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28 June 2013
Rosebud Man Charged with False Statement and Theft of Government PropertyRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota, man has been indicted by a federal grand jury for False Statement and Theft of Government Property.
Christopher Menard, age 39, was indicted by a federal grand jury on June 12, 2013. He appeared before U.S. Magistrate Judge Mark A. Moreno on June 25, 2013 and pled not guilty to the indictment. The maximum penalty upon conviction is up to 5 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 Menard is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Department of Interior – Office of Inspector General. Assistant U.S. Attorney Tim Maher is prosecuting the case.
Menard was released on bond pending trial. A trial date has not been set.
Registered Sex Offender Sentenced to 264 Months’ Imprisonment and Lifetime Supervised Release for Transporting Child PornographyRead the Press Release
Earlier today, Edmund Ansbro, a registered sex offender, was sentenced to a term of imprisonment of 264 months and lifetime supervised release following his conviction for transporting child pornography in interstate commerce. The proceeding was held before Senior United States District Judge Denis R. Hurley at the United States Courthouse in Central Islip, New York.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office, and Edward Webber, Commissioner of the Suffolk County Police Department (SCPD).
Ansbro was arrested in Brooklyn on June 10, 2010, as a result of an undercover investigation by a detective with the SCPD Computer Crimes Unit and a special agent with the FBI Sexual Exploitation of Children Unit. According to a complaint filed in federal court, Ansbro admitted at the time of his arrest that he had been trading child pornography for the past six years and had collected approximately 250 gigabytes of child pornography.
New York State records show that Ansbro was convicted on April 4, 2000, in Kings County Supreme Court, of two counts of Sexual Abuse in the First Degree: Sexual Conduct with an Individual Less Than 11 Years Old. Ansbro was sentenced to six months jail and five years’ probation. Following the conviction, Ansbro was required to register as a sex offender with New York State authorities.
“This sentence stands as a strong warning to prior sex offenders that we will prosecute them to the fullest extent of the law,” stated United States Attorney Lynch. “We will not accept the continuing victimization of our children.” Ms. Lynch expressed her grateful appreciation to the Federal Bureau of Investigation and Suffolk County Police Department for their assistance in this case.
The government’s case was prosecuted by Assistant United States Attorney Allen Bode.
The Defendant
EDMUND ANSBRO
Brooklyn, New York
Age: 43Reehahlio Carroll Sentenced to Forty Years for Murdering Catholic Nun During Commission of A Burglary on the Navajo ReservationRead the Press Release
ALBUQUERQUE – Reehahlio Carroll, 21, an enrolled member of the Navajo Nation from Navajo, N.M., was sentenced this afternoon to 40 years in federal prison followed by five years of supervised release for his second degree murder conviction. Carroll also was ordered to pay $8,992.25 in restitution. Carroll’s sentence was announced by U.S. Attorney Kenneth J. Gonzales, Special Agent in Charge Carol K.O. Lee of the Albuquerque Division of the FBI, and John Billison, Director of the Navajo Nation Division of Public Safety.
Carroll was arrested in Nov. 2009, based on federal charges arising out of the murder of Sister Marguerite Bartz of the Order of the Sisters of the Blessed Sacrament, which is part of the Diocese of Gallup, N.M. The murder occurred on Nov. 1, 2009, during the burglary of Sister Bartz’s home on the Saint Berard Mission which is located on the Navajo Indian Reservation. Proceedings in the case were delayed by protracted competency proceedings resulting in a judicial finding that Carroll was competent to stand trial.Sister Bartz’s body was discovered in a pool of blood in the bedroom of her ransacked home, a double-wide trailer located next to the church, on the evening of Nov. 1, 2009, by a nun who was concerned about Sister Bartz’s failure to show up for mass in the Diocese’s church in Sawmill, Ariz. On April 5, 2013, Carroll pled guilty to a felony information charging him with the second degree murder of Sister Bartz. During his plea hearing, Carroll admitted that he killed Sister Bartz at approximately midnight on Nov. 1, 2009, after he broke into a trailer home on the grounds of the Catholic Church in Navajo for the purpose of stealing cash or items that he could readily sell for cash.
According to court records, after Carroll broke a window to gain access to Sister Bartz’s trailer, he rummaged through drawers and cabinets searching for cash and items of value that he could sell for cash or trade for drugs or alcohol. Carroll found a flashlight in a room that he used for illumination as he continued searching for items to steal. When Carroll encountered Sister Bartz in one of the bedrooms and she attempted to defend herself by hitting him with a slipper, he brutally murdered her by beating her repeatedly with a flashlight and then, in an attempt to silence her, strangling her with a t-shirt. The pathologist who performed the autopsy concluded that the cause of death was multiple blunt force head trauma and ligature strangulation.
Carroll was arrested on tribal charges on Nov. 5, 2009, after law enforcement officers learned that he had been observed driving a car that was reported stolen from the Mission’s grounds. Following his arrest, Carroll provided a detailed confession in which he admitted murdering Sister Bartz while burglarizing her home. Carroll remained in tribal custody until he was arrested on federal charges on Nov. 10, 2009.
This case was investigated by the Gallup office of the FBI and the Window Rock Police District of the Navajo Nation Division of Public Safety, with assistance from the New Mexico State Police. It was prosecuted by Assistant U.S. Attorneys Presiliano A. Torrez and Paul H. Spiers.
Pueblo Man Arrested for Tax Evasion, Bank Fraud and Interfering with IRS LawsRead the Press Release
DENVER – Michael Destry Williams, age 49, of Pueblo, Colorado, was arrested without incident on Wednesday, June 26th on charges of tax evasion, structuring, bank fraud, and interfering with IRS laws, the U.S. Attorney’s Office, Internal Revenue Service – Criminal Investigation, Treasury Inspector General for Tax Administration and the U.S. Marshals Service announced. Williams was indicted by federal grand jury in Denver on March 22, 2012, followed by a superseding indictment on July 26, 2012. Both indictments remained under seal until his arrest. The U.S. Marshals with assistance from the Pueblo County Sheriff located and apprehended Williams in Pueblo, Colorado after being on the run for over a year from state and federal charges. Williams was later transported to Denver yesterday for his initial appearance where he was advised of his rights and the charges filed against him. He is due back in court on July 2, 2013 at 2:00 p.m. for arraignment and a detention hearing.
According to the indictment and superseding indictment, Williams was self-employed as a general contractor focusing primarily on residential construction projects, including roofing, remodeling and the repair and restoration of residential structures sustaining fire and water related damage. He was also self-employed as a real estate investor involved in the purchase, renovation and resale (commonly known, as “fixing and flipping”) of residential properties. Williams operated under the name of Greenview Construction, Inc. a Colorado corporation.
From April 2005 and continuing through January 2008, Williams willfully attempt to evade a substantial amount of income tax and self-employment tax due and owing by him to the United States of America for calendar years 2005, 2006 and 2007, among other ways, by failing to file income tax returns and to pay to the IRS income tax and self-employment tax. The indictments allege that Williams established and used trusts as part of his tax evasion scheme. Furthermore, Williams structured over $90,000 in deposited funds from July 2008 through September 2008.
In November or 2009, Williams attempted to defraud a Colorado financial institution by depositing worthless fabricated United States Treasury checks for his own benefit. There were two false treasury checks totaling $55,000 payable to Greenview Construction. In February of 2010, there was a third fabricated United States Treasury check in the amount of $250,000 that Williams attempted to negotiate.From October 2008 through December 2010, Williams mailed numerous frivolous correspondences to the Secretary of the Treasury as well as various IRS offices in an attempt to obstruct and impede the administration of the internal revenue laws. The obstructive efforts, according to the superseding indictment, included attempts by Williams to target State of Colorado judicial officers who had presided over three separate state cases in which Williams was named as a defendant. The superseding indictment alleges, in particular, that Williams sent the IRS criminal referrals accusing one of these judicial officers and the Clerk of the El Paso County District Court with committing criminal tax and related offenses.
Williams was charged with two counts of tax evasion, one count of structuring, two counts of bank fraud, three counts of fictitious obligations and one count of interfering with the administration of internal revenue laws. Tax evasion and structuring carries a penalty of not more than 5 years in federal prison, and a fine of up to $250,000 per count. Bank fraud carries a penalty of not more than 30 years in federal prison, and a fine of up to $1,000,000 per count. Fictitious obligations carries a penalty of not more than 25 years in federal prison, and a fine of up to $1,000,000 per count. Interfering with the administration of internal revenue laws carries a penalty of not more than 3 years in federal prison, and a fine of up to $250,000 per count.
This case was investigated by agents with IRS Criminal Investigation and U.S. Treasury Inspector General for Tax Administration (TIGTA). U.S Marshals with the assistance of the Pueblo County Sheriff’s Office located and apprehended Williams. The case is being prosecuted by Assistant U.S. Attorney Kenneth Harmon.
The charges contained in the indictment are allegations, and the defendant is presumed innocent until proven guilty.
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Pine Ridge Woman Sentenced to 168 Months for Possession with Intent to Distribute MethamphetamineRead the Press Release
United States Attorney Brendan V. Johnson announced that a Pine Ridge, South Dakota woman convicted of Possession with Intent to Distribute a Controlled Substance was sentenced on June 28, 2013 by Chief Judge Jeffrey L. Viken, U.S. District Court.
Victoria Lee Running Hawk, age 31, was sentenced to 168 months’ imprisonment, 4 years' supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
On September 16, 2012, Running Hawk was stopped for speeding on I-90. Law enforcement subsequently discovered she possessed 50 grams or more of methamphetamine, with the intent to distribute. Running Hawk pled guilty to the charge on February 28, 2013.
This case was investigated by the Drug Administration Enforcement, the Unified Narcotics Enforcement Team, and the South Dakota Highway Patrol. Assistant U.S. Attorney Ted L. McBride prosecuted the case.
Running Hawk was immediately turned over to the custody of the U.S. Marshal.
Pine Ridge Man Charged with AssaultRead the Press Release
United States Attorney Brendan V. Johnson announced that a Pine Ridge, South Dakota man was indicted by a federal grand jury for assaulting a woman, fracturing bones in her neck and nose.
Alexander Winter, age 27, was indicted on June 18, 2013 for Assault Resulting in Serious Bodily Injury and Assault Resulting in Substantial Bodily Injury to a Spouse, Intimate Partner, or Dating Partner. Winter appeared before U.S. Magistrate Judge Veronica L. Duffy on June 24, 2013 and pled not guilty to the indictment.
The maximum penalty upon conviction is 10 years’ imprisonment and/or a $250,000 fine. The charges are merely an accusation and Winter is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Office of Justice Services. Assistant U.S. Attorney Eric Kelderman is prosecuting the case.
Winter was released on bond pending trial. A trial date has not been set.
Pierre Man Charged with Failure to Register as A Sex OffenderRead the Press Release
United States Attorney Brendan V. Johnson announced that Adrian Wells, age 37, of Pierre, South Dakota appeared before U.S. District Judge Roberto A. Lange on June 25, 2013 and pled guilty to Failure to Register as a Sex Offender. The maximum penalty upon conviction is 10 years in custody, a $250,000 fine, or both; life of supervised release; and $100 to the Federal Crime Victims Fund.
On December 6, 1995, Wells was convicted of Aggravated Sexual Abuse. The Court sentenced Wells to 63 months in custody and five years of supervised release and also ordered that he register as a sex offender.
On May 19, 2009, Wells signed a lease for an apartment but failed to register the new apartment as his residence. Instead, Wells continued to use his previous address, even though he did not reside there. Wells registered the previous address with law enforcement on five occasions.
The investigation was conducted by the U.S. Marshals Service. The case is being prosecuted by Assistant U.S. Attorney Marie H. Ruettgers.
A presentence investigation was ordered and a sentencing date was set for September 11, 2013. The defendant was remanded to the custody of the U.S. Marshal pending sentencing.
Owner of Landscaping Business in Freeport, N.Y. Pleads Guilty to Tax EvasionRead the Press Release
The Justice Department and the Internal Revenue Service (IRS) announced today that Lawrence Garafola, a resident of Poway, Calif., pleaded guilty to tax evasion.
According to documents filed with the court, Garafola owned and operated A-1 Tree & Shrub Service (ATS), a landscaping business located in Freeport, N.Y. Beginning in approximately 2004 and continuing through approximately 2008, Garafola failed to report to the IRS a substantial portion of income he obtained through payment for services rendered by ATS. Instead of depositing checks to ATS into ATS’s business bank account, Garafola used a commercial check cashing service to cash checks and failed to report that income to his tax return preparer.
Garafola admitted that for tax years 2007 and 2008, he failed to report approximately $1,843,847 of income, resulting in an additional tax due and owing to the government of approximately $516,277.
Garafola faces a maximum sentence of five years in prison, three years of supervised release and a $250,000 fine. He has agreed to pay restitution of $760,637 to the IRS.
The case was investigated by IRS-Criminal Investigation. Trial Attorneys Mark Kotila and Robert Kennedy of the Justice Department’s Tax Division are prosecuting this case.
Owner of Rehabilitation Facility Pleads Guilty to Mail Fraud ChargeRead the Press Release
SANTA ANA, California – The owner and chief executive officer of a comprehensive outpatient rehabilitation facility pleaded guilty today to mail fraud for submitting claims to Medicare for services that were not prescribed by treating doctors.
Tuan Duc Tran, 53, of Westminster, pleaded guilty before United States District Judge Josephine Staton Tucker.
This case involves Medicare billings by Fountain Valley Healthcare Center (FVHC), a rehabilitation facility that Tran operated. Tran admitted that he submitted bills to Medicare based on false claims that Medicare beneficiaries had been referred to FVHC for physical and respiratory therapy. These claims for payment violated Medicare rules because, as Tran acknowledged, the treating doctors had not referred the beneficiaries for rehabilitation.
Pursuant to a plea agreement, Tran will be required to pay $777,291 in restitution to Medicare.
Judge Tucker scheduled Tran’s sentencing for November 8.
The mail fraud count carries a maximum statutory sentence of 20 years in federal prison.
Release No. 13-089
Owner of Nellie’s Provisions Sentenced to Four Months in Prison for Tax EvasionRead the Press Release
CAMDEN, N.J. – The owner of a meat distribution company was sentenced today to four months in prison and four months of house arrest for evading taxes related to income diverted from his companies for his personal use, U.S. Attorney Paul J. Fishman announced.
Nicholas Papanier Sr., 57, of Sewell, N.J., previously pleaded guilty before U.S. District Judge Noel L. Hillman to an information charging him with one count of tax evasion. Judge Hillman imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Between 2006 and 2009, Papanier owned Nellie’s Provisions, a meat distribution company that provided all of the meat for Primo Hoagies franchises and other independent restaurants. In 2006, 2007 and 2008, Papanier persuaded Primo Hoagies franchise owners to buy Thumann’s deli products from Nellie’s Provisions, often paying for them in cash. He took a significant amount of the cash paid to Nellie’s Provisions and deposited it into his personal bank accounts. He then used the money from his personal accounts to pay personal expenditures. He diverted a total of $556,664 for the calendar years 2006, 2007 and 2008 in the amounts of $56,395, $349,264, and $151,005, respectively.
Papanier admitted that he did not report the diverted cash to the IRS and only reported Form W-2 wages, interest and dividend income, and property tax information. By omitting all of the diverted cash, he failed to disclose and report a significant portion of this income on his tax returns, causing those tax returns to substantially understate the amount of income he received.
He admitted that for 2006, 2007 and 2008, had he reported the additional cash on his income tax returns he would have owed the government $189,656.
As part of the plea and in addition to the restitution, Papanier agreed to forfeit $484,010 to the United States. On Oct. 14, 2009, the United States filed a Verified Complaint for Forfeiture In Rem to forfeit and condemn to the use and benefit of the United States $372,042.54 in United States currency that was seized from Papanier’s bank accounts. On Sept. 16, 2010, the United States filed another Verified Complaint for Forfeiture In Rem to forfeit and condemn to the use and benefit of the United States an additional $111,967.50 in United States currency that was seized from Papanier’s bank accounts. The Complaints alleged that the subject funds were subject to forfeiture to the United States because they were involved in and were traceable to Structuring of Currency to Avoid a Reporting Requirement.
In addition to the prison term, Judge Hillman sentenced Papanier to two years of supervised release – which includes four months of house arrest – and fined him $10,000.
U.S. Attorney Fishman credited special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s sentence.
The government is represented by Assistant U.S. Attorneys Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden in the criminal case, and Jordan Anger of the U.S. Attorney’s Office Asset Forfeiture Unit in Newark in the civil action.
13-271
Defense counsel: Ronald Warren Esq., Haddonfield, N.J.
Owner of Nellie’s Provisions Sentenced to Four Months in Prison for Tax EvasionRead the Press Release
CAMDEN, N.J. – The owner of a meat distribution company was sentenced today to four months in prison and four months of house arrest for evading taxes related to income diverted from his companies for his personal use, U.S. Attorney Paul J. Fishman announced.
Nicholas Papanier Sr., 57, of Sewell, N.J., previously pleaded guilty before U.S. District Judge Noel L. Hillman to an information charging him with one count of tax evasion. Judge Hillman imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Between 2006 and 2009, Papanier owned Nellie’s Provisions, a meat distribution company that provided all of the meat for Primo Hoagies franchises and other independent restaurants. In 2006, 2007 and 2008, Papanier persuaded Primo Hoagies franchise owners to buy Thumann’s deli products from Nellie’s Provisions, often paying for them in cash. He took a significant amount of the cash paid to Nellie’s Provisions and deposited it into his personal bank accounts. He then used the money from his personal accounts to pay personal expenditures. He diverted a total of $556,664 for the calendar years 2006, 2007 and 2008 in the amounts of $56,395, $349,264, and $151,005, respectively.
Papanier admitted that he did not report the diverted cash to the IRS and only reported Form W-2 wages, interest and dividend income, and property tax information. By omitting all of the diverted cash, he failed to disclose and report a significant portion of this income on his tax returns, causing those tax returns to substantially understate the amount of income he received.
He admitted that for 2006, 2007 and 2008, had he reported the additional cash on his income tax returns he would have owed the government $189,656.
As part of the plea and in addition to the restitution, Papanier agreed to forfeit $484,010 to the United States. On Oct. 14, 2009, the United States filed a Verified Complaint for Forfeiture In Rem to forfeit and condemn to the use and benefit of the United States $372,042.54 in United States currency that was seized from Papanier’s bank accounts. On Sept. 16, 2010, the United States filed another Verified Complaint for Forfeiture In Rem to forfeit and condemn to the use and benefit of the United States an additional $111,967.50 in United States currency that was seized from Papanier’s bank accounts. The Complaints alleged that the subject funds were subject to forfeiture to the United States because they were involved in and were traceable to Structuring of Currency to Avoid a Reporting Requirement.
In addition to the prison term, Judge Hillman sentenced Papanier to two years of supervised release – which includes four months of house arrest – and fined him $10,000.
U.S. Attorney Fishman credited special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s sentence.
The government is represented by Assistant U.S. Attorneys Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden in the criminal case, and Jordan Anger of the U.S. Attorney’s Office Asset Forfeiture Unit in Newark in the civil action.
13-271
Defense counsel: Ronald Warren Esq., Haddonfield, N.J.
Omaha Woman Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Deborah R. Gilg announced that on June 27, 2013, the Honorable Joseph F. Bataillon, U.S. District Court Judge, sentenced Maria Terrazas, age 38, of Omaha, to 156 months imprisonment for her role in a conspiracy to distribute methamphetamine. Following the prison term, Terrazas will serve five years on supervised release.
In 2011, the Omaha Police Department began investigating Maria Terrazas for conspiring with others to distribute over 4000 grams of methamphetamine. In May, 2012, an undercover agent with the Bureau of Alcohol, Tobacco, Firearms, and Explosives began buying methamphetamine directly from Terrazas. During the execution of a search warrant on Terrazas’s residence on July 16, 2012, officers found over four pounds of methamphetamine. Terrazas was also in possession of a firearm at that time.
The matter was investigated by the Omaha Police Department and the ATF.North Dakota Woman Pleads Guilty to Possession with Intent to Distribute A Controlled SubstanceRead the Press Release
United States Attorney Brendan V. Johnson announced that April Pretends Eagle, age 31, of Fort Yates, North Dakota appeared before U.S. Magistrate Judge Mark A. Moreno on June 25, 2013 and pled guilty to Count III of the Indictment that charged her with Possession with Intent to Distribute a Controlled Substance.
The maximum penalty upon conviction is 5 years of imprisonment, a $250,000 fine, or both; at least 2 years of supervised release and an additional term of up to 2 years of supervised release upon revocation. Restitution and a $100 special assessment to the Federal Crime Victims Fund may also be ordered.
The charge stems from an investigation of burglaries in Eagle Butte, South Dakota. Based on information developed during the investigation, a criminal investigator with the Cheyenne River Sioux Tribe obtained a tribal search warrant for co-Defendant Philip LaBatte’s residence, where Pretends Eagle was staying. When law enforcement executed the search warrant, they found at least 250 grams, but less than 1 kilogram, of marijuana along with a scale, rolling papers, and a grinder. LaBatte’s residence was in Eagle Butte.
The investigation was conducted by the Cheyenne River Sioux Tribe Law Enforcement Division and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Kathryn N. Rich is prosecuting the case.
Pretends Eagle was released on bond pending sentencing which has been set for September 11, 2013.
New Boston, Texas Woman Indicted for Ricin LettersRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – A 35-year-old New Boston, Texas woman has been indicted and charged with federal violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales.
Shannon Guess Richardson was named in a three-count indictment returned by a federal grand jury on June 27, 2013. The indictment charges Richardson with threatening the President of the United States, mailing a threatening letter to New York City Mayor Michael Bloomberg, and mailing a threatening letter to Mark Glaze.According to the indictment, on or about May 20, 2013, Richardson is alleged to have mailed three threatening letters containing the toxin ricin. The letters were sent to President Barack Obama and Mark Glaze in Washington, D.C., and to Mayor Michael Bloomberg in New York City. Richardson was arrested on June 7, 2013, in Mt. Pleasant, Texas, and has been detained since that time.
If convicted, Richardson faces up to five years in federal prison on each charge.
This case is being investigated by the Federal Bureau of Investigation, the U.S. Secret Service, the U.S. Postal Inspection Service, the Texas Department of Public Safety, the New Boston, Texas Police Department, and the Shreveport, Louisiana Police Department. This case is being prosecuted by Assistant U.S. Attorneys Brit Featherston, Frank Coan, and Ryan Locker.
It is important to note that an indictment should not be considered as evidence of guilt and that all persons charged with a crime are presumed innocent until proven guilty beyond a reasonable doubt.
Ms-13 Street Gang Leader Sentenced to 365 Months’ Imprisonment for 2009 Murder and Attempted MurderRead the Press Release
Earlier today, United States District Judge Joseph F. Bianco sentenced Jose Gustavo Orellana-Torres, also known as “Diablito,” the former leader of the Coronados clique of La Mara Salvatrucha, also known as the MS-13 street gang, to 365 months’ imprisonment following his September 25, 2012 guilty plea to racketeering, including predicate acts relating to the May 26, 2009 murder of Dexter Acheampong in Central Islip, New York, and the July 5, 2009 attempted murder of a suspected rival gang member in Roosevelt, New York.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office, and Thomas V. Dale, Commissioner of the Nassau County Police Department.
According to his plea allocution and documents previously filed in the case, on May 26, 2009, Orellana-Torres attended a Coronados clique meeting in Brentwood, New York, and the MS-13 members agreed to “put in work” for the gang by killing rival gang members. Orellana-Torres and several other MS-13 members drove around Brentwood and Central Islip looking for rival gang members, and Orellana-Torres was armed with a .38 caliber revolver. While in the vicinity of East Maple Street in Central Islip, the MS-13 members observed Dexter Acheampong, whom they did not know, but believed, based on the color of his skin and the neighborhood he was walking in, to be a member of the Bloods street gang. In fact, Mr. Acheampong did not belong to any street gang. Orellana-Torres stepped out of the car and fired four shots at Mr. Acheampong with the .38 caliber revolver, striking the victim twice in the back as he tried to escape. Mr. Acheampong was found dead in the driveway of a home on East Maple Street the next morning.
Just over a month later, on July 4-5, 2009, Orellana-Torres attended another MS-13 meeting, this time in Roosevelt, New York. The MS-13 members again discussed killing rival gang members. Orellana-Torres, who possessed the same .38 caliber revolver that night, and other MS-13 members drove around Roosevelt, New York, looking for rival gang members. The MS-13 members observed a man, whose identity is known to the government but is not being disclosed in order to protect his safety, whom they believed to be a rival gang member. One of the other MS-13 members fired several shots at the man, striking him once in the hand.
“The MS-13 street gang has become infamous for its senseless and depraved acts of violence, but even for the MS-13, these vicious crimes demonstrated exceptional depravity. Orellana-Torres and his co-conspirators targeted Dexter Acheampong and another young man, whom they did not even know, because they believed them to be rival gang members,” stated United States Attorney Lynch. “This sentence should make clear that gang members will pay a heavy price for such cold, calculated acts of violence.”
FBI Assistant Director-in-Charge Venizelos stated, “We cannot overstate our commitment to investigating MS-13 and other gangs on Long Island. As the case of Orellana-Torres shows, MS-13 is not about ethnic pride, it is a violent, murderous horde. It is hard to imagine a more wanton disregard for human life than shooting a person in the back because the color of his skin makes you think a may be a rival gang member.”
Orellana-Torres’s conviction is the latest in a series of federal prosecutions by this Office targeting New York members of the MS-13, a violent international street gang comprised primarily of immigrants from El Salvador, Honduras and Guatemala. With numerous branches, or “cliques,” the MS-13 is the largest street gang on Long Island. Since 2002, more than 200 MS-13 members, including more than two dozen clique leaders, have been convicted on federal felony charges in the Eastern District of New York. More than 100 of those MS-13 members have been convicted on federal racketeering charges. Since 2010 alone, this Office has convicted more than 30 members of the MS-13 on charges relating to their participation in one or more murders. These prosecutions are the product of investigations led by the FBI’s Long Island Gang Task Force, comprising agents and officers of the FBI, Nassau County Police Department, Nassau County Sheriff’s Department, Suffolk County Probation, Suffolk County Sheriff’s Department and the Rockville Centre Police Department.
The government’s case was prosecuted by Assistant United States Attorneys John J. Durham, Raymond A. Tierney and Carrie N. Capwell.
The Defendant
JOSE GUSTAVO ORELLANA-TORRES (“Diablito”)
Age: 28Monroe County Residents Charged for Illegal Harvest and Sale of Marine LifeRead the Press Release
Wifredo A, Ferrer, United States Attorney for the Southern District of Florida, Otha Easley, Acting Special Agent in Charge for the National Oceanic and Atmospheric Administration (NOAA), Office of Law Enforcement, Southeast Division, and David G. Pharo, Resident Agent in Charge, U.S. Fish & Wildlife Service (FWS), Office of Law Enforcement, announced the filing of criminal charges against Key Marine, Inc., a Florida corporation with its principal place of business on Grassy Key, Eric P. Pedersen, 51, and Serdar Ercan, 42, both residents of Monroe County, Florida. The single-count Information alleges that the three defendants engaged in a conspiracy to take, harvest, capture, transport, and sell various species of marine wildlife harvested from the Florida Keys National Marine Sanctuary (FKNMS) and State waters, for commercial sale and distribution in interstate and foreign commerce to their financial gain, in violation of the laws and regulations of the State of Florida, and the federal Lacey Act, Title 16, United States Code, Sections 3372(a)(1),(a)(2)(A), and (4), and 3373(d)(1), all in violation of Title 18, United States Code, Section 371. Initial court appearances on the charges have not yet been set.
The case has been assigned to U.S. District Judge Jose E. Martinez. If convicted on the charge, Key Marine, Inc. faces a possible fine of $500,000 or twice the gross pecuniary gain or loss arising from the relevant conduct. Defendants Pedersen and Ercan each face a statutory maximum sentence of up to five years in prison.
According to the Information, from October 2010 through February 2011, the defendants engaged in the day to day business of collecting, exporting, and selling in interstate and foreign commerce various species of marine life, including Live Rock and attached invertebrates, specifically Ricordia florida, sea fans (Gorgonia species); bonnethead sharks (Sphyma tiburo); lemon sharks (Negaprion brevirostris); and nurse sharks (Ginglymostoma cirratum), with market values in excess of $350.00, knowing that the marine life was taken and intended to be sold in violation of the laws and regulations of the State of Florida. The Information further charges that the defendants exceeded the legal limit on the harvest of Ricordia florida as part of their illicit harvesting activities.
Pursuant to the Florida Keys National Marine Sanctuary and Protection Act and the National Marine Sanctuary Act, the National Oceanic & Atmospheric Administration issued final regulations in January 1997 to govern the conduct of activities within the sanctuary. Title 15, Code of Federal Regulations, Section 922.163(a)(2) prohibits the removal of, injury to, or possession of coral or live rock. Section 922.163(a)(2)(I) prohibits moving, removing, taking, harvesting, damaging, disturbing, breaking, cutting, or otherwise injuring any living or dead coral or coral formation, or attempting any of these activities.
Florida Administrative Code, Section 68B-42.008, prohibits the harvest of live rock. Florida Statue 370.07 requires that a person who sells salt water marine related wildlife such as Ricordia florida, to hold a State wholesale and retail license. The federal Lacey Act, among other things, makes it unlawful for any person to import, export, transport, sell, receive, acquire, or purchase in interstate or foreign commerce, any fish or wildlife, taken, possessed, transported, or sold in violation of any law or regulation of any State. 16 U.S.C. §3372(a)(2)(A). According to the allegations in this case, the defendants were not authorized by any competent authority to harvest or attempt to harvest any Live Rock from the FKNMS or State waters during the time period relevant to this Information, nor did they hold the marine-related wholesale and retail permits required by Florida Statute 370.07.
Mr. Ferrer commended the investigative efforts of the Special Agents of NOAA-OLE and FWS-OLE in this case. The case is being prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald.
An Information is only an accusation and a defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
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.
Michigan Man Sentenced in Fraudulent Test Kit SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Allison C. Lerner, Inspector General, National Science Foundation (NSF), and Ronald Verrochio, Postal Inspector in Charge, U.S. Postal Inspection Service (USPIS), Miami Division, announced that Alexander Lorin Davis, 40, of Pinckney, Michigan, was sentenced yesterday in federal District Court in West Palm Beach on charges related to falsely making and forging the seal of the National Science Foundation (NSF), an agency of the United States, and mail fraud in connection with the marketing by internet to the public of environmental test kits that were not in fact analyzed by qualified laboratories as asserted in advertisements and literature accompanying the kits, in violation of Title 18, United States Code, Sections 506(a)(1), 1341, 4, and (2).
U.S. District Judge Kenneth Ryskamp, who had previously accepted guilty pleas in this matter from Alexander Davis and his spouse, Dawn Marie Davis, 46, also of Pinckney, sentenced Alexander Davis to 15 months in prison, to be followed by three years of supervised release. Judge Ryskamp also ordered Alexander Davis to pay $50,264.53 in restitution to 154 victims of the fraudulent scheme. Dawn Davis, who previously pled guilty to a charge of misprision of a felony for failing to alert appropriate authorities to the criminal conduct, was sentenced by Judge Ryskamp to two years of probation and was ordered to pay restitution in the amount of $9,596.09 after a hearing held on April 25, 2013.
According to court records, including Joint Factual Statements submitted to the Court and statements made during the sentencing hearing, from May 2011 through November 2012, Alexander Davis owned and operated Davis Test Kits (DTK). DTK was in the business of marketing test kits for use in homes and businesses to detect the presence of various environmental pollutants and hazards, such as molds, asbestos, radon, and lead. To promote business, the DTK website displayed the forged and counterfeited seal of the NSF. As part of the scheme, Alexander Davis also made materially false representations and promises on the website, claiming that, upon return of the test kit by the customer, DTK would cause the kit to be submitted for testing by individuals from an established, accredited laboratory.
In fact, however, DTK did not operate or employ testing laboratories certified as represented on the website and many test kits returned to DTK were never submitted for testing by an accredited laboratory. To perpetuate the fraud, the defendants would mail customers whose test kits had not been tested results from other laboratory tests. Some, customers were induced to pay additional amounts, in some instances exceeding thousands of dollars, based on false assertions by the defendants that additional testing was necessary.
During the same time, Dawn Davis was aware that her husband was using the seal of the NSF on the internet website of DTK and knew the company was marketing the test kits. She was also aware that DTK did not submit all the customer test kits received through the mail to accredited laboratories for analysis as DTK represented on its website and in written materials provided to the customers. Despite her knowledge, Dawn Davis concealed the fact that DTK was selling its testing services without any affiliation or connection to NSF, and was failing to provide the purchased testing services to some customers.
The National Science Foundation is an independent federal agency established by Congress in 1950 to promote the progress of science and to advance the national health, prosperity, and welfare. The agency meets this mission by funding approximately 20% of all federally supported basic research conducted by America’s colleges and universities with an annual budget of approximately $6.9 billion. The National Science Foundation neither tests consumer products, nor audits and inspects private laboratories.
Mr. Ferrer commended the investigative efforts of the National Science Foundation Office of Inspector General and the U. S. Postal Inspection Service. The criminal case is being prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald.
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.
Maryland Man Sentenced to 26 Years in Prison for August 2011 Slaying in Northeast Washington-Defendant Chased Victim and Shot Him Numerous Times-Read the Press Release
WASHINGTON – Ricardo Mitchell, 33, of Temple Hills, Md., was sentenced today to 26 years in prison on a charge of second-degree murder while armed in a slaying that took place in August 2011 in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Mitchell pled guilty in April 2013 in the Superior Court of the District of Columbia to the murder charge as well as a charge of possession of a firearm during a crime of violence. He was sentenced by the Honorable Lynn Leibovitz. Upon completion of his prison term, Mitchell is to be placed on five years of supervised release.
According to the government’s evidence, in the early evening of Aug. 21, 2011, Mitchell was outside a residence in the 3900 block of Clay Place NE when he exchanged words with the victim, Wyatt Earp Robinson. Mr. Robinson, 33, walked away. Mr. Robinson headed toward his vehicle, where his girlfriend and four-year-old child were waiting.
Mitchell then ran into the residence. He returned outside and ran from the front porch of the house with a gun in his hand and up the sidewalk, toward Minnesota Avenue, and after Mr. Robinson. He caught up with Mr. Robinson when the victim was approximately five feet from his vehicle. At that point, Mitchell confronted Mr. Robinson and shot him several times.
After shooting Mr. Robinson, who had nothing in his hands but his cellphone, the defendant began to walk away, but turned back toward the victim and fired another shot at him. A total of nine .40-caliber cartridge casings were found on the scene by police, and all were fired from the same firearm. An autopsy revealed nine gunshot wounds to Mr. Robinson’s body.
Following the shooting, Mitchell fled into and through the residence on Clay Street NE. He exited through the residence’s back door and fled the scene on a motorcycle.
After shooting and killing Mr. Robinson, Mitchell fled to a storage facility in Forestville, Md., where he hid the motorcycle that he used to flee the crime scene. The defendant is captured on surveillance footage from that storage facility wearing the same clothes that he was seen wearing at the time of the murder. Mitchell was arrested on Aug. 24, 2011.
In announcing the sentence, U.S. Attorney Machen commended the work of the detectives, officers and crime scene technicians who investigated the case for the Metropolitan Police Department (MPD). He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Criminal Investigators Durand Odom and Zachary McMenamin, Victim/Witness Advocate Marcia Rinker, and Paralegal Specialists Mia Beamon, Kendra Johnson, Marian Russell and Phaylyn Hunt. Finally, he expressed appreciation for the work of Assistant U.S. Attorneys Reagan M. Taylor, Teresa Howie and Stephen J. Gripkey, who prosecuted the matter.
13-234Maryland Man Found Guilty of First-Degree Murder While Armed in 2010 Killing Inside Downtown Office Building-Defendant Later Disposed of Body in Frederick County, Md.-Read the Press Release
WASHINGTON - Marvin Palencia, 38, of Hyattsville, Md., was found guilty by a jury today of first-degree murder while armed and other charges stemming from the slaying of a man in a downtown office building, U.S. Attorney Ronald C. Machen Jr. announced.
The verdict followed a trial in the Superior Court of the District of Columbia. In addition to the murder charge, the jury found Palencia guilty of possession of a firearm during a crime of violence, carrying a pistol without a license, and tampering with evidence. The Honorable John Ramsey Johnson scheduled sentencing for Oct. 11, 2013.
According to the government’s evidence, on Nov. 11, 2010, Palencia shot the victim, Jacobo Vazquez, 36, in the chest and in the back of the head in the laundry room of a ten-story office building in the 100 block of Constitution Avenue NW, where both of the men worked. Palencia was angry because Mr. Vazquez was in a relationship with the defendant’s wife. Palencia and his wife were separated but he hoped for a reconciliation.
Prior to the murder, Valencia shared with several people how upset he was with Mr. Vazquez. He also threatened Mr. Vazquez about one week before the murder – telling him that he better not see him at work anymore. Over the course of the next week, Palencia purchased a firearm illegally and verified Mr. Vazquez’s work schedule with his superior.
The government’s evidence showed that Palencia carefully planned out the timing and location of the murder by using his knowledge of the building and the various employee schedules. After killing Mr. Vazquez, Palencia put the body in a cardboard box, wrapped the box in duct tape, plastic, and a cord, and then dumped the body on the side of the road on Interstate 70 in Frederick County, Md. However, in his haste to wrap the box, he unknowingly attached his work identification card to the box. Palencia was arrested Nov. 20, 2010 and has been in custody ever since.
“Thanks to the efforts of law enforcement from the District of Columbia and Maryland and a dedicated prosecution team, Marvin Palencia was brought to justice for this calculated killing of a co-worker inside an office building within blocks of the U.S. Capitol,” said U.S. Attorney Machen. “We hope this verdict brings some measure of relief to the family of Mr. Vazquez.”
In announcing the verdict, U.S. Attorney Machen praised the work of the detectives, officers and evidence technicians who investigated the case from the Metropolitan Police Department (MPD). He also expressed appreciation for the assistance provided by the Maryland State Police, the Maryland State Highway Department and the Maryland State Medical Examiner’s Office. He acknowledged the efforts of those who worked on the case form the U.S. Attorney’s Office, including Paralegal Specialists Marian Russell and Kalisha Johnson-Clark; Intern Matt Lamb, and Litigation Technology Specialists Kimberly Smith and Thomas “Ron” Royal. He thanked Assistant U.S Attorney Seth B. Waxman, who investigated the case, and Assistant U.S. Attorney Emily Miller, who investigated the case and secured the indictment.
Finally, he commended the work of Assistant U.S. Attorneys Nicholas Cannon and Kevin Flynn, who prosecuted the case at trial.
13-236Man Sentenced for Elaborate Identity Theft SchemeRead the Press Release
A man who stole hundreds of identities – many by skimming debit card numbers from gasoline pumps around San Diego - was sentenced today to more than three years in prison and ordered to pay $521,800 in restitution to victims.
Akop Taymizyan, 37, pleaded guilty in January, 2013, to conspiracy to commit access device fraud and bank fraud and aggravated identity theft. A co-conspirator, Georgi Rushanyan, pleaded guilty to the same charges and was sentenced to 48 months in custody on April 27, 2012.
During today’s hearing, U.S. District Judge Dana M. Sabraw called the thefts a “highly sophisticated conspiracy” and “a drain on society’s resources.”
Assistant U.S. Attorney Sabrina Feve, in urging the court to impose a lengthy sentence, noted that Taymizyan continued to steal even after his co-conspirator was taken into custody. “Even Rushanyan’s arrest and prosecution did not deter the conspiracy from continuing to steal and make unauthorized use of victims’ debit card numbers and PINs,” Feve wrote in court documents.
The charges against Taymizyan arose from his involvement in a scheme to steal and use victims’ debit card numbers and personal identification numbers (PINs). Beginning in or about December 2009, the conspiracy installed skimming devices inside gas pumps located in California, Arizona, and Nevada. These devices surreptitiously recorded victims’ debit card numbers and PINs.
The conspiracy then re-encoded the stolen debit card numbers onto dummy magnetized access cards and affixed the matching PIN via a sticker. Taymizyan, along with other co-conspirators, then traveled around California, Arizona, Nevada, Texas, and Georgia making unauthorized withdrawals from victims’ bank accounts. The withdrawals were for both cash and US Postal stamps.
The conspiracy stole debit card numbers and PINs for over 400 bank accounts belonging to at least six banks, and over 8,800 “Forever” stamps. To date, the conspiracy has made over $500,000 in unauthorized withdrawals.
Gas pumps in and around San Diego were targeted as part of this scheme and at least 30 bank accounts belonging to San Diego-area victims were compromised. Members of the conspiracy, including Taymizyan, also traveled to San Diego to make unauthorized withdrawals. In February 2010, Taymizyan made an unauthorized withdrawal from a La Jolla ATM.
“Identity theft is a pervasive and growing threat to consumers and financial institutions,” said U.S. Attorney Laura Duffy. “The U.S. Attorney’s Office recommends that individuals monitor their monthly bank, credit card, and brokerage account statements for unauthorized charges and immediately report any unauthorized charges or transfers to their financial institutions.”
DEFENDANT Case Number: 12cr4134-DMS Akop Taymizyan SUMMARY OF CHARGESConspiracy to Commit Access Device Fraud and Bank Fraud - Title 18, United States Code, 371
AGENCIES
Maximum penalties: 5 years' imprisonment and $250,000 fine
Aggravated Identity Theft - Title 8, United States Code, Sections 1028A
Mandatory sentence: 2 years’ imprisonmentUnited States Secret Service, Las Vegas Metropolitan Police Department; Cobb County, Georgia District Attorney’s Office
Lubbock Man Admits Committing PerjuryRead the Press Release
LUBBOCK, Texas — Ernesto Garcia, 59, of Lubbock, Texas, appeared this morning before U.S. District Judge Sam R. Cummings and pleaded guilty to one count of perjury, stemming from his sworn testimony in a detention hearing held in May 2012 in federal court in Lubbock, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas. Garcia faces a maximum statutory penalty of five years in federal prison and a $250,000 fine. Judge Cummings ordered a presentencing investigation report with a sentencing date to be set after the completion of that report. Garcia has been in federal custody since his arrest in late May 2012.
According to the factual resume filed in the case, on April 16, 2013, the U.S. filed a Motion to Detain defendant Pena, in the case of U.S. v. San Juanita “Janie” Pena, Case No. 5:12-CR-024-C(2). In that case, defendant Pena was charged with conspiracy to commit tax fraud and false statements, and numerous substantive counts of the same. One of the government’s main allegations was that Pena had no home, residence, or place to live or go if she were released. Pena contested the motion and a detention hearing was held on May 2, 2012.
During that hearing, according to the factual resume, Pena called Garcia as a witness to testify on her behalf. After being sworn in, Garcia testified that he had known Pena for 10 to 12 years and that he could be responsible for her if she were released into his custody. On cross-examination, in response to questions posed to him, Garcia testified that he did not have a criminal record. In fact, Garcia well knew that he did have a criminal record, having been convicted in 1993 in Iowa for possession of a controlled substance.
The case is being investigated by Internal Revenue Service Criminal Investigation. Assistant U.S. Attorney Paulina Jacobo is in charge of the prosecution.
Local Oncology Practice Sentenced to Pay Millions for Medicare FraudRead the Press Release
The La Jolla oncology practice known as Joel I. Bernstein, M.D., Inc. was sentenced today to pay a $500,000 fine, forfeit $1.2 million and make restitution to Medicare in the amount of $1.7 million for purchasing unapproved foreign cancer drugs and billing Medicare as if the drugs were legitimate.
The sentence was handed down by U.S. District Judge Cathy A. Bencivengo following the corporation’s guilty plea to health care fraud in January. The practice was also sentenced to a year of probation, which means it must allow Probation officers to scrutinize finances, submit to office searches and prepare a compliance program to avoid such problems in the future.
In pleading guilty, the practice admitted that it had purchased $3.4 million of foreign cancer drugs, knowing they had not been approved by the U.S. Food and Drug Administration for use in the United States. From 2007 to 2011, Bernstein’s office purchased these drugs for significantly less than market value in the U.S., and then submitted claims to Medicare at the full reimbursement price. To conceal the scheme, the office fraudulently used Medicare reimbursement codes for approved cancer drugs, as Medicare does not pay for unapproved drugs.
The drugs purchased by the corporation were meant for markets outside the United States and contained the same active ingredients as drugs sold in the U.S. under the brand names Abraxane®, Alimta®, Aloxi®, Boniva®, Eloxatin®, Gemzar®, Neulasta®, Rituxan®, Taxotere®, Venofer® and Zometa®).
The practice has admitted that it was aware that the drugs were intended for markets other than the United States and were not the drugs approved by the FDA for use in the United States because: (a) the packaging and shipping documents indicated that drugs were shipped to the office from outside the United States; (b) many of the invoices identified the origin of the drugs and intended markets for the drugs as countries other than the United States; (c) the labels did not bear the “Rx Only” language required by the FDA; (d) the labels did not bear the National Drug Code (NDC) numbers found on the versions of the drugs intended for the U.S. market; (e) many of the labels had information in foreign languages; (f) the drugs were purchased at a substantial discount; (g) the packing slips indicated that the drugs came from the United Kingdom; and (h) the office had received a Notice from the FDA in October, 2008, that a shipment of drugs had been detained because the drugs were unapproved.
Medicare provides reimbursement only for drugs approved by the Food and Drug Administration (FDA) for use in the United States. The practice admitted that it knowingly submitted claims for payment to Medicare using the reimbursement codes for the U.S. approved drugs, falsely representing that the drugs were those approved by the FDA for use on patients in the United States.
The defendant acknowledged that between January of 2007, and May of 2011, the practice received $1.7 million in reimbursement from Medicare as a result of this fraudulent scheme. The practice was ordered to forfeit $1.2 million, which was the amount of gross proceeds received by the defendant solely related to the drugs.
In a related False Claims Act lawsuit filed by the United States, Dr. Bernstein and his medical practice paid in excess of $2.2 million to settle allegations that they submitted false claims to the Medicare program. The corporation was allowed to apply that sum toward the amount owed in the criminal restitution to Medicare.
Dr. Bernstein himself also pleaded guilty to a misdemeanor charge of Introducing Unapproved Drugs into Interstate Commerce. In pleading guilty, Dr. Bernstein admitted that on July 8, 2010, he purchased the prescription drug Mabthera (intended for market in Turkey and shipped from a source in Canada) and administered it to patients. Bernstein further acknowledged that the drug Mabthera is not approved by the Food and Drug Administration for use in the United States. Rituxin®, a product with the same active ingredient, is approved by the Food and Drug Administration for use in the United States.
Dr. Bernstein was released on a $10,000 personal surety bond and is scheduled to be sentenced on July 2, 2013 at 2:00 p.m.
DEFENDANT Criminal Case No. 13cr0119-CAB Joel I. Bernstein, M.D., Inc. Date of Incorporation: 1998 La Jolla, California SUMMARY OF CHARGESHealth Care Fraud, in violation of Title 18, United States Code, Sections 1347 and 2 Maximum Penalty for a Corporation: $500,000 fine, $400 special assessment.
AGENCIESFood and Drug Administration, Office of Criminal Investigations
Federal Bureau of InvestigationLocal Man Gets Prison Sentence, Ordered to Pay Restitution in Scheme That Defrauded His SiblingsRead the Press Release
PITTSBURGH, Pa. - A resident of Allegheny County has been sentenced in federal court to 18 months of incarceration, restitution of $117,307.77, and three years of supervised release on his conviction of False Statements, United States Attorney David J. Hickton announced today.
United States District Judge Terrence F. McVerry imposed the sentence on William R. Cook, Sr., 34.
According to the information presented to the court, the facts put on the record to support the guilty plea were that Clarence Williams, the father of the defendant, was a Postal Service employee who had Federal Employees Group Life Insurance (FEGLI). Mr. Clarence Williams designated his four children as his beneficiaries to each receive an equal share of the payout. Without the knowledge or consent of his siblings, the defendant filled out federal forms purporting to be his sister and two brothers. The forged forms directed that the payout monies all be sent to the defendant's address. The defendant did collect and spend the monies intended for his three siblings. When the fraud was discovered the government paid each of the three siblings $39,102.59 thus incurring a loss in the total amount of $117,307.77.
Prior to imposing sentence, Judge McVerry provided Cook with an opportunity to address his siblings seated in court. With a quivering voice and trembling chin, Cook apologized for the embarrassment and pain he caused. Judge McVerry stated he was moved by the apology, but nevertheless imposed a sentence in the middle of the guidelines range of 15 to 21 months. Judge McVerry noted that although this was a non-violent offense, stealing is a serious offense. Judge McVerry observed that the several previous crimes committed by Cook and the resulting sentences of probation had not impressed Cook with the need follow the law. Judge McVerry stated, "I urge you to become a productive member of society and a positive role model for your 11 year old son. There is nothing more important in life than being a role model for your son." The court imposed a three-year period of supervised release to be served after release from jail. During supervised release Cook is required to participate in an alcohol and drug aftercare program, undergo a mental health assessment and treatment program, and contribute to the costs of these programs. Judge McVerry explained that "these programs are not to slap you on the face; they are to keep you on the right track." Judge McVerry also ordered that 50 percent of Cook's prison salary be used to pay restitution.
Assistant United States Attorney Nelson P. Cohen prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the U.S. Office of Personnel Management, Office of Inspector General, for the investigation leading to the successful prosecution of William R. Cook.
Lake County Man Indicted for MurderRead the Press Release
SAN FRANCISCO - A federal grand jury in San Francisco has returned a superseding indictment against Jonathan Mota, 31, for murder caused by a firearm; for Hobbs Act robbery, a crime of violence; and for use and possession of a firearm in furtherance of that robbery, announced United States Attorney Melinda Haag.
According to the superseding indictment, Mota is alleged to have robbed the Mount Konocti Gas & Mart on January 18, 2013. During the course of that robbery, the defendant shot and killed Forrest Seagrave.
“We take our responsibility to the residents of Lake County, and the entire Northern District of California, seriously,” said U.S. Attorney Melinda Haag. ”Therefore, when the Lake County District Attorney and Sheriff requested federal law enforcement coordination on this investigation, I am quite pleased that we were able to come together and focus the necessary resources on the investigation, and now prosecution, of this senseless violent crime.”
“ATF focuses its efforts on individuals who unlawfully possess or use firearms," said Special Agent in Charge Joseph M Riehl. “We appreciate the collaboration with Lake County Sheriff’s Department and District Attorney's Office, and the U.S. Attorney’s Office to perfect this investigation."
“I wish to compliment all of the Lake County investigators for their dogged, non-stop efforts to bring the investigation into the murder of Forrest Seagrave to a close,” said Lake County Sheriff Francisco Rivero. “I also wish to express my deepest gratitude to the United States Attorney’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives for their uncompromising assistance and resources.”
The grand jury has indicted the defendant for his possession of a separate firearm, an assault weapon, during the timeframe of the robbery. He was prohibited from possessing that weapon by virtue of his prior felony conviction for armed robbery. That felon-in-possession case is pending before U.S. District Court Judge Jon Tigar (case No. 13-cr-93). Motions are scheduled to be heard in that case on September 13, 2013 at 9:30 am.
The maximum statutory penalty for use/possession of a firearm in furtherance of the Hobbs Act robbery, a crime of violence, in violation of Title 18 U.S.C. Section 924(c), is life imprisonment and a fine of $250,000. The maximum statutory penalty for the use of the firearm resulting in murder, in violation of Title 18 U.S.C. Section 924(j), is life imprisonment and a fine of $250,000 unless the Attorney General directs the U.S. Attorney to seek the death penalty, in which case the maximum statutory penalty for the murder is death. The maximum statutory penalty for Hobbs Act robbery, in violation of Title 18 U.S.C. Section 1951(a), is 20 years imprisonment and a fine of $250,000. The maximum statutory penalty for being a felon in possession of a firearm, in violation of Title 18 U.S.C. Section 922(g), is 10 years imprisonment and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Kathryn Haun is the Assistant U.S. Attorney who is prosecuting the case with the assistance of the Lake County District Attorney’s Office and with the assistance of Daniel Charlier-Smith and Kurt Kosek of the U.S. Attorney’s Office. The prosecution is the result of a joint investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Lake County Sheriff’s Office.
Please note, an indictment contains only allegations against an individual and, as with all defendants, Mota must be presumed innocent unless and until proven guilty.
(Mota Superseding Indictment )
Justice Department Releases Findings on the Antelope Valley Stations of the Los Angeles County Sheriff’s DepartmentRead the Press Release
The Justice Department Civil Rights Division and Los Angeles County today announced that they have reached preliminary agreements to make broad changes to policing in the Antelope Valley and to the enforcement of the Housing Choice Voucher Program (commonly known as Section 8). Together with statements of intent outlining these changes, the division today released a letter detailing its findings that Los Angeles County Sheriff’s Department’s (LASD) Lancaster and Palmdale stations, both of which are located in the Antelope Valley, engaged in a pattern or practice of stops, searches, and seizures and excessive force in violation of the Constitution and federal law. In addition, the Justice Department found a pattern or practice of discrimination against African Americans in its enforcement of the Housing Choice Voucher Program in violation of the Fair Housing Act. The investigation, launched on Aug. 19, 2011, was brought under to the Violent Crime Control and Law Enforcement Act of 1994, Title VI of the Civil Rights Act of 1964, and the federal Fair Housing Act.
The findings announced today are based on a comprehensive investigation of LASD’s Antelope Valley stations. This investigation included an in-depth review of documents and data provided by LASD and the Housing Authority of the County of Los Angeles (HACoLA), as well as extensive community engagement. The division reviewed tens of thousands of pages of documents, including written policies and procedures, training materials, arrest reports and civilian complaints. The division also conducted interviews of Antelope Valley deputies and unit commanders, local government officials and hundreds of community members. The investigation also included statistical analyses of the Antelope Valley stations’ search and seizure data of pedestrian and vehicle contacts for the entire calendar year of 2011. Sheriff Leroy Baca and HACoLA Executive Director Sean Rogan were cooperative throughout the investigation and immediately began working with the Justice Department to negotiate a remedy to the problems revealed by the investigation.
The division’s investigation into the Antelope Valley stations findings include:
· African Americans, and to a lesser extent Latinos, are more likely to be stopped and/or searched than whites, even when controlling for factors other than race, such as crime rates;
· The widespread use of unlawful backseat detentions violating the Fourth Amendment and LASD policy;
· A pattern of unreasonable force, including a pattern of the use of force against handcuffed individuals;
· A pattern of intimidation and harassment of African-American housing choice voucher holders by LASD deputies, often in conjunction with HACoLA investigators.
· Inadequate implementation of accountability measures to intervene on unconstitutional conduct has allowed these problems to occur.
“We are encouraged by the response of Los Angeles County to our findings. While our investigation showed significant problems in LASD’s Antelope Valley stations, we are confident that we will be able to reach an agreement that will provide meaningful and sustainable reform,” said Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division. “We look forward to continuing our positive partnership with the Los Angeles Sheriff’s Department and HACoLA and believe this work will help restore the community’s confidence in fair, equitable, and effective law enforcement.”
The proposed changes set out in the statement of intent include:
· Revision of LASD’s policies, directives, training, and practices so that stops, searches, and seizures by Antelope Valley deputies are consistently conducted in accordance with the law.
· A commitment to further strengthening and uniformly implementing protocols regarding HACoLA’s investigation of housing choice voucher holders’ compliance with program rules, including LASD deputy participation in those investigations.
· Provision of training that will focus on how bias may occur in law enforcement activity, and on the effects of bias on subjects of law enforcement activity. Training will also educate LASD and HACoLA personnel on federal and constitutional obligations, including the requirements of the Fair Housing Act.
· Revision of LASD’s use of force policies, training curricula, and any relevant directives, bulletins, or defensive tactics manuals to provide clear guidance about the reasonable use of force.
· Continued and increased positive community engagement by LASD in the Antelope Valley, including participating in local community meetings, making itself available for community feedback, developing the Community Advisory Committees (CAC), and working with the community on the development of diversion programs.
In addition to its investigation of LASD, the Civil Rights Division conducted an investigation under the Fair Housing Act of the HACoLA, and the cities of Palmdale and Lancaster, to determine whether there has been a systematic effort by these entities to discriminate against African Americans. As a result of the Department's findings, the Assistant Attorney General for Civil Rights has authorized the filing of a complaint in federal district court against the County of Los Angeles, HACoLA, LASD, and the Cities of Lancaster and Palmdale for alleged violations of federal law. Through the ongoing negotiations, all of the parties seek to avoid contested litigation and resolve the matter in a comprehensive agreement to be entered as an order of the court.
The findings letter will be available on the Civil Rights Division’s Web site at www.justice.gov/crt. The division welcomes comments or concerns via email at [email protected]
Jersey City Contractor Pleads Guilty to Bribing A VA OfficialRead the Press Release
NEWARK, N.J. – A Jersey City, N.J. contractor admitted today that he bribed a Department of Veterans Affairs (VA) official so that two companies with which he was affiliated could obtain favorable treatment from the VA , U.S. Attorney Paul Fishman announced.
Hitesh Desai, 42, of Jersey City, pleaded guilty before U.S. District Judge Mary L. Cooper to an information charging him with one count of bribing a federal public official by promising to make $5,000 in corrupt payments in exchange for official action.According to documents filed in this case and statements made in court:
Desai was a contractor who worked on various construction projects for the VA. In 2012, Desai became affiliated with two businesses that were applying to be placed on a VA list known as the Multiple Award Task Order Contract (MATOC). Certain lucrative VA construction projects were available only to contractors who were placed on the MATOC list. Between October 2012 and February 2013, Desai offered and promised to make a $5,000 bribe payment to an official who worked at the VA, who Desai understood to be responsible for serving on a committee that would determine which contractors were placed on the MATOC list, in exchange for the official’s official assistance in placing the two businesses with which Desai was affiliated on the list. On Oct. 18, 2012, and Dec. 6, 2012, Desai made two cash payments, totaling $1,000, to the aforementioned official in exchange for the official’s official assistance in placing the two businesses with which he was affiliated on the VA’s MATOC list.
The count to which Desai pleaded guilty carries a maximum potential penalty of 15 years in prison, a $250,000 fine, twice the aggregate loss to victims or gain to the defendant, or three times the amount of the bribe payments. Sentencing is scheduled for Oct. 2, 2013.
U.S. Attorney Fishman credited special agents of the Department of Veterans Affairs, Office of Inspector General, under the direction of Special Agent in Charge Jeffrey Hughes, and special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford for the investigation in this case.
The government is represented by Assistant U.S. Attorney Vikas Khanna of the U.S. Attorney’s Office Special Prosecutions Division in Newark.13-270
Defense counsel: Theodore Margolis, Bridgewater, N.J.
Desai Information
Jersey City Contractor Pleads Guilty to Bribing A VA OfficialRead the Press Release
NEWARK, N.J. – A Jersey City, N.J. contractor admitted today that he bribed a Department of Veterans Affairs (VA) official so that two companies with which he was affiliated could obtain favorable treatment from the VA , U.S. Attorney Paul Fishman announced.
Hitesh Desai, 42, of Jersey City, pleaded guilty before U.S. District Judge Mary L. Cooper to an information charging him with one count of bribing a federal public official by promising to make $5,000 in corrupt payments in exchange for official action.According to documents filed in this case and statements made in court:
Desai was a contractor who worked on various construction projects for the VA. In 2012, Desai became affiliated with two businesses that were applying to be placed on a VA list known as the Multiple Award Task Order Contract (MATOC). Certain lucrative VA construction projects were available only to contractors who were placed on the MATOC list. Between October 2012 and February 2013, Desai offered and promised to make a $5,000 bribe payment to an official who worked at the VA, who Desai understood to be responsible for serving on a committee that would determine which contractors were placed on the MATOC list, in exchange for the official’s official assistance in placing the two businesses with which Desai was affiliated on the list. On Oct. 18, 2012, and Dec. 6, 2012, Desai made two cash payments, totaling $1,000, to the aforementioned official in exchange for the official’s official assistance in placing the two businesses with which he was affiliated on the VA’s MATOC list.
The count to which Desai pleaded guilty carries a maximum potential penalty of 15 years in prison, a $250,000 fine, twice the aggregate loss to victims or gain to the defendant, or three times the amount of the bribe payments. Sentencing is scheduled for Oct. 2, 2013.
U.S. Attorney Fishman credited special agents of the Department of Veterans Affairs, Office of Inspector General, under the direction of Special Agent in Charge Jeffrey Hughes, and special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford for the investigation in this case.
The government is represented by Assistant U.S. Attorney Vikas Khanna of the U.S. Attorney’s Office Special Prosecutions Division in Newark.13-270
Defense counsel: Theodore Margolis, Bridgewater, N.J.
Desai Information
Hamburg Woman Pleads Guilty to Conspiracy to Defraud the GovernmentRead the Press Release
BUFFALO, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Sheri L. Becirovic, 47, of Hamburg, N.Y., pleaded guilty before U.S. Magistrate Court Judge H. Kenneth Schroeder, Jr., to conspiracy to defraud the government. The charge carries a maximum penalty of 10 years in prison, a fine of $250,000 or both.
Assistant U.S. Attorney Trini E. Ross, who is handling the case, stated that the defendant obtained the social security numbers of seven family members and friends. Becirovic provided those numbers, in addition to her own social security number, to a co-conspirator, Clifton Jackson, who used them to file fraudulent tax returns for the tax year 2011. The conspiracy resulted in a loss to the Internal Revenue Service of $60,961.
The plea is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service - Criminal Investigation Division, under the direction of Special Agent- in-Charge Toni M. Weirauch, and the United States Postal Inspection Service under the direction of Kevin Niland, Inspector in Charge, Boston Division.
A sentencing date has not been scheduled.Gun Arrest from FBI Wiretap Prevents Gang ShootingRead the Press Release
BOSTON – Two Brockton men were indicted yesterday, charged with a federal firearms violation. The indictment resulted from federal, state and local authorities’ efforts to reduce violence and drug trafficking in the Brockton area by identifying and investigating individuals involved in these criminal activities.
Renaldo Wilson, a/k/a Nardo, 30, is charged with being a felon in possession of a firearm and ammunition and Aaron Heywood, a/k/a Young, 30, is charged with being a felon in possession of a firearm and ammunition. Wilson and Heywood were arrested yesterday morning in state court where they faced related charges. If convicted, Wilson and Heywood each face a maximum penalty of 20 years in prison, followed by three years of supervised release and a $250,000 fine.
A court filing revealed that Wilson and Heywood, both convicted felons, were in possession of a firearm. Federally authorized wiretap evidence demonstrated that an ongoing “beef” (a term for a gang war) between Wilson and Heywood, members of the “Eastside” gang, and rival members of the “Exchange Street” gang, was about to escalate into a shooting.
Through the recorded telephone calls, Wilson was heard in a confrontation with a rival gang leader. They discussed that the gang leader “lost two [men]” and confirmed that the two gangs were in a “beef.” He informed Wilson that the fight stemmed from the unsolved murder of his two gang associates in the summer of 2011. Following this conversation, Wilson called his gang associates and warned them of the “beef.” Wilson spoke about the beef and then asked an associate about obtaining bullets for a gun. Wilson already possessed the gun and stated that he needed more bullets because of the beef stating, “trust me, I’m gonna need ‘em.”
Law enforcement intervened and Wilson and Heywood were arrested during a motor vehicle stop, in which the firearm was seized. As detailed in the court filing, Wilson and Heywood both have extensive criminal histories.
“These arrests represent the ongoing commitment of local, state, and federal authorities to work together to reduce street violence in Brockton,” said United States Attorney Carmen M. Ortiz. “The recent increase in violence will not be tolerated, and this investigation demonstrates that the combined efforts of law enforcement to reduce this violence are paying off. I commend all of the investigators and prosecutors whose persistence and hard work resulted in the removal of these two dangerous individuals from the streets. Every single day that violent gang members are off the streets, members of the community are safer.”U.S. Attorney Ortiz; Richard DesLauriers, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Plymouth District Attorney Timothy J. Cruz; Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police; and Brockton Police Chief Emanuel Gomes, made the announcement today. This case is being prosecuted by Glenn A. MacKinlay in Ortiz’s Organized Crime Strike Force Unit.
The details contained in the Indictment are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Four Defendants Plead Guilty in Staged Automobile Accident SchemeRead the Press Release
92 defendants have been charged to date in Operation Sledgehammer I-VI
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Michael J. DePalma, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Jeff Atwater, Florida Chief Financial Officer, and Dave Aronberg, State Attorney, Office of the State Attorney for Palm Beach County, announced that defendants Luis Ivan Hernandez, 40, and Maria Testa Baceiro, a/k/a “Maria Testa,” 29, both of Miami, and Olinda Rodriguez, 39, of West Palm Beach, pled guilty today for their participation in a staged automobile accident scheme. Defendant Iris Roca, 41, of Davie, pled guilty on June 26, 2013 for her role in the scheme. Sentencing is set for September 30, 2013 before Judge Marra starting at 9:00 a.m.
Clinic owners Hernandez and Baceiro each pled guilty to one count of conspiracy to commit mail fraud, in violation of Title 18, United States Code, Section 1349; 27 counts of mail fraud, in violation of Title 18, United States Code, Section 1341; and one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). Hernandez also pled guilty to 21 counts of money laundering, in violation of Title 18, United States Code, Section 1956(a)(1). Baceiro pled guilty to 20 counts of money laundering, in violation of Title 18, United States Code, Section 1956(a)(1).
Licensed massage therapists Rodriguez and Roca each pled guilty to one count of conspiracy to commit mail fraud, in violation of Title 18, United States Code, Section 1349. These defendants were charged in separate Informations for their participation in the staged accident fraud schemes.
The defendants face the following possible maximum statutory sentences: 20 years in prison for each count of conspiracy to commit mail fraud, substantive mail fraud, conspiracy to commit money laundering, and substantive money laundering. Restitution to the victims of the offenses is mandatory.
According to court documents, between approximately October 2006 and December 2012, the defendants staged automobile accidents and thereafter caused the submission of false insurance claims through chiropractic clinics they controlled. To execute the scheme, the true owners of the chiropractic clinics recruited individuals, who had the medical or chiropractic licenses required by the state to open a clinic, to act as “nominee owners” of the clinics. The defendants also recruited individuals, whom they referred to as “Perro” and “Perra,” to participate in the accidents, and others to help the clinics launder the insurance proceeds. The defendants also hired complicit chiropractors and therapists who prescribed and billed for unnecessary treatments and/or for services that had not been rendered. Thereafter, complicit clinic employees prepared and submitted claims to the automobile insurance companies for payment for these unnecessary or non-rendered services. Twenty-one clinics participated in this scheme.
Starting with Operation Sledgehammer I in June 2011 and including the defendants charged in Operation Sledgehammer VI, 92 defendants have been charged for their participation in this automobile insurance fraud scheme. Of those 92 defendants, 56 have been charged federally by the U.S. Attorney’s Office, resulting in court-ordered restitution of more than $5 million to the defrauded insurance companies. Thirty-six defendants have been charged by the Palm Beach County State Attorney’s Office.
Mr. Ferrer commended the efforts of the FBI, IRS-CI, the Florida Department of Insurance Fraud, the Palm Beach County State Attorney’s Office, and the Greater Palm Beach County Health Care Fraud Task Force for their outstanding work in this case. Mr. Ferrer also recognized the National Insurance Crime Bureau (NICB) for its collaboration and assistance in this investigation. The federal cases are being prosecuted by Assistant U.S. Attorney A. Marie Villafaña and the state cases are being prosecuted by the Palm Beach County State Attorney’s Office.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Swiss Banker Pleads Guilty to Failure to Report Foreign Bank AccountRead the Press Release
Assistant Attorney General for the Tax Division Kathryn Keneally and U.S. Attorney Melinda Haag for the Northern District of California announced that Pius Kampfen of Mill Valley, Calif., pleaded guilty today to an information charging him with willful failure to file the required reports of foreign bank accounts (FBAR) for a Swiss bank account he controlled.
According to the plea agreement, Kampfen was employed as an international banker for approximately 40 years until he retired in 2001. He retired as senior vice president and the senior west coast representative San Francisco of Julius Baer Bank. As an international banker, he advised Julius Baer clients interested in international diversification about the bank’s investment management services.
Beginning in 2000, Kampfen was the beneficial owner of a number of bank accounts in Switzerland held in the name Albia Investments. Between 2000 and June 2012, he maintained accounts in the name of Albia at UBS AG, Pictet & Cie, ABN-AMRO, Bank Vontobel and Baumann & Cie. For the years 2007, 2008 and 2009, Kampfen failed to report any of the Albia accounts on his income tax returns or file FBARs for the accounts despite the fact that he knew he was required to do so.
As part of his plea agreement, Kampfen has agreed to pay an FBAR penalty of $1,465,393 before he is sentenced.
U.S. citizens and residents who have an interest in, or signature authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such account on Schedule B, Part III, of their individual income tax returns. Additionally, U.S. citizens and residents must file an FBAR with the U.S. Treasury disclosing any financial account in a foreign country with assets in excess of $10,000 in which they have a financial interest, or over which they have signature or other authority.
Sentencing has been scheduled for Oct. 4, 2013. Kampfen faces a maximum penalty of five years in prison and a fine of up to $250,000.
The case was investigated by IRS – Criminal Investigation, and is being prosecuted by Trial Attorney Katherine Wong of the Justice Department’s Tax Division and Assistant U.S. Attorney Thomas Moore.
Former Officers of American Mortgage Specialists Inc. Sentenced for $28 Million Fraud Against BNC National BankRead the Press Release
Scott N. Powers, the former CEO of Arizona-based mortgage loan originator American Mortgage Specialists Inc. (AMS), and David McMaster, a former officer of AMS, were sentenced today to serve 96 and 188 months in prison, respectively, for their roles in a $28 million scheme to defraud North Dakota-based BNC National Bank (BNC).
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Timothy Q. Purdon of the District of North Dakota; Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP); and Steve A. Linick, Inspector General of the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG) made the announcement.
Powers and McMaster were sentenced by U.S. District Judge Daniel L. Hovland in the District of North Dakota. In addition to their prison terms, Powers and McMaster were each ordered to pay a money judgment to the government of approximately $28,564,470 and also to pay restitution to BNC bank in that same amount.
Powers and McMaster pleaded guilty on Oct. 19, 2012, to conspiracy to commit bank fraud and wire fraud affecting a financial institution.
According to court documents, Powers and McMaster conspired from October 2007 to April 2010 to defraud BNC by making false representations regarding the financial and operational condition of AMS in order to obtain funding from BNC and personal benefits for themselves. Using funds provided by BNC under a participation agreement, AMS made residential real estate mortgage loans to borrowers and then sold the loans to banks and other lenders. As part of their fraud, Powers and McMaster caused AMS to inflate the dollar amount of the sales and to delay sending email notifications to BNC when specific loans were sold, and then used funds from newly sold loans to make payments on the earlier-sold loans. Powers and McMaster also caused false financial information about AMS to be sent to BNC, overstating AMS’s cash-on-hand and disguising delinquent tax payments being made to the Internal Revenue Service as marketing and advertising expenses.
BNC was a national bank with headquarters in Bismarck, N.D., and offices in several states, including Arizona. The bank was a member of the Federal Home Loan Bank of Des Moines, one of 12 regional banks established by Congress to support mortgage lending. BNC’s holding company received approximately $20 million in federal funds from TARP, and the holding company injected approximately $18 million of the TARP funds into BNC.
The fraud resulted in a loss of over $28 million to BNC. As a result of the loss, BNC had to sell off some of its assets and the bank was unable to make its required dividend payments to TARP for nearly two years on approximately $17 million the bank had received from TARP.
Lauretta Horton, the former Director of Accounting for AMS, and David Kaufman, the external auditor for AMS, were previously sentenced for offenses related to the fraud.The investigation was conducted by agents assigned to SIGTARP and FHFA-OIG. The case is being prosecuted by Trial Attorney Robert A. Zink and Senior Litigation Counsel Jack B. Patrick of the Criminal Division’s Fraud Section and by Assistant U.S. Attorney Clare Hochhalter of the District of North Dakota, with the assistance of Trial Attorneys Ann Marie Blaylock and Darrin McCullough of the Criminal Division’s Asset Forfeiture and Money Laundering Section.
This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
Former Officers of American Mortgage Specialists Inc. Sentenced for $28 Million Fraud Against BNC National BankRead the Press Release
WASHINGTON – Scott N. Powers, the former CEO of Arizona-based mortgage loan originator American Mortgage Specialists Inc. (AMS), and David McMaster, a former officer of AMS, were sentenced today to serve 96 and 188 months in prison, respectively, for their roles in a $28 million scheme to defraud North Dakota-based BNC National Bank (BNC).
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Timothy Q. Purdon of the District of North Dakota; Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP); and Steve A. Linick, Inspector General of the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG) made the announcement.
Powers and McMaster were sentenced by U.S. District Judge Daniel L. Hovland in the District of North Dakota. In addition to their prison terms, Powers and McMaster were each ordered to pay a money judgment to the government of approximately $28,564,470 and also to pay restitution to BNC bank in that same amount.
Powers and McMaster pleaded guilty on Oct. 19, 2012, to conspiracy to commit bank fraud and wire fraud affecting a financial institution.
According to court documents, Powers and McMaster conspired from October 2007 to April 2010 to defraud BNC by making false representations regarding the financial and operational condition of AMS in order to obtain funding from BNC and personal benefits for themselves. Using funds provided by BNC under a participation agreement, AMS made residential real estate mortgage loans to borrowers and then sold the loans to banks and other lenders. As part of their fraud, Powers and McMaster caused AMS to inflate the dollar amount of the sales and to delay sending email notifications to BNC when specific loans were sold, and then used funds from newly sold loans to make payments on the earlier-sold loans. Powers and McMaster also caused false financial information about AMS to be sent to BNC, overstating AMS’s cash-on-hand and disguising delinquent tax payments being made to the Internal Revenue Service as marketing and advertising expenses.
BNC was a national bank with headquarters in Bismarck, N.D., and offices in several states, including Arizona. The bank was a member of the Federal Home Loan Bank of Des Moines, one of 12 regional banks established by Congress to support mortgage lending. BNC’s holding company received approximately $20 million in federal funds from TARP, and the holding company injected approximately $18 million of the TARP funds into BNC.
The fraud resulted in a loss of over $28 million to BNC. As a result of the loss, BNC had to sell off some of its assets and the bank was unable to make its required dividend payments to TARP for nearly two years on approximately $17 million the bank had received from TARP.
Lauretta Horton, the former Director of Accounting for AMS, and David Kaufman, the external auditor for AMS, were previously sentenced for offenses related to the fraud.The investigation was conducted by agents assigned to SIGTARP and FHFA-OIG. The case is being prosecuted by Trial Attorney Robert A. Zink and Senior Litigation Counsel Jack B. Patrick of the Criminal Division’s Fraud Section and by Assistant U.S. Attorney Clare Hochhalter of the District of North Dakota, with the assistance of Trial Attorneys Ann Marie Blaylock and Darrin McCullough of the Criminal Division’s Asset Forfeiture and Money Laundering Section.
This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants.
Former Mayor of Melissa, Texas Sentenced for Bribery SchemeRead the Press Release
Department of Justice
Office of Public AffairsSHERMAN, Texas – Two Collin County, Texas men, including the former mayor of the city of Melissa, have been sentenced to federal prison in connection with a bribery scheme in the Eastern District of Texas, announced U.S. Attorney John M. Bales.
David E. Dorman, 66, of Melissa, Texas, pleaded guilty on Jan. 7, 2013 to mail fraud and was sentenced to 33 months in federal prison and three years of supervised release today by U.S. District Judge Marcia Crone. Dorman was also ordered to submit to forfeiture of $30,000.John Christie, 65, of Frisco, Texas, pleaded guilty on Jan. 4, 2013 to misprision of a felony and was sentenced to six months in federal prison to be followed by one year of supervised release today by Judge Crone. Christie was also ordered to relinquish his real estate license for the duration of his sentence and term of supervised release and was fined $5,000.
According to information presented in court, in 2007, Dorman, then mayor of the city of Melissa, solicited a $70,000 bribe from Christie in exchange for arranging for the city of Melissa to annex a portion of land from the city of McKinney, Texas, in order for Christie to develop and sell the land to potential customers. Based on a letter from Dorman, the cities of Melissa and McKinney approved the annexation and in exchange, Christie made one $10,000 cash payment and two $10,000 payments by check to Dorman. The men were initially named in an indictment returned by a federal grand jury on Sep. 12, 2012.
“Public officials are held to the highest standard of conduct and owe their communities honest, faithful service,” said U.S. Attorney Bales. “David Dorman breached the trust that he held, and we hold him, as we would hold any corrupt public official, fully accountable for his crime.”
This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Shamoil T. Shipchandler.
Former Manager of Local Title Company Indicted on Federal Fraud ChargesRead the Press Release
St. Louis, MO - ELIZABETH GLOSEMEYER of St. Louis County, was indicted on two counts of wire fraud.
According to the indictment, while the manager of Lenders Guarantee Title Company of St. Louis, Glosemeyer raided the company’s escrow account to fund operations. The escrow account consisted of clients’ money and was to be used only for clients’ real estate transactions. The indictment further alleges that Glosemeyer doctored financial records to cover up her raiding of the escrow account from Lenders’ underwriters. In the summer of 2012, an audit uncovered Glosemeyer’s scheme and Lenders went out of business soon thereafter. Due to the deficit in the escrow account Glosemeyer created, at least one transaction in excess of $200,000 had to be closed with the underwriters’ funds.Each count of wire fraud carries a maximum term of imprisonment of 20 years, a $250,000 fine or both. Restitution to financially aggrieved parties is also mandatory. 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 U.S. Postal Inspection Service and the Federal Bureau of Investigation. Assistant United States Attorney Tom Albus 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 HPD Officers Convicted for Conspiring to Protect CocaineRead the Press Release
HOUSTON – Two former officers with the Houston Police Department (HPD) have been convicted of conspiracy to violate the Hobbs Act, also known as extortion under color of official right, United States Attorney Kenneth Magidson announced today. Emerson Canizales, 27, of Kingwood, and Michael Miceli, 27, of Humble, were arrested in January 2013 and pleaded guilty just a short time ago before U.S. District Judge Gray H. Miller.
Canizales and Miceli were peace officers with HPD at the time of the offense. They have now admitted they accepted money for providing protection for a vehicle they believed contained cocaine.
A joint agency task force learned the officers were involved in criminal conduct which may involve narcotics and illegal bribes. As part of the investigation, a confidential source approached Canizales and Miceli and asked if they would assist with the protection of a vehicle that was coming through Houston. They agreed.
On Dec. 26, 2012, Miceli and Canizales arrive in a marked patrol car in their official uniforms and followed the source, who was driving a tow truck pulling the vehicle containing the cocaine. The officers provided protection and followed the “load vehicle” from a Target Parking lot to a Sam’s Club parking lot in Houston.
Canizales admitted as part of his plea that he was given $1000 while Miceli was waiting in the patrol car. Miceli acknowledged he received $500 from Canizales after the escort. Both men have also admitted they believed the vehicle contained narcotics though they did not know the type or quantity.
Judge Miller has set sentencing for Sept. 27, 2013, at which time both men face up to 20 years in prison and a possible $250,000 fine. They were permitted to remain on bond pending that hearing.
The operation was an effort conducted by Houston Police Department - Internal Affairs, Drug Enforcement Administration, and High Intensity Drug Trafficking Area Program (HIDTA) Major Drug Squad. The case is being prosecuted by Assistant United States Attorney James McAlister.
Former Governor of Mexican State Sentenced in Manhattan Federal Court to 131 Months in Prison for Money Laundering in Connection with Narcotics BribesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that MARIO VILLANUEVA MADRID, the former governor of the Mexican state of Quintana Roo, was sentenced today in Manhattan federal court. VILLANUEVA MADRID received a sentence of 131 months in prison for conspiring to launder millions of dollars in narcotics bribe payments that he received from the Juarez Cartel – one of Mexico’s most notorious and violent cocaine cartels – through accounts at banks in the United States and other countries. VILLANUEVA MADRID, 65, was extradited from Mexico in May 2010. He pled guilty on August 2, 2012, before U.S. District Judge Victor Marrero, who also imposed today’s sentence. Judge Marrero stated that he viewed the appropriate sentence to be 204 months’ imprisonment, less 73 months for the time VILLANUEVA MADRID spent in Mexican custody on related Mexican charges, and he therefore imposed a final sentence of 131 months’ imprisonment in the United States.
Manhattan U.S. Attorney Preet Bharara stated: “Mario Villanueva Madrid was entrusted to serve the public in Mexico, but instead, in return for millions of dollars in bribes, he provided safe passage to a brutal drug cartel allowing it to move massive amounts of cocaine through the state he governed. With his sentence today, Villanueva Madrid completes his descent from elected government official to corrupted official to incarcerated felon. This Office and our law enforcement partners will not relent in our efforts to prosecute and punish corrupt public officials who violate U.S. law, wherever they operate.”
According to Indictments previously returned in this case, and statements made during court proceedings:
In the mid- to late-1990s, the Juarez Cartel transported over 200 tons of cocaine into the United States across the Southwest U.S. border. In 1994, the Cartel established operations in the eastern Mexican state of Quintana Roo, where the resort city of Cancun is located.
VILLANUEVA MADRID, who had previously served as mayor of Cancun, was elected governor of Quintana Roo in April 1993. In 1994, he entered into an agreement with the Juarez Cartel that would ensure its cocaine shipments traveled safely through Quintana Roo without interference from law enforcement. Under the agreement, VILLANUEVA MADRID was paid between $400,000 and $500,000 for each shipment of cocaine that the Cartel transported through Quintana Roo.
From 1994 through 1999, the Juarez Cartel paid VILLANUEVA MADRID millions of dollars in narcotics proceeds. By late 1995, in an effort to hide the illicit funds, he began transferring them to bank and brokerage accounts in the United States, Switzerland, the Bahamas, Panama, and Mexico, many of which were held in the names of British Virgin Islands shell corporations. In April 1999, shortly before his term as Governor was to expire and while under investigation by Mexican authorities, VILLANUEVA MADRID fled. He remained a fugitive for over two years.
In connection with his flight, VILLANUEVA MADRID liquidated the millions of dollars in narcotics proceeds he had deposited at Lehman Brothers Inc. (“Lehman”), through a series of wire transfers totaling over $11 million. These transfers were made through an account at the Mexican bank Banamex that had been secretly opened for him in the name of “Lehman Brothers Private Client Services.” A large portion of the illicit proceeds – over $7 million – were then deposited into an account at Lehman that a banker had opened in the names of a non-existent Mexican family.
In May 2001, VILLANUEVA MADRID was arrested and subsequently convicted in Mexico on organized crime and corruption offenses. All of his illicit funds at Lehman and in other U.S. accounts, totaling over $17 million, were seized and later forfeited by U.S. authorities.
In addition to the prison term, Judge Marrero ordered VILLANUEVA MADRID to pay a $100 special assessment fee.
Mr. Bharara praised the extraordinary investigative efforts of the U.S. Drug Enforcement Administration’s (“DEA”) New York Organized Crime Drug Enforcement Strike Force (“the Strike Force”) – which is comprised of agents and officers of the DEA, the New York City Police Department, Immigration and Customs Enforcement – Homeland Security Investigations (HSI), the New York State Police, the U. S. Internal Revenue Service Criminal Investigation Division, the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Secret Service, and the U.S. Marshals Service – as well as the DEA’s Mexico City Country Office and Merida, Mexico, Resident Office, which together led the investigation. The Strike Force is partially funded by the New York/New Jersey High Intensity Drug Trafficking Area, which is a federally funded crime fighting initiative. Mr. Bharara also recognized the DEA’s Offices in Houston and Pittsburgh, as well as the United States Attorney’s Office in Houston, for their invaluable assistance in the investigation. Mr. Bharara also thanked the U.S. Marshals Service and the Department of Justice's Office of International Affairs for their assistance in this matter.
This case is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant United States Attorneys Glen Kopp and Anna Skotko are in charge of the prosecution.
Former Davenport Man Sentenced for Possession of Firearm as FelonRead the Press Release
DAVENPORT, IA - On June 27, 2013, Brett Lee Roelandt, age 22, from Davenport, Iowa, was sentenced by United States District Court Chief Judge James E. Gritzner to 30 months imprisonment, after pleading guilty to felon in possession of a firearm, announced United States Attorney Nicholas A. Klinefeldt. Roelandt was also ordered to serve three years of supervised release and pay $100 towards the Crime Victims Fund.
On March 30, 2010, Roelandt was with a group of individuals that got into an argument with Aki Ross in the area of 12th and Pershing Avenue in Davenport. At that time, Roelandt was in possession of a Smith & Wesson, Model 411, .40 caliber semi-automatic handgun. As the group walked away, Aki Ross followed with a handgun. Brett Roelandt and other subjects observed Ross approaching with the handgun and took cover behind a van parked on the east side of Pershing Avenue. Roelandt discharged a shot from his handgun, and Ross fired several shots in the general direction of Roelandt. At approximately the same time, Joevonte Howard, age 18, was attempting to cross the street between Roelandt and Ross. Howard was struck by a bullet from Ross’ handgun and later died. Roelandt left the shooting scene with the handgun. As part of the subsequent police investigation a .40 caliber casing was found a short distance from the van where Roelandt took cover. Roelandt was prohibited from possession of a firearm as the result of a 2008 felony conviction.
Aki Ross was convicted on June 29, 2011, in Iowa District Court for Scott County of the crimes of voluntary manslaughter and intimidation with a weapon, and sentenced on July 22, 2011, to six consecutive 10-year terms of imprisonment.
This case was investigated by the Bureau of Alcohol, Tobacco and Firearms, the Davenport Police Department and the Scott County Attorney’s Office, the case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Former Davenport Man Sentenced for Possession of Child PornographyRead the Press Release
DAVENPORT, IA - On June 27, 2013, Anthony Boyd Conklin, age 36, formerly from Davenport, Iowa, was sentenced by United States District Court Chief Judge James E. Gritzner to 240 months of imprisonment, after pleading guilty to possession of child pornography, announced United States Attorney Nicholas A. Klinefeldt. Conklin was also ordered to serve ten years of supervised release and pay $100 towards the Crime Victims Fund.
On April 12, 2011, as the result of an online undercover operation, state and federal officers conducted a search of Conklin’s Davenport residence. Several computers and related equipment were seized along with numerous articles of children’s clothing and underwear. As a result of a forensic examination of this computer, investigators determined that from approximately July 2002 to April 2011, Conklin used a computer to access the Internet to search for and download at least 8,000 images and approximately 688 videos of minors engaged in sexually explicit conduct. In addition to possession of child pornography, Conklin admitted that he had sent images of himself via a web-camera, engaged in sexually explicit conduct, and chatted with minors who sent him web-camera images of themselves engaging in sexually explicit conduct.
This case was investigated by the United States Secret Service, the Davenport, Iowa, Police Department, and the Quad Cities Cyber-Crime Unit. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Former Davenport Man Sentenced for Mailing Threatening CommunicationRead the Press Release
DAVENPORT, IA - On June 27, 2013, Bryan R. Dunn, age 25, formerly from Davenport, Iowa, was sentenced by United States District Court Chief Judge James E. Gritzner to 37 months imprisonment, after pleading guilty to mailing threatening communications, announced United States Attorney Nicholas A. Klinefeldt. Dunn was also ordered to serve three years of supervised release and pay $100 towards the Crime Victims Fund.
On July 7, 2012, Dunn deposited for mailing a letter threatening to injure an Assistant Scott County Attorney.
This case was investigated by the Federal Bureau of Investigations, the United States Marshals Service, the United States Secret Service, and the Scott County Sheriff’s Office. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Fairlawn Man Sentenced to Three Years in Prison, Ordered to Pay $14 MilllionRead the Press Release
A Fairlawn man was sentenced to more than three years in prison and ordered to pay more than $14 million in restitution for his role in a mortgage fraud scheme in Florida and a separate scheme to defraud two elderly investors, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Jason Herceg, 37, previously pleaded to three charges. He admitted to participating in the two schemes and failure to report his income derived from the scheme against the elderly investors.
Herceg and his business partner Andrew Norman conspired with Jack Coppenger in procuring “straw buyers” and submitting false loan documents to banks to purchase Coppenger’s lots in Florida (which had already been inflated in value as part of a land flip) in a mortgage fraud scheme. Coppenger, with assistance from Norman and Herceg, perpetrated a large mortgage fraud scheme involving numerous straw buyers, who essentially sold their good credit score to Coppenger, in order for him to secure loans, through straw buyers’ names, for property in Florida.
Coppenger promised money to the straw buyers if they signed the loan application and paperwork, that he would make any down payment and all the mortgage payments for the straw buyers, and that, once the property was developed, they would receive half the profits from any sale, according to court documents.
Norman and Herceg were mentored by Coppenger in how to recruit and use straw buyers. Norman and Herceg assisted Coppenger by using their brokerage company, Akron-based V.P. Equity, to prepare and submit falsified loan documents to the banks, which fraudulently inflated the income and assets of the straw buyers to qualify them for these loans. Ultimately, Coppenger failed to make the mortgage payments on these loans, resulting in a loss to banks of approximately $13.1 million, according to court documents.
In the second conspiracy scheme, Norman, Herceg, Coppenger and others, conspired to defraud two elderly individuals by selling them a Florida property for $7 million. Moments before the sale, Norman and Herceg, with Coppenger’s help, bought the property, through their partnership, 104 Investments, from the original seller and inflated its value by approximately $2.5 million. They then sold this property to these elderly individuals, who were told they were buying the property from the original seller. These elderly victims were never told of the last minute “flip” and that they were actually buying the land from Norman, Herceg and 104 Investments. Norman, Herceg, and their 104 Investments business partner, Robert Jason Workman, received approximately $2.5 million from this gain, and funneled portions out to themselves and paid $690,000 to Coppenger as a kickback for setting up the fraudulent scheme, which they fraudulently deducted as a business expenses, according to court documents.
Norman also failed to report the income from this fraudulent scheme on his 2006 tax return.
Norman was sentenced to more than three years in prison earlier this month. Coppenger has pleaded guilty and is awaiting sentencing.
The case is being prosecuted by Assistant U.S. Attorneys Christian H. Stickan and Henry F. DeBaggis, following investigation by agents of the Internal Revenue Service – Criminal Investigations and the Federal Bureau of Investigation’s Akron office.
Fairbanks Man sentenced to prison for drug dealingRead the Press Release
Anchorage, Alaska -U.S. Attorney Karen L. Loeffler announced today that a Fairbanks man was sentenced in U.S. District Court in Fairbanks, for conspiracy and aiding the distribution of drugs.
William E. Kaiser, Jr., 52, of Fairbanks, Alaska, was sentenced in Fairbanks on June 21, 2013, by Chief U.S. District Court Judge Ralph R. Beistline, after Kaiser pled guilty to charges that he conspired to distribute marijuana in the Fairbanks area and that he aided others in distributing the drug. Judge Beistline sentenced Kaiser to 40 months in prison. The charges arose from the 2012 seizure of a shipment of $40,000 in cash, which Kaiser had sent to his supplier in Oregon in payment for drugs that the supplier had shipped to Fairbanks.
According to Assistant U.S. Attorney Stephen Cooper, who prosecuted the case, the facts Kaiser admitted to in court showed that he had an ongoing agreement for the Oregon supplier to ship marijuana to Kaiser or his associates in Fairbanks for $2,500 per pound. Kaiser sent payments to the supplier in the form of cash proceeds of the sales. This conspiracy lasted from mid-2011 and until June 2012, and resulted in well over a dozen shipments totaling between 130 and 175 pounds of marijuana.
In 2001, Kaiser had previously been convicted in federal court in Fairbanks of cultivating over 380 marijuana plants and possessing a firearm in furtherance of drug trafficking. He was sentenced to 10 years in prison, and was on supervised release from that sentence when he committed the current offenses. Kaiser now faces additional proceedings for violating his supervised release by committing these offenses.
Ms. Loeffler commends the Drug Enforcement Administration and the Medford, Oregon, Police Department for the investigation of this case.
Executives from Miami-Area Mental Health Care Hospital Convicted for Participating in $70 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – A federal jury today convicted four individuals for their participation in a Medicare fraud scheme involving nearly $70 million in fraudulent billings by Hollywood Pavilion (HP), a mental health care hospital.
Today’s verdict was announced by Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Karen Kallen-Zury, 59, of Lighthouse Point, Fla., and Daisy Miller, 44, of Hollywood, Fla., were each found guilty of one count of conspiracy to commit wire fraud and health care fraud, five substantive counts of wire fraud and two substantive counts of health care fraud. Michele Petrie, 64, of Ft. Lauderdale, Fla., was found guilty of one count of conspiracy to commit wire fraud and health care fraud and three substantive counts of wire fraud. Kallen-Zury, Miller, Petrie and a fourth defendant, Christian Coloma, 49, of Miami Beach, Fla., were also convicted of one count of conspiracy to pay bribes in connection with Medicare, with Kallen-Zury and Coloma also each being convicted on five substantive counts of paying bribes.
“The defendants convicted today participated in a massive scheme that attempted to defraud the United States of approximately $70 million by taking advantage of Medicare beneficiaries,” said Acting Assistant Attorney General Raman. “By paying bribes to a network of patient recruiters and falsifying documents, the defendants created the illusion of providing intensive psychiatric care to qualifying patients, when in reality they provided no care of substance. Today’s verdict illustrates the success of the inter-agency Medicare Fraud Strike Force, which is dedicated to stamping out Medicare fraud.”
The defendants were charged in an indictment returned on Oct. 2, 2012. Evidence at trial demonstrated that the defendants and their co-conspirators caused the submission of false and fraudulent claims to Medicare through HP, a state-licensed psychiatric hospital located in Hollywood that purportedly provided, among other things, inpatient psychiatric care and intensive outpatient psychiatric care. The defendants paid illegal bribes and kickbacks to patient brokers in order to obtain Medicare beneficiaries as patients at HP who did not qualify for psychiatric treatment. The defendants then submitted claims to Medicare for those patients who were procured through bribes and kickbacks.
Karen Kallen-Zury, the CEO and registered agent of HP, attempted to conceal the payment of bribes and kickbacks by creating false documents to make it appear as if legitimate services were being rendered.
Evidence at trial established that Miller, the clinical director of HP’s inpatient facility, and Petrie, the head of HP’s intensive outpatient program, facilitated the payment of bribes to patient recruiters and oversaw the fraudulent admissions and treatment of unqualified patients.
Trial evidence also demonstrated that Coloma, the director of physical therapy for an entity associated with HP, facilitated the payment of bribes and kickbacks, and he supervised the creation of false documents to conceal the bribery scheme.
From at least 2003 through at least August 2012, HP billed Medicare nearly $70 million for services that were not properly rendered, for patients that did not qualify for the services being billed and for claims for patients who were procured through bribes and kickbacks.
The criminal case is being prosecuted by Trial Attorneys Robert A. Zink, Andrew H. Warren and Anne McNamara of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion. In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Eight-year Sentence for Former Columbus Police Officer Guilty of Sexual Coercion of MinorsRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS –Todd L. Smith, 50, of Columbus was sentenced in U.S. District Court today to eight years of imprisonment, consisting of seven years in federal prison followed by one year on house arrest, for having illicit sexual relationships with students at the school where he was assigned as a resource officer for the Columbus Division of Police.
Carter M. Stewart, United States Attorney for the Southern District of Ohio and Kevin R. Cornelius, Special Agent in Charge, Federal Bureau of Investigation (FBI) announced the sentence imposed today by U.S. District Judge Algenon L. Marbley.
The FBI began investigating Smith in July 2012 and found that Smith had engaged in a “sexting” relationship with a 14-year old female student at the school. He told the student that he had a sex addiction and that she could help him by having sex with him. Between July 24, 2012 and the morning hours of July 25, 2012, Smith exchanged approximately 113 text messages with an undercover FBI agent posing as the victim.
“The juvenile told her parents about the relationship, and later, the juvenile expressed concerns to the FBI about what the police officer may do to her family as a result of the juvenile coming forward,” Assistant U.S. Attorneys Doug Squires and Michael Hunter wrote in a document filed with the court prior to sentencing.
On July 27, 2012, the FBI became aware of another 15-year old victim who had been coerced through similar text messages into having a sexual relationship with Smith. The FBI found that this relationship began in early 2012 and that they exchanged more than 6,000 text messages during the course of the relationship.
FBI agents arrested Smith on July 26, 2012 and he has been in custody since his arrest. Smith pleaded guilty on January 17, 2013 to one count of coercion and enticement of minors for sexual activity.
Smith must serve five years on supervised release following his prison term. He was also ordered to register for life as a sex offender with law enforcement agencies wherever he lives, works or is a student.
Stewart commended the FBI agents conducting the investigation, and Assistant U.S. Attorneys Doug Squires and Michael Hunter, who represented the United States in the case.Eagle Butte Man Sentenced for Assaulting A MinorRead the Press Release
United States Attorney Brendan V. Johnson announced that an Eagle Butte, South Dakota man was convicted of Assault of a Minor and was sentenced on June 27, 2013 by U.S. Magistrate Judge Mark A. Moreno.
David Roberts, Jr., age 30, was sentenced to 1 year of probation, a $1,000 fine, and a $25 special assessment to the Federal Crime Victims Fund.
Roberts was indicted by a federal grand jury on February 13, 2013 and pled guilty to the charge of Assault of a Minor on April 24, 2013.
The conviction arose from a July 2012 incident in Eagle Butte, when Roberts Jr. became upset at the infant’s behavior and engaged in an open-handed slap to his face. The assault left a large handprint bruise on the baby's cheek.
The investigation was conducted by the Cheyenne River Sioux Tribe Law Enforcement Division. The case was prosecuted by Assistant U.S. Attorney Mikal Hanson.
Duluth Felon Indicted for Carjacking, Possessing Nine-millimeter Pistol and MethamphetamineRead the Press Release
MINNEAPOLIS—A federal indictment unsealed earlier this week charges a 34-year-old felon from Duluth with carjacking and possessing a nine-millimeter pistol as well as methamphetamine. The indictment, which was filed on June 18, 2013, charges Elfred William Petruk with one count of carjacking, one count of conspiracy to possess methamphetamine, one count of being a felon in possession of a firearm, and one count of possession with intent to distribute methamphetamine. The indictment was unsealed following Petruk’s initial appearance in federal court on June 25, 2013.
The indictment alleges that on June 18, 2012, Petruk took a 1989 GMC Sierra pickup truck by force. It also alleges that from the autumn of 2012 through March 27, 2013, Petruk conspired with others to possess methamphetamine, and that on March 27, 2013, he specifically possessed with intent to distribute five or more grams of methamphetamine.
Furthermore, because he is a felon, Petruk is prohibited under federal law from possessing a firearm at any time. The indictment alleges, however, that on December 4, 2012, Petruk possessed a nine-millimeter, semi-automatic pistol. His previous convictions in St. Louis County include second-degree burglary (1995), possession of a firearm by a felon (1998), possession of methamphetamine (1999), and fifth-degree assault (2002). In addition, Petruk was convicted in federal court in the District of Minnesota with possession with intent to distribute methamphetamine (2004). Since those convictions constituted crimes of violence or serious drug crimes, Petruk is now subject to the federal Armed Career Criminal Act. That act mandates a minimum of 15 years in federal prison for anyone subsequently convicted in federal court for being a felon in possession of a firearm or ammunition. Any sentence would be determined by a federal district court judge if Petruk is convicted or pleads guilty to the charges now filed against him.
If convicted, Petruk also faces a potential maximum penalty of 15 years in prison for carjacking, and 40 years on each of the two remaining counts.
This case is the result of an investigation by the Duluth Police Department and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant U.S. Attorney Thomas M. Hollenhorst.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.
Drug Dealer Sentenced to Federal PrisonRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced the sentencing of Christopher J. Daniels, 30, a resident of Colquitt, Georgia, on June 27, 2013 by the Honorable W. Louis Sands, United States District Judge for the Middle District of Georgia. Judge Sands sentenced Mr. Daniels to serve eighty-seven (87) months confinement in the Bureau of Prisons following his plea of guilty on March 25, 2013, to Possession with Intent to Distribute Cocaine and Possession of a Firearm in Furtherance of Drug Trafficking. There is no parole in the federal system.
During a traffic stop for speeding, a drug detection canine on the scene alerted to the presence of illegal narcotics in the vehicle. Upon searching Mr. Daniels' vehicle, a quantity of cocaine and a Smith and Wesson 9mm handgun was found. Mr. Daniel admitted that both the cocaine and the handgun belonged to him. He stated that he needed the gun to protect his drugs while traveling.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant United States Attorney Leah E. McEwen for the Government.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
Drug Dealer Sentenced to Federal PrisonRead the Press Release
Michael J. Moore, United States Attorney for the Middle District of Georgia, announced the sentencing of Johnnie Kenon, 39, of Quincy, Florida, on June 27,2013, before the Honorable W. Louis Sands, United States District Judge for the Middle District of Georgia.
Judge Sands sentenced Mr. Kenon to serve two hundred ninety-four (294) months confinement in the Bureau of Prisons following his plea of guilty on March 19, 2013, in the Albany Division of the Middle District of Georgia, to Conspiracy to Possess with Intent to Distribute more than five (5) kilograms of cocaine.
Court records revealed that Mr. Kenon telephonically arranged illegal drug transactions with another drug dealer, who was his supplier operating in the Donalsonville area, for cocaine purchases. Because a wiretap had been placed on the other dealer's telephone, agents intercepted numerous calls between Mr. Kenon and his dealer when Mr. Kenon was requesting the illegal drugs for distribution to his customers.
A firearm was recovered during a search conducted on Mr. Kenon's residence.
"This sentence is what armed drug dealers can expect when they are prosecuted for federal drug and firearms offenses stemming from their illegal activities. There is no parole in the federal system, so Mr. Kenon will serve almost twenty-five years for these crimes," said United States Attorney Michael Moore.The case was investigated by the Drug Enforcement Agency. The case was prosecuted by Assistant United States Attorney Leah McEwen.
Inquiries regarding the case should be directed to Sue McKinney, Public Affairs Specialist, United States Attorney's Office at (478) 621-2602.
District Man Sentenced to 7 ½ Years in Prison for Stabbing Teenager Outside Howard TheatreDefendant Used Anti-Gay Slurs Prior to the Attack; Must Serve Additional Six Months for Separate Assault on A Corrections OfficerRead the Press Release
WASHINGTON – Ali Jackson, 20, was sentenced today to a 7 ½-year prison term on charges stemming from an attack in which he stabbed a 16-year-old victim after making threatening statements and anti-gay slurs, announced U.S. Attorney Ronald C. Machen Jr. and Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD).
Jackson, of Washington, D.C., pled guilty in January 2013 in the Superior Court of the District of Columbia to a charge of assault with intent to kill. The charge carried a bias enhancement. In addition, Jackson pled guilty to a charge of assault on a police officer stemming from a separate incident involving an attack against a corrections officer.
The Honorable Patricia A. Broderick sentenced Jackson to the 7 ½-year prison term for the attack and another six months in prison for the incident involving the officer. After serving the eight years of incarceration, Jackson is to be placed on three years of supervised release.
Two others, also of Washington, D.C., earlier pled guilty and were sentenced for their roles in the events on the night of the stabbing, which took place near the Howard Theatre.
Jackson’s sister, Alvonica Jackson, 26, pled guilty to simple assault and second-degree theft and was sentenced in March 2013 to a total of 360 days of incarceration, with all but 30 days suspended on the condition that she successfully complete two years of probation. Desmond Campbell, 34, the boyfriend of Alvonica Jackson, pled guilty to simple assault and was sentenced in March 2013 to 180 days of incarceration, with all but 30 days suspended on the condition that he successfully complete two years of probation.
“Violence fueled by hate tears at the fabric of our society,” said U.S. Attorney Machen. “It harms not only its direct victims, but spreads fear and intimidation throughout our community. As this prison sentence demonstrates, in the District of Columbia, we have zero tolerance for violent crimes driven by ignorant prejudice.”
“With today’s sentence, Ali Jackson must now face the consequences of his violent hate crime,” said Chief Lanier. “We hope that others who might consider committing bias-related offenses will pay attention to today’s sentencing and choose not to follow in Ali Jackson’s footsteps. I applaud the hard-working members of this department for their investigative efforts in helping to make today’s sentencing possible and the support of the U.S. Attorney’s Office for their outstanding work in this case.”
According to the government’s evidence, on June 26, 2012, at about 8:25 p.m., Campbell and Alvonica Jackson entered the Howard Theatre, in the 600 block of T Street NW, and headed to the restrooms. Alvonica Jackson stole $2 from the bathroom, and she and Campbell left.
Meanwhile, Ali Jackson had remained outside. He recognized the victim on the street at Georgia and Florida Avenues NW and started a confrontation with the teenager, who was there with a friend. Ali Jackson began using anti-gay slurs and asked a group of men nearby if they had a knife, saying he was about to stab the victim.
As the victim walked away, Ali Jackson ran down the 600 block of T Street and into an alleyway near the theater. He then came from the alley, toward the victim’s back. Once again using anti-gay slurs, he stated, among other things, “I’m going to kill you.”
As Ali Jackson got closer, he produced a knife and the victim sprayed him with pepper spray. Campbell then came behind the victim, choking him. Ali Jackson ran up to the victim and stabbed him with a knife three times – in the left arm, the left side of his back, and the left leg. During the stabbing, the victim was attempting to swing his arms at Ali Jackson, but Alvonica Jackson grabbed his arms. The assault stopped when the attackers heard police sirens.
Campbell and Alvonica Jackson also used slurs during the attack. All three defendants were arrested a short time later.
The second charge against Ali Jackson stemmed from an incident Dec. 15, 2012 at the District of Columbia Jail in which he punched a corrections officer.
In announcing the sentence, U.S. Attorney Machen and Chief Lanier praised the work of the detectives and officers from the MPD who investigated the case. They also acknowledged the efforts of those who handled the case for the U.S. Attorney’s Office, including Assistant U.S. Attorney Jonathan Kravis, who provided assistance at sentencing, and Paralegal Specialist Allison Daniels. Finally, they commended the work of former Assistant U.S. Attorney Mary Chris Dobbie and Assistant U.S. Attorney Jin Park, who prosecuted the case.
13-233District Man Pleads Guilty to Sexually Assaulting Woman After Entering Her Apartment-Cellphone and Other Evidence Tied Him to the Crime-Read the Press Release
WASHINGTON – Domingo Martinez, 26, of Washington, D.C., pled guilty today to charges stemming from a recent home invasion in which he sexually assaulted a woman who had been asleep in her apartment, U.S. Attorney Ronald C. Machen Jr. announced.
Martinez pled guilty in the Superior Court of the District of Columbia to one count each of second-degree burglary and assault with intent to commit first-degree sexual abuse. The Honorable John Ramsey Johnson scheduled sentencing for Sept. 20, 2013. Each of the charges carries a statutory maximum of 15 years in prison.
According to the government’s evidence, at about 2:30 a.m. on May 16, 2013, Martinez appeared inside a woman’s apartment in the 6700 block of 14th Street NW. The woman woke up to see him, wearing a shirt wrapped around his head that served as a mask. He held what at first appeared to be a gun and sexually accosted her.
Once Martinez was close enough to touch her, the victim realized that the object in his hand was a cellphone, not a gun. At this point, she decided to fight back and she bit him on the shoulder during a struggle. He pushed her, causing her to fall, and then ran away.
The victim pursued Martinez through a hallway and grabbed the shirt from his head. As he continued fleeing, he dropped the cellphone, which the victim also picked up. She then ran back to her apartment, locked the door behind her, and called 911 for help.
Based upon the telephone records for the abandoned cellphone, and its contents, including time-stamped photographs and video, police identified Martinez as a suspect and arrested him on May 21, 2013. He lived in the building where the attack took place. At the time of his arrest, Martinez had a bite mark, not yet fully healed, on his left shoulder.
In announcing the plea, U.S. Attorney Machen commended the work of the Metropolitan Police Department. He also praised the efforts of those who handled the case at the U.S. Attorney’s Office, including Criminal Investigator John Marsh, Victim/Witness Advocate Melissa Milam, and Paralegal Specialist D’Yvonne Key. Finally, he acknowledged the efforts of Assistant U.S. Attorney Heide L. Herrmann, who is prosecuting the matter.
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