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28 June 2013
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.
13-235District Court Enters Permanent Injunction Against New Jersey-Based Pharmacy and Company’s Senior ExecutiveRead the Press Release
U.S. District Court Judge Peter G. Sheridan entered a consent decree of permanent injunction against Med Prep Consulting Inc., a Tinton Falls, N.J., pharmacy licensed by the state of New Jersey, the Justice Department announced today. The permanent injunction was also entered against Gerald R. Tighe, president and owner of Med Prep.
Although operating as a state-licensed pharmacy, until it recently halted production, Med Prep manufactured numerous sterile drug products, including pain medications, anesthesia, operating room drugs and oncology and dialysis drugs and did not receive patient-specific prescriptions. As set forth in the complaint filed by the United States on June 24, the United States Food and Drug Administration (FDA) conducted an inspection of defendants’ facility from March 15, 2013 to April 3, 2013, and documented numerous deviations from current good manufacturing practice requirements for drugs. In addition, Med Prep did not have approved new drug applications or approved abbreviated new drug applications for any of the products it produced.
According to the complaint, the FDA found that the company failed to create and follow appropriate procedures to prevent contamination of drugs which were purported to be sterile. As stated in the complaint, FDA found that the company failed to properly clean and maintain its equipment to ensure the safety and quality of the drugs it manufactured, and that the company failed to conduct adequate investigations of injectable drugs that failed to meet minimum quality specifications. FDA’s recent inspection of the company followed reports that the company had distributed, to a Connecticut hospital, intravenous drug products containing visible contaminants that were confirmed to be mold. Med Prep voluntarily recalled all products in the field and has halted production.
Compliance with current good manufacturing practice requirements helps assure that drugs meet the safety requirements of the law and have the identity and strength and meet the quality and purity characteristics that they purport to or are represented to possess. FDA regulations, which establish minimum current good manufacturing practice requirements for drugs, require manufacturers to control all aspects of the processes and procedures by which drugs are manufactured in order to prevent the production of unsafe and ineffective products.
“Under this resolution, Med Prep cannot manufacture or distribute drugs until it fully complies with the consumer protections set forth in the law,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “Patients who take injectable drug products contaminated with mold are at risk of major illness or death. This settlement requires Med Prep to clean up its act before its products are allowed to return to market."
The consent decree entered by the district court resolves the complaint by requiring Med Prep to take a wide range of actions to correct its violations and ensure that they do not happen again. The injunction establishes a series of steps which must occur before Med Prep can resume drug manufacturing operations, including the retention of an expert to inspect the company’s manufacturing facility, the development and implementation of a remediation plan, and an inspection by FDA to confirm that the company’s manufacturing processes are fully compliant with the law.
“MedPrep put patients at risk by producing contaminated drugs under unacceptable conditions,” said Melinda K. Plaisier, Acting Associate Commissioner for Regulatory Affairs for the FDA. “The Department of Justice and FDA will continue to work together to protect the health of Americans by taking aggressive enforcement actions to ensure the safety of drugs.”
Acting Assistant Attorney General Delery thanked the FDA for referring this matter to the Department of Justice and the U.S. Attorney’s office in New Jersey for their contributions to the case. Phil Toomajian, Trial Attorney of the Consumer Protection Branch of the Civil Division of the Justice Department and Scott Kaplan, Associate Chief Counsel of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services, brought this case on behalf of the United States.Denver Man Pleads Guilty to Multi-Million Dollar Real Estate SchemeRead the Press Release
DENVER – Roger K. Howard, age 50, of Englewood, Colorado, pled guilty recently before U.S. District Court Judge R. Brooke Jackson to three counts of wire fraud and one count of money laundering, the United States Attorney’s Office, IRS Criminal Investigation and the Federal Bureau of Investigation announced. Howard, who is free on bond, is scheduled to be sentenced by Judge Jackson on August 26, 2013. Howard’s co-defendant, Oai Quang Luong pled guilty to three counts of wire fraud on May 22, 2013 and is scheduled to be sentenced on August 15, 2013.
Howard and Luong were indicted by a federal grand jury in Denver on January 25, 2012. According to the facts contained in the indictment as well as the stipulated facts contained in the plea agreement, in 2006 and 2007, Howard devised and participated in three similar but separate mortgage-fraud schemes. The first and larger scheme involved the sales of twenty-six town homes in a development known as Oliveglen Villas on East Princeton Place, Aurora, Colorado. The second scheme involved the sale of a residence in Castle Rock, Colorado, and the third a house in Denver, Colorado. During the relevant times, Howard operated under the business names of Spring Creek Mortgage Real Estate Services and Open Range Development LLC. Howard controlled bank accounts in the names of both companies. Also at the relevant time, Howard’s co-defendant, Oai Luong, worked for a company that processed mortgage loan applications on behalf of potential home buyers. Both Howard and Luong had offices in the same building in Centennial, Colorado.
By the middle of 2006, the developer of Oliveglen Villas had accumulated an inventory of unsold town homes. At that time, two real estate agents attempted to obtain the right to buy some of the town homes, but they were unsuccessful. The agents then were referred to Howard, who told them that he could arrange for individuals, whom he described as investors, to purchase the properties. In August 2006, Howard asked Luong to obtain the $250,000, and Luong did so, using funds loaned by another individual. Howard persuaded seventeen individuals, his so-called investors, to purchase the town homes.
Howard arranged for the individuals to obtain the mortgage loans, and in doing so he knowingly caused the applications for those mortgages to include false or misleading information or omit material information. Many of the applications overstated borrowers’ monthly incomes, often claiming incomes were more than double the actual amounts. Loan applications also contained false information about borrowers’ assets, usually bank account balances. As part of the mortgage application process, a borrower obtained from his or her bank a form known as a Request for Verification of Deposit (VOD), which verified the balance of an account. In this case, VODs were misleading because Howard and others working at his direction arranged for bank account balances to be inflated temporarily; that is, money was deposited into the accounts and, after the balances were verified and the VODs were completed, the money was withdrawn. All of the town-home sales prices were supported by appraisals, most of which were done by an associate of Howard’s which he told the appraiser the amount he wanted.
For each closing, the closing agent prepared a settlement statement, reflecting that the disbursements of loan proceeds included a payment “from Seller’s Funds at Settlement” to Open Range Development. These payments were the “service fees” mentioned in the contract with the developer; they ranged from $85,700 to $117,204. After the closings, Howard used some of that money to make payments to all but one of the buyers, but those payments were not disclosed to the lenders or their underwriters. Howard for a time wrote checks payable to the borrowers to cover the differences between rental incomes and mortgage payments, but he stopped doing so on April 19, 2007. A few borrowers thereafter used their own money to make mortgage payments, but eventually all of the mortgages went into default and the lenders foreclosed. At that point, there were about twelve different lenders holding the mortgages on the town homes, and they lost approximately $7,609,729.31.
“The real estate fraud perpetrated by the two defendants in this case not only impacts the victims who were caught up in the scheme, it also impacts the mortgage lending system, which ultimately effects everyone who is interested in home ownership,” said U.S. Attorney John Walsh.
"Buyer beware, schemes like this can cause financial havoc for those that are left holding the mortgage, said Stephen Boyd, Special Agent in Charge, IRS Criminal Investigation, Denver Field Office. "Those who line their pockets with profits from these schemes should know they will not go undetected and will eventually be held accountable."
“This guilty plea should send a strong message to anyone considering deceiving others with mortgage fraud,” said FBI Denver Special Agent in Charge Thomas Ravenelle. “The FBI will continue to work with our law enforcement partners to protect financial institutions and our economy from those engaged in these types of fraudulent schemes.”
Wire fraud carries a penalty of not more than 20 years in federal prison and a fine of up to $250,000 per count. Money Laundering carries a penalty of not more than 10 years in federal prison and a fine of up to $250,000 per count.
This case was investigated by agents with Internal Revenue Service Criminal Investigation (IRS-CI) and the Federal Bureau of Investigation (FBI).
The case is being prosecuted by Assistant United States Attorney Suneeta Hazra.####
David C. Hollingsworth Sentenced for Assault on Navy BaseRead the Press Release
DAVID C. HOLLINGSWORTH, 49, of New Orleans, Louisiana, was convicted and sentenced today by United States Magistrate Judge Sally Shushan for simple assault on a Department of Defense Police Officer, announced U. S. Attorney Dan J. Boente.
HOLLINGSWORTH, who previously pled guilty in August of 2012 to an Indictment for Receipt of Materials Involving the Sexual Exploitation of Minors and is serving 5 years incarceration, was sentenced to six (6) months of incarceration, to be served consecutively to the sexual exploitation sentence.
On August 9, 2010, HOLLINGSWORTH pointed an assault style rifle at an off duty Department of Defense Police Officer while on Naval Air station/Joint Reserve Base in Belle Chasse, Louisiana. HOLLINSWORTH was disarmed and arrested by Base Security and later charged with assault.
This case was investigated by special agents from the Naval Criminal Investigative Service (NCIS) and prosecuted by Assistant U. S. Attorneys Edward J. Rivera and Brian M. Klebba.
Couple Indicted for Making False Tax ClaimsRead the Press Release
MINNEAPOLIS—A federal indictment unsealed recently charges a couple with defrauding the Internal Revenue Service (“IRS”) by filing false individual income tax returns that claimed refunds to which they were not entitled. The indictment, which was filed under seal on June 18, 2013, charges Mark Allen Garcia and Patricia Ann McQuarry with one count of conspiracy to defraud the United States and two counts of making false claims. The indictment was unsealed following the defendants’ initial appearance in federal court on June 19. Earlier today, both were arraigned.
The indictment alleges that between July 2008 and November 2009, the married defendants conspired to obtain money by filing false U.S. Individual Income Tax Returns for tax years 2007 and 2008. Those allegedly fraudulent returns claimed unentitled refunds and, in one instance, resulted in the IRS paying a false refund of approximately $226,000.
For tax years 2007 and 2008, both defendants filed self-prepared tax returns as “married filing separately.” In her return, McQuarry allegedly stated that she had received more than $127,000 in original issue discount (“OID”) income from several financial institutions, and that the entire amount had been withheld and paid, when in fact, none of the listed financial institutions had paid McQuarry any OID income. By creating false withholdings in the amount of her claimed OID income, McQuarry manufactured a large federal refund.
In addition, both defendants allegedly included false interest income from various financial institutions on their tax returns. In fact, only one of the listed institutions paid the defendants any interest income at all. By creating the false withholdings, both defendants manufactured large tax refunds for tax years 2007 and 2008.
For his part, Garcia allegedly applied for and obtained a “Refund Transfer” from a financial institution in connection with his 2007 tax return. The IRS disbursed Garcia’s federal tax refund, which he allegedly knew was false, to the financial institution, which transferred the refund to his bank account.
As a result of the conspiracy, the defendants allegedly made more than $500,000 in false claims to the IRS.
If convicted, the defendants face a potential maximum penalty of ten years in prison for conspiracy and five years on each count of making a false claim. Any sentence would be determined by a federal district court judge.
This case is the result of an investigation by the IRS-Criminal Investigation. It is being prosecuted by Assistant U.S. Attorney Kimberly A. Svendsen.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. Per U.S. Department of Justice policy, the U.S. Attorney’s Office is not allowed to provide the age and city of residence for defendants charged in criminal tax cases.
Contrack International Inc. Agrees to Pay $3.5 Million to Resolve False Claims Act AllegationsRead the Press Release
WASHINGTON - Contrack International, Inc., a global design and construction company headquartered in McLean, Virginia, has agreed to pay $3.5 million to settle allegations that it submitted false claims in connection with United States Agency for International Development (USAID) contracts, the Justice Department announced today.
“Misrepresentations during contract negotiations undermine the integrity of the government procurement process,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “The Justice Department will take action where contractors misrepresent their qualifications for government contracts and programs.”
“Proper public contracting, government efficiency and government accountability rely on full and complete information from contractors,” said Wendy J. Olson, United States Attorney for the District of Idaho. “Along with our partners at USAID and the Department of Justice’s Commercial Litigation Branch, we will aggressively seek to recover improperly awarded public dollars.”
The settlement concerns USAID-funded contracts for the construction of water and wastewater infrastructure projects in the Arab Republic of Egypt in the 1990s. The bidders for these contracts were required to receive prequalification and, in some cases, establish that they were United States companies. The contracts were ultimately performed by a joint venture partnership between Contrack, Washington Group International, Inc. (WGI), a subsidiary of URS Corporation, and Misr Sons Development S.A.E. (HAS), an Egyptian company. The United States filed suit under the False Claims Act and the Foreign Assistance Act alleging that the joint venture partners evaded the prequalification requirement by concealing the identity of the joint venture partners, which prevented USAID from evaluating their qualifications. As a result, the United States alleges that Contrack and its partners received USAID-funded contracts for which they were ineligible. The settlement resolves only Contrack’s liability. The United States is continuing to pursue its claims against the other defendants in the suit.
This settlement was the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the District of Idaho; and the USAID Office of Inspector General.
The case is United States v. Washington Group International Inc. f/k/a/ Morrison Knudsen, Corporation, Contrack International, Inc.; and Misr Sons Development S.A.E. a/k/a Hassan Allam Sons, No. 04-555 (N.D. Idaho). The claims resolved by this settlement are allegations only and there has been no determination of liability.
Connecticut Man Sentenced for Claiming to Operate Minority, Service-Disabled Veteran BusinessRead the Press Release
BOSTON – A Woodstock, Conn. man was sentenced yesterday in U.S. District Court in Worcester for conspiring to defraud the Small Business Administration and other government contractors by falsely representing that his business was a minority and service-disabled veteran-owned and operated business.
Brian Bauman, 38, was sentenced by U.S. District Judge Timothy S. Hillman to two years probation with six months to be served in home detention with electronic monitoring, forfeiture of $38,000, and completion of 200 hours of community service, preferably to be performed in a setting working on behalf of veterans. In September 2010, Bauman pleaded guilty to conspiring to commit wire fraud.
Jones and his co-conspirators submitted false statements to the Small Business Administration and other government agencies, in order to get federal government contract awards that were set aside for or preferentially awarded to disadvantaged minority and service-disabled veteran-owned and operated businesses. The submissions falsely represented that their company was owned and managed by a minority and service-disabled veteran who purportedly managed the daily operations of the business
United States Attorney Carmen M. Ortiz; Jeffrey Hughes, Special Agent in Charge of the U.S. Department of Veterans Affairs, Office of Inspector General, Northeast Field Office; Luis A. Hernandez, Special Agent in Charge of the U.S. General Services Administration, Office of Inspector General, Office of Investigations; Michael D. Conner, Special Agent in Charge of the U.S. Army Criminal Investigation Command, Hartford Fraud Resident Agency; Daniel J. O’Rourke, Assistant Inspector General, U.S. Small Business Administration, Office of Inspector General, Investigations Division; and Robert L. Panella, Special Agent in Charge of the U.S. Department of Labor, Office of Inspector General, Labor Racketeering and Fraud Investigations, New York Regional Office, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Sara Miron Bloom of Ortiz’s office.
Citizen of Guatemala Sentenced to 21 Months in Prison for Illegally Reentering U.S. After DeportationRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, today announced that LUSVIN LEONEL OLIVA-AQUINO, 27, a citizen of Guatemala last residing in Stamford, was sentenced yesterday by United States District Judge Robert N. Chatigny in Hartford to 21 months of imprisonment for illegally reentering the United States after he was deported.
According to court documents and statements made in court, OLIVA-AQUINO illegally entered the U.S. sometime prior to April 24, 2008, when he was arrested by the Stamford Police Department on charges of second degree sexual assault and risk of injury to a minor. The charges stemmed from OLIVA-AQUINO’s illegal sexual contact with a 13-year-old girl. He was convicted of both offenses and sentenced to eight years of incarceration, execution suspended, with one year to serve, and a total of 10 years of probation. OLIVA-AQUINO was deported to his native Guatemala in October 2009.
On October 3, 2012, OLIVA-AQUINO was arrested by Stamford Police for motor vehicle offenses.
OLIVA-AQUINO has been detained since his arrest. On February 7, 2013, he pleaded guilty to one count of illegal reentry of a removed alien.
This matter was investigated by U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations, with the assistance of the Stamford Police Department. The case was prosecuted by Assistant United States Attorney Deborah R. Slater.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Cedar Rapids Safe Streets Task Force Reports Several New Firearms ArrestsRead the Press Release
The Cedar Rapids Safe Streets Task Force continues to make Cedar Rapids safer. United States Attorney Sean R. Berry reported the Task Force’s recent accomplishments at a press conference held at the Cedar Rapids Police Department. Other participants in the press conference included Linn County Attorney Jerry Vander Sanden, Federal Bureau of Investigation Special Agent in Charge Thomas Metz, and Cedar Rapids Police Chief Wayne Jerman.
“The Safe Streets Task Force targets the most dangerous criminal offenders in our area – with a special focus on those who unlawfully use and possess firearms” said Berry. “This focus helps ensure the public’s law enforcement resources are put to their best and most efficient use.”
In June 2009, following a spike in violent crime in the Cedar Rapids area, federal, state and local law enforcement agencies met to share intelligence regarding local gang activity and to assess the need for a formal task force to combat gang, drug, and violent criminal activity. As a result, the Cedar Rapids Safe Streets Task Force was formed in September of 2009. The task force acts as a repository for gang related intelligence in the Cedar Rapids area and coordinates federal, state and local resources to target the worst and most dangerous offenders in the area.
The task force today is led by the Federal Bureau of Investigation and composed of representatives from the Cedar Rapids Police Department and the Sixth Judicial District Department of Correctional Services. Task force personnel work closely with the Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms, and Explosives; Homeland Security Investigations; United States Marshals Service; Iowa Division of Criminal Investigation; Marion Police Department; Linn County Sheriff’s Office; and Iowa Department of Inspections and Appeals. Task force cases are prosecuted by the United States Attorney’s Office and the Linn County Attorney’s Office.
Resources from the Safe Streets Task Force are available to all law enforcement agencies with related investigations, whether or not those agencies are members of the task force.
According to Special Agent in Charge Thomas Metz of the FBI, “the Cedar Rapids Safe Streets Task Force combines federal law enforcement’s national perspective and resources with local law enforcement’s experience and familiarity in the local community. This formula has worked well in other parts of the country since 1992 and has been an effective means of addressing local gang, drug and violent crime here in Cedar Rapids.”
“I am committed to keeping the streets of Cedar Rapids safe,” said Cedar Rapids Police Chief Wayne Jerman. “One way we will do this is by holding offenders accountable. If someone commits a crime in Cedar Rapids with a weapon, expect to be arrested and prosecuted to the fullest extent. It is through partnerships with the Department of Corrections and the FBI, that we can form the Safe Streets Task Force and arrest those that violate our gun laws. And with prosecution from the United States Attorney’s and Linn County Attorney’s offices, we are able to hold offenders accountable to the fullest extent. The Cedar Rapids Police Department will not tolerate violence, especially violence with the use of a firearm in Cedar Rapids.”
Linn County Attorney Jerry Vander Sanden said, “through a collaborative teamwork approach, the Cedar Rapid's Safe Streets Task Force has demonstrated great success in apprehending and prosecuting violent offenders which makes our community a safer place in which to live. The Linn County Attorney’s Office is grateful to be a part of this effort and we are committed to promoting the objectives of the task force by concentrating our resources on the vigorous prosecution of those who commit crimes of violence.”
In recent weeks, the task force’s work has resulted in the following matters in federal court in Cedar Rapids:
Recent Arrests and Indictments
● On June 27, 2013, Clyde Bell Jr. was arrested on charges of unlawfully possessing a .25 caliber semi-automatic handgun. Bell allegedly possessed the handgun on or about April 23, 2013 following a felony conviction in Cook County, Illinois, for aggravated unlawful use of a weapon, and following a misdemeanor conviction in Linn County, Iowa, for domestic abuse assault causing injury. The case file number is CR 13-34.
● On June 27, 2013, Dustin Whitford was indicted on charges of unlawful possession of a .360 caliber pistol. Whitford allegedly possessed the pistol on or about June 19, 2013, following a felony conviction for possession of drug precursors in Linn County, Iowa. Whitford is in law enforcement custody pending his first appearance in federal court. The case file number is CR 13-50.
● On June 27, 2013, Ramius Hardiman made his first appearance in federal court on charges of unlawfully possessing a 9 millimeter pistol. Hardiman allegedly possessed the pistol on or about May 8, 2013 following a felony conviction in Linn County, Iowa, for involuntary manslaughter. The case file number is CR 13-37.
● On or about June 27, 2013, Demetrius Hardiman was arrested on charges of unlawfully disposing of a 9 millimeter pistol to Ramius Hardiman, knowing and having reasonable cause to believe Ramius Hardiman had been convicted of a crime punishable by imprisonment for a term exceeding one year. Demetrius Hardiman allegedly gave the pistol to Ramius Hardiman on or about May 8, 2013. The case file number is CR 13-37.
● On or about June 27, 2013, Eric Lavell Johnson was arrested on charges of unlawfully possessing two .22 caliber firearms. Johnson allegedly possessed the firearms on or about February 19, 2013 while Johnson was an unlawful user of marijuana. Johnson has also been charged with possession of marijuana with intent to distribute on or about February 19, 2013. The case file number is CR 13-39.
● On or about June 26, 2013, Rhamond Bolden was arrested on charges of unlawfully possessing a 9 millimeter pistol and ammunition. Bolden allegedly possessed the firearm and ammunition on or about April 7, 2013 while Bolden was an unlawful user of marijuana. The case file number is CR 13-40.
● On June 26, 2013, Austin Curtis was indicted on charges of unlawfully possessing a 9 millimeter pistol while being a fugitive from justice. Curtis allegedly possessed the firearm on or about April 22, 2013. Curtis is in law enforcement custody pending his first appearance in federal court. The case file number is CR 13-46.
● On June 26, 2013, Colby Palmer was indicted on charges of unlawfully possessing a .357 magnum revolver, .357 magnum ammunition, and a .22 caliber pistol. Palmer allegedly possessed the firearms and ammunition on or about June 6, 2013 following felony convictions for burglary and interference with the official acts of a correctional officer inflicting bodily injury in Linn County, Iowa. Palmer is in law enforcement custody pending his first appearance in federal court. The case file number is CR 13-41.
● On June 26, 2013, Daevon Evans was indicted on charges of unlawfully possessing a 9 millimeter pistol. Evans allegedly possessed the pistol on or about June 23, 2013 while Evans was an unlawful user of marijuana. Evans is in law enforcement custody pending his first appearance in federal court. The case file number is CR 13-43.
● On June 4, 2013, William Robison was indicted on charges of unlawfully possessing a 9 millimeter handgun with an obliterated serial number and unlawful possession of 9 millimeter ammunition. Robison allegedly possessed the firearm and ammunition on or about April 18, 2013 while Robison was an unlawful user of marijuana. Robison is in law enforcement custody pending his first appearance in federal court. The case file number is CR 13-35.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
Recent Convictions and Sentences
● On June 4, 2013, Kelsey Beckett was sentenced to 30 months’ imprisonment for possession of a firearm with an obliterated serial number. Beckett’s co-defendant, Andre Kase, was sentenced on May 9, 2013, to 71 months’ imprisonment for being a felon in possession of a firearm. Beckett and Kase were arrested together on October 8, 2012, after a neighbor reported they were attempting to break into a house in Cedar Rapids. Both were found to be in possession of loaded firearms. The case file number is CR 12-55.
● On May 21, 2013, Gregory Givens was convicted by a jury of one count of being a felon in possession of a firearm, and one count of possession of crack cocaine with intent to distribute. Evidence at trial showed that, on October 7, 2010, Givens was stopped by a Cedar Rapids police officer for a traffic violation. Givens was found to have a large quantity of marijuana and a box of 9 millimeter ammunition in the car. A December 22, 2010, search warrant at Givens’ residence produced additional marijuana and crack cocaine. Givens had previously been convicted in Cook County, Illinois, of felony possession of cocaine with intent to deliver. The case file number is CR 12-55.
● On May 7, 2013, Kevin Herring was sentenced to 90 months’ imprisonment for being a felon and domestic abuser in possession of a firearm. The sentence followed Herring’s guilty plea for possessing an assault rifle on March 24, 2012. Herring had three prior convictions for domestic abuse assault and one prior conviction for domestic abuse assault causing bodily injury; all in Linn County, Iowa. Herring also had one prior conviction for felony possession of a controlled substance from Cook County, Illinois. The case file number is CR 12-93.
Request for Public Assistance
Law enforcement is also seeking the public’s assistance in locating the following person in connection with federal weapons charges:
● Name: Andre Corbett
Age: 24
Height: 5 ft. 10 in.
Weight: 220 lbs.
Last known address: 11 Glenbrook Dr. SE # 204, Cedar Rapids
[photo at http://www.justice.gov/usao/ian/press/Jun_13/Corbett_Andre.pdf]Anyone who knows the whereabouts of this person is asked to call the Cedar Rapids Police Department at 286-5491, or Linn County Crime Stoppers at 1-800-CS-Crime (272-7463) to report information anonymously. Persons can also provide information via text message by sending a text to CRIMES (274637) and, in the message/subject area, type 5227 along with the information.
Buffalo Men Plead Guilty to Concaine ChargesRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Michael Smerka, 56, James Simmons, 38, and Timothy Borkowski, 46, all of Buffalo, New York, pleaded guilty to cocaine trafficking before U.S. Magistrate Judge Leslie G. Foschio. The charge carries a maximum penalty of 20 years in prison, a $1,000,000 fine or both.
According to Assistant U.S. Attorney Michael L. McCabe, who is handling the case, the defendants purchased cocaine at an auto shop on Broadway Street in Sloan. The men then sold the cocaine to a network of customers in the Buffalo and Cheektowaga areas.
The guilty pleas follow a lengthy investigation into drug-trafficking in Cheektowaga and Buffalo's East Side which resulted in the arrests of ten defendants in June 2011. To date, seven defendants have been convicted.
"This is second significant criminal organization convicted in two days," said U.S. Attorney Hochul. "One tried to take over a business, the other a neighborhood. In both cases, law enforcement working with the community removed the threat. Our Office will continue to work with our law enforcement partners to pursue such organizations."
The pleas are the culmination of an investigation by the Federal Bureau of Investigation's Safe Streets Task Force, under the direction of Acting Special Agent in Charge Richard M. Frankel, and the Cheektowaga Police Department, under the direction of Chief David Zack.Brooklyn Woman Convicted of Shipment of $1 Million Worth of Stolen Luxury Vehicles to AfricaRead the Press Release
CAMDEN, N.J. – A federal jury convicted Hope K. Kantete today for her role as the leader of a ring that was responsible for shipping dozens of stolen and carjacked luxury cars and SUVs worth more than $1 million from New Jersey to Africa.
Kantete, 43, of Brooklyn, was convicted of 10 counts of transportation of stolen vehicles in interstate or foreign commerce and a single count of conspiracy to transport stolen vehicles in interstate or foreign commerce. Kantete was convicted after a three-week trial before U.S. District Judge Robert J. Kugler in Camden federal court.
After the jury returned its verdict, Kantete’s bail was revoked in anticipation of her sentencing date on Oct. 3, 2012. As a result of the conviction, Kantete faces up to 15 years in prison.
According to documents filed in this case and the evidence presented at trial:
The stolen car exportation ring was investigated by a multi-agency task force led by the U.S. Department of Homeland Security/Immigration and Customs Enforcement. The investigation revealed that Kantete employed other individuals who were responsible for purchasing stolen and carjacked vehicles from thieves operating in Northern New Jersey and New York. Kantete then had individuals “re-tag,” or place new vehicle identification numbers, on the stolen cars and create fraudulent title documents so that the cars could be shipped out of the country. After the documents were created, Kantete arranged to have the cars loaded onto shipping containers and sent to ports in West Africa. The cars could be re-sold in West Africa for at least twice their retail value in the United States.
U.S. Attorney Fishman credited special agents of HSI, under the leadership of Executive Associate Director James Dinkins and Special Agent in Charge Andrew M. McLees, and the N.J. State Police, under the direction of Superintendent Col. Rick Fuentes, for the investigation leading to today’s arrests. He also thanked U.S. Customs and Border Protection; the Waterfront Commission of New York Harbor; Essex County Prosecutor Carolyn Murray, Middlesex County Prosecutor Andrew Carey, Acting Hudson County Prosecutor Gaetano T. Gregory, and Union County Acting Prosecutor Grace H. Park, the Essex and Hudson County Sheriff’s Departments, the Newark Police Department, the U.S. Coast Guard Investigative Service and the Port Authority of New York and New Jersey for their roles.
The government is represented by Assistant U.S. Attorney José R. Almonte and James M. Donnelly of the U.S. Attorney’s Office Criminal Division in Newark.13-272
Defense counsel: Brian J. Neary Esq., Hackensack, N.J.
Boston Man Sentenced in Armed RobberyRead the Press Release
BOSTON – A Boston man was sentenced today for the armed robbery of a Dorchester Metro PCS retail store in 2011.
Lynch Arthur, 42, was sentenced by U.S. District Judge Denise J. Casper to 19 years in prison, to be followed by five years of supervised release and a $300 special assessment. In March 2013, Arthur pleaded guilty to armed robbery, using and carrying a firearm during a crime of violence, and being a previously convicted felon in possession of a firearm.On Oct. 31, 2011, two men, later identified as Arthur and Ronald E. Brown, entered the Metro-PCS store on Washington Street in the Codman Square section of Dorchester. Brown distracted the store clerk while Arthur walked around the counter, displaying a semi-automatic handgun. After arming themselves with semi-automatic handguns, they forced the clerk into the back storage room and demanded cash. Using a roll of duct tape he was carrying, Arthur tied up the clerk. They removed cash from the register and fled the scene, running on Kenwood Street where they were stopped and questioned. The officers observed articles of clothing, reportedly worn by the subjects, on the sidewalk. After a sweep of the area, officers recovered the loaded firearms, duct tape, and U.S. currency consistent with the amount stolen. The individuals were brought back to the store and positively identified by the clerk.
The co-defendant, Brown, of Boston was convicted following a jury trial on June 3, 2013. He is scheduled to be sentenced in August 2013.
United States Attorney Carmen M. Ortiz, Boston Police Commissioner Edward Davis, and Kenneth J. Croke, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Kenneth G. Shine and Robert E. Richardson of Ortiz's Major Crime Unit.
Avon Man Charged with StructuringRead the Press Release
Larry T. Chuppa was charged today with one count of structuring cash deposits into a financial institution in order to evade bank reporting requirements, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
According to court records, Chuppa, 57, currently resides in Avon, Ohio.
Between December 2011 through March 2012, Chuppa made a series of cash deposits at Fifth Third Bank for the purpose of evading reporting requirements, according to the information.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
This case is being prosecuted by Special Assistant United States Attorney Perry D. Mastrocola, following an investigation by the Internal Revenue Service, Criminal Investigation.
Another Sentenced in Relation to Drug and Murder-for-Hire ConspiracyRead the Press Release
LAREDO, Texas – Calvin Epps, 29, of Hopkins, S.C., has been ordered to prison in a drug conspiracy that has also resulted in the conviction of others in a conspiracy to commit murder-for-hire, United States Attorney Kenneth Magidson announced today. Epps, 29, of Hopkins, S.C., was convicted in November 2012 along with Samuel Walker, 29, of Sharon, Miss., following a seven-day trial. Five others entered guilty pleas in relation to the case - Mario Corley, 41, of Saginaw; Marcus Mickle, 21, Robert Corley, 24, and Kevin Corley, 30, all of Columbia, S.C.; and Shavar Davis, 30, of Denver, Colo.
Today, Senior United Sates District Court Judge George P. Kazen sentenced Epps to respective sentences of 120 and 60 months imprisonment for the conspiracy related to drug trafficking and for possessing a firearm during in and in relation to a drug trafficking crime. The sentences will be served consecutively. He was further ordered to pay a $3,000 fine and he will be on supervised release for five years following his 15-year federal sentence.
According to the evidence presented at trial, the investigation began in January 2011 when Mickle began negotiations with persons whom he thought were members of the Los Zetas Cartel, actually undercover Drug Enforcement Administration (DEA) agents, to purchase marijuana in return for stolen weapons. According to the testimony of DEA agents, the discussions concerned the distribution of marijuana in the Columbia area and how Mickle and Epps told undercover agents about a friend in the military who could provide military weapons to them. The agents were later introduced to Kevin Corley, who identified himself as an active duty officer in the Army responsible for training soldiers. According to the agents’ testimony, Kevin Corley offered to provide tactical training for cartel members and to purchase weapons for the cartel.
Over the next several months, Kevin Corley continued to communicate with undercover agents regarding the services he could provide the cartel as a result of the training, experience and access to information/equipment afforded him as an active duty soldier. He later agreed to bring a team and raid a ranch located at or near Laredo containing 20 kilograms of cocaine and conduct a contract killing there in return for a $50,000 fee and five kilograms of cocaine.
During March 2012, Corley arranged for 300 pounds of marijuana to be delivered to Mario Corley in Charleston, S.C. Kevin Corley, Mickle and Epps also brokered 500 pounds of marijuana and five kilograms of cocaine and discussed the distribution of these narcotics in South Carolina, Texas and Colorado.
According to testimony, Kevin Corley further offered to provide security for Mickle and Epps’ purchase of 500 pounds of marijuana for transport from Texas to South Carolina. On Jan. 14, 2012, Kevin Corley, Epps and Mickle all loaded the marijuana into a tractor trailer and attempted to escort it back to South Carolina. However, the tractor-trailer carrying the load was stopped and seized in La Salle County.
On March 24, 2012, undercover agents met with Epps and Mickle in Columbia at a motel parking lot. During this meeting, Epps and Mickle discussed with the undercover agent the pre-arranged purchase of five kilograms of cocaine and 500 pounds of marijuana for which Epps and Mickle were supposed to provide $50,000 as an initial payment. During the meeting, Epps and Mickle were arrested. Epps had a loaded Raven Arms Model MP-25 handgun in his right cargo pants pocket, while Mickle had a loaded Springfield Armory XD-40 handgun as well as a loaded spare magazine. Epps testified at trial that he was not involved in the purchase of the cocaine, only the marijuana and denied intending to carry the Raven Arms handgun as a part of the drug deal.
Also on March 24, Kevin Corley, Walker and Davis traveled to Laredo and met with undercover agents, at which time they discussed the location of the intended victim of the murder-for-hire, the logistics of performing the contract kill and their respective roles. They were soon thereafter arrested and a fourth suspect was shot and killed. Several firearms and ammunition was located within the vehicle in which they arrived.
Walker and Mickle have also been sentenced to 15 years in this case, while Davis received a sentence of 10 years in federal prison. Robert Corley, who pleaded guilty to the marijuana conspiracy, was previously sentenced to 30 months in prison. The remaining two co-defendants, Kevin Corley and Mario Corley have not yet been scheduled for sentencing.
The investigation leading to the charges was conducted by the DEA and the FBI with the assistance of U.S. Army Criminal Investigation Division. The case is being prosecuted by Assistant United States Attorneys Roberto Ramirez and Jody Young.Another Plea in Panama Unit CaseRead the Press Release
McALLEN, Texas – Another man has been convicted in relation to the investigation involving the now defunct Panama Unit, United States Attorney Kenneth Magidson announced today. Fabian Rodriguez, 28, of Edinburg, pleaded guilty to one count of conspiring to possess with the intent to distribute more than five kilograms of cocaine and more than 500 grams of methamphetamine.
Rodriguez was a former Hidalgo County Sheriff’s deputy who was a member of the former Panama Unit - a drug task force operated by the Hidalgo County Sheriff’s Office.
During 2011 and 2012, Rodriguez utilized his position as a law enforcement officer to traffic narcotics. Rodriguez admitted he used his law enforcement authority to steal narcotics which he and the others sold to local drug dealers.
Rodriguez faces a minimum of 10 years and up to life in prison along with a potential fine up to $10 million. Sentencing has been set for Sept. 10, 2013.
The investigation leading to the charges was conducted by the Drug Enforcement Administration, Homeland Security Investigations, FBI, Homeland Security Investigations - Office of Professional Responsibility and the Texas Department of Public Safety. Assistant United States Attorneys James Sturgis and Anibal Alaniz are prosecuting the case.
27 June 2013
Wilcox County Deputy Sheriff Arrested for Transporting DrugsRead the Press Release
Montgomery, Alabama – Greg Barge, 45 years old, of Camden, Alabama was arrested yesterday for attempting to possess with the intent to distribute cocaine powder, announced George L. Beck, Jr., United States Attorney for the Middle District of Alabama.
According to the complaint filed in federal court, on April 10, 2013, May 7, 2013 and June 26, 2013, Barge transported a package that contained what he believed to be multi-kilograms of cocaine powder from Montgomery, Alabama to Camden, Alabama. The package actually contained a substance that appeared to be cocaine, but was not cocaine. On each of those dates, Barge obtained the supposed kilograms of cocaine in Montgomery and transported them to Camden using his law enforcement vehicle and dressed in his sheriff’s deputy uniform. Barge was paid $800 on April 10, 2013 and $1200 on May 7, 2013. On June 26, 2013, Barge was arrested in Camden after transporting the kilograms of fake cocaine from Montgomery to Camden.
An arrest warrant and complaint merely allege that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Barge faces a minimum sentence of 5 years in prison. He is also subject to fines and a period of supervised release if convicted.
The case was investigated by the Federal Bureau of Investigation, with assistance from the Alabama Alcoholic Beverage Control Board and the Alabama Department of Public Safety. Assistant United States Attorney Clark Morris is prosecuting the case.
Washington State Man Pleads Guilty to Federal Hate Crime in Attack on Sikh ManRead the Press Release
The Department of Justice today announced Jamie Larson, 49, pleaded guilty in U.S. District Court in Seattle to a federal hate crime relating to a racially-motivated assault of a 50-year-old Sikh man who works as a taxi cab driver.
Jamie Larson pleaded guilty to one count of violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act that was enacted in October 2009. The indictment alleges that on Oct. 17, 2012, Larson assaulted the victim, who is from India, based upon the victim’s actual and perceived race, color and national origin, which included Middle Eastern and Arab descent. The defendant was arrested at the scene of the attack after a witness called 911.
According to the documents filed in court, the victim was called to drive Larson to an address in Federal Way, Wash. When the taxi arrived at the destination, the driver got out of the taxi and Larson got out and attacked the driver, grabbing his beard, pulling him to the ground, punching and stomping on his head and body. Larson uttered racial slurs and insults about the vicitm’s perceived ancestry during the attack. The victim suffered damage to his back, shoulder and kidney. He was hospitalized for more than a week and has undergone lengthy physical therapy.
“This case is a testament to the Justice Department’s dedication to vigorously investigate and prosecute all racially-motivated attacks,” said Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division. “It is unacceptable that violent acts of hate committed because of someone’s race and ethnicity continue to occur, and the department will continue to use every available tool to identify and prosecute hate crimes whenever and wherever they occur.”
“Acts of hate, such as this one, hurt not only the victim, but tear at our social fabric. They cannot be tolerated in our community,” said U.S. Attorney for the Western Distrcict of Washington Jenny A. Durkan. “The Shepard-Byrd Act is an important tool for holding defendants accountable.”
The charge carries a statutory maximum of 10 years in prison. Sentencing is scheduled in front of U.S. District Judge John C. Coughenour on Nov. 5, 2013.
The Shepard-Byrd law criminalizes acts of physical violence causing bodily injury motivated by any person’s actual or perceived race, color, national origin, religion, sexual orientation, gender, gender identity or disability.
The matter was investigated by the Seattle Division of the FBI. The Federal Way Police Department provided significant support in this prosecution. The case is being prosecuted by Assistant U.S. Attorney Bruce F. Miyake of the U.S. Attorney’s Office for the Western District of Washington and Trial Attorney Nicholas Durham of the U.S. Department of Justice’s Civil Rights Division.Washington State Man Pleads Guilty to Federal Hate Crime in Attack on Sikh ManRead the Press Release
WASHINGTON – The Department of Justice today announced Jamie Larson, 49, pleaded guilty in U.S. District Court in Seattle to a federal hate crime relating to a racially-motivated assault of a 50-year-old Sikh man who works as a taxi cab driver.
Jamie Larson pleaded guilty to one count of violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act that was enacted in October 2009. The indictment alleges that on Oct. 17, 2012, Larson assaulted the victim, who is from India, based upon the victim’s actual and perceived race, color and national origin, which included Middle Eastern and Arab descent. The defendant was arrested at the scene of the attack after a witness called 911.
According to the documents filed in court, the victim was called to drive Larson to an address in Federal Way, Wash. When the taxi arrived at the destination, the driver got out of the taxi and Larson got out and attacked the driver, grabbing his beard, pulling him to the ground, punching and stomping on his head and body. Larson uttered racial slurs and insults about the vicitm’s perceived ancestry during the attack. The victim suffered damage to his back, shoulder and kidney. He was hospitalized for more than a week and has undergone lengthy physical therapy.
“This case is a testament to the Justice Department’s dedication to vigorously investigate and prosecute all racially-motivated attacks,” said Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division. “It is unacceptable that violent acts of hate committed because of someone’s race and ethnicity continue to occur, and the department will continue to use every available tool to identify and prosecute hate crimes whenever and wherever they occur.”
“Acts of hate, such as this one, hurt not only the victim, but tear at our social fabric. They cannot be tolerated in our community,” said U.S. Attorney for the Western Distrcict of Washington Jenny A. Durkan. “The Shepard-Byrd Act is an important tool for holding defendants accountable.”
The charge carries a statutory maximum of 10 years in prison. Sentencing is scheduled in front of U.S. District Judge John C. Coughenour on Nov. 5, 2013.
The Shepard-Byrd law criminalizes acts of physical violence causing bodily injury motivated by any person’s actual or perceived race, color, national origin, religion, sexual orientation, gender, gender identity or disability.
The matter was investigated by the Seattle Division of the FBI. The Federal Way Police Department provided significant support in this prosecution. The case is being prosecuted by Assistant U.S. Attorney Bruce F. Miyake of the U.S. Attorney’s Office for the Western District of Washington and Trial Attorney Nicholas Durham of the U.S. Department of Justice’s Civil Rights Division.
IF YOU HAVE QUESTIONS, PLEASE USE THE CONTACTS IN THE MESSAGE OR CALL THE OFFICE OF PUBLIC AFFAIRS AT 202-514-2007.
Vista Man Charged with Obstructing Murder InvestigationRead the Press Release
Brian Karl Brimager, former boyfriend of United States Citizen Yvonne Baldelli, was indicted by a federal grand jury in San Diego yesterday on charges that he obstructed justice and made false statements to law enforcement in connection with the investigation into Baldelli’s suspected murder in Panama in 2011. Agents with the Federal Bureau of Investigation arrested Brimager without incident this morning at his house in Vista.
The indictment, unsealed today, alleges that Brimager killed Baldelli in late November 2011 and then engaged in an elaborate scheme to cover up his crime. This scheme included destroying evidence, giving false information to law enforcement, and sending a series of emails purportedly from Baldelli making it appear to her friends and family that she was still alive and traveling with another man in Costa Rica.
According to the indictment, in September 2011 the couple moved together from Los Angeles to the archipelago of Bocas del Toro, Panama. They rented a room in a five-unit hostel on Isla Carenero, a small island near Bocas reachable only by boat. The indictment alleges that while in Panama, Baldelli suffered physical abuse at the hands of Brimager resulting in bruising around her eyes and on her arms.
Baldelli was last seen on the evening of November 26, 2011, when she left Carlos’ Steakhouse, a bar and restaurant in Bocas del Toro, with Brimager.
The indictment alleges that after Baldelli’s disappearance, Brimager created a cover story to explain her whereabouts and in the days and months that followed engaged in a series of obstructive acts designed to make that version appear credible. For example, using Baldelli’s laptop, Brimager sent emails to Baldelli’s friends and family from her personal email account, purporting to be from Baldelli, falsely stating that she was in Costa Rica with another man. To “corroborate” this story, Brimager traveled to Bocas Del Toro on November 27, 2011 and withdrew money from Badelli’s bank account at an ATM to make it appear that she was on her way to Costa Rica. Later, on his way back to the United States, Brimager took a two-day layover in Costa Rica. According to the indictment, while in Costa Rica, Brimager made another withdrawal from Baldelli’s bank account at an ATM in order to make it appear that Baldelli was alive and in San Jose.
“Brimager impersonated Baldelli over email in an attempt to trick her friends and family into believing she was still alive, thereby obstructing, influencing and impeding investigation into her disappearance and suspected death,” the indictment said.
In addition to sending fake emails from Baldelli, the indictment charges that Brimager obstructed justice by disposing of physical evidence, including a bloody mattress. The indictment alleges that prior to dumping the mattress in the ocean, Brimager conducted two internet searches on Baldelli’s computer – one for “washing mattress” and a second for “washing mattress blood stain.” The indictment also alleges that Brimager got rid of Baldelli’s personal belongings – including clothing, cosmetics and jewelry – by packing the items into approximately 10 large garbage bags and leaving them on the dock outside the hostel for disposal.
The indictment also charges Brimager with making materially false statements to the FBI during an interview on March 21, 2012. The indictment alleges that Brimager falsely stated to the FBI that Baldelli left Panama for Costa Rica on November 27, 2011. Brimager also claimed that Baldelli took her white Sony VAIO laptop with her when she left Panama, when in fact, the laptop was found in Brimager’s possession on March 21, 2012 – months after Baldelli’s disappearance. The indictment alleges that Brimager also made materially false statements to the FBI regarding the laptop ever being in Panama, Brimager’s plans to return to the United States, and his striking of Baldelli. Brimager also falsely stated, according to the indictment, that he had never accessed Baldelli’s personal email account or sent emails purporting to be from Baldelli.
DEFENDANT Case Number: 13CR2381-JM Brian Karl Brimager SUMMARY OF CHARGESObstruction of Justice, 10 counts - Title 18, United States Code, Section 1512(c)(2)
Maximum Penalties: 20 years imprisonment for each count, a $250,000 fine, 3 years supervised releaseFalse Statement to a Federal Officer, 1 count - Title 18, United States Code, Section 1001
AGENCIES
Maximum Penalties: 5 years imprisonment, a $250,000 fine, 3 years supervised releaseFederal Bureau of Investigation
*An indictment itself is not evidence that the defendant committed the crimes charged. The defendant is presumed innocent until the United States meets its burden of proving guilt beyond a reasonable doubt.
Two Men Sentenced After Pleading Guilty to Drug ChargeRead the Press Release
JAMES SELF, 29, a resident of St. Helena Parish, was sentenced today to 70 months imprisonment and 3 years of supervised release by U. S. District Judge Jane Triche Milazzo after pleading guilty to cocaine and marijuana charges.
SELF pled guilty on November 13, 2012, to one count of conspiracy to distribute and possess with the intent to distribute crack cocaine and marijuana, and one count each of possession with intent to distribute crack cocaine and possession with intent to distribute marijuana.
In a separate case, TULLIE WHITEN, 28, a resident of Clinton, Louisiana, was sentenced today to 53 months imprisonment and 3 years of supervised release by U. S. District Judge Jane Triche Milazzo after pleading guilty to cocaine and marijuana charges, announced U. S. Attorney Dana J. Boente.
WHITEN pled guilty on June 14, 2012, to one count of conspiracy to distribute and possess with the intent to distribute crack cocaine and marijuana and one count each of possession with intent to distribute crack cocaine and possession with intent to distribute marijuana.
The investigations were conducted by Special Agents of the Drug Enforcement Administration. Both cases were prosecuted by Assistant U. S. Attorney Andre’ Jones.
Two Harrisburg-Based U.S. Postal Inspectors Receive Award for Consumer Fraud WorkRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a U.S. Postal Inspector and a Consumer Fraud Analyst were awarded the Federal Trade Commission’s (FTC) Criminal Liaison Unit’s Consumer Shield Award for their dedicated efforts related to the investigation of the MoneyGram fraud case.
Nicholas Alicea and Michael Hartman were presented the Consumer Shield Award today by James Kohm, Associate Director for the FTC’s Division of Enforcement. It is the first time the FTC has presented this award established to recognize extraordinary work by a criminal law enforcement officer in fighting consumer fraud. Both men will be the only recipients of the award this year.
Alicea and Hartman were nominated for the award by United States Attorney Peter J. Smith.
Alicea and Hartman led the long-term investigation that resulted in the settlement with MoneyGram forfeiting $100 million to be used to compensate thousands of victims of mass marketing and consumer fraud schemes perpetrated by MoneyGram agents between 2004 and 2009.
In addition to the $100 million settlement, approximately 25 former MoneyGram agents have been prosecuted by the United States Attorney’s Office for the Middle District of Pennsylvania. Those defendants victimized individuals throughout Central Pennsylvania many of them elderly, from central and northeastern PA, including residents of: York; Mifflinburg; Sugarloaf; Lehighton; Chambersburg; Moosic; Dover; Stroudsburg; Harrisburg; Clark Summit; Jim Thorpe; Lairdsville; Montgomery; Milford; Bloomsburg; Mount Pocono; Palmyra; Tunkhannock; Montandon; State College; St. Clair; Lewisburg; Shenandoah; Montoursville; Wilkes-Barre; Northumberland; and Elizabethville.
The MoneyGram case was prosecuted by the U.S. Department of Justice Trial Attorney Craig Timm of the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS) and Assistant U.S. Attorney Kim Douglas Daniel of the U.S. Attorney’s Office for the Middle District of Pennsylvania. The forfeiture was handled by Acting Assistant Deputy Chief Jeannette Gunderson of AFMLS’ Forfeiture Unit. The case was investigated by the Harrisburg, PA, office of the United States Postal Inspection Service, Philadelphia Division.
U.S. Postal Inspectors and the U.S. Attorney’s Office are continuing the investigation and prosecutions of consumer fraud schemes that use international money transfer services to victimize U.S. Citizens.
Persons who believe they were victims of the fraud scheme should visit http://www.justice.gov/criminal/vns/caseup/ or call 1-877-282-2610 (United States Only) or 317-324-0390 (International) for instructions on how to request compensation.
Two Broward Residents Arrested on Charges of FraudRead the Press Release
Criminal Complaint Charges Individuals with Scheme to Defraud Spanish-Speaking Consumers by Threatening Them with Deportation
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division and Ronald Verrochio, Postal Inspector in Charge, U.S. Postal Inspection Service, Miami Division, announced yesterday that two individuals were arrested on a federal warrant alleging that they operated a series of fraudulent businesses targeting Spanish-speaking consumers. The criminal complaint, charged Daniel Carrasco, 54, and Federico Martin Gioja, 45, both of Miramar, alleging that the pair incorporated, owned, and ran Florida companies that used a phone room in Argentina to extract money from consumers using lies and extortion.
In addition to the criminal complaint, the Justice Department filed a civil case against Carrasco, Gioja, Romina Tasso and their businesses, seeking an injunction to prevent further fraud and an asset freeze to prevent dissipation of funds obtained from consumers.
Carrasco and Gioja made their first appearances in court yesterday.
According to the civil complaint and the affidavit filed in support of the criminal complaint, the case was the result of a referral from Spanish-language television station, Univision. Companies belonging to Carrasco and Gioja are alleged to have falsely claimed an affiliation with Univision and purported to sell products such as vitamins, lotions, medical insurance, and English-language training products. However, according to the documents, the companies frequently did not deliver products ordered by consumers. The companies allegedly did not have many of the products they promised to send to consumers, and so consumers received other products instead.
According to the civil and criminal complaints, after consumers refused delivery of the companies’ shipments, employees of the Argentinian phone room used by Carrasco and Gioja called and falsely threatened the consumers with arrest, deportation, or fines on their gas and electric bills.
Mr. Ferrer stated, “These defendants specifically targeted Spanish-speaking victims, pretending to be affiliated with the Univision television network, to sell their products from their phone room in Argentina. In fact, however, the defendants had absolutely no connection to Univision, and their companies did not deliver the products ordered by consumers. As this case illustrates, the U.S. Attorney’s Office is committed to investigating and prosecuting fraudsters, both domestic and international, whose schemes defraud American consumers.”
“This case demonstrates our commitment to use every tool at our disposal -- including asset freezes, injunctive relief, and criminal prosecution -- against companies that seek to lie, extort, threaten, and defraud Americans,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “Protecting consumers from fraud continues to be a top priority for the Department of Justice.”
“Postal Inspectors will continue to investigate cases involving fraud against consumers and will vigorously pursue those individuals who use the mail in furtherance of their criminal schemes,” said Ronald Verrochio, U.S. Postal Inspector in Charge, Miami Division.
According to the criminal and civil complaints, Carrasco and Gioja routinely changed the names of the companies under which they did business to evade complaints, regulators, and law enforcement. The businesses allegedly were contacted by a variety of state agencies regarding their illicit practices. In emails cited in the affidavit in support of arrest, those working with Carrasco and Gioja referred to companies tainted by complaints as “burnt.” Rather than changing their practices, the defendants allegedly incorporated new companies and started the same illegal practices again.
Mr. Ferrer commended the investigative efforts of the Postal Inspection Service. The civil case is being handled by Trial Attorney Jessica Gunder of the U.S. Department of Justice’s Consumer Protection Branch. The criminal case is being prosecuted by Assistant Director Richard Goldberg with the Consumer Protection Branch.
A criminal complaint is only an accusation and a defendant is presumed innocent until proven guilty beyond a reasonable doubt. A civil complaint contains allegations only and the defendants will have the opportunity to challenge those allegations in court.
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.
Tonawanda Man Sentenced in Child Pornography CaseRead the Press Release
BUFFALO, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Rosan J. Mack, 39, of Tonawanda, N.Y., who was convicted of possession of child pornography, was sentenced to 10 years in prison U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Michael DiGiacomo, who handled the case, stated that Mack's roommate delivered a DVD containing a video of child pornography to the Tonawanda Police along with a note identifying the defendant. After receiving the DVD, detectives were able to establish that the DVD did in fact belong to the defendant.
The sentencing is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Acting Special Agent in Charge Richard M. Frankel and the Tonawanda Police Department, under the direction of Chief Anthony Palombo.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.Toledo Man Sentenced to 15 Years in Prison for Sex Trafficking of MinorsRead the Press Release
A Toledo man was sentenced to 15 years in prison for sex trafficking of children, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Roy Calhoun, 30, guilty to multiple charges last year, including sex trafficking of children, conspiracy to obstruct a sex trafficking investigation and conspiracy to possess with intent to distribute Oxycodone.
“This defendant profited from children in the commercial sex trade,” Dettelbach said. “Our office will continue to pursue human trafficking cases with vigor.”
Calhoun was arrested in 2010 and accused of recruiting females, including minor children, to work as prostitutes between 2007 and 2010. He advertised a minor on craigslist.com on different occasions and drove the minor to Toledo-area hotels, according to court documents.
Calhoun beat and assaulted the females who worked for him and threatened those who left or attempted to quit working as prostitutes, according to court documents.
This case was prosecuted by Assistant United States Attorney James V. Moroney following an investigation by the Northwest Ohio Violent Crimes Against Children Task Force.
The NWOVCACTF includes members of the Federal Bureau of Investigation, Ohio Bureau of Criminal Identification and Investigation, Toledo Police Department, Lima Police Department, Perrysburg Township Police Department, Fulton County Sheriff's Office and the Ottawa County Sheriff's Office.
Three Miami Men Sentenced in Identity Theft Tax Refund Fraud SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Michael J. DePalma, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID), Ronald Verrochio, Inspector in Charge, U.S. Postal Inspection Service (USPIS), and Sergio Velazquez, Chief, Hialeah Police Department, announced that defendants Lineten Belizaire, 22, Earnest Baldwin, 36, and Earl Baldwin, 42 all of Miami, were sentenced today for their participation in a $1.7 million identity theft tax refund fraud scheme. Specifically, U.S. District Judge Cecilia M. Altonaga sentenced Belizaire to 129 months in prison, to be followed by 3 years of supervised release. Defendant Earnest Baldwin was sentenced to 172 months in prison, to be followed by 4 years of supervised release and defendant Earl Baldwin was sentenced to 84 months in prison, followed by 4 years of supervised release. Judge Altonaga ordered that a restitution hearing be held within 90 days.
Lineten Belizaire pled guilty to access device fraud and aggravated identity theft on March 18, 2013. Earnest and Earl Baldwin were convicted at trial on April 10, 2013, on charges of conspiracy to defraud the government, conspiracy to commit access device fraud, access device fraud, and multiple counts of aggravated identity theft. On April 17, 2013 co-defendant Marckell Steward, 21, of Miami, was sentenced to 72 months in prison, to be followed by 3 years of supervised release for his participation in the identity theft tax refund fraud scheme. Steward had previously pled guilty to conspiracy to commit access device fraud and aggravated identity theft.
According to court documents and testimony, Lineten Belizaire, along with co-conspirators Earnest and Earl Baldwin, and Marckell Steward, were involved in an identity theft tax fraud scheme that operated from July 2011 through June 2012. During the course of their fraud scheme, approximately $1.7 million in fraudulent refund claims were submitted to the IRS for payment.
According to documents filed in court, Belizaire conspired with Steward and Earnest and Earl Baldwin on a plan to use stolen personal identification information of others to file fraudulent and unauthorized tax returns claiming refunds on debit cards. Some of the refund claims were filed from Earl Baldwin's residence. According to the factual proffer, Belizaire exchanged text messages with Steward in which the defendants sent and received personal identification information of victims and also sent and received debit card account numbers that were used for receiving victims’ tax refunds.
As stated in trial testimony and evidence, Earnest Baldwin possessed more than 1,000 names, dates of birth, and Social Security numbers and approximately 40 pre-paid debit cards in other people’s names. Among the papers seized were high school report cards with identity information and data from an organization for disabled persons containing identity information. The evidence at trial also showed that Earnest and Earl Baldwin withdrew money from debit cards loaded with fraudulently obtained refunds. According to plea documents, more than 80 fraudulent tax returns using stolen identifications were electronically filed from the IP address belonging to the Belizaire. Defendant Belizaire was also observed on ATM video withdrawing money on multiple occasions from debit cards loaded with fraudulent tax refunds.
Mr. Ferrer commended IRS-CID, USPIS, and the Hialeah Police Department for their work on the case. The case is being prosecuted by Assistant U.S. Attorneys Michael N. Berger and Maurice Johnson.
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.
Suburban Man Sentenced to 10 Years in Federal Prison for Possessing Child PornographyRead the Press Release
CHICAGO — A former suburban man was sentenced today to one month more than the mandatory minimum of 10 years in federal prison for possessing child pornography. The defendant, BRIAN PERRON, 41, formerly of Wood Dale, pleaded guilty in April 2012, admitting then that he had sexually molested two children he was babysitting when he was 19 years old. He faced the 10-year mandatory minimum sentence because of a 2006 state conviction for possessing child pornography, and he was attempting to obtain additional child pornography depicting sexual abuse when he was arrested on the federal charges.
Perron, who has been in federal custody almost four years, was sentenced to 121 months in prison, followed by five years of supervised release, by U.S. District Judge Robert Gettleman. He must serve at least 85 percent of his federal sentence before he is eligible for release and there is no parole in the federal prison system.
Perron was arrested in July 2009 after Homeland Security Investigations agents executed a search warrant at his home and seized an external computer hard drive that contained 97 images and 21 videos depicting child pornography. The search and arrest stemmed from an HSI investigation of a commercial website that advertised and sold videos of children being forced to perform sexual acts with adults.
Perron “not only collected images and videos of child pornography, but he was attempting to purchase a membership to a child pornography library to obtain more material,” the government argued in a sentencing memo.
The sentence was announced today by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, and Gary Hartwig, Special Agent-in-Charge of Homeland Security Investigations in Chicago.
The government was represented by Assistant U.S. Attorney Tony U. Iweagwu, Jr.
Spencer Man Sentenced to Federal Prison for Drug ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine was sentenced June 13, 2013, to ten years in federal prison.
Gabriel Ginger, 26, from Spencer, Iowa, received the prison term after a January 30, 2013, guilty plea to one count of conspiring to distribute methamphetamine.
At the guilty plea, Ginger admitted his involvement in a conspiracy from about 2010 through August 2011 that distributed more than 50 grams of actual (pure) methamphetamine. On July 21, 2011, law enforcement officers executed a search warrant at Ginger’s residence and seized over 10 grams of methamphetamine which Ginger planned to distribute to others.
Ginger was sentenced in Sioux City by United States District Court Judge Donald E. O’Brien. Ginger was sentenced to 120 months’ imprisonment. A special assessment of $100 was imposed. He must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
Ginger is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Department of Narcotics Enforcement, Spencer Police Department, Clay County Sheriff’s Office, Iowa Great Lakes Drug Task Force, and the Iowa Division of Criminal Investigations.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 12-4049.
Sioux Falls Man Sentenced for Possession with Intent to Distribute A Controlled SubstanceRead the Press Release
United States Attorney Brendan V. Johnson announced that a Sioux Falls, South Dakota man convicted of Possession with Intent to Distribute a Controlled Substance was sentenced on June 25, 2013 by U.S. District Judge Roberto A. Lange.
Alexis Salgado, age 40, was sentenced to 37 months of imprisonment; a $1,000 fine; 3 years of supervised release; and a $100 special assessment to the Federal Crime Victims Fund.
Salgado was indicted by a federal grand jury on July 18, 2012 and he pled guilty to the charge on April 9, 2013.
The charge stems from an incident wherein a South Dakota Highway Patrol Trooper came upon a vehicle with its hood up sitting on the side of Highway 44. There was smoke coming from under the hood and the vehicle’s hazard lights were on. The Trooper stopped to provide assistance and encountered three men with the vehicle. During the Trooper’s contact with the men, a pack of Newport cigarettes stuffed with a plastic bag containing 12.8 grams of methamphetamine was found near the air intake by the front left fender of the vehicle. Additionally, trace amounts of marijuana were located inside the head band of a baseball cap located in the back seat, and a glass pipe was found in between the rear seat cushions. A urine sample was obtained from Salgado who tested positive for methamphetamine, amphetamine and marijuana.
The investigation was conducted by the South Dakota Highway Patrol and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Kathryn N. Rich prosecuted the case.
Salgado was immediately turned over to the custody of the U.S. Marshals Service.
Sioux City Sex Offender Sentenced to 18 Years on Child Pornography ChargesRead the Press Release
A man who distributed and received child pornography was sentenced June 26, 2013, to eighteen years in federal prison.
Jeffrey Huygens, age 47, of Sioux City, Iowa, received the sentence after a February 25, 2013, guilty plea to one count of distributing child pornography and one count of receiving child pornography. At the guilty plea, Huygens admitted he knowingly used the Internet to distribute and receive child pornography. Huygens also admitted that, in 1990, in Island County, Washington, he was convicted of Child Molestation in the First Degree.
Huygens was sentenced in Sioux City by United States District Court Judge Donald E. O’Brien. Huygens was sentenced to 216 months’ imprisonment. A special assessment of $200 was imposed, and Huygens must also serve a ten-year term of supervised release. He must comply with all sex offender registration and public notification requirements.This case was prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Iowa Division of Criminal Investigation.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 12-4094.
Sioux City Man Sentenced to 15 Years for Distributing Child PornographyRead the Press Release
A man who distributed child pornography was sentenced June 25, 2013, to fifteen years in federal prison.
Chad Carver, age 28, of Sioux City, Iowa, received the sentence after a February 28, 2013, guilty plea to one count of distributing child pornography. At the guilty plea, Carver admitted he knowingly used the Internet to distribute child pornography.Carver was sentenced in Sioux City by United States District Court Judge Donald E. O’Brien. Carver was sentenced to 180 months’ imprisonment. A special assessment of $100 was imposed, and Carver must also serve a ten-year term of supervised release. He must comply with all sex offender registration and public notification requirements.
This case was prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Iowa Division of Criminal Investigation and the Federal Bureau of Investigation.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 12-4079.
Sinovel Corporation and Three Individuals Charged in Wisconsin with Theft of Amsc Trade SecretsRead the Press Release
A manufacturer and exporter of wind turbines based in the People’s Republic of China, two employees of that manufacturer and a former employee of a subsidiary of AMSC, a United States-based company formerly known as American Superconductor Inc., were charged today with stealing trade secrets from AMSC causing an alleged loss of more than $800 million to the company, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney for the Western District of Wisconsin John W. Vaudreuil.
A federal grand jury in the Western District of Wisconsin returned an indictment charging Sinovel Wind Group Co. Ltd., dba Sinovel Wind Group (USA) Co. Ltd.; Su Liying, 36, the deputy director of Sinovel’s Research and Development Department; Zhao Haichun, 33, a technology manager for Sinovel; and Dejan Karabasevic, 40, a former employee of AMSC Windtec GmbH, a wholly-owned subsidiary of AMSC, with one count each of conspiracy to commit trade secret theft, theft of trade secrets and wire fraud.
“Today, we announce charges against Sinovel and three individuals for stealing proprietary wind turbine technology from AMSC in order to produce their own turbines powered by stolen intellectual property,” said Acting Assistant Attorney General Raman. “This charged IP theft caused significant harm to a domestic company that develops cutting edge technology and employs Americans throughout the country. Stamping out intellectual property theft is a top priority for this administration, and we will continue to work with our IP Task Force partners to ensure that American ingenuity is protected.”
“The allegations in this indictment describe a well-planned attack on an American business by international defendants--nothing short of attempted corporate homicide," said U.S. Attorney Vaudreuil. “The Department of Justice and this office are committed to protecting American commerce and aggressively prosecuting those who seek to steal and use our intellectual property. I commend the efforts of the FBI and their Austrian counterparts in this long-term international investigation, and the assistance provided by the owners and operators of the Massachusetts turbines."
"The Sinovel case is a classic example of the growing insider threat facing our nation's corporations and their intellectual property,” said FBI Executive Assistant Director Richard McFeely. “The FBI will not stand by and watch the hemorrhage of U.S. intellectual property to foreign countries who seek to gain an unfair advantage for their military and their industries. We are actively working with our private sector and government partners to disrupt and impact those who have made it their mission to steal U.S. military and corporate secrets. Since 2008, our economic espionage arrests have doubled; indictments have increased five-fold; and convictions have risen eight-fold.”
Karabasevic headed the automation engineering department at AMSC Windtec in Klagenfurt, Austria. Su and Zhao are Chinese nationals living in China, and Karabasevic is a Serbian national who lived in Austria, but now lives in Serbia.
According to the indictment, AMSC developed and sold software and equipment to regulate the flow of electricity from wind turbines to electrical grids, and it considered the software and equipment to be trade secrets and proprietary information. The software that runs the PM3000, a part of AMSC’s wind turbine electrical control system, was developed in Wisconsin and was stored on a computer in AMSC’s office in Middleton, Wis. The PM3000 worked with other products, including AMSC’s Low Voltage Ride Through (LVRT) software. The LVRT system is designed to keep a wind turbine operational when there is a temporary sag or dip in flow of electricity in the electrical grid.
Sinovel purchased software and equipment from AMSC for the wind turbines that Sinovel manufactured, sold and serviced. According to the indictment, in March 2011, Sinovel owed AMSC more than $100 million for products and services previously delivered and had entered into contracts to purchase more than $700 million in products and services from AMSC in the future.
The indictment alleges that the four defendants conspired to obtain AMSC’s copyrighted information and trade secrets in order to produce wind turbines and to retrofit existing wind turbines with LVRT technology, without having to pay AMSC for previously-delivered products and services, thereby cheating AMSC out of more than $800 million.The indictment alleges that Sinovel, through Su and Zhao, recruited Karabasevic to leave AMSC Windtec and join Sinovel, and to secretly copy intellectual property from the AMSC computer system. The four defendants are charged with stealing the PM3000 source code from AMSC on March 7, 2011, and transmitting it by downloading it from an AMSC computer in Wisconsin to a computer in Klagenfurt.
The indictment alleges that following the theft of AMSC’s intellectual property, Sinovel commissioned several wind turbines in Massachusetts and copied into the turbines software compiled from the software stolen from AMSC. The U.S.-based builders and operators of these Massachusetts turbines have cooperated in this investigation.
If convicted, Sinovel faces a maximum penalty on each count of five years of probation and a fine of twice the gross gain or loss, meaning Sinovel would face a fine for each count charged of up to twice the alleged loss of more than $800 million.
If convicted, Su, Zhao and Karabasevic each face a maximum penalty of five years in prison on the conspiracy charge, 10 years in prison for theft of a trade secret and 20 years in prison for wire fraud.
The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The case is being investigated by the Madison, Milwaukee and Boston offices of the FBI; the FBI Legal Attachés’ Offices in Vienna, Austria and Beijing; the FBI Criminal Investigative Division; the FBI Intellectual Property Rights Unit; the Bundeskriminalamt (Federal Criminal Intelligence Service) and the Bundesministerium Fuer Justiz (Federal Ministry of Justice) in Austria; the Landeskriminalamt - Klagenfurt and the Staatsanwaltschaft - Klagenfurt (Criminal Investigative Police and State Prosecutor's Office – Klagenfurt, Austria); and with the assistance of the Justice Department’s Office of International Affairs. The case is being prosecuted by Assistant U.S. Attorneys Timothy M. O’Shea and Munish Sharda, and Trial Attorney Brian Levine of the Criminal Division’s Computer Crime and Intellectual Property Section.
This case is part of efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force). Attorney General Eric Holder created the IP Task Force, which is led by the Deputy Attorney General, to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. To learn more about the IP Task Force, go to: www.justice.gov/dag/iptaskforce.
Shelton Man Sentenced to 30 Months in Federal Prison for Trading Child Pornography on the InternetRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that ARTHUR GALLOWAY, 38, of Shelton, was sentenced today by United States District Judge Janet Bond Arterton in New Haven to 30 months of imprisonment, followed by 10 years of supervised release, for trading child pornography on the Internet.
According to court documents and statement made in court, on March 14, 2012, the Connecticut State Police Computer Crimes Unit, Shelton Police Department and Federal Bureau of Investigation conducted a court-authorized search of GALLOWAY’s residence and seized a laptop computer, an external hard drive and other items. Investigators determined that GALLOWAY used the Internet to trade numerous images and video of child pornography, and he was arrested at that time.
Subsequent forensic analysis of the seized items revealed that GALLOWAY possessed 11 printed photographs, 913 images and 45 videos of children engaging in sexually explicit conduct. Some of the videos exceeded 20 minutes in length.
On January 11, 2013, GALLOWAY pleaded guilty to one count of receipt and distribution of child pornography.
This matter was investigated by the Connecticut State Police Computer Crimes Unit, the Shelton Police Department, the Federal Bureau of Investigation and the Connecticut Child Exploitation Task Force, which includes federal, state and local law enforcement agencies. The case was prosecuted by Assistant United States Attorneys Felice M. Duffy and Neeraj N. Patel.
The Connecticut Child Exploitation Task Force, which is housed at the main FBI office in New Haven, investigates crimes against children occurring over the Internet, and provides computer forensic review services for participating agencies. For more information about the Task Force, or to report child exploitation crimes, please contact the FBI at 203-777-6311.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
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(203) 821-3722 [email protected]Serial Bank Robber Sentenced to 15 Years in PrisonRead the Press Release
PHILADELPHIA - Aaron Thomas, 47, of Philadelphia, was sentenced today to 15 years in prison for committing six bank robberies. On March 14, 2013, Thomas pleaded guilty to robbing six banks: (1) PNC Bank located on Old York Road in Abington on August 10, 2012; (2) TD Bank located on City Avenue in Philadelphia, on August 8, 2012; (3) TD Bank located on City Avenue in Philadelphia on May 17, 2011; (4) TD Bank located on Moreland Road in Abington, on September 17, 2009; (5) TD Bank located on Grant Avenue in Philadelphia, on September 17, 2009; and (6) TD Bank located on Old York Road in Abington on July 24, 2009. Thomas was apprehended by Abington Police following the PNC Bank robbery on August 10, 2012 after a vehicle and foot pursuit through the streets of Abington and Philadelphia which resulted in two police officers being injured and several vehicles damaged. Thomas has two prior convictions for bank robbery.
In addition to the prison term, U.S. District Court Judge Lawrence F. Stengel ordered Thomas to pay $30,905 in restitution, a $600 special assessment, and ordered three years of supervised release.
The case was investigated by Federal Bureau of Investigation, the Abington Township Police Department, and the Philadelphia Police Department. It was prosecuted by Assistant United States Attorney Robert J. Livermore.
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