. She has agreed to pay restitution to the IRS.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, commended the efforts of special agents of IRS–Criminal Investigation, who investigated the case, and Tax Division Trial Attorneys Melissa Siskind and Karen E. Kelly, who are prosecuting the case.
Former Kinloch Mayor Indicted for Lying on Employment RecordsRead the Press Release
St. Louis, MO - Former Kinloch Mayor KEITH CONWAY was indicted on federal charges of falsifying employment records while completing his original sentence at a St. Louis halfway house, the Dismas House.
According to the indictment, on May 1, 2013, the United States Bureau of Prisons transferred Conway from its prison facility at Marion, Illinois, to the Dismas House residential reentry center in St. Louis. The Bureau of Prisons contracts with Dismas House for the housing and supervision of inmates and retains jurisdiction and responsibility over those inmates until their ultimate release from Bureau of Prisons' custody upon completion of their sentence. As a resident of Dismas House, Conway was required to seek and obtain full-time employment and to submit paycheck stubs to verify that employment to the Dismas House Program Director. While a resident at Dismas House awaiting final release from the Bureau of Prisons, Conway falsely represented that he had obtained full-time employment and was permitted to leave the Dismas House premises during his purported work hours.
Conway was originally sentenced to 21 months in prison in November 2011 on charges of using Kinloch city funds to pay personal expenses, fund personal travel, purchase a Florida vacation condominium timeshare and attempting to influence Kinloch City officials to provide false information to federal law enforcement about the criminal charges pending against him.
Conway was indicted by a federal grand jury on four felony counts of filing false documents.
If convicted, each count carries a maximum penalty of 5 years and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Federal Bureau of Investigation-Public Corruption Unit, including officers of the St. Louis County Police Department. Assistant United States Attorney Hal Goldsmith is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.Former Army Assistant Inspector General Charged with Fraud and Theft of U.S. Army Officers IdentitiesRead the Press Release
James Robert Jones, 42, of Woodlawn, Tennessee was indicted by a federal grand jury today in connection with a scheme to obtain fraudulent bank loans using the stolen identities of active duty and deployed U.S. Army officers, announced David Rivera, Acting United States Attorney for the Middle District of Tennessee.
The indictment charges Jones with aggravated identity theft, bank fraud, and making a false statement to a financial institution.
“This office continues to place a high priority on identity theft crimes,” said Acting United States Attorney David Rivera. “This defendant abused a position of trust and used his position to specifically target those who serve our country, including certain officers who were deployed overseas when he stole their identities. We will seek to hold him accountable for these crimes and for his unlawful attempts to cover them up.”
The indictment alleges that Jones, who was an Assistant Inspector General with the U.S. Army Office of Inspector General at Fort Campbell, abused his position to obtain personal identifying information, including Social Security numbers and dates of birth, of active duty U.S. Army officers, including officers who were deployed to Afghanistan. The indictment also charges Jones fraudulently obtained the personal identifying information of an enlisted soldier who had been killed in combat in Afghanistan and used the personal identifying information of the U.S. Army officers to apply for loans in the officers’ names and successfully obtained fraudulent loans from two financial institutions.
According to the indictment, when confronted by investigators, Jones attempted to conceal his role in this scheme by falsely accusing a deceased U.S. Army officer of planning the scheme. The indictment further alleges that Jones asked a colleague to delete information on his work computer in an effort to impede the ongoing investigation. In connection with this conduct, Jones is charged with obstructing justice and making false statements to investigators.
“The Secret Service remains committed to fighting this type of financial fraud by pursuing individuals who obtain fraudulent loans using stolen identities, especially when the identities belong to members of our armed services,” said Todd Hudson, Special Agent in Charge of the United States Secret Service - Nashville Field Office. “The indictment announced today illustrates how the combined efforts of the Secret Service and our military law enforcement partners help to protect our financial institutions from fraud.”If convicted, Jones faces up to 30 years in prison for the counts of bank fraud and making a false statement to a bank, as well as an additional two years for each count of aggravated identity theft. Jones also faces up to 20 years in prison for attempting to destroy records and 5 years for making false statements to investigators.
The case was investigated by the United States Secret Service and the U.S. Army Criminal Investigations Command. The United States is represented by Assistant U.S. Attorney William F. Abely.
An indictment is merely an accusation and is not evidence of guilt. The defendant is presumed innocent unless and until proven guilty in a court of law.