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21 May 2013
Three Admit Conspiracy to Commit KidnappingRead the Press Release
United States Attorney Laura E. Duffy announced that Antonio Zermeno Garcia entered a guilty plea in federal court in San Diego today to count one of an indictment charging him and co-defendants Luis Miguel Salas Rodriguez and Carlos Alberto Andrade-De La Cruz with conspiracy to commit kidnapping, in violation of Title 18, United States Code, Section 1201(c). Co-defendants Luis Miguel Salas Rodriguez and Carlos Alberto Andrade-De La Cruz previously entered guilty pleas to the same charge on April 26, 2013.
In connection with the entry of their guilty pleas, the defendants admitted that, in March 2012, they devised a plan to kidnap three individuals who owed them money for narcotics trafficking. They further admitted they planned to kidnap the individuals in San Diego, California and transport them to Tijuana, Mexico. Defendant Andrade-De La Cruz further admitted that he was an organizer and leader of this kidnapping conspiracy and that he illegally crossed into the United States on March 14, 2012 in 2 order to locate the first victim with the assistance of Defendants Salas Rodriguez and Zermeno Garcia.
Defendants Luis Miguel Salas Rodriguez and Carlos Alberto Andrade-De La Cruz are scheduled to appear before United States District Judge William Q. Hayes for sentencing on July 29, 2013, at 9:00 a.m.
Defendant Antonio Zermeno Garcia’s plea is subject to final acceptance by Judge Hayes at or before sentencing on August 12, 2013, at 9:00 a.m.
DEFENDANTS Criminal Case No. 12CR1244WQH Antonio Zermeno Garcia
Luis Miguel Salas Rodriguez
Carlos Alberto Andrade-De La Cruz SUMMARY OF CHARGESConspiracy to Commit Kidnapping, in violation of Title 18 United States Code, Section 1201(c) Maximum penalties: Life in Prison, $250,000 fine, $100 Special Assessment, 5 years of Supervised Release
INVESTIGATING AGENCYFederal Bureau of Investigation – Cross Border Violence Task Force
Ten Men Charged in Birmingham Area Heroin and Cocaine Trafficking RingRead the Press Release
Williams et al Indictment.pdf
Prosecutors Seek to Dismiss One Defendant from Drug Conspiracy Indictment
BIRMINGHAM – Federal agents and Jefferson County Sheriff’s deputies working with the U.S. Attorney’s Office today arrested eight men and are searching for a ninth who are charged in a drug-trafficking conspiracy that brought about $5 million worth of heroin and cocaine into the Birmingham area in less than a year, according to an indictment unsealed following the arrests.
U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr., Internal Revenue Service Criminal Investigation Division Special Agent in Charge Veronica Hyman-Pillot, Jefferson County Sheriff Mike Hale and federal Bureau of Alcohol, Tobacco, Firearms and Explosives Special Agent in Charge Jeff Fulton announced the arrests, which resulted from a joint investigation that began in 2011 to combat large-scale narcotics trafficking in western Birmingham and Jefferson County.
The investigation focused on BILLY “Champ” WILLIAMS Jr., now charged as a large-scale heroin and cocaine distributor in western Birmingham, and his network of operators. For more than a year, the FBI gathered evidence exposing an extensive drug-trafficking operation. The investigation culminated with the Jan. 25 arrest of SAMMUEL DEWAYNE “Rosé” GULLEY, 28, of Fairfield, identified as a key member of the organization. Gulley was arrested in possession of two kilograms of nearly pure heroin following a high-speed chase with Jefferson County Sheriff’s deputies. Later that night, agents seized one and a half kilograms of cocaine from a home associated with Williams and Gulley.
“In 2012, the Birmingham area found itself awash in heroin overdose deaths. A drug that no one expected to experience a rebirth began claiming the lives of young people, people in their 20s, 30s, and even their teens,” Vance said. “There were at least 78 overdose deaths in Jefferson and Shelby counties, and perhaps an equal number of cases where overdose death was averted by the swift action of emergency medical technicians” she said. “This investigation puts drug traffickers on notice that we are going to wipe out this epidemic and that criminal networks that profit from the sale of these deadly and highly addictive substances will not be tolerated. Law enforcement at all levels engaged in a highly coordinated effort in this case and we intend to employ the full force of law and justice to investigate and prosecute drug trafficking.”
“The arrests made in this investigation highlight the great work being done by the North Alabama Safe Streets Task Force and is a clear example of the determination and collaborative spirit among area law enforcement agencies to dismantle criminal enterprises that pose the most significant threat,” Schwein said.
“Asset forfeiture is a vital tool in disrupting criminal organizations by depriving them of property used or acquired through illegal activities,” Hyman-Pillot said. “We are proud to have contributed our financial expertise in order to dismantle the drug-trafficking operation that has been targeting Jefferson County citizens for the past year.”
“This case took a lot of hard work and cooperation between our agencies, and every bit of the time and effort was worth it,” Hale said. “These are the kinds of dangerous drug dealers whose dealings are literally killing people, not to mention all of the spin-off violent crime they are responsible for. I want to personally thank all involved in helping remove them from our streets. Jefferson County is a safer place with them locked away, no doubt,” he said.
“This indictment is the culmination of a lengthy investigation,” Fulton said. “This investigation is more evidence that ATF’s commitment to combating violent crime is unwavering. We will utilize every resource to make our communities safer places to live.”
The eight people arrested today on conspiracy or drug distribution charges in a 41-count April 2013 indictment were:
WILLIAMS, 40, of Midfield; WALTER “Walt T” JOHNSON, 47, and WILBERT CURTIS “Bing” DALTON JR., 41, both of Dolomite; GRADY ISAM “Shady Grady” JENKINS, 46, twin brothers DEANDRE R.“Laray” or “Tojo,” MURRELL and DEALDRE R. “Twin” MURRELL, 27, and MARION “Tuna” REYNOLDS JR., 52, all of Birmingham; and VERNON LLWELLYN “RJ” MCADORY, 38, of Bessemer.
Authorities are still searching for ABE “Cuz” JOHNSON, 49, of Birmingham.
Nine of the 10 defendants – all but Dalton -- are charged with conspiracy to distribute heroin and cocaine between May 2012 and April 2013 in Jefferson County. Four counts of the indictment charge various defendants with distributing or possessing with intent to distribute either heroin or cocaine. Jenkins and Dalton are charged with distributing heroin on Nov. 28, 2012. Williams and Gulley are charged with two counts of possession with intent to distribute narcotics on Jan. 25, 2013, one count for a kilogram or more of heroin and one count for 500 grams or more of cocaine. Jenkins faces one count of distributing heroin on April 9, 2013.
The remaining 36 counts charge use of a telephone to facilitate drug trafficking. The 36 counts correspond to individual phone calls made between Oct. 18, 2012, and Jan. 25, 2013. According to the indictment, all the calls involve Williams. Along with Williams, other defendants charged with drug-trafficking phone calls are: Gulley, 12 counts; Walter Johnson, five counts; Deandre Murrell and Jenkins, four counts each; Dealdre Murrell, three counts; Reynolds and Abe Johnson, two counts each; and McAdory, one count.
The drug conspiracy count carries a sentence of 10 years to life in prison. The charge of possessing with intent to distribute heroin carries a maximum penalty of 20 years in prison and a $1 million fine. The charge of possessing with intent to distribute a kilogram or more of heroin carries a maximum penalty of life in prison and a $10 million fine. The charge of possessing with intent to distribute 500 grams or more of cocaine carries a maximum penalty of 40 years in prison and a $5 million fine. The charge of using a telephone to facilitate drug trafficking carries a maximum penalty of four years in prison and a $250,000 fine on each count.
The FBI, IRS-CID and Jefferson County Sheriff’s Office investigated the case, with assistance from ATF and the Birmingham and Hueytown police departments. Assistant U.S. Attorney Gregory R. Dimler is prosecuting the case.
The public is reminded that an indictment contains only charges. A defendant is presumed innocent of the charges and it is the government’s responsibility to prove the defendant’s guilty beyond a reasonable doubt.
Staten Island Man Pleads Guilty to $82 Million Check Kiting ScamRead the Press Release
BROOKLYN, NY – Staten Island, New York, resident Saquib Khan, 51, waived indictment and pleaded guilty today to charges that he engaged in a bank fraud scheme that netted approximately $5 million from six New York City area banks insured by the Federal Deposit Insurance Corporation (“FDIC”). To implement his scheme, the defendant transferred more than $82 million among various bank accounts, using a complex web of worthless checks, which the banks initially credited, and wire transfers to cover his tracks. Khan pleaded guilty to eight counts of bank fraud and agreed to forfeit all of the proceeds of his fraud to make the banks whole. The defendant faces up to 30 years imprisonment on each count, as well as a $1,000,000 fine and restitution.
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
According to court documents, from November 2012 through December 2012, Khan, a businessman who owned and operated a wholesale cigarette and grocery business, as well as delicatessens in Staten Island, wrote checks for more than $82,000,000 from various bank accounts under his control. Those accounts did not have sufficient funds to cover the checks. However, upon depositing the worthless checks, the victim banks provided immediate credit for the entire amount of the checks even though the checks had not yet cleared. To cover these worthless checks, Khan wired most of the fraudulently obtained funds from the deposit accounts back to the accounts upon which they were drawn. During each round of these ever-increasing checks and wires, Khan withdrew a portion of the money. In this manner, Khan fraudulently extracted approximately $5 million from the victim banks in less than two weeks.
“As demonstrated by the bank fraud charges and the admissions at his guilty plea, Khan’s greed was matched only by his nerve. But law enforcement promptly shut down Khan’s $82 million check-kiting scheme, and he has now been brought to justice. We are committed to protecting the integrity of our banking system and protecting the public from the effects of fraud,” stated United States Attorney Lynch. “I would like to thank our partners at the FBI for their swift action and effective work on this important investigation. ”
FBI Assistant Director-in-Charge Venizelos stated, “As alleged, and as he has admitted, Khan was a con man. Taking advantage of the banks’ policy of crediting deposited checks before they clear, he stole approximately $5 million. What the scheme likely earned him in the long run is a significant prison term.”
The defendant’s guilty plea took place this morning before United States Magistrate Judge Ramon E. Reyes, Jr., at the federal courthouse in Brooklyn. Sentencing in this case is scheduled before United States District Judge Raymond J. Dearie on September 27, 2013.
The government’s case is being prosecuted by Assistant United States Attorney Christopher A. Ott.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency task force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
The Defendant:
SAQUIB KHAN
Age: 51
Staten Island, New YorkSpringfield Felon Pleads Guilty to Possessing Child Porn on his Cell PhoneRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Springfield, Mo., man who was recently released after serving a prison term for possessing child pornography pleaded guilty in federal court today to downloading additional child pornography onto his cell phone.
Lattrell Anthony Morris, 29, of Springfield, pleaded guilty before U.S. Magistrate Judge David P. Rush to the charge contained in a Feb. 27, 2011 federal indictment. Morris was sentenced in 2007 to serve 70 months in federal prison for possessing child porn, followed by a lifetime term of supervised release. Morris had been on supervised release for only a few months when he engaged in this criminal conduct.
Morris received a cell phone in September 2012, approximately four months after being released from federal prison. Despite Morris’s supervised release restrictions against Internet services, Morris paid $50 a month for unlimited Internet access through his cell phone.
Morris admitted that he used his cell phone daily to conduct Internet searches for child pornography. Law enforcement officers examined Morris’s cell phone and found more than 15 images of child pornography.
Under the terms of today’s plea agreement, the government and Morris will jointly recommend to the court a sentence of 10 years in federal prison without parole. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Abram McGull II. It was investigated by the FBI, the Springfield, Mo., Police Department and the U.S. Probation and Pretrial Services Office.
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."Smith County Man Sentenced for Attempted Arson of Methadone ClinicRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – A 55-year-old Tyler, Texas, building contractor has been sentenced for federal arson related charges in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Daniel Kubisty pleaded guilty on Jan. 9, 2013, to attempted arson and was sentenced to 16 months in federal prison today by U.S. District Judge Leonard Davis. Kubisty was also ordered to pay restitution in the amount of $8,824.00.
According to information presented in court, on Mar. 19, 2012, Kubisty accepted $3,000 from Edward Jacobs to burn down a building located at 3322 E. Fifth Street in Tyler that was being used by the “Add-Life Recovery Center” methadone clinic. Kubisty and Jacobs conspired to burn down the building in order to gain a competitive advantage for the “Methadone Clinic of East Texas” which was owned by Jacobs and also had an office in Tyler, Texas. On Mar. 19, 2012 Kubisty was arrested in Tyler by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and was found to have a gasoline can, with a wick saturated in gasoline protruding from its neck, in the back of his pickup.
After Kubisty’s arrest, Jacobs feared Kubisty would testify against him and on June 1, 2012, he arranged a meeting with a man he believed he could hire to murder Kubisty in order to prevent Kubisty’s testimony. During the meeting, Jacobs offered to pay the hit-man $12,000.00 for Kubisty’s murder. ATF was monitoring the meeting and arrested Jacobs at the scene. On Dec. 18, 2012 Jacobs pleaded guilty to attempted arson and solicitation of murder for hire. He was sentenced to 188 months in federal prison on Mar. 14, 2013, and ordered to pay over $12,000 in restitution.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and prosecuted by Assistant U.S. Attorney Jim Noble.
Shreveport/Bossier Real Estate Agents Sentenced for Predatory Home Sale PracticesRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that Scott Rister, 43, of Shreveport, and William Clay Goodwin, 43, of Bossier City, were sentenced by U.S. District Judge Elizabeth E. Foote, to serve six months in prison and two years of supervised release for mail fraud. The judge also ordered them to pay $8,150 in restitution to victims of the scheme.
According to evidence presented at the guilty plea, Rister and Goodwin worked together to arrange short sales of residential real estate in the Shreveport/Bossier area. They identified residential property owners whose homes were scheduled for foreclosure or in bankruptcy. Rister offered to arrange short sales for their homes and informed them that Goodwin would attempt to negotiate with the financial institution that held the mortgage to settle the outstanding mortgage. Rister also told the home owners that the home owners would not see a profit from the short sales, and added that Rister and Goodwin’s only compensation was a broker’s commission, which was typically 5 to 6 percent of the sales price. However, Rister and Goodwin included fees and liens on the HUD-1 settlement statements without the home owners’ knowledge, permission or consent. The fees and liens were listed in favor of LLCs created and owned by Rister and Goodwin.
“The defendants took advantage of those who were caught in tough financial situations,” Finley said. “They used their knowledge of the real estate industry to add extra costs without informing the customers involved of the charges. We hope this serves as a reminder to those who would exploit home owners that our office will continue to prosecute cases such as this to the fullest extent of the law.”
Rister pleaded guilty to the mail fraud count Oct. 30, 2012, and Goodwin pleaded guilty Jan. 15, 2013.The FBI investigated the case. Assistant U.S. Attorney Earl M. Campbell prosecuted the case.
Shelby County Man Sentenced for Drug TraffickingRead the Press Release
Department of Justice
Office of Public AffairsTYLER, Texas – A 39-year-old Center, Texas man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Danny Len Lindsey pleaded guilty on Mar. 1, 2013, to possession with intent to manufacture methamphetamine and was sentenced to 48 months in federal prison today by U.S. District Judge Leonard E. Davis.
According to information presented in court, from at least Aug. 14, 2011, Lindsey possessed and distributed methamphetamine in East Texas. A federal grand jury returned an indictment on Nov. 7, 2012, charging Lindsey with drug trafficking violations. Lindsey also admitted to possessing two firearms during his drug trafficking activities and must forfeit both firearms.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Panola County Sheriff’s Office and prosecuted by Assistant U.S. Attorney Bill Baldwin.Savannah Man Pleads Guilty to Two Armed RobberiesRead the Press Release
SAVANNAH, GA: RICO LAVON EDWARDS, 30, of Savannah, Georgia, pled guilty earlier this month before United States District Court Judge B. Avant Edenfield for his role in the armed robberies of the Savannah Postal Credit Union and of Barnett Educational Supplies.
According to evidence presented during his guilty plea hearing, on November 8, 2012, EDWARDS, along with an accomplice, committed an armed bank robbery at the Savannah Postal Credit Union, and took less than $1000 in cash. Less than two weeks later, on November 19, 2012, EDWARDS robbed Barnett Educational Supplies in Savannah, Georgia.
The armed bank robbery count to which EDWARDS pled guilty carries a maximum statutory penalty of up to 25 years in prison; a fine up to $250,000; and 5 years of supervised release. The commercial robbery count to which EDWARDS also pled guilty carries a maximum statutory penalty of up to 20 years in prison; a fine up to $250,000; and 3 years of supervised release. EDWARDS sentencing will be scheduled after the United States Probation Office completes a presentence investigation.
The charges against EDWARDS were the result of a joint investigation conducted by the FBI and the Savannah-Chatham Metropolitan Police Department. Assistant United States Attorneys J. Maria Waters and Brian Rafferty are prosecuting the case on behalf of the United States. For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Ringleader Sentenced to Federal Prison in Connection with Fort Stockton-Based Cocaine Distribution NetworkRead the Press Release
In Pecos yesterday, 34-year-old drug trafficking organization ringleader Noe Torres Ortega was sentenced to 262 months in federal prison followed by five years of supervised release announced United States Attorney Robert Pitman and Drug Enforcement Administration Special Agent in Charge Joseph M. Arabit.
Ortega is the last of 24 indicted defendants who pleaded guilty and was sentenced for his/her role in a Fort
Stockton-based cocaine trafficking conspiracy that was responsible for the distribution of over 50 kilograms of cocaine since 2009. Sentences handed down in this case range from 262 months in federal prison to three years probation.This investigation was conducted by agents with the Drug Enforcement Administration Alpine Resident Office Multi-Agency Task Force (MTF) comprised of agents from DEA, United States Border Patrol, Pecos County Sheriff's Office, Brewster County Sheriff's Office, Alpine Police Department, and the Texas Department of Public Safety - Criminal Investigation Division as well as members of Homeland Security Investigations (HSI) in Presidio and Alpine and the Fort Stockton Police Department. This case was prosecuted by Assistant United States Attorney Monty Kimball.
Providence Man Detained for Allegedly Trafficking Thousands of Ecstasy PillsRead the Press Release
PROVIDENCE, R.I. – Christian M. Araujo, a/k/a Christian Sanchez, 46, of Providence, has been ordered detained in federal custody on a charge of possession with the intent to distribute Ecstasy. Araujo was arrested by DEA agents on May 17, 2013, after he allegedly delivered between 2,400 and 3,000 Ecstasy pills with an estimated street value of approximately $30,000 to a person posing as a drug dealer.
Araujo’s arrest was announced United States Attorney Peter F. Neronha and John J. Arvanitis, Special Agent in Charge of the Drug Enforcement Administration’s New England Field Division.
According to an affidavit in support of a criminal complaint filed with the court, it is alleged that beginning in early April 2013, a person assisting DEA agents assigned to the DEA Worcester Tactical Division began discussions with Araujo for the delivery of significant quantities of Oxycodone and Ecstasy tablets. After at least one meeting and several telephone conversations, it is alleged that Sanchez agreed to sell a significant quantity of the pills.
According to the affidavit, on May 16, 2013, DEA agents watched as Sanchez allegedly delivered between 2,400 and 3,000 Ecstasy pills. The alleged transaction occurred in pharmacy parking lot in Pawtucket. Immediately after the alleged transaction was completed, DEA agents detained Sanchez and seized the pills.
Araujo was ordered detained in federal custody following an initial appearance on Friday before U.S. District Court Magistrate Judge Patricia A. Sullivan.
The case is being prosecuted by Assistant U.S. Attorney Paul F. Daly, Jr.
The DEA Worcester Tactical Division was assisted in the investigation by the R.I. DEA Drug Task Force.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]Prisoner at Fci Danbury Charged with Assaulting Another InmateRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that a federal grand jury sitting in Bridgeport returned an indictment today charging YVONNE DAVIS, 61, a prisoner at the Federal Correctional Institution (FCI) in Danbury, with using a dangerous weapon to assault another inmate at the facility.
The indictment alleges that DAVIS assaulted the inmate on November 25, 2012.
If convicted, DAVIS faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
DAVIS is currently serving a 37-month sentence after having been convicted in the Northern District of Texas of being a felon in possession of a firearm.
Acting U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This case is being investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Neeraj N. Patel.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Pharmacist's Plea: Kidney Dialysis Patients Received Misbranded DrugsRead the Press Release
TOPEKA, KAN. – A pharmacist from Tennessee has pleaded guilty to substituting a cheaper drug imported from China for the iron sucrose that the Federal Drug Administration has approved for kidney dialysis patients, U.S. Attorney Barry Grissom said today. The misbranded drug was administered to kidney dialysis patients in Kansas.
Robert Harshbarger, Jr., 53, Kingsport, Tenn., who was doing business as American Inhalation Medication Specialists, Inc., pleaded guilty to one count of distributing a misbranded drug and one count of health care fraud. In his plea, he admitted that as a result of the fraud kidney dialysis patients treated by Kansas Dialysis Services, L.C., received iron sucrose that had not been certified by the FDA to meet quality and safety standards.
Although there were no reports of harm to patients, the crime put patients at risk because the FDA cannot assure the safety and effectiveness of products that are not FDA approved and come from unknown sources or foreign locations.
Harshbarger admitted that health care benefit programs paid more than $848,000 for the misbranded iron sucrose he distributed from 2004 to 2009. Harshbarger misrepresented the iron sucrose drug as Venofer, which is the only iron sucrose drug approved by the FDA for both pre-dialysis and post-dialysis patients.
Harshbarger purchased iron sucrose from Chinese companies including Qingdao Shenbang Chemical Company in Qingdao, China, and Shanghai Rory Fine Chemicals Co., Ltd., in Shanghai, China. The iron sucrose from China was cheaper than purchasing Venofer.
Sentencing is set for Nov. 4. Both parties have agreed to recommend a sentence of 48 months in federal prison, restitution of approximately $848,504, a criminal fine of $25,000, and a forfeiture judgment of $425,000 to be paid prior to sentencing.
Grissom commended the Food and Drug Administration, the Dept. of Health and Human Services, Office of Inspector General and Assistant U.S. Attorney Tanya Treadway for their work on the case.
Personal Assistant and Beneficiary Sentenced for Fraud on the Medicaid Home Services ProgramRead the Press Release
On May 21, 2013, Daniel Geary, 39, of Caseyville, IL, was sentenced in District Court in East St. Louis, IL, on one count of False Statement related to Health Care Matters, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Having been confined in county jail for four months, Daniel Geary was sentenced to time served, three (3) years of supervised release, a special assessment of $100, and ordered to pay restitution in the amount of $420 to the State of Illinois and the Center for Medicare and Medicaid Services. On the same offense on April 1, 2013, Cynthia Harmon, age 40, of Alton, IL also had been sentenced to time served, two (2) years of supervised release, a special assessment of $100, and ordered to pay restitution in the amount of $420. Daniel Geary and Cynthia Harmon, personal assistant and beneficiary, previously pled guilty to defrauding the Illinois Department of Human Services (DHS) Home Services Program, a Medicaid Waiver Program intended to prevent the unnecessary institutionalization of Medicaid beneficiaries who may be satisfactorily maintained at home. Both admitted to making a materially false statement in connection with the delivery of health care services by reporting on a Home Services Time Sheet sent to the Illinois Department of Human Services, Office of Rehabilitation Services, that Daniel Geary performed 44.5 hours of personal assistant work for Cynthia Harmon from February16 through March 15, 2012, even though each defendant knew that, because Harmon was incarcerated in the St. Louis County jail, the personal assistant services were not performed.
The case was investigated by agents of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) and the Illinois State Police, Medicaid Fraud Control Bureau (MFCB). This case was prosecuted by Assistant U.S. Attorney Michael Jude Quinley.
Penfield Man Pleads Guilty to Drug Trafficking ChargesRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Alfredo Valentin, Jr. a/k/a Alfredo Valentine, a/k/a Fred Valentin, a/k/a Fred Vegas, 42, of Penfield, N.Y., pleaded guilty before U.S. District Judge David G. Larimer to conspiracy to possess with intent to distribute and to distribute one kilogram or more of heroin. The charge carries a mandatory minimum penalty of 20 years in prison, a maximum of life, a fine of $20,000,000 or both. Under the terms of the plea agreement, Valentin will forfeit $74,690 in U.S. currency, a firearm, and rounds of ammunition seized during the investigation.
Assistant U.S. Attorney Robert A. Marangola, who is handling the case, stated that Valentin purchased large quantities of heroin in New York City that he transported back to Rochester. The defendant then processed, packaged, and resold the cocaine in various quantities. Valentin was arrested on January 16, 2013 while driving a rental car. He was found in possession of over 130 grams of heroin and $2,000 in U.S. currency.
During the execution of a search warrant that same day at the defendant’s residence at 491 Plank Road in Penfield, officers recovered a Hi-Point 9mm pistol with a defaced serial number, rounds of 9mm ammunition, and heroin trafficking paraphernalia. On February 13, 2013, agents seized $72,690 in Valentin’s drug proceeds during the execution of a federal search warrant at 140 Central Park in Rochester.
The plea is the culmination of an investigation on the part of Special Agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Brian R. Crowell, New York Field Division, with assistance provided by the Greater Rochester Area Narcotics Enforcement Team (GRANET), and the Rochester Police Department under the direction of Chief James M. Sheppard, the Monroe County District Attorney’s Office, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives under the direction of Resident Agent in Charge, Scott Heagney.
Sentencing is scheduled for September 5 at 10:30 a.m. before Judge Larimer.
Owner and COO of Defunct Eastern Livestock Company Sentenced in Federal Court for Committing Mail FraudRead the Press Release
– Founder Thomas Gibson sentenced to 70 months in federal prison;
– COO Michael McDonald sentenced to 57 months in federal prisonLOUISVILLE, KY – The former owner and former chief operating officer of now-bankrupt Eastern Livestock Company, LLC, were sentenced in U. S. District Court today, by Senior Judge Thomas B. Russell, for mail fraud arising from their part in a check-kiting scheme that caused the loss of millions of dollars to hundreds of businesses and individuals, including approximately 200 sellers of cattle located in Kentucky, who did business with Eastern Livestock in 2010, announced David J. Hale, United States Attorney for the Western District of Kentucky.
Founder and former owner, Thomas P. Gibson, age 73, of Lanesville, Indiana, was sentenced to 70 months in federal prison, followed by two years of supervised release, and former Chief Operating Officer Michael Steven McDonald, age 61, of Lanesville, Indiana, was sentenced to 57 months in federal prison, followed by two years of supervised release, for their parts in a multi-million dollar check kiting scheme. There is no parole in the federal system.
“Gibson and McDonald caused widespread damage to the livestock industry and devastating harm to numerous individual cattle farmers in Kentucky and elsewhere. Many other businesses associated with the livestock industry were also damaged by the Eastern Livestock fraud. These lengthy prison sentences hold Gibson and McDonald accountable for their federal crimes,” commented U.S. Attorney Hale. “Additionally, our seizure of $4.7 million from the defendants has preserved a significant portion of the crime proceeds, which will ultimately be distributed to victims of the fraud. Equitable disbursement of these funds to victims will be accomplished through a coordinated process involving two Eastern Livestock bankruptcy cases pending in the Southern District of Indiana, and the forfeiture action brought by my office in federal court in the Western District of Kentucky.”
Eastern Livestock was one of the largest cattle brokerage businesses in the United States, processing cattle sales and operating branch facilities in eleven states, including Kentucky, until its closure on November 2, 2010. According to the plea agreement, between August 9, 2004 and November 2, 2010, in Nelson County, Kentucky, and elsewhere, the defendants Gibson and McDonald, engaged in an extensive check-kiting fraud in order to induce Fifth Third Bank to release funds from a $32 million line of credit issued by the bank in favor of Eastern Livestock Company. The check-kiting scheme caused grossly inflated balances in accounts maintained by Eastern Livestock with the bank. To further support the fraudulent scheme, the defendants caused false and fraudulent documents to be submitted on a daily basis to Fifth Third, which contained grossly inflated accounts receivable figures. The U.S. mail and/or commercial interstate carrier service was used in the execution of the scheme in that the defendants caused checks to be issued from Eastern Livestock accounts, which were mailed to business associates who agreed that checks from their business accounts could be deposited into the Eastern Livestock account at Fifth Third, thereby temporarily inflating the account balance. Two such Eastern Livestock checks in the amounts of $94,374.48 and $98,101.93, were delivered via U. S. Postal Service to a designated address in Nelson County, Kentucky, on or about September 5, 2008. When Fifth Third closed Eastern Livestock's accounts in November 2010 because of the check-kite, Fifth Third, Wells Fargo, and hundreds of cattle sellers, auction houses, and other people who had done business with Eastern Livestock sustained losses. The cattle sellers had received Eastern Livestock checks in payment for cattle, and these checks were dishonored by Fifth Third Bank and returned when Eastern Livestock's accounts were closed. At the time, there were insufficient funds to cover the millions of dollars in outstanding Eastern Livestock checks issued by the defendants.
U.S. Attorney Hale commended the collaborative investigation involving the U.S. Department of Agriculture’s Office of Inspector General, the U.S. Postal Inspection Service, and the Federal Bureau of Investigation.
This case was prosecuted by Assistant U.S. Attorney Marisa Ford, and Special Assistant U.S. Attorney James R. Lesousky, Jr. Assistant U.S. Attorney Amy Sullivan is prosecuting the civil forfeiture claim.
Oakland Man Sentenced to 121 Months and Ordered to Pay $3.37 Million for Charity Fraud SchemeRead the Press Release
OAKLAND – Keith Aaron Vann was sentenced yesterday to 121 months in prison and ordered to pay $3,377,089.64 in restitution for his role in a conspiracy to defraud three Arizona residents into donating millions of dollars to a phony charitable organization, United States Attorney Melinda Haag announced.
After a four-day trial, a jury convicted Vann on December 17, 2012, of conspiracy to commit wire fraud and mail fraud, a separate count of wire fraud, and three counts of money laundering. During the trial, evidence showed that Vann participated in a scheme to defraud the victims, two of whom were Arizona elementary school teachers, of over $3.3 million from their father’s estate by making false representations including, among other things, that an entity known as Global Missions was a non-profit organization recognized by the Internal Revenue Service (IRS); that it provided humanitarian aid worldwide, including in Africa; and that donations to Global Missions would be tax deductible. Evidence presented at trial showed that, contrary to these representations, Vann and others used donations to Global Missions to pay for personal trips, jewelry, a down payment on a luxury car, and a $1.25 million home. In furtherance of the conspiracy, Vann posed as Global Missions’ attorney, “James Preston, Esq.” Acting as Preston, Vann told the victims that he had expertise in facilitating tax deductible charitable donations with the IRS.
Vann, 42, of Oakland, California, was charged by indictment on April 16, 2008. The sentence was handed down by U.S. District Court Judge Saundra Brown Armstrong . Judge Armstrong also sentenced Mr. Vann to a three-year period of supervised release. Vann was immediately remanded into custody following the sentencing hearing.
Wade M. Rhyne is the Assistant U.S. Attorney prosecuting the case, with the assistance of Legal Assistants Kathleen Turner and Janice Pagsangan, and Paralegal Noble Hughes. The prosecution is the result of a three-year investigation by the IRS, Criminal Investigation Division, and the Federal Bureau of Investigation.
Nine Indicted for Federal Firearm and Drug ViolationsRead the Press Release
Jacksonville, Florida- United States Attorney Robert E. O'Neill announces the return of indictments charging nine individuals involved in the illegal sale of firearms and narcotics in Jacksonville. Today, special agents from the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), and the Florida Department of Law Enforcement (FDLE), along with detectives from the Jacksonville Sheriff's Office (JSO) arrested four individuals as part of an undercover law enforcement operation. The effort, dubbed "Delta Deuce," involved coordinated efforts among local, state, and federal law enforcement agencies and state and federal prosecutors. Three individuals were previously taken into custody and two are still being sought by law enforcement.
Nicklas McLain (23, Calahan) was indicted on eleven felony charges involving the sale of marijuana, cocaine, and firearms from December 2012 through March 2013. McLain sold three firearms to undercover agents. McLain also has prior felony convictions for sale of cannabis and possession of cocaine. He faces a minimum sentence of five years, up to a maximum of life imprisonment. McLain was arrested on April 3, 2013, and is being detained without bond pending trial.
Edward Dooley (20, Jacksonville) was indicted on ten felony charges involving the sale of marijuana and firearms from December 2012 through February 2013. Dooley sold eight firearms to undercover agents. He also has a prior felony conviction for burglary. Dooley faces a minimum sentence of five years, up to a maximum sentence of life imprisonment. He was also arrested on April 3, 2013. Dooley is serving a state sentence for violation of probation.
Jamar Powell (27, Jacksonville) was indicted on four felony charges involving the sale of crack cocaine and firearms during January 2013. Powell sold four firearms to undercover agents. Powell also has a prior felony conviction for sale of cocaine. He faces a minimum sentence of five years up to a maximum of life imprisonment. Powell was arrested on May 13, 2013, and is being detained without bond pending trial.
Omar Stovall (22, Jacksonville) was indicted on four felony charges involving the sale of marijuana and a firearm during December 2012. Stovall faces a minimum sentence of five years, up to a maximum of life imprisonment.
Leggetts Jenkins (28, Jacksonville) was indicted on three felony charges involving the sale of cocaine and a stolen firearm during February 2013. Jenkins faces a sentence of up to 50 years in federal prison.
Yessenia Terrell (20, Jacksonville) was indicted for selling crack cocaine to ATF agents during January and April 2013. He faces up to 40 years in federal prison.David Gonzalez (32, Middleburg) was indicted for being a felon in possession of a firearm. Gonzalez sold a 9mm pistol to ATF agents during January 2013. Gonzalez faces up to 10 years in federal prison.
Four others are being prosecuted by the State Attorney's Office for selling narcotics.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
These cases were investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Jacksonville Sheriff's Office and the Florida Department of Law Enforcement. The cases will be prosecuted by Assistant United States Attorney Frank Talbot.
This is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” program - a nationwide, gun-violence reduction strategy. United States Attorney Robert E. O’Neill, along with Julie Torres, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials.
The successes of today’s activities are directly related to ATF’s “Frontline” strategy; an intelligence-driven approach to investigating federal firearms crimes. It focuses on the continuous communication, assessment, measurement, and collaboration of resources among federal, state, and local law enforcement partners.
Nigerian National Convicted for Resisting Deportation OrdersRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced today that Emmanuel Nwankwo, 54, of Nigeria, was found guilty by a federal jury for impeding or hampering his deportation. U.S. District Judge Dee D. Drell presided over the trial.
Nwankwo’s trial started Monday and ended this morning with the jury returning the guilty verdict after deliberating for 14 minutes. Witness testimony and documents admitted at trial revealed that U.S. Immigration Enforcement Agents (IEA) brought the defendant to the Alexandria International Airport on Dec. 11, 2012 and attempted to put him on a commercial flight. The defendant began yelling and physically resisting officers, which prevented him from boarding the flight because of airline and Transportation Security Administration policies.
Nwankwo faces four years in prison, a $250,000 fine, and one year of supervised release for each count. Sentencing has been set for Aug. 13, 2013.
The Immigration and Customs Enforcement - Enforcement and Removal Operations conducted the investigation. Assistant U.S. Attorneys Seth D. Reeg and Cytheria D. Jernigan are prosecuting the case.Nashville Resident Sentenced for Filingfalse Tax ReturnsRead the Press Release
James Robert Sanford, 53, of Nashville, formerly of Clarksville, Tenn., was sentenced yesterday by Chief U.S. District Judge William J. Haynes, Jr. to serve 13 months in prison followed by a three year term of supervised release, for filing false tax returns, announced David Rivera, Acting U.S. Attorney for the Middle District of Tennessee.
Sanford was also ordered to pay $78,822.00 in restitution to the United States.
Sanford pleaded guilty to filing false tax returns on January 14, 2013, and admitted that for tax years 2006 and 2007 he had prepared and filed false income tax returns on behalf of himself and his spouse and had assisted 18 other individuals in preparing and filing 26 income tax returns, which fraudulently claimed tax refunds.This case was investigated by the IRS-Criminal Investigation. Assistant U.S. Attorney Darryl A. Stewart represented the government.
Mt. Morris Man Charged in Child Pornography CaseRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Patrick Welch, 57, of Mt. Morris, N.Y., was arrested and charged by criminal complaint with possession, receipt and distribution of child pornography. In this case, possession of child pornography carries a mandatory minimum penalty of 10 years in prison, a maximum of 20 years, and a fine of $250,000. Receipt and/or distribution of child pornography carries a mandatory minimum penalty of 15 years in prison, a maximum of 40 years, and a fine of $250,000.
Assistant U.S. Attorney Tiffany H. Lee, who is handling the case, stated that according to the complaint, on May 13, 2013, the Livingston County Sheriff's Office received a lead from the Los Angeles County Sheriff's Office concerning a potential child exploitation case. A Los Angeles County Sheriff's investigator received a cyber tip from the National Center for Missing and Exploited Children that two individuals appeared to be chatting about and trading child pornography on the internet site tagged.com. Both individuals purported to be teenaged boys. One of the individuals chatting used the screen name "David D" who provided an email address.
A search warrant was executed on the provided email account and several images of child pornography were found. The internet protocol address for "David D" was registered to Welch's address on Scipio Road in Mt. Morris. After a search warrant was executed at Welch's residence this morning, a forensic preview of one of Welch's computers was conducted and several images of child pornography were found.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The criminal complaint is the culmination of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero, the Livingston County Sheriff's Office under the direction of Undersheriff Jim Szczesniak and the Los Angeles County Sheriff's Department, under the direction of Sheriff Leroy D. Baca.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.Most Wanted “Deadbeat Parent” Sentenced to 31 Months’ Imprisonment for Fleeing to Evade over $1 Million in Child Support ObligationsRead the Press Release
Earlier today, at the federal courthouse in Central Islip, New York, Robert D. Sand, the nation’s “Most Wanted Deadbeat Parent” according to law enforcement, was sentenced to 31 months in prison followed by one year of supervised release by United States District Judge Joseph F. Bianco. Sand previously pleaded guilty to two counts of traveling in interstate and foreign commerce with the intent to evade court ordered child support obligations totaling over $1 million including interest and penalties. Sand was also sentenced to restitution in the amount of his unpaid support obligations – $903,789.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, Thomas O’Donnell, Special Agent in Charge of the New York Regional Office, Office of the Inspector General, United States Department of Health and Human Services (OIG-DHHS), and Charles Dunne, United States Marshal for the Eastern District of New York.
At the time of his plea, Sand admitted that he initially relocated from New York to Florida and then fled the United States in order to evade his support obligations following the issuance of arrest warrants in both state and federal court in 2000 and 2002. Sand further admitted that he had spent much of the past decade in the Kingdom of Thailand where he operated a business. Sand was arrested in late November 2012, upon entering the Republic of the Philippines from Thailand without proper identification documents, and on December 17, 2012, he was deported to Los Angeles, where he was taken into custody by deputies of the United States Marshals Service. During the time Sand was a fugitive, his support obligations continued to grow. At the time of his arrest, Sand owed more than $1 million in back child support including interest and penalties.
According to a complaint filed in federal court on April 8, 2002, the New York State Family Court in Nassau County issued an arrest warrant for Sand on November 22, 2000, following multiple contempt findings against him in child support proceedings. A federal arrest warrant was issued for Sand on April 8, 2002. On September 17, 2009, an indictment was filed in federal court in the Eastern District of New York charging Sand with two counts of failure to pay child support, and on February 17, 2010, a second federal warrant was issued for Sand’s arrest.
“Robert Sand literally fled the country to avoid his obligation to the children he brought into this world. But law enforcement did not turn their back on those children and what they were due. This Father’s Day will find Sand behind bars, finally being held to account for his abandonment. The sentence imposed today sends a message to those who would flee their lawful child support obligations that we will prosecute them to the fullest extent of the law,” stated United States Attorney Lynch. “As this investigation and prosecution demonstrate, flight from prosecution may delay, but will not deny justice.” Ms. Lynch expressed her grateful appreciation to the Office of the Inspector General, United States Department of Health and Human Services and the United States Marshals Service for their assistance in this case.
In January 2012, OIG-DHHS launched a child support enforcement web page (http://oig.hhs.gov/fraud/child-support-enforcement/) to seek the public’s help in ongoing federal efforts to bring fugitive “deadbeat parents” to justice. Sand was listed on the site as the number one “Most Wanted Deadbeat Parent” based upon his child support obligations totaling more than $1 million.
The government’s case was prosecuted by Assistant United States Attorney Allen Bode.
The Defendant:
Name: ROBERT D. SAND
Age: 51Members of International Sex Trafficking Ring IndictedRead the Press Release
Arturo Rojas-Coyotl, Odilon Martinez-Rojas, and Severiano Martinez-Rojas, all of Tenancingo in the state of Tlaxcala, Mexico have been indicted on charges of sex trafficking and alien harboring, announced the Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Northern District of Georgia. A fourth man, Daniel Garcia-Tepal, also of Tlaxcala, Mexico, is charged with encouraging and inducing aliens to enter and reside in the United States unlawfully.
According to U.S. Attorney Yates, the charges and other information presented in court: Rojas-Coyotl and his uncles Odilon Martinez-Rojas and Severiano Martinez-Rojas used force, fraud and coercion to compel three women to engage in prostitution in Atlanta and Norcross, Ga. at various times between 2006 and 2008. Daniel Garcia-Tepal and Arturo Rojas-Coyotl are also charged with encouraging and inducing a fourth woman to unlawfully enter and remain in the United States between 2010 and 2013.
Special Agents of the FBI and ICE Homeland Security Investigations arrested Arturuo Rojas-Coyotl, Odilon Martinez-Rojas, and Daniel Garcia-Tepal in a highly coordinated law enforcement sweep today. Severiano Martinez-Rojas remains a fugitive and is believed to be in Mexico. The FBI will coordinate with its legal attaché in Mexico City to affect his arrest and subsequent extradition back to the U.S. Four search warrants were also executed today in Atlanta and Norcross, Ga. in conjunction with the arrests.
Rojas-Coyotl, 26, Martinez-Rojas, 41, Martinez-Rojas, 48, and Garcia-Tepal, 28, are scheduled for arraignment today. Each sex trafficking charge carries a maximum sentence of life in prison while each alien harboring charge has a maximum sentence of 10 years in prison, with all counts carrying a fine of up to $250,000 each. In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
This case is being investigated by Special Agents of the FBI and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Interagency cooperation in international sex trafficking operations is imperative and vital to the success of the prosecution.
Assistant U.S. Attorney Susan Coppedge and Trial Attorney Benjamin Hawk of the Civil Rights Division’s Human Trafficking Prosecution Unit are prosecuting the case.
Anyone with information related to sex trafficking should call the Atlanta FBI hotline at 404-679-9000 or the National Human Trafficking Resource Center at 1-888-3737-888.
Members of the public are reminded that the indictment contains only allegations. A defendant is presumed innocent of the charges and it will be the government's burden to prove a defendant's guilt beyond a reasonable doubt at trial.
Members of International Sex Trafficking Ring IndictedRead the Press Release
Victims Brought to Atlanta and Southeast from Mexico and Guatemala
ATLANTA - Arturo Rojas-Coyotl, Odilon Martinez-Rojas, and Severiano Martinez-Rojas, all of Tenancingo in the state of Tlaxcala, Mexico have been indicted on charges of sex trafficking and alien harboring. A fourth man, Daniel Garcia-Tepal, also of Tlaxcala, Mexico, is charged with encouraging and inducing aliens to enter and reside in the United States unlawfully.
“Sex trafficking is a malicious crime whether the victims are American citizens or foreign nationals,” said United States Attorney Sally Quillian Yates. “The defendants are charged with preying on young women from Mexico and Guatemala, smuggling them into the United States under false pretenses, and forcing them into prostitution. U.S. laws protect all trafficking victims, and we will prosecute those who engage in this practice.”
“The enslavement of women forced into prostitution is a heinous crime that occurs all too frequently in our communities,” said Brock D. Nicholson, Special Agent in Charge of ICE Homeland Security Investigations in Atlanta. “Across the country, law enforcement agencies from the federal to the local level are teaming up to identify, arrest and prosecute those who seek to profit at the expense of the suffering of others. This case could not have happened without the excellent relationships we have with the FBI and the U.S. Attorney for the Northern District of Georgia.”
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated: “Today’s indictments and subsequent arrests are a continuation of the federal law enforcement effort to stem the international trafficking of individuals to fuel the commercial sex industry here in the U.S. and in particular in Atlanta. The FBI asks that anyone with information regarding this type of activity to contact their nearest FBI field office immediately.”
According to United States Attorney Yates, the charges and other information presented in court: Rojas-Coyotl and his uncles Odilon Martinez-Rojas and Severiano Martinez-Rojas used force, fraud and coercion to compel three women to engage in prostitution in Atlanta and Norcross, Ga. at various times between 2006 and 2008. Daniel Garcia-Tepal and Arturo Rojas-Coyotl are also charged with encouraging and inducing a fourth woman to unlawfully enter and remain in the United States between 2010 and 2013.
Special Agents of the FBI and ICE Homeland Security Investigations arrested Arturuo Rojas-Coyotl, Odilon Martinez-Rojas, and Daniel Garcia-Tepal in a highly coordinated law enforcement sweep today. Severiano Martinez-Rojas remains a fugitive and is believed to be in Mexico. The FBI will coordinate with its legal attaché in Mexico City to affect his arrest and subsequent extradition back to the United States. Four search warrants were also executed today in Atlanta and Norcross, Ga. in conjunction with the arrests.
Rojas-Coyotl, 26, Martinez-Rojas, 41, Martinez-Rojas, 48, and Garcia-Tepal, 28, are scheduled for arraignment today. Each sex trafficking charge carries a maximum sentence of life in prison while each alien harboring charge has a maximum sentence of 10 years in prison, with all counts carrying a fine of up to $250,000 each. In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
This case is being investigated by Special Agents of the Federal Bureau of Investigation and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. Interagency cooperation in international sex trafficking operations is imperative and vital to the success of the prosecution.
Assistant United States Attorney Susan Coppedge and Trial Attorney Benjamin Hawk of the Civil Rights Division’s Human Trafficking Prosecution Unit are prosecuting the case.
Anyone with information related to sex trafficking should call the Atlanta FBI hotline at 404-679-9000 or the National Human Trafficking Resource Center at 1-888-3737-888.
Members of the public are reminded that the indictment contains only allegations. A defendant is presumed innocent of the charges and it will be the government's burden to prove a defendant's guilt beyond a reasonable doubt at trial.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney’s Office for the Northern District of Georgia is www.justice.gov/usao/gan.
Melvin Jeovany Vasquez Pleads Guilty to Illegal ReentryRead the Press Release
MELVIN JEOVANY VASQUEZ, age 30, a citizen of Honduras pled guilty in federal court today before U. S. District Judge Jay C. Zainey to a one-count indictment charging him with illegal re-entry of a removed alien, announced U.S. Attorney Dana J. Boente.
According to court documents, VASQUEZ admitted to being an alien who had previously been removed from the United States, was found in the United States, on April 7, 2013, without having obtained consent from the Secretary of the Department of Homeland Security to reapply for admission to the United States.
The indictment charging VASQUEZ with illegal reentry also included a notice of sentencing enhancement based on his prior felony conviction. With the enhancement, the charge carries a maximum statutory penalty of ten (10) years imprisonment, a fine of $250,000, and three (3) years of supervised release following any term of imprisonment. Sentencing for the defendant is scheduled for August 20, 2013 at 10:00 A.M.
This case was investigated by United States Immigration and Customs Enforcement, Enforcement and Removal Operations (ICE) as part of Operation Safe Neighborhood. The prosecution is being handled by Special Assistant United States Attorney Robert Weir.
(Download Factual Basis )
Media AdvisoryRead the Press Release
FOR PLANNING PURPOSES ONLY
TUESDAY, MAY 21, 2012
*******MEDIA ADVISORY*******The U.S. Attorney for the Northern District of Alabama, along with the FBI, IRS Criminal Investigation Division, the Jefferson County Sheriff’s Office and other law enforcement agencies will hold a press conference today to announce arrests in a large-scale narcotics trafficking investigation in western Birmingham and Jefferson County.
WHAT: Press conference
WHEN: Today
2:30 P.M.
WHERE: U.S. Attorney’s Office
1801 Fourth Ave. North
Birmingham, AL 35203
2nd Floor Conference RoomMedia should arrive about 30 minutes before the press conference to set up.
NOTE: All media must have photo identification and valid media credentials. For additional information, contact Peggy Sanford at 205-244-2020, or [email protected].
Martin Lloyd Old Horn Arraigned and Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on May 21, 2013, before U.S. District Judge Sam E. Haddon, MARTIN LLOYD OLD HORN, a 22-year-old resident of Hardin, was arraigned and pled guilty to mail fraud - scheme to defraud or to obtain money or property by false promises. Sentencing has been set for September 10, 2013. He is currently released on special conditions.
In an Offer of Proof filed by Assistant U.S. Attorney Carl E. Rostad, the government stated it would have proved at trial the following:
The Crow Tribal Historic Preservation Office (CTHPO) Is a designated office of the Crow Indian Tribe that provides for direct Tribal involvement and leadership in the protection and enhancement of Crow lands and cultural resources. It serves to identify, inventory, and protect culturally, archeologically, and historically important resources both on and off the reservation.
Each year, the CTHPO receives grant funds from the National Park Service, U.S. Department of the Interior. A requirement for any enterprise seeking to do work on the reservation that may disturb tribal lands - utilities, construction, energy exploration, development - is that the business employ the services of a CTHPO employee (archeological technician) to monitor the project to insure that lands of cultural or historic importance are not destroyed. The company is then charged for this monitoring service and payments are made to the Crow Tribe.
During the summers of 2010 and 2011, either before leaving for or while home from school at the University of Montana (UM), OLD HORN, at the urging and instigation of his mother and other family members, represented himself to be a monitor for the Crow Tribe Historical Preservation Office. He had no training for the position, had not been hired by the Crow Tribe to be a tribal monitor, and had no authority other than the direction of his family to engage in the business of being a tribal monitor.
During 2010, the evidence would have reflected that the invoices to companies for direct payment to OLD HORN, for his purported services, were submitted by his mother. During 2011, the time period alleged in the indictment, the evidence indicates that OLD HORN submitted invoices for his purported services directly. OLD HORN billed on an hourly basis and always billed for an entire day. The evidence would show that OLD HORN was usually in the company of his mother or cousin when on-site, that he made no logs or reports documenting his work or observations as required by legitimate monitoring standards, and that on numerous occasions he was not on site for the hours billed to the company. During the time period of the indictment - the two month period in the summer of 2011 - OLD HORN received $19,184.15 in compensation from companies doing business on the Crow Indian Reservation.
In addition, OLD HORN received an additional $24,477 when his mother submitted invoices on his behalf, for a total of $43,661 received on the basis of his billing for services as if a legitimate tribal monitor. The United States maintains that the fraudulent nature of the invoices remains the same whether submitted by OLD HORN or his mother. The United States and OLD HORN have stipulated to one-half of the total amount - $21,830 - as restitution and use in the fraud loss calculation based on the time and service that may have been legitimately rendered.
The companies made their payments to Martin OLD HORN through the U.S. Mail.
OLD HORN faces possible penalties of 20 years in prison, a $250,000 fine and 3 years supervised release.
The investigation was conducted by the U.S. Department of Interior - Office of Inspector General. # # # #
Manhattan U.S. Attorney Charges Art Dealer with Hiding Millions of Dollars in Income from Fraudulent Sales of ArtworkRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Toni Weirauch, the Special Agent-in-Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), and George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the arrest of GLAFIRA ROSALES, an art dealer, for filing false tax returns and for failing to disclose a foreign bank account to the IRS. ROSALES allegedly failed to report the receipt of at least $12.5 million in income from the sale of works purported to be by celebrated abstract expressionist artists. Most of the income was received in a bank account in Spain that ROSALES hid from, and failed to disclose to, the IRS. She was arrested in Sands Point, New York this morning and will be presented in Manhattan federal court this afternoon before U.S. Magistrate Judge Sarah Netburn.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Glafira Rosales gave new meaning to the phrase ‘artful dodger’ by avoiding taxes on millions of dollars in income from dealing in fake artworks for fake clients. Her arrest shows that no matter how clever the scheme, attempts to hide income from the government to avoid paying taxes on that income will be discovered and prosecuted.”
IRS Special Agent-in-Charge Toni Weirauch said: “The sale of a piece of art for profit is a taxable event and the seller is responsible for paying his or her fair share of tax, even if the art is counterfeit. The allegations in this investigation illustrate a ‘double-barreled’ tax evasion scheme: disguising who was actually selling the art and profiting from the sales, through the creation of a fictitious seller and the use of the name of a collector not associated with the transactions, and further concealing the proceeds by depositing them in an unreported foreign bank account.”
FBI Assistant Director-in-Charge George Venizelos said: “As alleged, Glafira Rosales committed tax fraud in falsely reporting that she was selling art on behalf of clients. In truth, those clients were just part of the picture she painted to perpetrate her multi-million dollar scheme. There is consistency in the scheme, however: The artwork Rosales sold appears to be as fake as her story about the clients she claimed to represent.”
According to the allegations in the Complaint unsealed today in Manhattan federal court:
In the 1990’s, ROSALES, an art dealer, began selling previously unknown paintings that had never been exhibited before, and that she claimed were painted by some of the most famous artists of the 20th century, including Jackson Pollock, Mark Rothko, and Willem de Kooning. From 2006 through 2008, ROSALES sold approximately one dozen of these paintings to two prominent Manhattan galleries for over $14 million. In selling most of the paintings to the two galleries, she purported to represent a client with ties to Switzerland who had inherited the paintings and wanted to sell them, but who also wished to remain anonymous (the “Purported Swiss Client”). For the remainder of the paintings, she purported to represent a Spanish collector (the “Purported Spanish Collector”). ROSALES also claimed that a portion of the price paid by the Manhattan galleries would be her commission for selling the paintings, and that the remainder would be passed along to her clients.
In contrast to the claims made by ROSALES, the investigation has revealed that:
- experts in the fields of art, art history, and materials science have concluded that at least several of the paintings sold by her are counterfeit;
- the Purported Swiss Client on whose behalf she claimed to sell most of the paintings to the Manhattan galleries never existed;
- the Purported Spanish collector on whose behalf she claimed to sell the remainder of the paintings to the Manhattan galleries never owned the paintings; and
- instead of passing along a substantial portion of the proceeds of the sale of the various paintings, she kept all or almost all of the proceeds, and transferred substantial portions to an account maintained by her then-boyfriend.
ROSALES filed tax returns that falsely claimed she had not kept all, or almost all of the proceeds from the sale of the purported clients’ paintings, when, in fact, she had. Further, there was no Swiss client and no Spanish collector. In total, she failed to report the receipt of at least $12.5 million of income for the years 2006 through 2008.
In addition, ROSALES received most of the proceeds from the sale of the paintings in a foreign bank account that she hid from, and failed to report to, the IRS. U.S. taxpayers are required to report the existence of any foreign bank account that holds more than $10,000 at any time during a given year by the filing of a Report of Foreign Bank and Financial Accounts, Form TD F 90-22.1 (“FBAR”). ROSALES failed to file FBARs for the years 2007 through 2011.
ROSALES, 56, of Sands Point, New York, is charged with filing false tax returns for the years 2006 through 2008, and with willful failure to disclose an offshore bank account for the years 2007 through 2011. On each of the three false tax return charges, she faces a maximum sentence of three years in prison, a maximum term of three years of supervised release, and a maximum fine of $100,000. On each of the five willful failure to file FBAR charges, she faces a maximum sentence of five years in prison, a maximum term of five years of supervised release, and a maximum fine of $250,000.
Mr. Bharara praised the outstanding efforts of IRS-CI and FBI in the investigation, which he noted is ongoing. He also thanked the Department of Justice’s Tax Division for their significant assistance in the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Jason P. Hernandez and Daniel W. Levy are in charge of the prosecution.
The charge and allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Glafira Rosales Complaint
Manhattan U.S. Attorney and FBI Assistant Director-In-Charge Announce Arrest of NYPD Detective for Computer HackingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the arrest of EDWIN VARGAS, a detective with the New York City Police Department (“NYPD”), for computer hacking crimes. VARGAS was arrested this morning outside his residence in Bronxville, New York, and will be presented in Manhattan federal court later today before U.S. Magistrate Judge Sarah Netburn.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Detective Edwin Vargas paid thousands of dollars for the ability to illegally invade the privacy of his fellow officers and others. He is also alleged to have illegally obtained information about two officers from a federal database to which he had access based on his status as an NYPD detective. When law enforcement officers break the laws they are sworn to uphold, they do a disservice to their fellow officers, to the Department, and to the public they serve, and it will not be tolerated.”
FBI Assistant Director-in-Charge George Venizelos said: “As alleged, the defendant illegally acquired log-in information for the e-mail accounts of dozens of people, including police department co-workers. Of all places, the police department is not a workplace where one should have to be concerned about an unscrupulous fellow employee. Unlike the e-mail accounts, the defendant didn’t need to pay anyone to gain access to the NCIC database. But access is not authorization, and he had no authorization.”
According to the Complaint unsealed today in Manhattan federal court:
E-mail hacking services have the ability to gain unauthorized access to any e-mail account in exchange for a fee. Between March 2011 and October 2012, VARGAS, an NYPD detective assigned to a precinct in the Bronx, hired an e-mail hacking service to obtain log-in credentials, such as the password and username, for certain e-mail accounts. In total, VARGAS purchased at least 43 personal e-mail accounts and one cellular phone belonging to at least 30 different individuals, including 21 who are affiliated with the NYPD; of those 21, 19 are current NYPD officers, one is a retired NYPD officer, and one is on the NYPD’s administrative staff. After receiving the log-in credentials he had purchased from the e-mail hacking services, VARGAS accessed at least one personal e-mail account belonging to a current NYPD officer. He also accessed an on-line cellular telephone account belonging to another victim. VARGAS paid a total of more than $4,000 to entities associated with the e-mail hacking services.
An examination of the contents of the hard drive from VARGAS’s NYPD computer revealed, among other things, that the Contacts section of his g-mail account included a list of at least 20 e-mail addresses, along with what appear to be telephone numbers, home addresses, and vehicle information corresponding to those e-mail addresses, as well as what appear to be the passwords for those e-mail addresses.
VARGAS also accessed the National Crime Information Center (NCIC) database, a federal database, to obtain information about at least two NYPD officers without authorization. The e-mail accounts of those two officers were among the e-mail accounts VARGAS paid the e-mail hacking services to hack into so he could obtain log-in credentials.
VARGAS, 42, of Bronxville, New York, is charged with one count of conspiracy to commit computer hacking and one count of computer hacking. Each count carries a maximum sentence of 1 year in prison.
Mr. Bharara praised the investigative work of the FBI. He also thanked the NYPD and its Internal Affairs Bureau for their cooperation and assistance in the investigation.
The prosecution of this case is being handled by the Office’s Complex Frauds Unit. Assistant United States Attorney Rosemary Nidiry is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. v. Edwin Vargas Complaint
Man Pleads Guilty to Conspiracy Involving Embezzlement from Turnberry AssociatesRead the Press Release
LAS VEGAS, Nev. – A man has pleaded guilty to conspiracy to commit fraud for his role in the embezzlement of nearly $5.6 million from Turnberry Associates, the parent company which owned or developed the Residences at MGM, Town Square shopping center, Turnberry Place, Turnberry Towers, and the Stirling Club in Las Vegas, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Rocco Lazazzaro, 55, of Las Vegas, pleaded guilty to conspiracy to commit wire fraud and is scheduled to be sentenced on Aug. 22, 2013, by U.S. District Judge Gloria M. Navarro.
According to Lazazzaro’s written guilty plea agreement, from about May 17, 2007, to about Jan. 12, 2012, he and Hope Ippoliti, 51, the former controller for Turnberry Associates, conspired to steal approximately $3.7 million dollars from Turnberry and its affiliates. Ippoliti created fund transfer requests containing false information that the funds were intended for business-related purposes when she and Lazazzaro actually intended to withdraw the funds for personal use. Ippoliti faxed or emailed the fund transfer requests from Nevada to Turnberry Associates in Florida to cause the transfer of funds into Bank of America accounts over which she had signatory authority. Ippoliti and Lazazzaro deposited and cashed checks and cashier’s checks drawn on Bank of America bank accounts belonging to Turnberry Associates and its affiliates. The total losses to Turnberry Associates and its affiliates are approximately $5.6 million. According to Lazazzaro’s guilty plea agreement, he was directly involved in causing approximately $3.7 million of those losses.
In March, Ippoliti pleaded guilty to conspiracy to commit wire fraud resulting in total losses of $5.6 million dollars, and is scheduled to be sentenced on July 11, 2013 before U.S. District Judge Gloria M. Navarro.
Both Lazazzaro and Ippoliti face a maximum of 20 years in prison, a $250,000 fine, criminal forfeiture, five years of supervised release, and are required to make full restitution to Turnberry Associates.
The case was jointly investigated by the FBI and United States Secret Service and is being prosecuted by Assistant U.S. Attorney Christina M. Brown.
Today's announcement is part of efforts underway by President Obama's Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys' offices and state and local partners, it's the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.Leader of Crack Distribution Ring Sentenced to 14 Years in Federal PrisonRead the Press Release
McALLEN, Texas – Mexican Nationals Emmanuel Barrientos, 33, and Juan Trevino, 38, have been ordered to prison following their convictions in relation to a crack cocaine trafficking conspiracy, United States Attorney Kenneth Magidson announced today. The two men pleaded guilty on March 4, 2013.
Today, U.S. District Judge Micaela Alvarez handed Barrientos a sentence of 168 months for conspiring to possess with the intent to distribute crack cocaine. Convicted of possessing with the intent to distribute crack cocaine, Trevino was sentenced to 82 months of federal imprisonment. Barrientos also received a five-year-term of supervised release.
In August 2011, agents of the Drug Enforcement Administration (DEA) with assistance from the Rio Grande City Police Department launched an investigation into a crack cocaine distribution network in Rio Grande City. Following an investigation that included 20 drug transactions involving informants and undercover agents that resulted in the seizure of more than 180 grams of crack cocaine, a federal grand jury indicted 11 Rio Grande City residents including the defendants on Nov. 13, 2012. The investigation revealed the crack cocaine distribution network relied upon the use of at least four residential homes in Rio Grande City where drug buyers could purchase crack cocaine around the clock.
The evidence presented during the hearing today showed Barrientos led the crack distribution ring that included Trevino, Esteban Trevino and Alfredo Barrientos. The group sold large quantities of crack from two adjacent residences in Rio Grande City. In handing down these sentences, Judge Alvarez noted the harm the defendants had inflicted upon their community and strongly admonished them for dealing drugs from their residences in the midst of their families including small children.
Both will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The remaining nine defendants ensnared in the year-long investigation have been convicted. Today, Judge Alvarez also sentenced Jose Huerta, 29, and Eliza Escobar, 30, to 12 months in federal custody. Escobar also received a two-year-term of supervised release.
Nancy Cantu, 32, was sentenced to 48 months in federal prison followed by two years of supervised release by U.S. Chief District Court Judge Ricardo H. Hinojosa. Melissa Wolf, 48, received 33 months of incarceration from Judge Hinojosa followed by a three-year-term of supervised release. Israel Pena, 23, Luciano Lopez III, 46, and Nancy Clarke, 39, await sentencing before Judge Hinojosa on Aug. 16, 2013, at 9:30 a.m. Israel Pena, 23, is scheduled for sentencing on June 5, 2013, at 9:30 a.m. Barrientos and Esteban Trevino are scheduled for sentencing before Judge Alvarez on July 11, 2013, at 9:00 a.m.
This case was investigated by the DEA and the Rio Grande City Police Department and is being prosecuted by Assistant United States Attorneys Grady J. Leupold and Jason Honeycutt.
Last of Four Men Involved in Methamphetamine Conspiracy Sentenced in Federal CourtRead the Press Release
CHATTANOOGA, Tenn. – Shane Howell, 41, of Flintville, Tenn., was sentenced on May 20, 2013, by the Honorable Harry S. Mattice, U.S. District Court Judge, to serve 108 months in federal prison for conspiracy to manufacture and distribute methamphetamine.
Howell was the last of four individuals indicted in July 2012 and charged with conspiracy to manufacture and distribute methamphetamine, along with six other offenses related to the manufacture of methamphetamine. William Shane Reid, 34, of Flintville, Tenn.; William Scott Cunningham, 34, of Fayetteville, Tenn.; and James Thomas Hobbs, 32, of Fayetteville, Tenn., were previously sentenced by Judge Mattice in February 2013. Reid was sentenced to 170 months in federal prison, while Cunningham and Hobbs each received sentences of 70 months in prison.
This investigation, led by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), resulted in several seizures of finished methamphetamine, as well as meth labs in and around Lincoln County, Tenn. These four individuals and other uncharged conspirators are believed to be responsible for more than 200 grams of methamphetamine.
Agencies involved in this investigation included the ATF, Tennessee Bureau of Investigation and Lincoln County Sheriff’s Department. Terra L. Bay, Assistant U.S. Attorney, represented the United States.
Las Vegas Urology Practice Agrees to Pay U.S. Department of Justice $1 Million to Settle Civil Health Care Fraud AllegationsRead the Press Release
LAS VEGAS – A local urology practice, Las Vegas Urology, LLP, has agreed to pay the United States Department of Justice $1 million to resolve civil allegations that it improperly billed Medicare, TRICARE, and other federal health care insurance programs, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
The United States contends that Las Vegas Urology engaged in improper billing between Jan. 1, 2005, and June 30, 2010, to Medicare, TRICARE, the Federal Employee Health Benefits Program, and the Railroad Retirement Medicare Program. In a settlement agreement effective May 17, 2013, the parties agreed to resolve the United States claims. In consideration of the $1 million payment and an integrity agreement entered into between the federal government and Las Vegas Urology, the federal government has agreed not to seek exclusion of Las Vegas Urology from federal health care programs. In addition, the settlement agreement states that it is neither an admission of liability by Las Vegas Urology nor a concession by the United States that its claims are not well founded.
According to the Las Vegas Urology website, they have seven locations in the Las Vegas Valley and 12 physicians.
Assistant United States Attorney Roger Wenthe handled the case on behalf of the U.S. Attorney’s Office. The case was investigated by the Office of the Inspector General for the U.S. Department of Health and Human Services..
Laredoan Charged with Methamphetamine and Marijuana TraffickingRead the Press Release
LAREDO, Texas – A two-count indictment has been unsealed following the arrest of Laredo resident Santos Eliseo Carpio Jr., 33, on charges of conspiracy to possess with the intent to distribute methamphetamine and marijuana and possessing with intent to distribute methamphetamine, United States Attorney Kenneth Magidson announced today.
The sealed indictment was returned by a grand jury on Sept. 25, 2012, and unsealed late yesterday upon his arrest. He is expected to make an initial appearance before U.S. Magistrate Judge J. Scott Hacker on Wednesday, May 22, 2013.
The indictment alleges Carpio conspired to transport 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine and 1,000 kilograms or more of marijuana since July 2011. Carpio also allegedly possessed with the intent to distribute methamphetamine. If convicted, he faces a mandatory minimum sentence of 10 years and a maximum of life in prison and a possible $10 million fine.
The case is being investigated by the Drug Enforcement Administration. Assistant United States Attorney Elizabeth R. Rabe is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.Laredo Resident Charged with Defrauding the Department of LaborRead the Press Release
LAREDO, Texas – Sergio Hinojosa, 55, a resident alien living in Laredo, has been arrested and charged with conspiracy to defraud the United States, theft of public money, mail fraud and wire fraud, United States Attorney Kenneth Magidson announced today.
The sealed criminal complaint was filed Friday, May 17, and was unsealed upon his arrest by federal authorities this morning. He is set for an initial appearance tomorrow morning before U.S. Magistrate Judge Diana Song Quiroga, at which time the government expects to request his detention without bond pending further criminal proceedings.
According to the complaint, Hinojosa allegedly conspired to defraud and committed theft of government property against the Texas Workforce Commission (TWC).
Hinojosa allegedly created a scheme in which he filed fraudulent unemployment insurance claims at the request of others. The complaint alleges he would file a claim by telephone, at which time he would create a fictitious last employer including the name of the fictitious employer, address, employment dates, hourly wages and telephone number. TWC would then mail a notice of application for unemployment benefits letter to the fictitious employer to verify employment at an address Hinojosa or others allegedly controlled. Upon receipt of the letter, Hinojosa would then respond by telephone or via fax allegedly purporting to be the employer, according to the allegations.
The complaint alleges TWC would, in turn, generate a debit card, funded through the Department of Labor, and mail the card to another address controlled by Hinojosa or others.
From approximately 2008 to on or about May 13, 2013, 119 suspected fictitious claims attributed to Hinojosa had allegedly been filed, according the complaint. The estimated loss to TWC from the suspected fictitious claims is approximately $721,000.
If convicted, he faces 20 years in federal prison for each of the mail and wire fraud charges, five years for the conspiracy charge and 10 years for theft of public money. Each charge also carries a $250,000 fine as possible punishment.
The case is being investigated by Department of Labor – Office of Inspector General, FBI, the Texas Workforce Commission and Customs and Border Protection - Internal Affairs. Assistant United States Attorney Roberto Ramirez is prosecuting.
Jury Finds Congressional Campaign Finance Director Guilty of Role in Illegal Contribution SchemeRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, and Kimberly K. Mertz, Special Agent in Charge of the Federal Bureau of Investigation, today announced that a federal jury in New Haven has found ROBERT BRADDOCK, JR., 34, guilty of multiple offenses stemming from a scheme to direct illegal campaign contributions into the campaign of a candidate for the U.S. House of Representatives. The trial before U.S. District Judge Janet Bond Arterton began on May 13 and the jury returned its verdict today after deliberating for approximately two hours.
“The evidence disclosed during this trial revealed a disturbing scheme operated by individuals who believed that our federal campaign finance laws are meaningless, and that the legislative process can be easily corrupted with campaign contributions,” stated Acting U.S. Attorney Daly. “This case demonstrates exactly why our campaign finance laws exist in the first place, and why this system must be transparent. I thank the FBI for uncovering this scheme and their outstanding work during the course of this investigation. I am also proud of the efforts of our prosecution team.”
“Today’s guilty verdict is an important one because a jury of Mr. Braddock’s peers, registered voters from the State of Connecticut, has affirmed that pay-to-play schemes in the political arena will not be tolerated in their state,” stated FBI Special Agent in Charge Mertz. “Conspiring to conceal the origin of campaign donations is a serious criminal offense and those who knowingly accept conduit or straw contributions severely undermine the public’s belief in good, honest government.”
According to the trial evidence, court documents and statements made in court, in August 2011, the State of Connecticut applied for a court order enjoining Roll Your Own (“RYO”) smoke shops from continuing to operate without complying with state law governing tobacco manufacturers. RYO smoke shops are retail businesses that sell loose smoking tobacco and cigarette-rolling materials and offer customers the option of paying a “rental” fee to insert the loose tobacco and the rolling materials into a RYO machine, which is capable of rapidly rolling large quantities of cigarettes. Customers did not pay a tax on the RYO cigarettes when rolled by the RYO machines, in contrast to cigarettes purchased over-the-counter.
Paul Rogers and George Tirado co-owned Smoke House Tobacco, a RYO smoke shop with two locations in Waterbury. Fearing that the Connecticut General Assembly would enact legislation harmful to RYO smoke shop owners’ business interests during the 2012 legislative session, Rogers, Tirado, Harry Raymond “Ray” Soucy, David Moffa, Benjamin Hogan and others engaged in a scheme to direct conduit contributions into the campaign of Christopher Donovan, a candidate for the U.S. House of Representatives. At the time, Donovan was also the Speaker of the Connecticut House of Representatives. As part of the scheme, the co-conspirators recruited multiple individuals to serve as conduit contributors to the campaign. These individuals permitted checks to be written in their own names to the campaign, and certain conspirators reimbursed them with cash, thereby concealing the fact that RYO smoke shop owners were contributing to the campaign.
BRADDOCK, the Finance Director of the Donovan for Congress campaign, and Joshua Nassi, the Campaign Manager, knew that Soucy, Rogers and others opposed legislation that would harm the business interests of the RYO smoke shop owners. In November and December 2011, Rogers, Soucy, Tirado, Moffa, Hogan and others made four $2,500 conduit contributions to the Donovan for Congress campaign.
On April 3, 2012, Soucy contacted Nassi and told him that RYO owners wanted to provide additional contributions to the campaign. That same day, the Connecticut General Assembly’s Joint Committee on Finance, Revenue and Bonding voted in favor of Senate Bill 357, legislation that would have deemed RYO smoke shop owners to be tobacco manufacturers under Connecticut law, a designation that would have subjected RYO smoke shop owners to a substantial licensing fee and tax increase. Later that day, Soucy contacted Nassi again to state his displeasure with the vote.
On April 11, 2012, Soucy, Rogers and an FBI special agent working in an undercover capacity delivered four $2,500 checks in the names of conduit contributors to Nassi and Braddock. On April 23, 2012, Nassi advised Soucy that one of the checks had bounced and Soucy indicated that the contributor had been given cash to deposit. Nassi stated that the campaign needed the check by midnight the following day, and Soucy delivered a replacement check by that deadline. On May 2, 2012, the Campaign submitted a fundraising report to the Federal Election Commission (FEC) stating that the four contributions given in April were from the conduit contributors when, in fact, they were not.
Over the next two weeks, Nassi continued to advise Soucy on the status of the RYO legislation and Soucy told Nassi that he would be delivering an additional $10,000 if the legislation died. On May 9, 2012, the legislative session ended and the legislation had not been called for a vote by either chamber of the General Assembly.
On May 14, 2012, Soucy, Rogers and Hogan met at Smoke House Tobacco where Soucy provided Rogers with $10,000 in cash to be used to reimburse additional conduit contributors. Prior to the meeting, Hogan had approached Waterbury business owner Daniel Monteiro and an employee of Monteiro’s and asked them to serve as conduit contributors. Monteiro subsequently wrote a $2,500 check to the campaign, and his employee obtained a bank check in the amount of $2,500. Both were assured that they would be reimbursed. These two checks, and another $2,500 bank check drawn on Hogan’s own account but not in his name, were given to Soucy at the meeting. Also, at Nassi’s request, Rogers gave Soucy a fourth $2,500 check from a conduit contributor that was payable to a political party. Soucy delivered the four checks to Nassi at a political event later that day. As he was exiting the event, Soucy encountered BRADDOCK and stated that “twenty thousand was well worth it….And another ten grand.” BRADDOCK responded, “You’re the man.”
On May 15, 2012, BRADDOCK and Soucy had a telephone conversation related to the four conduit checks that Soucy had delivered the previous day, and BRADDOCK indicated that he needed additional identifying information for Benjamin Hogan for FEC reporting purposes. During the conversation, Soucy stated that a previous contributor “had bounced a check even though you put the money right in their hands.” He later stated, “…grabbing these drunks and drug addicts and say ‘Here, write this check…,” to which BRADDOCK responded, while laughing, “Hey, it works.”
Later that day, Soucy called BRADDOCK to inform him that Hogan was a RYO smoke shop “owner,” his check should not be deposited and that Soucy would provide a replacement check. BRADDOCK stopped the check from being deposited.
On May 16, 2012, Soucy met Nassi and provided him with a replacement $2,500 check in the name of someone who was not affiliated with any RYO shops.
In addition to the testimony of Soucy, Rogers, the undercover FBI special agent and others, the trial evidence included numerous audio and video conversations that were recorded during the course of the investigation.
BRADDOCK was found guilty of one count of conspiring to make false statements to the FEC and to defraud the U.S. by impeding the function of the FEC, one count of accepting more than $10,000 in federal campaign contributions made by persons in the names of others and one count of causing a false report to be filed with the FEC. Judge Arterton has scheduled sentencing for August 13, 2013, at which time BRADDOCK faces a maximum term of imprisonment of 12 years and a fine of up to $750,000.
Soucy, Rogers, Nassi, Moffa, Tirado, Hogan and Monteiro have pleaded guilty to charges related to this scheme and await sentencing.
This matter is being investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorneys Christopher M. Mattei and Eric J. Glover.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722 [email protected]Joplin Man Pleads Guilty to Child PornRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Joplin, Mo., man pleaded guilty in federal court today to receiving and distributing child pornography over the Internet.
Rodney Russell, 41, of Joplin, pleaded guilty before U.S. Magistrate Judge David P. Rush to the charge contained in an Oct. 3, 2012 federal indictment.
By pleading guilty today, Russell admitted that he received and distributed child pornography over the Internet between Oct. 4 and Dec. 21, 2011.
Under federal statutes, Russell is subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 20 years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney James J. Kelleher. It was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations and the Southwest Missouri Cyber Crimes Task Force.
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."Iowa Man Sentenced to 37 Years in Prison for Mailing Pipe Bombs and Threats to Investment Firms in Bid to Raise Stock PricesRead the Press Release
CHICAGO — A former Dubuque, Iowa, machinist was sentenced today to 37 years in prison for mailing a dozen threatening letters from the Chicago area and elsewhere, and mailing two pipe bombs from a Chicago suburb, between 2005 and early 2007 to investment firms and advisors as part of terror campaign to drive up the value of stock he owned in two companies. The defendant, JOHN P. TOMKINS, who signed some of his letters “THE BISHOP,” was convicted in May 2012 after a two-week trial in U.S. District Court.
Tomkins, 48, received a mandatory minimum sentence of 30 years for using a destructive device while mailing a threatening communication, which was imposed consecutively to seven years on other counts. He was convicted of two counts of possessing a unregistered destructive device and nine counts of mailing a threatening communication.
Tomkins “taunted” and “terrified” a dozen victims, who could have been seriously injured or killed, in committing “a series of horrific crimes,” U.S. District Judge Robert M. Dow, Jr., said in imposing the sentence after conducting a hearing last month. Tomkins has remained in federal custody without bond since he was arrested on April 25, 2007, following an investigation led by the U.S. Postal Inspection Service.
“Tomkins took these terrifying and secretive actions because he was greedy – because he did not like the financial and life situation in which he found himself. To remedy those perceived problems, he decided to terrorize people to get what he wanted. He was indifferent to whether he killed people in the process. For these horrific choices, that he repeatedly made over the course of two years, Tomkins received the lengthy sentence imposed today,” said Gary S. Shapiro, United States Attorney for the Northern District of Illinois.
“Through an intensive investigation, the U.S. Postal Inspection Service identified Tomkins before his behavior led to victims sustaining severe physical injuries or even death. Although this sentencing brings Tomkins’ acts of terror to a close, his victims will live forever with the pain they suffered because of him. The Postal Inspection Service takes any crime involving the mail very seriously and we will continue to investigate individuals who misuse the U.S. mail to commit crime,” said Pete Zegarac, Inspector-in-Charge of the Chicago Division of the U.S. Postal Inspection Service.
The evidence at trial showed that the two unregistered destructive devices were each mailed on Jan. 26, 2007, at the Rolling Meadows Post Office, northwest of Chicago. One package was addressed to an individual at Janus Small Cap at an address in Denver, where it was forwarded unopened by Janus to a related investment entity in Chicago. The second parcel was addressed to an individual at American Century at an address in Kansas City, Mo. Upon delivery, authorities were notified and both parcels were recovered by Postal Inspectors.
Each parcel contained an improvised explosive weapon, commonly known as a pipe bomb. Expert testimony at trial showed that they were functional, even though the firing circuit was not fully connected, and they were capable of exploding as a result of jostling or impact and causing serious injury or death to persons near the explosion. Each parcel contained a letter stating, in part: “BANG!! YOU’RE DEAD.”
Tomkins was convicted of mailing a dozen threatening letters to investment companies and individuals associated with them between May 23, 2005, and July 17, 2006. The typewritten letters bore postmarks from Chicago, Palatine, Milwaukee, Des Moines and Orlando, Fla., and some were signed “THE BISHOP,” while others ended with the words “TIC TOC.” The first letter, for example, stated how easy it is to kill someone, citing “The Unibomber” (sic) and “Salvo,” a reference to convicted sniper Lee Malvo. In addition to threatening language, some of the letters demanded that the price of the former 3Com Corporation (COMS) stock be raised to $6.66 by a certain date. Other demands were made for a rally in the stock price of Navarre Corporation, a publicly-traded technology and entertainment company that traded under the ticker symbol NAVR.
Evidence also included U.S. Securities and Exchange Commission records showing individuals with positions of at least 200 option contracts. Two reports each obtained for 3Com and Navarre identified Tomkins as the only investor whose account appeared in those reports at certain times dating back to 2005. Trading records showed that Tomkins held financial interests in 3Com and Navarre that would have increased in value had the securities moved in the directions demanded in the threatening letters and when the pipe bombs were mailed.
One the day he was arrested, law enforcement officials searched storage garages rented by Tomkins in Dubuque and recovered two additional assembled pipe bombs similar to the ones that were mailed, as well as all of the components used in making the mailed devices. For example, inspectors discovered store receipts for shotgun shells containing the explosive powder that was used in the mailed pipe bombs and was purchased in Madison, Wis., 23 days before the two package bombs were mailed. Inspectors also found a receipt for end caps used to assemble the devices that were purchased in Dubuque just two days before they were mailed in January 2007.
The government was represented by Assistant U.S. Attorneys Patrick C. Pope and Paul H. Tzur.
The investigation was led by the U.S. Postal Inspection Service, joined by agents from the Federal Bureau of Investigation’s Joint Terrorism Task Force and the Bureau of Alcohol Tobacco Firearms and Explosives. The SEC, the Illinois State Police, the Iowa Department of Public Safety, the Dubuque, Kansas City and Chicago police departments, the Quad Cities Bomb Squad, and the U.S. Attorney’s Office in the Northern District of Iowa also assisted in the investigation.
Four More Defendants Sentenced in Major Methamphetamine ConspiracyRead the Press Release
Next Sentencings Set for June 7, 2013
WICHITA FALLS, Texas — On Friday, May 17, 2013, four additional defendants, who pleaded guilty to their respective roles in a major methamphetamine distribution conspiracy that operated in Wichita Falls, were sentenced by U.S. District Judge Reed C. O’Connor, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
The following defendants were sentenced on Friday:
- Anthony DiPalma, 32, sentenced to 188 months
- Jason Brent Hoffman, 36, sentenced to 120 months
- Debra McCulloch, 59, sentenced to 50 months
- McKayla Fondren, 21, sentenced to 24 months
DiPalma and Fondren each pleaded guilty to one count of possession with intent to distribute and distribution of methamphetamine. Hoffman admitted being a felon in possession of a firearm and McCulloch pleaded guilty to one count of conspiracy to possess with intent to distribute and to distribute and to possess with intent to manufacture and manufacture methamphetamine.
DiPalma admitted that on March 28, 2012, he possessed with intent to distribute and distributed five grams or more of methamphetamine.
Hoffman, who has both state and federal drug convictions, admitted that in October 2011, he possessed a 9 mm pistol, which he sold to an undercover agent.
McCulloch admitted that on multiple occasions between June and September 2012, she distributed, and facilitated the ability of co-conspirators, to distribute methamphetamine. She also admitted allowing co-defendants Steve Ysasaga and David Calandreli to store quantities of methamphetamine, as well as proceeds from the sale of the methamphetamine, at her residence on 30th Street in Wichita Falls.
Fondren admitted that in June 2012, when officers with the Wichita Falls Police Department executed a state search warrant at her residence on Dee Drive in Wichita Falls, they found more than 15 grams of methamphetamine, as well as a digital scale and a small tub of MSM, a substance used to dilute or cut methamphetamine.
Several more defendants convicted in the conspiracy are scheduled to be sentenced on June 7, 2013. To date, 29 of the 30 defendants charged in this conspiracy have entered guilty pleas; a total of 19 defendants have been sentenced. The case against one defendant has not been resolved.
This Organized Crime and Drug Enforcement Task Force (OCDETF) case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Texas Department of Public Safety and the Wichita Falls Police Department. Assistant U.S. Attorney Mary F. Walters is in charge of the prosecution.
Former School Board Member Sentenced for Cocaine TraffickingRead the Press Release
SHREVEPORT, La. – United States Attorney Stephanie A. Finley announced today that former DeSoto Parish School Board member Bartholomew Claiborne, 31, of Mansfield, was sentenced by U.S. District Judge Elizabeth E. Foote, to one year and one day in prison and three years supervised release for distributing cocaine.
According to evidence presented at the guilty plea, Claiborne distributed cocaine and other controlled substances on 14 separate occasions between Oct. 11, 2011 and July 12, 2012. Authorities used surveillance methods to observe Claiborne selling cocaine.“As an elected official, Bartholomew Claiborne swore to uphold the law, and by his own admission, failed to do so,” Finley stated. “He has failed the children and parents of the school board district where he served as a role model. We hope this case sends a message that public officials are not above the law. We will continue to prosecute those who violate federal laws. I would like to thank all of the federal, state and local agencies who participated in the investigation.”
Claiborne was the first to be indicted as part of the Organized Crime Drug Enforcement Task Force (OCDETF) “Operation Limpiar Casa,” an operation targeting drug trafficking in the Mansfield area. The FBI, the DEA, the DeSoto Parish Sheriff’s Office, the Mansfield Police Department and the Tri-Parish Task Force which includes DeSoto, Sabine and Red River parishes, participate in the OCDETF program and conducted the operation.
The OCDETF program is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.First Assistant U.S. Attorney Alexander C. Van Hook prosecuted the case.
Former Moberly Correctional Center Inmate Sentenced on Federal Conspiracy ChargesRead the Press Release
St. Louis, MO -Anthony Johnson and his two associates referred to themselves as the “Hilton” family. Between July 2009 and March 2011, Johnson engaged in a conspiracy to steal identification information of unsuspecting victims, open new credit accounts using the stolen identities and use the fraudulent credit accounts to deposit money into the accounts of inmates at the Moberly Correctional Center (MCC). Today he was sentenced to 60 months in prison and ordered to pay restitution of $80,000.
According to Johnson’s plea documents, once they obtained credit accounts, they wire-transferred money into the accounts of inmates, which was then sent to Johnson's co-defendants and other people outside of MCC.
ANTHONY JOHNSON pled guilty in February to one felony count of conspiracy to commit identity theft and three felony counts of identity theft. He appeared today for sentencing before United States District Judge Henry Autrey.
Co-defendants Cedric Walton, Memphis, TN, was indicted on the conspiracy count and one count of identity theft; and Timothy Moore, Memphis, TN, was indicted on conspiracy. Their cases are still pending.
Conspiracy carries a maximum penalty of five years in prison and/or fines up to $250,000; each count of identity theft carries a maximum penalty of 15 years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Postal Inspection Service; the Federal Bureau of Investigation; the Moberly, Missouri Police Department and the Missouri Department of Corrections. Assistant United States Attorney Reginald Harris is handling the case for the U.S. Attorney's Office.As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Defendants Walton and Moore are presumed to be innocent unless and until proven guilty.
Former KC Man Indicted for Child PornRead the Press Release
Project Safe Childhood
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a former Kansas City, Mo., resident was indicted by a federal grand jury today for producing child pornography.
Paul Leslie Kannarr, 68, formerly of Kansas City, was charged in a 10-count indictment returned by a federal grand jury in Kansas City.
Today’s indictment alleges that Kannarr used a minor, identified as “Jane Doe,” to produce child pornography on six separate occasions between Dec. 19, 1999 and Sept. 23, 2000. The indictment also charges Kannarr with two counts of posting a notice online that offers to display or distribute child pornography, one count of transporting child pornography over the Internet and one count of possessing child pornography.
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 Katharine Fincham. It was investigated by the Kansas City, Mo., Police Department and the FBI Cyber Crimes Task Force.
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."Former High-ranking Official at NYC Department of Housing Preservation and Development Sentenced to 18 Months in PrisonRead the Press Release
Earlier today, Michael Provenzano, formerly Director of Construction Services for the New York City Department of Housing Preservation and Development (HPD), was sentenced to a term of imprisonment of 18 months followed by three years of supervised release, and ordered to pay $30,000 restitution to the City of New York and a $5,000 fine following his corruption conviction for taking bribes. As part of his sentence, Provenzano also was ordered to forfeit the $30,000 in bribery money to the government, representing the proceeds of his crime. The sentence was imposed by United States District Judge Nina Gershon at the federal courthouse in Brooklyn, New York.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York; George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Robert Panella, Special Agent-in-Charge, United States Department of Labor (DOL) Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; and Rose Gill Hearn, Commissioner, New York City Department of Investigation (DOI).
From approximately January 2007 through December 2009, Provenzano solicited and received $30,000 in bribe payments from a contractor who had extensive construction contracts with HPD, the largest municipal developer of affordable housing in the United States. The contractor paid Provenzano the bribes in return for, among other things, Provenzano leaking to the contractor confidential HPD inspection reports, which documented the number of workers at a given work site. The contractor was regularly and illegally employing additional workers at different work sites and paying them less than the legally-required prevailing wage. With these leaked inspection reports, the contractor was able to conform his invoices to match the reports, thereby avoiding detection by HPD for his illegal conduct in paying those additional workers less than the prevailing wage.
Today’s sentencing proceeding is the first stemming from the government’s wide-ranging investigation into fraud involving the affordable housing industry in New York City. Four real estate developers and two other former HPD officials have pleaded guilty to various charges including racketeering conspiracy, fraud, and bribery related to the development of affordable housing in New York City. Three additional defendants await trial.
“Provenzano admitted taking bribes to provide a developer with confidential information that helped that developer exploit his workers. Today’s sentence sends a clear message: any public servant, whether a legislator or an appointed official, who dips his hand in the public till will be prosecuted to the fullest extent of the law. Serving the public is a privilege, not an opportunity for unjust enrichment. We will continue to root out public corruption wherever we find it,” stated United States Attorney Lynch. Ms. Lynch thanked the Internal Revenue Service, Criminal Investigation, New York; the United States Department of Housing and Urban Development; and the New York City Police Department for their assistance in this case.
FBI Assistant Director-in-Charge Venizelos stated, “By his admission, Provenzano was for sale. For a fee, he provided information that benefitted a contractor rather than serving the interests of the city, his agency and the public.”
“Today’s sentencing highlights the Office of Inspector General’s commitment to combat fraud and corruption involving publicly funded construction contracts. The OIG will continue to work with our law enforcement partners to investigate those who facilitate the circumvention of prevailing wage laws for personal gain,” stated DOL/OIG Special Agent-in-Charge Panella.
DOI Commissioner Rose Gill Hearn said, “This defendant should have protected HPD’s construction process. Instead, he traded his integrity so he could pocket tens of thousands of dollars in bribes. Now, he reaps the serious consequences of his crimes: conviction, prison, and the loss of a valuable City job.”
The government’s case is being prosecuted by Assistant United States Attorneys Cristina M. Posa, Anthony Capozzolo, and Claire Kedeshian.
The Defendant:
MICHAEL PROVENZANO
Massapequa, New York
Age: 49Former Guard Sentenced to Prison for Tax CrimesRead the Press Release
A former federal correctional officer from the Federal Correctional Institution at Greenville was sentenced to a total of six months in prison, a year of supervised release, and $22,108 in restitution to the IRS, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Attillah Ruffin, 43, waived her right to be indicted by the Grand Jury and pled guilty to an Information in US District Court on January 28, 2013, for filing false tax returns. Ruffin admitted falsifying her personal income tax returns each tax year from 2005-2010. During that time period she defrauded the US Government out of $22,108 by claiming false dependents, false child care expenses, false unreimbursed employee expenses, and false residential energy credits. Ruffin also admitted to fraudulently obtaining a larger tax refund by using an inapplicable filing status by claiming to be a “head of household” when her filing status should have been “single.” Ruffin admitted that these crimes occurred while she was employed as a law enforcement officer for the Federal Bureau of Prisons.
Ruffin was sentenced to serve three months of her sentenced while imprisoned at the Bureau of Prisons, with 3 additional months to be served as home confinement. In addition to paying restitution, she was ordered not to open any credit accounts without prior approval and she was directed to undergo counseling for gambling while also signing a self-exclusion from area gaming establishments.
The investigation was conducted by agents from the Internal Revenue Service Criminal Investigations. The case was prosecuted by Assistant United States Attorney Steven D. Weinhoeft.
Florence Inmate Sentenced for Stabbing Fellow Inmate with Homemade KnifeRead the Press Release
DENVER – Michael Kelewood, age 27, an inmate in the U.S. Bureau of Prisons system, was sentenced last week by U.S. District Court Judge William J. Martinez to serve 84 months for assault with a dangerous weapon, U.S. Attorney John Walsh and FBI Denver Special Agent in Charge Thomas Ravenelle announced. Judge Martinez ordered that Kelewood serve his 84 month prison sentence consecutive to his prior sentence of 71 months for assault with a dangerous weapon with intent to do bodily harm. If Kelewood had not committed the assault he would have gotten out of prison next month (June 2013). Once Kelewood ultimately is released from prison, he was ordered to spend 3 years on supervised release.
Kelewood was indicted by a federal grand jury in Denver on August 20, 2012. He pled guilty February 12, 2013. He was sentenced on May 15, 2013.
According to court records, including the stipulated facts contained in the plea agreement, on April 5, 2012, at approximately 12:46 p.m., Kelewood, an inmate at the United States Penitentiary in Florence, Colorado, pulled out a homemade knife and stabbed a fellow inmate as the victim watched television in the common recreation room. Kelewood stabbed the victim inmate several times in the neck, shoulder and eye, resulting in hospitalization for several weeks, with injuries that included a fractured bone in his spine. The investigators determined that Kelewood believed it was his responsibility as a member of the Natives prison gang to stab the victim, with the intention of hurting but not killing him.
“Prosecuting prison assault cases is a critical part of protecting inmates and maintaining the good order of the prison system,” said U.S. Attorney John Walsh. “Vicious attacks like this one will not be tolerated. Those who are responsible will be prosecuted to the full extent of the law.”
“The FBI’s partnership with the Federal Bureau of Prisons and the United States Attorney’s Office ensures that violent criminals, even when incarcerated, are held accountable for their actions,” said FBI Denver Special Agent in Charge Thomas Ravenelle. “This serves as a deterrent to promote a safe and orderly environment for both staff and inmates in the Federal Prison System.”
This case was investigated by the FBI with support from the U.S. Bureau of Prisons.
Kelewood was prosecuted by Assistant U.S. Attorney Colleen Covell.
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Final Guilty Plea in Aryan Knights InvestigationRead the Press Release
BOISE – Joshua Nall, 31, of Boise, pleaded guilty today in United States District Court to unlawfully possessing a firearm, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, Nall admitted that on April 13, 2012, he possessed a Glock .40 pistol, which he provided to a confidential informant. Nall was prohibited from possessing the pistol because he was previously convicted of the felony crime of unlawful possession of a firearm in 2008.
The charge is punishable by up to ten years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Nall is set for sentencing on August 20, 2013, before the Chief U.S. District Judge B. Lynn Winmill, at the federal courthouse in Boise.
Nall’s case is part of a larger investigation involving the Aryan Knights gang, in which 23 people were charged with drug trafficking and firearms violations. Nall is the 23rd person to plead guilty. Fifteen of the 23 people have already been sentenced while the others are awaiting sentencing. The charges are a result of a long-term investigation by the Treasure Valley Metro Violent Crimes Task Force. The investigation began when the task force focused on illegal drug distribution by the “Aryan Knights,” a gang active in prison and on the streets throughout Idaho. Through the investigation, law enforcement agents identified Aryan Knights gang members who were trafficking methamphetamine, as well as associates of the gang who were the source of that methamphetamine.
The Treasure Valley Metro Violent Crimes Task Force is comprised of federal, state and local agencies, including the Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms and Explosives, Boise Police Department, Ada County Sheriff’s Office, Caldwell Police Department, Nampa Police Department, Meridian Police Department, Canyon County Sheriff’s Office, and the Idaho Department of Corrections. The Organized Crime and Drug Enforcement Task Force (OCDETF) also contributed to the investigation, including the cooperative law enforcement efforts of the Federal Bureau of Investigation, Drug Enforcement Administration, Bureau of Alcohol, Tobacco, Firearms and Explosives, U. S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Internal Revenue Service-Criminal Investigation, and U.S. Marshals Service.
Nall’s case is being prosecuted by the Special Assistant U.S. Attorney hired by the Treasure Valley Partnership and the State of Idaho to address gang crimes. The Treasure Valley Partnership is comprised of a group of elected officials in southwest Idaho dedicated to regional coordination, cooperation, and collaboration on creating coherent regional growth. For more information, visit treasurevalleypartners.org.
Felon Convicted of Drug Trafficking and Firearms ChargesRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Tabari Facen, 36, of Rochester, N.Y. was convicted after a jury trial of possessing 28 grams or more of crack cocaine with intent to distribute, maintaining a drug-involved premises, possessing a firearm in furtherance of drug trafficking crimes, and possessing a firearm and ammunition while being a convicted felon. The defendant, who has a prior state drug trafficking conviction, faces a mandatory minimum penalty of 15 years in prison, a maximum of life, an $8,000,000 fine or both.
Assistant U.S. Attorneys Charles E. Moynihan and Craig R. Gestring, who handled the prosecution of the case at trial, stated that Facen was arrested following the execution of a search warrant at 303 Lakeview Park in Rochester on September 26, 2011 by the Greater Rochester Area Narcotics Enforcement Team. Upon entering the location, officers encountered and arrested the defendant in the master bedroom of the location. In searching the house, officers located and seized over 53 grams of crack cocaine and paraphernalia used to distribute crack cocaine (including digital scales and small ziplock bags) which were secreted in various places throughout the residence. Officers also found a loaded .40 caliber Smith & Wesson handgun, two loaded handgun magazines, and over 100 rounds of ammunition of various calibers.
“As all are aware, Rochester has experienced a rash of violence of late," said U.S. Attorney Hochul. "Much of that violence is committed with firearms. Thanks to today’s verdict, a defendant who possessed both firearms and drugs, and is a prior felon to boot, has now been removed from Rochester for what will be a very long time. The public should be assured that we will continue to target other offenders who engage in either violence or gun related offenses.”
The conviction is the result on an investigation by the Greater Rochester Area Narcotics Enforcement Team composed of law enforcement personnel from the Bureau of Alcohol, Tobacco, Firearms and Explosives under the direction of Resident Agent in Charge Scott Heagney, the Rochester Police Department, under the direction of Chief James M. Sheppard, and the Brighton Police Department, under the direction of Chief Mark Henderson.Sentencing is scheduled for September 4, 2013 before U.S. District Court Judge David G. Larimer.
Federal Jury Convicts Lea County Man on Firearms ChargesRead the Press Release
ALBUQUERQUE – A federal jury sitting in Las Cruces, N.M., returned a guilty verdict this afternoon against Cody Allen Little, 34, of Lovington, N.M., on a two-count superseding indictment alleging violations of the federal firearms laws after a two-day trial. The verdict was announced by U.S. Attorney Kenneth J. Gonzales, 5th Judicial District Attorney Janetta B. Hicks, and Thomas G. Atteberry, Special Agent in Charge of the Phoenix Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Little was arrested on a criminal complaint in June 2012, and subsequently was charged with being a felon in possession of firearms and ammunition and possession of stolen firearms in a superseding indictment. The superseding indictment alleged that Little unlawfully possessed firearms and ammunition, including a stolen assault rifle and a stolen shotgun, on Nov. 1, 2011, in Lea County, N.M. At the time, Little was prohibited from possessing firearms or ammunition because he previously had been convicted of the following felony offenses in the 5th Judicial District Court for the State of New Mexico in Lea County: (1) burglary, battery on a peace officer and possession of drug paraphernalia, (2) battery on a peace officer and resisting an officer, and (3) burglary and larceny.
According to the evidence at trial, on the night of Oct. 24, 2011, the “Southwest Arms,” a gun shop in Lovington that was owned and operated by a federal firearms licensee (FFL), was burglarized and seven weapons, including several assault rifles, were stolen. Within days, law enforcement authorities and the FFL received tips that led officers to focus on Little, who was renting in a converted well-house located on a residential property less than half a mile away from the gun shop, as a potential suspect in the burglary.
On Nov. 1, 2011, officers went to the residential property on which the well-house was located to follow up on the tips. While speaking with an individual at the residence, the officers saw Little walk out of the well-house and away from the area where the officers were standing, and disappear from sight. When an officer walked to the area where Little was last seen, he observed a storage shed with its doors secured in the open position. Glancing into the shed, the officer observed parts of an AR 15 style assault rifle and AR 15 style assault rifles in plain view.
After obtaining a search warrant for the property, officers recovered two firearms and ammunition from the well-house where Little was living. The first firearm, a .308 caliber assault rifle with a loaded 19-round magazine, was found inside a sleeping bag in the well-house. The second, a 12 gauge shotgun, was found under the bed in the well-house. Two shot gun shells were found on a shelf above the bed. Both firearms were among the weapons stolen from the gun shop on Oct. 24, 2011. After confirming that Little was residing in the well-house, the officers arrested Little on state charges on Nov. 2, 2011.
The jury deliberated approximately 50 minutes before returning a guilty verdict on both counts of the superseding indictment.
The state charges against Little were dismissed after he was arrested on federal charges. Little has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has not yet been scheduled. Little faces a maximum sentence of ten years in prison unless the court determines that he is an armed career criminal. In that event, Little faces a mandatory minimum sentence of 15 years in prison.
U.S. Attorney Kenneth J. Gonzales said that the case was prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this anti-violence initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.District Attorney Janetta B. Hicks noted, “Our partnership with the U. S. Attorney’s Office is integral to reducing the violence in southeastern New Mexico. It is imperative to remove armed felons from our community.”
“Anytime we can prevent a prohibited felon from possessing this much firepower, our communities are safer,” stated ATF Special Agent in Charge, Thomas G. Atteberry. “I want to commend the leadership of U.S. Attorney Kenneth J. Gonzales and his prosecution team, in addition to the dedicated ATF agents and local law enforcement that perfected this criminal case.”
The case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives with assistance from the 5th Judicial District Attorney’s Office, the Lovington Police Department and the Lea County Sheriff’s Department, and is being prosecuted by Assistant U.S. Attorneys Marisa A. Lizarraga, Shaheen P. Torgoley and Mick I.R. Gutierrez of the U.S. Attorney’s Las Cruces Branch Office.Federal Jury Convicts Lea County Man on Firearms ChargesRead the Press Release
ALBUQUERQUE – A federal jury sitting in Las Cruces, N.M., returned a guilty verdict this afternoon against Cody Allen Little, 34, of Lovington, N.M., on a two-count superseding indictment alleging violations of the federal firearms laws after a two-day trial. The verdict was announced by U.S. Attorney Kenneth J. Gonzales, 5th Judicial District Attorney Janetta B. Hicks, and Thomas G. Atteberry, Special Agent in Charge of the Phoenix Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Little was arrested on a criminal complaint in June 2012, and subsequently was charged with being a felon in possession of firearms and ammunition and possession of stolen firearms in a superseding indictment. The superseding indictment alleged that Little unlawfully possessed firearms and ammunition, including a stolen assault rifle and a stolen shotgun, on Nov. 1, 2011, in Lea County, N.M. At the time, Little was prohibited from possessing firearms or ammunition because he previously had been convicted of the following felony offenses in the 5th Judicial District Court for the State of New Mexico in Lea County: (1) burglary, battery on a peace officer and possession of drug paraphernalia, (2) battery on a peace officer and resisting an officer, and (3) burglary and larceny.
According to the evidence at trial, on the night of Oct. 24, 2011, the “Southwest Arms,” a gun shop in Lovington that was owned and operated by a federal firearms licensee (FFL), was burglarized and seven weapons, including several assault rifles, were stolen. Within days, law enforcement authorities and the FFL received tips that led officers to focus on Little, who was renting in a converted well-house located on a residential property less than half a mile away from the gun shop, as a potential suspect in the burglary.
On Nov. 1, 2011, officers went to the residential property on which the well-house was located to follow up on the tips. While speaking with an individual at the residence, the officers saw Little walk out of the well-house and away from the area where the officers were standing, and disappear from sight. When an officer walked to the area where Little was last seen, he observed a storage shed with its doors secured in the open position. Glancing into the shed, the officer observed parts of an AR 15 style assault rifle and AR 15 style assault rifles in plain view.
After obtaining a search warrant for the property, officers recovered two firearms and ammunition from the well-house where Little was living. The first firearm, a .308 caliber assault rifle with a loaded 19-round magazine, was found inside a sleeping bag in the well-house. The second, a 12 gauge shotgun, was found under the bed in the well-house. Two shot gun shells were found on a shelf above the bed. Both firearms were among the weapons stolen from the gun shop on Oct. 24, 2011. After confirming that Little was residing in the well-house, the officers arrested Little on state charges on Nov. 2, 2011.
The jury deliberated approximately 50 minutes before returning a guilty verdict on both counts of the superseding indictment.
The state charges against Little were dismissed after he was arrested on federal charges. Little has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has not yet been scheduled. Little faces a maximum sentence of ten years in prison unless the court determines that he is an armed career criminal. In that event, Little faces a mandatory minimum sentence of 15 years in prison.
U.S. Attorney Kenneth J. Gonzales said that the case was prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this anti-violence initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.District Attorney Janetta B. Hicks noted, “Our partnership with the U. S. Attorney’s Office is integral to reducing the violence in southeastern New Mexico. It is imperative to remove armed felons from our community.”
“Anytime we can prevent a prohibited felon from possessing this much firepower, our communities are safer,” stated ATF Special Agent in Charge, Thomas G. Atteberry. “I want to commend the leadership of U.S. Attorney Kenneth J. Gonzales and his prosecution team, in addition to the dedicated ATF agents and local law enforcement that perfected this criminal case.”
The case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives with assistance from the 5th Judicial District Attorney’s Office, the Lovington Police Department and the Lea County Sheriff’s Department, and is being prosecuted by Assistant U.S. Attorneys Marisa A. Lizarraga, Shaheen P. Torgoley and Mick I.R. Gutierrez of the U.S. Attorney’s Las Cruces Branch Office.Federal Jury Convicts Lea County Man on Firearms ChargesRead the Press Release
ALBUQUERQUE – A federal jury sitting in Las Cruces, N.M., returned a guilty verdict this afternoon against Cody Allen Little, 34, of Lovington, N.M., on a two-count superseding indictment alleging violations of the federal firearms laws after a two-day trial. The verdict was announced by U.S. Attorney Kenneth J. Gonzales, 5th Judicial District Attorney Janetta B. Hicks, and Thomas G. Atteberry, Special Agent in Charge of the Phoenix Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Little was arrested on a criminal complaint in June 2012, and subsequently was charged with being a felon in possession of firearms and ammunition and possession of stolen firearms in a superseding indictment. The superseding indictment alleged that Little unlawfully possessed firearms and ammunition, including a stolen assault rifle and a stolen shotgun, on Nov. 1, 2011, in Lea County, N.M. At the time, Little was prohibited from possessing firearms or ammunition because he previously had been convicted of the following felony offenses in the 5th Judicial District Court for the State of New Mexico in Lea County: (1) burglary, battery on a peace officer and possession of drug paraphernalia, (2) battery on a peace officer and resisting an officer, and (3) burglary and larceny.
According to the evidence at trial, on the night of Oct. 24, 2011, the “Southwest Arms,” a gun shop in Lovington that was owned and operated by a federal firearms licensee (FFL), was burglarized and seven weapons, including several assault rifles, were stolen. Within days, law enforcement authorities and the FFL received tips that led officers to focus on Little, who was renting in a converted well-house located on a residential property less than half a mile away from the gun shop, as a potential suspect in the burglary.
On Nov. 1, 2011, officers went to the residential property on which the well-house was located to follow up on the tips. While speaking with an individual at the residence, the officers saw Little walk out of the well-house and away from the area where the officers were standing, and disappear from sight. When an officer walked to the area where Little was last seen, he observed a storage shed with its doors secured in the open position. Glancing into the shed, the officer observed parts of an AR 15 style assault rifle and AR 15 style assault rifles in plain view.
After obtaining a search warrant for the property, officers recovered two firearms and ammunition from the well-house where Little was living. The first firearm, a .308 caliber assault rifle with a loaded 19-round magazine, was found inside a sleeping bag in the well-house. The second, a 12 gauge shotgun, was found under the bed in the well-house. Two shot gun shells were found on a shelf above the bed. Both firearms were among the weapons stolen from the gun shop on Oct. 24, 2011. After confirming that Little was residing in the well-house, the officers arrested Little on state charges on Nov. 2, 2011.
The jury deliberated approximately 50 minutes before returning a guilty verdict on both counts of the superseding indictment.
The state charges against Little were dismissed after he was arrested on federal charges. Little has been in federal custody since his arrest and remains detained pending his sentencing hearing, which has not yet been scheduled. Little faces a maximum sentence of ten years in prison unless the court determines that he is an armed career criminal. In that event, Little faces a mandatory minimum sentence of 15 years in prison.
U.S. Attorney Kenneth J. Gonzales said that the case was prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this anti-violence initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.District Attorney Janetta B. Hicks noted, “Our partnership with the U. S. Attorney’s Office is integral to reducing the violence in southeastern New Mexico. It is imperative to remove armed felons from our community.”
“Anytime we can prevent a prohibited felon from possessing this much firepower, our communities are safer,” stated ATF Special Agent in Charge, Thomas G. Atteberry. “I want to commend the leadership of U.S. Attorney Kenneth J. Gonzales and his prosecution team, in addition to the dedicated ATF agents and local law enforcement that perfected this criminal case.”
The case was investigated by the Las Cruces office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives with assistance from the 5th Judicial District Attorney’s Office, the Lovington Police Department and the Lea County Sheriff’s Department, and is being prosecuted by Assistant U.S. Attorneys Marisa A. Lizarraga, Shaheen P. Torgoley and Mick I.R. Gutierrez of the U.S. Attorney’s Las Cruces Branch Office.Ellington, Missouri, Bank Manager Sentenced on Federal Bank Fraud and Embezzlement ChargesRead the Press Release
Cape Girardeau, MO - Irvin R. Eddington, Jr. was sentenced Monday afternoon to 57 months in prison on bank fraud and embezzlement charges involving his issuance of fraudulent letters of credit while he was Vice President and Manager of the Ellington Branch of People’s Community State Bank (PCSB). In addition to the prison sentence, he was ordered to pay restitution of $1,195,696.
From February to October 2011, Eddington created fraudulent PCSB money orders funded by advances from customer lines of credit to obtain cash or pay his bills. In order to execute his scheme, he would issue money orders payable to a bank loan customer or to a creditor and endorse by forging the customer's name. In each instance, Eddington misrepresented to the teller that the customer had been in earlier that day, endorsed the money order and he was handling the transaction in the customer's stead. In order to evade detection by customers, he used lines of credit from customers who he knew did not monitor their loan histories and who did not have access to their account online. In order to further evade detection, he would sometimes deliberately not mail the customers he targeted their bank statements.
From January 2004 through October 2011, Eddington created and issued numerous fraudulent unsecured irrevocable letters of credit to an associate in the name of PCSB worth approximately $1,340,896. He did not have authority to issue any of these letters of credit and did so without the knowledge or permission of the bank. Unbeknownst to PCSB, this associate then secured loans from other entities using the irrevocable letters of credit as collateral. The associate kept and used the funds derived from those loans leaving PCSB responsible for the balance in the instance of a default. Contrary to his fiduciary duty as a bank Vice President to disclose all letters of credit issued by him, Eddington deliberately failed to discuss the unauthorized letters when the subject was discussed at bank board meetings. The total value of the letters of credit issued and thus the potential loss to the bank for this scheme, was approximately $1,340,896, however, based on loan defaults to date, PCSB is liable for approximately $674,336.
Besides the conduct described above, Eddington also admitted to perpetrating additional fraudulent schemes on PCSB. On March 11, 2010, Eddington, in an effort to circumvent Federal Reserve regulations governing insider lending to bank officers, approved a nominee loan to two customers of the bank for $45,000. He reported the loan to PCSB; however, did not report he was receiving the proceeds of the loan. The loss to PCSB for this scheme was $58,500.On August 4, 2011, the PCSB Loan Committee approved a $249,000 loan to an associate of Eddington. He misrepresented collateral for the loan by providing a fraudulent title insurance policy as part of the loan application. Finally, when the $249,000 loan was presented for approval, Eddington failed to disclose that the associate would receive $56,114 cash from the loan proceeds. The Loan Committee would not have approved the loan had they known that the loan was "secured" by different property, the lack of title insurance and the cash payout to the borrower.
IRVIN R. EDDINGTON, JR., Ellington, MO, pled guilty in February to one felony count of bank fraud and one felony count of embezzlement by a bank employee. He appeared Monday afternoon for sentencing in Cape Girardeau before United States District Judge Carol E. Jackson.
This case was investigated by Federal Deposit Insurance Corporation-Office of Inspector General, U.S. Postal Inspectors, U.S. Department of Agriculture-Office of Inspector General, U.S. Secret Service, Federal Housing Finance Agency-Office of Inspector General. Assistant United States Attorney Stephen Casey handled the case for the U.S. Attorney’s Office.