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Thursday 7 March 2013
Former New Mexico Corrections OfficerConvicted on Obstruction of Justice ChargesRead the Press Release
A federal jury late yesterday convicted Kevin Casaus, 25, a former corrections officer at the Bernalillo County, N.M., Metropolitan Detention Center (MDC) in Albuquerque, N.M., on obstruction of justice and falsification of records charges, announced the Justice Department.
Casaus and fellow former MDC corrections officers, Demetrio Juan Gonzales, 40, and Matthew Pendley, 26, were indicted in June 2012, and charged with various crimes related to the assault of an inmate housed at MDC on Dec. 21, 2011, and subsequent attempts to cover up and impede the investigation of the assault. In Oct. 2012, Gonzales pleaded guilty to violating the civil rights of an individual in his custody when he struck and choked the victim in the shower room/dress out area of MDC. Pendley pleaded guilty in Feb. 2012 to obstructing justice by making false statements to law enforcement during their investigation of the assault on an inmate.
According to the evidence at trial, during the early morning hours of Dec. 21, 2011, Gonzales was assigned to the Receiving-Discharge-Transfer (RDT) Unit at MDC where individuals are brought to be booked soon after they are arrested. His job was to photograph and fingerprint those who are brought to RDT for booking. The victim, who had been arrested for Driving While Intoxicated, was verbally uncooperative during the booking process, but was not a physical threat to anyone. Gonzales testified that he became angry at the victim and walked him to the shower room where he knew there were no surveillance cameras. Several other corrections officers, including Casaus, followed Gonzales to the shower room. There, Gonzales physically assaulted the victim, striking him multiple times, and choking him. Gonzales testified that he beat the victim “in a blind rage” and then had to wash the victim’s blood off his hands. He further testified that the victim did not do anything to justify the beating.
According to the testimony, Casaus and two other corrections officers were present in the shower room during the beating. Additionally, a former inmate who was in the hallway outside the shower room at the time of the beating, overheard groans and sounds consistent with the assault coming from the shower room. He was then tasked with cleaning the blood that was on the floors and walls of the shower room. The victim testified that, after Gonzales left the shower room, Casaus assaulted him by shoving him and striking him. Casaus falsely stated during a recorded interview with a Bernalillo County Sheriff’s Office investigator that the victim was not assaulted in the shower room, the victim was not bleeding, and that they only brought the victim to the shower room to ask him to change out of his clothes. Casaus falsified his report when he wrote that he saw blood on the victim's clothes, but did not know where the blood came from.
The jury deliberated approximately four hours before returning a verdict of guilty on the obstruction of justice and falsification of records charges, and not guilty on the assault charge.
“Today's verdict affirms that law enforcement officers are not above the very laws they are sworn to uphold,” said Assistant Attorney General Thomas E. Perez. “As in this case, the Civil Rights Division will work closely with our United States Attorneys to vigorously prosecute police misconduct.”
Casaus faces a maximum penalty of 20 years in prison when he is sentenced. His sentencing hearing has yet to be scheduled. Gonzales was sentenced in Jan. 2013 to 33 months in prison. Pendley’s sentencing hearing also has not been scheduled.
“When those who are sworn to uphold the law and protect others instead abuse their power and position, they undermine the public’s confidence in the justice system and our government institutions,” said Kenneth J. Gonzales, U.S. Attorney for the District of New Mexico. “The U.S. Attorney’s Office and the Department of Justice are committed to promoting trust in our system of justice by vigorously prosecuting those who obstruct justice.”
“Corrections officers have a special duty to safeguard the civil rights of the inmates they oversee. That is why the Albuquerque FBI aggressively investigated this case that also resulted in the guilty pleas of two other former MDC officers,” said Carol K.O. Lee, Special Agent in Charge of the Albuquerque Division of the FBI. “I would like to congratulate the FBI Special Agents for their hard work, and the U.S. Attorney's Office and the Justice Department’s Civil Rights Division for three successful and important civil rights prosecutions. I also want to thank the Bernalillo County Sheriff's Office and the Metropolitan Detention Center's executive management and internal affairs staff.”
This case was investigated by the Albuquerque Division of the FBI and is being prosecuted by Assistant U.S. Attorney Mark T. Baker for the District of New Mexico and Trial Attorney Fara Gold of the Civil Rights Division of the U.S. Department of Justice.
Former Mendenhall Police Chief IndictedRead the Press Release
Jackson, Miss - Donald “Bruce” Barlow, 50, who served as the Mendenhall, Mississippi Chief of Police until October 2010, was arrested today by Special Agents of the Federal Bureau of Investigation pursuant to a federal indictment charging him with conspiracy, extortion, soliciting bribes, and witness tampering, U.S. Attorney Gregory K. Davis and FBI Special Agent in Charge Daniel McMullen announced.
If convicted of the charges, Barlow faces a maximum penalty of 105 years in prison and a $2,000,000.00 fine. He will appear for an arraignment before U.S. Magistrate Judge F. Keith Ball on Friday, March 8, 2013 at 11:00 a.m.
This case was investigated by the Federal Bureau of Investigation and the Mississippi State Auditor’s Office. It will be prosecuted by Assistant U.S. Attorney Mike Hurst.
The public is reminded that an indictment is an allegation that a defendant has committed a crime. All defendants are presumed innocent until and unless proven guilty.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
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Former Markham Deputy Police Chief Arrested on Federal Civil Rights Charge Alleging Aggravated Sexual AbuseRead the Press Release
CHICAGO — The former deputy police chief in south suburban Markham was arrested today after being charged in a federal indictment with violating the civil rights of a victim through acts that included aggravated sexual abuse. The defendant, TONY D. DEBOIS, was arrested at his home this morning without incident by special agents of the FBI. DeBois was the deputy chief of the Markham Police Department when the alleged crime occurred on Sept. 23, 2010.
DeBois, 41, of Matteson, was scheduled to appear at 2:15 p.m. today before U.S. District Magistrate Judge Sidney I. Schenkier in Federal Court. He was charged in a single-count indictment that was returned by a federal grand jury yesterday and unsealed today following his arrest.
The indictment alleges that on Sept. 23, 2010, while acting in his official capacity as Markham deputy police chief, DeBois violated the victim’s right to bodily integrity by acts that included aggravated sexual abuse.
DeBois served as deputy chief between 2008 and approximately 2011, and he was also the Markham Police Department’s head of internal affairs between 2007 and approximately 2011, when he became Markham’s inspector general until sometime in 2012. DeBois began his law enforcement career with the former Chicago Housing Authority Police Department in the 1990s, and he was a police officer in south suburban Harvey from 1999 to 2007, when he joined the Markham Police Department.
The arrest and indictment were announced by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, and Cory B. Nelson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation. They thanked Anita Alvarez, Cook County State’s Attorney, for her office’s extensive cooperation in the investigation, as well as the Illinois State Police.
The government is being represented by Assistant U.S. Attorney April Perry.
The felony civil rights violation carries a maximum penalty of life in prison and a $250,000 fine. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory United States Sentencing Guidelines.
The public is reminded that the charge is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Indictment
Former Law Enforcement Officers Plead Guilty to Theft of Government FundsRead the Press Release
Jackson, Miss. -- Watson Jackson, a former Deputy with the Madison County Sheriff’s Office, Zach Robinson, a former Deputy with the Hinds County Sheriff’s Office, and Kent Daniels, a former Jackson Police Officer and Investigator for the Hinds County District Attorney’s Office, pled guilty in U.S. District Court today to theft of government funds and property.
On September 30, 2011, defendants Robinson and Daniels, along with an FBI informant, drove to a motel to rob a room they thought was being used by a drug dealer. They discussed detailed plans of the robbery and how they would divide the money among themselves. However, the FBI had previously rented the motel room and placed $23,000.00 in cash and seven iPads in the room. Jackson drove in a separate vehicle to the motel and acted as a lookout.
Upon arrival at the motel, the FBI informant and Robinson entered the motel room and took the $23,000.00 and seven iPads. After taking the cash and the iPads, they met up with defendant Daniels in order to count the money. At the time, they did not believe they had taken all of the money, so Jackson and the FBI informant went back to the motel room and looked for additional money. After the robbery, defendants Robinson, Daniels, Jackson and the FBI informant divided the money and iPads between them.
This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorneys Jerry Rushing and Mike Hurst.
The defendants will be sentenced by U.S. District Judge Tom S. Lee on May 23, 2013, at 9:00 a.m. They each face a maximum sentence of 10 years in prison and a $250,000 fine.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Our nation-wide commitment to reducing gun crime in America.
Former Gamestop VP, Who Defrauded Company of Nearly $2 Million, Is Sentenced to 51 Months in Federal Prison and Ordered to Pay RestitutionRead the Press Release
DALLAS, Texas — Frank Christopher Olivera, 46, of Grapevine, Texas, the former Vice President of Corporate Communications and Public Affairs at Gamestop Texas LLP, was sentenced this afternoon by U.S. District Judge Jane J. Boyle to 51 months in federal prison, following his guilty plea in November 2012 to one count of mail fraud. Olivera stole more than $1.7 million, most of which he has repaid to the victim, Gamestop Texas LLP. Judge Boyle ordered that Olivera pay an additional $57,376, which constitutes the amount unpaid on the loss and $77,275 additional restitution to Gamestop. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, beginning in July 2009 and continuing to April 2011, Olivera defrauded Gamestop by submitting false and fraudulent invoices for vendor services from a fictitious company, “Cloud Communications LLC,” which he owned and controlled. Olivera directed Gamestop to send the payments from Gamestop’s offices in Grapevine to Cloud Communications LLC in Las Vegas and Lake Tahoe, Nevada and in Canada. In addition to creating a fictitious company, Olivera also created a fictitious person, “Jennifer Miller,” to serve as the point of contact at Cloud Communications. Upon receipt of payments from Gamestop, Olivera would deposit the checks into a bank account held by Cloud Communications and then would transfer the fraudulently obtained funds into his personal bank account.
The overall scheme to defraud involved $1,965,900 in fraudulent invoices.
The case was investigated by the FBI and prosecuted by Assistant U.S. Attorney Errin Martin.
Former Employee of Timeshare Consulting Firm Pleads Guilty to Fraud ConspiracyRead the Press Release
CAMDEN, N.J. – A former employee of The Vacation Ownership Group, LLC admitted today to conspiring to defraud owners of timeshare properties, U.S. Attorney Paul J. Fishman announced.
Aimee Allen, 27, of Myrtle Beach, S.C., pleaded guilty to a one-count criminal Information charging her with conspiracy to commit mail and wire fraud. Allen entered her guilty plea before U.S. District Court Judge Noel L. Hillman in Camden federal court.
According to documents filed in this case and statements made in court:
The Vacation Ownership Group, a/k/a VO Group LLC (the “VO Group”), purported to offer owners of timeshares consulting services, including timeshare cancellation services. In June 2010, Allen started working at the VO Group and was trained by VO Group managers to call customers using prepared scripts. Allen would call customers and give them the false impression that she was working for a bank or lending institution. Allen then would falsely represent that the VO Group could pay off the customers’ timeshares or have their timeshares cancelled. Allen also served as a “reference” for other VO Group employees by posing as a satisfied customer to persuade a new customer to send the VO Group money. After hearing Allen’s false representations, some customers sent checks to the VO Group. Allen admitted to causing over $200,000 in losses.
On Jan. 23, 2013, 10 other individuals who worked at the VO Group were charged in a Superseding Indictment with conspiracy to commit mail and wire fraud and other charges. Those charges are pending before Judge Hillman.
The mail and wire fraud conspiracy charge to which Allen pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is currently scheduled for June 14, 2013.
U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Acting Special Agent in Charge David Velazquez in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Robert Panella, New York Region, for their roles in the investigation.
The government is represented by Assistant U.S. Attorneys Alyson M. Oswald and R. David Walk, Jr. of the U.S. Attorney’s Office Criminal Division in Camden.
13-107
Defense counsel: Edward F. Borden, Jr., Esq., Cherry Hill, N.J.
Allen, Aimee Information
Former Chicago Bears Player and Cook County Sheriff’s Deputy Charged Separately with Failing to File Federal Tax ReturnsRead the Press Release
CHICAGO — A former Chicago Bears football player and a Cook County sheriff’s deputy who worked part-time as a collegiate and professional sports referee were charged separately today with misdemeanor federal offenses for allegedly failing to file federal income tax returns over a period of four years.
One defendant, CHRISTOPHER ZORICH, 43, of Chicago, who played for the Chicago Bears from 1991 through 1996 and for the Washington Redskins in 1997, was charged with four counts of failing to file federal income tax returns for calendar years 2006 through 2009 when he allegedly had gross income totaling more than $1 million. Through his attorney, Zorich authorized the government to disclose that he is cooperating with the Internal Revenue Service and will plead guilty to the misdemeanor charges.
The other defendant, STEPHEN R. PAMON, 61, of Elk Grove Village, a Cook County sheriff’s deputy who officiated college basketball, football, and baseball games, as well as Arena Football League games, was also charged with four counts of failing to file federal income tax returns for calendar years 2006 through 2009 when he allegedly had gross income totaling nearly $325,000.
Charging documents were filed today against both defendants in U.S. District Court. They will be arraigned separately on dates still to be determined.
According to the charges against Zorich, he graduated from the University of Notre Dame in 1991 and from its law school in 2002. He was employed by a Chicago law firm from 2002 through 2006, and by the University of Notre Dame from 2008 through 2010. In 1993, Zorich founded and served as the executive director of the not-for-profit Chris Zorich Foundation, which was established to help disadvantaged families in the Chicago area and provide scholarships for disadvantaged students to attend Notre Dame.
The Foundation paid Zorich rental income for the use of property of approximately $3,000 per month. In 2004, the Foundation’s registration with the Illinois Attorney General’s Office was cancelled after the Foundation failed to submit an annual report for calendar year 2002, making the Foundation ineligible to solicit, receive, or hold funds in Illinois. However, the Foundation continued to receive contributions and make rental payments to Zorich during the years 2006 through 2009, despite failing to file tax forms reporting the payments to Zorich during those four years.
The charges allege that during those years, Zorich received deferred compensation from the Chicago Bears, as well as rental income from the Foundation, and income from the law firm, Notre Dame, and personal appearance fees. He allegedly received gross income of at least $331,625 in 2006; $70,996 in 2007; $372,448 in 2008; and $242,298 in 2009, but failed to file federal income tax returns for each of those years.
According to the charges against Pamon, in addition to working for the Cook County Sheriff’s Department, he worked for a private security company from 2005 through 2008, and 3 from 1973 through at least 2010, he worked as a referee officiating collegiate games, including for the Big Ten Conference, and since 2000 as a referee in Arena Football League games.
The charges allege that Pamon received gross income of at least $102,657 in 2006; $87,474 in 2007; $59,082 in 2008; and $75,525 in 2009, but failed to file federal income tax returns for each of those years.
The charges were announced by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, and James C. Lee, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.
Failure to file a federal income tax return is a federal misdemeanor and carries a maximum penalty of one year in prison and a $100,000 fine on each count. In addition, a defendant convicted of tax offenses faces mandatory costs of prosecution and remains civilly liable to the government for any and all back taxes, as well as a potential civil fraud penalty of up to 75 percent of the underpayment plus interest. If convicted, the Court must determine a reasonable sentence to be imposed under federal statutes and the advisory United States Sentencing Guidelines.
The government is being represented in both cases by Assistant U.S. Attorney William Hogan.
The public is reminded that an information contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Zorich Information
Pamon InformationFive Sentenced in Dog Fighting RingRead the Press Release
NEW BERN - United States Attorney Thomas G. Walker announced that in federal court yesterday, Judge Louise W. Flanagan sentenced JAMES MATTHEW BLACKMAN, 43, to 3 years probation and 30 days intermittent confinement, RICKY DIAL, 55, to 8 months imprisonment followed by 2 years of supervised release, and JIMMY JACOBS, 40, to 29 months imprisonment followed by 3 years supervised release, all of these men are from Maxton, North Carolina. Also sentenced were FRANK JACOBS, 69, of Laurinburg, North Carolina, to 29 months imprisonment followed by 3 years supervised release and TONY HARRIS, 35, of Lamar, South Carolina to 21 months imprisonment and 3 years of supervised release.All these men were sentenced for their roles in a dog fighting ring in Robeson County, North Carolina.
United States Attorney Walker stated, “Word must go out. Dog fighting, a particularly cruel crime, will not be tolerated. This prosecution stands for our commitment to pursue and prosecute those engaged in such heinous acts.”
According to the Indictment, the members of the conspiracy used various manners and means to accomplish the conspiracy, including, but not limited to, the following: trained and bred pit bulls for participation in dog fighting ventures; traveled in interstate commerce to other locations to participate in dog fighting ventures; sponsored and fought dogs that had traveled in interstate commerce in animal fighting ventures; placed and accepted bets on individual dog fights; collected entrance fees to dog fights and secured locations of dog fighting ventures; provided property in secluded locations and constructed pits to host dog fighting ventures; and offered prize money for winning participant in dog fighting venture.
Investigation of this case was conducted by the North Carolina Alcohol Law Enforcement, Scotland County Sheriff’s Office, and the Federal Bureau of Investigation’s Raleigh – Durham Safe Streets Task Force consisting of the Raleigh Police Department, Durham Police Department, Durham County Sheriff’s Office, Cary Police Department, North Carolina State Highway Patrol, Greenville Police Department, Garner Police Department and North Carolina Probation and Parole. Assistant United States Attorney Denise Walker prosecuted the case.
Final Defendant Sentenced in Federal Gun Conspiracy CaseRead the Press Release
Gulfport, Miss – Robert Arnold Savage, 62, of Grand Bay, Alabama, was sentenced by Senior District Judge Walter J. Gex III to serve 41 months in prison for a federal firearms charge, U.S. Attorney Gregory K. Davis announced. He was also ordered to forfeit a total of 85 firearms and pay a $3,000 fine.
Savage was one of 15 defendants charged in a firearms conspiracy case involving the illegal sale of firearms. He pled guilty on December 7, 2012 to the illegal sale of firearms to a person he believed was an unlicensed out-of-state resident who was actually an undercover ATF agent.
This case was the result of an undercover investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives into the Simon City Royals criminal street gang and persons illegally selling firearms. It was prosecuted by Assistant U.S. Attorney Annette Williams.###
If you believe you have been a victim of fraud from a person or an organization soliciting relief funds on behalf of storm victims, contact the National Center for Disaster Fraud toll free at:
(866) 720-5721
You can also fax information to:
(225) 334-4707
or e-mail it to:
Making sure that victims of federal crimes are treated with compassion, fairness and respect.
Training and seminars for Federal, State, and Local Law Enforcement Agencies.
Help us combat the proliferation of sexual exploitation crimes against children.
Our nation-wide commitment to reducing gun crime in America.
Fifteen Charged in Telemarketing Scheme to Defraud Time-Share Unit OwnersRead the Press Release
Forty-one defendants charged to date on timeshare resale telemarketing fraud
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announced today a two-count Indictment charging conspiracy to commit mail fraud and wire fraud and conspiracy to commit money laundering. The indictment charges the following 15 defendants: Pasquale Pappalardo, 60, of Coral Springs, FL, Pasqualino Agovino, 49, of Coral Springs, FL, Patride Ditroia, 43, of Coral Springs, FL, Louis Duany, 64, Wilton Manors, FL, Michael Bleich, formerly of Boca Raton, FL, 36, Audwin Lovinsky, of Tamarac, FL, 35, Ibrahim Al-Dabbas, 47, Deerfield Beach, FL, Michael Vincent Scheel, 50, of Boca Raton, FL, Diana Harrington, 65, of Boca Raton, FL, Ashley Lowton, 24, of Clermont, FL, Charles Lee, 24, of Coral Springs, FL, Kenneth Rockmore, 27, of Lauderhill, FL, Ricardo Davis, 25, of Tamarac, FL, Milton Oliver, 37, of Boynton Beach, FL, and Clinton Ross, 57, of Redondo Beach, CA. All defendants are charged in Count 1 of the indictment with conspiracy to commit mail fraud and wire fraud, in violation of Title 18, United States Code, Section 1349. Count 2 charges defendants Pappalardo, Agovino, Ditroia, and Duany with conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956. Defendants Pappalardo, Ditroia, Lovinsky, Oliver, Agovino, Duany, Lowton, Davis and Lee all appeared in court today before U.S. Magistrate Judge Lurana S. Snow. Bond hearings are scheduled for tomorrow. Arrests are expected to continue during the week.
So far, 41 defendants have been charged to date for their involvement with a time-share resale telemarketing room called Timeshare Mega Media and Marketing Group, Inc. (TMMMG). The other cases previously filed include Case Nos. 11-60190-CR-Cohn, 11-60247-Cr-Marra, 11-60268-Cr-Hurley, 12-60019-Cr-Scola, 12-60149- Cr- Scola, and 12-mj-6114-RSR.
According to the indictment, in June 2009, Pappalardo incorporated TMMMG, using defendant Duany and Duany’s mother as nominee owners. Pappalardo was a co-owner of TMMMG, and Ditroia, Agovino, and Duany helped run TMMMG for him. According to the allegations in the indictment, the defendants conspired to unlawfully enrich themselves by making false representations over the telephone to individuals who were trying to sell their time-share units. Among the false statements, the defendants would tell customers, most of whom lived outside of the State of Florida, that the defendants had successfully sold their time-share unit and asked the customer to pay a fee to finalize the sale, which fee would purportedly be refunded at closing. This fee ranged from at least $1,996 to as much as $10,000.
According to the indictment, the defendants knew that TMMMG never had any buyers for any of the sellers of their time-share units. In this way, during the ten months that TMMMG was in business, it fraudulently induced customers to send approximately $5,000,000 to TMMMG, of which Pappalardo received at least $300,000 in checks and hundreds of thousands of dollars of cash from victims.
If convicted, defendants Pappalardo, Agovino, Ditroia, and Duany each face a possible statutory maximum sentence of up to 40 years in prison. Defendants Bleich, Lovinsky, Al-Dabbas, Scheel, Harrington, Lowton, Lee, Rockmore, Davis, Oliver, and Ross each face a possible statutory maximum sentence of up to twenty years in prison.
Mr. Ferrer commended the investigative efforts of the FBI. Mr. Ferrer also recognized the assistance provided by the Fort Lauderdale Police Department and the Federal Trade Commission during this investigation. The case is being prosecuted by Assistant U.S. Attorney Jeffrey N. Kaplan.
Attachments:
Indictment (PDF)A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Federal Authorities Arrest Eagle Pass Contractor in Connection with Maverick County Bribery, Kickback and Bid-rigging SchemeRead the Press Release
In Eagle Pass, Texas, Federal Bureau of Investigation agents arrested Jose Telles, Jr, operator of 4x4 Construction, in connection with an alleged bribery, kickback and bid-rigging scheme announced United States Attorney Robert Pitman and FBI Special Agent in Charge Armando Fernandez.
A federal grand jury indictment, returned yesterday and unsealed today, charges the 43-year-old Eagle Pass resident with one count of paying a bribe to an agent of an organization receiving federal funds. The indictment alleges that in November 2009, Telles submitted a $30,200 bid to Maverick County to construct inlets and junction boxes in Precinct 1 of Maverick County. Telles was awarded the contract by Maverick County after agreeing to pay half of his profits—$5,000—to a Maverick County Commissioner for being awarded the contract. 4x4 Construction received a $15,100 check in November 2009 and a second $15,100 check in June 2010; in return Telles paid the Maverick County Commissioner.
Upon conviction, Telles faces up to ten years in federal prison.
This ongoing investigation is being conducted by the Federal Bureau of Investigation and the Texas Department of Public Safety. Individuals who have first-hand information about corruption, fraud, or bribery related to Maverick County are urged to contact the FBI at (210) 225-6741. Assistant United States Attorney Michael Galdo is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.Federal Agents Thwart Attempted Bank Account TakeoverRead the Press Release
ATLANTA – Brandon Lamar Young, 25, of Lawrenceville, Ga. was sentenced today by United States District Judge Thomas W. Thrash, Jr. for conspiracy to defraud Bank of America as part of a plot to take over a Georgia resident’s bank account.
“Prosecuting bank fraud and identity theft continues to be one of the major priorities of the Department of Justice,” said United States Attorney Sally Quillian Yates. “These defendants are being held accountable for their fraudulent conduct because of an honest citizen who refused to go along with the fraud scheme and the hard work of law enforcement agents who moved quickly and successfully stopped the crime before a Georgia resident was further victimized.”
“Identity theft is a serious issue and can, as in this case, involve stealing and misusing confidential personal information,” said Steve Linick, Inspector General, Federal Housing Finance Agency. “My office is committed to investigating and prosecuting such cases and we are proud to have worked with our law enforcement partners on this case.”
According to United States Attorney Yates and the information presented in court: On several occasions between June 2011 and May 2012, Brandon Young bought confidential financial information relating to 12 financial accounts from Alex Dantzler for a total of $1,800. Dantzler worked for the Federal National Mortgage Association, commonly known as “Fannie Mae,” in Dallas, TX, and had access to electronic loan files and other confidential financial information pertaining to Fannie Mae’s customers. One of the account profiles Dantzler sold to Young was of a Georgia resident, and included the Georgia resident’s Social Security number, date of birth, Georgia driver’s license number, and Bank of America account number.
Young took the Georgia resident’s financial information and asked an acquaintance, Oluwashina Daniel Akinfenwa, of Marietta, Ga., to help him find a Bank of America employee who would be willing to help him take over the individual’s account. Akinfenwa recruited Bank of America employee Letitia Perry, of Atlanta, Ga., who had access to the bank’s computer system. Akinfenwa asked Perry to help take over the individual’s account. Young and Akinfenwa agreed to give Perry one-third of whatever money they could get out of the individual’s account.
Perry then used Bank of America’s computer system to access confidential information pertaining to the Georgia resident’s account on at least three separate occasions. On August 10, 2012, she deliberately deleted the account holder’s true telephone number from the computer system and replaced it with Young’s telephone number. Perry then gave the telephone password and other confidential information pertaining to the individual’s account to Young and Akinfenwa.
Young contacted another friend on August 14, 2012, and asked him if he knew a white male who might be willing to impersonate the individual so they could illegally withdraw funds from the account. Young’s friend said that he would find someone who would do it. Instead, Young’s friend contacted the FBI. The FBI quickly arranged for one of its white male undercover employees to pose as a person who would be willing to impersonate the individual.
On August 14, 2012, the FBI undercover employee telephoned Young and introduced himself. Young told the FBI undercover employee that he had identified an account that he wanted to take over. He also stated that a female bank employee had deleted the real account holder’s telephone number from official bank records and had replaced it with his telephone number. Young further stated that he was in possession of the real account holder's account profile.
Young instructed the FBI undercover employee to have his photograph taken and to send it to him as soon as possible. He wanted the photo so he could obtain a fake driver’s license in the real account holder’s name. Young gave the FBI undercover employee specific instructions on what the photograph should look like. The FBI undercover employee had his photograph taken according to Young’s directions and sent it to him.
One week later, on August 21, 2012, Young sent the FBI undercover employee a text message containing the individual’s account profile. He also sent the FBI undercover employee a text message containing a photograph of a fake Georgia driver's license bearing the individual’s name, address, and the picture.
Young, Akinfenwa, and Perry were arrested before they could remove any money from the Georgia resident’s account. Young’s arrest also prevented him from victimizing the persons associated with the other 11 stolen accounts.
Akinefenwa, Perry, and Dantzler pleaded guilty to this offense. On February 5, 2013, Perry was sentenced to five months in federal prison, to be followed by five months of home confinement, and one year of supervised release. On February 5, 2013, Akinfenwa was sentenced to 15 months in federal prison to be followed by one year of supervised release.
Young was sentenced to serve 2 years, 9 months in federal prison to be followed by 3 years of supervised release. Young was convicted on December 13, 2012, upon his plea of guilty.
Dantzler is scheduled to be sentenced on May 8, 2013, at 10:00 a.m. before United States District Judge Thomas W. Thrash, Jr. He could receive a maximum sentence of five years in prison and a fine of up to $250,000.
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.
The Young, Akinfenwa, and Perry cases were investigated by special agents of the Federal Bureau of Investigation and prosecuted by Assistant United States Attorney Russell Phillips.
The Dantzler case is being investigated by special agents of the Federal Bureau of Investigation and the Federal Housing Finance Agency, Office of Inspector General, and is also being prosecuted by Assistant United States Attorney Russell Phillips.
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.
Fairfield Man Pleads Guilty to Being A Felon in Possession of A FirearmRead the Press Release
Department of Justice
Office of Public AffairsTraffic stop leads to federal conviction
TYLER, Texas – A 34 year old Fairfield man has pleaded guilty to being a felon in possession of a firearm announced U.S. Attorney John M. Bales today.
Victor Vasquez pleaded guilty today in U.S. Magistrate Judith Guthrie’s court to charges of being a felon in possession of a firearm. A federal grand jury indicted Vasquez for the offense on October 3, 2012. Vasquez admitted that on April 4, 2012 he was stopped by a police officer in Rusk, Texas for speeding. During the course of the stop, the officer determined that Vasquez had been drinking alcoholic beverages and Vasquez was arrested for DWI. Following the arrest, the officer inventoried Vasquez’s vehicle and found a 7.62x39 mm, semi-automatic rifle and ammunition for the rifle. The next day, a Rusk detective determined that Vasquez had a prior felony conviction in Kansas for Attempted Aggravated Burglary. A search warrant for Vasquez’s vehicle led to the discovery of a short-barrel, 12 gauge shotgun and a dozen 12 gauge shotgun shells under the back seat. Vasquez must forfeit the seized weapons and ammunition.
Vasquez is facing up to ten years in prison and a $250,000.00 fine. A sentencing date has not been scheduled.This case was investigated by the Rusk Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Tyler Office and prosecuted by Assistant U.S. Attorney Jim Noble.
Erwin Man Sentenced for Possession of A Firearm by A Convicted FelonRead the Press Release
RALEIGH - United States Attorney Thomas G. Walker announced that in federal court yesterday LESLIE AARON MCKEITHAN, 29, of Erwin, North Carolina was sentenced by Chief United States District Judge James C. Dever, III to 120 months imprisonment, followed by three years of supervised release.
On October 29, 2012, MCKEITHAN pled guilty to Possession of a Firearm by a Felon in violation of Title 18, United States Code, Section 922(g) and Title 18, United States Code, Section 924(a)(2).
According to the investigation, on November 26, 2011, Dunn Police Department Officers were dispatched to the Wal-Mart parking lot in reference to a domestic assault. Upon arrival witnesses informed officers they observed MCKEITHAN and a female arguing. During the course of the argument, MCKEITHAN struck the female several times and took her purse. When a witness attempted to help the female, MCKEITHAN pulled a firearm from his waist band and threatened the witness. MCKEITHAN then walked away and put the firearm and the purse in the victim’s car. The female gave police consent to search her car and officers seized a .25 caliber semi-automatic firearm. MCKEITHAN was placed under arrest and acknowledged the firearm belonged to him. MCKEITHAN was previously convicted of a violent felony in State court.
This case was part of the Project Safe Neighborhoods (PSN) initiative which encourages federal, state, and local agencies to cooperate in a unified “team effort” against gun crime, targeting repeat offenders who continually plague their communities.
Investigation of this case was conducted by the Dunn Police Department, Harnett County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms & Explosives. Assistant United States Attorney Jennifer E. Wells prosecuted the case.
Durham Man Sentenced for Bank RobberyRead the Press Release
RALEIGH - United States Attorney Thomas G. Walker announced that in federal court today RAEFORD EDWARD NUNN, 44, of Durham, North Carolina was sentenced by United States District Judge Terrence W. Boyle to 57 months imprisonment, followed by three years of supervised release. The 57 months sentence was at the top of the sentencing guidelines range.
On October 22, 2012, NUNN pled guilty to bank robbery by force or violence in violation of Title 18, United States Code, Section 2113(a).
According to the investigation, on October 20, 2010, NUNN robbed the Capital Bank located in Wake Forest, North Carolina of approximately $1,260.
This case was part of the Project Safe Neighborhoods (PSN) initiative which encourages federal, state, and local agencies to cooperate in a unified “team effort” against gun crime, targeting repeat offenders who continually plague their communities.
Investigation of this case was conducted by the Federal Bureau of Investigation and the Wake Forest Police Department. Assistant United States Attorney S. Katherine Burnette prosecuted the case.
District Man Found Guilty of Armed Robbery and Other Charges in 2012 Attack in Northwest Washington-Defendant Robbed Victim After Asking Her for Directions-Read the Press Release
WASHINGTON – Anthony Butler, 51, of Washington, D.C., was found guilty by a jury today of charges stemming from the armed robbery of a woman last fall in Northwest Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Butler was found guilty in the Superior Court of the District of Columbia of one count each of armed robbery, carrying a dangerous weapon, and possession of an open container of alcohol, as well as two counts of felony threats. He is to be sentenced on May 17, 2013 by the Honorable A. Franklin Burgess, Jr. Butler, who has previous convictions for robbery, carjacking and other offenses, faces enhanced penalties that could lead to a life prison sentence.
According to the government’s evidence, the attack took place about 8 p.m. on Oct. 27, 2012, near the National Zoo. The victim was walking alone near Adams Mills Road and Walbridge Place NW, headed to a friend’s house for a dinner party, when Butler saw her. He got out of a large red pick-up truck that was blocking her path and pretended to ask for directions.
Butler quickly grabbed the woman’s arm, thrust a knife up to her stomach, and demanded her phone and purse. After he got those items, he demanded her necklace. When she couldn’t get her necklace off fast enough, Butler yelled at her to take it off or he would kill her. After robbing her, he told her to run in the opposite direction and again threatened her if she didn’t comply.
Butler then took off in the pick-up truck. The victim flagged down a motorist who called 911. About 10 minutes later, officers with the Metropolitan Police Department’s Robbery Intervention Program spotted a truck matching the description of the one Butler was using near a gas station at Georgia and Missouri Avenues NW. Officers found the victim’s belongings spread around the truck; Butler had a knife. The victim identified Butler and he was arrested.
In announcing the verdict, U.S. Attorney Machen commended the work of those who investigated the case from the MPD. He also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Debra McPherson, Litigation Technology Specialist Paul Howell, and Victim/Witness Advocate Jennifer Clark. Finally, he praised the work of Assistant U.S. Attorney Natalia Medina, who investigated and prosecuted the case.
13-086Department of Justice Awards $1 Million to the National Crime Prevention Council to Support Gun Safety CampaignRead the Press Release
The Bureau of Justice Assistance (BJA) awarded $1 million to the National Crime Prevention Council (NCPC) to support the development of a National Public Education Campaign on the subject of responsible gun ownership and safe gun storage. With the award, NCPC will create, produce, and distribute television, radio, and outdoor Public Service Announcements (PSAs) that encourage gun owners to safely store their firearms so that they do not fall into the wrong hands. The campaign will also emphasize the importance of immediately reporting lost or stolen guns to local law enforcement to ensure public safety.
“As part of President Obama's comprehensive plan to reduce gun violence, the Administration is committed to working with firearm owners and enthusiasts to prevent tragic accidents and keep guns from falling into the wrong hands,” said Attorney General Eric Holder. “We are determined to implement the kinds of common-sense solutions that our citizens - and especially our young people - deserve.”
Ensuring the public is educated in responsible gun ownership and firearm safety is a critical aspect to reducing gun violence. Gun owners, community groups and businesses must be aware and reminded to practice safe firearm storage and to make certain that firearms in the home are not casually accessible. This public awareness campaign will endeavor to decrease the threat of gun violence by promoting principles of responsible firearm ownership nationwide and providing guidelines for the safe usage and storage of firearms.
NCPC, founded in 1982, is the nation’s nonprofit leader in crime prevention. For 30 years, they have delivered crime prevention tips and public service advertising campaigns that empower citizens individually and collectively to keep themselves, their families and their communities safe from crime.
It is planned that the PSAs created through this award will be distributed to more than 1,700 television stations, nearly 15,000 radio stations and more than 500 cable networks in 210 markets in summer 2013.
Denver Business Owner Pleads Guilty to Mail Fraud and Money Laundering as Part of A Ponzi SchemeRead the Press Release
DENVER – Michael James Turnock, age 68, of Denver, Colorado, pled guilty earlier this week before U.S. District Court Judge Christine M. Arguello to one count of mail fraud and one count of money laundering, the United States Attorney’s Office, the Federal Bureau of Investigation, IRS – Criminal Investigation and the United States Postal Inspection Service announced. Turnock, who is free on bond, is scheduled to be sentenced by Judge Arguello on May 28, 2013.
Turnock was originally charged by Information on February 14, 2013. He waived his right to be charged by an Indictment. According to the facts contained in the Information as well as the stipulated facts contained in the plea agreement, beginning no later than January 2002, and continuing through August of 2012, Turnock devised a scheme to defraud note-holders by obtaining money by means of materially false and fraudulent pretenses, representations and promises. The scheme ended on August 14, 2012, when the Securities and Exchange Commission (SEC) filed a complaint in federal court in Denver and obtained a court order freezing Bridge Premium Finance’s (BPF) assets. At that point, BPF’s note-holders included fifty-eight who had invested, and lost approximately $4,168,145.
In about 1996, Turnock became the majority owner of Berjac of Colorado, LLC, and in 2004 he became the sole owner. Two years later, Turnock changed the name of the company to Bridge Premium Finance, LLC. BPF was in the business of providing financing to clients. The clients were small businesses whose insurance carriers required them to pay the full amounts of their annual premiums in advance. BPF’s clients paid 25% of the premiums, and BPF loaned the remaining 75%. The clients usually repaid the principal amounts of the loans over eight- or nine-month periods, and made interest payments to BPF at rates between 12% and 18%. Nearly all of the money coming into BPF during this time came from investors, who received a promissory note from BPF, signed by Turnock. At times, BPF had more than one hundred note-holders.
Turnock told prospective note-holders that by charging its clients interest rates higher than the rates at which note-holders were paid, BPF generated enough funds to pay principal and interest to note-holders. However, Turnock knew BPF had not been a profitable business since at least 1998 and since 2002 its financing of small businesses had not generated sufficient revenue to make interest payments to note-holders or to repay them. For each year from 2002 through 2011 and into 2012, the amount that BPF owed to note-holders exceeded the amount of money that BPF had on hand. During that time, Turnock used most of the money invested by note-holders for purposes other than to make loans to BPF’s clients. He used note-holders’ money to pay BPF-related expenses, and he also diverted the note-holders’ money to fund his other businesses, make loans to an entity involved in real estate transactions, pay fees to himself and pay personal expenses. He used money from new investments to pay redemptions requested by note-holders who had invested earlier and to make interest payments to earlier note-holders. Turnock also prepared false and misleading reports, which misrepresented BPF’s financial position.
In early 2012, a note-holder asked to withdraw a portion of his investment. Turnock misrepresented that $150,000 was available at that time. Because BPF did not have that much money, Turnock persuaded two other individuals to invest $500,000 in BPF. On the same day, Turnock used those funds to write a $150,000 check to the note-holder requesting the withdrawal. Turnock solicited and obtained the additional investment in an effort to continue to operate his scheme.
“Ponzi schemes in this case hurt both those who were defrauded into investing, and the economy as a whole,” said U.S. Attorney John Walsh. “One of this office’s top priorities is identifying and prosecuting investment fraud scams like this one.”
“The FBI will continue to protect the financial markets by working closely with its law enforcement and regulatory partners,” said FBI Denver Special Agent in Charge James Yacone. “We trust that the outcome of this investigation will deter others who are seeking to engage in similar criminal activity and attempting to defraud innocent investors.”
“The U.S. Postal Inspection Service will continue to vigorously pursue those who utilize the U.S. Mail to perpetrate fraud schemes and steal our customers’ hard earned money,” said Adam Behnen, Inspector in Charge of the U.S. Postal Inspection Service Denver Division. “We are appreciative of our quality law enforcement relationships with the Federal Bureau of Investigation and IRS Criminal Investigation for their hard work in this case.”
“Investment fraud is like a 'house of cards’; the underlying structure can fall apart at any time leaving many investors in financial ruin,” said Stephen Boyd, Special Agent in Charge, IRS Criminal Investigation, Denver Field Office. “Defrauding investors is a serious offense and those who do will be held accountable.”
Turnock faces one count of mail fraud which carries a penalty of not more than 20 years in federal prison and a fine of up to $250,000. He also faces one count of money laundering which carries a penalty of not more than 20 years in federal prison and a fine of up to $500,000.
This case was investigated by the Federal Bureau of Investigation (FBI), the Internal Revenue Service – Criminal Investigation (IRS-CI), and the United States Postal Inspection Service.
This matter is being prosecuted by the Economic Crimes Section of the United States Attorney’s Office for the District of Colorado.
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Delaware Woman Charged in $940,000+ Tax Fraud and Identity Theft SchemeRead the Press Release
39 Count Indictment Alleges The Defendant Defrauded The Irs, The State Of New York, And Her Own Clients
WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that an Indictment has been handed down by a federal grand jury charging Dawn Chamberlain, age 36, of Claymont, Delaware, with seven counts of mail fraud (18 U.S.C. § 1341), one count of wire fraud (18 U.S.C. § 1343), eight counts of aggravated identity theft (18 U.S.C. § 1028A), and twenty counts of submitting false claims to the United States (18 U.S.C. § 287). The defendant faces up to 20 years in prison on each count of wire fraud and mail fraud, up to 5 years in prison on each count of false claims, and consecutive 2-year terms of imprisonment on each of the aggravated identity theft charges, in addition to possible fines and restitution.
According to the Indictment, from 2009 through 2012, the defendant acted as a tax preparer in Delaware. She filed false and fraudulent U.S. Individual Federal Income Tax Returns for other people. In the returns, the defendant claimed more than $730,000 in credits to which her clients were not entitled, including the American Opportunity Tax Credit and the Earned Income Tax Credit.
The Indictment further alleges that the defendant caused the refunds generated by the fraudulent federal income tax returns to be deposited into her own bank accounts, and bank accounts of her family members. She returned less than the full amount of the refunds to her clients, converting the remaining proceeds to her personal use.
The Indictment charges that the defendant used her client’s names, dates of birth, and social security numbers to file false and fraudulent New York State Resident income tax returns, without their knowledge. The defendant took advantage of New York’s tax laws, requesting refunds of more than $210,000. The Indictment alleges that the defendant knew or should have known that these clients did not live in the State of New York.
U.S. Attorney Oberly gave the following comment, “This case should send a clear signal during this tax filing season that individuals who file false claims against the United States Treasury will face significant penalties. I find fraud upon the government to be particularly troubling, and I am committed to working with the Internal Revenue Service to prosecute these cases and seek incarceration wherever possible.”
“Individuals who commit refund fraud and identity theft of this magnitude deserve to be punished to the fullest extent of the law,” stated Akeia Conner, Special Agent in Charge, IRS Criminal Investigation. “We, along with our law enforcement partners and the United States Attorney's Office, continue to do our part in protecting the integrity of the tax system and those individuals whose identities were stolen, as well as a monetary loss against the U.S. Treasury."This case is the result of an investigation conducted by the Internal Revenue Service, the United States Postal Inspection Service, and the Social Security Administration, Office of the Inspector General, with cooperation from the State of New York. The prosecution is being handled by Assistant United States Attorney Lauren Paxton, District of Delaware.
The charges in the Indictment are only allegations. The defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Cordell Veterinarian Pleads Guilty to Making False Statements to Defraud BankRead the Press Release
Oklahoma City, Oklahoma – Today, DAVID L. STURGEON, 63, from Cordell, Oklahoma, has pled guilty to making false statements to defraud the Bank of Cordell, announced Sanford C. Coats, United States Attorney for the Western District of Oklahoma.
Sturgeon is a large animal veterinarian who operates the Washita Veterinarian Clinic and lives in Cordell, Oklahoma. Sturgeon also bought and sold cattle as a manager partner of 20/20 Cattle and Consulting L.L.C and S&D Cattle L.L.C. According to an Information filed on February 21, 2013, from December 2007 through December 2008, Sturgeon secured several loans based on a revolving line of credit extended by Bank of Cordell. Under the loan agreements, loan advances were to be used by Sturgeon for the purchase of cattle which served as collateral for the loan funds advanced. Proceeds from the sale of the cattle were to be used by Sturgeon to pay off the loans owed to Bank of Cordell. During this same time, Sturgeon had two commodities trading accounts with R.J. O'Brien, a commodities firm located in Chicago, Illinois ("RJO"), that he used to make trades in agricultural commodities.
In 2008, RJO required Sturgeon to make certain deposits in his trading accounts to meet margin calls. During the plea hearing today, Surgeon admitted that on August 6, 2008, he represented to the Bank of Cordell that he needed a loan advance of $36,000 to purchase 70 head of cattle for the purpose of influencing the Bank of Cordell to advance him the loan. However, Sturgeon admitted that the loan was not used to purchase cattle and his statements were falsely made so he could fraudulently divert loan funds to make margin calls on the two RJO commodities accounts.
At sentencing, Sturgeon faces up to 30 years in prison, a fine of up to $1,000,000, and mandatory restitution. A sentencing date will be set by the Court in approximately 90 days.
This case was investigated by the Federal Bureau of Investigation and was prosecuted by Assistant U.S. Attorneys Ross N. Lillard, III, and Robert J. Troester.
Coatesville Man Faces Additional Charges Related to Alleged Ponzi SchemeRead the Press Release
PHILADELPHIA - Istvan Merchenthaler, 42, of Coatesville, PA, was charged today in a superseding indictment with seven additional counts stemming from an alleged investment fraud scheme. Merchenthaler is now charged with a total of four counts of wire fraud, two counts of aggravated identity theft, four counts of money laundering, two counts of filing false tax returns, and two counts of interstate transportation of stolen property, announced United States Attorney Zane David Memeger.
According to the superseding indictment, from at least about May 2006 to about February 2013, Merchenthaler claimed to be the founder of PhoneCard USA, a company that was purportedly a “premier distribution source” for prepaid phone cards and cell phones. In reality, Merchenthaler operated a “Ponzi” scheme, stealing over $2 million from over 200 investors and using much of these funds for his own benefit and to perpetuate his scheme.
Merchenthaler, who used a number of aliases, approached investors and persuaded them to make investments in PhoneCard USA. In his marketing materials, Merchenthaler claimed that these investments would finance the “exponential growth” of PhoneCard USA and would provide investors with “generous returns” on their investments.
In addition, Merchenthaler falsely claimed that PhoneCard USA had “lucrative contracts” with major retail chain stores “covering territories that span the east coast.” In these materials, and in his communications to investors, Merchenthaler falsely claimed PhoneCard USA had contracts with these major retail chain stores, including Walmart, 7-Eleven, and BJ’s Wholesale Club. In reality, Merchenthaler had no such contracts with these major retail chain stores. Further, Merchenthaler falsely claimed to have friendships with executives at Walmart and 7-Eleven.
According to the superseding indictment, Merchenthaler stole two cars from dealerships while on pretrial release. Merchenthaler is now in federal custody.
If convicted, the defendant faces a maximum possible sentence of 170 years of imprisonment, a $3.5 million fine, 3 years of supervised release, and an $1,400 special assessment. Merchenthaler also faces a mandatory minimum of two years imprisonment.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation Division. It is being prosecuted by Assistant United States Attorney Vineet Gauri.Click here to view the indictment
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Cleveland Man Charged with Engaging in Illicit Sexual Conduct with Children While AbroadRead the Press Release
A Cleveland man was charged with traveling to abroad and illegally engaging in illicit sexual conduct with children, said Mythili Raman, Acting Assistant Attorney General, Criminal Division, United States Department of Justice, and Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
Malek M. Al Maliki, Jr., 55, was arrested March 6.
“Protecting children from predators is a priority of my office and the Department of Justice,” Dettelbach said. “We will vigorously go after those who would abuse children, whether they lurk online, travel abroad or engage in human trafficking in our backyard.”
The indictment charges that between on or about August 15, 2010 and November 8, 2010, Al Maliki, a United States citizen, traveled in foreign commerce from the United States to Syria, and engaged and attempt to engage in illicit sexual conduct with John Doe #1, a person under 18 years of age.
The indictment also charges that between on or about August 15, 2010 and November 8, 2010, Al Maliki, traveled in foreign commerce from the United States to Syria, and attempted to engage in illicit sexual conduct with John Doe #2, a person under 18 years of age.
If convicted, the defendant’s sentence in this case will be determined by the court after consideration of the Federal Sentencing Guidelines which depend upon a number of factors unique to each case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the unique characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant United States Attorney Michael A. Sullivan and Trial Attorney Bonnie Kane of the Criminal Division’s Child Exploitation and Obscenity Section. The case was investigated by the Department of Homeland Security, Homeland Security Investigations.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Chicopee Man Receives 15 Years for Child ExploitationRead the Press Release
BOSTON - A Chicopee man was sentenced today for attempting to produce sexually explicit images of children.
Joseph Hiersche, 40, was sentenced by U.S. District Judge Denise J. Casper to 15 years in prison to be followed by 10 years of supervised release. In November 2012, Hiersche pleaded guilty to seven counts of sexual exploitation of a child, receipt of child pornography and possession of child pornography.Between March 2010 and March 2012, Hiersche downloaded numerous images and videos of child pornography from the Internet. Using hidden cameras, Hiersche also took videos of nude children with the intent to produce sexually explicit images of the children. Hiersche made these videos in order to send them to a person with whom he had established an online relationship.
“Our duty, as members of law enforcement, is to protect members of society, especially the most vulnerable members of our society, children,” said United States Attorney Carmen M. Ortiz. “Victims of sexual exploitation are robbed of their innocence and of their childhood. We will continue to work relentlessly to ensure that individuals who target children for their own personal satisfaction are investigated and prosecuted.”
United States Attorney Carmen M. Ortiz; Mark G. Mastroianni, Hampden County District Attorney; Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police; Commissioner William Fitchet of the Springfield Police Department; and Chief John R. Ferraro, Jr. of the Chicopee Police Department made the announcement today. The case was prosecuted by Assistant U.S. Attorney Alex J. Grant of Ortiz’s Springfield Branch Unit.CIA Contractors Settle False Claims Act and<br /> Kickback Allegations for $3 MillionRead the Press Release
The Justice Department announced today that American Systems Corporation, Anixter International Inc., and Corning Cable Systems LLC have agreed to pay the U nited States $3 million to settle allegations that they violated the False Claims Act and the Anti-Kickback Act in bidding on a contract with the CIA.
The settlement announced today resolves claims against these contractors related to a CIA contract awarded to American Systems in early 2009 to provide supplies and services. American Systems teamed with Anixter to bid on the contract with Corning as a supplier. The United States alleged t hat American Systems, Anixter and Corning provided gratuities, including meals, entertainment, gifts and tickets to sporting and other events, to CIA employees and outside consultants in order to influence contract specifications that would favor the three companies in the award of the contract. The settlement also resolves allegations that the three companies improperly received source selection information from a CIA employee to whom they had provided gratuities, and that they had concealed the gratuities prior to award.
“This settlement shows that the United States will protect the integrity of the federal procurement process from the wrongful activities of unscrupulous contractors,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Department of Justice, Civil Division. “Plying government officials with meals and entertainment to gain favorable treatment in the award of federal contracts corrupts the procurement process and will not be allowed.”
“Improper gifts and gratuities paid to government officials are a corrupting influence on government contracts. Combating this type of conduct is a high priority in the Eastern District of Virginia,” said U.S. Attorney for the Eastern District of Virginia Neil MacBride.
“This case clearly reflects that the CIA will respond effectively to allegations of fraud affecting agency programs,” said CIA Inspector General David B. Buckley. “My office treats contract fraud and related employee misconduct as one of our top investigative priorities, and we work closely with agency employees and the Department of Justice to ensure that illegal acts are addressed in an effective manner.”
The allegations resolved by the settlement were initiated by a lawsuit filed in the Eastern District of Virginia under the qui tam, or whistleblower, provisions of the False Claims Act by former Anixter sales representative, William Jones. Under the False Claims Act, private citizens may sue on behalf of the United States for false claims and share in any recovery obtained by the government. Jones will receive $585,000 as his share of the government’s recovery.
This settlement was the result of a coordinated effort by the United States Attorney's Office for the Eastern District of Virginia; the Department of Justice, Civil Division, Commercial Litigation Branch; and the CIA, Office of Inspector General. The claims settled by this agreement are allegations only; there has been no determination of liability.
CIA Contractors Settle False Claims Act and Kickback Allegations for $3 MillionRead the Press Release
United States Alleges Companies Provided Government Employees with Meals and Entertainment to Steer Contract Award
ALEXANDRIA, Va. – The Justice Department announced today that American Systems Corporation, Anixter International Inc., and Corning Cable Systems LLC have agreed to pay the United States $3 million to settle allegations that they violated the False Claims Act and the Anti-Kickback Act in bidding on a contract with the CIA.
The settlement announced today resolves claims against these contractors related to a CIA contract awarded to American Systems in early 2009 to provide supplies and services. American Systems teamed with Anixter to bid on the contract with Corning as a supplier. The United States alleged that American Systems, Anixter and Corning provided gratuities, including meals, entertainment, gifts and tickets to sporting and other events, to CIA employees and outside consultants in order to influence contract specifications that would favor the three companies in the award of the contract. The settlement also resolves allegations that the three companies improperly received source selection information from a CIA employee to whom they had provided gratuities, and that they had concealed the gratuities prior to award.
“Improper gifts and gratuities paid to government officials are a corrupting influence on government contracts. Combating this type of conduct is a high priority in the Eastern District of Virginia,”said U.S. Attorney for the Eastern District of VirginiaNeil MacBride.
“This settlement shows that the United States will protect the integrity of the federal procurement process from the wrongful activities of unscrupulous contractors,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Department of Justice, Civil Division. “Plying government officials with meals and entertainment to gain favorable treatment in the award of federal contracts corrupts the procurement process and will not be allowed.”
“This case clearly reflects that the CIA will respond effectively to allegations of fraud affecting agency programs,” said CIA Inspector General David B. Buckley. “My office treats contract fraud and related employee misconduct as one of our top investigative priorities, and we work closely with agency employees and the Department of Justice to ensure that illegal acts are addressed in an effective manner.”
The allegations resolved by the settlement were initiated by a lawsuit filed in the Eastern District of Virginia under the qui tam, or whistleblower, provisions of the False Claims Act by former Anixter sales representative, William Jones. Under the False Claims Act, private citizens may sue on behalf of the United States for false claims and share in any recovery obtained by the government. Jones will receive $585,000 as his share of the government’s recovery.
This settlement was the result of a coordinated effort by Assistant U.S. Attorneys Gerard Mene, Peter Hyun and Stephen Obermeier of the United States Attorney's Office for the Eastern District of Virginia; the Department of Justice, Civil Division, Commercial Litigation Branch; and the CIA, Office of Inspector General. The claims settled by this agreement are allegations only; there has been no determination of liability.
CH2M Hill Hanford Group Inc. Admits Criminal Conduct, Parent Company Agrees to Cooperate in Ongoing Investigation and Pay $18.5 Million to Resolve Civil and Criminal AllegationsRead the Press Release
The Justice Department, in conjunction with the U.S. Attorney’s Office for the Eastern District of Washington, announced today that Colorado-based CH2M Hill Hanford Group Inc. (CHG) and its parent company, CH2M Hill Companies Ltd. (CH2M Hill) have agreed that CHG committed federal criminal violations, defrauding the public by engaging in years of widespread time card fraud. In order to resolve CHG’s civil and criminal liability, CH2M Hill has agreed to pay a total of $18.5 million, commit an additional $500,000 towards accountability systems, consent to a corporate monitor, and to continue actively cooperating with the ongoing fraud investigation .
Between 1999 and 2008, CH2M Hill had a Department of Energy contract to manage and clean 177 large underground storage tanks containing mixed radioactive and hazardous waste at the Department of Energy’s Hanford Nuclear Site in southeastern Washington (the Tank Farms Contract). The Hanford Site was used for the production of nuclear weapons during World War II and the Cold War. According to the statement of facts agreed to by the United States and CH2M Hill, CHG hourly employees involved in the cleanup routinely overstated the number of hours they worked, and CHG management condoned the practice and submitted inflated claims to the Department of Energy that included the fraudulently claimed hours.
Specifically, CH2M Hill and the United States agreed that CHG’s hourly workers “consistently refuse[d] to perform any overtime work unless that overtime was offered, or ‘called out,’ in 8 hour blocks.” As stated in the agreed statement of facts, “[t]he inability of CHG’s upper management to secure the necessary overtime volunteers for various jobs threatened CHG’s ability to complete various projects linked to the Tank Farms Contract performance incentives. This in turn threatened CHG’s ability to earn certain fees, and therefore profits under the Tank Farms Contract.” According to the agreed statement of facts, the inability to obtain performance based incentives would have directly impacted the personal corporate bonuses of certain members of CHG’s upper management. Consequently, “certain members of CHG’s upper management, certain direct supervisors of the hourly workers, and certain other supervisory personnel, accepted the practice of hourly workers only working until the particular overtime job was completed, leaving Hanford, and falsely claiming a full 8 hours even when the job took less than 8 hours,” according to the agreed statement of facts.
Unfortunately, the widespread time card fraud at CHG was not limited to overtime abuse and had occurred for many years, in some instances even pre-dating the Tank Farms Contact, as stated in the agreed statement of facts. Further the agreed statement of facts provides that, “[c]ertain members of CHG’s upper management, certain direct supervisors of hourly employees, and other certain supervisory personnel, did not discipline, formally or informally, CHG hourly workers for routinely engaging in known time card fraud. In fact, certain of CHG’s direct supervisors of hourly workers engaged in patterns designed to avoid the detection of the routine time card fraud by law enforcement and internal auditors.” In this manner, as CH2M Hill agrees, CHG “knowingly, willfully, and with intent to defraud, facilitated CHG’s hourly workers routinely getting paid for hours they did not work and combined, conspired, and agreed with CHG hourly workers to accomplish the same, all at the sole expense of the citizens of the United States.”
“Contractors owe a duty to the taxpayers to accurately bill the United States for work performed,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “This settlement demonstrates that the Department of Justice, working together with its law enforcement partners, will hold contractors accountable for false billing and restore wrongfully taken funds to the Treasury.”
“This sort of systemic fraud is an appalling abuse of the trust we place in our contractors at Hanford and it simply will not be tolerated,” said Michal C. Ormsby, U.S. Attorney for the Eastern District of Washington. “However, we are pleased that CH2M Hill has stepped up and admitted to the criminal conduct of its subsidiary and has agreed to pay back a good faith estimate of what was taken, including criminal proceeds from the conspiracy.” U.S. Attorney Ormsby went on to outline that pursuant to the global agreement, “CH2M Hill has also agreed to take substantial remedial steps going forward including having its remaining subsidiary at the Hanford Site, CH2M Hill Plateau Remediation Company, consent to a corporate monitor for 3 years, and to commit an additional $500,000 towards making sure something like this does not happen again.” U.S. Attorney Ormsby also noted that, “under this global resolution, CH2M Hill will continue its commendable cooperation and help ensure that all individuals who participated in this conspiracy and profited from it will be brought to justice as well.”
“I am pleased with today’s announcement. I would like to express my thanks to the entire team – including Inspector General Special Agents, the United States Attorney's Office, the Department of Justice Civil Frauds Division and the FBI—for their efforts on this investigation,” said Gregory H. Friedman, the Department of Energy Inspector General. “It is essential that Department of Energy contractors be held accountable for effective stewardship of U.S. taxpayer dollars.”
The global resolution consists of CH2M Hill paying $16,550,000 to resolve its civil liability under the False Claims Act. In addition, CH2M Hill entered into a Non-Prosecution Agreement with the United States Attorney’s Office for the Eastern District of Washington to resolve its criminal liability. Under the terms of that agreement, CH2M Hill will refund an additional $1.95 million in wrongfully obtained profits, dedicate $500,000 to foster increased accountability at the Hanford Site, and pay for independent monitoring to ensure that CH2M Hill takes adequate corrective actions. To date, eight individuals have pleaded guilty to engaging in the same time card fraud scheme and conspiracy that CH2M Hill has now admitted CHG itself was a conspirator in.
The civil fraud allegations under the False Claims Act resolved by today’s settlement were initially alleged in a whistleblower lawsuit filed by Carl Schroeder, a former employee of CH2M Hill and one of those who pleaded guilty to the scheme. Under the False Claims Act, private citizens can sue on behalf of the United States and share in the recovery. The act, however, bars whistleblowers from recovering if they were convicted based on their role in the scheme.
This case was handled by the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Eastern District of Washington, with investigative assistance provided by the Department of Energy Office of Inspector General and the FBI.
The False Claims Act suit was filed in the United States District Court for the Eastern District of Washington, and is captioned United States ex rel. Schroeder v. CH2M Hill, No. 09-cv-5038 (E.D. Wash.).
Barren County Felon and Nine Co-Defendants Sentenced for Operating Sophisticated Marijuana Grow OperationRead the Press Release
– Organizer sentenced to 235 months in federal prison
– Among the largest marijuana indoor grow operations discovered in Western District of Kentucky by Kentucky State Police
– Produced up to ten pounds of marijuana every two weeksBOWLING GREEN, Ky. – Ten defendants charged in one of the state’s largest indoor marijuana grow operations were sentenced this week, in United States District Court, by Chief Judge Thomas B. Russell, to multiple years in prison for their roles in a conspiracy to manufacture and distribute marijuana, announced David J. Hale, United States Attorney for the Western District of Kentucky.
Dallas Norris, age 70, of Barren County, Kentucky, considered the ring-leader of the operation, was sentenced to 235 months in federal prison followed by five years of supervised release for conspiracy to manufacture and distribute marijuana, money laundering and possession of firearms by a convicted felon. Nine of the ten co-defendants were sentenced, as well, for their role in the operation of this sophisticated indoor marijuana grow operation, considered by Kentucky State Police (KSP) to be one of the largest of its kind discovered in the Western District of Kentucky. An initial tip to KSP led troopers to Norris’s Glasgow, Kentucky home, where they discovered 1,267 marijuana plants on November 12, 2011.
“The successful prosecution of this multi-defendant drug production and distribution organization was made possible by a collaborative law enforcement approach,” stated David J. Hale, United States Attorney. “We are grateful for the good work of the State Police, the ATF and the Warren County Drug Task Force. As drug organizations become more sophisticated and often more brazen, we will rely on effective cooperation between federal and state authorities to protect the public and prosecute the offenders. Our communities are safer as a result of these efforts.”
“Kentucky State Police is committed to combating the marijuana drug trade,” says Rodney Brewer, KSP Commissioner. “These enterprises have no limits and further fuel other illicit criminal organizations and their violence.”
The investigation by KSP, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Warren County Drug Task Force revealed that the grow became operational in 2008 and had been producing seven to ten pounds of marijuana approximately every two weeks. Norris was selling the marijuana for $2,500 to $3,000 per pound and that he took elaborate measures to avoid detection of his operation including: illegally tapping the local power company main line to power the grow; and pumping and purifying cave water located on the property to water the extensive grow operation.
The ten co-defendants, charged in a May 16, 2012 federal superseding indictment, all pleaded guilty for their roles in the conspiracy. Josephine Polan of Flagler Beach, Florida to 18 months in prison followed by two years of supervised release; from Wellston, Ohio - Roger L. Goheen to 92 months followed by five years of supervised release, Shelli Goheen to 18 months followed by three years of supervised release, and Dennis Cain Goheen to 24 months in prison followed by three years of supervised release; Darryl G. Newsome, Kimberly Newsome, and Darryl Allen Newsome of Springfield, Ohio to six months in prison followed by six months of home incarceration followed by two years of supervised release; Vanessa Golden of Covington, Kentucky to three years’ probation; and Victoria Kampschaefer of Louisville to three years’ probation. Garry Kampschaefer, of Louisville, awaits sentencing.
In addition to the prison sentence, Norris will forfeit to the United States, a 2006 Ford F-250 truck, property located in Barren County, Kentucky and Jackson County, Ohio, $22,621 US currency, and miscellaneous farm equipment and collectibles. Norris admitted to structuring three transactions with financial institutions between February 28, 2008 and March 12, 2008, by purchasing three cashier’s checks each in the amount of $9,000. Norris used the cashier’s checks and an additional personal payment of $6,114 to purchase the 2006 Ford truck. At the time of his arrest, Norris, a convicted felon, based upon his previous conviction for manufacturing marijuana, was in possession of two firearms.
This case was prosecuted by Assistant United States Attorney Mac Shannon and was investigated by KSP, ATF and the Warren County Drug Task Force.
Bank Robber Pleads GuiltyRead the Press Release
Montgomery, Alabama - On March 6, 2013, Gerrard Dixon, entered a plea of guilty to armed bank robbery and conspiracy to commit an armed bank robbery.
On Friday, November 4, 2011, at approximately 11:42 a.m., Dixon and another individual entered the BancorpSouth Bank located in Fort Deposit, Alabama, and robbed it at gunpoint. The bank surveillance video shows Dixon and another individual, Lee Williams, enter the bank and while Williams holds a customer and employees at gunpoint, Dixon jumps over the counter and takes over $9000 in assorted U.S. currency from two teller drawers. Dixon and Williams then make their escape by a waiting car.
On December 7, 2011, Dixon and Williams entered into an agreement to rob the same BancorpSouth Bank and in furtherance of the conspiracy, obtained guns, an automobile, and returned to Fort Deposit to "case" the bank. Fort Deposit police officers, who had increased patrol on area banks, noticed Dixon, who was operating the vehicle, and Williams, who was the passenger, behaving suspiciously. When the officers attempted to stop them, Dixon fled, taking police on a high-speed pursuit. Dixon eventually crashed his vehicle in Montgomery, and the two fled on foot, but were quickly apprehended by the Montgomery Police Department. Two loaded firearms were recovered near the crash site.
“Those that rob banks put tellers, customers and the public at large in serious danger,” stated U.S. Attorney Beck. “These innocent victims are often traumatized by these bank robberies. My office will continue to prosecute those people who intentionally hurt the public for their own monetary gain.”
Dixon, who is currently serving a sentence of 30 years for the Attempted Murder of a convenience store employee in Montgomery, faces a possible sentence of incarceration of not more than 25 years for the bank robbery and not more than 5 years for the conspiracy, a fine of not more than $250,000, and a term of supervised release of not more than 5 years.
Williams entered an earlier plea to similar charges and is awaiting sentencing at this time.
The case is being investigated by Federal Bureau of Investigation, the Fort Deposit Police Department, the Montgomery Police Department and the Montgomery County Sheriff's Office. This case is being prosecuted by Assistant United States Attorney Susan R. Redmond.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617Avon Lake Man Charged with Making A False Statement to the FBIRead the Press Release
A criminal information was filed charging an Avon Lake man with one count of making a false statement to law enforcement, law enforcement officials said.
Kenneth J. Grabowski, 67, was a retired employee of a company identified only as Business 13. He retired in 2003.
As part of the wide-ranging investigation into public corruption in Cuyahoga County, FBI agents tried to determine employees at Business 13 engaged in fraud and commercial bribery with targets of the investigation, including Michael Forlani, the owner of Doan Pyramid Electric, according to the information.
Agents interviewed Grabowski on Nov. 10, 2011, during which time he knowingly and willfully made a material false statement to FBI agents. Grabowski said he was not aware of Forlani or any other Doan Pyramid employee giving case to any Business 13 employee, including Grabowski himself, well knowing at the time that his statement was false, according to the information.
This case is being prosecuted by Assistant United States Attorneys Antoinette T. Bacon, Ann C. Rowland and Nancy Kelley following an investigation by the Federal Bureau Investigation and Internal Revenue Service – Criminal Investigations.
An information is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Armed Drug Dealer Sentenced to Fifteen Years in PrisonRead the Press Release
OAKLAND - Quentel Reed was sentenced today to fifteen years in prison for possession of a firearm in furtherance of a drug trafficking crime, United States Attorney Melinda Haag announced.
Reed pleaded guilty on November 1, 2012, to possessing a firearm in furtherance of drug trafficking. According to the plea agreement, Reed admitted that on February 9, 2012, he knowingly possessed approximately 59 grams of cocaine base on his person, packaged for distribution as more than 75 individually wrapped rocks. Mr. Reed also admitted that, in furtherance of his drug trafficking, he was carrying a 9mm firearm fitted with a large capacity magazine and loaded with 17 rounds of ammunition.
Reed, 31, of Oakland, was indicted by a federal grand jury on March 8, 2012. He was charged with being a felon in possession of a firearm and ammunition, possession with intent to distribute cocaine base, and possession of a firearm in furtherance of drug trafficking.
According to filed court documents, Reed was arrested after leading Oakland Police Officers on a foot pursuit through the neighborhood near McClymonds High School in Oakland. As Oakland Police Officers approached Reed standing on the street, he discarded a bag containing the drugs and ran from the officers. During the chase, Reed attempted to get rid of the gun by throwing it over a fence into a vacant lot.
The sentence was handed down by United States District Court Judge Yvonne Gonzalez Rogers.
This case was part of Operation Gideon and an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Oakland Police Department. Operation Gideon, undertaken by federal law enforcement authorities in 2012 to help combat street crime in Oakland and neighboring cities, has resulted in the federal conviction of more than 60 defendants in the Northern District of California.
Alabama Defendants Sentenced for Their Role in a Million Dollar Identity Theft Tax SchemeRead the Press Release
Corey Means was sentenced yesterday to 20 months in prison and Melba Wilson to eight months home detention for their involvement in a million dollar identity theft tax scheme, the Justice Department and the Internal Revenue Service (IRS) announced.
According to court documents, between October 2009 and April 2012, Antoinette Djonret and her co-conspirators used stolen identities to file over 1,000 false tax returns that fraudulently claimed over $1.7 million in tax refunds. Djonret orchestrated this scheme. She obtained stolen identities from multiple sources, including Alabama state databases. She also established an elaborate network for laundering the refund money. Djonret recruited Corey Means, Melba Wilson and others into the conspiracy. Melba Wilson and Corey Means recruited individuals to obtain prepaid debit cards and gave the cards to Djonret. Corey Means also provided addresses to Djonret for the purpose of receiving prepaid debit cards. The fraudulent tax refunds obtained by the conspiracy were directed to these prepaid debit cards and Djonret and her co-conspirators would then use the cards to obtain the proceeds. Djonret was previously sentenced to 144 months in prison for her role in this scheme and for other criminal conduct.
Assistant Attorney General Keneally commended the efforts of Special Agents of IRS - Criminal Investigation, who investigated the case, and Tax Division Trial Attorneys Jason H. Poole and Michael Boteler, and Assistant U.S. Attorney Todd Brown, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax .
Wednesday 6 March 2013
US Attorney Wigginton Announces Six-Count Indictment Against Belleville Martial Arts Instructor for Sexual Exploitation of A MinorRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today that a United States Grand Jury has returned a six-count indictment against Belleville martial arts instructor, Christopher M. Horton, 20, of Highland, Illinois, charging him with five counts of Sexual Exploitation of a Minor and one count of Attempt Sexual Exploitation of a Minor. The alleged violations took place between on or about May 1, 2012 and February 11, 2013, in Madison and St. Clair Counties. Horton had been charged in a two-count federal Criminal Complaint for Sexual Exploitation of a Minor on February 15, 2013, as part of a joint investigation and prosecution undertaken by the United States Attorney’s Office, the St. Clair County State’s Attorney’s Office, and the Madison County State’s Attorney’s Office. The Court has ordered that Horton be held without bond pending trial.
The offenses charged in the indictment allege that, between on or about May 1, 2012 and February 11, 2013, Horton video recorded himself engaged in sexual activity with three minors and attempted to engage a fourth minor in sexually explicit conduct for the purposes of producing a recording of the conduct.
A federal trial date has not yet been set. If convicted of Sexual Exploitation of a Minor, Horton faces a term of imprisonment of not less than 15 years but not more than 30 years in prison on each count, a fine up to $250,000, and a term of supervised release of not less than 5 years, up to and including, a lifetime of supervision once he is released.
An indictment is a formal charge against a defendant that is comprised of the essential facts constituting the offense charged. Under the law, a defendant is presumed to be innocent of a charge until proven guilty beyond a reasonable doubt to the satisfaction of a jury.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in 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.”
The case was investigated by the Madison County Sheriff’s Department, the Federal Bureau of Investigation’s Metro East Cyber Crimes and Analysis Task Force, the Highland, Illinois Police Department and the Belleville, Illinois Police Department. The case is assigned to Assistant United States Attorneys Ali Summers.
Tyler Schaeffer and Two Codefendants Charged in Armed Robbery SpreeRead the Press Release
All Face Lengthy Prison Terms For Using Firearms In The Commission Of Violent Crimes
KNOXVILLE, Tenn. - A federal grand jury in Knoxville returned a 14-count indictment on Mar. 5, 2012, against Tyler Schaeffer, 21, of Seymour, Tenn., for one count of conspiracy to commit Hobbs Act robbery, seven counts of Hobbs Act robbery, four counts of brandishing a firearm during a robbery, one count of conspiracy to distribute and possess with intent to distribute methylone, and one count of possessing a firearm in furtherance of a drug trafficking crime. In that same indictment, Jerel Bray-Shawn Johnson, 20, of Knoxville, Tenn., was charged in the conspiracies to commit Hobbs Act robbery and to distribute and possess with intent to distribute methylone, as well as two counts of Hobbs Act robbery, and two counts of brandishing a firearm during a robbery. Lastly, Rodney James Ruffin, 21, of Sevierville, Tenn., was charged in the same indictment with conspiracy to commit Hobbs Act robbery, one count of Hobbs Act robbery, and one count of brandishing a firearm during a robbery.
On Mar. 6, 2013, Jerel Bray-Shawn Johnson appeared before U.S Magistrate Judge C. Clifford Shirley, Jr., and entered pleas of not guilty to all charges. Johnson was detained pending trial, which is set for May 14, 2013.
If these individuals are convicted, they face significant mandatory minimum terms of in prison for the firearm offenses. Schaeffer faces not less than 107 years in prison, Johnson not less than 32 years, and Ruffin not less than seven years. They each face additional prison time for the robberies and drug trafficking crimes, which must be served consecutively to the prison time imposed for the firearm offenses. There is no parole in the federal system.
This indictment is the result of an investigation by the FBI Safe Streets Task Force, which includes members of the Knoxville Police Department and Knox County Sheriff’s Office, Office of James B. Dunn, District Attorney General for the Fourth Judicial District, Tennessee Highway Patrol, Sevier County Sheriff’s Office, and Alcoa Police Department. Assistant U.S. Attorneys Tracy L. Stone and Kelly A. Norris will represent the United States.
Members of the public are reminded that an indictment constitutes only charges and that every person is presumed innocent until his or her guilt has been proven beyond a reasonable doubt.
Two Indicted on Federal Charges of Unlawful Sale of Eagle FeathersRead the Press Release
TOPEKA, KAN. – Ruben Dean Littlehead, 38, Lawrence, Kan., and Brian K. Stoner, 32, Ponca City, Okla., are charged with unlawfully selling feathers from eagles and hawks covered by a federal law protecting migratory birds, U.S. Attorney Barry Grissom said today. The crimes are alleged to have occurred in Douglas County, Kan.
Federal law (Title 16, United States Code, Section 703) prohibits taking, killing or possessing migratory birds. The U.S. Fish and Wildlife Service maintains a National Eagle Repository in Colorado for the purpose of providing Eagle feathers to Native Americans for use in Indian religious and cultural ceremonies. For more information, see:
http://www.fws.gov/le/national-eagle-repository.html
The indictment alleges:
On Sept. 15, 2008, Littlehead sold a bustle made with 68 feathers from a Golden eagle (Aquila chrysaetos).
On Nov. 22, 2008, Littlehead sold 11 tail feathers and a wing from a Golden eagle (Aquila chrysaetos).
On Feb. 26, 2009, Littlehead and Stoner offered for sale parts of a Bald eagle (Haliaeetus leucocephalus), a Golden Eagle (Aquila chrysaetos), and a Crested Caracara (Mexican Eagle, Caracara cheriway). They sold a tail feather fan made from feathers of a Bald eagle.
On Feb. 26, 2009, they sold a bustle made of feathers of a rough-legged hawk and ferruginous hawk (Bueto lagopus and Buteo regalis).
If convicted, they face a maximum penalty of five years in federal prison and a fine up to $250,000 on each count. The U.S. Fish and Wildlife Service investigated. Assistant U.S. Attorney Randy Hendershot is prosecuting.
OTHER INDICTMENTS
Robert Eugene Gibson, 26, who is being held in the Shawnee County Jail, is charged with one count of bank robbery. The indictment alleges that on Feb. 22, 2013, he robbed the Lyndon State Bank at 1535 S.W. Fairlawn Road in Topeka.
If convicted, he faces a maximum penalty of 20 years in federal prison and a fine up to $250,000. The FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.
John Duncan, 52, Topeka, Kan., is charged with one count of bank fraud and one count of money laundering. The crimes are alleged to have occurred in Douglas County, Kan. in April 2008. The indictment alleges that Duncan, who at the time was the Chief Financial Officer of Schmidt Builders Supply, Inc., and a member in Blue Jay Properties L.L.C., provided false information to University National Bank of Lawrence, Kan., to support a $15.2 million construction loan to Blue Jay Properties. Blue Jay properties was formed to develop the Quinton Pointe Apartments project in Junction City, Kan., and the loan was for the purpose of funding the apartment project. It is alleged that Duncan and the members in Blue Jay Properties needed to provide $1.225 million in collateral and that Duncan wrote a letter to UNB falsely representing that all the lumber for the project, representing collateral for the loan, was prepaid in full and being held by Schmidt Builders. The money laundering charge alleges Duncan made a wire transfer of the money obtained through the bank fraud.
If convicted, he faces a maximum penalty of 30 years and a fine up to $1 million on the bank fraud count; and a maximum penalty of 10 years on the wire fraud count. The Internal Revenue Service, Criminal Investigations Division; Federal Deposit Insurance Corporation, Office of Inspector General; Federal Reserve Board, Office of Inspector General; and U.S. Department of Labor, investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.
Taron Alonzo Huggins, 24, who is being held in the Shawnee County Jail, is charged with one count of unlawful possession of a firearm after a felony conviction. The crime is alleged to have occurred Jan. 25, 2013, in Shawnee County, Kan.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. The FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.
John T. Arlett, 43, Florissant, Mo., is charged with one count of possession with intent to distribute more than 100 kilograms of marijuana. The crime is alleged to have occurred Dec. 19, 2012, in Wabaunsee County, Kan.
If convicted, he faces a penalty of not less than five years and not more than 40 years in federal prison and a fine up to $5 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.
Juan D. Morales, 26, is charged with one count of unlawful possession of a firearm after a felony conviction and one count of knowingly possessing a stolen firearm. The crimes are alleged to have occurred March 7, 2010, in Ford County, Kan.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000 on each count. The Ford County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.
Carlos Gonzalez-Gonzalez, 55, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found Feb. 4, 2013, in Sedgwick County, Kan.
If convicted, he faces a maximum penalty of 20 years and a fine up to $250,000. ICE’s Enforcement and Removal Operations investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.
Alfredo Cruz-Nino, 24, a citizen of Mexico, is charged with two counts of unlawful possession of a firearm by an illegal alien, one count of possession with intent to distribute marijuana and one count of unlawfully re-entering the United States after being deported. He was found Feb. 13, 2013, in Sedgwick County, Kan.
Upon conviction, the crimes carry the following penalties:
Unlawful possession of a firearm by an illegal alien: A maximum penalty of 10 years in federal prison without parole and a fine up to $250,000 on each count.
Possession with intent to distribute marijuana: A maximum penalty of 20 years and a fine up to $250,000.
Unlawful re-entry: A maximum penalty of two years and a fine up to $250,000.ICE’s Fugitive Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
Rosendo Lopez-Rojas, 32, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found Feb. 27, 2013, in Sedgwick County, Kan.
If convicted, he faces a maximum penalty of two years in federal prison and a fine up to $250,000. ICE’s Enforcement and Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Three Sentenced for Conspiring to Distribute CocaineRead the Press Release
MINNEAPOLIS—Yesterday in federal court in St. Paul, a 26-year-old Robbinsdale man was sentenced for conspiring to distribute approximately 249 grams of cocaine. United States District Court Judge Susan Richard Nelson sentenced Brian Funtaneous Mack to 51 months in prison on one count of conspiracy to possess with intent to distribute cocaine. He was indicted on July 23, 2012, along with McCelendon Miller, age 26, and Kelly Suzette Chase, age 28, both of Burnsville.
On March 4, 2013, Judge Nelson sentenced Miller to 52 months in federal prison and Chase to a probationary sentence each on one count of conspiracy. He pleaded guilty on September 28, 2012. In his plea agreement, Miller admitted his role in the conspiracy. Chase and Mack pleaded guilty on September 26, 2012.
In their plea agreements, the three defendants admitted that from January 2012 through February 9, 2012, they conspired with each other and others to possess with intent to distribute cocaine. Miller made arrangements to obtain cocaine from a source in Chicago, and after Miller’s arrest, his girlfriend, Chase, obtained the cocaine from Mack. Miller also directed Chase to store the cocaine in their Burnsville apartment. On February 9, 2012, during the execution of a search warrant at that apartment, officers seized 249 grams of cocaine, along with a firearm, in a safe.
This case was the result of an investigation by the Twin Cities Safe Streets Violent Gang Task Force, which is led by the FBI and includes the Minneapolis Police Department. The mission of the task force is to investigate and target the most violent gangs operating in the Twin Cities or those gangs engaged in the large-scale trafficking of illegal drugs. This case was prosecuted by Assistant U.S. Attorney LeeAnn K. Bell.Three Former Delta Air Lines Employees Conspired to Import Illegal Drugs into Hartsfield-Jackson AirportRead the Press Release
Over $614,000 Worth of Methamphetamine and Heroin Seized From
Delta Air Lines Flight from Mexico CityATLANTA - Luis Marroquin, 36, of Atlanta, Ga., Carlos R. Springer, 42, of Hampton, Ga., and Kelvin Rondon, 28, of Miami, Fla., were sentenced today by United States District Judge Orinda Evans for conspiracy to possess with the intent to distribute methamphetamine and heroin.
“We serve the citizens of our district by promoting healthy and safe communities and we will prosecute anyone who uses our airports to import deadly drugs,” said United States Attorney Sally Quillian Yates. “People have a reasonable expectation when boarding an airplane that airline personnel will be professionals who value their safety,” she said, “and will not expose them to illegal activity.”
According to United States Attorney Yates, the charges and other information presented in court: On January 13, 2012, Delta Air Lines flight 364 arrived at the Atlanta Hartsfield-Jackson International Airport from Mexico City. A Delta agent discovered an unclaimed piece of luggage at a baggage carousel with a tag for flight 364. Customs and Border Protection agents inspected the luggage, and determined that it contained multiple packages of suspected illegal narcotics. Later that same day, Springer was interviewed by Homeland Security Investigations agents. Springer was the performance leader for the shift of ramp employees who off-loaded the baggage on flight 364.
During a search of Springer’s cellular telephone, agents found coded, incriminating text messages between Springer and Marroquin around the time of the arrival of the flight. Rondon was observed on the video of the arrival and unloading of flight 364, although he was off-duty and had no authorization to work the flight.
Agents also learned that Marroquin recruited Rondon. Rondon was to make sure that the bag was on the flight, and was to be paid $500 per package. The day before flight 364 arrived Rondon was shown a photo of the drug-laden bag on Marroquin’s telephone. Rondon stated when he arrived on the tarmac he helped unload the cargo and attempted to find the bag but was unsuccessful.
“The security of critical infrastructure like Hartsfield-Jackson Airport is a key national security concern,” said Brock D. Nicholson, Special Agent in Charge of ICE Homeland Security Investigations in Atlanta. “HSI special agents and our partners like U.S. Customs and Border Protection and the Delta security team are committed to identifying those who seek to exploit the system and ensuring they are held accountable for their actions.”
Following the return of the indictment on May 1, 2012, Marroquin fled the Atlanta area but was apprehended several days later in a residence in Coral Springs, Fla.
Marroquin was sentenced to 15 years, 8 months in prison to be followed by 5 years of supervised release.
Springer was sentenced to 11 years, 3 months in prison to be followed by 5 years of supervised release.
Rondon was sentenced to 5 years, 3 months in prison to be followed by 5 years of supervised release.
Marroquin, Springer, and Rondon were convicted of the above charges upon their pleas of guilty last year.
This case was investigated by Special Agents with the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and Task Force Officers, with assistance from Delta Air Lines Corporate Security,
Assistant United States Attorney Michael Herskowitz prosecuted the case.
The U.S. Attorney's Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.com.
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.
Steuben County Woman charged with Kidnaping Woman and Her 6 Month-old DaughterRead the Press Release
ROCHESTER, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that Billie Jo Ribble, 35, of Bath, N.Y., was arrested and charged by criminal complaint with kidnaping a mother and her six-month old child. The charges carry a mandatory minimum sentence of 20 years in prison and a maximum of life in prison.
Assistant U.S. Attorney Brett A. Harvey, who is handling the case, stated that according to the complaint, the defendant abducted a mother and her six month-old child in Pennsylvania on March 1, 2013. At that time, Ribble was wanted by the Steuben County Sheriff's Office on charges of burglary and grand larceny, in relation to a residential burglary that occurred in October 2012. On March 1, investigators from the Steuben County Sheriff's Office and Pennsylvania State Police located and arrested Ribble in Mansfield, Pennsylvania. After being remanded to the Tioga County Jail in Pennsylvania, Ribble, who is pregnant, was taken to the hospital in Wellsboro, Pennsylvania, for treatment in the maternity ward. While there, the defendant became violent, assaulted a Tioga County Corrections Officer who was assigned to guard her, and escaped the hospital by climbing out a window.
Later on March 1, a woman and her six month-old daughter were asleep in the basement bedroom of a residence in Wellsboro. At 11:30 p.m., the woman was awakened by Ribble, who was standing over her daughter's crib holding a large butcher's knife. The defendant picked up the child, while still holding the knife, and threatened to kill the woman, her child, and herself, if the woman did not take Ribble where she wanted to go. Thereafter, the woman got into the driver's seat of her car and Ribble got into the front passenger seat, still holding the woman's daughter and the butcher's knife. At the direction of Ribble, the woman drove from Pennsylvania to an exit off Route 15 in Lindley, New York, where the defendant was dropped off. The woman then drove to a gas station in Pennsylvania and called police. After urgent investigation by the Steuben County Sheriff's Office and the New York State Police, the defendant was located at her boyfriend's residence in Corning, New York. Ribble initially barricaded herself in the attic, but eventually surrendered to authorities without incident.
The complaint is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Christopher M. Piehota, the Steuben County Sheriff's Office, under the direction of Sheriff David Cole, the New York State Police, under the direction of Major Mark Koss, the Pennsylvania State Police, under the direction of Commanding Officer, Captain David J. Young, and the Wellsboro (Pennsylvania) Police Department, under the direction of Chief Jim Bodine.
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.
St. Michael Man Pleads Guilty to Involuntary ManslaughterRead the Press Release
FARGO - U.S. Attorney Timothy Q. Purdon announced that on March 6, 2013, Jamie Lee Belgarde of St. Michael, N.D., pleaded guilty before U.S. District Judge Ralph R. Erickson to a charge of involuntary manslaughter.
On June 23, 2012, Belgarde, 38, while intoxicated and driving at a high rate of speed, failed to negotiate a curve in the road, causing the vehicle to leave the road. The vehicle vaulted, rolled, and eventually came to rest upside down in a field.
Belgarde’s brother, Donald Belgarde, Jr., who was a passenger in the vehicle, was pronounced dead at the scene. The incident happened on the Spirit Lake Indian Reservation.
The charge of involuntary manslaughter carries a statutory maximum penalty of eight years' imprisonment.
The case was investigated by the Federal Bureau of Investigation and Bureau of Indian Affairs.
Sentencing for Belgarde has been scheduled for May 29, 2013, in U.S. District Court in Fargo, N.D., at 11:45.
Assistant U.S. Attorney Janice M. Morley is prosecuting the case
Springfield Businessman Indicted for $3.3 Million Fraud SchemesRead the Press Release
SPRINGFIELD, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced today that a Springfield, Mo., businessman has been indicted by a federal grand jury for a series of bank fraud and wire fraud schemes that totaled more than $3.3 million in losses, as well as for money laundering and bankruptcy fraud.
“Several local financial institutions suffered significant losses from a series of bank fraud schemes,” Dickinson said. “These are not victimless crimes, and we will aggressively prosecute those who seek to profit from financial crimes.”
Richard Thomas Gregg, 57, of Springfield, was charged in a 17-count indictment returned under seal by a federal grand jury on Feb. 28, 2013. That indictment was unsealed and made public today upon Gregg’s arrest and initial court appearance.
Gregg is charged with four counts of bank fraud, 10 counts of money laundering, two counts of wire fraud and one count of bankruptcy fraud.
David L. Anderson, Special Agent in Charge of the Kansas City Region of the FDIC Office of Inspector General, said, “Those individuals who engage in bank fraud and money laundering schemes undermine the integrity of the banking and financial services industry. The FDIC OIG is committed to stopping these illegal acts.”
“The federal indictment alleges that Mr. Gregg’s actions led to losses at several financial institutions,” said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation. “IRS CI is proud to provide our financial expertise as we work alongside our law enforcement partners to investigate these alleged illegal activities and hold those responsible for their actions.”
Gregg was the principal shareholder and director of Southwest Community Bank in Springfield, which failed in May 2010. He and his wife were majority shareholders in Glasgow Savings Bank in Glasgow, Mo., which failed in 2012. Prior to Glasgow Savings Bank’s failure, it was one of the oldest operating banks west of the Mississippi River. Gregg was also a real estate developer, investor and a licensed insurance agent for the Shelter Mutual Insurance Company. Gregg had ownership interest in and controlled a number of business entities.
According to the indictment, Gregg and his business entities accumulated substantial debt. On a personal financial statement the defendant provided to Great Southern Bank in November 2009 he reported more than $65 million in total liabilities. As of Feb. 28, 2013, the indictment says, approximately $14.6 million of the known debt attributable to Gregg and his business entities had been “charged off” by the creditor financial institutions, meaning they had defaulted and the financial institution had “written off” part or all of the loan because it determined the debt was not collectable.
Fremont Property
The federal indictment alleges that Gregg engaged in a scheme to defraud Southwest Community Bank in 2008. As a part of this bank fraud scheme, the indictment says, Gregg sold the bank a piece of commercial real estate at 2814 S. Fremont in Springfield for $1,551,944. Gregg allegedly knew that amount was significantly above fair market value.
Gregg, who was Southwest Community Bank’s principal shareholder and was on its Board of Directors, did not disclose to the bank that he had purchased that property for $775,000 a few months earlier, the indictment says, nor did he disclose to the bank that two appraisals had been conducted on the property in recent months. One appraisal valued the property at $762,000. The second appraisal was cancelled when Gregg disagreed with the preliminary work. After Gregg cancelled the appraisal, the indictment says, his son (who worked at Southwest Community Bank) ordered an appraisal of the Fremont property by another appraiser, who valued the property at $1,580,000. Gregg allegedly did not disclose to the bank that this appraisal was not an independent valuation of the property, but rather was something Gregg had, in essence, directed.
The indictment charges Gregg with four counts of money laundering related to this bank fraud scheme.
Stock Shares
In February 2009 Gregg borrowed $2 million from Great Southern Bank, using 160,000 shares of stock for First Bancshares, Inc. (FBSI), the holding company for First Homes Savings Bank, as collateral. Gregg physically deposited the stock certificate with Great Southern Bank.
According to the indictment, on May 6, 2009, with a $1.5 million balance remaining on the loan from Great Southern Bank, Gregg checked out the original FBSI stock certificate from Great Southern Bank, using as a pretext the stated purpose of separating the large certificate into multiple smaller certificates. He signed a trust receipt promising to return to the certificate to the bank within 30 days. Instead, the indictment says, Gregg deposited the collateralized FBSI shares into his account at Scottrade, a privately-owned retail brokerage firm located in St. Louis, Mo. On May 28, 2009, Gregg allegedly borrowed $440,000 from Scottrade, from the margin account on which the defendant used the FBSI stock as collateral. Gregg chose not to return the FBSI certificate or any proceeds he received to Great Southern Bank, according to the indictment, and instead used the funds for other purposes.
Collectible Cars
The federal indictment charges Gregg with two counts of bank fraud related to schemes to use collectible automobiles as collateral to obtain loans, then sell the automobiles without paying back the loans. In January and February 2010 Gregg allegedly executed separate but related schemes to defraud Great Southern Bank, Metropolitan National Bank and People’s Bank of the Ozarks. As a part of these schemes, the indictment says, Gregg sold seven collectible automobiles at the Barrett-Jackson Auto Auction in Scottsdale, Ariz. Five of the automobiles were encumbered at the three banks.
According to the indictment, Gregg borrowed $400,000 from Great Southern Bank in October 2007, which he secured with four collectible automobiles, including a 2006 Ford GT. Gregg consigned the 2006 Ford GT with the Barrett-Jackson Auto Auction in Scottsdale, Ariz., where on Jan. 23, 2010, the vehicle was sold at auction for approximately $150,000. Gregg allegedly chose to not return the proceeds of the sale of the Ford GT ($138,000 after deducting the auctioneer’s fee) to Great Southern Bank and instead used the funds for other purposes. When Gregg defaulted on the loan, Great Southern Bank realized a $129,644 loss.
According to the indictment, Gregg borrowed $400,000 from Metropolitan National Bank in 2005. He secured this loan with a “floor plan” financing, meaning the loan was a revolving line of credit made against specific pieces of collateral, in this case automobiles. When each vehicle on the floor plan was sold, the loan advanced against that piece of collateral was to be repaid. This loan was renewed in December 2009. In January 2010, the collateral included a 1971 Chevy Cheyenne Pickup. The portion of the loan’s balance collateralized by the 1971 Chevy Cheyenne Pickup was $17,221. Gregg also consigned the 1971 Chevy Cheyenne Pickup with the Barrett-Jackson Auto Auction, the indictment says, and it was sold for approximately $29,000. Gregg allegedly chose to not return the proceeds of the sale ($26,680 after deducting the auctioneer’s fees) to Metropolitan National Bank and instead used the funds for other purposes. When Gregg defaulted on the loan, Metropolitan National Bank realized a $17,221 loss.
The indictment charges Gregg with six counts of money laundering related to these bank fraud schemes.
Oklahoma Casinos
The federal indictment charges Gregg with two counts of wire fraud related to bounced checks at two Oklahoma casinos.
On Jan. 3,2012 Gregg allegedly presented five checks, payable to Buffalo Run Casino in Miami, Okla., each in the amount of $10,000. Gregg allegedly knew his credit union account contained insufficient funds to cover those checks.
Between Feb. 16 and March 1, 2012, Gregg allegedly presented five checks payable to Downstream Casino and Resort in Quapaw, Okla., in the total amount of $60,000. Gregg allegedly knew his bank account contained insufficient funds to cover those checks.
Bankruptcy Fraud
On Aug. 14, 2012, Gregg allegedly made false declarations by submitting false Schedules of Assets and Liabilities and a false Statement of Financial Affairs in his bankruptcy proceedings. Gregg stated that the bankruptcy debtor, 1717 Marketplace, LLC, owed him $868,000 for a “personal loan,” and owed another person $801,000 for a “personal loan.” In fact, as Gregg knew, neither he nor the other person had lent 1717 Marketplace, LLC funds in those amounts.
This case is being prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. It was investigated by the FDIC Office of Inspector General and IRS-Criminal Investigation.Special Agent for Hacienda Sentenced to 18 Months Incarceration for Bribing an Hacienda Tax AuditorRead the Press Release
SAN JUAN, P.R. – Ricardo Fernàndez-Ramos was sentenced to 18 months incarceration, followed by three years supervised release, and 200 hours of unpaid community service by United States District Court Judge Carmen Consuelo Cerezo for bribing one of his colleagues at the Puerto Rico Department of Treasury (“Hacienda”), announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. At the time of his arrest on public corruption charges, back in July of 2011, Fernàndez-Ramos held the position of Special Agent for the Department of Hacienda assigned to the Tax Crimes Division in the Mayagüez District where he was responsible for investigating tax evasion crimes committed against the Government of Puerto Rico.
The Indictment in this case charged that from approximately September 2010 through December 2010, Fernàndez-Ramos corruptly gave, offered, and agreed to give a thing of value, namely $12,500 in cash, to an Hacienda tax auditor for the purpose of influencing and rewarding her in relation to an audit that she was conducting on the 2008 and 2009 individual tax returns of an Isabela business owner.
As part of his plea agreement with the United States government, Fernàndez-Ramos was permitted to argue for a sentence as low as probation, while the United States reserved the right to argue for a sentence as high as 18 months incarceration. During the sentencing hearing, the government argued that this was a classic case of public corruption and that a sentence of probation would send the wrong message to the community at large—a message that indeed Puerto Rico was the “Isla de Chanchullo,” or “Island of Deceit.” In the end, the Court stated for the record that the reasons presented by the defense in favor of a sentence of probation fell well short of their mark. Instead, the Court ruled that, given the facts of this case, incarceration was the more appropriate sentence. The Court granted Fernàndez-Ramos until April 1, 2013, to voluntarily surrender himself to the Federal Bureau of Prisons. The case was prosecuted by Assistant U.S. Attorney Marshal D. Morgan.
“This case should serve as a stark reminder to everyone that if you engage in public corruption and steal from the Government of Puerto Rico, you should plan on spending the next few years of your life in a Federal prison,” stated U.S. Attorney Rodríguez-Vélez. The Puerto Rico community can rest assured that the investigation and prosecution of public corruption crimes is one of the highest priorities of the United States Department of Justice.”
“Combating public corruption is a priority for the FBI in San Juan,” said Carlos Cases, Special Agent in Charge of the FBI-San Juan Field Office. “We will continue to aggressively investigate and bring to justice any public official who abuses the public's trust and use their position for personal gain”.
Sherron Grace American Horse 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 March 6, 2013, before Chief U.S. District Judge Richard F. Cebull, SHERRON GRACE AMERICAN HORSE, a 38-year-old resident of Ashland and an enrolled member of the Northern Cheyenne Tribe, pled guilty to involuntary manslaughter and assault resulting in serious bodily injury. Sentencing has been set for June 5, 2013. She is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Lori Harper Suek, the government stated it would have proved at trial the following:
On June 22, 2012, law enforcement responded to a car crash on the Northern Cheyenne Indian Reservation at approximately 1:00 p.m. The officers found one deceased passenger lying outside of the car. Several other passengers were also at the scene and suffered minor to severe injuries. All at the scene identified AMERICAN HORSE as the driver.
While taking photographs at the scene, the officers saw footprints leading away from the crash site and followed them. They found AMERICAN HORSE lying near the road. She appeared to be sleeping. The officers woke her up to determine if she needed medical attention. As she sat up, an unopened can of malt liquor was under her body. Her speech was slurred.
AMERICAN HORSE was taken by ambulance to the Lame Deer Clinic and later treated at the Billings Clinic. A blood alcohol sample was taken some hours after the crash and registered a .169.
AMERICAN HORSE was interviewed several days later. She admitted that she had been drinking and driving at the time of the crash. Through her admissions, the statements of the surviving passengers, and the investigation at the scene, law enforcement learned that AMERICAN HORSE was very drunk, lost control of the car, and rolled the car at least four times. She caused the death of one passenger and another passenger suffered a spinal injury that has resulted in partial paralysis.
AMERICAN HORSE faces possible penalties of 10 years in prison, a $250,000 fine and 3 years supervised release on the involuntary manslaughter charge and 8 years in prison, a $250,000 fine and 3 years supervised release on the assault resulting in serious bodily injury charge.
The investigation was a cooperative effort between the Bureau of Indian Affairs and the Federal Bureau of Investigation.
Sex Offender Sentenced for Possessing Child PornographyRead the Press Release
MINNEAPOLIS—Earlier today in federal court, a 29-year-old registered sex offender from Woodland Township in central Minnesota was sentenced for possession of child pornography. United States District Court Judge Patrick J. Schiltz sentenced Jeremy Lee Klepperich to 160 months in prison on one count of possession of child pornography. Klepperich was charged on July 31, 2012, and pleaded guilty on October 2, 2012. Because the federal system does not have parole, Klepperich will serve virtually his entire prison sentence behind bars.
In his plea agreement, Klepperich admitted that on June 6, 2012, he possessed one or more matters containing visual depictions of a minor engaged in sexually explicit conduct. Klepperich owned a computer thumb drive containing approximately 4,270 images and 56 videos of child pornography.
In 2011, Klepperich pleaded guilty in state court in Wright County on one count of possession of pornography by a sex offender. The sentence in that case mandated that Klepperich, whose prison term was stayed, refrain from possessing any drugs, drug paraphernalia, pornography, or other sexually explicit material. On two different occasions (April 27, 2011 and June 7, 2012), Klepperich was arrested by local law enforcement for violating the terms of his 2011 stay of sentence. An unnamed individual informed authorities of Klepperich’s thumb drive among other digital media, which contained child pornography. Klepperich’s criminal history includes a 1997 McLeod County, Minnesota, conviction for sexual penetration of a minor male he was babysitting and a 2009 conviction in Hennepin County for failure to register as a predatory offender.
This case was the result of an investigation by the Minnesota Child Exploitation Task Force, which is sponsored by the Federal Bureau of Investigation. Assistance was provided by the Minnesota Department of Corrections, the Hutchinson Police Department, and the Wright County Sheriff’s Office, which is an affiliate of the Minnesota Internet Crimes Against Children Task Force. The case was prosecuted by Assistant U.S. Attorney Laura M. Provinzino.Possession of child pornography is against the law. In addition to prosecuting these cases, the Justice Department is presently funding a study focused on the correlation between involvement in child pornography and hands-on sexual abuse of children. A 2008 study (The Butner Study) published in the Journal of Family Violence found that up to 80 percent of federal inmates incarcerated for possession, receipt, or distribution of child pornography also admitted to hands-on sexual abuse of children, ranging from touching to rape.
This case was brought as part of Project Safe Childhood (PSC), 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 U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, PSC marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children and identify and rescue victims. For more information about PSC, please visit http://www.justice.gov/psc/ For more information about internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab “resources.”Rosebud Man Pleads Guilty to Assault with A Dangerous WeaponRead the Press Release
United States Attorney Brendan V. Johnson announced that Aaron Sharpfish, age 21, of Rosebud, South Dakota appeared before U.S. District Judge Roberto A. Lange on March 5, 2013 and pled guilty to Assault with a Dangerous Weapon. The maximum penalty upon conviction is 10 years in custody, a $250,000 fine, or both; 3 years of supervised release; and a $100 special assessment.
The conviction stems from an incident that took place on November 21, 2011 when Sharpfish hit the victim causing him to fall to the ground. Sharpfish then kicked the victim in the head and face several times causing a fracture to the victim’s eye.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. The case is being prosecuted by Assistant U.S. Attorney Marie H. Ruettgers.
A presentence investigation was ordered and a sentencing date was set for May 15, 2013. The defendant was remanded to the custody of the U.S. Marshal pending sentencing.
Rochester Man Sentenced for Role in Drug ConspiracyRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Angel Gonzalez, 28, of Rochester, N.Y., who was convicted of conspiracy to possess with intent to distribute 500 grams or more of cocaine, was sentenced to 97 months in prison by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorneys Jennifer M. Noto and Robert A. Marangola, who handled the case, stated that between June 2011 and June 2012, the defendant participated in an armed drug conspiracy operating in the Rochester, New York area. Gonzalez and other members of the conspiracy were responsible for the distribution of significant quantities of cocaine and crack cocaine throughout the Rochester area. The investigation involved court-authorized wire taps and resulted in the arrest of nine related defendants. To date, eight of the nine defendants have been convicted. Angel Gonzalez is the first defendant to be sentenced in connection with this armed drug distribution ring.
The sentencing is the culmination of an investigation on the part of Special Agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Scott Heagney and Investigators of the Rochester Police Department, under the direction of Chief James Sheppard.Robeson County Man Convicted in Drug ConspiracyRead the Press Release
RALEIGH - United States Attorney Thomas W. Walker announced that in federal court today Chief District Court Judge James C. Dever sentenced KENDALL LADELL BLUE, 34, of Red Springs, North Carolina, to 21 years’ imprisonment for his role in a drug trafficking conspiracy.
On October 25, 2011, a grand jury in the Eastern District of North Carolina issued an indictment charging BLUE with Conspiring to Possess with Intent to Distribute and Distribute 28 Grams or More of Crack Cocaine, several counts of Distributing Crack Cocaine and other related charges. On August 8, 2012, after a jury trial, BLUE was convicted of all the drug charges.
The evidence in the case established that from 2002, up through and including April 15, 2010, BLUE was operating a garage off of Huggins Road in Red Springs, North Carolina. During that time frame, BLUE bought cocaine from several sources of supply and then sold the substance as crack cocaine to other customers for re-distribution. According to the evidence presented at the sentencing, BLUE was armed
with a firearm during each drug transaction. The evidence also established that BLUE provided a materially false affidavit to the presiding judge prior to trial. Based on BLUE’s role in the drug trafficking conspiracy, he was sentenced to 252 months’ imprisonment and 4 years of supervised release following his prison term.Investigation of this case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives as well as the Robeson County Sheriff's Office. Assistant United States Attorney Rudy E. Renfer represented the government.
Renewal, Inc. Resident Charged with Escaping from Federal CustodyRead the Press Release
PITTSBURGH, Pa. - Tyrenzo Morton has been indicted by a federal grand jury in Pittsburgh for escaping from federal custody while serving a prison sentence, United States Attorney David J. Hickton announced today.
The one-count indictment, returned on March 5, names Morton, 27, of Pittsburgh, Pennsylvania, as the sole defendant.
According to the indictment, on Dec. 23, 2012, Morton escaped from federal custody at Renewal, Inc., where he was serving the remaining portion of a federal prison sentence.
The law provides for a maximum total sentence of up to five years in prison, a fine of up to $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Craig W. Haller is prosecuting this case on behalf of the United States.
The United States Marshals Service and the Pittsburgh Bureau of Police investigated this case leading to the capture and indictment of Morton.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Rafael Antonio Murillo Pleads Guilty to Illegal Re-entryRead the Press Release
RAFAEL ANTONIO MURILLO, age 41, a citizen of El Salvador, pled guilty in federal court today before U. S. District Judge Ivan L. R. Lemelle to a one-count indictment charging him with illegal re-entry by a removed alien, announced U. S. Attorney Dana Boente.
According to court documents, MURILLO admitted to being an alien who had previously been removed from the United States, was found in the United States, in Jefferson Parish, Louisiana on December 19, 2012, without having obtained consent from the Secretary of the Department of Homeland Security to reapply for admission to the United States.
The indictment charging MURILLO with illegal re-entry 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 May 29, 2013 at 2:00 P.M.The case was investigated by U. S. Immigration and Customs Enforcement (ICE) - Enforcement and Removal Operations with the assistance of the Jefferson Parish Sheriff’s Office. The case is being prosecuted by Special Assistant U. S. Attorney Robert Weir.
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Postal Worker Charged with Stealing MailRead the Press Release
PITTSBURGH, Pa. - A postal worker has been indicted by a federal grand jury in Pittsburgh on charges of theft of mail by a postal employee, United States Attorney David J. Hickton announced today.
The two-count indictment, returned on March 5, named Christopher L. Demorest, Sr., 39, of Greensburg, Pa., as the sole defendant.
According to the indictment, on or about March 29, 2012, Demorest, a Postal Service employee, embezzled a greeting card, which had been entrusted to him and which had come into his possession intended to be conveyed by mail. The indictment also charges that on or about April 25, 2012, Demorest embezzled two additional greeting cards.
The law provides for a maximum total sentence of 10 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Mary McKeen Houghton is prosecuting this case on behalf of the United States.
The United States Postal Service, Office of Inspector General, conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Postal Service Employee Charged with Embezzling Mail ParcelsRead the Press Release
PITTSBURGH, Pa. - Shaun G. Westfall of Baden, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on charges of theft of mail by a postal employee, United States Attorney David J. Hickton announced today.
The two-count indictment, returned on March 5, named Shaun G. Westfall, 32, as the sole defendant.
According to the indictment, on or about June 13, 2012, Westfall, a Postal Service employee, embezzled two parcels of mail, which had been entrusted to him and which had come into his possession intended to be conveyed by mail.
The law provides for a maximum total sentence of 10 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Mary McKeen Houghton is prosecuting this case on behalf of the United States.
The United States Postal Service, Office of Inspector General and the Veterans Administration conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Porcupine Man Pleads Guilty to AssaultRead the Press Release
United States Attorney Brendan V. Johnson announced that Angelo Perez, age 33, of Porcupine, South Dakota appeared before Chief U.S. District Judge Jeffrey L. Viken on February 28, 2013 and pled guilty to Assault Resulting in Serious Bodily Injury. The maximum penalty upon conviction is 10 years of imprisonment and a $250,000 fine.
The charge relates to Perez assaulting a female on September 14, 2012 near Porcupine. The investigation was conducted by the Bureau of Indian Affairs, Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. The case is being prosecuted by Assistant U.S. Attorney Wayne Venhuizen.
A presentence investigation was ordered and a sentencing date was set for June 26, 2013. The defendant was remanded to the custody of the U.S. Marshal pending acceptance of this plea and sentencing.