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Friday 25 January 2013
Reynoldsburg Man Pleads Guilty to Possessing More Than 10,000 Images and 300 Videos of Child PornographyRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS – Zdenek Hrouda, 37, of Reynoldsburg, Ohio pleaded guilty in U.S. District Court to possessing child pornography after investigators found more than 10,000 still images and 300 video files stored on three computers and two external hard drives in his house.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, Edward J. Hanko, Special Agent in Charge, Federal Bureau of Investigation (FBI), Reynoldsburg Police Chief James Oneill, and Franklin County Sheriff Zach Scott whose office includes the Franklin County Internet Crimes Against Children Task Force (ICAC) announced the plea entered today before U.S. District Judge Michael Watson.
According to court testimony today by a Reyoldsburg Police Officer on the ICAC task force, in June 2012 an ICAC investigator was patrolling the internet and identified an IP address that was a download candidate for suspected child pornography. Officers searched his home on July 5, 2012 and found the computers.
When Hrouda learned he was under investigation, he fled back to his home country, the Czech Republic. He returned to the United States voluntarily in October 2012.
Possession of child pornography is punishable by up to ten years in prison, a fine of up to $250,000 and at least five years of supervised release. While on supervised release, he will also have to register as a sex offender anywhere he lives, works or goes to school.
Stewart commended the investigation by the ICAC Task Force, the FBI and Assistant U.S. Attorney Deborah A. Solove, who represented the United States in the case.
Restaurateur Sentenced to Probation for Tax FraudRead the Press Release
PITTSBURGH - A resident of Pittsburgh has been sentenced in federal court three years probation on his conviction of committing tax fraud, United States Attorney David J. Hickton announced today.
Chief United States District Judge Gary L. Lancaster imposed the sentence on Thomas N. Liadis, Sr., age 61.
According to information presented to the court, Liadis was the owner of the Grecian Isles local chain of Greek restaurants in the Pittsburgh area, with locations at the PPG building, USX Tower, and Station Square. In 2010, Liadis was targeted in a proactive IRS investigation into restaurant owners that were not reporting their gross receipts accurately to the IRS. At that time, Liadis had listed his restaurants for sale and in order to sell his restaurants, was disclosing each restaurant's total revenue. As part of the undercover investigation, these figures were compared with the numbers disclosed in Liadis's IRS 1040 tax returns, and discovered to be significantly higher. During the undercover operation, Liadis provided records to an IRS agent posing as a prospective buyer that supported the higher figures that were reported as part of the sale of the business, and not the numbers reported on Liadis' prepared tax returns. Liadis further admitted to the IRS undercover agent that he under-reported income to the IRS. A search warrant was executed at Liadis' businesses and residence and records were seized. The records indicating the actual gross receipts for Liadis' businesses were recovered. Comparison of Liadis' business records with his IRS filings for the tax years 2007, 2008, and 2009 indicate that Liadis under-reported a total of $1,011,369 of receipts resulting in a tax loss of $103,706. Specifically, on or about April 15, 2010, Thomas Liadis filed his United States Individual Income Tax Return Form 1040 for the 2009 tax year, which was verified by him in a written declaration that it was made under the penalties of perjury and filed with the Internal Revenue Service, that declared that the gross receipts of the Island Café at Station Square was $121,791 when in fact records obtained from Liadis indicated that his true gross receipts for Island Café in 2009 were $414,076.51.
Assistant United States Attorney James T. Kitchen prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Internal Revenue Service (IRS) for the investigation leading to the successful prosecution of Liadis.
Pittsburgh-based Bank to Pay U.S. for Failing to Engage in Prudent Underwriting Practices on SBA Loan GuaranteesRead the Press Release
PNC Bank N.A. has agreed to pay the United States $7.1 million to settle claims under the False Claims Act that it failed to engage in prudent underwriting practices in connection with the issuance of loans guaranteed by the Small Business Administration (SBA), the Justice Department announced today. PNC has also agreed to take corrective action to prevent similar occurrences in the future. PNC is a national banking association located in Pittsburgh.
The SBA Act allows banks to partner with the SBA to make loans to qualified small businesses. Participants in the SBA’s Preferred Lenders Program, like PNC, have authority to make and close these loans without obtaining the prior approval of the SBA. SBA guaranteed 75 percent of the balance of the loans in question. Banks are required to exercise prudent lending standards when making loans under the Preferred Lenders Program.
In 2005, under the Preferred Lender Program, PNC issued 64 SBA-guaranteed loans for the purchase of 98 Uni-Marts stores located primarily in the mid-Atlantic region. The United States alleges that in connection with these loans, PNC relied upon unaudited financial statements without further verifying whether the information contained in the financial statements was accurate. Of the 64 SBA-guaranteed loans issued by PNC, 36 have defaulted, triggering SBA’s obligations to pay PNC 75 percent of the balance of the defaulted loans. In May 2008, Uni-Marts filed for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code.
“Banks that are SBA preferred lenders have a duty to prudently guard the public funds they commit to borrowers,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “The government will pursue vigorously lenders that fail to adequately safeguard public funds due to deficient lending standards.”
Principal Deputy Assistant Attorney General Delery thanked the Justice Department’s Civil Division, the SBA Office of General Counsel and the SBA Office of Inspector General for the collaboration that resulted in the settlement announced today. The claims settled by this agreement are allegations only; there has been no determination of liability.
Paralegal Sentenced to 30 Months for Role in Property Mortgage ScamRead the Press Release
BOSTON - A Roslindale woman was sentenced yesterday for her role in a multi-year, multi-property mortgage fraud scheme.
Rebecca L. Konsevick, 40, was sentenced by U.S. District Judge Denise J. Casper to 30 months in prison, to be followed by two years of supervised release. In May 2012, Konsevick pleaded guilty to bank fraud and money laundering.From 2006 through 2008, Konsevick committed fraud in connection with condominium sales. Sirewl Cox, a developer, identified multiple-family buildings for sale and recruited straw buyers to purchase the buildings. Cox and others then recruited straw buyers to purchase individual units in buildings. The straw buyers’ financing for the purchases was obtained by falsely representing key information to mortgage lenders such as the buyers’ income, employment, assets, and/or intention to reside in the condominiums. In addition, Konsevick and Cox caused HUD-1 settlement statements to be submitted to the same lenders which falsely represented that straw buyers had paid funds in connection with the property transactions and falsely represented how the proceeds of the mortgage loans were disbursed. In Massachusetts, property transactions must be closed by attorneys so Konsevick, who was a paralegal, falsely signed certifications on these HUD-1 settlement statements and closed the relevant property deals.
Sirewl Cox was convicted by a jury of wire fraud, bank fraud, and conducting an unlawful monetary transaction. Sentencing is scheduled for Feb. 6, 2013.
United States Attorney Carmen M. Ortiz; Steven D. Ricciardi, Special Agent in Charge of the U.S. Secret Service; William P. Offord, Special Agent in Charge of Internal Revenue Service’s Criminal Investigations in Boston; Kevin Niland, Inspector in Charge of the U.S. Postal Inspection Service; and Cary Rubenstein, Special Agent In Charge of the U.S. Department of Housing and Urban Development, Office of the Inspector General, New York Regional Office; made the announcement today. The case was prosecuted by Assistant U.S. Attorneys Ryan M. DiSantis and Jeremy M. Sternberg of Ortiz’s Economic Crimes Unit.Monroe Doctor Sentenced for Distributing Growth HormonesRead the Press Release
More than $400,000 worth of illegal hormones sold
SHREVEPORT, La: United States Attorney Stephanie A. Finley announced today that Dr. Linda Camille Bunch Wells, 53, of Monroe, was sentenced Thursday to 27 months in federal prison and ordered to forfeit $200,000 in criminal proceeds for importing and distributing adult growth hormones.
In June 2010, Wells was charged in a 21-count indictment with conspiracy, distribution, and facilitation and receipt of smuggled hGH. She was administering the growth hormones at the Northeast Louisiana Anti-Aging and Wellness Center in Monroe from July 2003 until July 2008. The hormones were part of a so-called anti-aging program for patients. Most of the hormones administered were illegally imported into the U.S. Wells and her business partners would buy the drugs overseas, and the packages would be labeled non-medial products in order to pass through U.S. Customs.
Under federal law, growth hormones may only be used for the treatment of specified diseases. Although Wells was only held accountable for distributing $200,000 in illegal growth hormones, evidence at sentencing revealed that the company administered more than 26,926 units of the hormones over the five-year period totaling more than $406,000 in sales.
“We will prosecute those who circumvent the law to provide controlled substances to patients for personal gain, ”U.S. Attorney Stephanie A. Finley said. “Those involved in this operation knowingly obtained these hormones illegally and released them into the community with no concern for the safety of those who were taking them.”
The Food and Drug Administration/Office of Criminal Investigations and Louisiana State Police conducted the investigation. Assistant U.S. Attorney Earl Campbell prosecuted the case.
Missouri Man Sentenced for Production of Child PornographyRead the Press Release
Gary A. McArthur, 50, of Arnold, Missouri, was sentenced on January 25, 2013, to a term of 180 months in prison on a one-count indictment charging him with Production of Child Pornography, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
McArthur was also ordered to serve a term of lifetime supervised release following his imprisonment. There is no parole in the federal system. Additionally, McArthur was fined $1,250 and ordered to pay a $100 special assessment. McArthur pled guilty to the indictment on October 18, 2012 and has been detained (held without bond) since his arraignment on June 15, 2012.
Court documents establish that the violation occurred between September 2011 and March 31, 2012, when McArthur resided with a friend, R.H., and her minor relative in Madison County, Illinois. On March 31, 2012, R.H. reported to the Madison County Sheriff’s Department that she had discovered that McArthur had been engaged in a continuing sexual relationship with her 13-year old minor relative. In a recorded interview with the Madison County Sheriff’s Department, McArthur admitted that he had been having sexual intercourse with the 13-year old minor for several months. McArthur is currently charged in the Madison County Circuit Court with four counts of Aggravated Criminal Sexual Abuse for those acts. Of course, a charge is not proof of guilt. McArthur is presumed innocent of the charge until proven guilty beyond a reasonable doubt.
The federal charges came about when, after McArthur was arrested, a detective with the Madison County Sheriff’s Department, who also serves as a Special Investigator with the FBI Cyber Crimes Task Force, performed a forensic examination of McArthur’s cellular phone. It was discovered that on March 7, 2012, McArthur had taken a pornographic photograph of the victim depicting the minor’s nude genital area.
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 case was prosecuted by Assistant United States Attorneys Ali Summers and Nathan Stump.
Madison Woman Sentenced for Embezzling Funds from EmployerRead the Press Release
Amy M. Shelby, 38, of Madison, IL, was sentenced to fifteen months in prison, to be followed by three years on supervised release, and restitution of $112,383.52, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Shelby was indicted by a grand jury in July 2012 and later Shelby plead guilty to the federal offense of wire fraud.
The instant offense was investigated by the Federal Bureau of Investigations (FBI), following a complaint made by James Green Management (JGM), the owner and management office of Oakmont Mini-Storage. Prior to the complaint, Pitney Bowes Visa credit card company contacted JGM to inquire about delinquent payments on an existing Pitney Bowes account, which JGM was unaware existed. Subsequent audit results found Amy Shelby, the manager of Oakmont Mini- Storage, had applied for a Pitney Bowes commercial credit card for Oakmont Mini-Storage in 2006, which held her name. Amy Shelby had used the commercial credit card to purchase numerous fraudulent charges which included personal purchases such as for perfume and satellite television service, payments for personal bills, and a monthly credit report service. The audit also found Shelby had access to Oakmont Mini-Storage’s operating bank account(s), and she was paying the Pitney Bowes credit card bills, and additional personal bills, with company funds. In addition, the audit found Shelby had simply kept numerous cash deposits and/or payments made to Oakmont Mini- Storage for storage units.
The prosecution was handled by Assistant U.S. Attorney Norman R. Smith.
Lubbock Man Sentenced to Nine Years in Federal Prison on Child Pornography ConvictionRead the Press Release
LUBBOCK, Texas — James Galen Brown, 40, of Lubbock, Texas, was sentenced this morning by U.S. District Judge Sam R. Cummings to nine years in federal prison and a 10-year term of supervised release, following his guilty plea in October 2012 to one count of transportation of child pornography. Brown admitted that he used his cell phone, and its texting functions, to intentionally send and receive images and videos of child pornography. Judge Cummings ordered that Brown surrender to the Bureau of Prisons on March 1, 2013. 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, on June 1, 2012, Special Agents with U.S. Immigrations and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) interviewed Brown after receiving information that a telephone number assigned to Brown had received text messages with attachments of child pornography. Brown admitted that he used the cell phone to communicate with other individuals who shared an interest in sexually explicit images and videos of minors, and he used his cell phone to trade the material with those persons. He located these persons on Internet chat rooms and exchanged phone numbers with them, and then traded the child pornography images and videos by attaching them to text messages.
This matter was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better 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.justice.gov/psc/ For more information about internet safety education, please visit www.justice.gov/psc/ and click on the tab "resources."
Assistant U.S. Attorney Steven M. Sucsy was in charge of the prosecution.
Lubbock Man Sentenced to 135 Months in Federal Prison for Downloading Child Pornography from the InternetRead the Press Release
LUBBOCK, Texas — Richard Mendoza, 22, of Lubbock, Texas, was sentenced this morning by U.S. District Judge Sam R. Cummings to 135 months in federal prison and a 15-year term of supervised release, following his guilty plea in October 2012 to one count of receipt of child pornography. He has been in custody since his arrest in August 2012. 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, in January 2012, while searching on the Internet for videos depicting minors engaging in sexually explicit conduct, Mendoza intentionally and knowingly downloaded a digital video file depicting a female child, under the age of 18, engaged in sexually explicit conduct.
This matter was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better 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.justice.gov/psc/ For more information about internet safety education, please visit www.justice.gov/psc/ and click on the tab "resources."
The case was investigated by the FBI and prosecuted by Assistant U.S. Attorney Steven M. Sucsy.
Last of Three Defendants Sentenced to More Than 22 Years in Prison for Two Armed Robberies in MonroeRead the Press Release
CHARLOTTE, N.C. – On Wednesday, January 23, 3013, the last of three defendants involved in armed robberies of two Monroe businesses in October 2010 was sentenced to 268 months in prison, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
In addition to the prison term, U.S. District Court Judge Max O. Cogburn, Jr. ordered Reginald Lamont Chambers, 27, of Monroe, to serve three years of supervised release and to pay $3,100 as restitution.
Joining U.S. Attorney Tompkins in making today’s announcement are Wayne L. Dixie, Special Agent in Charge of the U.S. Bureau of Alcohol Tobacco Firearms and Explosives (ATF), Charlotte Field Division and Chief Debra C. Duncan of the Monroe Police Department.
According to filed court documents and statements made in court, on October 18, 2010, Chambers robbed a Dollar General store on East Sunset Drive in Monroe. During the robbery, Chambers held the store clerk at gun point and forced the store clerk to open the safe. Court records show that Chambers then ripped the store’s telephones out of their jacks and took the phones with him. Chambers also attempted to lock the store clerk in the back office before leaving with the store’s money.
According to court documents and statements made in court, October 20, 2010, Chambers and his co-defendants, Anthony Polk and Trenton Raley, robbed La Chiquita store on Concord Avenue, in Monroe. Chambers and Raley held up at gun point two store clerks, and robbed money from the store and one of the clerk’s purses and its contents. Polk was the get-away driver in the robbery. Court records show that all three defendants were arrested in the early morning hours on October 21, 2010, in the get-away car and in possession of the firearms used by Chambers and Raley.
In December 2011, Chambers, who is a member of the United Blood Nation street gang, pleaded guilty to two counts of robbery of a business affecting interstate commerce, also known as “Hobbs Act” robberies, one count of carrying and brandishing a firearm in furtherance of robbery, and one count of possession of a firearm by a convicted felon. Under the United States Sentencing Guidelines, Chambers was sentenced as a an armed career criminal. v
On November 29, 2011, Raley, 20, of Peachland, N.C., pleaded guilty to one count of Hobbs Act robbery and one count of carrying and brandishing a firearm in furtherance of a crime. He was sentenced also sentenced on Wednesday, January 23, 2013, to serve 67 months in prison followed by three years of supervised release. On December 1, 2011, Polk, 30, of Monroe, pleaded guilty to one count of Hobbs Act robbery. He was sentenced on October 23, 2012, to 51 months in prison and three years of supervised release. Raley and Polk will be jointly and severally liable with Chambers for restitution to the victims of the La Chiquita robbery.
All three defendants are in local federal custody. Upon designation of a federal facility they will be transferred to the custody of the Federal Bureau of Prisons. Federal sentences are served without the possibility of parole.
The investigation was handled by the ATF and the Monroe Police Department. The prosecution was handled by Assistant United States Attorney J. George Guise.
Jury Finds Defendant Guilty of Tax Evasion, Failure to File ReturnsRead the Press Release
PITTSBURGH - After deliberating for 1½ hours, a federal jury of six men and six women found Thomas D. Tuka guilty of four counts of income tax evasion and three counts of failure to file tax returns, United States Attorney David J. Hickton announced today.
Tuka was tried before United States District Judge Terrence F. McVerry in Pittsburgh, Pa.
According to Assistant United States Attorney Leo M. Dillon, who prosecuted the case, the evidence presented at trial established that Tuka failed to file taxes, and evaded income tax on more than $480,000 in taxable disability income he received during the period from 2003 to 2008.
Judge McVerry scheduled sentencing for May 24, 2013 at 10:30 a.m. On each of the four tax evasion counts, the law provides for a maximum total sentence of five years in prison, a fine of $250,000, three years supervised release and a $100 special assessment. The maximum penalty for each of the failure to file counts is one year imprisonment, a fine of $100,000, one year supervised release and a $25 special assessment. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Pending sentencing, the court continued the defendant on bond.
The Internal Revenue Service, Criminal Investigation conducted the investigation that led to the prosecution of Tuka.
Juneau Man sentenced to 170 months for drug conspiracyRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen Loeffler announced today that a Juneau resident was sentenced in Juneau to federal prison for drug conspiracy.
U.S. District Court Judge Timothy M. Burgess sentenced Juneau resident Darrell W. Dawson, 44, to 170 months in prison, for his role in a drug trafficking conspiracy. There is no parole in the federal system.
According to Assistant U.S. Attorney Jack S. Schmidt, who prosecuted the case, the charges arose from a joint investigation involving the Federal Bureau of Investigation, United States Postal Inspection Service and Juneau Police Department - Drug Metro Unit involving the importation of methamphetamine into Juneau, Alaska, using a United States Postal Service USPS Express Mail parcel. In July 2012, Darrell W. Dawson and Gema G. Thomas conspired to transport methamphetamine from the lower 48 to Juneau, Alaska. Dawson provided Thomas $15,000.00 in drug proceeds for six ounces of methamphetamine. Thomas arranged for and paid for the delivery of six ounces of methamphetamine to be delivered to her business, Peer-Amid Beads, from her source of supply in the lower 48 via USPS Express Mail. Once received, Thomas delivered the methamphetamine to Dawson who distributed the methamphetamine to others in the Juneau area and collected drug proceeds for future payment to Thomas for an additional six ounces of methamphetamine. Thomas is scheduled to be sentence on March 8, 2013, for her role in the drug conspiracy.
Prior to imposing sentence, Judge Burgess stated the serious of the offense, deterrence of the defendant and others, the protection of the public, and rehabilitation of the defendant related to his criminal history as reasons that supported the imposition of the above sentence.
Ms. Loeffler commended the Federal Bureau of Investigation, United States Postal Inspection Service, and Juneau Police Department - Drug Metro Unit for the investigation leading to the successful prosecution of Dawson.
Judge Sentences Miami Men for December 2010 Murder of Postal Worker in Identity Theft SchemeRead the Press Release
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, Antonio J. Gomez, Acting Inspector in Charge, U.S. Postal Inspection Service, José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CI), J.D. Patterson, Acting Director, Miami-Dade Police Department, and Marc Elias Jr., Chief, North Miami Police Department, announce the sentence of Pikerson Mentor, 30, of Miami, to a life imprisonment. Saubnet Politesse, 24, was sentenced to 21 years imprisonment after pleading guilty to being Mentor’s getaway driver during the robbery resulting in U.S. Postal Service employee Bruce Parton’s death. Both sentences were imposed by U.S. District Court Judge Donald Graham.
Mentor had been previously convicted after a seven-day trial, during which approximately 40 witnesses were called. At the conclusion of that trial, the jury convicted Mentor of all fourteen counts of the Second Superseding Indictment, which included the murder of a federal government employee while in the course of his duties, in violation of Title 18, United States Code, Sections 1114 and 111; car-jacking, in violation of Title 18, United States Code, Section 2119; theft of a key for a U.S. Postal Service mail receptacle, in violation of Title 18, United States Code, Section 1704; use of a firearm in the commission of a crime of violence, in violation of Title 18, United States Code, Section 924(j); conspiracy to commit and commission of access device fraud, in violation of Title 18, United States Code, 371 and 1029(a)(2); and aggravated identity theft, in violation of Title 18, United States Code, Section 1028A.
U.S. Attorney Wifredo A. Ferrer stated, “The sentences imposed today on the defendants for the ruthless murder of Bruce Parton, a hard-working and dedicated mail carrier, should send a clear message to our community: there are lifelong consequences to senseless acts of violence. I hope that the life imprisonment sentence of Pikerson Mentor, and 21 years imprisonment sentence of Saubnet Politesse, will bring some comfort and sense of justice to Mr. Parton’s family.”
Antonio J. Gomez, Acting Inspector in Charge for U.S. Postal Inspection Service stated, “Today’s sentencing is the result of the U.S. Postal Inspection Service working diligently with law enforcement partners to make sure that U.S. Postal Service employees are protected.”
“The death of U.S. Postal Service employee Bruce Parton is an absolute tragedy, and individuals who commit crimes of this magnitude deserve to be punished to the fullest extent of the law,” said Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI). “Faced with the unique circumstances of this case, IRS Criminal Investigation along with our law enforcement partners and the United States Attorney's Office were committed to investigating and prosecuting these individuals who chose personal monetary gain over the value of another human being's life.”
“We hope that the family of Mr. Parton has found some justice with today’s sentencing. We are grateful for the cooperation and dedication of all the agencies that lead to the successful arrests and prosecution of the case,” said J.D. Patterson, Acting Director of the Miami-Dade Police Department.
North Miami Police Department Chief Marc Elias, Jr. stated, “The North Miami Police Department is proud to have worked in partnership with the United States Postal Inspection Service and our Federal and Local law enforcement agencies in bringing the murderers of Bruce Parton of the U.S. Postal Services to justice. This is another example of law enforcement agencies collaborating to remove armed and dangerous subjects from the streets of South Florida.”
According to trial evidence, U.S. Postal Service letter carrier Bruce Parton was murdered on December 6, 2010 as he delivered mail to the Monte Carlo apartment complex in northwest Miami. Mentor and his accomplices stole the victim’s U.S Postal master key, called an Arrow Key, and the keys to the victim’s postal truck. Postal keys are used by letter carriers to access mailboxes. Witnesses testified that they heard two shots at the scene, and an eyewitness testified that she saw the defendant fleeing the apartment complex in the victim’s stolen truck. In addition, Saubnet Politesse, a co-conspirator who testified regarding his role in the conspiracy, confirmed that Mentor had shot the victim mail carrier. In addition, witnesses explained how the defendants used the stolen master key to enter mailboxes to steal private financial and personal identification information and to intercept debit cards loaded with fraudulently obtained tax refunds.
During trial, North Miami Police detectives testified about the May 4, 2011, arrest of Saubnet Politesse for driving without a license. During that arrest, the officers discovered a unique looking key with an obliterated serial number. The serial number was subsequently restored and matched the serial number of the victim’s stolen master key. Upon being questioned by the police, Politesse described his, Mentor’s and another person’s participation in the December 6 robbery and murder. Thereafter, early in the morning of May 5, 2011, defendant Mentor was arrested.
Politesse pleaded guilty to charges related to his participation in the robbery/homicide as a getaway driver. Politesse testified as a government witness and was ultimately sentenced to 21 years’ imprisonment during the sentencing hearing immediately following Mentor’s sentence.
Mr. Ferrer commended the investigative efforts of the U.S. Postal Inspection Service, IRS-CI, Miami-Dade Police Department and the North Miami Police Department. This case is being prosecuted by Assistant U.S. Attorneys Anthony LaCosta and Roy Altman.
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.
Jefferson County Man Sentenced for Nederland Bank RobberyRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A 32-year-old Nederland, Texas man has been sentenced to federal prison for robbing a bank in the Eastern District of Texas, announced U.S. Attorney John M. Bales today.
Christopher Levi Woodcock pleaded guilty on Sep. 27, 2012 to bank robbery and was sentenced to 43 months in federal prison on Jan. 24, 2013 by U.S. District Judge Ron Clark. Woodcock was also ordered to pay restitution in the amount of $1,971.00.
According to information presented in court, on Jan. 13, 2012, Woodcock entered Community Bank at 2008 Hwy 365 in Nederland and presented a note demanding money from a teller. Fingerprint analysis of the demand note and community tipsters led to the arrest of Woodcock.
This case was investigated by the FBI and the Nederland Police Department and prosecuted by Assistant U.S. Attorney John Craft. ####Gambino Organized Crime Family Associate John Burke Sentenced to Life Imprisonment for Racketeering and MurderRead the Press Release
John Burke, a longtime associate of the Gambino organized crime family of La Cosa Nostra (the “Gambino family”), was sentenced today to life imprisonment without parole plus 10 years for the murder of a rival drug dealer in aid of racketeering, racketeering conspiracy, and other charges. On June 8, 2012, following a four-week trial before United States District Judge Sterling Johnson, Jr., in Brooklyn federal court, Burke was convicted of all charges in the superseding indictment.
The sentence was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York.
As established at trial, Burke was a trusted Gambino family enforcer and drug dealer for nearly three decades. As part of the racketeering conspiracy, Burke participated in numerous acts of violence, including fatal shootings and home-invasion robberies, as well as drug trafficking involving cocaine and marijuana. Burke was convicted of two murder predicate acts, including the 1991 murder of Bruce Gotterup, who was shot in the back of the head on the boardwalk in the Rockaways, and the 1996 murder of John Gebert, who was slain under a pool table in a Woodhaven bar. The jury also found Burke guilty of the murder of John Gebert in aid of racketeering, murdering John Gebert as part of a continuing criminal enterprise, and a firearms charge.
Ms. Lynch expressed her appreciation to the Federal Bureau of Investigation, the New York State Department of Corrections and Community Supervision, the Queens County District Attorney’s Office, the United States Marshals Service, and the other members of the law enforcement community for their efforts in the investigation and prosecution of this case.
The government’s case was prosecuted by Assistant United States Attorneys Jacquelyn M. Kasulis, Evan M. Norris, and Whitman G.S. Knapp.
The Defendant:
JOHN BURKE
Age: 51Four Sentenced to Prison in Florida Community Mental Health Center CaseRead the Press Release
The owners of three Miami-area assisted living facilities and an affiliated psychologist were sentenced to prison yesterday in connection with a health care fraud scheme, involving now-defunct Miami-area health provider Health Care Solutions Network Inc. (HCSN), in which Medicare was billed for mental health treatments that were unnecessary or not provided.
The sentences were announced by U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; Michael B. Steinbach, Acting Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
U.S. District Judge Cecilia M. Altonaga sentenced Serena Joslin, 32, of Looneyville, W.Va., to 63 months in prison, following her previous guilty plea to conspiracy to commit health care fraud. Raymond Rivero, 55, Daniel Martinez, 46, and Ivon Perez, 50, all of Miami, were each sentenced to 28 months in prison. All three had previously pleaded guilty to conspiracy to violate the anti-kickback statute.
According to court documents, HCSN operated community mental health centers both in Miami and North Carolina, including partial hospitalization programs (PHP) – a form of intensive treatment for severe mental illness. HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not provided.
In Miami, HCSN obtained beneficiaries by paying kickbacks to owners and operators of assisted living facilities (ALF) or by otherwise recruiting them from the facilities and from nursing homes. Rivero, Martinez and Perez admitted during their guilty pleas to referring Medicare beneficiaries to HCSN in exchange for cash bribes. Rivero, former owner of Miami-based God Is First ALF; Martinez, former owner of Homestead, Fla.-based Mi Renacer ALF; and Perez, former owner of Homestead-based Kayleen and Denis Care Corp., are no longer permitted to operate such facilities as a condition of their guilty pleas.
According to court documents, ALF residents referred to HCSN by Rivero, Martinez and Perez were not qualified to be placed in PHP and were only selected because they had Medicare or state of Florida Medicaid benefits. In some cases, ALF patients suffered from dementia, Alzheimer’s disease or mental retardation, or were otherwise unable to benefit from mental health services.
According to court documents, Joslin, a licensed psychologist, was hired by HCSN in North Carolina in April of 2010 as a clinical coordinator and later promoted to clinical director. In those roles, she conspired with other HCSN employees to fabricate medical documents to substantiate alleged PHP treatment that was medically unnecessary and, in many instances, not even provided to the beneficiaries. Joslin admitted that many of the HCSN patients were unqualified for the PHP program because they suffered from conditions such as mental retardation and dementia, and that she directed therapists to fabricate medical records to support HCSN’s fraudulent billing to the Medicare program. Joslin was also required to surrender her North Carolina license to provide mental health treatment as part of her plea agreement.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
In addition to the prison terms, Judge Altonaga sentenced Joslin, Rivero, Martinez and Perez each to serve three years of supervised release, and ordered them to pay $4,464,728; $90,896; $76,358; and $89,245 in restitution, respectively.
The cases are being prosecuted by Special Trial Attorney William Parente and Trial Attorney Allan J. Medina of the Criminal Division’s Fraud Section. The cases were investigated by the FBI and HHS-OIG and were brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
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.
Four Highland Park Police Officers Arrested and Charged with Taking Bribes and Conspiring to Protect and Deliver Six Kilograms of CocaineRead the Press Release
Press Conference - Highland Park Police Department
A federal criminal complaint was unsealed today charging four Highland Park police officers with accepting bribes, conspiring to distribute six kilograms of cocaine, and carrying firearms in furtherance of a drug trafficking crime, United States Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Special Agent in Charge Robert D. Foley, III, of the Federal Bureau of Investigation, Chief of Police Kevin Coney, Highland Park Police Department and Michigan Attorney General Bill Schuette.
The four Highland Park police officers charged are: Anthony Bynum, 29, of Highland Park, Michigan; Price Montgomery, 38, of Highland Park, Michigan; Shawn Williams, 33, of Detroit, Michigan; and Craig Clayton, 55, of Highland Park, Michigan. Bynum and Montgomery are both police officers with the Highland Park Police Department. Bynum is also a police officer for Detroit Public Schools. Williams and Clayton are both Auxiliary (Reserve) Officers for Highland Park. Chief Coney was instrumental in assisting the FBI in its investigation of the four officers from his department.
The Criminal Complaint charges the four police officers with accepting cash bribes and with conspiring to deliver six kilograms of cocaine. According to the Criminal Complaint, Bynum and Montgomery arrested a man in August 2012 in Highland Park on a firearms offense. The officers beat the man after arresting him. While in the hospital, the man offered to pay the officers if they would dismiss the charges against him. The officers were willing to accept money in exchange for failing to appear for trial. Subsequently, the man who had been arrested by Montgomery and Bynum began working undercover for the FBI as an unpaid confidential source. During the course of the investigation, Montgomery and Bynum were captured on videotape accepting $10,000 in cash from the confidential source, in return for failing to appear at the man's trial in the Wayne County Circuit Court. On the date set for the man's trial in Circuit Court, Officers Montgomery and Bynum failed to appear as witnesses as required by subpoena, and the case was dismissed.
Later, Officers Mongtomery and Bynum agreed to transport and deliver two kilograms of cocaine for the FBI confidential source, whom the officers believed to be a drug trafficker. On November 15, 2012, Officers Montgomery and Bynum protected and delivered a shipment of what they believed to be two kilograms of cocaine from the Oakland Mall in Troy, Michigan, to a location in Taylor, Michigan. Each officer was paid $1,500 for his role in the delivery of sham cocaine. Subsequently, Officers Montgomery and Bynum recruited two additional Highland Park officers, Williams and Clayton, to help with the delivery of a second, larger shipment of cocaine. On January 23, 2013, the four Highland Park police officers delivered four kilograms of what they believed to be cocaine, again from the Oakland Mall. Each officer was paid either $1,000 or $1,500 by the confidential source for his work in protecting and transporting the sham cocaine. The four police officers each carried a firearm, and some carried their police badges, while protecting the loads of sham cocaine.
Upon conviction, each of the four defendants faces a maximum of up to forty years in prison for conspiring to distribute cocaine. In addition, the officers face a maximum of ten years in prison on the bribery charges, and an additional five year consecutive sentence for carrying a firearm during a drug trafficking offense.
United States Attorney McQuade said, "We applaud Highland Park Police Chief Coney for initiating a federal investigation into misconduct by his officers. We want to emphasize that the misconduct is limited to these four officers. Our community deserves to be served and protected by police officers who perform their jobs with integrity. Police officers who take bribes and participate in criminal activities will be discovered and prosecuted."
Special Agent in Charge Foley of the FBI said, "Police officers swear an oath to protect and serve and are held to the highest standards of ethics and conduct. The FBI led Detroit Area Public Corruption Task Force is committed to ensuring illegal acts on the part of law enforcement officers are thoroughly investigated and those officers face harsh penalties for their crimes."Highland Park Police Chief Coney stated, “"The illegal actions of these officers do not represent or reflect the ethical standards and values consistent with the Highland Park Police Department. We remain committed to providing our citizens with first class public safety and ensuring our officers display integrity at all times."
"Public corruption scandals damage the public's trust in government and harm our state's reputation," said Attorney General Schuette. "We will continue to work with U.S. Attorney Barbara McQuade, the FBI, state, and local law enforcement agencies to eliminate corruption wherever it is found."
DPS Emergency Financial Manager Roy S. Roberts stated, “"There are a corps of extremely dedicated law enforcement officers who selflessly work day and night to protect our students, teachers, staff and DPS property, and the arrest and prosecution of this one individual will ensure that their professionalism and dedication will be preserved and maintained in the public eye. While relieved that none of this activity occurred on Detroit Public Schools grounds or involved any of our students, I applaud the leadership of our police department for cooperating fully and am highly appreciative of the efforts of the agencies in the FBI-led Public Corruption Task Force who brought this matter to justice."
The case was investigated by the FBI led Public Corruption Task Force which includes Internal Revenue Service, Criminal Investigation, Environmental Protection Agency - Office of Inspector General, Housing and Urban Development - Office of Inspector General, Department of Transportation - Office of Inspector General, Michigan State Police, the Michigan Attorney General's Office and the Detroit Police Department. It is being prosecuted by Assistant United States Attorney David A. Gardey.Former Program Director and Marketers Sentenced to Prison in Florida in $205 Million Community Mental Health Fraud SchemeRead the Press Release
The former program director and two former marketers for Miami-based mental health care company American Therapeutic Corporation (ATC) have been sentenced to prison for their roles in a $205 million Medicare fraud and kickback scheme in which patients were forced to attend inappropriate treatment programs.
The sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Special Agent-in-Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher Dennis of the Health and Human Services’ Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Miami-area residents Lydia Ward, 47, a former program director, and Hilario Morris, 47, a former marketer, were sentenced today by U.S. District Judge Patricia A. Seitz in Miami federal court to 99 months and 60 months in prison, respectively. In addition to the prison term, Judge Seitz sentenced Ward and Morris each to serve three years of supervised release and ordered them to pay more than $34.1 million and $82.2 million in restitution, respectively, jointly and severally with their co-defendants.
Ward was convicted on Nov. 15, 2012, by a federal jury of conspiracy to commit health care fraud. Morris was convicted on June 1, 2012, by a federal jury of conspiracy to pay illegal health care kickbacks. Ward and Morris have been in federal custody since their convictions.
Former marketer Sandra Jimenez, 39, also from the Miami area, was sentenced to 36 months in prison yesterday, Jan. 24, 2013. In addition to the prison term, Judge Seitz sentenced Jimenez to serve three years of supervised release and ordered her to pay $20.5 million in restitution, jointly and severally with her co-defendants.
On Jan. 17, 2012, Jimenez pleaded guilty to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and to receive and pay health care kickbacks.
In pleading guilty, Jimenez admitted that she served as a marketer for ATC and American Sleep Institute (ASI). ATC, a Florida corporation headquartered in Miami, operated purported partial hospitalization programs (PHPs) in seven different locations throughout South Florida and Orlando. A PHP is a form of intensive treatment for severe mental illness. Jimenez also admitted that she and co-conspirators used related company ASI to submit fraudulent Medicare claims.
Additionally, Jimenez admitted she participated in a separate Medicare fraud scheme through Priority Home Health, a Miami home health agency that submitted fraudulent claims to Medicare for home health services. Jimenez and her co-conspirators recruited Medicare beneficiaries to Priority Home Health who did not qualify for the services.
According to the plea agreement, Jimenez’s participation in the ATC fraud and the Priority Home Health fraud resulted in $46 million in fraudulent billings to Medicare.
Evidence at Ward’s and Morris’ trials demonstrated that the defendants and their co-conspirators caused the submission of false and fraudulent claims to Medicare through ATC and ASI, and that ATC secured patients by paying kickbacks to assisted living facility owners and halfway house owners who would then steer patients to ATC.
According to the evidence, Morris was a marketer for ATC from September 2004 through October 2010, when ATC closed its doors due to the federal case. In that capacity, Morris acted as a liaison, maintaining relationships between ATC and those who were selling their patients to ATC. Morris would physically pay the kickbacks throughout North Miami and Florida’s Broward County. These patients, who attended ATC, were ineligible for the services billed to Medicare and did not receive them. After Medicare paid the claims, some of the co-conspirators then laundered the Medicare money in order to create cash to pay the kickbacks for patients.
Evidence at trial revealed that Ward was a program director at ATC’s Ft. Lauderdale, Fla., center from November 2008 until ATC’s closing in October 2010. The evidence showed Ward helped doctors at ATC sign patient files without reading them or seeing the patients, and that Ward and others would assist the owners of ATC in fabricating doctor notes, therapist notes and other documents to make it falsely appear in ATC’s patient files that patients were qualified for the individualized, specialized treatment. Included in these false and fraudulent submissions to Medicare were claims for patients who were in the late stages of diseases causing permanent cognitive memory loss and patients who had substance abuse issues and were living in halfway houses. These patients were ineligible for PHP treatments, and because they were forced by their assisted living facility owners and halfway house owners to attend ATC, they were not receiving treatment for the diseases they actually had.
ATC executives Lawrence Duran, Marianella Valera and Judith Negron were previously sentenced to 50 years, 35 years and 35 years in prison, respectively, for their roles in the fraud scheme. The 50- and 35-year sentences represent the longest federal sentences for health care fraud ordered to date in the United States.
ATC and Medlink pleaded guilty in May 2011 to conspiracy to commit health care fraud. ATC also pleaded guilty to conspiracy to defraud the United States and to pay and receive illegal health care kickbacks. On Sept. 16, 2011, the two corporations were sentenced to five years of probation per count and ordered to pay restitution of $87 million. Both corporations have been defunct since their owners were arrested in October 2010. Dozens of individuals have been convicted at trial or pleaded guilty for their participation in the scheme, including doctors Mark Willner and Alberto Ayala, who were each sentenced to 10 years in prison.
Evidence at trial showed that the ATC scheme resulted in a total of $205 million in fraudulent Medicare billings.
The cases were prosecuted by Senior Trial Attorney Jennifer L. Saulino and Trial Attorney Laura M.K. Cordova of the Justice Department Criminal Division’s Fraud Section and James V. Hayes, Assistant U.S. Attorney in the Southern District of Florida. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Former Postal Employee Pleads Guilty to Stealing Mail from People on His Route-Carrier Took Cash, Items of Value-Read the Press Release
WASHINGTON – Ronald Pretlow, 48, a former letter carrier for the U.S. Postal Service, pled guilty today to stealing mail containing checks and other items of value meant for people on his route, announced U.S. Attorney Ronald C. Machen Jr. and Paul L. Bowman, Special Agent in Charge, Capital Metro Area Field Office, U.S. Postal Service Office of Inspector General.
Pretlow pled guilty in the U.S. District Court for the District of Columbia to one count of theft of mail by a postal employee. The Honorable Rudolph Contreras scheduled sentencing for May 3, 2013. The charge carries a statutory maximum of five years in prison and a fine. Under federal sentencing guidelines, the parties have agreed that the applicable range would be a maximum of 16 months of incarceration and a fine of up to $30,000. As part of the plea agreement, Pretlow also must pay $1,500 in restitution to a victim in the case.
According to a statement of offense signed by the government as well as the defendant, Pretlow began work in February 2003 as a letter carrier with the U.S. Postal Service. In 2012, he was assigned to the Lammond-Riggs Station, 6200 North Capitol Street.
In the spring of 2012, the Postal Service received numerous complaints about missing packages and greeting cards from citizens living in zip code 20011. The U.S. Postal Service Office of Inspector General began an investigation and determined that the complaints were coming from people who resided on Pretlow’s route. Agents conducted an investigation that revealed Pretlow failed to properly handle several pieces of mail.
Additionally, on July 26, 2012, a citizen contacted the Lammond-Riggs station and reported not having received a package containing $1,500 in cash. The citizen said that the sender had written the incorrect address on the package and used the Postal Service’s online tracking service to try to find it. The package, marked as delivered by “R. Pretlow,” has never been found. Pretlow’s restitution payment is to go to this victim.
Pretlow was arrested when he reported to work on Sept. 13, 2012. In a search, agents recovered currency contained in a letter that he had stolen the previous day. In a search of Pretlow’s personal vehicle, agents recovered more than 10 items of undelivered mail that were neither addressed to nor from the defendant. These items included more than $10,000 in uncashed checks, none of which noted Pretlow as the sender or intended recipient.
In announcing the plea, U.S. Attorney Machen and Special Agent in Charge Bowman commended the work of Special Agents of the Postal Service Office of Inspector General. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Legal Assistant Angela Lawrence, Paralegal Specialist Lenisse Edloe, and Assistant U.S. Attorney Christopher R. Kavanaugh, who is prosecuting the matter.
13-024Former Middle School Teacher Pleads Guilty to Federal Child Pornography ChargeRead the Press Release
Defendant Was a Choir Teacher at Cross Timbers Middle School in Grapevine, Texas
DALLAS — Daniel Oberlender, 45, a former choir teacher at Cross Timbers Middle School in Grapevine, Texas, pleaded guilty in federal court yesterday to a criminal Information charging one count of distribution of child pornography. He faces a maximum statutory penalty of not less than five years, or more than 20 years, in federal prison, a lifetime of supervised release and a $250,000 fine. Sentencing is set for June 20, 2013, before U.S. District Judge Reed C. O’Connor. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Oberlender has been in federal custody since December 20, 2012, when he was arrested on a federal criminal complaint that was filed after law enforcement executed a search warrant at his residence in Grapevine on December 18, 2012. According to documents filed in the case, Oberlender used his Apple Macbook computer to connect to the Internet and use Skype software to share a video file depicting a minor engaged in sexually explicit conduct.
Specifically, according to the factual resume filed in the case, on August 5, 2012, Oberlender used Skype to communicate with a person known as “DJH.” During that communication, Oberlender permitted DJH to remotely view the entire contents of his computer screen. Oberlender then began playing a video file, viewable by DJH, that depicted an adult male and a minor male engaged in sexually explicit conduct. The minor male, whose eyes are shut during the entire video, appears to be approximately five or six-years-old. DJH, who was located in Dallas, used Evaer software to capture and record the contents of Oberlender’s computer screen, to include the transmission of the video.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better 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.justice.gov/psc/ For more information about internet safety education, please visit www.justice.gov/psc/ and click on the tab "resources."
The investigation is being conducted by the FBI. Assistant U.S. Attorney Aisha Saleem is in charge of the prosecution.
Former Global Wealth Management Firm Employee Arrested on Insider Trading ChargesRead the Press Release
NEWARK, N.J. – An employee of a global wealth management firm (identified only as “Brokerage Firm A”) was arrested at his home this morning on insider trading charges related to Gilead Sciences Inc.’s $11 billion acquisition of New Jersey-based Pharmasset Inc., New Jersey U.S. Attorney Paul J. Fishman announced.
Kevin Dowd, 37, of Boca Raton, Fla., is charged by criminal Complaint with conspiracy to commit securities fraud. Dowd was arrested this morning by agents of the FBI at his home, and is scheduled to appear this afternoon before U.S. Magistrate Judge William Matthewman in West Palm Beach, Fla., federal court.
According to the Complaint:Dowd was a registered representative in Brokerage Firm A’s Aventura, Fla., branch office and held the titles of second vice president and financial advisor. He joined the firm in 2005 and worked there through late October 2012. A member of Pharmasset’s board of directors was the Aventura branch’s largest customer, and informed his advisors at the Aventura branch that Pharmasset was in the process of being acquired by a large pharmaceutical company, and that the acquisition price was going to be in the high $130s per share.
At approximately 7:00 a.m. on Monday, Nov. 21, 2011, Gilead publicly announced that it had entered into an agreement with Pharmasset to acquire the company for approximately $11 billion, or $137 per share in cash. The purchase price represented an approximately 89 percent premium over Pharmasset’s closing price of $72.67 on Nov. 18, 2011. In response to the announcement, Pharmasset’s stock price increased to $134.14 per share at the close of trading on Nov. 21, 2011.
On Friday, Nov. 18, 2011, prior to the public announcement of the Pharmasset acquisition, however, Dowd tipped conspirator J.F., a childhood friend, about the impending Pharmasset acquisition. Immediately following the tip, J.F. transferred $196,000 into a brokerage account he controlled that previously had no money in it and that had not been used for months, and purchased approximately $196,000 worth of Pharmasset stock in that account. J.F. also tipped conspirator “E.B.”, who purchased 100 highly speculative “out-of-the-money” call options in Pharmasset within minutes of J.F.’s purchase of Pharmasset stock.
A few minutes after the public announcement of the Pharmasset acquisition, Dowd called J.F. several times. Later that same morning J.F. and E.B. engaged in a series of phone calls, following which they liquidated the positions in Pharmasset they had built the previous Friday. J.F. netted an illegal profit of $163,621 based on Dowd’s tip, and E.B. made an illegal profit of $544,706 from his sale of his Pharmasset options. In exchange for the tip, J.F. gave Dowd a wooden dock for his jet skis and a cashier’s check for $35,000, which was deposited into Dowd’s bank account on Jan. 5, 2012. Dowd used the money for an in-ground pool at his Boca Raton home.
When confronted by FBI agents in July 2012 about his conduct, Dowd admitted that he told J.F., but falsely stated that he had never received information that Pharmasset was going to be acquired by another pharmaceutical company.
The conspiracy count with which Dowd is charged is punishable by a maximum potential penalty of five years in prison and a fine of $250,000.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge David Velazquez in Newark, with the ongoing investigation leading to the criminal Complaint. He also thanked the U.S. Securities and Exchange Commission’s Market Abuse Unit and Philadelphia Regional Office, under the direction of Daniel M. Hawke for its assistance.The government is represented by Assistant U.S. Attorneys Gurbir S. Grewal and Mala Ahuja Harker of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
The charge and allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
13-041
Defense counsel: Peter Willis Esq., Jersey City, N.J.
Dowd Complaint
Former Education Consultant Charged with FraudRead the Press Release
BOSTON - A Los Angeles man was charged today in federal court with defrauding clients of his educational consulting firm.
Mark J. Zimny, formerly of Cambridge, was indicted on multiple counts of wire fraud and money laundering.
The Indictment alleges that Zimny operated IvyAdmit Consulting Associates, an educational consulting firm in the business of helping international applicants apply to “top” American universities and boarding schools. Zimny, who falsely claimed to be an Assistant Professor at Harvard University, told his clients that their children would improve their prospect of admission to certain schools if the clients made sizeable gifts of development contributions to the schools, through Zimny, during the application process. Zimny did not forward any of the funds collected to the schools and instead converted the funds, totaling over $600,000, for his own purposes.
The maximum penalty under the statute is up to 20 years in prison, followed by three years of supervised release and a $250,000 fine.
United States Attorney Carmen M. Ortiz and Kevin Niland, Inspector in Charge of the United States Postal Inspection Service, made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Lori Holik of Ortiz’s Economic Crimes Unit.
The details contained in the Indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former Convenience Store Owner Sentenced to Nearly Five Years in Federal Prison for Food Stamp Fraud, Wire Fraud and Conducting an Unlicensed Money Transmitting BusinessRead the Press Release
Defendant, Who Owned a Convenience Store in Arlington, Texas, Also Ordered to Pay More Than $1.4 Million in Restitution
FORT WORTH, Texas — Ali Ugas Mohamud of Arlington, Texas, was sentenced this morning by U.S. District Judge John McBryde to 13 concurrent sentences of 57 months each, following his guilty plea in October 2012 to an indictment charging him with seven counts of food stamp fraud, five counts of wire fraud and one count of conducting an unlicensed money transmitting business. In addition, Judge McBryde ordered that Mohamud pay $1,418,027 in restitution, $98,000 of which is payable immediately. 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, Mohamud owned Tawakal Grocery Store, located on South Collins Street in Arlington, and was authorized to participate in the United States Supplemental Nutrition Assistance Program (SNAP), formerly known as the “Food Stamp Program.” SNAP recipients are issued an electronic benefit card (EBT), commonly referred to in Texas as a “Lone Star Card,” in order to access SNAP benefits.
From time to time, beginning in 2009, Mohamud knowingly exchanged food stamp benefits for cash or wired money to other individuals in Somalia using food stamp benefits. As part of his scheme to defraud and to obtain money, from September 2008 through February 2010, Mohamud also wired thousands of dollars from Affiliated Computer Services, Inc., which operates EBT management for retailers, to his bank in Arlington.
The case was investigated by the U.S. Department of Agriculture - Office of Inspector General, Internal Revenue Service Criminal Investigation, the Texas Health and Human Services Commission - Office of Inspector General and the U.S. Department of Housing and Urban Development - Office of Inspector General.
Assistant U.S. Attorney J. Michael Worley was in charge of the prosecution.
Former CIA Officer Sentenced to 30 Months for Revealing Identity of 20-Plus-Year Covert CIA OfficerRead the Press Release
ALEXANDRIA, Va. — Former CIA officer John Kiriakou, 48, of Arlington, Va., was sentenced to 30 months in prison, followed by three years of supervised release, for revealing to a journalist the identity of a man whose 20-plus-year career as a covert CIA agent had never been disclosed publicly. Kiriakou also admitted in court that he disclosed information revealing the role of another CIA employee in classified activities.
Neil H. MacBride, U.S. Attorney for the Eastern District of Virginia, and Debra Evans Smith, Acting Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by United States District Judge Leonie M. Brinkema.
On Oct. 23, 2012, Kiriakou pled guilty to one count of intentionally disclosing information identifying a covert agent. As part of the plea agreement, the United States and Kiriakou agreed that a sentence of 30 months in prison was the appropriate disposition of this case.
“John Kiriakou betrayed the trust bestowed upon him by the United States and he betrayed his colleagues whose secrecy is their only safety,” said U.S. Attorney MacBride. “In his own words to the FBI, John Kiriakou called actions such as his, ‘immoral’ and the potential damage done ‘terrifying.’ John Kiriakou put the life of a covert officer at risk; he put the officer’s family in danger; and he exposed our nation’s vital secrets. Oaths matter and today’s sentence should serve as reminder to those who are entrusted with classified information that damage done by leaks is not speculative or hypothetical – it is actual and substantial, and the Justice Department will hold them accountable.”
“Mr. Kiriakou was entrusted with the important responsibility of protecting the identities of America’s covert operatives,” said Acting Assistant Director in Charge Smith. “Instead of protecting this classified information, he revealed it, thereby threatening their personal safety as well as our nation’s security. Together with our intelligence community partners, the FBI will continue to investigate those who violate this special trust.”
According to court records, the case is a result of an investigation triggered by a classified filing in January 2009 by defense counsel for high-value detainees at Guantanamo Bay, Cuba. This filing contained classified information the defense had not been given through official government channels, including information about certain government employees and contractors. The investigation revealed that on multiple occasions one of the journalists to whom Kiriakou illegally disclosed classified information, in turn, disclosed that information to a defense team investigator. This information was reflected in the classified defense filing and enabled the defense team to take or obtain surveillance photographs of government personnel. The investigation concluded that no laws were broken by the defense team.
Kiriakou was a CIA intelligence officer between 1990 and 2004, serving at headquarters and in various classified overseas assignments. Upon joining the CIA in 1990 and on multiple occasions in following years, Kiriakou signed secrecy and non-disclosure agreements not to disclose classified information to unauthorized individuals. In a statement of facts filed with his plea agreement, Kiriakou admitted that he made illegal disclosures about two CIA employees and their involvement in classified operations to two journalists (referenced as “Journalist A” and “Journalist B” in court records) on multiple occasions between 2007 and 2009.
Court records indicate that the emails seized during the investigation revealed that Kiriakou disclosed information to journalists about dozens of CIA officers, including numerous covert officers of the National Clandestine Service beyond the one identified in the defense filing by lawyers for the high-value detainees in Guantanamo Bay. The government raised this with the court to demonstrate that the charged conduct was in no sense aberrational or reflective of an atypical lapse of judgment.
Kiriakou admitted that, through a series of emails with Journalist A, he disclosed the full name of a CIA officer (referred to as “Covert Officer A” in court records) whose association with the CIA had been classified for more than two decades. In addition to identifying the officer for the journalist, Kiriakou also provided information to the journalist that linked the officer to a CIA counterterrorism program known as the Rendition, Detention, and Interrogation Program and a particular RDI operation.
In addition, Kiriakou admitted that he disclosed to Journalists A and B the name and contact information of a CIA officer, identified in court records as “Officer B,” along with his association with an operation to capture terrorism subject Abu Zubaydah in 2002. Kiriakou knew that the association of Officer B with the Abu Zubaydah operation was classified. Based in part on this information, Journalist B subsequently published a June 2008 front-page story in The New York Times disclosing Officer B’s alleged role in the Abu Zubaydah operation.
Kiriakou provided this information to journalists without inquiring what the journalists would do with the information. Without Kiriakou’s knowledge, Journalist A passed the information he obtained from Kiriakou to an investigator assisting in the defense of high-value detainees at Guantanamo Bay. The investigator had been unable to successfully identify either officer until he received this information from Journalist A, which led to Officer B being secretly photographed and his photographs being tendered to high-value terrorist detainees – a result Kiriakou himself described as “terrifying.”
Kiriakou also admitted that he lied to the CIA regarding the existence and use of a classified technique, referred to as a “magic box,” while seeking permission from the CIA’s Publications Review Board to include the classified technique in a book.
This case was investigated by the FBI’s Washington Field Office, with assistance from the Central Intelligence Agency and the Air Force Office of Special Investigations. Assistant U.S. Attorneys Iris Lan of the Southern District of New York, Mark E. Schneider and Ryan Fayhee of the Northern District of Illinois, and W. Neil Hammerstrom, Jr. of the Eastern District of Virginia are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Former Bank Director Charged with Securities and Wire FraudRead the Press Release
A former director of a Georgia bank who managed two private investment funds has been charged by a federal grand jury in the Eastern District of New York with securities fraud and wire fraud. According to court documents, defendant Aubrey Lee Price sent a letter to acquaintances in mid-June 2012 in which he admitted that he had lost a large amount of investor money through trading activities and that he planned to kill himself by jumping from a ferry boat in Florida. Price remains missing. Anyone with information regarding Price’s whereabouts or the alleged crime is urged to contact the Federal Bureau of Investigation office in New York at (212) 384-1000, or at [email protected].
The charges were announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation (FBI), New York Field Office.
According to the indictment, Price managed investment funds PFG LLC (“PFG”) and the Montgomery Growth Fund (“Montgomery Growth”). Starting in or about June 2009, PFG raised approximately $40 million from approximately 115 investors from across the nation. Price unsuccessfully invested PFG funds in various equity securities, options, and real estate, including farms in South America. To cover up his losses, Price allegedly lied to his investors by posting fake account statements on a secure PFG web site that fraudulently reflected fictitious assets and fabricated investment returns.
The indictment also states that, starting in or about January 2011, Price became a director of Montgomery Bank & Trust (“MB&T”), a financial institution in Ailey, Georgia. Price also invested some of the bank’s capital, which he told the bank’s management he would invest safely in U.S. Treasury securities. Instead, Price lost much of the bank’s money through risky investments in equity securities and options. Price also embezzled MB&T money to pay redemptions to some PFG investors. The indictment charges that Price covered up his embezzlement and losses of MB&T’s funds by giving the bank’s management fabricated documents falsely indicating that approximately $17 million was on deposit in the bank’s name at a large financial services firm in New York.
“As charged in the indictment, this defendant repeatedly abused the trust placed in him by his investors and MB&T by lying about his investment losses, fabricating documents, and embezzling bank funds. Through this web of deception, Price acted to create the image of a successful investor. When that image was shown to be a lie, he then orchestrated his confession and disappearance. We are using every resource available to locate him and recover the funds he stole,” said U.S. Attorney Lynch.
FBI Assistant Director-in-Charge Venizelos stated, “As alleged, Price lied to investors about where their money would be invested, and lied to them about the solvency of his company. He lied to the bank on whose board he served about investment of bank capital, and lied again to cover up that lie. It is therefore reasonable to assume that Price’s talk of suicide was also a lie. The FBI is actively looking for Aubrey Lee Price.”
The charges in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, the defendant faces a maximum prison sentence of 30 years for wire fraud and 25 years for securities fraud.
The government’s case is being prosecuted by Assistant United States Attorneys David C. Woll, Jr., James McMahon, and Brian Morris.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency task force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
The Defendant:
Name: AUBREY LEE PRICE
Age: 46Financial Consultant Extradited to the United States for Alleged Scheme to Defraud the U.S. Export-import BankRead the Press Release
Manuel Ernesto Ortiz-Barraza, an independent financial consultant, was extradited to the United States today for his alleged role in a scheme to defraud the Export-Import Bank of the United States (Ex-Im Bank) of over $2.5 million, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the Western District of Texas Robert Pitman and Osvaldo L. Gratacos, Inspector General of the Ex-Im Bank.
Ortiz-Barraza, 56, was charged in an indictment unsealed on Oct. 19, 2011, in the Western District of Texas with one count of conspiracy to commit wire and bank fraud, three counts of wire fraud and one count of bank fraud for his alleged role in a scheme with several others to defraud the Ex-Im Bank. Based on a provisional arrest warrant, Mexican authorities arrested Ortiz-Barraza in Mexico on Feb. 13, 2012, and he has been awaiting extradition to the United States, a process which was recently finalized by the Mexican courts.
According to the U.S. indictment and court documents, Ortiz-Barraza and his co-conspirators allegedly conspired to obtain Ex-Im Bank guaranteed loans through banks by creating false loan applications, false financial statements and other documents purportedly for the purchase and export of U.S. goods into Mexico. Ortiz-Barraza and his co-conspirators allegedly falsified shipping records to support their claims of doing legitimate business and did not ship the goods that were guaranteed by the Ex-Im Bank. After the loan proceeds were received, Ortiz-Barraza and his co-conspirators allegedly split the loan proceeds among themselves. As a result of the alleged fraud, the conspirators’ loans defaulted, causing the Ex-Im Bank to pay claims to lending banks on a loss of over $2.5 million.
The charges and allegations contained in the indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.
The Ex-Im Bank is an independent federal agency that helps create and maintain U.S. jobs by filling gaps in private export financing. The Ex-Im Bank provides a variety of financing mechanisms to help foreign buyers purchase U.S. goods and services.
The case is being prosecuted by Senior Litigation Counsel Patrick Donley and Trial Attorney William Bowne of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Steven Spitzer of the Western District of Texas, El Paso Division. The case was investigated by the Ex-Im Bank Office of Inspector General, Homeland Security Investigations in El Paso, under the leadership of Acting Special Agent in Charge Dennis Ulrich; Internal Revenue Service-Criminal Investigation in Washington, D.C., under the leadership of Special Agent in Charge Rick A. Raven; and the U.S. Postal Inspection Service in Washington, D.C., under the leadership of Inspector in Charge Daniel S. Cortez. Substantial assistance was provided by the U.S. Marshals Service and the Criminal Division’s Office of International Affairs in Washington, D.C. The Department of Justice is particularly grateful to the government of Mexico for their assistance in this matter.
Federal Jury Convicts Fort Worth Man in Methamphetamine Trafficking ConspiracyRead the Press Release
FORT WORTH, Texas — Following an afternoon of testimony before U.S. District Judge John McBryde, and five hours of deliberation, a federal jury convicted Josue Martinez-Garcia, aka “Cholo,” of conspiring to possess with the intent to distribute more than 500 grams of methamphetamine. Martinez-Garcia, 29, of Fort Worth, Texas, faces a statutory sentence of not less than 10 years and up to life in federal prison and a $10 million fine. Sentencing is set for May 10, 2013. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
The government presented evidence at trial that beginning at least in 2010, Martinez-Garcia conspired to distribute more than 500 grams of methamphetamine The government’s case consisted of numerous witnesses, including two cooperators who had distributed for Martinez-Garcia and an undercover agent who had negotiated with Martinez-Garcia to purchase two kilograms of methamphetamine.
Co-defendant in the case, Jacob Fenton, aka “Solo,” 29, also of Fort Worth, who testified at trial, pleaded guilty in October 2012 to one count of conspiracy to distribute and possess with the intent to distribute methamphetamine, and faces a statutory sentence of up to 20 years in federal prison and a $1 million fine. Sentencing is set for February 1, 2013.
The case was investigated by the Drug Enforcement Administration and prosecuted by Assistant U.S. Attorneys Matt Gulde and Aisha Saleem.
Federal Grand Jury in Fort Wayne Returns IndictmentRead the Press Release
Fort Wayne, INCThe United States Attorney's Office announced that a Grand Jury sitting in Fort Wayne, Indiana, returned the following Indictment on January 23, 2013:
Sheila Robinson, 48, of Fort Wayne, Indiana, is charged in a ten count Indictment with wire fraud on or about February 13, 2012, February 15, 2012, and August 6, 2012; mail fraud on or about July 27, 2012, making a false claim on or about February 13, 2012, February 15, 2012, and August 6, 2012, and aggravated identity theft on or about February 13, 2012, February 15, 2012, and August 6, 2012. These charges were filed as the result of an investigation by the Internal Revenue Service and United States Postal Inspection Service. This case has been assigned to and will be prosecuted by Assistant United States Attorney Lovita Morris King and Deborah M. Leonard.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
##END##Fairbanks Man sentenced to three years for drug cultivationRead the Press Release
Fairbanks, Alaska -U.S. Attorney Karen L. Loeffler announced today that a Fairbanks man was sentenced in federal court in Fairbanks for two counts of drug trafficking.
Johnathon Butterfield, 23, of Fairbanks, Alaska, also recently of Tucson, Arizona, was sentenced by Chief United States District Court Judge Ralph R. Beistline to 37 months in prison, to be followed by four years of supervised release.
According to Assistant U.S. Attorney Stephen Cooper, who prosecuted the case, Butterfield was one of several persons involved in a cooperative venture to manufacture marijuana and to possess the drug with intent to distribute. Butterfield pled guilty to conspiracy and also to one count of manufacturing the drug.
In entering the sentence, Judge Beistline found that Butterfield had participated in cultivating more than five hundred marijuana plants in order to produce the marijuana intended for sale. The court also found that he had possessed hand guns and ammunition in connection with his commercial operation.
Ms. Loeffler commends the Drug Enforcement Administration and the Alaska Statewide Drug Enforcement Unit for the investigation of this case.
Fairbanks Man sentenced to ten years for drug cultivationRead the Press Release
Fairbanks, Alaska- U.S. Attorney Karen L. Loeffler announced today that a Fairbanks man was sentenced in federal court in Fairbanks on January 24, 2013, for three counts of drug trafficking and one count of possessing a firearm in furtherance of the drug trafficking crimes.
Floyd Everett Harshman, 54, of Fairbanks, Alaska, was sentenced by Chief United States District Court Judge Ralph R. Beistline to 120 months in prison, to be followed by five years of supervised release.
According to Assistant U.S. Attorney Stephen Cooper, Harshman supervised several persons in a cooperative venture to manufacture marijuana and to possess with intent to distribute. Harshman pled guilty to conspiracy and two counts of manufacturing the drug at different locations in the Fairbanks area, and also to one count of possessing a firearm in furtherance of the drug trafficking crimes.
In entering the sentence, Judge Beistline found that Harshman had supervised the cultivation of more than one thousand marijuana plants in order to produce the marijuana intended for sale. The court also found that he had possessed hand guns and ammunition in connection with his commercial operation.
Ms. Loeffler commends the Drug Enforcement Administration and the Alaska Statewide Drug Enforcement Unit for the investigation of this case.
El Paso Man Sentenced to Federal Prison on Sexual Exploitation ChargesRead the Press Release
United States Attorney Robert Pitman and FBI Special Agent in Charge Mark Morgan announced that in El Paso this morning, 47-year-old Joe Tapia, III, of El Paso, was sentenced to the statutory maximum of 30 years in federal prison followed by a lifetime of supervised release after pleading guilty in October to solicitation of material relating to the sexual exploitation of children.
By pleading guilty, the former Excel Learning Center (ELC) admissions service representative and local church youth minister admitted that he had sexually explicit instant messenger chats with multiple minors on both his work and home computers. Furthermore, Tapia admitted that he recorded video and still images of two children while they were changing clothes prior to a church performance and used those recordings to solicit other sexually explicit images of children.
Tapia has remained in custody since his arrest by special agents with the Federal Bureau of Investigation in May 2012.
This case was investigated by the Federal Bureau of Investigation together with the El Paso Police Department. Assistant United States Attorney J. Brandy Gardes prosecuted this case on behalf of the Government.
East Moriches Man to Be Arraigned Today on Charge of Child Pornography PossessionRead the Press Release
Federal agents and investigators with the Suffolk County Police Department’s Computer Crimes Squad arrested an East Moriches man this morning on the charge of possessing child pornography. The defendant, Jay Lockett Sears, is scheduled to be arraigned later today before United States District Magistrate Arlene R. Lindsay at the U.S. Courthouse, 100 Federal Plaza, Central Islip, New York.1
The arrest was announced by Loretta E. Lynch, United States Attorney for the Eastern District of New York, George Venizelos, Assistant Director-in-Charge of the Federal Bureau of Investigation, (“FBI”) New York Field Office, and Edward Webber, Commissioner, Suffolk County Police Department (“SCPD”).
According to court filings, which include an application for a search warrant of the defendant’s East Moriches apartment, Sears created hundreds of images of child pornography by taking photographs of children in public settings, and then cutting and pasting the heads of the children onto images of adult bodies engaged in sexual activity. Some images included those in which Sears allegedly pasted his own facial images onto the bodies of other males so as to appear as if he were having sexual relations with children.
Sears came to the attention of the SCPD on January 11, 2013, after the discovery of numerous bags containing hundreds of child pornography images were found in trash removed from the defendant’s apartment. The images were discarded apparently in anticipation of Sears vacating his apartment.
“As alleged, Sears victimized countless children by using their innocent images to create child pornography. He then went so far as to use his own image to virtually join in the exploited scenarios he created. The sexual exploitation of children is one of our most important law enforcement priorities. Those who seek to harm children will be arrested and prosecuted,” stated United States Attorney Lynch.
Assistant Director-in-Charge Venizelos stated, “The altering of children’s photos to create child pornography victimizes those children to provide merchandise for a depraved market. We have an obligation and a commitment to protect children from exploitation.”
“Children are our most precious and vulnerable resource,” said Suffolk County Police Department Commissioner Webber. “Protecting children in our community is a high priority for our police department, and we will continue to work with other law enforcement agencies, as well as community leaders, to ensure their safety.”
If convicted, the defendant faces a maximum sentence of 10 years’ imprisonment.
Parents who believe that their children may have been the victims of persons involved in child pornography should contact the Suffolk County Computer Crimes Squad at (631) 852-6279, or the Federal Bureau of Investigation at (631) 501-8600.
The government’s case is being prosecuted by Assistant United States Attorneys Allen Bode and Thomas Sullivan.
The Defendant:
Name: JAY LOCKETT SEARS
Age: 73_____________________________
1 The charge is merely an allegation, and the defendant is presumed innocent unless and until proven guilty.
District Man Sentenced to Six Years in Prison for Obstructing Justice in Investigation of 2011 Murder-Defendant Admits Making False Statements to A Grand Jury-Read the Press Release
WASHINGTON – Jefferson Joseph, 23, of Washington, D.C., was sentenced today to six years and one month in prison after earlier pleading guilty to charges of obstructing justice in a criminal investigation and unlawful entry, U.S. Attorney Ronald C. Machen Jr. announced.
Joseph pled guilty in August 2012 in the Superior Court of the District of Columbia and was sentenced today by the Honorable Ronna L. Beck.
According to the government’s evidence, Joseph obstructed justice in the investigation into the murder of Jeffrey Covington, 19, who was killed early July 2, 2011 in the 600 block of 46th Place SE. Mr. Covington was shot once in the neck, and the entire murder was captured on video surveillance footage. The government has charged William Faison, 23, with first-degree murder while armed and other offenses in the murder. Mr. Covington’s father, Jeffrey Blount, 42, is charged with obstructing justice, carrying a pistol without a license, and other offenses.
On the video, several individuals can be seen in the area during a craps game. An individual, alleged to be Faison, walked up to Mr. Covington and Blount. The man pushed Mr. Covington and Blount out of the way, pulled out a handgun, and announced a robbery. Blount then began to flee, with the gunman in pursuit. During the chase, Mr. Covington appeared to pull out a handgun, which was broken, and pointed it in the direction of the gunman, apparently to defend his father. The gunman then turned toward Mr. Covington and shot and killed him.
Joseph was among the individuals who would have been in a position to identify the gunman. Joseph can be seen walking to the craps game and backing up as the gunman approached Blount to rob him, and then watching a portion of the shooting before fleeing.
A grand jury investigation commenced shortly after the homicide. Joseph was subpoenaed, and eventually testified twice. In his plea, Joseph acknowledged that he had made numerous false statements to the grand jury in an effort to obstruct the investigation into the murder, including conflicting statements about his sobriety that evening, denying his knowledge of other individuals present for the murder, and conflicting accounts about the nature of his relationship with Faison. He also denied remembering what happened on the night of the murder.
The unlawful entry charge stems from a previously issued Court order that barred Joseph from the area where the murder took place.
Faison and Blount are scheduled to stand trial in July 2013, and both men have pled not guilty to the charges.
In announcing the sentence, U.S. Attorney Machen commended the work of the Metropolitan Police Department’s Violent Crimes Branch. He also praised the work of Paralegal Specialist Fern Rhedrick and thanked Assistant U.S. Attorneys Melinda Williams and Jeff Pearlman, who have been investigating the case.
13-027District Man Sentenced to 18 Months in Prison for Assaulting Another Man Inside Metro Station– Victim Fell onto the Track at L’Enfant Plaza Metro Station–Read the Press Release
WASHINGTON - Roderick Hill, also known as Rodrick Delvon Hill, 22, of Washington, D.C., was sentenced today to 18 months in prison for assaulting another man last year inside the L’Enfant Plaza Metro station, announced U.S. Attorney Ronald C. Machen Jr.
Hill pled guilty in September 2012 in the Superior Court of the District of Columbia to a charge of assault with significant bodily injury. He was sentenced by the Honorable Heidi M. Pasichow. Following his prison term, Hill will be placed on three years of supervised release.
This was the second sentencing for Hill this week. On Jan. 23, 2013, he was sentenced in the U.S. District Court for the District of Columbia to a 20-month prison term for assaulting a Deputy United States Marshal. Hill struck the deputy marshal with a closed fist numerous times in the face and head area while he was in Superior Court for a hearing in June 2012 in the case involving the assault at the Metro station.
The attack at the L’Enfant Plaza Metro station took place at about 9:10 p.m. on June 3, 2012. Hill struck a man with a closed fist. The blow was with such force that it caused the victim to fall from the platform onto the train track, causing him to lose consciousness momentarily. Other bystanders helped the victim get back onto the platform. Hill left the scene, but the police canvassed the area and later found him inside the Minnesota Avenue Metro station. The victim was transported to the hospital that evening for immediate medical care. As a result of the assault, the victim suffered a broken jaw and had to wear a wire for four weeks.
Judge Pasichow ordered that Hill’s sentence be run consecutively to the sentence in the federal court matter, meaning that Hill now faces a total of 38 months of incarceration.
In announcing today’s sentence, U.S. Attorney Machen praised the work of the Metro Transit Department, which investigated the case. He also commended the efforts of Assistant U.S. Attorneys Emory V. Cole and John C. Truong, who investigated and prosecuted the case.
13-025District Man Charged with Series of Car Loan Scams That Cheated Victims Out of More Than $185,000- Accused of Posing as Car Dealer to Deceive Unsuspecting Victims -Read the Press Release
WASHINGTON -- Benjamin Grey, 32, of Washington, D.C., was indicted today on federal charges in connection with a scheme in which he posed as a car dealer to defraud individuals and banks of more than $185,000, announced U.S. Attorney Ronald C. Machen Jr., David Beach, Special Agent in Charge of the Washington Field Office of the U.S. Secret Service, and Cathy L. Lanier, Chief of the Metropolitan Police Department (MPD).
Grey was indicted by a grand jury in the U.S. District Court for the District of Columbia. The 23-count indictment includes charges of bank fraud, wire fraud and other offenses. It also includes a forfeiture allegation seeking all proceeds that can be traced to the scheme. Grey has been in custody since his arrest on Aug. 22, 2012.
According to the indictment, Grey claimed that he ran car dealerships named Planet Cars and GreyMaxx. Grey persuaded various individuals to apply for car loans purporting to buy luxury cars, such as BMWs, from him and Planet Cars. After the bank or credit union issued a loan and check to buy the car, Grey took the money but never produced the promised car, and avoided contact with the victim. The indictment alleges Grey never owned the cars in question.
The indictment alleges that on five separate occasions in 2009, including four times in October 2009, Grey fraudulently obtained auto loan checks in this way. Each loan was between $29,000 and $35,000. The victimized banks included BB&T and Navy Federal Credit Union. All told, these loans were worth more than $160,000.
In addition, according to the indictment, Grey executed other similar confidence schemes. For example, in April 2010, Grey – holding himself out as the owner of Planet Cars – obtained a car from a legitimate car dealership in Bethesda, Md., using a worthless check drawn on a Planet Cars bank account that had been closed for a year. Further, the indictment alleges that in 2010, Grey defrauded a would-be business partner out of at least $26,000 by pretending that the money would finance their purchase and re-sale of luxury cars. Finally, the indictment alleges that in 2012 Grey sought a payment of thousands of dollars to obtain a Range Rover for an undercover Special Agent with the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives - but, again, Grey had no intention of providing the car.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
In announcing the charges, U.S. Attorney Machen, Special Agent in Charge Beach and Chief Lanier commended the efforts of those who worked on the case from the U.S. Secret Service and MPD, as well as those who provided assistance from the Bureau of Alcohol Tobacco, Firearms and Explosives. They also commended the work of Assistant U.S. Attorneys Jonathan Hooks and Christopher R. Kavanaugh, who are prosecuting the case.
13-026Delaware Man Pleads Guilty to Extortion, Computer IntrusionRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS – Donald Christopher Dailey, 37, of Delaware, Ohio pleaded guilty in U.S. District Court today to extortion for demanding money from the company where he was the information technology administrator in exchange for not disclosing internal financial and other information. Dailey also admitted to “hacking” into an ex-girlfriend’s email account.
Carter M. Stewart, United States Attorney for the Southern District of Ohio and Edward J. Hanko, Special Agent in Charge, Federal Bureau of Investigation (FBI) announced the guilty pleas entered today before U.S. District Judge Michael Watson.
According to court documents, Dailey abruptly resigned from the engineering company where he worked on October 1, 2012. Employees found a laptop connected to the company network and streaming live email of the company’s CEO. It was hidden in Dailey’s private and secure workroom. In a resignation letter he sent to the CEO, Dailey claimed he had knowledge of what he alleged was damaging financial and other information regarding internal company communications that he would disclose to authorities and certain customers unless the CEO and his business partner sat down and talked with him.
On October 13, Dailey called the CEO and made an opening demand of 75 percent of the $92,500 expected salary if he had stayed with the company. FBI agents arrested Dailey on October 16 and searched his residence. An analysis of Dailey’s computer revealed that he had gathered personal information about the company’s employees including everyone’s name and salary, and had stored the data on his personal computer. The alleged documents or information referenced by Dailey as part of the extortion were not found.
Dailey also admitted illegally accessing an ex-girlfriend’s email and bank accounts from a computer at the engineering company where he worked before he resigned.
Dailey remains on house arrest pending sentencing on a date to be set by Judge Watson. Extortion is punishable by up to two years in prison and a fine of $250,000. Intentionally accessing a computer without authorization is punishable by up to one year in prison.
U.S. Attorney Stewart commended the FBI agents who investigated the case and Assistant U.S. Attorney Deborah A. Solove, who represented the United States in the case.
Collinsville Man Sentenced to Prison for Possession of Stolen Firearm and Possession of Firearm by User of MarijuanaRead the Press Release
A Collinsville, Illinois, man was sentenced today to a prison term by the federal district court for possession of a stolen firearm and possession of a firearm by a user of marijuana, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced.
Michael C. Campbell, 54, was sentenced to 24 months in prison to be followed by 3 years of supervised release, a $200 special assessment, and a fine of $7500, following his plea of guilty, on June 12, 2012, to an Indictment charging him with Possession of a Stolen Firearm, and Possession of a Firearm by a User of Marijuana. The charges relate to an incident that occurred on December 21, 2011, in Collinsville, Illinois, when investigating agents of the Bureau of Alcohol, Tobacco, Firearms, and Explosives learned that Campbell had purchased a stolen firearm from Jason Simmons, who pled guilty to similar charges on May 31, 2012. Documents filed with the Court indicate that Simmons received over 90 stolen firearms from a person in Missouri who had given the guns to Simmons for storage. Simmons sold one of the stolen firearms to Campbell, who knew that it had been stolen. Campbell also admitted to being a daily user of marijuana.
Simmons was sentenced last December, to 46 months in prison to be followed by three years of supervised release, a $300 special assessment, and a $750 fine.
The case was investigated by members of the Bureau of Alcohol, Tobacco, Firearms, and Explosives. The case was prosecuted by Assistant U.S. Attorney Stephen B. Clark.
Chinese Business Owner, Employee Plead Guilty, Sentenced for Stealing Trade Secrets from Sedalia PlantRead the Press Release
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Chinese business owner and his employee pleaded guilty and were sentenced in federal court today for conspiring to steal trade secrets from Pittsburgh Corning Corporation, which has a manufacturing plant in Sedalia, Mo., that produces FOAMGLAS® insulation.
“These defendants intended to inflict significant economic harm on an American corporation for their own illicit profit,” Dickinson said. “Theft of trade secrets from U.S. companies by foreign businesses is a national concern. Such thefts can cripple U.S. companies in the marketplace and cost the jobs of workers in the United States. Well-heeled business owners like Huang are put on notice that theft from U.S. companies will be prosecuted and will be punished.”
Ji Li Huang, 46, and Xiao Guang Qi, 32, both citizens of China, pleaded guilty before U.S. District Judge Brian C. Wimes to participating in a conspiracy to steal trade secrets. Huang is the CEO of Ningbo Oriental Crafts Ltd., which employs 200 factory workers to manufacture promotional products for export to the United States and Europe. Qi was his employee.
Huang was sentenced to 18 months in federal prison without parole and ordered to pay a fine of $250,000. Qi was sentenced to time served and ordered to pay a fine of $20,000. Both of the fines were paid today.
“A crime of this nature provides an unfair advantage to competing industries based solely upon an individual, a company or a foreign power’s ability to cheat and steal proprietary information,” stated Michael Kaste, Special Agent in Charge of the Kansas City Division of the FBI. “This results in a significant impact to the economy, a devastating result to the businesses targeted and a threat to the economic security of the United States.”
Pittsburgh Corning, headquartered in Pittsburgh, Penn., manufactures various grades or densities of cellular glass insulation sold under the trade name FOAMGLAS®. That material is used to insulate buildings, industrial piping systems and liquefied natural gas storage tank bases. Pittsburgh Corning’s customers include energy companies, petro chemical companies, and natural gas facilities. Pittsburgh Corning considers the product formula and manufacturing process for FOAMGLAS® proprietary and trade secrets.
By pleading guilty today, Huang and Qi admitted that they attempted to illegally purchase trade secrets of Pittsburgh Corning for the purpose of opening a plant in China to compete with Pittsburgh Corning.
Under the federal sentencing guidelines, Huang and Qi are held accountable for any reasonably foreseeable loss that would have resulted from their crime. The court ruled that the intended loss to Pittsburgh Corning exceeded $7 million, based on the company’s investment of time and resources to research, develop and protect the proprietary information the defendants attempted to steal.
Huang and Qi were arrested when they met with an individual they believed to be an employee of Pittsburgh Corning who had stolen documents that contained trade secret information and was willing to sell it to them for $100,000. That employee, however, was cooperating with law enforcement and the meetings in Kansas City were a sting operation that led to their arrests on Sept. 2, 2012.
On July 22, 2012, an advertisement was published in the local newspaper that solicited “technical talent” with experience at Corning Pittsburgh to lead a project to build a foam glass factory in the Asian market. A confidential source – working with the FBI – responded to the contact e-mail address cited in the newspaper advertisement. While in the United States for business, Huang met with the cooperating source. They agreed that $25,000 would be exchanged upfront (with $75,000 to follow later) for a package of Pittsburgh Corning’s processes and formulary on FOAMGLAS®. They also discussed paying the cooperating source to travel to China several times for consulting.
On Sept. 1, 2012, the cooperating source met with Huang and Qi at a Kansas City restaurant. Qi participated in the meeting and also acted as a translator for Huang for parts of the conversation. A follow-up meeting was scheduled for the next day, at which the cooperating source would bring the stolen proprietary information and Huang and Qi would bring the payment. The cooperating source told Huang and Qi that he had to drive back to Pittsburgh Corning and break into the engineering department to steal the documents and drawings for the equipment.
The next day, Huang and Qi met the cooperating source at a prearranged location and brought a bag containing the money. The cooperating source showed them documents that were purportedly Pittsburgh Corning’s trade secret information, some of which were stamped with secret and confidential markings. Shortly afterward, FBI agents arrested Huang and Qi at their hotel room.
The court ordered Huang and Qi to forfeit to the government $29,778 that was seized by law enforcement officers at the time of their arrest, which the defendants had brought to the United States in order to illegally purchase trade secrets.
This case was prosecuted by Assistant U.S. Attorneys Brian Casey and Matt Wolesky. It was investigated by the FBI.
Charleston Man Sentenced to Five Years in Prison for Selling Crack CocaineRead the Press Release
Defendant Listed Among Charleston’s West Side DMI Offenders
CHARLESTON, W.Va. – U.S. Attorney Booth Goodwin today announced that a Charleston man was sentenced to five years in prison for distributing crack cocaine. Fred Taylor, 23, of Charleston, admitted that on December 1, 2010, he sold a quantity of crack cocaine to a confidential informant working for the Metropolitan Drug Enforcement Network Team (MDENT). Taylor further admitted that on December 7, 2010, he sold crack cocaine to an informant working for MDENT. Both illegal drug transactions took place in Charleston.
On December 22, 2010, MDENT officers executed a search warrant at an apartment shared by the defendant and his associate located on Hutchinson Street in Charleston. Officers located and seized a quantity of crack cocaine, two sets of scales and approximately $2,474 cash.
The Metropolitan Drug Enforcement Network Team (MDENT) conducted the investigation. Assistant United States Attorney Joshua Hanks handed the prosecution. The sentence was imposed by United States District Judge John T. Copenhaver, Jr.
This case was prosecuted as part of the Charleston area’s Drug Market Intervention (DMI) initiative. The DMI initiative was launched in February 2012 by Charleston Police Chief Brent Webster and U.S. Attorney Booth Goodwin, in collaboration with Kanawha County Prosecuting Attorney Mark Plants, other federal, state, local law enforcement agencies and leaders representing several West Side community development organizations. The DMI initiative was initiated in Charleston as a strategic problem-solving effort aimed at closing down open-air drug markets that breed crimes of violence and disorder.
Cahokia Woman Sentenced on Social Security Fraud ChargeRead the Press Release
Jacqueline L. Burrell, 45, of Cahokia, was sentenced today in the U.S. District Court in East St. Louis for concealing a material fact from the Social Security Administration (SSA), the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced. Burrell received a sentence of 10 months in prison to be followed by three years of supervised release. The court also ordered Burrell to pay $53,992 restitution to SSA and a special assessment of $100.
At her guilty plea on October 3, 2012, Burrell admitted that she fraudulently applied for and received assistance for her children in her custody in the form of Supplemental Security Income Benefits payments. During these times, however, she did not actually have custody of the children, who were with their father in California. Burrell, while acting as Representative Payee for her minor children, failed to disclose and concealed the fact that the children no longer resided with her in order to receive payments intended to benefit the children.
The investigation was conducted by the Social Security Administration’s Office of Inspector General and was prosecuted by Assistant United States Attorney Liam Coonan.
If you suspect or know of an individual or company that is committing fraud against any Social Security Administration (SSA), you may report this to the SSA Office of Inspector General by calling 800.269.0271.
Blackfoot Man Pleads Guilty to ArsonRead the Press Release
POCATELLO –Trevor James Hurley, 20, of Blackfoot, Idaho, pleaded guilty yesterday in United States District Court in Pocatello to arson, U.S. Attorney Wendy J. Olson announced.
According to the plea agreement, in the early morning hours of August 6, 2012, Hurley set fire to a manufactured home or trailer located on the Fort Hall Shoshone Bannock Indian Reservation. Witnesses observed Hurley earlier in the night purchasing cotton balls and lighter fluid at a convenience store. Hurley later returned to the convenience store, bragging about how he had set someone's trailer on fire. In an interview with law enforcement on September 11, 2012, Hurley explained how he poured lighter fluid on the cotton balls, lit them on fire, and pushed them through a hole in the screen to the trailer's master bedroom window. He said that the trailer ignited fast, flames shot up, and then he ran back to his friends in a nearby vehicle. Although the trailer was a total loss, and another person was sleeping in a camp trailer located approximately ten feet away, no one was injured in the fire.
The charge is punishable by up to 25 years in prison, a maximum fine of $250,000, and up to five years of supervised release.
Sentencing is set for April 30, 2013, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
The case was investigated by the Fort Hall Police Department, Idaho State Fire Marshal, and the Bingham County Sheriff's Office.
Belleville Man Sentenced for Defrauding Federal Unemployment Insurance ProgramRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced that Kevin Veath, 54, of Belleville, Illinois, was sentenced today in the United States District Court for defrauding the unemployment insurance program. Following his plea of guilty on October 3, 2012, to a one-count indictment for Embezzlement of Public Funds, the District Court sentenced Veath to a 5 year term of probation. He also was ordered to repay approximately $15,245 in restitution to the Office of the Illinois Attorney General and to pay a $100 special assessment.
“Everyone should know that lying and cheating to receive unemployment compensation is a crime.” said United States Attorney Wigginton. “Those who defraud the unemployment insurance program undermine support for an important public program and hurt and insult every law-abiding citizen of Southern Illinois, particularly as public programs face economic crises. I will continue to place a high priority on pursuing those who steal from the United States Treasury.”
At the time of his guilty plea, Veath admitted to being employed between February 2009 and September 2009 while also filing for and receiving unemployment insurance benefits. In order to receive the benefits, Veath had to certify, approximately every two weeks, to the Illinois Department of Employment Security (IDES) that he was not working and that he was ready, willing, and able to work. He also had to verify that he was actively seeking work. Veath was supposed to inform IDES of any income he received during the certification period, but he did not report that he was employed and earning money, instead choosing to collect both wages and benefits simultaneously. Between February and September of 2009, Veath collected $16,645 in employment insurance benefits to which he was not entitled; however, Veath began repaying the money he stole before sentencing, resulting in the lower restitution order.
This case was investigated by the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; the United States Postal Inspection Service; and the Illinois Department of Employment Security. This case was prosecuted by Special Assistant United States Attorney Katherine L. Lewis.
Bank Robbery Suspect ChargedRead the Press Release
US Attorney Brendan V. Johnson announced that a suspect has been charged by complaint in U.S. District Court for robbing the First Bank and Trust in Toronto, South Dakota on January 2, 2013.
Nathan Michael Reisetter, age 38, of White, South Dakota made his first court appearance before US Magistrate Judge William D. Gerdes on January 23, 2013. The maximum penalty upon conviction for bank robbery is 20 years in prison and/or a $250,000 fine, plus restitution. The charge is merely an accusation and Reisetter is presumed innocent until and unless proven guilty.
Investigation indicates that a man entered the First Bank and Trust at about 3:45 p.m. on January 2, 2013, carrying a large handgun and two garbage bags and wearing a black snowmobile helmet liner or mask over his head and face. The man gave a garbage bag to a teller and told her to fill it up with money from the vault. The man forced two tellers to a back room of the bank and told them to stay there until they counted to one hundred.
As soon as they heard the bank’s door close, the tellers went to the bank’s windows and saw the robber drive away in a red SUV that one of the tellers had noticed park across the street just before the robbery. Footprints and tire tread prints in the snow found around the parking spot were photographed and a plaster cast was made of the tire tread prints.
Investigation led law enforcement to Reisetter’s vehicle, which is a red SUV and has tires that matched the tire tread prints made in the snow outside the bank.
On January 22, law enforcement interviewed Reisetter. He admitted robbing the bank and disclosed that evidence of the crime and some of the stolen money were at his home. Police searched Reisetter’s home and seized cash, guns, and the clothing worn by Reisetter the day he robbed the bank.
The investigation is being conducted by the Deuel County Sheriff’s Office, the SD Division of Criminal Investigation, and the Federal Bureau of Investigation. Assistant US Attorney John E. Haak is prosecuting the case.
Reisetter was remanded to the custody of the US Marshal. A trial date has not yet been set.
Alton Man Sentenced for Defrauding Federal Unemployment Insurance ProgramRead the Press Release
Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced that Charles Brumley, 42, of Alton, Illinois, was sentenced today in the United States District Court for defrauding the unemployment insurance program. Following his plea of guilty on October 3, 2012, to a one-count indictment for Embezzlement of Public Funds, the District Court sentenced Brumley to a 5 year term of probation. He also was ordered to repay approximately $17,732 in restitution to the Illinois Department of Employment Security and to pay a $100 special assessment.
“Even little children know that lying and cheating to receive unemployment compensation is a crime.” said United States Attorney Wigginton. “Those who defraud the unemployment insurance program undermine support for an important public program and hurt and insult every law-abiding citizen of Southern Illinois, particularly as public programs face economic crises. I will continue to place a high priority on pursuing those who steal from the United States Treasury.”
At the time of his guilty plea, Brumley admitted to being employed between February 2009 and January 2010 while also filing for and receiving unemployment insurance benefits. In order to receive the benefits, Brumley had to certify, approximately every two weeks, to the Illinois Department of Employment Security (IDES) that he was not working and that he was ready, willing, and able to work. He also had to verify that he was actively seeking work. Brumley was supposed to inform IDES of any income he received during the certification period, but he did not report that he was employed and earning money, instead choosing to collect both wages and benefits simultaneously. Between February 2009 and January 2010, Brumley collected $17,732 in employment insurance benefits to which he was not entitled.
This case was investigated by the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations; the United States Postal Inspection Service; and the Illinois Department of Employment Security. This case was prosecuted by Special Assistant United States Attorney Katherine L. Lewis.
Thursday 24 January 2013
Woman Charged with Embezzling Funds from the City of Marion, Illinois, Water DepartmentRead the Press Release
Linda Heyde, 59, of Marion, IL, was indicted by a grand jury and charged with three counts of embezzlement and theft, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. The offenses each carry a statutory maximum sentence of up to ten years in prison, a fine of up to $250,000 and mandatory restitution. The Indictment also seeks forfeiture of $524,100 in criminal proceeds.
The Indictment alleges that Linda Heyde, from 1996, through May, 2012, engaged in a scheme to defraud the City of Marion, Illinois, Water Department while she was the water department’s manager who had primary control over the billing accounts. The Indictment alleges that the City of Marion Police Department was advised that Heyde was handling the water department’s deposit funds in a suspicious manner and that daily bank deposits did not contain cash. The City of Marion Police Department installed covert cameras in the water department to monitor suspicious activities of Heyde. Heyde was observed on camera placing money in her purse. An audit was performed and showed that falsified adjustments had been made to customer accounts resulting in approximately $500,000 in missing funds.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge and is entitled to a fair trial at which the Government must prove guilt beyond a reasonable doubt.
The Indictment is the result of an investigation conducted by the City of Marion Police Department and the Federal Bureau of Investigation. The prosecution is being handled by Assistant U.S. Attorney Norman R. Smith.
Utah Man and Nevada Woman Charged with Tax ConspiracyRead the Press Release
SALT LAKE CITY -- A federal grand jury in Salt Lake City returned an indictment Wednesday afternoon charging Gerrit Timmerman III, 70, of Midvale, Utah, and Carol Sing, 73, of Henderson, Nev., with one count of conspiracy to defraud the United States. The indictment was announced by Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division and U.S. Attorney for the District of Utah David B. Barlow.
According to the indictment, from April 23, 2004, through March 5, 2007, Timmerman and Sing conspired to defraud the United States by marketing corporations sole as a part of a scheme to evade the assessment and payment of federal income taxes. Timmerman and Sing falsely told their clients that so-called “corporations sole” were exempt from United States income tax laws, had no obligation to file tax returns, and had no obligation to apply for tax exempt status. They further claimed that individuals could render their own income non-taxable by assigning it to the corporation sole, could draw a tax-free stipend from their corporation sole, and could render property immune from Internal Revenue Service (IRS) collection activity by transferring property to the corporation sole. During the life of the conspiracy, Timmerman and Sing were responsible for the creation of approximately 90 corporations sole; at the time their corporation soles were created, these clients had outstanding federal income tax assessments totaling at least $5,000,000.
An indictment is not a finding of guilt. Individuals charged in indictments are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Timmerman and Sing each face a maximum of five years in prison and a fine of up to $250,000.
The case is being investigated by IRS-Criminal Investigation and is being prosecuted by Tax Division Trial Attorneys Michael Romano and Dennis Kihm.
Unsealed Federal Indictment Charges 27 Members of Check Fraud ConspiracyRead the Press Release
The Co-conspirators Stole More Than $1 Million From Financial Institutions
CHARLOTTE, N.C. – A federal criminal indictment unsealed in U.S. District Court today charges 27 members of a check fraud scheme with bank fraud conspiracy and related charges, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. (See chart below for a list of federal charges and maximum penalties for each defendant).
Russell F. Nelson, Special Agent in Charge of the United States Secret Service, Charlotte Field Division and Chief Rodney D. Monroe of the Charlotte-Mecklenburg Police Department join U.S. Attorney Tompkins in making today’s announcement.
Of the 27 defendants charged in the indictment, 17 were arrested today, three are pending arrest (have agreed to turn themselves in), four are in state custody on state charges and three have not been arrested yet (photos of those not arrested are attached):
• Phillip Gregory Harris, Sr., aka “Cash P,” 30, of Charlotte. (arrested)
• Olwin Brown, aka “Juice” and “OJ,” 22, of Charlotte. (arrested)
• Kevin Smith, 33, of Charlotte. (arrested)
• Renardo Perry, aka “S-Dub,” 28, of Charlotte. (arrested)
• Jerry McDuffie, aka “J,” 31, of Whiteville, N.C. (arrested)
• Craig McInnis, 24, of Charlotte. (arrested)
• Yarral Wilson, 26, of Charlotte. (arrested)
• Kalif Wilson, aka “Scrap,” 28, of Charlotte. (arrested)
• Jarral Thompson, 28, of Clover, S.C. (arrested)
• Jakari Rutledge, 24, of Charlotte. (arrested)
• Martell Mackey, aka “Telly,” 26, of Charlotte. (arrested)
• Jade Brown, 24, of Charlotte. (arrested)
• Christopher Moat, 28, of Charlotte. (arrested)
• Rashad Johnson, 26, of Charlotte. (arrested)
• Quillie Smith, 29, of Charlotte. (arrested)
• Keosha Mack, aka “Kiki,” 28, of Charlotte. (arrested)
• Stanley Rutledge, Jr., 27, of Charlotte. (arrested)
• Jordan Forster, aka “2-3,” 26, of Charlotte. (pending)
• Pamela Kerns, 26, of Davidson, N.C. (pending)
• Tierra Love, 22, of Charlotte. (pending)
• Anthony Woods, aka “Gerod,” 30, of Charlotte. (in state custody)
• Tomonta Simmons, aka “Montay,” 21, of Charlotte. (in state custody)
• Christian Robertson, 20, of Charlotte. (in state custody)
• Walter Boyd, aka “Web,” 26, of Chester, S.C. (in state custody)
• Elijah Grant, aka “Box,” 28, of Charlotte. (not in custody)
• Travis Gabriel, aka “Gangster,” 27, of Charlotte. (not in custody)
• Demarcus Shankle, 25, of Charlotte. (not in custody)
According to allegations contained in the indictment:
From 2007 to 2014, the co-conspirators were involved in a check fraud scheme that operated in Mecklenburg, Gaston, Iredell and Cabarrus counties. The co-conspirators obtained checks linked to active bank accounts, either by purchasing or stealing them from the legitimate account holders. The co-conspirators then deposited these worthless checks made out for various amounts into bank accounts with very little or no available funds, thereby tricking the bank system into crediting the accounts with the funds. During the time it took the bank to process the bad checks, the co-conspirators used ATM cards and other methods to withdraw cash from those accounts. Over the course of the conspiracy, the defendants stole more than $1 million from numerous financial institutions.
“Combating financial fraud remains priority for my office. Fraud schemes like the one perpetrated by the defendants compromise the integrity of our financial system and leave the rest of us to pay for the incurred losses,” said U.S. Attorney Tompkins.
“Technology has forever changed the way we do business, making every day financial transactions a prime target for fraud,” said Charlotte Field Office Special Agent in Charge Russell F. Nelson. “The Secret Service, in conjunction with the Charlotte-Mecklenburg Police Department, and other task force agencies, continues to successfully combat these financial crimes by adapting our investigative methodologies. The U.S. Secret Service Electronic Crimes Task Force is a strategic alliance of law enforcement, academia and the corporate sector; dedicated to investigating, disrupting, and deterring cybercrime,” stated Nelson, “and this case serves as a great example of how these partnerships can strike a serious blow to organized crime groups that target our financial sector.”
“Financial frauds have been on the rise both on a national and on a local level,” said Chief Rodney Monroe, Charlotte-Mecklenburg Police Department. “With this recent check fraud conspiracy, I am so proud that our respective agencies were able to work together. Only through our partnerships are we able to bring about large indictments as this.”
All 27 defendants involved in the scheme have been charged with one count of bank fraud conspiracy and they face up to 30 years in prison and a $1 million fine. All defendants except Tomonta Simmons have also been charged with one count of bank fraud. Kevin Smith is also charged with one count of possession of counterfeit securities, one count of possession of stolen mail and one count of possession of firearms by a convicted felon. Phillip Harris faces an additional charge of aggravated identity theft, and Tomonta Simmons is charged with two counts of theft of firearms.
The defendants arrested today will appear in U.S. District Court before U.S. Magistrate Judge David S. Keesler. Elijah Grant, Travis Gabriel and Demarcus Shankle are still wanted by law enforcement.
The charges contained in the indictment are allegations. The defendants are presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
The investigation of this case was conducted by the U.S. Secret Service and CMPD. Assistant United States Attorney Kevin Zolot of the U.S. Attorney’s Office in Charlotte is prosecuting the case.
Law enforcement are still looking for (see photos): Travis Gabriel
Elijah Grant
Demarcus ShankleU.S. Attorney and Metro Drug Unit Commander Visit Lincoln County Schools to Discuss the Effects of Illegal Drug UseRead the Press Release
HAMLIN, W.Va. – United States Attorney Booth Goodwin and Metropolitan Drug Enforcement Network Team (MDENT) Commander Chad Napier today met with faculty and students from Duval Middle School and Lincoln County High School in Hamlin, Lincoln County, W.Va. to talk about the dangers and consequences of illegal drug use. The school visits provided law enforcement officials with the opportunity to talk one-on-one with students and faculty about the consequences associated with the region’s prescription drug abuse epidemic.
Prescription drug abuse is one of the leading sources of crime in the Southern District of West Virginia.
U.S. Attorney Booth Goodwin said, “"Education and awareness are the most essential tools that we have in our toolbox."Goodwin stated that reaching young people as early as possible is one of the most important ways to turn the tide against our state's prescription drug epidemic.
"The Metro Drug Unit saw a five-fold increase in illegal heroin seizure's in a year's time.” Goodwin continued, “That staggering statistic alone illustrates the battle that we are facing with opiate-based drugs. It is critical that students understand how incredibly addictive these substances can be if they head down the destructive path of drug abuse."
According to the Office of National Drug Control Policy, 2,500 youth (age 12 to 17) abuse a prescription pain reliever for the very first time every day. The Office of National Drug Control Policy research also found that the vast majority of teenagers abusing prescription drugs get them from friends or relatives.
MDENT Commander Lt. Chad Napier stated that Lincoln County has been particularly hard-hit by the prescription drug crisis.Lt. Napier said, "We are losing an entire generation to prescription drug abuse. If today's presentation reached just one student, then it was well worth the effort."
In November 2012, Goodwin and Napier also visited schools in Boone County as part of an ongoing awareness initiative led by the U.S. Attorney’s Office for the Southern District to educate faculty and students about the dangers of prescription drug abuse. Goodwin and Napier have also previously visited several schools in Jackson County as part of the awareness effort.
U. S. Attorney’s Office Collects $30.8 Million in Civil & Criminal Actions and Forfeitures in Fiscal Year 2012Read the Press Release
(Albany, New York) - United States Attorney Richard S. Hartunian announced today that the Northern District of New York collected a total of $30,811,828.88 in Fiscal Year (FY) 2012 in civil and criminal actions and forfeitures, comprised of $9,876,524.88 in criminal and civil actions and $20,935,304.00 in criminal, civil and administrative forfeitures. Of the $9,876,524.88, $2,715,873.25 was collected in criminal actions, as fines, restitution, and bail bond forfeitures, and $7,160,651.63 was collected in civil actions, as civil settlements, civil penalties, and defaulted loan recoveries.
Nationwide, the U.S. Attorneys’ Offices collected $13.16 billion in criminal and civil actions during FY 2012, more than doubling the $6.5 billion collected in FY 2011. A portion of this amount, $5.3 billion, was collected in shared cases involving more than one U.S. Attorney’s Office and/or Department of Justice litigating division. The $13.16 billion represents more than six times the appropriated budget of the combined 94 U.S. Attorney’s Offices for FY 2012.
“During these challenging economic times, collections are critically important,” said U.S. Attorney Richard S. Hartunian. “The U.S. Attorney’s Office is dedicated to protecting the public and recovering funds for the federal treasury and for victims of federal crime. We are also committed to holding accountable those who seek to profit from their illegal activities.”
Northern District of New York cases resulting in significant recoveries include the following:
A. Criminal Actions
In January of 2012, Lieze Associates, Inc., d/b/a Eagle Recycling, paid a criminal fine of $500,000 in connection with the unlawful disposal of millions of pounds of asbestos contaminated construction and demolition debris in a farmer's field in Frankfort, New York, from June through October of 2006. The owner of Eagle Recycling and his partner created a false New York State Department of Environmental Conservation permit to make it appear that the site was legal when it had nothing that a normal landfill would require, such as fences, scales, methods to capture and treat waste water runoff, intended sets backs from wetlands (and the Mohawk River), and hydro-geologic studies. Defendants included the principal Eagle operator, the landowner, the landfill operator, the owner of another recycling facility and his company from New Jersey (who also sent asbestos contaminated waste), and a waste broker who arranged for truckloads of material to be shipped. All defendants were convicted of conspiracy to violate the Clean Water Act and to commit mail fraud. Several others were convicted of obstruction of justice and making false statements to investigators.
B. Civil Actions
In February of 2012, the Northern District of New York recovered $2,000,000 as part of the settlement in the United States ex rel. Kuney v. Cablexpress Corp. (CXTEC) civil case. The settlement resolved allegations that CXTEC falsely represented where the computer parts it sold to the federal government had been manufactured. CXTEC signed a contract with the General Services Administration to provide computer parts, including cables and gigabit interface converters1 (GBICs), to the federal government. The contract was subject to the Trade Agreements Act, which requires that all products sold under it be manufactured in one of a list of designated countries. The settlement resolves allegations that CXTEC knowingly sold products to the United States from countries which are not on the designated list, such as China, a country that does not have reciprocal trade agreements with the United States. The settlement agreement also resolved allegations that CXTEC sold the government generic GBICs while falsely representing that they were name-brand GBICs.
In January of 2012, the Northern District of New York also recovered $3,576,056 as part of a settlement in the United States ex rel. Jorgenson v. Cayuga Medical Center, et. al. civil case. This settlement resolved a qui tam lawsuit alleging that Cayuga Medical Center recruited physicians into the local Ithaca area pursuant to recruitment agreements which violated a federal law known as the Stark Act. This law (42 U.S.C. §1395nn) applies to recruitment agreements between hospitals and physicians; it prohibits a physician from referring patients to a hospital if the physician has a financial relationship with the hospital, unless an exception applies. The Stark Act also prohibits a hospital from billing Medicare for a prohibited referral. Federal regulations and related guidelines do allow for hospitals to pay for certain expenses of medical practices who employ physicians recruited to the area by the hospital. However, the complaint alleged that Cayuga Medical Center recruited physicians to the area and paid for expenses that were not permitted by said regulations and guidelines, and improperly extended a physician recruitment agreement.
C. Forfeiture Cases
In November of 2012, the Northern District of New York forfeited approximately $11.28 million dollars in the case of United States v. Eric Canori. Canori pled guilty to participating in a conspiracy to distribute 100 or more kilograms of marijuana and was ultimately sentenced to 30 months imprisonment. The execution of search warrants at Canori’s residences in Wilton, New York, and Ross, California, resulted in seizures of currency, marijuana, and drug packaging. Subsequent investigation led to the recovery of precious metals, gold and silver, that were proceeds of the conspiracy. As part of his plea, Canori agreed to forfeit the currency and precious metals to the United States.
In April of 2012, the Northern District of New York collected $6,000,000 in forfeiture proceeds in the case of United States v. IFCO Systems North America (IFCO). IFCO, a Houston based company with a plant in Albany, New York, operated the largest pallet manufacturing company in the United States. The amount collected in April was part of a $20.7 million corporate settlement agreement, entered into in December of 2008, that resolved allegations that IFCO employed illegal aliens in its plants around the country.
The U.S. Attorneys’ Offices, along with the Department of Justice’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. Statistics indicate that the aggregate amount collected nationally in federal criminal actions totaled $3.035 billion in restitution, criminal fines, and felony assessments. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid directly to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
The statistics also indicate that a total of $10.12 billion was collected by the U.S. Attorneys’ Offices in individually and jointly handled civil actions. The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Departments of Housing and Urban Development, Health and Human Services, and Education, as well as the Internal Revenue Service and Small Business Administration.
Additionally, the U.S. Attorneys’ Offices, working with partner agencies and divisions, collected a total of $4.389 billion in asset forfeiture actions in FY 2012. Forfeited assets are deposited into the Department of Justice Assets Forfeiture Fund and Department of Treasury Forfeiture Fund and are used to restore funds to crime victims and for a variety of law enforcement purposes.
The $13.16 billion collected nationwide by the U.S. Attorneys’ offices for FY 2012 nearly matches the $13.18 billion collected in FY 2010 and FY 2011 combined.
For further information, the United States Attorneys’ Annual Statistical Reports can be found on the internet at http://www.justice.gov/usao/resources/annual-statistical-reports.
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1A gigabit interface converter 1 is a hot-swappable input/output device that plugs into a gigabit ethernet port or slot, linking the port with the network.
Three Men Charged with Possession of A Controlled SubstanceRead the Press Release
United States Attorney Brendan V. Johnson announced that Dennis Red Elk, age 32, of Rapid City, South Dakota; Maurice Johnson, age 33, of Rapid City, South Dakota; and Daniel Gangone, age 35, of Mission, South Dakota, appeared before United States Magistrate Judge Mark A. Moreno on January 17, 2013, and pled guilty to the Superseding Information that charged them with Possession of a Controlled Substance. The maximum penalty upon conviction is 1 year of custody, a $1,000 minimum fine but not more than $100,000 fine, or both; not more than 1 year of supervised release; and a $25 special assessment.
The charges stem from an incident wherein Red Elk, Johnson, and Gangone, on October 1, 2009 and April 19, 2010, came into contact with law enforcement officers, who discovered marihuana in the defendants’ possession.
The investigation was conducted by the Northern Plains Safe Trails Drug Enforcement Task Force and Assistant United States Attorney Kathryn N. Rich is prosecuting the case.
Red Elk and Gangone were released on bond pending sentencing. Johnson was remanded to the custody of the United States Marshals pending sentencing. A sentencing date has been set for April 16, 2013.