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24 June 2013
St. Johns County Man Sentenced to More Than 15 Years in Prison in Methamphetamine CaseRead the Press Release
Jacksonville, FL - U.S. District Judge Marcia Morales Howard today sentenced Frank Higginbotham (36, Hastings, Florida) to 15 years and 10 months in federal prison for conspiracy to manufacture methamphetamine and distribution of methamphetamine. The court also ordered Higginbotham to serve 8 years of supervised release after his from prison. A jury found Higginbotham guilty of the offenses on February 21, 2013.
According to court documents, Higginbotham manufactured and sold methamphetamine at various locations in St. Johns County. During the conspiracy, methamphetamine users gave Higginbotham boxes of medication containing pseudoephedrine in exchange for methamphetamine. Pseudoephedrine, which is an ingredient in many cold and allergy medications, is the primary ingredient needed to manufacture methamphetamine. On February 13, 2012, Higginbotham sold methamphetamine to an undercover Drug Enforcement Administration (DEA) agent. Higginbotham had previously served three years in state prison for trafficking in methamphetamine.
This case was investigated by the Drug Enforcement Administration and the St. Johns County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Arnold B. Corsmeier.
Six Shelby County Residents Guilty of Federal Gun/Drug ViolationsRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – Six Center, Texas residents have pleaded guilty to gun and drug violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today. The plea hearings were held today before U.S. Magistrate Judge Keith F. Giblin.
Lakeva Shillette Hill, a/k/a Sugar Momma, 35, pleaded guilty to conspiracy to possess with intent to distribute a controlled substance and being a felon in possession of a firearm. Hill faces up to 10 years in federal prison.
Lester Earl Pitts, 48, pleaded guilty to providing a firearm to a drug trafficker and providing a firearm to a felon. Hill faces up to 10 years in federal prison.
Vincent Jermaine Lathan, a/k/a Reed Cartwright, 36, pleaded guilty to conspiracy to possess with intent to distribute a controlled substance. Lathan faces up to 20 years in federal prison.
Cornelius Vansharles Gray, 36, pleaded guilty to conspiracy to possess with intent to distribute a controlled substance. Gray faces up to five years in federal prison.
Anthony Gene Chumbley, 46, pleaded guilty to being a felon in possession of a firearm. Chumbley faces up to 10 years in federal prison.
Andrae Demarkqudell Pegues, a/k/a Mark, 33, pleaded guilty to making a false statement to the ATF. Pegues faces up to five years in federal prison.
According to information presented in court, from February 2011 to January 2013, Pitts was a certified peace officer employed as a deputy for the Shelby County Sheriff’s Office. During that time, Pitts associated with Hill, Pegues, Chumbley, and Gray.
In May 2010, Pitts purchased a 9mm semi-automatic pistol which he provided to Pegues even though he knew Pegues was a convicted felon having been convicted of a drug trafficking charge in the Eastern District of Texas in 2000. Convicted felons are prohibited from owning or possessing firearms or ammunition.
On May 9, 2010, Pegues was arrested in possession of the firearm. The next day, Pitts filed a false burglary report with the Shelby County Sheriff’s Office, stating that the firearm had been stolen from his vehicle. Pitts instructed Pegues to conceal from law enforcement that Pitts had provided the firearm to Pegues. On June 4, 2010, Pegues lied to the ATF about how he obtained the firearm.
On Feb. 26, 2012, Pitts purchased a semi-automatic pistol for Hill although he knew Hill was actively committing drug trafficking crimes and was a convicted felon having been found guilty of distribution of cocaine in Louisiana in 1998.
On July 1, 2012, Pitts provided a .40 caliber semiautomatic pistol to Gray although he knew Gray was actively committing drug trafficking crimes.
On Dec. 31, 2012, Pitts loaned a shotgun to Chumbley, knowing that Chumbley was a convicted felon. Chumbley was convicted of delivery of a controlled substance in Cherokee County, Texas, in 1993; and delivery of a controlled substance in Cherokee County, Texas, in 1990.
The defendants were indicted by a federal grand jury on Apr. 17, 2013 and arrested on Apr. 18, 2013. Sentencing dates have not been set.This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Texas Department of Public Safety, the Center Police Department, and the Shelby County Sheriff’s Office and prosecuted by Assistant U.S. Attorney John B. Ross.
Sarcoxie Man Sentenced for Illegal Financial Transactions in Scheme to Sell Cooking Oil Stolen from RestaurantsRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Sarcoxie, Mo., man has been sentenced in federal court for structuring financial transactions in order to evade federal reporting requirements as part of a scheme to sell stolen cooking oil that was intended for recycling.
Jesse Arnold, 46, of Sarcoxie, was sentenced by U.S. District Judge Dean Whipple on Friday, June 21, 2013 to one year and one day in federal prison without parole. Arnold must also forfeit to the government $207,817 that was seized from his business bank account.
Arnold, who pleaded guilty on Dec. 18, 2012, operated 4 States Grease Company, a collection facility for spent cooking oil, located in Sarcoxie. Spent cooking oil is the byproduct of either vegetable or animal fat oil used by restaurants. The oil can be repurposed for use as biodegradable diesel fuel and animal food products, and therefore has value in the open market. Because of this value, restaurants will contract with companies to sell their spent cooking oil and allow the companies to take it and recycle it.
Arnold directed 4 States from 2009 to November 2011. He admitted that he had reason to believe he was buying spent cooking oil that had been stolen by various drivers. These drivers obtained the stolen cooking oil from businesses in Missouri, Kansas, Oklahoma, and Arkansas. The drivers sold the spent cooking oil to Arnold under circumstances that would have caused a reasonable person to know that it had been stolen. Arnold and 4 States then sold the spent cooking oil to Brooks Grease Service, and had it transported to Brooks’s factory in Tulsa for processing.
During this time, in order to avoid federal reporting requirements that could bring unwanted scrutiny to 4 States, Arnold deliberately and knowingly structured withdrawals from his business checking account. Arnold withdrew some or most of the money in order to purchase the stolen spent cooking oil. Arnold made numerous withdrawals on consecutive days that were individually less than $10,000, but which totaled more than $10,000 when added together.
Under federal law, banks must file a currency transaction report for any financial transaction over $10,000. The crime of structuring occurs when a person, in order to knowingly avoid the financial institution from filing a currency transaction report, breaks up the transaction into smaller components that are less than $10,000.
All of the cash withdrawals from Jan. 1, 2009, to Sept. 30, 2011, were done by checks written to “Cash” and signed by Arnold. Many of the cash withdrawals were done on successive banking days and were for $9,000 for each withdrawal. There were no single cash withdrawals over $10,000. The parties have stipulated that the most readily provable amount that Arnold was responsible for structuring was $243,000.
This case was prosecuted by Assistant U.S. Attorney Randall D. Eggert. It was investigated by IRS-Criminal Investigations, the Kansas City, Mo., Police Department, the Missouri State Highway Patrol the Crawford County, Kan., Sheriff’s Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.Rosebud Man Sentenced for Third Degree Burglary and Aiding and AbettingRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota man convicted of Third Degree Burglary and Aiding and Abetting was sentenced on June 24, 2013 by U.S. District Judge Roberto A. Lange.
Justin Lee Gabriel, age 21, was sentenced to 21 months in custody, 2 years of supervised release, $2,600 in restitution, and $100 to the Federal Crime Victims Fund.
Gabriel was indicted by a federal grand jury on December 11, 2012 and pled guilty to the charge on February 6, 2013.
The conviction stems from an incident that took place on September 6, 2012, when Gabriel broke in to the Prairie Hills Square golf course and took U.S. currency from the business.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Gabriel was remanded to the custody of the U.S. Marshals.
Rosebud Man Sentenced for Interstate Transportation of A Stolen Motor VehicleRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota man convicted of Interstate Transportation of a Stolen Motor Vehicle was sentenced on June 24, 2013 by U.S. District Judge Roberto A. Lange.
Alec Arapahoe, age 20, was sentenced to 9 months in custody, 18 months of supervised release, $6,419.48 in restitution, and $100 to the Federal Crime Victims Fund.
Arapahoe was indicted by a federal grand jury on August 22, 2011 and pled guilty to the charge on April 2, 2013.
The conviction stems from an incident that took place on July 3, 2011, when Arapahoe stole a pickup truck from Colorado and drove the vehicle from Colorado to South Dakota and onto the Rosebud Sioux Indian Reservation.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Arapahoe was remanded to the custody of the U.S. Marshals.
Rosebud Man Sentenced for Assaulting A Tribal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota man convicted of Assault on a Federal Officer was sentenced on June 21, 2013 by Chief Judge Jeffrey L. Viken, United States District Court.
Jess Raymond Young, age 36, was sentenced to 30 months’ imprisonment, 2 years’ supervised release, and ordered to pay $100 to the Federal Crime Victims Fund.
On November 21, 2012, while in custody at the Oglala Sioux Tribal Jail in Pine Ridge, Young shoved a correctional officer against the wall and bit her multiple times. He pled guilty on March 21, 2013.
This case was investigated by the Bureau of Indian Affairs Office of Justice Services and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Sarah B. Collins prosecuted the case.
Rosebud Man Sentenced for Assaulting A Tribal OfficerRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota man convicted of Assault on a Federal Officer was sentenced on June 21, 2013 by Chief Judge Jeffrey L. Viken, United States District Court.
Jess Raymond Young, age 36, was sentenced to 30 months’ imprisonment, 2 years’ supervised release, and ordered to pay $100 to the Federal Crime Victims Fund.
On November 21, 2012, while in custody at the Oglala Sioux Tribal Jail in Pine Ridge, Young shoved a correctional officer against the wall and bit her multiple times. He pled guilty on March 21, 2013.
This case was investigated by the Bureau of Indian Affairs Office of Justice Services and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Sarah B. Collins prosecuted the case.
Rosebud Man Sentenced for Assault with A Dangerous WeaponRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota man convicted of Assault with a Dangerous Weapon was sentenced on June 24, 2013 by U.S. District Judge Roberto A. Lange.
Mitchell Stoneman, age 22, was sentenced to 36 months in custody, 2 years of supervised release, $4,445 in restitution, and $100 to the Federal Crime Victims Fund.
Stoneman was indicted by a federal grand jury on November 15, 2013 and pled guilty to the charge on April 8, 2013.
The conviction stems from an incident that took place on October 11, 2012, when Stoneman assaulted the victim with a bat and rock, with intent to do bodily harm to the victim.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case was prosecuted by Assistant U.S. Attorney Tim Maher.
Stoneman was remanded to the custody of the U.S. Marshals.
Roseau Man Sentenced for Operating a Continuing Criminal Enterprise in Operation ‘Noah’s Ark’Read the Press Release
FARGO – First Assistant U.S. Attorney Lynn Jordheim announced that Noah Bergland of Roseau, Minn. was sentenced before U.S. District Judge Ralph R. Erickson on June 24, 2013, to charges of operating a continuing criminal enterprise and money laundering conspiracy. Bergland pleaded guilty to the charges on July 10, 2012.
Judge Erickson sentenced Bergland to 10 years’ imprisonment to be followed by three years of supervised release. Bergland was ordered to pay a $200 special assessment to the Crime Victim’s Fund and to forfeit $250,000 to the United States.
Operation Noah’s Ark was an Organized Crime Drug Enforcement Task Force (OCDETF) investigation that revealed an organization that brought cocaine, heroin, marijuana and ecstasy from the Twin Cities to various cities in North Dakota and Minnesota.
The areas of North Dakota where the organization distributed these drugs were Fargo, Grand Forks and Williston. The cities in Minnesota included Minneapolis, St. Paul, Alexandria, Thief River Falls and East Grand Forks. To date, there have been 30 defendants charged as part of this investigation on drug conspiracy and money laundering charges. Additional defendants that have been sentenced in this case include:
Brian Warren Briggs - Grand Forks, ND – Conspiracy to Distribute Controlled Substances and Money Laundering Conspiracy – 180 months (15 years) Anthony Ancona – Albuquerque, NM - Conspiracy to Distribute Controlled Substances – 120 months (10 years) Nicholas William Michael – Grand Forks, ND - Conspiracy to Distribute Controlled Substances – 96 months (8 years) Jacob Brian Skadsem – Fargo, ND - Conspiracy to Distribute Controlled Substances and Money Laundering Conspiracy – 74 months (6 years, 2 months) Vary Rattanasithy – Blaine, MN – Conspiracy to Distribute Controlled Substances and Money Laundering Conspiracy– 72 months (6 years) Andrew Michael Luehring – Fargo, ND - Conspiracy to Distribute Controlled Substances – 70 months (5 years, 10 months) Riley Kevin Wald – Fargo, ND – Conspiracy to Distribute Controlled Substances - 60 months Andrew Frank Przekwas – Roseau, MN - Conspiracy to Distribute Controlled Substances and Money Laundering Conspiracy – 48 months (4 years) Peter Philip Basting – Grand Forks, ND - Conspiracy to Distribute Controlled Substances – 48 months (4 years) Beau Ed Vasas – Spooner, WI - Conspiracy to Distribute Controlled Substances – 46 months (3 years, 8 months) Rachel Renee Dahl – Roseau, MN - Conspiracy to Distribute Controlled Substances – 36 months (3 years) Bryan Keith Cameron – Detroit Lakes, MN - Conspiracy to Distribute Controlled Substances and Money Laundering Conspiracy– 30 months (2 years, 6 months) James Robert Nord – Fargo, ND - Conspiracy to Distribute Controlled Substances (30 months (2 years, 6 months) Joel Garcia – Minneapolis, MN - Conspiracy to Distribute Controlled Substances – 30 months (2 years, 6 months) Chad Thomas Whitney – Grand Forks, ND - Conspiracy to Distribute Controlled Substances – 30 months (2 years, 6 months) Tony Joe Galle – East Grand Forks, MN - Conspiracy to Distribute Controlled
Substances – 27 months (2 years, 6 months) Kevin Ryan Magnuson – Fargo, ND - Conspiracy to Distribute Controlled Substances – 20 months (1 year, 8 months) Jamie Beth Johnston – Robbinsdale, MN - Conspiracy to Distribute Controlled Substances – 18 months (1 year, 6 months) Christopher Lee Webb – Burnsville, MN - Conspiracy to Distribute Controlled Substances – 15 months (1 year, 3 months) Alexandra Evelius – Minneapolis, MN – Conspiracy to Distribute Controlled Substances – 6 months and supervised release for 3 years Andrew Richard Block – Grand Forks, ND - Conspiracy to Distribute Controlled Substances – 6 months and 3 years of supervised probation Tara Lynn Lawrence – Minneapolis, MN – Conspiracy to Distribute Controlled Substances – 12 months electronic home monitoring with 3 years of supervised probation Clinton James Rooney – St. Paul, MN - Conspiracy to Distribute Controlled Substances – supervised probation for 3 years Timothy Michael Ploen – Edina, MN - Conspiracy to Distribute Controlled Substances – 6 months half-way house and supervised probation for 3 years Grant Kristjan Thorfinnson – Grand Forks, ND - Conspiracy to Distribute Controlled Substances – supervised probation for 2 years Additional defendants that have pleaded guilty for their role in the drug conspiracy and await sentencing are: Adam Wayne Nehk – Moorhead, MN – sentencing scheduled for July 18, 2013 Showin Keon Davis – Golden Valley, MN – sentencing scheduled for July 29, 2013 Markie Ann Plutowski – Grand Forks, MN – sentencing scheduled for July 29, 2013 Justin Michael Aaberg – Alexandria, MN – sentencing scheduled for September 23, 2013Operation Noah’s Ark was an investigation lead by Homeland Security Investigations (HIS), Internal Revenue Service-Criminal Investigation (IRS-CI), North Dakota Bureau of Criminal Investigations and the Grand Forks Police Department. Assisting agencies are the Drug Enforcement Administration (DEA) – Fargo Resident Office, Minnesota Bureau of Criminal Apprehension, and North Dakota Parole and Probation.
"This investigation is a terrific example of how federal, state and local law enforcement were able to work closely together to successfully dismantle a major narcotics smuggling organization," said Michael Feinberg, special agent in charge of HSI St. Paul, which covers North Dakota. "HSI will continue to utilize its broad authorities to target those individuals that pose direct threats to our communities."
“The role of Internal Revenue Service Criminal Investigation in narcotics investigations is to follow the money so we can financially disrupt and dismantle major drug trafficking organizations such as Operation Noah’s Ark. Today's sentencing of Noah Bergland and previously sentenced co-conspirators again emphasizes that the IRS-CI and the U.S. Attorney’s office will continue their aggressive pursuit of those who launder illegal drug profits,” said Kelly R. Jackson, IRS-CI, Special Agent in Charge, St. Paul Field Office. “IRS-CI is committed to unraveling complex financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money.”
Assistant U.S. Attorney Chris Myers prosecuted the cases.
Rogue River Man Sentenced to 25 Years in Federal Prison for Sexually Abusing MinorsRead the Press Release
Rogue River Man with Prior Conviction for Sex Crime, Sentenced for Transporting Two Minor Girls to California and Committing Sexual AssaultMEDFORD, Ore. – Today, Senior U.S. District Judge Owen M. Panner sentenced James Robert Powell, 50, of Rogue River, Oregon, to 25 years in federal prison for crimes relating to his sexual assault of two minors.
After receiving allegations that Powell had molested minors, law enforcement officials learned that Powell used his friendship with a woman to obtain her permission in March 2012 to take her two daughters, ages 15 and 13, from Rogue River, Oregon to Brookings, Oregon, purportedly to help Powell sell merchandise at a local fair. The investigation disclosed that Powell instead took the girls to a beach house he had rented in Smith River, California. Once there, Powell provided alcohol to the minors, got them drunk, and sexually abused both of them over a two day period. Powell also secretly recorded the girls while they were naked. He instructed the girls that upon their return, to lie to their mother about where they had been over the weekend.
On June 29, 2012, a federal grand jury returned an indictment against Powell, charging him with various offenses relating to his sexual assault of the minors. Powell pleaded guilty on January 22, 2013 to transportation with intent to engage in criminal sexual activity with a minor, and using a minor to produce a visual depiction of sexually explicit conduct. Powell has been in federal custody since he was arrested in April 2012.
Powell has a prior conviction in 1994 for assault with intent to commit rape and verbal threats to kill (U.S. Department of the Army, Fort Leavenworth, KS). Powell served five years in a military prison and received a General Court Martial.
Today, Senior U.S. District Judge Owen Panner sentenced Powell to serve 25 years in federal prison, and ordered that Powell be on supervised release for the rest of his life. U.S. Attorney Amanda Marshall applauded Judge Panner’s sentence, commenting that, “This 25-year sentence sends a clear message to other sex offenders like Powell. If you sexually abuse a child, we will find you, we will prosecute you, and you will be locked up for a very long time. We will continue to do everything in our power to remove these predators from society and prevent them from victimizing others.”
This case was investigated by the FBI, Grants Pass Police Department, and Southern Oregon High-Tech Crimes Task Force, and was prosecuted by Assistant U. S. Attorney Judith Harper.
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."
Rochester Man Sentenced for Stealing Interstate Shipment from RailcarRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Anthony Toscano, 48, of Rochester, N.Y., who was convicted of conspiracy to steal an interstate shipment and theft of an interstate shipment, was sentenced to 18 months in prison and ordered to pay $4,669.26 in restitution by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Brett A. Harvey, who handled the case, stated that on June 30, 2009, Toscano, along with co-conspirators Richard E. Riedman, Anthony Russell and Timothy Stone, stole more than 16 gross tons of scrap steel from a railcar at a CSXT rail yard in Batavia, N.Y. The defendants used a logging truck to remove 17 gross-ton bales of processed, high-grade scrap steel from the railcar.
Toscano and the other defendants were apprehended by members of the Genesee County Sheriff's Office in the logging truck and a pick-up truck as they left the scene of the theft. The bales were in the process of being shipped to a steel mill in Pennsylvania when they were stolen. Toscano, Riedman, Russell, and Stone were convicted after a two-week jury trial before Judge Siragusa in September 2012.
Defendants Stone and Russell will be sentenced by Judge Siragusa on July 9, 2013, and July 31, 2013, respectively. Riedman is scheduled to be sentenced by Judge Siragusa on September 16, 2013.
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 Genesee County Sheriff's Department, under the direction of Gary Maha.Rice County Woman Pleads Guilty in Cattle FraudRead the Press Release
WICHITA, KAN. – A Rice County woman has pleaded guilty in connection with a cattle fraud scheme, U.S. Attorney Barry Grissom said today.
Carrie L. Frederick, 37, Sterling, Kan., pleaded guilty to three counts of wire fraud. In her plea, she admitted she embezzled money while she worked for Sellers Farms, Inc., a livestock feeding operation in Lyons, Kan. She caused money to be sent from Sellers Farms’ accounts to Golden Belt Feeders, Inc., of St. John, Kan., to pay debts she owed from trading cattle when she worked for Golden Belt. There were three transactions of embezzled funds totaling more than $211,000.
Sentencing is set for Sept. 11. She faces a maximum penalty of 30 years in federal prison and a fine up to $1 million on each count. Grissom commended the FBI and Assistant U.S. Attorney Lanny Welch for their work on the case.
Rapper Fat Joe Sentenced to Four Months in Prison for Failing to File Income Tax Returns on over $3.3 in Taxable IncomeRead the Press Release
NEWARK, N.J. – Joseph Cartagena, the rapper popularly known as “Fat Joe,” was sentenced to four months in prison for failing to file tax returns with the IRS, U.S. Attorney Paul J. Fishman announced.
Cartagena, 42, of Miami Beach, Fla., previously pleaded guilty before U.S. Magistrate Judge Cathy L. Waldor to Counts One and Two of a four-count information charging him with failing to file a tax return for tax years 2007 to 2010. Those two counts correlate to tax years 2007 and 2008. Under the terms of the plea agreement, however, the tax loss for all four years, including 2009 and 2010, was taken into account for sentencing.
According to documents filed in this case and statements made in court:Cartagena received income for his musical performances as well as royalties on the sales of his music. These monies came from three different sources: Terror Squad Production Inc. (Terror Squad), Miramar Music Touring Inc. (Miramar), and FJTS Corp. Cartagena owned Terror Squad and Miramar, both of which are corporations based in Somerville, N.J.
Cartagena admitted he received gross income in excess of $1.18 million in 2007, in excess of $1.28 million in 2008, in excess of $265,000 in 2009, and in excess of $630,000 in 2010. The total tax loss to the government was $718,038.
In addition to the prison term, Judge Waldor sentenced Cartagena to one year of supervised release and fined him $15,000. He must report by Aug. 26, 2013, to begin serving his sentence.
U.S. Attorney Fishman credited special agents with IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen, with the investigation leading to today’s sentence.
The case is being prosecuted by Assistant U.S. Attorney Joseph Mack of the U.S. Attorney’s Healthcare and Government Fraud Unit.
12-266Defense counsel: Jeffrey Lichtman Esq., New York
RAM Guilty PleaRead the Press Release
BATON ROUGE, LA - United States Attorney Donald J. Cazayoux, Jr. announced today the felony convictions of a wastewater brokerage firm and its two owners in connection with a wide ranging and ongoing federal and state investigation into corruption and fraud surrounding federal environmental laws.
RAM ENVIRONMENTAL SERVICES, INC., an entity incorporated in the State of Louisiana and doing business in Morgan City, Louisiana; RAYMOND MARCEL, JR., age 60, of Berwick, Louisiana; and CYRIL D. ROBICHEAUX, age 53, of Morgan City, Louisiana, each pleaded guilty today before U.S. District Judge James J. Brady to Bills of Information charging them with a conspiracy to defraud the U.S. Environmental Protection Agency and to violate the Safe Drinking Water Act.
As a result of their guilty pleas, MARCEL and ROBICHEAUX each face up to five years imprisonment, a $250,000 fine, a term of supervised release following imprisonment up to three years, and restitution. As part of its plea agreement, RAM has agreed to be sentenced to a three year term of probation, a $50,000 fine, and restitution as determined by the Court.
During today’s hearings, the defendants admitted that, in 2011 and 2012, they conspired with themselves and others to illegally discharge industrial wastewater at locations in Belle River, Louisiana, and Baton Rouge, Louisiana, and to otherwise obstruct the enforcement of the federal environmental laws through kickbacks, the creation and use of false documents, and other fraudulent means.
With regard to the Baton Rouge conduct, the defendants admitted that, in September 2012, they and others caused the illegal disposal of industrial wastewater at a site in Baton Rouge, Louisiana, and concealed such activity through the creation and use of false documents. The defendants admitted further that they undertook such fraudulent activity with the owner of the Baton Rouge site and further schemed with the site owner to lie to investigators regarding the disposals.
With regard to the Belle River conduct, the defendants admitted that, during 2011 and 2012, they paid over $22,000 in kickbacks to Michael J. Vaughn, the Operations Manager of FAS Environmental Services, a transportation and disposal company, in exchange for illegally using FAS’s injection well in Belle River to dispose of over 380,000 gallons of industrial wastewater. As part of the scheme, the defendants admitted that they and their fellow conspirators created and used over 100 false documents, including manifests and work orders, in addition to submitting false reports to regulators in Baton Rouge. Such false and fraudulent documents were designed to conceal the scheme from federal and state government officials, as well as the defendants’ unsuspecting clients.
U.S. Attorney Cazayoux stated, “Today’s convictions mark a continuation of this office’s long track record of holding to account those who violate federal criminal environmental laws. Our area is blessed to have a robust and largely law-abiding industrial presence. Unfortunately, there are some who seek economic benefit by refusing to adhere to federal environmental and safety laws. The people of this district can be assured that this office, together with our federal, state, and local partners, will continue to aggressively pursue such violators.”
“One of EPA’s primary missions is to ensure that federal laws protecting human health and the environment are enforced fairly and effectively,” said Ivan Vikin, Special Agent-in-Charge of EPA’s criminal enforcement program in Louisiana. “Violators who cause the submission of false information undermine the government’s efforts to protect the public and the environment. These illegal actions cannot and will not be tolerated. EPA and its partner agencies will vigorously pursue those who place the public at potential risk.”
“This case should serve notice that DEQ and its partners will continue to aggressively prosecute any company or individual who chooses to skirt state and federal regulations by avoiding the costs of handling, treating or disposing wastewater properly and legally,” said DEQ Secretary Peggy Hatch. “DEQ is proud of the collaborative work undertaken by the investigators to halt these illegal practices and bring the perpetrators to justice.”
Today’s charges were preceded by Vaughn, the former FAS Operations Manager, pleading guilty on May 29, 2013, to a Bill of Information charging him with conspiracy to defraud the U.S. Environmental Protection Agency and to violate the Safe Drinking Water Act, in violation of Title 18, United States Code, Section 371, making false statements within the jurisdiction of the federal government, in violation of Title 18, United States Code, Section 1001, and forfeiture. FAS ownership was unaware of the scheme involving the FAS injection well, which resulted in the misuse of FAS resources. FAS has cooperated fully throughout the investigation.
The sentencing dates for RAM, MARCEL, ROBICHEAUX, and Vaughn have not yet been set.
This ongoing investigation is being conducted by this office, the Criminal Investigation Division of the U.S. Environmental Protection Agency, and the Criminal Investigation Division of the Louisiana Department of Environmental Quality. The case is being prosecuted by Assistant United States Attorney Corey R. Amundson who serves as the Senior Deputy Chief of the Criminal Division.
Plummer Man Sentenced for Aiding Transportation of Stolen GoodsRead the Press Release
Ordered to Pay More Than $581,000 in Restitution to Stimson Lumber
COEUR D’ALENE – Trevor Mokry, 33, of Plummer, Idaho, was sentenced today in United States District Court in Coeur d’Alene for aiding the transportation of stolen goods, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Edward J. Lodge sentenced Mokry to 18 months in federal prison and three years of supervised release. He was also ordered to pay $581,445.24 in restitution to the victim. He pleaded guilty to the charge on April 23, 2012.
According to court records, between June 2007 and June 2011, Mokry aided and abetted the unlawful transportation of stolen lumber while employed by Stimson Lumber Company of Plummer. According to the plea agreement, Mokry worked in the lumber yard and was responsible for loading and unloading trucks. He admitted that he entered into an unauthorized “mill direct” sales arrangement with a business located in Spokane, Washington, which involved the business' driver traveling from Spokane to Plummer to pick up lumber and then returning to Spokane. Mokry loaded the truck and received a check from the driver for the lumber. According to the plea agreement, Mokry sold Stimson's lumber to the Spokane business without the Stimson Lumber’s permission or knowledge and never paid Stimson for the lumber. Mokry admitted that he was paid $581,445.24 for the lumber.
The case was investigated by the Federal Bureau of Investigation.
Phoenix Man Sentenced to over 3 Years in Prison for Stalking A Woman in MarylandRead the Press Release
Baltimore, Maryland - U.S. District Judge Ellen L. Hollander sentenced David Charles Richards, age 49, of Phoenix, Arizona, today to 42 months in prison, followed by three years of supervised release, for stalking a woman in Maryland. As part of his sentence, Judge Hollander ordered that Richards have no contact with the victim or her family.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
“David Charles Richards violated the federal law against stalking, by using the internet to engage in a course of conduct that was intended to and did place a person in reasonable fear of death or serious bodily injury,” said U.S. Attorney Rod J. Rosenstein.
According to Richards’ guilty plea, from December 2006 through November 2011, Richards used the internet, telephone, electronic mail and the U.S. mail to stalk a woman in Maryland, including threatening to kill the woman. Richards and the woman had a prior romantic relationship, which the woman described as both troubled and violent.
According to Richards’ plea agreement, after not having any contact with the victim for almost 15 years, in June 2006, Richards contacted the victim’s sister telling her that he still loved the victim but wanted to hurt her. Beginning in July 2006, and during each subsequent year, the victim sought and was granted protective orders forbidding Richards to contact her. On December 11, 2006, the victim discovered that a website had been created in her name, which included a countdown clock to the expiration of the protective order the victim had taken out against Richards and other threatening material. In March of 2008, Richards attempted to purchase a firearm in Arizona, but failed to disclose that he was subject to a protective order. He was denied purchase of a firearm by ATF due to his prohibited person status. In December 2009, Richards mailed a threatening note, along with torn and shredded pieces of the protective orders that had been served upon him, to the victim’s home. Through January 2010, Richards left the victim at least eight voicemails totaling one hour and 40 minutes in length. Richards continued to post threats on websites directed at the victim, including as recently as November 2011. Richards’ long campaign of harassment and threats placed the victim in fear of death and serious harm.
United States Attorney Rod J. Rosenstein praised the FBI agents in Baltimore and Phoenix for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Rachel M. Yasser and Kristi N. O’Malley, who prosecuted the case.
Owner of Medical Supply Company Sentenced to Prison for His Role in Million-dollar Power Wheelchair ScamsRead the Press Release
United States Attorney Laura E. Duffy announced that Jose Melendez, the owner and operator of Oceanside Medical Services, was sentenced to 18 months in prison today for his involvement in a health care fraud conspiracy that resulted in over $1 million in false claims to the Medicare trust fund. Melendez was also ordered to pay $593,429.81 in restitution, and will be on supervised release for three years after completing his custodial sentence.
The scheme involved the sale of fraudulent power wheelchair prescriptions in order to fraudulently obtain Medicare reimbursement for power wheelchairs that patients did not need and, in some cases, did not want. Two of Melendez’s co-conspirators, Dr. Irving Schwartz and Gloria Hernandez, traveled to El Centro, California in search of elderly Medicare patients. Dr. Schwartz wrote fraudulent prescriptions for the patients to obtain power wheelchairs, even though the patients did not need the equipment and could walk without assistance, and collected a $300 cash kickback in exchange for each power wheelchair prescription. Hernandez then sold the fraudulent power wheelchair prescriptions to Melendez, charging him $1,000 per fraudulent prescription.
Melendez, in turn, sold some of the power wheelchair prescriptions to other co-conspirators, charging an additional mark-up on each prescription. As the last step in the scheme, Melendez and his co-conspirators submitted the fraudulent prescriptions to Medicare for reimbursement, billing up to $5,865 for each power wheelchair. All told, Dr. Schwartz wrote at least 186 fraudulent power wheelchair prescriptions for Medicare beneficiaries in exchange for more than $55,000 in bribes and kickbacks. Melendez, the owner and operator of Oceanside Medical Services, purchased these 186 fraudulent prescriptions and used them to submit over $830,000 in false claims to Medicare. Co-conspirators Aristeo and Laura Tavares, who were charged in a separate case, submitted more than $250,000 in false Medicare claims based on Dr. Schwartz’s fraudulent prescriptions.
United States Attorney Duffy reiterated that combating health care fraud is a top priority of the Department of Justice. “Anyone attempting to defraud Medicare – whether a doctor, medical equipment supplier, or patient recruiter – will be prosecuted to the fullest extent of the law, and should understand that the prognosis includes a substantial prison sentence, like the one imposed today.” United States Attorney Duffy thanked the Federal Bureau of Investigation and Department of Health and Human Services, Office of Inspector General, for their diligence and perseverance in breaking up this health care fraud conspiracy.
Dr. Schwartz is scheduled to be sentenced on August 19, 2013, before Judge Huff. On March 27, 2013, Aristeo and Laura Tavares were sentenced to time served (1 day in custody), and ordered to pay $182,860.77 in restitution to the Medicare trust fund. Hernandez was sentenced today to 6 months home confinement, and ordered to pay $160,000 in restitution to Medicare.
DEFENDANT CRIMINAL CASE NO. 12cr2599-H Jose Melendez SUMMARY OF CHARGESCount 1: Conspiracy to Pay and Receive Health Care Kickbacks and Defraud -Title 18, United States Code, Section 371; Maximum Penalty: Five years in custody; $250,000 fine; 3 year of supervised release; and mandatory restitution.
INVESTIGATING AGENCIESFederal Bureau of Investigation
Department of Health and Human Services, Office of Inspector GeneralOswego County Man Sentenced in Listed Chemical CaseRead the Press Release
SYRACUSE, NEW YORK – Cy D. Rayder, age 29, of Williamstown, New York, was sentenced today by the Hon. Frederick J. Scullen to a term of thirty-six months imprisonment for his guilty plea to possessing and distributing a listed chemical, pseudoephedrine, knowing it was intended to be used to manufacture methamphetamine. Between September and December, 2011, Rayder purchased pseudoephedrine pills from pharmacies in Oswego, Oneida, and Jefferson counties, which pills he provided to another individual who, in turn, used the pills to manufacture methamphetamine. In return for the pills, Rayder received finished product methamphetamine, which he ingested. Eventually, Rayder learned how to manufacture methamphetamine himself, and thereafter used the pills he purchased to manufacture methamphetamine. Rayder knew there were restrictions on the sale of pseudoephedrine, and that the sales were documented by the pharmacies, so, to avoid scrutiny, Rayder on occasion purchased pseudoephedrine from different stores on the same day. On fourteen separate occasions between September and December of 2011, Rayder purchased pseudoephedrine pills with an aggregate weight of 33.6 grams of pseudoephedrine from Oswego, Oneida, and Jefferson county pharmacies, knowing at all times the pills he purchased were intended to be used in, and were in fact used in the manufacture of methamphetamine.
After he finishes his sentence of incarceration, Rayder will thereafter be placed on supervised release for a period of three years. Rayder was also ordered to pay a special assessment of $100.
The Rayder case was investigated by the New York State Police and the Syracuse Drug Enforcement Agency.
The case was prosecuted by Assistant U.S. Attorney Carl G. Eurenius, who can be reached at 448-0672.
Northwest MO, KC Residents Indicted for Meth, Illegal FirearmsRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a mother and son in northwest Missouri and a Kansas City, Mo., man have been indicted by a federal grand jury for their roles in a conspiracy to distribute methamphetamine and for illegally possessing firearms.
Carlos Olivas, also known as “Chuco,” 38, of Kansas City, John B. Carr, also known as “Brandon,” 24, of Galt, Mo., and his mother, Onis R. Eads, also known as Onis Regina Jones, 45, of Humphreys, Mo., were charged in a 15-count indictment returned by a federal grand jury on Thursday, June 20, 2013.
The federal indictment alleges that Olivas, Carr and Eads participated in a conspiracy to distribute methamphetamine from April 2012 to Feb. 11, 2013.
In addition to the conspiracy, Olivas is charged with one count of possessing methamphetamine with the intent to distribute, two counts of possessing firearms in furtherance of a drug-trafficking crime and two counts of being an unlawful user of methamphetamine, cocaine and crack cocaine while in possession of firearms. Olivas was allegedly in possession of a Smith & Wesson .380-caliber semi-automatic pistol, a Springfield Armory .40-caliber semi-automatic pistol, a Taurus 9mm semi-automatic pistol, a Ruger 9mm semi-automatic pistol, a Tanfoglio .22-caliber revolver, a Rohm .38-caliber revolver, and an Iver Johnson .38-caliber revolver on Jan. 25, 2013. Olivas was allegedly in possession of a Gwinn Firearms Bushmaster 5.56mm pistol and a Noble .22-caliber pump-action rifle with no serial number on Sept. 18, 2012. Olivas was allegedly in possession of a .380-caliber pistol in December 2012.
In addition to the conspiracy, Carr is charged with one count of possessing firearms in furtherance of a drug-trafficking crime, one count of possessing firearms after being convicted of a misdemeanor crime of domestic violence and one count of being an unlawful user of methamphetamine while possessing firearms. Carr was allegedly in possession of a Hi-Point Firearms .45-caliber pistol and a Calwestco .22-caliber pistol between Jan. 23 and Feb. 8, 2013. Carr was allegedly in possession of an Izhmash 12-gauge shotgun, a Hi-Point Firearms .45-caliber pistol and a Calwestco .22-caliber pistol on Feb. 8, 2013.
In addition to the conspiracy, Eads is charged with one count of possessing methamphetamine with the intent to distribute, one count of distributing methamphetamine, two counts of being an unlawful user of methamphetamine and marijuana while in possession of firearms and two counts of being a fugitive from justice while in possession of firearms. Eads was allegedly in possession of a Winchester 30-06 caliber rifle on May 31, 2013. Eads was allegedly in possession of a Springfield Armory .40-caliber pistol on Jan. 8, 2013.
Dickinson cautioned that the charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Rudolph R. Rhodes, IV. It was investigated by the Kansas City, Mo., Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Trenton, Mo., Police Department.
Newport News Man Pleads Guilty to MurderRead the Press Release
NEWPORT NEWS, Va. – Aronte D. Jarvis, 25, of Newport News pled guilty today to the 2008 murder of Jonte Terry in the Kmart parking lot located at Oriana Drive in Newport News.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia and Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after the plea was accepted by United States District Judge Arenda L. Wright Allen.
Jarvis was indicted on October 10, 2012 on charges of murder in aid of racketeering activity, discharge of a firearm during a crime of violence, murder with a firearm and drug conspiracy. His girlfriend, Tayvonna Licorish was charged in a superseding indictment with accessory after the fact and misprision of a felony. Jarvis will be sentenced to Life in prison when he is sentenced on September 20, 2013. Licorish is proceeding to trial on September 17, 2013 and faces a maximum sentence of 18 years in prison.
According to the indictment, Jarvis was a member of a criminal organization known as “Thug Relations,” operating in the Aqueduct Apartments, St. Michael’s Apartments, Warwick Lawns, Warwick Town Homes, Heritage Trace Apartments, Mariner’s Landing Apartments, Sharon Drive and the Savage Drive areas of Newport News. The defendant and others established the power and prestige of the gang through violence, including the murder of Jonte Terry on February 3, 2008. Terry, 22, was shot in the Kmart parking lot located at Oriana Drive in Newport News. The indictment alleged that Terry was killed by Jarvis for the purpose of maintaining his position in “Thug Relations.”This case was investigated by the Federal Bureau of Investigation, with the assistance of the Newport News Police Department and the Virginia State Police. Assistant United States Attorneys Howard J. Zlotnick and Lisa R. McKeel are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
More Face Consequences in Teacher Certification Cheating ScamRead the Press Release
Memphis, TN – James Sales, 39, of Memphis, TN, and Corey A. Holmes, 36, of Greenville, MS, were indicted yesterday on charges related to the teacher certification cheating scam in which Clarence Mumford, Sr., 59, of Memphis was the ringleader, announced United States Attorney for the Western District of Tennessee, Edward L. Stanton III. Holmes and Sales were each charged with conspiracy to commit mail fraud, wire fraud and social security fraud, and Sales was also charged with an individual count of wire fraud and two counts of social security fraud.
Corey Alexander, 38, of Cordova, TN
Mumford, Sr. pled guilty on February 1, 2013 to a conspiracy to violate the laws of the United States, wire fraud, and aggravated identity theft. He was sentenced on May 13, 2013 to seven years in prison. During the guilty plea hearing for Mumford, Sr., it was revealed that numerous individuals paid Mumford to have PRAXIS examinations taken on their behalf. Many were teaching under temporary licenses and needed the examinations passed to retain their jobs. Others were attempting to obtain teaching jobs, or were teachers seeking additional endorsements on their licenses, in subjects such as guidance counseling. Many obtained teaching licenses in Tennessee and Mississippi based on the examinations. Many, however, never obtained licenses. Sometimes Mumford’s test-takers did not show up or did not pass. Test-takers identified during the investigation admitted taking approximately 70 to 90 tests during the course of the scheme, which dated back to 1995. Mumford, Sr. paid test-takers from $200 to $1000 per examination during the course of the conspiracy and charged individuals prices ranging from $1,000 to $6,000 for multiple examinations.
Investigators began to unravel the ring after John Bowen – who has pled guilty and been sentenced – was caught at Arkansas State University taking a test in the morning in one person’s name and in the afternoon in a second person’s name. In addition to Bowen, proctors caught Shantell Shaw and Carlos Shaw – who have also pled guilty and been sentenced – taking morning and afternoon session examinations in multiple names. Educational Testing Services, which created and administered the PRAXIS examinations, investigated and reported the incident to the Tennessee Department of Education, which referred the case to the Tennessee Bureau of Investigation. The United States Secret Service later joined the investigation.
As alleged in the indictment, Sales conspired with Mumford to have three PRAXIS examinations taken on his behalf – in Geography, World and U.S. History and Principles of Learning and Teaching – in April and June of 2009. Test-takers used Sales’ social security number while posing as Sales to take the examinations. Sales later submitted an application to the Memphis City Schools in May 2010, citing the Geography and Principles of Learning and Teaching examinations in his educational testing history.
As alleged in the indictment, Holmes conspired with Mumford to have multiple PRAXIS examinations taken on his behalf – in Pre-Professional Skills: Reading, Writing and Mathematics; and in Physical Education – in April 2008. Holmes also conspired with Mumford to have multiple PRAXIS examinations taken on behalf of another individual – in Pre-Professional Skills: Reading, Writing and Mathematics; and in Elementary Education – between May and November 2008.
In addition to the indictments of Sales and Holmes, Clarence Mumford, Jr., 29, of Memphis, TN, was sentenced today by U.S. District Judge John T. Fowlkes, Jr. to three years of probation including eight months of home confinement and monthly community service for his role in the teacher certification cheating scam. Mumford, Jr. was charged last August with having a PRAXIS examination taken on his behalf in 2008. During Mumford, Jr.’s sentencing hearing and his March 2013 guilty plea hearing, it was revealed that in addition to having an examination taken on his behalf, Mumford, Jr. also took examinations on behalf of a number of other individuals.
U.S. Attorney Stanton also announced today that the United States has entered into diversion agreements and statute of limitations waivers with the following individuals:
Samuel Campbell, 39, of Jackson, MS
Darcel Gardner, 35, of Columbus, MS
Jermaine Johnson, 35, of Bartlett, TN
Rondavius Milam, 38, of Memphis, TN
Jadice Moore, 31, of Port Gibson, MS
Sarah Richard, 55, of Richland, MS
Mario Robinson, 31, of Jackson, MS
Shelvie Rose, 32, of Cordova, TN
Devin Rutherford, 36, of Cordova, TN
Marshay Thornton, 32, of Memphis, TN
Tracey Shaw, 41, of Hales Corners, WI
Kimberly Taylor, 37, of Charleston, MS
Timothy Williams, 43, of Lyon, MS
Cedrick Wilson, 34, of Memphis, TN
Ellix Wilson, 27, of Jackson, TN
The agreements bar these individuals from teaching for five years, regardless of whether they obtain valid teaching certificates based on their own scores, or whether they have already done so. These individuals have also signed five-year statute of limitations waivers so that if they attempt to obtain a teaching job within five years they will be prosecuted. In addition, the agreements require restitution from the individuals who obtained teaching licenses and positions as a result of tests arranged by Clarence Mumford, Sr. Today’s announcements bring the total number of individuals sentenced, indicted or charged to 48.
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This investigation is being conducted by the Tennessee Bureau of Investigation and the United States Secret Service. Assistant U.S. Attorney John Fabian and Special Assistant U.S. Attorney Kirby May represent the government.
The charges and allegations contained in the indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Montgomery County Man Sentenced to 21+ Years in Marijuana Trafficking CaseRead the Press Release
WICHITA, KAN. – A Montgomery County man has been sentenced to 262 months in federal prison for marijuana trafficking, U.S. Attorney Barry Grissom said today.
Rashon T. Johnson, 37, Independence, Kan., pleaded guilty to one count of conspiracy to distribute marijuana, three counts of attempted possession with intent to distribute marijuana, three counts of traveling in interstate commerce in furtherance of drug trafficking, one count of unlawful use of a telephone in furtherance of drug trafficking and one count of money laundering.
In his plea, Johnson admitted that from January 2009 to January 2011 he and others conspired to obtain marijuana from Texas to distribute it in Kansas and elsewhere. Members of the conspiracy traveled to Texas at the direction of Johnson to buy marijuana and bring it to Kansas.
Johnson admitted: – On Jan. 22, 2010, he provided $44,000 to co-defendant Jessica Savage to travel from Kansas to Texas to obtain marijuana and bring it back to Kansas. She drove to Dallas in a car he rented. She was not able to obtain marijuana because the money was stolen.
– On May 25, 1010, co-defendant Andrel Spates was arrested in Texas driving a 2008 BMW provided by Johnson that contained 350 pounds of marijuana.
– On Aug. 18, 2010, Johnson spoke to co-defendant Mansi Patel by telephone while Johnson was incarcerated in a Kansas prison. They talked about Patel traveling to Texas to buy marijuana.
– On Aug. 24, 2010, Mansi Patel and Andrel Spates traveled from Kansas to the airport in Tulsa planning to fly to Houston to buy marijuana. They had in their possession money Johnson had provided for the purchase of marijuana.
– In December 2009 Johnson and Patel used money derived from trafficking in marijuana to buy property near Kaufman, Texas valued at more than $123,000.Co-defendants include: – William Lawrie, who was sentenced to 82 months in federal prison.
– Cornelius Colbert, who was sentenced to 24 months in federal prison.
– Andrel Spates, who was sentenced to 46 months in federal prison.
– Chadd Kasan Johnson, who was sentenced to 87 months in federal prison.
– Jamal Pilee Jemmerson, who was sentenced to a year and a day in federal prison.
– Jessica Leota Savage, who was sentenced to four months in federal prison.
– Cassandra Jonay Shafer, who was sentenced to one year probation.
– Mendi Lynn Carr, who was sentenced to 10 months in federal prison.
– Mansi Patel, who is set for sentencing July 1.Grissom commended the Kansas Bureau of Investigation, Assistant U.S. Attorney Lanny Welch and Assistant U.S. Attorney David Lind for their work on the case.
Miami Resident Sentenced in Identity Theft Tax Fraud Scheme Involving Baptist Health System Patient InformationRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael J. DePalma, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), announced today’s sentencing of defendant Cristobal Raul Puig, 25, of Miami. Puig was sentenced to 31 months in prison, to be followed by three years of supervised release.
Puig previously pled guilty to one count of possessing 15 or more social security numbers of other persons, with corresponding names and dates of birth, and one count of knowingly using, without lawful authority, the means of identification of another person.
According to court documents, an employee of Baptist Health System’s West Kendall location sold the names, dates of birth, social security numbers, and addresses of hospital patients to Puig. Defendant Puig then used the stolen patient identification information to file unauthorized income tax returns. At the time of his arrest, Puig was in possession of a list containing the names, dates of birth, social security numbers, and addresses of 20 recent hospital patients.
Mr. Ferrer commended the investigative efforts of IRS-CI. The case is being prosecuted by Assistant U.S. Attorney Maurice A. 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.
Mexican National Sentenced to 17.5 Years in Federal Prison for Methamphetamine Trafficking and Firearms ConvictionRead the Press Release
ALBUQUERQUE – Jesus Omar Lopez-Valle, 28, a Mexican national from Culiacan, Sinaloa, Mexico, was sentenced this morning to 210 months in federal prison, announced U.S. Attorney Kenneth J. Gonzales and Carol K.O. Lee, Special Agent in Charge of the FBI’s Albuquerque Division. Lopez-Valle will be deported after he completes his prison sentence.
Jesus Lopez-Valle, his brother Hector Manuel Lopez-Valle, 24, a Mexican national also from Culiacan, Sinaloa, Mexico, and Adaucto Chavez-Meza, 20, a legal permanent resident from Chihuahua, Mexico, were arrested on criminal complaints in March 2012, after they attempted to sell approximately four pounds of methamphetamine to an undercover officer. At the time, the three men were living in Belen, N.M., and the Lopez-Valle brothers were illegally in the United States.
The three men were indicted on March 28, 2012, and charged with conspiracy and possession of methamphetamine with intent to distribute. Jesus Lopez-Valle also was charged with being an illegal alien unlawfully in possession of a firearm. Jesus Lopez-Valle entered a guilty plea to all three charges on March 8, 2013.
According to court filings, on Feb. 21, 2012, Chavez-Meza and the undercover officer discussed the prospect of a methamphetamine deal. Thereafter, on Feb. 23, 2012, Chavez-Meza met the undercover officer at the Sandia Resort and Casino and agreed to sell the officer three pounds of methamphetamine at a price of $14,500 per pound. Chavez-Meza arrived at the meeting site with Jesus Lopez-Valle who did not participate in the meeting. On March 1, 2013, Chavez-Meza met the undercover officer at a gas station in the vicinity of Montgomery Blvd. NE and Interstate 25 in Albuquerque with the intention of selling four pounds of methamphetamine to the officer. Chavez-Meza arrived in a vehicle driven by Hector Lopez-Valle and Jesus Lopez-Valle arrived at the meeting site in a separate vehicle. After retrieving a package containing methamphetamine from the truck, Chavez-Meza entered the undercover officer’s vehicle and the officer drove to a nearby apartment complex followed by Jesus Lopez-Valle and Hector Lopez-Valle. Shortly thereafter, FBI agents arrested Jesus Lopez-Valle, Chavez-Meza and Hector Lopez-Valle.
On Feb. 25, 2013, Chavez-Meza pleaded guilty to conspiracy and possession of methamphetamine with intent to distribute; he is scheduled for sentencing on July 8, 2013. Hector Lopez-Valle pleaded guilty to the same two charges on March 8, 2013 and is scheduled for sentencing on July 22, 2013. Each faces a mandatory minimum ten years in prison and a maximum of life in prison. They remain in custody pending their sentencing hearings.
This case was investigated by the Cross Border Drug Violence Squad of the FBI’s Albuquerque Division and the Las Cruces Metro Narcotics Agency, and is being prosecuted by Assistant U.S. Attorneys Samuel A. Hurtado and Nicholas Jon Ganjei.
The FBI’s Cross Border Drug Violence Squad is a hybrid squad comprised of agents with various investigative backgrounds, including narcotics, white collar, public corruption and gang expertise, to promote more comprehensive investigations. The FBI created hybrid squads along the Southwest Border which are dedicated to combating Mexican drug cartels and the violent crime threat along the border after Congress passed the Border Security Appropriations Bill in Aug. 2010, which directed and funded the FBI to create these squads. The Albuquerque Division’s Cross Border Violence Squad focuses its investigative efforts on Mexican drug cartels and the major Mexican Drug Trafficking Organizations in New Mexico that support the cartels.
Metro Denver Man Sentenced to Federal Prison for Health Care Related FraudRead the Press Release
DENVER – John Edward Mullikin, age 51 of Arvada, was sentenced today by U.S. Circuit Judge David M. Ebel to serve 72 months in federal prison, the United States Attorney’s Office and the Food and Drug Administration’s Office of Criminal Investigations announced. Mulliken was also ordered to pay $5,376 in restitution, and following his prison sentence, the defendant will have to serve 3 years on supervised release. Mullikin, who appeared at the sentencing hearing in custody, was remanded the hearing’s conclusion.
Mullikin was indicted by a federal grand jury on November 14, 2011. A superseding indictment was obtained on August 21, 2012. Following an 8 day trial, on February 13, 2013, a federal jury found him guilty of 17 counts of mail fraud. He was sentenced today, June 24, 2013.
According to the court documents and evidence presented at trial, between April 2006, and continuing through July 2008, John Edward Mullikin, devised and knowingly executed and attempted to execute a scheme to defraud various individuals throughout the United States. The scheme to defraud involved luring individuals throughout the United States into paying monies to him in order to participate in a bogus clinical study with the promise the monies would be returned along with further compensation. During this same period of time, the defendant was serving a term of parole in relation to four separate felony convictions involving theft in Adams, Arapahoe and Denver counties. John Edward Mullikin promoted a study of his weight loss product, which he referred to as “medication”, that he claimed was not a placebo, and that he named “DBL-824" on one website and “Evaril II” on another website. In truth and in fact, the substance was a placebo that merely contained small amounts of vitamins E and C. He then recruited study participants by advertising throughout the United States in newspapers, magazines and on the internet, in the names of various business entities, which contained materially false and fraudulent representations in order to convince participants to enroll in his clinical trial. John Edward Mullikin made materially false and fraudulent representations that the study was part of the National Institutes of Health Obesity Research Task Force and was the subject of a legitimate clinical study “conducted by a respected university research center.”
John Edward Mullikin also made materially false and fraudulent representations that clients would be participating in an “observational efficacy study” of his weight loss product, that “DBL-824 has demonstrated significant effect in Phase I, Phase II, and Phase III clinical trials,” and that “This observational study will obtain further data to complement the recently completed control studies,” when in fact no such clinical studies had ever been conducted. He required all participants to pay an advance fee of $150 “refundable deposit” for the Evaril II study and $144 “one-time refunded deposit” for the DBL-824 study, both of which he falsely represented would be refunded along with the promised compensation. John Edward Mullikin lured participants into the study by making materially false and fraudulent representations that participants would be compensated over $1,000 by the conclusion of the 6 month Evaril II Study and $319.72 per month for 24 months (a total of $7,673.52) by the conclusion of the DBL-824 study. During the scheme, John Edward Mullikin created non-profit corporations, registered trade names, and did business under assumed names, including but not limited to Progenics Research, Inc., IUCDHSC, Inc., RAND Corporation, Metacor labs, Evaril Study, and Research Study UCDHSC Evaril.
He also opened checking accounts at financial institutions in Colorado in his name and in the names of various business entities in order to receive checks and monies derived from the scheme. Further, John Edward Mullikin assumed names such as John Milliken, Jack Edwards, John Edwards and Tim Alexander to conceal his true identity. He provided documents to his victims supporting those false and fraudulent representations, such as medical questionnaires, study descriptions, FAQ’s (frequently asked questions), and other materials stating the benefits of participating in a clinical trial. He also directed prospective clients to print and complete the “Enrollment Form” provided on his website and directed them to “mail the completed Enrollment Form and contact information” to various company names at various Post Office boxes in Colorado registered to and utilized by him. He thereby caused study participants to send checks, money orders, and monies written to various business entities, which he then caused to be deposited in bank accounts he controlled. Once he received the victims’ advance fee for participation in the study, John Edward Mullikin withdrew or spent the monies and ceased contact with his victims. Mr. Mullikin did not pay the victims the compensation promised in exchange for their participation in his bogus clinical study, nor did he refund the advance fee that he described as a deposit.
The Mullikin case was investigated by Special Agent Mary LaFrance of the United States Food and Drug Administration Office of Criminal Investigations.
The defendant was prosecuted by Assistant U.S. Attorney Jaime Pena.
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Man Pleads Guilty to Embezzling over $1 Million from San Diego Company to Fund Fledgling Professional Football LeagueRead the Press Release
Jaime Cuadra, the former chief financial officer of Oceanic Enterprises, Inc. pled guilty today to wire fraud and filing a false federal income tax return in connection with his embezzlement of $1,089,813.26 from Oceanic and its parent company, Umami Sustainable Seafood, Inc., a San Diego-based, publically traded company.
As set forth in his plea agreement, Cuadra admitted that he embezzled the money over a two-and-a-half-year period from 2010 until his termination from Oceanic in February 2013. Cuadra took advantage of his position as CFO to access Oceanic's accounts and withdraw money for his personal benefit. Cuadra primarily used the money to fund a fledgling professional football league of which Cuadra served as the president and chief executive officer during the period of his fraud.
According to court documents, Cuadra admitted that he used embezzled funds to develop the league and attract investors by paying league executives, as well as the league's marketing, consulting, and public relations fees. Cuadra resigned as the president and CEO of the professional football league in February 2013. Cuadra admitted he used embezzled funds for other purposes as well, such as to: 1) financially support other outside business ventures (including a T-shirt business); 2) lease a Porsche Cayenne; 3) pay for personal travel, hotels, and meals; 4) purchase a variety of miscellaneous items, including artwork, designer clothing, computers and entertainment systems, and tickets to sporting events; and 5) deposit funds into his personal accounts and obtain cash from automated teller machines. Cuadra admitted that he hid his embezzlement from Oceanic and Umami by falsifying Oceanic's financial records in part by coding his illicit transfers as legitimate business expenses.
Cuadra also filed false tax returns for the years in which he carried out his scheme to defraud Oceanic and Umami. Specifically, he admitted that he failed to report his embezzled income on his 2010-2012 tax returns and, in one instance, wrote off an expense he paid with embezzled funds as a "partnership loss," which further reduced his adjusted gross income. In all, Cuadra admitted that his false tax returns resulted in unpaid taxes of $387,347.58. As a condition of his plea, Cuadra must pay back the full amount of his unpaid taxes as well as the more than $1 million he stole from Umami.
United States Attorney Laura E. Duffy praised the hard work of the agents from the Federal Bureau of Investigation and the Internal Revenue Service and reiterated her support of financial-crime prosecutions: "Today's guilty plea is yet another example of our office's commitment to investigate and prosecute those who illegally take advantage of positions of trust for their own personal gain."
FBI Special Agent in Charge, Daphne Hearn, commented: “At its most basic level, this case is about greed and the abuse of trust. I commend the efforts of the FBI Agents and Financial Analysts who worked tirelessly to uncover this sophisticated embezzlement scheme. I also want to thank the IRS and the U.S. Attorney's Office for their important roles in this investigation.”
“Jaime Cuadra used his position of trust as Chief Financial Officer to defraud over $1 million dollars from two San Diego based companies, Oceanic Enterprises and Umami Sustainable Seafood Inc.,” said Jose A. Gonzalez, Special Agent in Charge of IRS Criminal Investigation’s Los Angeles Field Office. “Cuadra’s failure to pay federal income taxes of $387,347.58 on his embezzled funds further confirms that his methodical greed and criminal activity was for his personal benefit. Today’s guilty plea entered by Cuadra reaffirms IRS CI’s commitment to investigate and prosecute those who misuse their position of trust to conduct criminal activity.”
Cuadra is scheduled to be sentenced Sept. 23 at 9 a.m. before Judge Huff.
DEFENDANT Criminal Case No. 13cr2298-H Jaime Cuadra SUMMARY OF CHARGESCount 1: Title 18, United States Code, Section 1343 B Wire Fraud
Maximum penalties: 20 years custody; $250,000 fine; 3 years supervised release.Count 2: Title 26, United States Code, Section 7206(1) B Filing a False Federal Income Tax Return
INVESTIGATING AGENCIES
Maximum penalties: 3 years custody; $250,000 fine; 1 year supervised release.Federal Bureau of Investigation
Internal Revenue ServiceLos Angeles Podiatrist Sentenced to Two Years in Federal Prison for His Role in $3 Million Identity Theft and Bank Fraud SchemeRead the Press Release
LOS ANGELES – The founder of the Releford Foot and Ankle Institute has been sentenced to 24 months in federal prison for his conviction on federal fraud charges related to a bank fraud scheme that used stolen identities to cause two financial institution to suffer $3 million in losses.
Dr. Bill Releford, 53, who resides in downtown Los Angeles, received the two-year sentence yesterday afternoon from United States District Judge Terry J. Hatter Jr. In addition to the prison term, Judge Hatter ordered Releford to pay $218,237 in restitution and a $10,000 fine.
Releford pleaded guilty in May 2012 to participating in a scheme to defraud Bank of America and Wells Fargo Bank, specifically admitting that he participated in the scheme to obtain money for his medical practice, which has offices in Beverly Hills and Inglewood.
At yesterday’s sentencing hearing, Judge Hatter told Releford that if he was “man enough to do the crime,” then he had to be “man enough to do the time.” Judge Hatter noted Releford’s attempts to rehabilitate himself – such as Releford’s offer to immediately pay $1,500 in restitution and his recent participation in charitable projects – and said this effort spared Releford from a longer prison sentence.
Releford and five other co-defendants operated a scheme to defraud financial institutions by using stolen identities to establish business lines of credit which were fraudulently drawn down to provide money that was used for their personal expenses. After obtaining stolen personal identifying information – including dates of birth, Social Security numbers, credit profiles and driver’s license numbers from victims with high credit scores, including another physician from Pasadena – members of the conspiracy submitted fraudulent applications for business lines of credit to various banks. Once the applications were approved, the defendants liquidated the credit lines.
Over the course of the scheme, Releford helped the other defendants open at least two credit lines that provided funds for Releford’s medical practice. Releford also attempted to open a third credit line valued at up to $500,000, which he planned to use to fund a clothing business. Releford further participated in the scheme by helping to launder thousands of dollars from other fraudulently obtained credit lines.
A federal grand jury indicted Releford and five others in May 2011 (see: http://www.fbi.gov/losangeles/press-releases/2011/six-los-angeles-residents-charged-in-bank-fraud-scheme-where-stolen-identities-were-used-to-establish-lines-of-credit). The five co-defendants – Andrea Avery Kirkland Charles, William Earl Gordon, Annita Hawes and James Arthur Booker – previously pleaded guilty and received sentences of up to 88 months in federal prison.
In total, the scheme caused more than $3 million in losses to Bank of America and Wells Fargo Bank. The scheme used identities stolen from more than 70 individual victims.
This case was investigated by agents with the Federal Bureau of Investigation, the United States Postal Inspection Service and IRS - Criminal Investigation Division.
Release No. 13-083
Long Beach Man Charged with Sex Trafficking of Teenage GirlRead the Press Release
LOS ANGELES – A Long Beach man who allegedly forced a 17-year-old girl to work as a prostitute has been named in a federal criminal complaint that charges him with child sex trafficking.
Ralph Allen Jackson Jr., 40, who was known by the alias “Mac Wimp,” was arrested by Long Beach Police Department vice detectives last Tuesday night on state charges after they responded to a domestic disturbance call at his residence. Jackson was named in a criminal complaint filed late Friday in United States District Court.
Following Jackson’s arrest last Tuesday, vice detectives determined that the incident involved child sex trafficking and contacted special agents from U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
Jackson, who is expected be turned over to federal authorities tomorrow, is expected to make his initial appearance in federal court tomorrow afternoon.
The criminal complaint filed Friday charges Jackson with sex trafficking of children by force. If he is convicted, he would face a mandatory minimum sentence of 15 years and statutory maximum penalty of life in federal prison.
“The sex trafficking of women and juveniles is a horrible offense that warrants an immediate and assertive response,” said United States Attorney André Birotte Jr. “The charges demonstrate that we are prepared to quickly respond to such cruel conduct. Together with our partners in law enforcement, such as the Long Beach Police Department, we will continue to pursue and prosecute anyone who engages in the vile exploitation of women or children.”
According to the affidavit in support of the criminal complaint, the teenage victim told investigators that she met Jackson in March and, following a series of phone calls and text messages, met him for dinner earlier this month. The girl told Jackson that she was 17, which allegedly prompted Jackson to tell her this would be their “secret.”
The victim told investigators that Jackson subsequently forced her into prostitution, arranging for her to have sex with dozens of male clients and warning her that she would be beaten if she resisted. The affidavit states the victim was required to work the streets approximately 12 hours a day and was allowed only one daily meal.
“The actions of those who prey on the vulnerability of young women in our community and exploit them through threats and intimidation will not be tolerated,” said Long Beach Police Chief Jim McDonnell. “We will continue to join forces with our federal partners to ensure these individuals are being prosecuted to the fullest extent possible.”
Claude Arnold, special agent in charge for HSI Los Angeles, stated: “Forcing anyone, much less a child, to prostitute themselves from morning until night with no rest, little food and threats of physical harm is not only criminal – it is morally reprehensible. That what amounts to modern slavery occurs here in the 21st century is unconscionable. HSI is committed to ensuring that those involved are held accountable for their crimes.”
According to the affidavit, in mid-June Jackson took the victim to a tattoo shop and ordered her to get a tattoo that included his street name: “Mac Wimp’s bitch.” The victim told investigators that Jackson threatened to harm her if she did not comply.
After the teen victim fled Jackson’s residence about eight days ago, Jackson allegedly sent her text messages threatening to harm her family if she did not return. When the victim went to Jackson’s home last Tuesday to retrieve her things, there was an altercation, which prompted the domestic disturbance call to the Long Beach Police Department.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.
Authorities believe there may be unknown victims of Jackson. Anyone with information about this matter is encouraged to call HSI’s toll-free tip line at 1-866-DHS-2ICE (1-866-347-2423) or submit a information using HSI’s online tip form at http://www.ice.gov/exec/forms/hsi-tips/tips.asp.
Release No. 13-083
Leaders of scheme to embezzle from Trident Seafoods sentenced to 46 months in prisonRead the Press Release
Anchorage, Alaska B U.S. Attorney Karen L. Loeffler announced today that a Kodiak woman was sentenced for her role in embezzling $493,060 from Trident Seafoods.
Isairis Wolfe, 33, of Kodiak, Alaska, was sentenced today by Chief U.S. District Court Judge Ralph R. Beistline, to 46 months in prison and to pay full restitution.
According to Assistant U.S. Attorney Aunnie Steward, who prosecuted the case, from January 2008, and continuing until August 2010, Wolfe used her position as the book keeper for Trident Seafoods in Kodiak, to write Trident checks to four of her personal associates Anne Wilson, Jeremy Smith, Valerie Olivares, and Jamie Fathke. Wolfe, using her check writing authority at Trident, drafted approximately 52 checks on a Trident Seafoods account for approximately $500,000, and made them payable to her personal associates Wilson, Smith, Olivares, and Fathke, as well as to Wilson's minor son L.E. The checks were negotiated by Wolfe and her associates and they shared the proceeds. Wolfe concealed the fraud by creating fraudulent accounting records so that the payments appeared to be legitimate.
Wolfe indicated at sentencing that her methamphetamine habit clouded her judgment and contributed to her poor choices in undertaking the scheme.
Information presented at sentencing indicated that Wolfe spent the money she embezzled on diamond jewelry, a new truck, and an addition to her house, among other things.
Judge Beistline noted that Wolfe’s scheme was motivated by greed, showed a lack of concern for her co-defendants, and abused the trust of her employer.
Deirdre Fike, Special Agent in Charge of the FBI in Alaska stated, “Ms. Wolfe’s fraudulent activities significantly impacted Trident Seafood’s operations. I would like to thank the Kodiak Police Department for their assistance in this investigation.”
Ms. Loeffler commends the FBI for the investigation of this case.
Last of the Arellano-Felix Brothers SentencedRead the Press Release
SAN DIEGO, CA - Eduardo Arellano-Felix, who acted as the chief financial officer of the notorious Mexican drug cartel that bears his family name, was sentenced today in federal court to 15 years in prison for laundering tens of millions of dollars in illicit drug proceeds.
Arellano-Felix is the last of four brothers to be targeted by U.S. prosecutors for leading what was once among the world’s most violent and powerful multi-national drug trafficking organizations. He pleaded guilty in May to money laundering and conspiracy charges.
In handing down the sentence, U.S. District Judge Larry A. Burns told the defendant that even though he was less involved in the unsavory aspects of the drug business than his brothers, nevertheless he was “still an integral part” and “fully aware of the methods” of the cartel and “should be ashamed” of his actions, which have had “terrible and longlasting effects” on this community and the relationship between the U.S. and Mexico.
According to court documents, the AFO moved hundreds of tons of cocaine and marijuana from Mexico and Colombia into the U.S. and made hundreds of millions of dollars in the process. The cartel terrorized the Southwest border and beyond with executions, torture, beheadings, kidnappings and bribes to law enforcement, military personnel and government officials.
In a sentencing memorandum, prosecutors wrote that Arellano-Felix was a major force within the cartel leadership. “In his position, Defendant advised his brothers as they orchestrated the importation of hundreds of tons of cocaine and marijuana into the United States, ordered the kidnap and murder of numerous people, and directed the widespread corruption of law enforcement and military personnel in Mexico. Defendant also personally laundered at least tens of millions of dollars in illicit proceeds, and purchased large numbers of firearms for use by the AFO. Defendant’s actions resulted in destroyed lives and untold suffering on both sides of the border.”
U.S. Attorney Laura Duffy said: “The three living Arellano Felix brothers, who for decades lived as multi-millionaires while terrorizing the Southwest border, ordering assassinations and corrupting countless public officials - are now confined to maximumsecurity prison cells for a very long time. I urge others who aspire to take their place to take note.”
Duffy praised the dedicated team of prosecutors and federal agents from the DEA, FBI and IRS for overcoming the extreme challenges of building successful cases against the highest-ranking leaders of a major trafficking organization, who are typically insulated and difficult to prosecute. “It was an audacious goal to take this cartel down, and I’m extremely satisfied with the outcome.”
“The sentence that Eduardo Arellano-Felix received today marks the end of an era in cartel history. The AFO is finished, others have moved in and are attempting to take their place,” says Special Agent in Charge of the DEA San Diego William R. Sherman. “Our warning to those who emulate the members of that once powerful cartel, take a good look at your future. Our commitment to hunting down and arresting those people trafficking drugs across the US/Mexico border has not wavered but has only grown stronger. DEA and our law enforcement partners are already actively pursuing all those who dare attempt to fill the void left by the demise of the AFO.”
San Diego FBI Special Agent in Charge Daphne Hearn said, “Today's sentencing demonstrates the unwavering commitment of the FBI to continue working with our domestic and international law enforcement partners to disrupt and dismantle violent criminal enterprises such as the Arellano-Felix Organization that instill fear and threaten the safety of our citizens.”
Jose A. Gonzalez, Special Agent in Charge for IRS Criminal Investigation’s Los Angeles Field Office commented: “Today’s sentencing of Eduardo Arellano- Félix, the last brother and a former leader who ran Arellano- Félix Organization’s (AFO), is a significant contribution to the end of a brutally violent, multi-national drug cartel. Today is a triumph for prosecutors and federal agents who have worked for years to dismantle and bring key leaders to justice. Ill-gotten gains derived by the AFO were the essential backbone of this organization and IRS Criminal Investigation, working with our law enforcement partners, leveraged our financial expertise to assist in the dismantling of this dangerous and deadly drug cartel.”
It’s been a long road to get to this point.
Arellano-Felix was first indicted in 1998, along with his brothers, on drug conspiracy charges. Then in 2002, prosecutors added charges of racketeering, money laundering and conspiracy to distribute and import marijuana and cocaine in a subsequent indictment. He was arrested by Mexican authorities in Tijuana, Baja California, Mexico on October 25, 2008. A final order of extradition to the United States was granted in 2010.
After two years of unsuccessful appeals, Arellano-Felix was extradited by the government of Mexico to the United States on August 31, 2012, to face charges in the Southern District of California. He entered his guilty plea nine months later.
Two brothers and former leaders of the Arellano-Felix Organization (AFO) - Benjamin Arellano-Felix and Francisco Javier Arellano Felix - were captured in 2002 and 2006, respectively, and are currently serving sentences in the United States following their convictions for racketeering, drug trafficking, and money laundering charges. Benjamin was sentenced to 25 years in prison; Javier is serving a life term. Ramon Arellano-Felix, the cartel's enforcer, was killed in a shootout with police in 2002.
In his plea agreement, Arellano-Felix – a medical doctor nicknamed “El Doctor” - admitted he was a senior member of the AFO. He also admitted that he laundered hundreds of millions of dollars in drug trafficking proceeds and used some of the income to pay AFO members to commit crimes; to buy firearms, ammunition and vehicles; to travel on AFO-related business; to pay bribes; and to purchase drugs. He signed his plea agreement, “Dr. Eduardo Arellano Felix.”
In connection with his plea, Arellano-Felix will also forfeit $50 million. Before he was extradited, Arellano-Felix spent almost four years in custody in Mexico, from October 25, 2008 to August 31, 2012.
In addition to the brothers, this office has convicted a long line of top AFO lieutenants, including, in part, Arturo Paez-Martinez in 2002, Ismael and Gilberto Higuera-Guerrero in 2007 and Jesus Labra-Aviles in 2010.
This case (Case Number: 97cr2520-LAB) was investigated by agents from the Drug Enforcement Administration, the Federal Bureau of Investigation, and the Internal Revenue Service-Criminal Investigation and prosecuted in the Southern District of California by Assistant United States Attorneys Joseph S. Green, James P. Melendres, and Daniel E. Zipp.
The Criminal Division’s Office of International Affairs provided significant assistance in the extradition. The investigation of Eduardo Arellano-Felix was coordinated by an Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program was created to consolidate and coordinate all law enforcement resources in this country's battle against major drug trafficking rings, drug kingpins, and money launderers.
SUMMARY OF CHARGES IN GUILTY PLEASCount 1
Count 2
Title 18, United States Code, Sections 371 (Conspiracy to launder monetary instruments) Maximum penalty: 5 years of custody.
Title 21, United States Code, Sections 854(a) and 846 (Conspiracy to use and invest illicit drug profits) Maximum penalty: 10 years of custody.
Landlord Who Accepted Drugs as Rent Payments Sentenced to Nearly 4 Years in Federal PrisonRead the Press Release
Jerry Lowe leased a rental housing unit to Huntington pill dealers currently serving prison sentences for drug felonies
HUNTINGTON, W.Va. – A Huntington landlord who accepted illegal drugs as payment for monthly rent fees was sentenced today to three years and 10 months in prison on federal oxycodone charges, announced U.S. Attorney Booth Goodwin. Jerry A. Lowe, 46, previously pleaded guilty in March to distribution of oxycodone. On March 16, 2012, Lowe sold three 30-milligram oxycodone tablets in exchange for $90. Lowe previously leased a rental housing unit to convicted felons Rafael Cee-Erwin Solomon, 31, of Detroit and Shawna Danielle Lee, 26, of Huntington. Lowe told police that he typically received heroin or prescription painkillers from Solomon and Lee as payment for monthly rent. Lowe also purchased oxycodone pills from another resident at the Highlawn Avenue apartment complex. In addition, Lowe sold at least 10 “Norco” brand oxycodone pills once a month. Lowe sold the oxycodone pills for approximately two years.Solomon was previously sentenced in December 2012 to 11 years and three months in federal prison for conspiracy to distribute cocaine, crack cocaine, oxycodone, and oxymorphone. Danielle Lee was previously sentenced in September 2012 to one year and six months in federal prison for maintaining a residence for the purpose of distributing crack cocaine, cocaine, oxycodone and oxymorphone.
On June 13, 2012, law enforcement officers conducted a traffic stop of Lowe’s vehicle. During the stop, officers found Lowe in possession of 1.1 grams of heroin.The Huntington Violent Crimes and Drug Task Force conducted the investigation. Assistant United States Attorney Gregory McVey handled the prosecution. The sentence was imposed by Chief United States District Judge Robert C. Chambers.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Kanawha Co. Man Sentenced to Five Years in Federal Prison for Illegal Oxycodone PossessionRead the Press Release
MDENT agents found prescription painkillers and firearms including an AR-15 rifle at Rand residence
CHARLESTON, W.Va. – A Kanawha County man who possessed hundreds of prescription painkiller pills, five firearms and thousands in cash inside of his residence in June 2012 was sentenced today to five years in federal prison, U.S. Attorney Booth Goodwin announced. Terrico L. Straughter, 23, of Rand, Kanawha County, W.Va., previously pleaded guilty in March to possession with intent to distribute oxycodone. On June 13, 2012, members of the Metropolitan Drug Enforcement Network Team (MDENT) executed a search warrant on the defendant’s Rand residence. During the execution of the search warrant, police found approximately 999 30-milligram oxycodone pills and 43 grams of crack cocaine inside of the residence. Law enforcement agents also found a total of five firearms that included a loaded pistol on top of a night stand, and an AR-15 assault rifle that was located in a bedroom closet. Police also found 26 10-milligram hydrocodone pills, marijuana, and $12,747 inside of the residence.
The investigation was conducted by MDENT. Assistant United States Attorney Monica D. Coleman handled the prosecution. The sentence was imposed by United States District Judge Thomas E. Johnston.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Justice Department Reaches Agreement with Hanover <br /> County, Va., on Bailout Under the Voting Rights ActRead the Press Release
The Justice Department announced today that it has reached an agreement with Hanover County, Va., that will allow for the county, a covered jurisdiction under the special provisions of the Voting Rights Act, to bail out from coverage under these provisions. Bailout will exempt Hanover County, along with the town of Ashland, from the preclearance requirements of Section 5 of the Voting Rights Act. The agreement is in the form of a consent decree filed today in the U.S. District Court for the District of Columbia and must be approved by the court.
Under Section 5 of the Voting Rights Act, certain covered jurisdictions, determined according to Section 4 of the Act, are required to seek preclearance for any changes in voting qualifications, standards, practices or procedures from the U.S. District Court for the District of Columbia or from the U.S. Attorney General, prior to their implementation. Section 4 of the act provides that a covered jurisdiction may seek to “bail out,” or remove itself from such coverage, and therefore be exempted from the preclearance requirements, by seeking a declaratory judgment before a three-judge panel in the U.S. District Court for the District of Columbia. A bailout judgment can be issued only if the court determines that the jurisdiction meets certain eligibility requirements for bailout contained in the statute, including a 10-year record of nondiscrimination in voting-related actions. The act also provides that the Attorney General can consent to entry of a judgment of bailout only if, based upon investigation, the Attorney General is satisfied that the jurisdiction meets the eligibility requirements.
Hanover County filed its bailout action in the U.S. District Court for the District of Columbia on May 2, 2013. Counsel for the county contacted the Attorney General prior to filing the action, indicating that the county was interested in seeking bailout. The county provided the Justice Department with substantial information, and the department conducted an investigation to determine the county’s eligibility. Based on that investigation, the department is satisfied that Hanover County meets the Voting Rights Act’s requirements for bailout.
“In the department’s view, the county has met the requirements necessary for bailout. We reached this conclusion after thoroughly reviewing information provided by the county as well as information gathered during the Department’s independent investigation,” said Matthew Colangelo, Deputy Assistant Attorney General for the Civil Rights Division. “We appreciate the county’s cooperation in the resolution of this matter.”
The consent decree details the legal and factual basis for a bailout determination and, if approved by the court, the county’s request will be granted. The court will retain jurisdiction of the action for 10 years and can reopen the action upon the motion of the Attorney General or any aggrieved person alleging conduct by the county that would have originally precluded the county from bailing out if it had occurred during the 10-year period preceding entry of the consent decree.
Information about bailout, the Voting Rights Act and other federal voting laws is available on the Department of Justice website at www.justice.gov/crt/voting. Complaints may be reported to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.
June Grand JuryRead the Press Release
United States Attorney Deborah R. Gilg announced the federal Grand Jury for the District of Nebraska has returned 23 indictments charging 28 defendants. Indictments are charging documents that contain one or more individual counts that are merely accusations, and every defendant is presumed innocent unless and until proven guilty.
* Fernando Aguilar-Perez, age 28, of Omaha, is charged with illegal reentry into the United States on or about June 4, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Jason Armstrong, age 35, and Tamika Payne, age 34, both of Omaha, Nebraska, are charged in a seven-count Indictment. Count I of the Indictment charges both defendants with conspiracy to commit mail fraud by submitting fraudulent applications for benefits in the names of clients of the Nebraska Aids Project beginning on or about January 1, 2009, to on or about November 9, 2012. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, 3 years supervised release, and a special assessment of $100. Counts II thru VII alleges that on or about March 15, 2011 thru on or about May 30, 2012 the defendents caused checks to be issued in response to the fraudulent applications and sent through the United States mails to fraudulent landlord or property management companies they had created. The maximum possible penalty for these counts include imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Mateo Chay Citalan , age 32, of Omaha, is charged with illegal reentry into the United States on or about June 11, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Camacho-Perez, Alejandro, age 30, of Scottsbluff, Nebraska, is charged with illegal reentry into the United States on or about April 26, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Mark Fhuere, age 50, of Grand Island, is charged in the first count of an indictment with receipt and distribution of child pornography from at least on or about May 1, 2011, and continuing to on or about May 29, 2013. If convicted, the maximum possible penalty includes imprisonment of not less than 5 years or more than 20 years, a fine of $250,000, supervised release for life, and a $100 special assessment. Fhuere is charged in Count II with possession of child pornography from on or about May 29, 2013. The maximum possible penalty for this count includes imprisonment of 10 years, a $250,000 fine, supervised release for life, and a $100 special assessment. The indictment also alleges property used or intended to be used as part of this violation should be forfeited to the United States. The indictment also alleges any and all property constituting or derived from any proceeds obtained directly or indirectly as a result of the violation alleged in the indictment, including but not limited to: a. One computer b. One hard drive should be forfeited to the United States.
* Osvin Javier Garcia-Cerrato , age 21, is charged with distribution of 50 grams or more of actual methamphetamine on or about March 14, 2012. The maximum possible penalty is imprisonment of not less than 10 years and up to life, a $10 million fine, a 5 year term of supervised release and a $100 special assessment.
* David Garcia-Colimote, age 31, of Lexington, Nebraska, is charged with illegal reentry into the United States on or about May 23, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 10 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Melfin Arcinio Garcia-Olivares , age 29, is charged in a two count indictment. Count I alleges that on or about December 28, 2011, the defendant distributed 5 grams or more of actual methamphetamine. The maximum possible penalty is imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 4 year term of supervised release and a $100 special assessment. Count II alleges that on or December 30, 2011, the defendant distributed 5 grams or more of actual methamphetamine. The maximum possible penalty is imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 4 year term of supervised release and a $100 special assessment.
* Alejandrino Gutierrez-Castellanos, age 52, of Madison, Nebraska, is charged with illegal reentry into the United States on or about April 27, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Salvador Hernandez-Estrada, age 25, of Omaha, is charged with illegal reentry into the United States on or about May 24, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Marcus Jefferson, age 37, of Omaha, is charged in a two count indictment. Count 1 alleges that on or about August 1, 2010 and continuing until on or about September 26, 2012 the defendant possessed a .32 Smith and Wesson revolver after having been convicted of a felony. The maximum possible penalty for this count is imprisonment of 10 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II of the indictment alleges on or about September 26, 2012, the defendant possessed ammunition after having been convicted of a felony. The maximum possible penalty is imprisonment of up to 10 years, a fine of $250,000, a 3 year term of supervised release and a $100 special assessment.
* Johnny P. Jones, age 23, of Council Bluffs, Iowa, is charged with being a felon in possession of a firearm on or about May 29, 2013. The maximum penalty for this count is imprisonment of 10 years, a fine of $250,000, a 3 year term of supervised release, and a special assessment of $100.
* Jeffery Scott Kydney, age 26, of Niobrara, is charged with being a felon in possession of a firearm on or about May 27, 2013. The maximum penalty for this count is imprisonment of 10 years, a fine of $250,000, a 3 year term of supervised release, and a special assessment of $100.
* Diego Mejia-Aguilar of Omaha is charged with document fraud for selling forged and counterfeit Social Security Cards. The maximum possible penalty for this count includes imprisonment of 10 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Teodoro Molina-Navarrete, age 41, of Schuyler, Nebraska , is charged with illegal reentry into the United States on or about May 30, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Jorge Munoz-Roman, age 23; Froilan Cuevas, age 20; Luis Vallejo, age 31 and Luis Meza-Galvez, age 19, are charged in a four count indictment. Count I alleges that beginning on or about March 2013, and continuing to on or about May 24, 2013, the defendants Munoz-Roman, Vallejo, and Meza-Galvez conspired together and with others to distribute and possess with intent to distribute 500 grams or more of a mixture or substance containing methamphetamine. The maximum possible penalty is imprisonment of not less than 10 years and up to life, a $10 million fine, a 5 year term of supervised release, and a $100 special assessment. Count II alleges that beginning on or about March 2013 and continuing to on or about May 24, 2013, defendant Froilan Cuevas conspired with others to distribute a mixture or substance containing a detectable amount of methamphetamine. The maximum possible penalty is imprisonment of not more than 20 years, a $2 million fine, a 3 year term of supervised release, and a $100 special assessment. Count III alleges that on or about May 23, 2013, Meza-Galvez, possessed with intent to distribute 50 grams or more of actual methamphetamine. The maximum possible penalty is imprisonment of not less 10 years and up to life, a $10 million fine, a 5 year term of supervised release and a $100 special assessment. Count IV alleges that on or about May 23, 2013, Luis Vallejo possessed with intent to distribute 50 grams or more of actual methamphetamine. The maximum possible penalty is imprisonment of not less 10 years and up to life, a $10 million fine, a 5 year term of supervised release and a $100 special assessment. The indictment also alleges any and all property constituting or derived from any proceeds obtained directly or indirectly as a result of the violations alleged in the indictment should be forfeited to the United States, including but not limited to: a. $396.00 in United States currency seized from the person of Jorge Munoz-Ramon on May 23, 2013; b. $226.00 in United States currency seized from the person of Froilan Cuevas on May 23, 2013; c. $772.00 and $4,000.00 in United States currency seized from the apartment at 4131 S. 25th Street, #12 on May 23, 2013; and d. $4,000.00, $727.00 and $680.00 in United States currency seized from Luis Vallejo.
* Francisco Victor Ramon, age 34, of Omaha, is charged with illegal reentry into the United States on or about May 18, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Luke Ross, age 27, and Robert Abbott, age 27, are charged in a four count indictment. Count I alleges that beginning on or about November 2012, and continuing to on or about May 22, 2013, the defendants conspired together and with others to distribute and possess with intent to distribute 500 grams or more of a mixture or substance containing methamphetamine. The maximum possible penalty includes imprisonment of not less than 10 years and up to life, a $10 million fine, a 5 year term of supervised release, and a $100 special assessment. Count II alleges that on or about May 22, 2013, Luke Ross possessed with intent to distribute 5 grams or more of actual methamphetamine. The maximum possible penalty is imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment. Count III of the indictment alleges Roger Abbott , distributed a mixture or substance containing a detectable amount of methamphetamine on or about May 9, 2013. The maximum possible penalty is imprisonment of up to 20 years, a $2 million fine, a 5 year term of supervised release and a $100 special assessment. Count IV alleges that on or about May 9, 2013, Roger Abbott possessed a Beta Arms 9mm handgun during and in relation to, and in furtherance of the drug trafficking offense alleged in Count I. The maximum possible penalty is imprisonment of not less than 5 years and up to life to be served consecutive to any other sentence imposed, a $250,000 fine, a 5 year term of supervised release and a $100 special assessment. The indictment also alleges any and all property constituting or derived from any proceeds obtained directly or indirectly as a result of the violations alleged in the indictment should be forfeited to the United States, including but not limited to: a. $563.00 in United States currency seized from the person of Roger Abbott on May 9, 2013; b. $8,326.00 in United States currency seized from the person of Luke Ross on May 22, 2013; c. A bronze 2006 Jeep Commander VIN # 1J8HG58286C302444, driven and owned by Luke Ross.
* Rogelio Sotelo-Arizmendi, age 26, of Nampa, Idaho, is charged with illegal reentry into the United States on or about June 4, 2013, following deportation as an aggravated felon. The maximum possible penalty if convicted includes imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Daniel Stratman, age 23, of Lincoln, is charged in a twelve count indictment. Counts I and II allege that on or about March 23, 2013 and on or about March 24, 2013, Stratman knowingly caused the transmission of a program, information, code, and command, and, as a result of such conduct, intentionally caused damage without authorization to a protected computer, to wit, the University of Nebraska and Nebraska State College Systems computer systems. The maximum possible penalty for these counts includes imprisonment of 10 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Counts III through XII of the indictment allege that on various dates the defendant intentionally exceeded authorized access to a computer, and thereby obtained information from a protected computer. The maximum possible penalty for each count includes imprisonment of 1 year, a $100,000 fine, a 1 year term of supervised release and a $100 special assessment.
Manuel Vidal-Gomez, age 30, of Omaha, is charged with illegal reentry into the United States on or about September 23, 2012, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
Contact Criminal Chief Jan Sharp at 402-661-3700 for further information.
* Cesar Verdusco-Lugo, age 39, of Grand Island, Nebraska, is charged with illegal reentry into the United States on or about May 6, 2013, following deportation as a felon. The maximum possible penalty if convicted includes imprisonment of 10 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Matthew Wedlock , age 25, of Omaha, is charged with conspiring with others beginning on or about December, 2011 and continuing to on or about December, 2012, to distribute and possess with intent to distribute Oxycodone, a Schedule II narcotic controlled substance. The maximum possible penalty is imprisonment of up to 20 years, a $1,000,000 fine, a 5 year term of supervised release, and a $100 special assessment.Joplin Man Sentenced to 50 Years in Prison for Producing Child PornRead the Press Release
Project Safe Childhood
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Joplin, Mo., man has been sentenced in federal court for producing child pornography.
Jason Dewayne Beshears, 31, of Joplin, was sentenced by U.S. District Judge Dean Whipple on Friday, June 21, 2013 to 50 years in federal prison without parole. The court also ordered Beshears to pay $10,000 in restitution to his victim, and sentenced Beshears to spend the rest of his life on supervised release after completing his prison term.
On Sept. 6, 2012 Beshears pleaded guilty to eight counts of producing child pornography. Beshears admitted that he exploited a minor victim over a one-year period to produce digital videos of child pornography. Beshears is charged with exploiting a minor to produce child pornography on Aug. 28, 2010 and on seven more occasions between May 5 and Aug. 9, 2011.
Joplin police officers were called to Beshears= apartment at about 10 p.m. on Aug. 9, 2011 in response to a complaint that a man found his 4-year-old daughter inside Beshears’s bedroom with the door shut. Beshears was taking pictures of the child. Her father removed her from the room went back to confront Beshears, but when he returned to the room, Beshears was gone. Joplin police officers located Beshears about a block away, attempting to leave in a taxi, and took him into custody. Beshears admitted to officers that he had sexually assaulted the 4-year-old child and had previously filmed this type of activity.
More than 600 images of child pornography were recovered from Beshears’s digital media. Investigators conducted a forensic examination of Beshears= laptop computer and found a large quantity of video files of various forms of sexual abuse being conducted by Beshears on the child victim, as well as numerous images of child erotica. The video files were downloaded to Beshears= laptop from March 2010 to Aug. 9, 2011. Investigators also found more than 20 photos and three videos of sexual abuse being conducted by Beshears on the child victim, which were dated Aug. 9, 2011, on his Panasonic digital camera.
Beshears must forfeit to the government two laptop computers, an Apple iPhone and a digital camera that were used to commit the offenses.
This case was prosecuted by Supervisory Assistant U.S. Attorney Michael S. Oliver. It was investigated by the Joplin, Mo., Police Department, the Southwest Missouri Cybercrimes Task Force and the FBI.
Project Safe Childhood
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."John Threadgill Sentenced to Serve 51 Months in Prison for Tax EvasionRead the Press Release
KNOXVILLE, Tenn. – John Oliver Threadgill, 70, of Knoxville, Tennessee, was sentenced on June 24, 2013, by the Honorable Thomas W. Phillips, U.S. District Court Judge, to serve 51 months in federal prison. In addition, he was ordered to pay restitution to the Internal Revenue Service in the amount of $3,569,200.90.
Threadgill was indicted on June 21, 2011, and charged with one count of income tax evasion. He was convicted on November 11, 2012, following a five-day jury trial.
According to the indictment, Threadgill failed to pay more than $1.4 million in tax to the Internal Revenue Service (IRS) for numerous tax years from 1985 through 2004. The indictment further alleged that Threadgill, an attorney, used his law firm bank account and payroll account to pay for personal expenditures, opened bank accounts in the names of nominee trusts, and titled his personal residences in the names of nominee trusts.
During the trial, the United States presented evidence of Threadgill’s earnings, along with proof that he spent more than $909,000 in personal expenditures, including $69,000 for a wedding, $245,000 for family educational expenses, $60,000 for country club expenses, $52,000 for personal travel, and $213,000 for personal real estate, with funds that could have been used to pay his taxes. The United States also offered proof that Threadgill had evaded the payment of his taxes through disguising the personal nature of his assets and by placing real estate in the names of nominee trusts.
“Every person should know that, regardless of your stature, you will be prosecuted for violating the criminal income tax laws. This sentence should serve as a deterrent to other potential tax defrauders,” said U. S. Attorney Bill Killian.
This investigation was conducted by the Internal Revenue Service Criminal Investigation. Assistant United States Attorney Frank M. Dale, Jr. represented the United States.
Informational: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on June 24, 2013, before U.S. Magistrate Judge Carolyn S. Ostby, the following individuals were arraigned:
KARRIE MARIE STOLTENBERG, a 39-year-old resident of Billings, appeared on a charge of possession with the intent to distribute methamphetamine. She is currently detained. If convicted of this charge, STOLTENBERG faces possible penalties of a mandatory minimum of 5 years and could be sentenced to 40 years, a $5,000,000 fine, and 4 years supervised release. Assistant U.S. Attorney Brendan P. McCarthy is the prosecutor for the United States. The investigation was conducted by the Federal Bureau of Investigation Task Force.
JAMIE LYNN STROSKY, a 33-year-old resident of Shepherd, appeared on charges of conspiracy to possess with the intent to distribute, possession with the intent to distribute methamphetamine, and distribution of methamphetamine. She is currently detained. If convicted of these charges, STROSKY faces possible penalties of a mandatory minimum of 5 years and could be sentenced to 40 years, a $5,000,000 fine, and 4 years supervised release. Assistant U.S. Attorney Brendan P. McCarthy is the prosecutor for the United States. The investigation was conducted by the Federal Bureau of Investigation Task Force.
The defendants pled not guilty to the charges.
The charge, an indictment, information or complaint, is merely an accusation and all persons named as defendants are presumed innocent until proven guilty. A pre-trial conference and a trial date will be set and the United States will be required to prove the allegations set forth in the indictment beyond a reasonable doubt.
Illegal Alien Found in Altoona to Be Returned to MexicoRead the Press Release
JOHNSTOWN, Pa. - A citizen of Mexico entered a plea of guilty to a one-count indictment and has been sentenced in federal court to two months in prison, no supervised release, and ordered immediately turned over to the custody of the United States Immigration and Customs Enforcement for deportation to Mexico on his conviction of re-entry of a removed alien, United States Attorney David J. Hickton announced today.
United States District Judge Kim R. Gibson imposed the sentence on Juan Raymundo Martinez-Alba, 28.
According to information presented to the court, on April 10, 2013, Martinez-Alba, an alien who had been deported from the United States on Dec. 4, 2008, was found in Altoona, Pa. He had unlawfully re-entered this country without receiving permission from the Secretary of the Department of Homeland Security to do so.
Assistant United States Attorney John J. Valkovci, Jr., prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Department of Homeland Security/Immigration and Customs Enforcement for the investigation leading to the successful prosecution of Martinez-Alba.
Gun Dealers Sentenced to Prison for Manufacture, Possession and Sale of Illegal Machine GunsRead the Press Release
PHOENIX, Ariz. – On June 20, 2013, Randolph Benjamin Rodman, 60, of Crownsville, Md., and Idan C. Greenberg, 59, of Glendale, Ariz., both licensed gun dealers, were sentenced by U.S. District Chief Judge Roslyn O. Silver to 121 months and 33 months in prison, respectively. On Dec. 20, 2012, Rodman was found guilty by a federal jury of 22 charges including conspiracy; illegal possession of a machine gun; obliterating the serial numbers of firearms; the manufacturing, possession, receipt and transfer of machine guns in violation of the National Firearms Act (NFA); and making false entries on applications and records.Greenberg was found guilty by the same federal jury of four charges involving conspiracy; illegal possession of a machine gun; receipt and possession of a firearm transferred in violation of the NFA; and receipt and possession of a firearm made in violation of the NFA.
“Enforcement of gun laws, particularly the regulation of machine guns, is essential to public safety. The defendants’ convictions and sentences demonstrate our commitment to prosecute those who violate gun laws, including licensed gun dealers,” said U.S. Attorney, John S. Leonardo.
"This was a very challenging and complicated investigation involving machine guns (NFA weapons) and fraud. These Federal Firearms Licensees violated the public’s trust and defrauded countless customers of their NFA weapon purchases. I hope their lengthy sentences serve notice to those that might consider committing the same criminal acts," stated ATF Special Agent in Charge, Thomas Atteberry.
Between Sept. 22, 1993, and continuing through April 8, 2009, Rodman and Greenberg conspired with other persons to defraud the United States in its regulations of machine guns, including the 1986 machine gun ban. In order to circumvent the machine gun regulations, the defendants had the serial numbers from over 30 inexpensive, registered machine guns cut-off and welded onto completely different and more expensive models of machine guns that were illegally manufactured. The defendants would then transfer or sell the newly manufactured illegal machine guns by falsely utilizing the registration of the original machine gun.
The investigation in this case was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The prosecution was handled by Kathy J. Lemke, Assistant U.S. Attorney, and James P. Vann, Special Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-10-001047-PHX-ROS
RELEASE NUMBER: 2013-046_Rodman&GreenbergFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Gallup Man Pleads Guilty to Federal Second Degree Murder ChargeRead the Press Release
ALBUQUERQUE – Thomas Benally 53, an enrolled member of the Navajo Nation who resides in Gallup, N.M., pleaded guilty this morning to a second degree murder charge under a plea agreement with the U.S. Attorney’s Office.
Benally and his co-defendant, Luke Spencer, 48, a Navajo man who also resides in Gallup, N.M., were indicted in March 2012. Count 1 of the indictment charged Benally with second degree murder and Count 2 charged Spencer with aiding and abetting second degree murder. According to the indictment, Benally, who was aided by Spencer, killed a man while driving under the influence of alcohol on the Navajo Indian Reservation between Oct. 1, 2010 and Oct. 2, 2010.
During this morning’s hearing, Beanlly entered a guilty plea to second degree murder and admitted that on the night of Oct. 1, 2010 or early hours of Oct. 2, 2010, he drove Spencer’s truck despite being severely intoxicated. While backing up, Benally ran over a 71-year-old Navajo man. Benally further admitted that he and Spencer, who was in the passenger’s seat, drove away in the truck without making any effort to check on the victim’s condition or calling the authorities to report the accident. The victim died of injuries he sustained and his remains were found by a passerby on Oct. 7, 2010.
Under the terms of the plea agreement, Benally will be sentenced to a prison term within the range of 10 to 12 years followed by a term of supervised release to be determined by the court. Benally has been in federal custody since his arrest on March 13, 2012 and remains detained pending his sentencing hearing, which has yet to be scheduled.
On May 28, 2013, Spencer entered a guilty plea to a felony information charging him with involuntary manslaughter for permitting Benally to drive his truck while intoxicated. At sentencing, Spencer faces a maximum penalty of eight years in prison. Spencer remains in the custody of the U.S. Marshals Service pending his sentencing hearing which has not yet been scheduled.
This case is being prosecuted by Assistant U.S. Attorneys Jennifer M. Rozzoni and Jack E. Burkhead based on an investigation by the Gallup office of the FBI and the Crownpoint office of the Navajo Nation Division of Public Safety.- Mascheroni Plea Agreement
- Roxby Mascheroni Plea Agreement
Gallup Man Pleads Guilty to Federal Second Degree Murder ChargeRead the Press Release
ALBUQUERQUE – Thomas Benally 53, an enrolled member of the Navajo Nation who resides in Gallup, N.M., pleaded guilty this morning to a second degree murder charge under a plea agreement with the U.S. Attorney’s Office.
Benally and his co-defendant, Luke Spencer, 48, a Navajo man who also resides in Gallup, N.M., were indicted in March 2012. Count 1 of the indictment charged Benally with second degree murder and Count 2 charged Spencer with aiding and abetting second degree murder. According to the indictment, Benally, who was aided by Spencer, killed a man while driving under the influence of alcohol on the Navajo Indian Reservation between Oct. 1, 2010 and Oct. 2, 2010.
During this morning’s hearing, Beanlly entered a guilty plea to second degree murder and admitted that on the night of Oct. 1, 2010 or early hours of Oct. 2, 2010, he drove Spencer’s truck despite being severely intoxicated. While backing up, Benally ran over a 71-year-old Navajo man. Benally further admitted that he and Spencer, who was in the passenger’s seat, drove away in the truck without making any effort to check on the victim’s condition or calling the authorities to report the accident. The victim died of injuries he sustained and his remains were found by a passerby on Oct. 7, 2010.
Under the terms of the plea agreement, Benally will be sentenced to a prison term within the range of 10 to 12 years followed by a term of supervised release to be determined by the court. Benally has been in federal custody since his arrest on March 13, 2012 and remains detained pending his sentencing hearing, which has yet to be scheduled.
On May 28, 2013, Spencer entered a guilty plea to a felony information charging him with involuntary manslaughter for permitting Benally to drive his truck while intoxicated. At sentencing, Spencer faces a maximum penalty of eight years in prison. Spencer remains in the custody of the U.S. Marshals Service pending his sentencing hearing which has not yet been scheduled.
This case is being prosecuted by Assistant U.S. Attorneys Jennifer M. Rozzoni and Jack E. Burkhead based on an investigation by the Gallup office of the FBI and the Crownpoint office of the Navajo Nation Division of Public Safety.
Former Vice President of Bank Receives 42-Month Sentence for EmbezzlementRead the Press Release
United States Attorney Deborah R. Gilg announced that Matthew J. Monheiser, age 38 of Sidney, Nebraska, was sentenced today in Lincoln, Nebraska, to 42 months in prison by United States District Judge John G. Gerrard, for embezzling $1,364,953.66 from the First National Bank in Sidney Nebraska. In addition to the prison term, Mr. Monheiser was ordered to pay full restitution, ($500,000 of which has already been paid), and serve a 5 year term of supervised release upon his release from prison.
Monheiser began working for the First National Bank in Sidney, Nebraska, in 2001. The First National Bank became the Points West Community Bank in 2010. The deposits of both banks were at all times insured by the Federal Deposit Insurance Corporation. At all times Monheiser was an employee of both banks, and became an executive vice president and branch manager of the Points West Community Bank.
Beginning by at least March 1, 2003, and continuing until approximately August, 2012, Monheiser embezzled and stole money from the bank. Monheiser accomplished the theft and embezzlement in three ways. Monheiser used funds from the loan accounts of bank customers to purchase cashier’s checks in the customers’ names, and would then use the proceeds for his own benefit. Monheiser also created loans in the names of bank customers, or increased the amount of existing loans, and used the proceeds for his own benefit. Lastly, he also removed a total of $82,000 in cash from the bank’s vault.
This case was investigated by the Federal Bureau of Investigation.Former Postal Employee Ordered to Prison for Possessing Child PornographyRead the Press Release
HOUSTON – Brice Burns Davenport, 51, of Tomball, has been handed a federal prison sentence for possessing child pornography, United States Attorney Kenneth Magidson announced today. Davenport pleaded guilty March 25, 2013.
Today, U.S. District Judge Lynn Hughes sentenced Davenport to a term of 12 months and one day in prison to be immediately followed by eight years on supervised release during which time he is to receive counseling and must comply with sex offender registration requirements.
The investigation began in July 2012 when Houston postal inspectors received information from their Computer Crimes Unit regarding an apparent attempt to access child pornography via an official U.S. Postal Service (USPS) computer. Specifically, an individual using Davenport’s USPS logon credentials conducted Internet searches consistent with searches for child pornography between the dates of May 17, 2012 - June 20, 2012.
The Computer Crimes Unit monitored Internet traffic on the USPS computer assigned to the Plantersville Post Office where Davenport was employed as the acting postmaster. On or about Oct. 9, 2012, numerous images of apparent child pornography were obtained from the computer. Those images were submitted to The National Center for Missing and Exploited Children for review who reported many contained known child victims who have been previously identified by law enforcement child exploitation investigations.
The investigation revealed Davenport accessed child pornography from the USPS computer located at the Plantersville Post Office. Davenport would enter search terms into the Yahoo image search engine which produced images depicting prepubescent and pubescent minor females and males displaying their genitals in a lewd and lascivious manner. It was determined Davenport was the only user to access the computer in question on dates where child pornography was searched for and found.
Davenport acknowledged using search terms which yielded child pornography. The computer was seized and forensic analysis revealed a total of approximately 52 images of child pornography involving the lascivious display of childrens’ genitals which Davenport found.
USPS - Office of Inspector General investigated.
This case, prosecuted by Assistant U.S. Attorney Robert Stabe, 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."
Former Ozark Man Sentenced for $1.1 Million Retirement Investment SchemeRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a former Ozark, Mo., man has been sentenced in federal court for a $1.1 million investment fraud scheme that targeted the retirement savings of senior citizens.
Steven Edward Gwin, 68, formerly of Ozark, was sentenced by U.S. District Judge Dean Whipple on Friday, June 21, 2013 to nine years in federal prison without parole. The court also ordered Gwin to pay $1,173,267 in restitution to his victims.
On Aug. 20, 2012 Gwin pleaded guilty to mail fraud and money laundering. Gwin, who spent time in Guatemala and used several aliases and multiple Social Security account numbers, was apprehended in Arizona in April 2012 and has been in federal custody since his arrest.
Gwin admitted that he was engaged in a scheme to defraud investors from Aug. 17, 2005, to March 14, 2007. Gwin solicited and obtained funds from individuals for investment in various retirement ventures. Gwin conducted seminars for senior citizens in both Missouri and Arkansas to promote these investment programs. As a result, many of the investors Gwin solicited were elderly.
Gwin represented to the individual investors that he would invest their retirement funds in secure, interest-earning investments. Gwin directed individual investors to establish Individual Retirement Accounts (IRAs) through Sterling Trust Company, a non-bank trust company in Waco, Texas, which provides custodial services on self-directed IRAs. After investors funded their IRA accounts, Gwin transferred the funds to purchase unsecured notes issued by First Nevada Marketing, Inc., a Missouri corporation operated by Gwin.
Gwin spent a portion of the funds on personal items and left investors with losses on their investments.
This case was prosecuted by Assistant U.S. Attorney Randall D. Eggert. It was investigated by the U.S. Postal Inspection Service and IRS-Criminal Investigation.
Former Essex County, N.J., Sheriff’s Officer Admits Collecting A Debt Through ExtortionRead the Press Release
NEWARK, N.J. – A Monmouth County, N.J., man admitted today to conspiring to collect a debt using extortionate means, U.S. Attorney Paul J. Fishman announced.
John Balsamo, 49, of West Long Branch, N.J., pleaded guilty before U.S. District Judge Katharine S. Hayden to an indictment charging him with using threats of violence and economic harm to collect a debt from the victim, an Ocean County, N.J., construction contractor.
According to documents filed in this case and statements made in court:
Balsamo and conspirators Timothy Kelly, 37, of Jersey City, N.J., and Robert C. Bantang, Jr., 44, of Oceanport, N.J., used extortionate means in order to collect $50,000 the contractor owed to Kelly from 2009. The conspirators made the victim believe that the money he had borrowed from Kelly was owed to the “Old Man,” a member of organized crime who would cause physical harm to the victim if the debt was not paid. Balsamo also displayed a key to a construction site where the victim was working in Brick, N.J., and warned that the key could be used to gain access to, and cause damage to the site, due to the victim’s failure to fully repay the debt. Balsamo and Kelly sent Bantang to the construction site on three occasions to deliver threats purportedly on behalf of the “Old Man.”
On March 24, 2011, Balsamo and Kelly went to the Brick construction site, which was now a completed restaurant, to confront the victim. Kelly told the victim that if he had brought his “boys” that it would have gotten “done right in here, right in this place, right like this, in front of everybody . . . and your wife gets it too.” Kelly also told the victim that he deserved “a beatin’ just out of f- - kin’ principle.” Balsamo warned that the “Old Man” wanted to “beat the shit” out of the restaurant owner due to the victim’s failure to repay the debt, which Balsamo and Kelly now stated had grown to $70,000. Balsamo also advised the victim that the “Old Man” has been “promoted,” implying that the “Old Man” now possessed a higher position in organized crime.
During the course of the conspiracy, Balsamo received a Rolex watch and $2,500 in cash from the victim towards payment of the debt.
Kelly and Bantang previously pleaded guilty in February 2012 to conspiring to collect a debt from the victim using extortionate means, before U.S. District Judge Katharine S. Hayden.
The two men are scheduled for sentencing on Sept. 10, 2013.Balsamo faces a maximum potential penalty per count of 20 years in prison and a fine of $250,000. Sentencing is scheduled for Oct. 8, 2013.
Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, and special agents of the N.J., State Commission of Investigation, under the direction of Executive Director Philip James Degnan, for the investigation leading to today’s guilty plea.
The government is represented by Senior Litigation Counsel Leslie F. Schwartz of the U.S. Attorney’s Office Economic Crime Unit in Newark.
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Defense Counsel: John Yauch Esq., Assistant Federal Public Defender, NewarkBalsamo Indictment
Former Cherryville Police Chief Charged with EmbezzlementRead the Press Release
Former Chief “Woody” Burgess Has Agreed To Plead Guilty
CHARLOTTE, N.C. – The former Police Chief for the City of Cherryville has been charged with one count of program embezzlement, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Woodrow Paul Burgess “Woody Burgess,” 60, of Cherryville, N.C. has agreed to plead guilty to the charge.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Greg McLeod, Director of the State Bureau of Investigation (NC SBI) join U.S. Attorney Tompkins in making today’s announcement.
According to the criminal bill of information and plea agreement filed today in U.S. District Court, Burgess was the Chief of Police for the City of Cherryville until his retirement in October 2012. During the relevant time period, Bonny Alexander, was Cherryville’s Finance Director, and had authority to process payroll payments to Cherryville employees, direct payments for city expenses and issue checks on behalf of the city. According to court records and the filed plea agreement, Burgess embezzled and caused Alexander to embezzle approximately $11,048 of the city’s funds. Court records show that beginning in January 2007 through November 2008, Burgess instructed Alexander to issue approximately nine Cherryville city checks payable to “The Great Outdoors, Inc.” for the purchase of firearms for Burgess’ personal use. According to the charging document, Burgess told Alexander that the checks and the expenditure of the City’s funds for personal use had been authorized as a “cash-out” for “compensatory time.” Court records indicate that Alexander issued the checks as requested by Burgess and placed entries in the City’s accounting records that the expenditures were for a certain amount of “sick time” or “comp time” due to “Woody.” According to court documents, Burgess was aware that he was not entitled to cash payments for sick or vacation leave or compensatory time. In addition, Burgess knew that no hours were deducted from his sick or vacation leave balances for the City’s purchase of guns for his personal use.
The bill of information contains a notice of forfeiture, which gives notice that the defendant must forfeit to the United States all property and currency involved in the offense charged in the charging document, and all property and currency which are proceeds of such offense, including approximately $8,490 in cash, and three firearms seized during the course of the investigation.
“Woody Burgess was sworn to uphold the law but instead thought he was above the law. While prosecuting a law enforcement officer is always difficult, my Office will not allow the likes of Woody Burgess to dishonor the uniform proudly worn by all other Cherryville police officers who are dedicated to serving and protecting their community,” said U.S. Attorney Tompkins.
“It is both disappointing and disheartening to learn a senior law enforcement officer took advantage of his trusted position for his own profit. Public corruption is the number one criminal priority of the FBI and we will continue to work aggressively to hold public officials of all levels accountable, especially those who erode the public’s trust in those who have sworn to protect and serve others,” said Special Agent in Charge John A. Strong, of the FBI in Charlotte.
“Our agents are dedicated to finding the truth and bringing criminals to justice, and this case is an excellent example of the work that they do,” said SBI Director Greg McLeod. “We’ll continue our efforts to solve crime, root out public corruption, and protect the people of North Carolina.”
Burgess has agreed to plead guilty to one count of program embezzlement, which carries a maximum sentence of 10 years in prison, a $250,000 fine, or both. Burgess’ initial appearance and plea hearing have been set for Tuesday, June 25, 2013, at 2:00 p.m. According to the filed plea agreement, Burgess has also agreed to pay full restitution the amount of which will be determined by the Court at sentencing.
In January 2013, Alexander pleaded guilty to five counts of program embezzlement for stealing over $435,000 from the City of Cherryville. She faces a maximum term of 10 years in prison and a $250,000 fine per count. A sentencing date for Alexander has not been set yet.
The investigation is handled by the FBI and SBI. The prosecution is handled by Michael Savage, of the U.S. Attorney’s Office in Charlotte.
Former Assistant Middle School Coach Sentenced to Prison for Possessing Child PornographyRead the Press Release
BIRMINGHAM – A federal judge today sentenced a former Homewood middle school coach and elementary school special education aide to more than eight years in prison for possessing child pornography, announced U.S. Attorney Joyce White Vance and Alabama Department of Public Safety Director Hugh B. McCall.
U.S. District Judge Inge P. Johnson sentenced JOSHUA DAVID STATUM, 26, of Pelham, to eight years and one month in prison for possessing 1,875 images of child pornography in 2011 and 2012. Statum pleaded guilty to the charge in March. He must serve five years of supervised release after completing his prison term.
Among the videos Statum possessed and distributed on a peer-to-peer file-sharing computer software program was one showing a little girl, less than 12 years old, being sadistically sodomized and raped, and another showing a 5-year-old girl performing sexual acts, according to court documents.
While Statum was working as an assistant wrestling and football coach at Homewood Middle School and as a special education aide, he was viewing and sharing child pornography over the Internet, according to the government's sentencing memorandum. "This defendant did not just look at a few images once in his life, but used file sharing computer technology to distribute images of prepubescent children being sodomized and raped and also to possess thousands of images of children be similarly exploited," the memorandum states.
The Alabama Bureau of Investigation investigated the case. Assistant U.S. Attorney Daniel J. Fortune prosecuted the case.
Final Defendant Sentenced in Ten-Person OCDETF ConspiracyRead the Press Release
BOISE – U.S. Attorney Wendy J. Olson announced that the final member of a ten-defendant southwest Idaho methamphetamine trafficking conspiracy was sentenced today in federal court in Boise. Samuel Chavez, 33, was sentenced to 66 months in federal prison for the crime of possession with intent to distribute in excess of 50 grams of methamphetamine. Chief U.S. District Judge B. Lynn Winmill also sentenced Chavez to three years of supervised release. He pleaded guilty on March 20, 2013.
According to court documents, beginning in January 2011, and continuing through December 16, 2011, Chavez participated in drug transactions with the lead defendant, Alfredo Dominguez-Villareal, distributing cocaine and fifty grams or more of methamphetamine. On one occasion Chavez traded an AK-47 and ammunition for methamphetamine.
Nine members of the conspiracy have pleaded guilty and have been sentenced: Alfredo Dominguez-Villareal, a/k/a Alfredo Vasquez-Dominguez, a Mexican national, to 150 months in prison; Nelson Fernando Garcia-Soto, a Mexican national, to 148 months; Alonso Martinez, of Earlimart, California, to 60 months; Jimenez Valencia a/k/a Jorge Jimenez, a Mexican national, to 57 months; Juan Carlos Arredondo-Sicairos a/k/a Victor Kalil Medina-Feliciano, a Mexican national, to 120 months; Delia Garcia-Pineda, a Mexican national, to 37 months; Tanna Spencer, of Parma, Idaho, to 15 months; Hector Morales, of Delano, California, to six months; and Cynthia Casillas, also of Delano, to three years’ probation.
The case was the result of a joint investigation of the Organized Crime and Drug Enforcement Task Force (OCDETF), led by the Drug Enforcement Administration in conjunction with the Boise Police Department and the Ada County Sheriff's Office. The OCDETF program is a federal multi agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. Federal task force members include the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration (DEA), the Federal Bureau of Investigation (FBI), Internal Revenue Service-Criminal Investigation, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), and U.S. Marshals Service.
Drug Dealer Who Imported Cocaine Hidden in Flip Flops Sentenced to over 15 Years in PrisonRead the Press Release
Greenbelt, Maryland - U.S. District Judge Roger W. Titus sentenced Lorenzo Solomon, age 28, of Baltimore, Maryland, today to 188 months in prison, followed by four years of supervised release, for a conspiracy to import cocaine from St. Vincent and distribute it in Maryland. Judge Titus enhanced Solomon’s sentence upon finding that he was a leader of the conspiracy and that he obstructed justice by attempting to intimidate witnesses to prevent them from testifying truthfully against him at trial.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge William Winter of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); U.S. Customs and Border Protection Baltimore Port Director Ricardo Scheller; and the agencies participating in the Metropolitan Area Drug Task Force.
According to the evidence presented at Solomon’s four day trial, Solomon served as the leader and organizer of a conspiracy involving Ronnie George and others to import cocaine from St. Vincent and distribute that cocaine in Maryland. Between April and December 2010, Solomon arranged with coconspirators located in St. Vincent to send him packages containing up to a kilogram of cocaine at a time hidden in the soles of flip-flop style slippers, both to his own address and to the address of others. Once Solomon retrieved the packages, he would remove the cocaine and sell the cocaine to others in Maryland who would then distribute it.
To pay for the drugs, witnesses testified that Solomon arranged to have multiple friends and family members send large amounts of cash via Western Union and Moneygram, most frequently in $2,000 increments, which Solomon provided them. Solomon recruited coconspirator Ronnie George to send money on his behalf. In addition to providing him cash to send to St. Vincent, Solomon provided George several hundred dollars in cash or merchandise as compensation for sending money. Solomon suggested that George recruit friends to send money to reduce the chance of the scheme being detected, which he did. Solomon also recruited his sister, girlfriend and others to send money to St. Vincent for him. According to court documents, more than 17 individuals sent a total of $117,270 from the U.S. to St. Vincent between April and November 2010.
According to trial testimony, on November 26, 2010, Customs and Border Protection (CBP) officers intercepted package of cocaine-filled flip flops intended for Solomon, but addressed to a friend. CBP transferred the package to the Metropolitan Area Drug Task Force to attempt a controlled delivery of the package to the Takoma Park address listed on the package. After unsuccessfully attempting to deliver the package on December 6, 2010, law enforcement left a note on the door advising of the attempted delivery of the package and providing a telephone number to call to arrange delivery. Witness testimony showed that Solomon was advised of the arrival of the package and at Solomon’s direction, delivery of the package was arranged for the next day. After the package was delivered, phone records show that a call was placed to Solomon to let him know of the delivery. A short time later, HSI agents executed a search warrant, recovering the drugs. Ronnie George was also arrested after he arrived to pick up the package for Solomon.
Solomon left the area, eventually traveling to St. Vincent, where, in February 2011, he filed paperwork with the St. Vincent government to form a business, apparently in an effort to create a cover story as to why he had sent so much money to St. Vincent. Solomon returned to the United States in March 2011. On April 6, 2011, George and Solomon were indicted on drug conspiracy charges. George was arrested and pleaded guilty, but Solomon was not located until after George’s sentencing in March 2012.
According to witness testimony, Solomon requested that a witness change her story so as not to implicate Solomon in the drug conspiracy, but the witness refused. Evidence was also presented that during preparation for trial several witnesses contacted law enforcement to advise that they or members of their family were being threatened to prevent the witness’ testimony against Solomon. As a result of these threats, Judge Titus ordered that Solomon be taken into custody on the first day of his trial, March 12, 2013, and he has been detained since that time.
Ronnie George, age 27, of Owings Mills, Maryland pleaded guilty to his participation in the drug conspiracy and was sentenced to a year and a day in prison.
United States Attorney Rod J. Rosenstein commended HSI Baltimore, U.S. Customs and Border Protection and the agencies participating in the Metropolitan Area Drug Task Force for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Kristi N. O’Malley and Adam K. Ake, who prosecuted the case.
Diamond Bar Man Who Ran Day-Trading Ponzi Scheme That Caused over $30 Million in Losses Sentenced to over 12½ Years in PrisonRead the Press Release
LOS ANGELES – The CEO and co-owner of a Diamond Bar investment company was sentenced this morning to 151 months in federal prison for enticing investors to put $49 million into his bogus day-trading venture as part of a Ponzi scheme that caused more than $30 million in losses.
Syed Qaisar Madad, 66, of Diamond Bar, was sentenced to 151 months in prison by United States District Judge Percy Anderson. At the conclusion of today’s hearing, Judge Anderson remanded Madad into the custody of the United States Marshal.
During the sentencing hearing, Judge Anderson said that Madad, who had emigrated to the United States in 1972, had squandered the “priceless treasure” of becoming a lawful resident of this country by not fulfilling his “obligation and responsibility to respect the rule of law.”
Judge Anderson will hold a restitution hearing on August 12 to establish the amount Madad should repay his victims, a figure prosecutors believe should be approximately $32.7 million.
Madad pleaded guilty in February to wire fraud and tax fraud, admitting in court that investors lost more than $30 million when his scheme collapsed in March 2011.
Madad, a native of Pakistan, formed Technology for Telecommunication and Multimedia, Inc. (TTM) in 1993, and by 2005 Madad was using the company to tout his alleged mastery as an investor. Friends, family and professional colleagues of Madad – as well as associates of his wife, a medical doctor who operated a practice in Lynwood – entrusted their money to Madad, who promised to use a day-trading strategy that would generate consistent, substantial profits. However, over the course of a 5½-year scheme, Madad’s investments resulted in losses of more than $9 million.
Notwithstanding these significant losses, Madad sent victims monthly account statements that always showed gains in their TTM accounts. These detailed account statements falsely reassured victims that their investments were safe and increasing in value. Some victims gave Madad additional funds based solely on these fictitious account statements. In October 2009, for example, Madad reported that the value of all the investments being held by TTM was more than $50 million – but TTM’s assets at the time were only $825,000, notwithstanding the fact that investors had deposited at least $1.2 million during that month. The daily profit reported on the statements sent to investors was also false. Madad would simply decide on the amount of profit to be claimed for each day covered by the statement, and then allocate the purported profit to all of the investors on a pro rata basis.
Madad also falsely promised investors that he would not take any fees or compensation for managing the invested funds. Madad admitted in court that he spent well over $15 million of investors’ money on personal expenses, including real estate, jewelry for his wife and daughters, vehicles, and cash disbursements to himself and family members. As detailed in the prosecutors’ sentencing brief, these expenditures included the purchase of a 5.25-carat diamond ring and a $180,000 sapphire and diamond necklace; a $600,000 down payment on a house for his daughter; and approximately $6 million to pay personal credit cards bills – including charges for numerous luxury items. Madad also used $1.3 million of investor money to pay for improvements to his personal residence, and an additional $1 million of victim money to purchase an empty lot next door.
The investors were also reassured by Madad’s prominence in his community, which he enhanced with interviews and profiles in media serving Pakistani-Americans. During these interviews, Madad touted his day-trading technique, which he claimed was always profitable. Madad used victims’ money to make contributions to numerous charities in Pakistan, India, Egypt and the United States. More than $1 million donated to charity and U.S. political figures was money that Madad misappropriated from victims. Many of the victim-investors were invited to fundraisers and other events that Madad hosted, including a dinner with former Pakistan President General Pervez Musharref at Madad’s home in Diamond Bar.
Although Madad returned approximately $17.7 million to investors, much of this was through Ponzi payments, meaning that the money came from funds entrusted to him by other investors, rather than from profits or interest he had earned.
“Nothing can account for defendant’s criminal conduct other than arrogance and greed,” prosecutors wrote in a sentencing brief.
Madad’s scheme collapsed in March 2011 when one investor asked for his money back and Madad was unable to return it. Madad claimed that the investor’s money was in UBS accounts in Switzerland, which he attempted to corroborate with “account statements.” However, these statements were fake, and prosecutors established at the sentencing hearing that Madad created them himself in an effort to cover-up his scheme. The significant sentence that Judge Anderson imposed today was partially based on the fact that Madad attempted to obstruct justice by giving these phoney UBS statements to the government in an effort to derail its investigation.
More than 40 victims attended the hearing this morning, with six of them addressing the Court and explaining that their losses represented life savings that they had hoped to use to pay for their children’s education and their own retirement. Madad was also sentenced today for his conviction on tax fraud charges for failing to report the income he generated from the Ponzi scheme. Madad admitted in court that he under-reported his income for tax year 2009 by approximately $4.9 million on tax returns filed with the Internal Revenue Service, and the government established that Madad had under-reported his income for tax years 2007-2008 and 2010 by an additional $9.4 million.
Judge Anderson emphasized the deterrent effect of the sentence he imposed today. “The tax system and our system of justice rely on honesty and the good faith of the American public,” the judge said. “The integrity of these systems rests on deterrence.”
Prior to and following Madad’s arrest in October 2012, pursuant to court-authorized warrants, the government seized a Mercedes-Benz C63, numerous pieces of diamond and other precious gemstone jewelry, and funds that were traceable to investor money. The government has also recovered the victim money donated to some of the charities. As part of his agreement with the government, Madad has agreed to forfeit his Diamond Bar mansion, the Mercedez-Benz, 68 pieces of jewelry, and other luxury items, including silk and wool handmade Turkish carpets. Madad also agreed to pay the IRS approximately $5 million in unpaid taxes for tax years 2006 through 2010.
The case against Madad is the result of an investigation by the Federal Bureau of Investigation and IRS - Criminal Investigation.
Release No. 13-084