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Thursday 24 January 2013
Three Individuals Indicted for Prescription Drug Diversion ConspiracyRead the Press Release
Over $58 Million in Pharmaceuticals Diverted
Charles Jeffrey Edwards, 51, and Brenda Elise Edwards, 42, both of Houston, Texas, and Jerrod Nichols Smith, 43, of Sugar Land, Texas, were indicted by a federal grand jury on January 17, 2013, on charges that they conspired to obtain prescription pharmaceuticals from “street collectors” in New York and Miami, and to sell those prescription drugs to independent pharmacies as though the drugs had been obtained from legitimate wholesale distribution companies, announced Jerry E. Martin, U.S. Attorney for the Middle District of Tennessee.
All three defendants were indicted on charges of conspiracy and mail fraud related to the scheme. Additionally, Charles and Brenda Edwards were indicted on money laundering charges and Charles Edwards and Jerrod Smith were indicted for obstruction of justice. The indictment alleges that the scheme resulted in gross proceeds of over $58 million and that the defendants gained over $14 million in profits.
“The diversion of pharmaceuticals and the resulting risks of adulteration poses a grave threat to the public,” said U.S. Attorney Martin. “The U.S. Attorney’s Office and our regulatory and enforcement partners will aggressively pursue those who would seek to profit from such illegal activity and display such a total disregard for the safety of our citizens.”
According to the indictment, between December 2006 and August 2009, Charles Edwards and Jerrod Smith owned and operated Cumberland Distribution, Inc., (“Cumberland”) a wholesale prescription drug distribution business licensed in Tennessee. Brenda Edwards was an employee of Cumberland. Cumberland maintained a corporate office in Houston, Texas, and drug distribution warehouses in Nashville, Tennessee that were used to receive, sort, organize, package and ship pharmaceuticals to pharmacies throughout the United States.
The defendants allegedly purchased pharmaceuticals from a network of street collectors who obtained the drugs on the streets of New York and Miami from individuals who had legitimate prescriptions. The defendants then diverted the pharmaceuticals by repackaging and distributing them to independent pharmacies, making it appear as though the diverted pharmaceuticals had been obtained from a licensed wholesale distributor.As a part of this conspiracy, the defendants directed warehouse employees to cleanse the packaging of the pharmaceuticals to conceal the true origin of the drugs and to create false pedigrees and false entries in Cumberland’s books and records that made it appear as though the drugs had been legitimately obtained. Also, the defendants created a layer of distribution between the diverted pharmaceuticals and Cumberland by incorporating or causing others to incorporate various, separate businesses throughout the conspiracy and by causing the pharmaceuticals to be shipped to Cumberland through intermediaries. One such intermediary company was Tristate Management, in Texarkana, Arkansas. Charles and Brenda Edwards also directed wire transfers to pay for the pharmaceuticals obtained from the street collectors and to make payments to themselves.
The indictment also alleges that on July 15, 2009, Charles Edwards and Jerrod Smith submitted to a federal grand jury, 21false pedigree documents that each stated that Tristate Management had acquired the pharmaceuticals listed on the pedigrees from a licensed wholesaler, Ocean Pharmed in Irmo, SC. The pedigree documents were false because the pharmaceuticals had not been acquired from Ocean Pharmed, but had been acquired through a network of street collectors on the streets of South Florida, or New York City and surrounding areas.
"The FDA Office of Criminal Investigations, along with our law enforcement and regulatory partners work diligently to preserve the integrity of the pharmaceutical supply chain and will vigorously pursue those that threaten the safety of the American public," said David W. Bourne, Special Agent in Charge, U.S. Food and Drug Administration, Office of Criminal Investigations- Miami Field Office.
The wholesale distribution of prescription drugs in the United States is subject to regulation. Regulating the wholesale market ensures that drugs dispensed to patients are authentic and not counterfeit, properly labeled, and have been handled and maintained according to industry standards and Food and Drug Administration (FDA) requirements. Regulations also require that the prescription drugs be in the possession of state-licensed entities, and have a verifiable chain of custody, also known as a pedigree.Congress enacted the Prescription Drug Marketing Act in 1987 to combat a practice known as prescription drug diversion. In essence, diverted pharmaceuticals are those that have been removed from the regulated distribution channels but then reintroduced into the wholesale marketplace through various means, including the falsification of the accompanying pedigrees. Once a pharmaceutical is diverted outside of the regulated distribution channels, it becomes difficult, if not impossible, for the regulators or the end-users to know whether the pharmaceutical was altered, stored in improper conditions, or its potency adversely affected.
In a practice known as street diversion, diverters repurchase medications that have already been dispensed, remove the patient labels, and reintroduce them into the wholesale market. The aim of prescription drug diversion is to acquire drugs at steep discount and reintroduce them into the wholesale market in a manner that obscures the fact that the drugs were ever diverted. When done effectively, neither the pharmacist nor the consumer know that the diverted drugs are handled, packaged, and labeled by parties not authorized or qualified to do so.
In addition, federal law generally requires wholesale distributors to provide pedigrees with each wholesale distribution of a prescription drug, and prohibits any alteration or modification of the same. The pedigree lists all previous sales of that drug back to the last authorized distributor of record. Requiring such disclosure discourages the introduction of drugs that come from illegitimate sources like unlicensed wholesalers, closed-door pharmacies, street diverters, and drug counterfeiters. Separate and apart from the federal requirement, many states also require that wholesalers provide pedigrees with each wholesale distribution.
If convicted, the defendants face up to 20 years in prison on each count of mail fraud, 10 years on each count of money laundering, five years on the count of conspiracy, and five years on the count of obstruction of justice. They face fines of $250,000 on each count.This investigation was conducted by the FDA- Office of Criminal Investigations. Assistant U.S. Attorneys Kathryn B. Ward and Sandra G. Moses represent the government.
An indictment is merely an accusation and is not evidence of guilt. All defendants are presumed innocent unless and until proven guilty in a court of law.
Ten Charged in Superseding Indictment in Time Share Mortgage Fraud SchemeRead the Press Release
CAMDEN, N.J. – A federal grand jury for the District of New Jersey, sitting in Camden, has returned a 44-count Superseding Indictment against six individuals from southern New Jersey and four others for their alleged roles in a $3 million mail and wire fraud conspiracy involving time share mortgages, U.S. Attorney Paul J. Fishman announced today.
The six indicted defendants from New Jersey are: Adam Lacerda, 28, and his wife, Ashley R. Lacerda, 32, of Egg Harbor Township; Ian Resnick, 37, of Absecon; Steven Cox, 48, of Ventnor City; Francis Santore, 52, of Northfield; and Joseph Diventi, 32, of Somers Point.
Also indicted are: Alfred Giordano, 32, of Hurry County, S.C.; Brian Corley, 27, of Little River, S.C.; Joseph Saxon, 38, of St. Thomas, Virgin Islands; and Genevieve Manzoni, 46, of Lake Worth, Fla. The indictment was returned by a federal grand jury on Jan. 23, 2013.
Ian Resnick, Joseph Saxon, and Genevieve Manzoni previously were charged by criminal complaint. Adam Lacerda, Ashley R. Lacerda, Steven Cox, Alfred Giordano, Francis Santore, Brian Corley, and Joseph Diventi previously were indicted on the same charges by a federal grand jury sitting in Trenton on May 3, 2012.
The defendants are expected to be arraigned before U.S. District Judge Noel L. Hillman in Camden federal court in the coming weeks.
According to the Superseding Indictment and the Complaints previously filed:
In July 2010, law enforcement officers commenced an investigation into The Vacation Ownership Group, a/k/a VO Group LLC. The investigation revealed that beginning at least from March 2009 and continuing to Sept. 1, 2011, the defendants through the VO Group participated in a fraudulent scheme in which representatives of the VO Group called owners of timeshare vacation properties purchased from Flagship Resort Development, Wyndham Vacation Resorts Inc., and other timeshare developers and convinced the owners to submit money to the VO Group, purportedly to pay off their “mortgages” on their timeshares. The VO Group claimed that the timeshare owner could pay off the mortgage balance at a substantially reduced amount – often by as much as 50 percent of the amount of the owner’s original mortgage – by mailing payment to the VO Group at a P.O. Box in Pleasantville, N.J. The VO Group representatives also persuaded timeshare owners to send the VO Group money purportedly to have timeshares cancelled or sold. Rather than paying off the timeshare owner’s mortgage, cancelling the owner’s timeshare, or selling the timeshare, the conspirators kept the timeshare owner’s money for their personal use.
The investigation also revealed that in an attempt to cover up the scheme, the conspirators in most cases engaged in a “bait and switch” tactic by purchasing an additional timeshare in the victim’s name without the victim’s knowledge. The victim purportedly had assented to the purchase based on documents the VO Group previously emailed to the victim for signature even though the victim had been led to believe that the victim was simply paying off the victim’s original timeshare mortgage.
According to the Complaint, during the course of the investigation, law enforcement officers interviewed approximately 225 victims of the conspirators’ scheme identified to date. Many of the victims are elderly, causing them to be more vulnerable to the scheme. The Indictment states that law enforcement has determined that the conspirators defrauded the victims of more than $3 million.
The mail and wire fraud conspiracy charge – with which all defendants named in the Superseding Indictment are charged – is punishable by a maximum potential penalty of 20 years in prison and a $250,000 fine. Each additional, substantive charge of mail fraud or wire fraud carries an additional, maximum potential penalty of 20 years in prison and a $250,000 fine. The conspiracy to commit money laundering charge subjects defendants Adam and Ashley Lacerda to an additional, maximum potential penalty of 20 years in prison and a $500,000 fine. Defendants Adam and Ashley Lacerda also face an additional, maximum potential penalty of 10 years in prison for each substantive money laundering count in which they are charged.U.S. Attorney Fishman credited special agents from the FBI’s Atlantic City Resident Agency, under the direction of Acting Special Agent in Charge David Velazquez in Newark; and special agents from the Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations, under the direction of Special Agent in Charge Robert Panella, New York Region, for the investigation leading to today’s Indictment. He also thanked the N.J. Department of Labor, Benefit Payment Control Unit, for its assistance.
The government is represented by Assistant U.S. Attorneys Alyson M. Oswald and R. David Walk, Jr. of the U.S. Attorney’s Office Criminal Division in Camden.
The charges and allegations contained in the Superseding Indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Anyone who believes they are a victim of the fraud should contact the FBI’s Atlantic City Resident Agency at 609-677-6400.
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Defense counsel:
Adam Lacerda: Marc Neff Esq., Philadelphia, and Mark E. Cedrone Esq., Philadelphia
Ashley Lacerda: Charles Nugent, Marlton
Ian Resnick: Michael E. Reilly Esq., Philadelphia
Steven Cox: Jeffrey M. Miller Esq., Philadelphia
Alfred Giordano: Martin I. Isenberg Esq., Gibbsboro
Francis Santore: Robert A. Mintz Esq., Philadelphia
Brian Corley: José L. Ongay Esq., Camden
Joseph Saxon: David S. Rudenstein Esq. Philadelphia
Genevieve Manzoni: Ralph A. Jacobs Esq., PhiladelphiaLacerda, Adam and Ashley, et al., Superseding Indictment
Steelworkers Rep Sentenced for Stealing from UnionRead the Press Release
PITTSBURGH - A resident of St. Paul, Minn., has been sentenced in federal court to eight months imprisonment, to run concurrent to his Minnesota state charge, on his conviction of union embezzlement, United States Attorney David J. Hickton announced today.
United States District Judge Mark R. Hornak imposed the sentence on Curtis Reed, 56.
According to information presented to the court, Reed, a Staff Representative of the International Union of United Steelworkers, stole approximately $3,700 from the union by charging personal expenses to the union credit and fuel cards over the five-year period from March of 2005 to May of 2010.
Assistant United States Attorney Leo M. Dillon prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Department of Labor, Office of Labor Management Standards for the investigation leading to the successful prosecution of Reed.
Sixteen People Indicted for Their Role in Trafficking Ring That Brought Drugs to ClevelandRead the Press Release
Sixteen people were indicted on charges including drug trafficking, possessing illegal firearms and money laundering for their roles in a group that is accused of bringing cocaine, heroin and marijuana from Chicago and selling it in Cleveland, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, and Robert L. Corso, Special Agent in Charge of the Drug Enforcement Administration.
The ring operated between March and September 2012, according to the indictment. The defendants are from Cleveland unless otherwise noted.
The indictment charges Richard Price, Jr., aka "Richie," age 23; Alexander Abreu, aka "Cuba," age 42; Geraldo Maldonado, aka "Lalo," age 37; Richard Maldonado, age 27; Joshua Johnson, age 21; Robert Hoover, age 27; Gordon Egan, age 19; Reginald Hart, age 34, of Bedford; Pedro Gonzalez, age 29; John Childrey, age 22, of Brook Park; John Hoch, age 19, of Middleburg Heights; Michael Young, age 24; Patrick Corrigan, aka "Patrick Marflak," of Lakewood; and Cory Box, age 20, of Westlake, with conspiracy to distribute and possess with intent to distribute at cocaine, heroin, and marijuana.
Richard Price, Jr., is also charged with distributing cocaine and heroin, possessing with intent to distribute heroin, possessing a firearm in furtherance of a drug trafficking offense, being a felon in possession of firearms, maintaining a premises for drug trafficking, and money laundering. Joshua Johnson is also charged with distributing heroin. John Hoch and Alexander Abreu additionally are charged with money laundering.
Finally, Breanna Johnson, age 19, of Cleveland, Ohio, is charged with distributing heroin while Richard Price, Sr., age 49, is charged with being a felon in possession of a firearm.
“This groups is accused of bringing a variety of drugs, including heroin, cocaine and marijuana, from Chicago to the west side of Cleveland,” Dettelbach said. “Today’s arrests should send a message to those who seek to profit from the drug trade.”
Corso said: “This drug-trafficking organization, led by Richard Price, was unique in that it supplied the west side of Cleveland with such a vast array of illegal drugs. These arrests effectively cut off a pipeline that fed the streets of Cleveland. The success of this sophisticated investigation is directly related to the strong cooperation and support between DEA and our law-enforcement partners.”
The indictment describes a conspiracy in which Price, Jr., obtained cocaine, heroin, and marijuana from Abreu and other suppliers and then distributed the drugs to numerous dealers in the Cleveland area, while being assisted by several of the co-conspirators.
This case is being prosecuted by Assistant United States Attorneys Matthew W. Shepherd and Henry F. DeBaggis. This case was investigated through the combined efforts of the Drug Enforcement Administration (DEA) and Cuyahoga County Sheriff’s Office.
If convicted, the defendants’ sentences will be determined by the court after review of factors unique to this case, including the defendants’ prior criminal records, if any, the defendants’ roles in the offenses and the characteristics of the violations. In all cases, the sentences will not exceed the statutory maximum and in most cases they will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a
fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.Six Sentenced in Multi-million Dollar Stolen Goods CaseRead the Press Release
CHARLOTTE, N.C. – U.S. District Court Judge Max O. Cogburn, Jr. sentenced six members of an organized retail crime ring that sold and distributed over $16 million in stolen over-the-counter (“OTC”) products, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
Today’s sentencings of four co-defendants and the sentencings in October 2012 of two co-defendants are the result of “Operation Cash Back,” a multi-agency investigation that began in September 2010 into the buying and selling of stolen OTC and health and beauty aid (HBA) products. The prison sentences imposed on the six defendants range from 18 to 86 months’ imprisonment and include an order of restitution totaling $4,035,626. Judge Cogburn also ordered forfeiture of over $17,000 in cash, 20 motor vehicles, two real estate properties and a forfeiture money judgment of $7 million.
U.S. Attorney Tompkins is joined in making today’s announcement by Russell F. Nelson, Special Agent in Charge of the United States Secret Service, Charlotte Field Division; Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI); Chief James W. Buie of Gaston County Police Department; and Chief Stacy Conley, of the Gastonia Police Department.
In June 2011, a total of six defendants were charged with and pleaded guilty to one count of conspiracy to commit interstate transportation of stolen property. The defendants are, Bonnie Knight Bridges, 63, and Kimberley Bridges Morris, 37, both of Bessemer City, N.C.; Michael David Morris, 40, of Charlotte; Darlene Bridges Schoener, 39, and William Christopher Schoener, 33, both of Kings Mountain, N.C.; and Darryl Keith Brock, 45, of Cowpens, S.C. Bonnie Bridges, Kimberley and Michael Morris, and Darlene and William Schoener were also charged with and pleaded guilty to one count of tax evasion conspiracy. Bonnie Bridges is the mother of Kimberley Bridges Morris, who is married to Michael David Morris, and of Darlene Bridges Schoener, who is married to William Schoener.
Today, Judge Cogburn sentenced Kimberley Morris and Darlene Schoener to serve 18 months in prison, followed by three years of supervised release. Michael Morris was sentenced to 84 months in prison and two years of supervised release. William Schoener was sentenced to 86 months in prison and two years of supervised release. The defendants also were ordered to pay $4,035,636 in restitution.
Judge Cogburn sentenced Bonnie Bridges on October 19, 2012, to serve 70 months in prison followed by two years of supervised release, and ordered her to pay $4,035,636 in restitution. Judge Cogburn sentenced Darryl Keith Brock on October 30, 2012, to serve 20 months in prison followed by two years of supervised release, and ordered him to pay restitution in the amount of $2,128,059.
According to filed court documents and court proceedings, the defendants had participated in what is known as Organized Retail Crime (“ORC”) and Organized Retail Theft (“ORT”), an annual multi-billion crime affecting retail merchants. Court documents show that from 2006 to March 2011, the defendants engaged in a scheme whereby they bought and then sold stolen over-the-counter products, including medications and dietary supplements, and health and beauty aid products.
According to court records and court hearings, organized retail theft begins with individuals, known as “boosters,” who shoplift popular OTC and HBA products from the shelves of various pharmacy and retail stores. In this case, the “boosters” stole OTC and HBA products from stores in North Carolina, South Carolina West Virginia, Georgia, Pennsylvania and Connecticut. The “boosters” then sold the shoplifted goods far below retail and wholes prices to first-level “fences.” First-level fences in turn serve as middlemen between the “boosters” who steal the OTC and HBA products from retail merchant stores and second-level fences who further distribute the stolen goods to a higher-level fence or distributor, who then distribute the stolen products back into the retail marketplace.
According to court records and court hearings, the Bridges’ family members served as first-level fences who purchased stolen OTC and HBA products from “boosters.” The Bridges family members then sold the stolen OTC and HBA products to second-tier fences at prices far below the retail and wholesale prices of the stolen goods. Organized retail theft crime is a cash-only business, and the Bridges paid cash to “boosters” when purchasing the stolen OTC and HBA products, and were paid in cash by their second-tier fences for the stolen OTC and HBA products.
According to court records and court hearings, OTC and HBA goods stolen by “boosters” had to be “cleaned” of retail store security labels, tags, stickers, and pricing labels before they could be re-introduced through the various levels of fences into the retail marketplace. Cleaning stolen OTC and HBA products of genuine retail store security and pricing labels is a task performed by both first-level and second-level fences before reaching higher-level product distribution channels. The amount of stolen property involved in the Bridges case from 2006 to 2011 exceeded $16 million.
“The Congressional Research Service issued a report in December of 2012 that estimated the annual economic loss to businesses and consumers from Organized Retail Crime is between of $15 billion to $37 billion. The cooperative effort of the law enforcement agencies involved in this case was instrumental in breaking up this extensive conspiracy that plagued a wide range of retail businesses,” said U.S. Attorney Tompkins. “Retail theft means that consumers end up paying higher prices for goods sold by businesses impacted by those thefts. My office will continue to go after professional theft rings that engage in this form of organized retail crime.”
“The hard work and diligence of these investigators has paid off as they rooted out and followed the trail of this multi-million dollar theft scheme,” stated Special Agent in Charge Jeannine A. Hammett, IRS CI. “We should not expect the honest taxpayers to foot the bill for those who attempt to hide income from the IRS.
Bonnie Bridges has commenced serving her prison sentence. Michael Morris and William Schoener have been in custody since late 2011. Darryl Brock, Kimberly Bridges and Darlene Schoener will self-report to the Federal Bureau of Prisons upon designation of a federal facility. All federal sentences are served without the possibility of parole.
The investigation was handled by USSS, IRS-CI, the Gaston County Police Department and the Gastonia Police Department. This prosecution is handled by Assistant United States Attorneys Tom O’Malley and William Brafford of the Western District of North Carolina.
Sentences for January 23, 2013Read the Press Release
Michael Relyea, 26, of Gillette, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 23, 2013, for possession of a firearm not registered in the National Firearms Registration and Transfer Record. Relyea was arrested in Gillette, Wyoming. He received 21 months of imprisonment, to be followed by three years of supervised release and was ordered to pay a $100.00 special assessment. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Eleanor Perry, 41, of Thermopolis, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 23, 2013, for misappropriation of postal funds. Perry received five years probation and was ordered to pay restitution in the amount of $5,861.05. This case was investigated by the U.S. Postal Service.
Alonso Chavez-Loya, 28, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 23, 2013, for misuse of a social security number. Chavez-Loya was arrested in Casper, Wyoming. He received time served plus ten day, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the Diplomatic Security Service.
Hector Alvarado-Romero, 22, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 23, 2013, for illegal re-entry of a previously deported alien into the United States. Alvarado-Romero was arrested in Rawlins, Wyoming. He received time served plus ten days, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Victor Bacho-Miguel, 27, of Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on January 23, 2013, for illegal re-entry of a previously deported alien into the United States. Bacho-Miguel was arrested in Cheyenne, Wyoming. He received time served plus ten days, was ordered to pay a $100.00 special assessment and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Sarasota Man Sentenced to Five Years in Federal Prison for Sophisticated Mortgage Fraud SchemeRead the Press Release
Tampa, Florida - U.S. District Judge Steven D. Merryday today sentenced Arthur R. Seaborne (70, Sarasota) to 5 years in federal prison for conspiring to commit bank fraud. In addition, Seaborne was ordered to forfeit $4,269,886.55 in proceeds from the offense. The matter of restitution will be addressed at a later date. Seaborne pleaded guilty on November 6, 2012.
According to court documents and information presented in court, from as early as March 2003 through July 2008, Seaborne and others conspired to commit bank fraud. Throughout that time, Seaborne used several corporate entities to perpetuate the fraud scheme, including Southeast Capital Advisors, LLC. Through this entity, Seaborne marketed a “no money down” residential purchase program that operated by making loans to Seaborne’s clients, so that those clients could make down payments in connection with their purchases of residential properties.
Thereafter, Seaborne and his co-conspirators prepared and submitted mortgage loan applications to lenders for these same clients. The applications were fraudulent in that they omitted the fact that the clients’ down payments had been loaned to them. Further, the applications usually overstated the clients’ assets and understated their liabilities. Some loan applications also included the fraudulent misrepresentation that the clients intended to make the properties their primary residences, when in fact they were investment properties. Over the course of the fraud scheme, some of the loans on the residential properties went into default. Although the total loss amount has not yet been definitively determined, the losses incurred by the lenders amount to approximately $4 million.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Rachelle DesVaux Bedke and Joseph W. Swanson.
Rosebud Man Indicted for Third Degree Burglary and LarcenyRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rosebud, South Dakota, man has been indicted by a federal grand jury for Third Degree Burglary and Larceny.
Justin Gabriel, age 21, was indicted by a federal grand jury on December 12, 2012. He appeared before United States Magistrate Judge Mark A. Moreno on January 22, 2013, and pled not guilty to the indictment. The maximum penalty upon conviction is up to 10 years’ in custody, a $250,000 fine, or both; 3 years of supervised release; and a $100 Special Assessment. Restitution may also be ordered.
The charge is merely an accusation and Gabriel is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant United States Attorney Tim Maher is prosecuting the case.
Gabriel was remanded to the custody of the United States Marshal pending trial. A trial has not been set.
Rochester Man Sentenced in Child Pornography CaseRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Jason Koscielski, 24, of Rochester, N.Y., who was convicted of receipt, distribution and possession of child pornography, was sentenced to 135 months in prison and 30 years supervised release by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Marisa J. Miller, who handled the case, stated that the defendant came to the attention of law enforcement in January 2009 when members of the Toronto Police Service, in Toronto, Canada discovered Koscielski was online and sharing images of child pornography through a peer-to-peer file sharing program. The case was referred to Special Agents with Homeland Security Investigations who obtained a search warrant for the defendant’s residence. During the search, agents located more than 200 videos and 1,000 images of child pornography on digital media owned by the defendant.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The sentencing is the culmination of an investigation on the part of Special Agents of Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero.
Rapid City Man Charged with Theft of Government Property and False StatementRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for allegedly converting to his own use funds of the United States Air Force between August and December of 2011.
Derrick Scott, age 22, was indicted by a federal grand jury on November 19, 2012, for Theft of Government Property and False Statement. Scott appeared before United States Magistrate Judge Veronica L. Duffy on January 15, 2013, and pleaded not guilty to the indictment. The maximum penalty upon conviction is 10 years' imprisonment and a $250,000 fine. The charges are merely accusations and Scott is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Department of the Air Force. Scott was released on bond pending trial. A trial date has been set for March 26, 2013.
Pure Meth Lands Kyle Man in Prison for 20 YearsRead the Press Release
CORPUS CHRISTI, Texas – A Man from Kyle has been sentenced to 240 months in federal prison without parole for conspiracy to possess with intent to distribute more than 500 grams of methamphetamine, United States Attorney Kenneth Magidson announced today. Anthony Rolls, 28, pleaded guilty April 30, 2012.
Today, U.S. District Judge Nelva Gonzales Ramos sentenced him to 240 months in prison to be followed by a five-year-term of supervised release.
In March 2012, Border Patrol agents at the Sarita checkpoint arrested Rolls after agents discovered approximately 3.5 kilograms of methamphetamine concealed within the vehicle’s battery. Additionally, agents were able to identify and detain another vehicle traveling with Rolls, driven by co-conspirator Jesus Castillo Jr. at a gas station in Riviera. A detailed inspection of the second vehicle resulted in the discovery of approximately 3.5 kilograms of methamphetamine also concealed within the battery. Laboratory analysis determined that the methamphetamine had a purity of more than 95%.
Castillo is currently serving a 235-month sentence in the U.S. Bureau of Prisons for his involvement.
In federal custody since his arrest, Rolls will remain in custody and serve his sentence at a U.S. Bureau of Prisons facility to be designated in the near future.
The charge stems from an investigation by Drug Enforcement Administration and the United States Border Patrol. Assistant U.S. Attorney Lance Watt prosecuted the case.
Pittsburg Woman Sentenced to 18 Months in Prison for Filing Tax Returns Using Stolen IdentitiesRead the Press Release
SAN FRANCISCO – Taneshia Stephenson yesterday was sentenced to 18 months in prison for conspiring to file false claims, United States Attorney Melinda Haag and Internal Revenue Service Criminal Investigation (IRS-CI) Special Agent in Charge Jose M. Martinez announced.
Stephenson pleaded guilty on Oct. 3, 2012. According to her plea agreement, beginning in July 2008, Stephenson helped other individuals obtain fraudulent tax refunds from the Internal Revenue Service based on tax returns that were filed using stolen identities. Stephenson admitted that each of the tax returns she assisted in filing claimed fictitious Social Security income and withholding as a basis for the fraudulent tax refund. As part of the scheme, Stephenson and her coconspirators asked the IRS to directly deposit the fraudulent refunds into a bank account that Stephenson could access. In 2008, Stephenson allowed her bank account to be used by another individual for that purpose.
According to documents filed with the court, this case is part of a larger investigation involving more than 20 other defendants. In response to these types of cases, the Justice Department’s Tax Division issued a new directive to further the efforts of the Tax Division and help U.S. Attorneys’ Offices respond quickly and effectively to the challenges in stolen identity refund fraud (SIRF) cases. To further this goal, Tax Division Directive 144, which took effect on Oct. 1, 2012, was issued to streamline the process for prosecuting these offenses.
Thomas Newman is the Assistant U.S. Attorney who prosecuted this case. The prosecutions are the result of an investigation by the Pittsburg Police Department and the Internal Revenue Service, Criminal Investigation Division.
Philadelphia Man Charged with Bank RobberyRead the Press Release
Keith McCracken, 34, of Philadelphia, was charged today by Indictment with one count of bank robbery announced United States Attorney Zane David Memeger. In particular, the indictment charges the defendant with having robbed the M&T Bank, 7121 Frankford Avenue, Philadelphia, on December 31, 2012.
If convicted, McCracken faces a maximum sentence of 20 years imprisonment, a three-year term of supervised release, a $250,000 fine, and a $100 special assessment.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Paul G. Shapiro.
Click here to view the indictment
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Parmelee Man Acquitted on Sexual Abuse ChargesRead the Press Release
United States Attorney Brendan V. Johnson announced that a Parmelee man was acquitted on two counts of Abusive Sexual Contact as a result of a federal jury trial in Pierre, South Dakota. Randy Never Misses A Shot was indicted by a federal grand jury in November of 2012.
The charges relate to the alleged abusive sexual contact with the victim in October of 2012.
The investigation was conducted by the Federal Bureau of Investigation, and the United States Attorney's Office prosecuted the case.
Owners of Gun Store/Beauty Shop Plead Guilty to Firearms ViolationsRead the Press Release
WICHITA, KAN. – A Butler County couple who ran a combined beauty shop and gun store have pleaded guilty to federal firearms violations, U.S. Attorney Barry Grissom said today.
Jeffrey Eberhart, 51, Augusta, Kan., pleaded guilty to one count of dealing firearms without a license. His wife, Tracey Eberhart, 42, Augusta., Kan., pleaded guilty to one count of failing to keep records of firearms transactions.
The Eberharts operated Traceys Dream Weavers Salon And Sporting Goods at 431 State Street in Augusta, Kan. The store advertised that it was “Where Beauty and Bullets Collide.” In his plea, Jeffrey Eberhart admitted that he bought and sold hundreds of firearms at the store and at gun shows from Oct. 1, 2009, to Aug. 22, 2012. Throughout that time, he was not licensed as a federal firearms dealer because he was a previously convicted felon.
In her plea, Tracey Eberhart admitted that while she held a license as a federal firearms dealer she failed to keep records and make reports to the Bureau of Alcohol, Tobacco, Firearms and Explosives on at lease 33 firearms transactions.
Sentencing is set for April 15. Prosecutors are recommending a sentence of five years in federal prison for Jeffrey Eberhart and three years probation for Tracey Eberhart.
Grissom commended the Bureau of Alcohol, Tobacco, Firearms and Explosives and Assistant U.S. Attorney Matt Treaster for their work on the case.
Operator of Delaware-Based Software Piracy Websites Sentencted to 58 Months for Copyright Infringement and Identity TheftRead the Press Release
WILMINGTON, Del. - Jamie Lynn Snyder, age 35, of Newark, Delaware, was sentenced to 58 months in prison today for criminal copyright infringement and identity theft in which she obtained over $1 million in illicit proceeds. Snyder also was sentenced to 3 years of supervised release, which will commence following her prison term, and was ordered to pay a total of $1,013,407.69 in restitution to her victims.
According to statements made at today’s hearing and documents filed in court, between January 1, 2008 and April 27, 2010, Snyder operated websites through which she sold, without authorization, at least 24,044 individual copies of pirated software products copyrighted by at least 81 different software manufacturers to thousands of customers. The total estimated retail value of the pirated software sold by Snyder surpassed $5.9 million.
The FBI made undercover purchases of over 20 software titles from the websites, which were located online at www.cheapestsoftwareanywhere.com and www.cheapestlegalsoftware.com. Included among the purchased software were some of the most popular titles manufactured by Adobe, Apple, Autodesk and Microsoft. The FBI also received numerous complaints from consumers across the country who believed they were lawfully purchasing software from Snyder’s websites, only to learn that Snyder was not authorized to sell the software, which could not be updated properly or registered with the manufacturers. In fact, the professional-looking websites also contained various statements attesting to their legitimacy and lawful sale of the software to consumers.
The FBI’s investigation further revealed that Snyder personally profited in the amount of $971,935.10 from the unlawful software transactions between February 26, 2008 and March 3, 2010.
In April 2010, the FBI executed a search warrant at Snyder’s Newark residence and interviewed Snyder. During that interview, Snyder confessed to operating the websites while knowing that it was unlawful for her to sell the software titles without authorization. She estimated that she was advertising approximately 400 software titles on the website, and had been earning approximately $25,000 to $35,000 per month from sales over past two years.
On November 16, 2011, Snyder pled guilty to criminal copyright infringement and was released on her own recognizance pending sentencing. Upon learning of Snyder’s guilty plea from news reports, the owners of TriMark Enterprises LLC, which employed Snyder as a bookkeeper, reported to the Delaware State Police and the FBI that Snyder had embezzled approximately $40,000 from the Wilmington-based company between February 2011 and January 2012. According to the business owners, Snyder forged numerous checks payable to herself and her creditors and also made unauthorized purchases of personal items on a company credit card. When confronted by a Delaware State Police detective about the allegations, Snyder admitted to the fraud.
Following the sentencing hearing, United States Attorney Charles M. Oberly, III, stated, “Fueled by the Internet, American companies lose billions of dollars each year to the unlawful distribution of products that they invent and manufacture. What Snyder did from computers in her living room was digital theft of over $5.9 million in merchandise. While in the process of pleading guilty to that offense, she went on to steal $40,000 from her local employer. Today’s sentence demonstrates that serial fraudsters should expect to receive stiff sentences.”
This case is being investigated by the Federal Bureau of Investigation and the Delaware State Police, and is being prosecuted by Assistant United States Attorney Edward J. McAndrew.
Ohio Insurance Salesman Sentenced to 20 Months in Prison for Tax Obstruction and Currency StructuringRead the Press Release
A federal judge in Cleveland today sentenced William R. Herder of Bellville, Ohio, to 20 months in prison for tax crimes, Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally, U.S. Attorney for the Northern District of Ohio Stephen M. Dettelbach and Special Agent in Charge, Internal Revenue Service (IRS) - Criminal Investigation, Cincinnati Field Office, Darryl K. Williams announced. U.S. District Judge Donald C. Nugent also ordered Herder to pay restitution to the IRS of $149,238 plus interest and penalties.
Herder pleaded guilty in October 2012 to corruptly endeavoring to obstruct the administration of the tax laws and currency structuring. According to documents filed in the case, Herder, an independent insurance salesman for Aflac Inc., failed to file timely and accurate income tax returns for the years 2000-2009 despite earning substantial insurance commissions and receiving warnings and notices from the IRS. Herder filed returns for the years 2010 and 2011 on which he reported that he owed taxes to the government, but failed to pay the almost $50,000 in taxes that he owed for those years.
According to the plea agreement and indictment filed in this case, to prevent the IRS from collecting his unpaid taxes, Herder attempted to conceal his assets and income. In 2004, Herder formed two entities in Nevada – one for the purpose of hiding his automobiles and another for the purpose of hiding his insurance business. Herder also began converting his insurance commission checks to cash and paying his expenses in cash to prevent the IRS from collecting his taxes from his bank account.
The plea agreement and indictment filed in this case also stated that Herder submitted numerous obstructive letters and documents to the IRS, Aflac and his credit union in an effort to prevent the IRS from assessing and collecting his taxes. In these letters, Herder falsely claimed, among other things, that the tax laws were not applicable to him. In 2005, Herder attempted to pay his taxes with a fake financial instrument called an “International Bill of Exchange.”
Last year, William R. Herder’s father, William A. Herder, was found guilty at trial of tax evasion, corruptly endeavoring to obstruct the administration of the tax laws and five counts of failing to file tax returns and was sentenced to 37 months in prison. William A. Herder also sold insurance for Aflac Inc. as an independent contractor. Another insurance salesman, Thomas Mitchell, the uncle of William R. Herder, also pleaded guilty to failing to file a tax return in 2012. William R. Herder has admitted in court papers that he, his father and his uncle participated in a tax defier “program” promoted by convicted felon Joseph Flickinger.
Assistant Attorney General Keneally commended the efforts of Special Agents of IRS – Criminal Investigation, who investigated the case, and Tax Division Trial Attorneys Melissa S. Siskind and Jeffrey A. McLellan, who prosecuted the case.
Nine Elmore County Residents and One Montgomery County Resident Arrested in Early Morning Drug RaidRead the Press Release
Montgomery, Alabama - Nine Elmore County residents and one Montgomery County resident were arrested today by the Federal Bureau of Investigation (FBI) and the Central Alabama Drug Task Force (CADTF) for conspiring to distribute crack cocaine, United States Attorney George L. Beck, Jr. announced today. The arrests stemmed from a federal indictment that charged 14 people from Elmore and Montgomery Counties.
During this morning’s raid, law enforcement arrested Terry Tyrone Humphrey, 41, of Montgomery; Tristan Travis Rawls, 33, of Wetumpka; Jacky Sagers, 32, of Wetumpka; Arthur Rodrequis Young, 41, of Wetumpka; British Tremaine George, 34, of Wetumpka; Damichael Orlane Chapman, 23, of Wetumpka; Duke George, 33, of Wetumpka; Patrick Demond Hicks, 35, of Wetumpka; and Robert McKenzie, 22, of Wetumpka. Kevin Levan Elmore, 36, of Montgomery; Stacy Rodrekus Calloway, 24, of Wetumpka; Markevius Jerrell Calloway, 22, of Wetumpka; and Tyrone Devontae George, 24, of Wetumpka are all already in custody on other charges. Carlos Montrell Harris , 25, of Wetumpka is still at large.
The 57-Count Indictment charges Kevin Levan Elmore, Stacy Rodrekus Calloway, Terry Tyrone Humphrey, Tristan Travis Rawls, Markevius Jerrell Calloway, Jacky Sagers, Tyrone Devontae George, Arthur Rodrequis Young, British Tremaine George, Damichael Orlane Chapman, Carlos Montrell Harris, Duke George, Patrick Demond Hicks, and Robert McKenzie conspired to possess with intent to distribute and distribute over 280 grams of crack cocaine.
Defendants Terry Humphrey, Stacy Calloway, Markevius Calloway, British Tremaine George, Robert McKenzie, Tyrone Devontae George, Arthur Rodrequis Young, and Damichael Orlane Chapman are also charged with distributing crack or powder cocaine on specific dates between June 2011 and January of 2012. A number of the defendants are charged with using cellular telephones to facilitate drug trafficking. Stacy and Markevius Calloway are also each charged with possessing firearms in relation to their drug trafficking offenses.
“These people were spreading poison to our residents and to our children,” stated U.S. Attorney Beck. “To make a profit from poisoning your community with drugs is horrendous. Those that spread this poison should be and will be prosecuted”
Federal Bureau of Investigation, Special Agent in Charge, Stephen E. Richardson, stated: “This investigation is an example of the collaboration between the FBI, DEA and the Elmore County Drug Taskforce’s efforts to ensure that our streets and communities continue to be protected against those who traffic in illegal drugs.”
“Today's arrests show what successful cooperation between all levels of law enforcement can accomplish,” said Elmore County Sheriff, Bill Franklin. “This case has delivered a tremendous blow to both drug dealers and violent criminals that attempted to operate in Elmore County and the county is safer because of it.”
If convicted, the defendants are facing a minimum of 10 years in prison and a maximum of life in prison. An indictment merely alleges that crimes have been committed, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt.
The investigation of this case was spearheaded by the FBI and the CADTF. Other law enforcement agencies assisted with the execution of the arrest warrants, including the United States Marshals Service, the Drug Enforcement Administration, the Elmore County Sheriff’s Office, and the Montgomery Police Department. The case is being prosecuted by Assistant United States Attorney Brandon K. Essig.
PRESS CONTACT: Clark Morris
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Telephone: (334) 551-1755
Fax: (334) 223-7617Nine Charged in $10 Million Mortgage Fraud SchemeRead the Press Release
NEWARK, N.J. – Nine people involved in a long-running, large-scale mortgage fraud scheme that caused losses of approximately $10 million were charged in two Complaints with conspiracy to commit bank fraud, U.S. Attorney Paul J. Fishman announced.
Jose Luis Salguero Bedoya, also known as Jose Salguero, 36, of Elizabeth and Verona, N.J.; Paul Chemidlin, Jr., 41, of Morganville, N.J.; Delio Coutinho, 50, of Colonia, N.J.; Joseph DiValli, 44, of Jackson, N.J.; Christopher Ju, 26, of East Brunswick, N.J.; Carmine Fusco, 44, of East Hanover, N.J.; Jose Martins, 31, of Newark, N.J.; Yazmin Soto-Cruz, also known as Yazmin Soto, 32, of Elizabeth, N.J.; and Kenneth Sweetman, 32, of Lyndhurst and Nutley, N.J., were arrested this morning by FBI special agents.
Salguero, Chemidlin, Coutinho, DiValli, Ju, Fusco, Martins, Soto, and Sweetman, are scheduled for initial appearances and bail hearings this afternoon before U.S. Magistrate Judge Joseph A. Dickson in Newark.
According to the Complaints:
From March 2008 to July 2012, the defendants engaged in multiple mortgage fraud conspiracies targeting at least 15 properties in and around Newark and Elizabeth, N.J. The defendants mortgage frauds took several forms, including obtaining control of properties through fraudulent “short sale” transactions, short sale flips, and identity theft. They submitted materially false mortgage loan documents to lenders in order to obtain loan proceeds, which the defendants then used for their own financial gain. The defendants also obtained money through various sales to straw buyers.
From March 2008 to June 2010, Salguero, Coutinho, Ju, and Soto conspired with each other and others to release liens on encumbered properties via fraudulently arranged short sale transactions. This allowed the defendants to profit from new fraudulent mortgage loans obtained on the properties from other mortgage lenders. To complete the short sale transactions, the defendants submitted materially false closing and other documents to mortgage lenders. They submitted materially false mortgage loan applications to mortgage lenders to obtain new mortgage loans on properties in and around Elizabeth, New Jersey, including a property on Fulton Street.
From March 2011 to July 2012, Salguero, Chemidlin, DiValli, Fusco, Martins, and Sweetman submitted false mortgage loan applications to mortgage lenders for a property on Smith Street, Elizabeth. The defendants submitted gift letters to mortgage lenders that falsely stated that the borrower was obtaining the funds necessary to close the real estate transaction from a relative or friend in the form of a gift, when the funds used as the borrowers’ down payments were actually provided by Salguero. The defendants also submitted false appraisal reports in order to support inflated property values and therefore obtain mortgage loans in larger amounts. The defendants formed limited liability companies (“LLCs”) in the names of companies similar to those of licensed title companies in order to open bank accounts in the LLC names to conceal the defendants’ identities and to control the receipt and distribution of fraudulently obtained mortgage loan proceeds. They submitted fraudulent documents that misrepresented Salguero’s ownership in various properties and the disposition of mortgage loan proceeds related to various transactions. The defendants then distributed fraudulently obtained mortgage loan proceeds to themselves and others and concealed those distributions by failing to include them on the HUD-1 Settlement Statements.
As a result of the mortgage fraud schemes described in the two Complaints, which involved at least 15 properties, the defendants and others defrauded financial institutions out of approximately $10 million.
The defendants played different roles in the schemes. Salguero was a real estate investor who, along with his girlfriend, Soto, provided much of the funds used by the defendants to perpetuate their fraudulent schemes. Coutinho was a loan officer at a Northern New Jersey mortgage brokerage company; he submitted false documents in support of the schemes. Chemidlin provided fraudulent real estate appraisals for the defendants although he was not a licensed real estate appraiser. DiValli was a loan officer at a Northern New Jersey mortgage brokerage company who also submitted false documents in support of the schemes. Ju negotiated the fraudulent short sale real estate transactions. Fusco and Sweetman conducted fraudulent real estate closings for the defendants although they were not licensed attorneys or title agents. Martins was a bank employee who facilitated certain financial transactions for the defendants.
The criminal Complaints charge each of the defendants with one count of conspiracy to commit bank fraud, which is punishable by a maximum potential penalty of 30 years in prison and a fine of $1,000,000.
U.S. Attorney Fishman credited law enforcement agents of the FBI Newark Mortgage Fraud Task Force for the investigation leading to today’s charges. Specifically, U.S. Attorney Fishman thanked special agents of the FBI, under the direction of Acting Special Agent in Charge David Velazquez, postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Maria Kelokates, special agents of the U.S. Housing and Urban Development, Office of Inspector General, Northeast Region of Investigations, under the direction of Special Agent in Charge Cary Rubenstein, special agents of the Federal Housing Finance Agency, Office of Inspector General, under the direction of Inspector General Steve Linick, special agents of the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), under the direction of Special Inspector General Christy Romero, and special agents of IRS–Criminal Investigation, under the direction of Acting Special Agent in Charge Shantelle P. Kitchen, and the Hudson County Prosecutor’s Office, under the direction of Acting Prosecutor Gaetano Gregory.The government is represented by Assistant U.S. Attorneys Lakshmi Srinivasan Herman, Aaron Mendelsohn, and Charlton Rugg of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement 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 charge and allegations contained in the Complaints against each defendant are merely accusations, and the defendants are considered innocent unless and until proven guilty.
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Chemidlin, Pau et al. ComplaintNew Haven Drug Dealer Sentenced to More Than Five Years in Federal PrisonRead the Press Release
January 24, 2013David B. Fein, United States Attorney for the District of Connecticut, today announced that JOHNNY SERRANO, also known as “BeBe,” 24, of New Haven, was sentenced yesterday by United States District Judge Robert N. Chatigny in Hartford to 70 months of imprisonment, followed by four years of supervised release, for distributing narcotics in New Haven.
According to court documents and statements made in court, in April 2011, the Bureau of Alcohol, Tobacco, Firearms and Explosives, in conjunction with the Drug Enforcement Administration and the New Haven Police Department’s Tactical Narcotics Unit, began an intensive investigation into drug dealing in the vicinity of 36 Maltby Place in the Fair Haven section of New Haven. The investigation, which included the use of court-authorized wiretaps, law enforcement surveillance and controlled purchases of crack cocaine and cocaine from a number of individuals, revealed that SERRANO and others operated an open-air narcotics market where they sold crack cocaine, cocaine, and heroin to customers on a daily basis.
SERRANO has been detained since his arrest on November 16, 2011. On October 1, 2012, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 28 grams or more of cocaine base (“crack”) and a quantity of cocaine.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration and the New Haven Police Department’s Tactical Narcotics Unit. The Stamford Police Department has provided critical assistance to the investigation.
This case is being prosecuted by Assistant United States Attorneys Anthony E. Kaplan and Marc H. Silverman.
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U.S. ATTORNEY'S OFFICE
Tom Carson
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[email protected]Multi-State Mortgage Fraudster Sentenced to 10 Years in PrisonRead the Press Release
PENSACOLA, FLORIDA – Lonett Rochell Williams47, Woodland Hills, California, was sentenced yesterday to 10 years in prison for conspiracy to commit mail fraud, conspiracy to commit money laundering, and six substantive counts of mail fraud.
In October of last year, Williams pled guilty to an eight-count indictment alleging that she participated in a conspiracy to defraud multiple lenders as part of a scheme to fraudulently purchase thirty-seven properties located in Texas, Georgia, and California, and in Navarre, Panama City Beach, and Sarasota, Florida. Approximately $20,448,767 in loans were issued by the lenders in connection with the real estate deals. Williams and her company received more than $4.5 million in kickbacks as a result of the scheme.
In September 2011, Williams’ son, Raysean K. Richardson, 28, New York, New York, was separately indicted on charges of conspiracy to commit mail fraud, mail fraud, and conspiracy to commit money laundering based on his role in the scheme. Richardson was convicted as charged following a jury trial held before Chief United States District Judge M. Casey Rodgers in September 2012. He is scheduled to be sentenced on February 19, 2013, by Judge Rodgers. Richardson faces up to twenty years in prison on each of the three counts of conviction.
Pamela C. Marsh, United States Attorney for the Northern District of Florida, praised the work of IRS-Criminal Investigations, the FBI and the Florida Department of Law Enforcement, whose joint investigation led to the convictions in these cases.
“Mortgage fraud, like all financial crimes, adds to the underground economy, erodes the integrity of our tax system and threatens the financial health of our communities as has been witnessed over the past several years” stated Special Agent in Charge James Robnett of the IRS Criminal Investigation Tampa Field Office. “Our agency, in cooperation with other federal and state law enforcement partners, target the offenders of mortgage fraud in our attempt to stem the tide of criminal activities that lay waste to the underpinnings of our financial system and this sentence should serve as a deterrent to those thinking about committing the same crimes.”
United States Attorney Marsh noted that prosecution is a continuation of this office’s vigorous efforts to combat mortgage fraud as part of Operation Stolen Dreams, a nationwide sweep that targeted mortgage fraud throughout the country. The largest collective enforcement effort ever brought to bear in confronting mortgage fraud, Operation Stolen Dreams was organized by the Mortgage Fraud Working Group of President Obama’s Financial Fraud Enforcement Task Force, which was established to lead an aggressive, coordinated effort to investigate and prosecute financial crimes.
The case was prosecuted by Assistant United States Attorney Tiffany H. Eggers.
Morrison Man Arrested for Possession of Improvised Explosive DevicesRead the Press Release
DENVER – Richard Lawrence Sandberg, age 35, of Morrison, Colorado, was arrested this morning by Special Agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), United States Attorney John Walsh and ATF Special Agent in Charge Andrew Traver announced. Sandberg appeared in U.S. District Court this afternoon where he was advised of his rights and the charges pending against him. He is being held without bond pending a detention hearing. The detention hearing and a preliminary hearing is scheduled for January 29, 2013 at 10:00 a.m. before U.S. Magistrate Judge Michael Watanabe.
Because there was a likelihood of improvised explosive devices in the Sandberg home, ATF agents, working closely with the Jefferson County Sheriff’s Office cordoned off an area around the home while conducting their search. Agents ultimately removed multiple improvised explosive devices, which were taken to a remote location and rendered safe. Three different bomb squads assisted the ATF, including the Denver Police Department Bomb Squad, the Jefferson County Sheriff Bomb Squad and the Colorado Springs Regional Explosives Unit. All were at the scene this morning, documenting evidence and assisting in handling the devices.
According to the affidavit in support of the Criminal Complaint, the investigation began when a Denver Police detective learned from a confidential informant that an individual who possessed improvised explosive devices. The detective contacted ATF regarding this information. ATF, acting on this information, worked with the confidential informant to introduce an undercover agent to meet the subject, who turned out to be Richard Sandberg. After a number of phone conversations the undercover agent and the confidential informant went to Sandberg’s residence, where they were shown improvised explosive devices. Sandberg reportedly said he wanted to trade the devices for cocaine, or for $300 each.
During the meeting Sandberg made numerous threatening statements towards law enforcement and specifically ATF. He stated that he was a former Marine, which is when he learned how to build powerful explosive devices. At the conclusion of the meeting, Sandberg gave the undercover agent three devices, which contained explosive powder, a fuse and shrapnel in the form of stainless steel ball bearings. ATF confirmed that Sandberg was not allowed to possess such devices according to the National Firearms Registry.
“Improvised Explosive Devices – IEDs – are against federal law, and with good reason: They have no legitimate purpose, and put an entire neighborhood at risk,” said U.S. Attorney John Walsh. “Thanks to strong cooperation between state, local and federal law enforcement in this case, a person who built IEDs has been apprehended and those devices recovered and neutralized.”
“ATF agents, working closely with our local law enforcement partners, identified and arrested a potentially violent individual who was posing a significant danger to the community,” said ATF Special Agent in Charge, Andrew Traver. “Through this cooperative effort, we were able to remove numerous destructive devices and stop any further potential harm to the citizens of Morrison, Colorado.”
Sandberg is currently charged with one count of possession of a firearm (which includes explosive devices) which is not registered in the National Firearms Registration and Transfer Record. If convicted, the defendant faces not more than 10 years in federal prison, and a fine of not more than $250,000.
This case was investigated by ATF, the Denver Police Department and the Jefferson County Sheriff’s Office.
Sandberg is being prosecuted by Assistant U.S. Attorney Jeremy Sibert.
A Criminal Complaint is a probable cause charging document. Anyone accused of committing a federal felony crime has a Constitutional right to be indicted by a federal grand jury.
The charges contained in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
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Minneapolis Man Pleads Guilty to Conspiring to Distribute Controlled SubstancesRead the Press Release
MINNEAPOLIS—Earlier today in federal court in St. Paul, a 38-year-old Minneapolis man pleaded guilty to distributing cocaine, crack cocaine, and the semisynthetic psychedelic drug MDPV, commonly known as ecstasy. Antoine Kenyetta Poole specifically pleaded guilty to one count of conspiracy to distribute controlled substances. Poole, who was indicted along with Jermaine Aquarius Edison on September 11, 2012, entered his plea before United States District Court Judge Donovan W. Frank. On December 18, 2012, Edison, age 40, also of Minneapolis, pleaded guilty to one count of conspiracy.
In their plea agreements, the defendants admitted that from February 14 through August 16, 2012, they conspired with others to distribute 500 or more grams of cocaine, 28 grams of crack cocaine, and ecstasy. The conspiracy involved sending large amounts of cash to California for the purchase of cocaine. For example, on May 2012, law enforcement seized a package containing $18,000, which Edison was sending to California. In entering their pleas, the defendants also admitted distributing the controlled substances once they were received from their California suppliers.According to a law enforcement affidavit filed in the case, authorities began investigating Edison in February of 2012 and subsequently made several controlled purchases of cocaine, crack cocaine, and ecstasy.
For their crimes, the defendants face a potential maximum penalty of 40 years in prison. Judge Frank will determine their sentences at a future hearing, yet to be scheduled.
This case is the result of an investigation by the U.S. Drug Enforcement Administration, the Minneapolis Police Department, and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant U.S. Attorney Jeffrey S. Paulsen.Man Who Threatened to Rob Bank with Explosives SentencedRead the Press Release
PHILADELPHIA - Dragos Ungurean, 30, of Wyomissing, PA, was sentenced today to 63 months in prison for attempting to rob the Wyomissing branch of M & T Bank. He pleaded guilty to the charge on June 27, 2012. On March 19, 2012, Ungurean walked into the bank, at 800 Penn Avenue in Wyomissing, threatened to blow up a bomb or explosive device attached to his person, and demanded money. Ungurean was subdued and handcuffed after a scuffle with an on-duty plain clothes investigator, George R. Bell, Jr., from the Wyomissing Police Department. The officer was utilizing the bank as a customer at the time of the attempted robbery. The bomb or explosive device was fake.
In addition to the prison term, U.S. District Court Judge Lawrence F. Stengel ordered three years of supervised release and a $1,000 fine. The judge also referred to the actions of investigator Bell as “heroic” for subduing the defendant on his own.
This case was investigated by the Federal Bureau of Investigation, Allentown, PA Resident Agency, the Wyomissing, Berks County Police Department, and the Berks County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Ewald Zittlau.
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Philadelphia, PA 19106COPIES OF NEWS MEMOS AND RELATED DOCUMENTS CAN ALSO BE FOUND AT HTTP://www.justice.gov/usao/pae
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
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PATTY HARTMAN, Media Contact, 215-861-8525Major New Jersey Hospital Pays $12.5 Million to Resolve Kickback AllegationsRead the Press Release
NEWARK, N.J. – The Cooper Health System has agreed with the U.S. Attorney’s Office for the District of New Jersey and the State of New Jersey to pay $12.6 million to settle allegations that it violated the federal False Claims Act and New Jersey False Claims Act by making improper payments to physicians under so-called “consulting” and “compensation” agreements as it sought to build its cardiology program.
U.S. Attorney Paul J. Fishman, Executive Assistant N.J. Attorney General John Hoffman, and Thomas O’Donnell, Special Agent in Charge of the U.S. Department of Health and Human Service's Office of Inspector General region that includes New Jersey, announced the settlement, which was unsealed today.
“Payments to outside physicians by hospitals require heightened scrutiny because those payments may be improper if they are based on patient referrals,” said U.S. Attorney Fishman. “Such kickback arrangements interfere with the physician-patient relationship and can lead to problems of overutilization and increased costs. Federal health care participants, such as Cooper, who run afoul of the prohibitions against kickbacks must be held responsible.”
“Cooper has taken responsibility for its past misconduct,” said Executive Assistant Attorney General Hoffman. Attorney General Jeffrey S. Chiesa is recused from the Cooper matter. “We commend Cooper for implementing substantial internal reforms and accountability measures designed to address the government's concerns and avoid any future transgressions."“People in Medicare and Medicaid should be confident that health providers are not being inappropriately influenced by financial gain," said Special Agent in Charge O’Donnell. “We will aggressively pursue all those who abuse Federal programs for personal gain.”
According to the results of the joint investigation:
The United States and New Jersey contend that from Oct. 1, 2004, through December 31, 2010, Cooper recruited local outside physicians to serve on the Cooper Heart Institute Advisory Board (“CHIAB”). Physicians were paid approximately $18,000 a year to attend four meetings over the course of any given year. The United States and New Jersey allege that at least one purpose of these payments was to induce the referral of patients to Cooper, that the payments did, in fact, induce such referrals to Cooper, and that Cooper’s subsequent billing of the Medicare and Medicaid programs for services resulting from those tainted referrals were in violation of federal and state anti-kickback and self-referral laws and thus, false claims.
The civil settlement agreement is between (1) the United States of America – acting through the United States Attorney’s Office for the District of New Jersey and on behalf of the Office of Inspector General of the United States Department of Health and Human Services (HHS OIG); (2) the State of New Jersey; and (3) the Cooper Health System. In resolution of the federal and state civil claims, Cooper has agreed to pay $10,200,000 to the United States and $2,300,000 to the State of New Jersey. Cooper has further enacted and agreed to maintain a number of corporate reforms designed to enhance accountability, training, and other aspects of its compliance operations.
The settlement resolves a False Claims Act suit by a physician who was recruited to take part in the CHIAB, but, instead, recognizing its potentially unlawful purpose, demurred and filed a whistleblower – “qui tam” – action. The qui tam provisions of both the federal and state False Claims Acts permit private individuals, known as relators, to file such actions and share in a portion of the proceeds recovered.
U.S. Attorney Fishman credited special agents of HHS OIG, under the direction of Special Agent in Charge O’Donnell, for the investigation leading to today’s settlement. Acting New Jersey Attorney General Hoffman also credited Deputy Attorney’s General Michelle Weiner and Lisa Kutlin for their handling of this matter.
The government is represented by Assistant U.S. Attorney David E. Dauenheimer of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, and Deputy Attorney General Samuel Cornish of the N.J. Attorney General’s OfficeThe claims settled by this agreement are allegations only; there have been no admissions of liability.
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Defense counsel: John M. Vazquez Esq., Michael Critchley Sr. Esq., both Roseland, N.J
Cooper Health Settlement Agreement
Cooper, Signed OrderLisle Man Admits to Serial Bank RobberiesRead the Press Release
Richard S. Hartunian, United States Attorney for the Northern District of New York; Peter J. Smith, United States Attorney, Middle District of Pennsylvania; George L. Piro, Acting Special Agent in Charge, Albany Division - Federal Bureau of Investigation; New York State Police Superintendent Joseph D’Amico; Joseph T. Zikuski, Chief, City of Binghamton Police Department; Carl Graziano, Acting Chief, City of Scranton Police Department; and, Larry Hurley, Chief, Athens Township Police Department, make the following announcement:
Samuel A. Parrotti, II, 44, of the Town of Lisle, Broome County, NY, admitted today in United States District Court, Binghamton, to committing a series of bank robberies last summer in Broome County, New York, Lackawanna County, Pennsylvania, and Bradford County, Pennsylvania. During his plea of guilty to four felony counts of bank robbery, Parrotti admitted to committing the following bank robberies in Broome County - the first, on July 16th, 2012, at the M&T Bank branch located at 1170 Vestal Avenue in the City of Binghamton; the second, on August 1st, 2012, at the NBT Bank branch located at 2950 State Route 11 in Whitney Point.
In addition, Parrotti admitted committing two other bank robberies similar to the Broome County robberies - one on August 6, 2012, at the Pennstar Bank branch located at 117 Meadow Avenue, Scranton, PA., and the other on August 27, 2012, at the Visions Federal Credit Union located at 2121 Elmira Street, Sayre, PA. In each of the four bank robberies, Parrotti indicated he possessed a gun, and passed notes to tellers demanding money. Parrotti obtained a total of approximately $38,000 between the four robberies.
Parrotti faces a maximum sentence of 20 years imprisonment, and a maximum fine of $250,000 dollars, on each of the four bank robberies. Parrotti is scheduled to be sentenced on May 23, 2013, by Senior U.S. District Court Judge Thomas J. McAvoy in United States District Court, Binghamton.
The case is being prosecuted by Assistant United States Attorney Thomas P. Walsh. Further inquiries may be directed to the United States Attorney’s Office, Binghamton branch office, at (607) 773-2887.
Lincoln County Man Indicted on Federal Child Pornography ChargesRead the Press Release
St. Louis, MO - Matthew M. Hansen was indicted for allegedly attempting to entice minor boys to engage in sexually explicit conduct for him to videotape between 2007 and 2012.
MATTHEW M. HANSEN, Winfield, MO, was indicted by a federal grand jury on eight felony counts of attempted production of child pornography and one felony count of possession of child pornography.
If convicted, each count of attempted production of child pornography carries a penalty range of 15 to 30 years in prison; possession carries a maximum penalty of ten years in prison and/or fines up to $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), and St. Charles County Cyber Crime Unit. Assistant United States Attorney Rob Livergood is handling the case for the U.S. Attorney’s Office.As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
Las Cruces Man Charged with Unlawful Production of Counterfeit Law Enforcement CredentialsRead the Press Release
ALBUQUERQUE – A federal grand jury sitting in Albuquerque, N.M., has indicted Richard A. Stack, 70, of Las Cruces, N.M., for unlawfully producing false identification documents. The indictment was announced by U.S. Attorney Kenneth J. Gonzales, Special Agent in Charge Carol K.O. Lee of the Albuquerque Division of the FBI, and Resident Agent in Charge Richard Ferretti of Albuquerque Resident Office of the U.S. Secret Service.
The three-count indictment, which was filed on Jan. 23, 2013, alleges that Stack unlawfully produced fraudulent law enforcement identification credentials that appeared to be issued by and under the authority of the U.S. Government. Stack is charged with unlawfully producing counterfeit Federal Air Marshal identification credentials on Jan. 6, 2012, and counterfeit U.S. Secret Service identification credentials on Jan. 9, 2012 and March 14, 2012. An arraignment date for Stack has yet to be scheduled.
“Counterfeit law enforcement credentials can be used by criminals, terrorists, and spies for illegal purposes, including penetrating our nation’s most secure government buildings, airports, and other facilities,” said Special Agent in Charge Lee of the FBI. “I would like to thank the U.S. Attorney's Office and the U.S. Secret Service for their assistance in this investigation. The FBI will continue to work aggressively with our law enforcement partners to investigate and prosecute those who put our national security and public safety at risk by making fake law enforcement badges and credentials available to those who might seek to abuse them."
“Richard Stack allegedly manufactured and sold counterfeit law enforcement credentials to an undercover U.S. Secret Service Agent,” said Resident Agent in Charge Ferretti of the U.S. Secret Service. “These fake credentials could have allowed an unauthorized subject to gain access to federally protected facilities or aircraft and thus erode the public's trust in law enforcement. We therefore must ensure that individuals like Stack are prosecuted and held accountable for their actions, if convicted.”
If convicted, Stack faces a maximum penalty of 15 years in prison and a $250,000 fine on each of the three charges in the indictment. Charges in indictments are merely accusations. All criminal defendants are presumed innocent unless proven guilty.
Assistant U.S. Attorney Jon K. Stanford is prosecuting the case. The investigation was conducted by the Las Cruces office of the FBI, and the Albuquerque Resident Office of the U.S. Secret Service. They were assisted by the New South Wales Police in Australia, the Boston Division of the FBI, the Norfolk Resident Office of the U.S. Secret Service, the U.S. Transportation Security Administration in Dallas, Texas and the Austin, Texas, Police Department.
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Indictment
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Ladybug Family Restaurant and Restaurant Employee Agree to Pay $62,000 to Resolve False Claims Act Allegations of Food Stamp FraudRead the Press Release
CHARLOTTE, N.C. – Ladybug Family Restaurant, Inc. and Retha Kendall Lindsey (“Defendants”) have agreed to pay $62,000 in damages and civil penalties to resolve allegations of food stamp fraud, announced Anne M. Tompkins, United States Attorney for the Western District of North Carolina.
U.S. Attorney Tompkins is joined in making today’s announcement by Karen Citizen-Wilcox, Special Agent in Charge, Office of the Inspector General, Office of Investigation of the U.S. Department of Agriculture (USDA-OIG).
On October 10, 2012, the United States filed a civil complaint against the Ladybug restaurant and Lindsey, who was employed by the restaurant, for violation of the United States False Claims Act. According to the filed complaint, the Defendants used other people’s Electronic Benefit Transaction (“EBT”) cards, formerly known as food stamps, to purchase food and other items for the Ladybug restaurants. The complaint alleged that from about August 2011 to about June 2012, the Defendants and others used EBT cards belonging to other people in at least 49 transactions to make bulk purchases of meat and other items for use at the Ladybug restaurants.
Today, the United States and Defendants submitted to the U.S. District Court a consent motion for a final order pursuant to which Defendants will pay $21,116.01 in damages and $40,883.99 in civil penalties under the False Claims Act. The proposed final judgment is subject to approval by a United States District Court Judge.
The Supplemental Nutrition Assistance Program (“SNAP”) provides assistance to low or no income individuals to allow them to purchase qualified food and nutrition items. Benefits are issued in the form of EBT cards similar to debit cards that can be swiped in a merchant’s credit card machine.
The civil action arose out of an investigation by the Inspector General’s Office of the U.S. Department of Agriculture, which administers the SNAP program. The False Claims Act allows the United States to recover triple the amount paid in fraudulent claims plus civil penalties of $5,000 to $11,000 per false claim. Each time an unauthorized party uses an EBT card constitutes a false claim to the United States subjecting the party to treble damages and civil penalties. The complaint in this case alleges that Defendants engaged in at least 49 fraudulent transactions. Each transaction is a false claim against the United States.
In making today’s announcement, U.S. Attorney Tompkins stated, “The SNAP program is in place to ensure that low income families and individuals are able to buy food staples to combat hunger and prevent malnutrition. Fraud on this program harms not only every American taxpayer but the vulnerable recipients who need it the most. My office will continue to use the False Claims Act to vigorously investigate and prosecute allegations of fraud on important government programs such as SNAP.”
Special Agent in Charge Citizen-Wilcox stated, “USDA-OIG aggressively investigates allegations of Supplemental Nutrition Assistance Program (SNAP) fraud with the goal of rooting out such activity to ensure that taxpayers’ funds are reserved for those who are truly in need. We would like to thank U.S. Attorney’s Office for their efforts in helping to combat SNAP fraud.”
The case was investigated by USDA-OIG. The prosecution was handled by Assistant United States Attorneys Paul B. Taylor and Jonathan H. Ferry of the U.S. Attorney’s Office for the Western District of North Carolina.
Jury Convicts Mountain View Man of Heroin SmugglingRead the Press Release
SAN JOSE, Calif. – Mike Gama was convicted by a federal jury Tuesday of both possession with intent to distribute a kilogram or more of heroin and importation of a kilogram or more of heroin , United States Attorney Melinda Haag announced.
The jury found that Gama had knowingly participated in a scheme to import heroin into the United States from Mexico when he accepted delivery of a package containing more than a kilogram of heroin concealed within a wooden tortilla press, and that he had possessed that heroin with the intent to distribute it to someone else. The guilty verdict followed a one-week jury trial before U.S. District Court Judge Edward J. Davila.
Evidence at trial showed that on June 20, 2011, Gama, 23, of Mountain View, Calif., received a package shipped from an address in Michoacan, Mexico via the commercial shipping company, DHL Express. The DHL package, which was addressed to him personally, contained, among other things, a wooden tortilla press containing 1.07 kilograms of a black tar-like substance, which subsequent lab testing confirmed as Mexican black tar heroin. Gama signed for the package and a search warrant was executed immediately thereafter to recover the package containing the heroin.
The DHL package addressed to Gama containing the heroin was first intercepted by Customs and Border Protection officers inspecting international shipments arriving at the DHL hub in Cincinnati, Ohio. HSI agents in San Jose were alerted to the package and were prepared to seize the package and the heroin when it arrived in California.
Gama was indicted by a federal grand jury on July 6, 2011. He was charged with one count of possession with intent to distribute a kilogram or more of heroin and one count of importation of a kilogram or more of heroin.
Following the guilty verdict, Gama, who had been free on bond pending trial, was remanded immediately into the custody of the United States Marshal Service. Gama’s sentencing is scheduled for April 15, 2013, before United States District Court Judge Edward J. Davila in San Jose. The maximum statutory penalty for each count in violation of Title 21 of the United States Code, Sections 841 and 952 is life in prison, with a statutory mandatory minimum term of 10 years in prison, and a maximum fine of $10 million. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Gary G. Fry and Amie D. Rooney are the Assistant U.S. Attorneys who are prosecuting the case with the assistance of Tracey Andersen and Laurie Worthen. The prosecution is the result of an 18-month investigation by U.S. Immigration and Customs Enforcement, Homeland Security Investigations and Customs and Border Protection.
Judge Sentences Former Bank Manager to 90 Months for Scheme That Closed Local Federal Credit UnionRead the Press Release
PHILADELPHIA - Ignacio Morales, a/k/a “Nacho,” 49, of Philadelphia, was sentenced today to 90 months in prison for conspiracy to defraud the government in a case that led to the closure of the Borinquen Federal Credit Union (BFCU). Morales used his position as the bank’s Manager to misuse and embezzle more than $2.3 million of BFCU funds through a variety of schemes, and between 2006 and June 2011, Morales further enriched himself by cashing hundreds of fraudulent U.S. tax refund checks through BFCU, keeping 20% of each check for himself as commission. Morales pleaded guilty September 4, 2012.
BFCU was a federal credit union in Philadelphia. Between 2008 and 2009, Morales embezzled $600,000 from BFCU to purchase real estate, and during the period of September through December 2009, he took $560,000 from BFCU to attempt to purchase 15 kilograms of cocaine. In September 2008, he failed to deposit $700,000 into an account of a BFCU member, and instead used the money for his own purposes. Morales also allowed a member of the BFCU board of directors to withdraw money from a BFCU account despite the absence of funds in the account resulting in a deficit of approximately $500,000. Morales then intentionally altered bank records and other reports provided to the National Credit Union Administration and their auditors in order to conceal his misuse of BFCU funds. In June 2011, the National Credit Union Administration took over the operation of the BFCU but closed the credit union within a month and liquidated its assets.
In addition to the conspiracy to defraud the government with respect to claims, Morales pleaded guilty to misapplication and embezzlement, false reports on federal credit institution entries, engaging in monetary transaction in property derived from specified unlawful activity, filing false federal income tax returns, and attempted possession with intent to distribute more than five kilograms of cocaine.
In addition to the prison term, U.S. District Court Judge R. Barclay Surrick ordered restitution to the National Credit Union Administration $2.3 million, restitution to the IRS $7,311,747.50, five years of supervised release, and a special assessment of $800.This case was investigated by the United States Postal Inspection Service, the Internal Revenue Service, and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Arlene D. Fisk.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Johnstown Man Pleads Guilty to Possessing Child PornographyRead the Press Release
JOHNSTOWN, Pa. - A resident of Johnstown, Pa., pleaded guilty in federal court to a charge of possession of child pornography, United States Attorney David J. Hickton announced today.
Austin J. Correll, 32, pleaded guilty to one count before United States District Judge Kim R. Gibson.
In connection with the guilty plea, the court was advised that on Jan. 24, 2011, Correll knowingly possessed pictures and videos in individual computer graphic files which were produced using minors engaging in sexually explicit conduct. The computer graphic files were shipped or transported in interstate or foreign commerce.
Judge Gibson scheduled sentencing for June 12, 2013, at 9:30 a.m. The law provides for a total sentence of ten years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.
Pending sentencing, the court continued Correll on bond.
Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.
Homeland Security Investigations conducted the investigation that led to the prosecution of Correll.
This case was brought as part of Project Safe Childhood. Launched in Feb. 2006, Project Safe Childhood is a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys’ Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
January Grand JuryRead the Press Release
United States Attorney Deborah R. Gilg announced the federal Grand Jury for the District of Nebraska has returned 32 indictments charging 32 defendants. Indictments are charging documents that contain one or more individual counts that are merely accusations, and every defendant is presumed innocent unless and until proven guilty.
* Juan Torres-Martinez, age 36, is charged in a three-count indictment. Count I of the indictment charges Torres-Martinez with misuse of a Social Security Number on or about May 12, 2009. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II of the indictment alleges on or about May 12, 2009, Torres-Martinez made a false statement and claimed to be a United States citizen with the intent to receive Federal and State benefits and to be employed in the United States. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count III charges that on or about May 12, 2009, Torres-Martinez misused a Social Security Card and a State of Kansas Identification Card knowing that said documents were not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Gilberto Acero-Garcia, age 38, of Fremont, Nebraska, is charged in a three-count indictment. Count I of the indictment charges Acero-Garcia with misuse of a Social Security Number on or about December 4, 2012. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Counts II and III charge that between on or about January 1, 2010, and up to and including January 16, 2013, and between January 1, 2011, and up to and including January 16, 2013, respectively, Acero-Garcia harbored illegal aliens in the United States for the purpose of commercial advantage and private gain, by employing the illegal aliens at DCS Sanitation Management, Inc. The maximum possible penalty for each count includes 10 years imprisonment, a $250,000 fine, a 3 year term of supervised release, and a $100 special assessment.
* Cory D. Allemang, age 38, of Clearwater, Nebraska, is charged in a three count indictment. Counts 1 and 2 of the indictment charge that on or about December 13, 2011, and between on or about November 2, 2011, and on or about January 6, 2012; respectively, Allemang sold approximately 300 pounds of sausages and approximately 400 pounds of beef jerky, by representing that the meat products had been inspected by the United States Department of Agriculture (USDA), when in fact, the meat products had not been inspected or passed by the USDA. The maximum penalty for each of these counts include imprisonment of 3 years, a fine of $250,000, 1 year supervised release, and a special assessment of $100. Count 3 of the indictment charges that on or about February 3, 2012, Allemang represented that various deer meat products had been inspected and passed by USDA, when in fact, the deer meat products had not been inspected or passed by USDA. The maximum penalty for this count includes imprisonment of 1 year, a fine of $100,000, 1 year supervised release, and a special assessment of $100.
* Jossue Gabriel Alva-Perez, age 19, of LaVista, is charged in the first count of an indictment with production of child pornography on or about January 3, 2013. The maximum possible penalty for this count includes imprisonment of not less than 15 years or more than 30 years, a $250,000 fine, 5 years of supervised release, and a $100 special assessment. Count II charges Alva-Perez with receipt and distribution of child pornography from on or about October 18, 2012, and continuing through January 8, 2013. If convicted, the maximum possible penalty includes imprisonment of not less than 5 years or more than 20 years, a fine of $250,000, supervised release for life, and a $100 special assessment. Alva-Perez is charged in Count III with possession of child pornography from on or about January 14, 2013. The maximum possible penalty for this count includes imprisonment of 10 years, a $250,000 fine, supervised release for life, and a $100 special assessment.
* Margarito Banuelos-Muro, age 38, of Mitchell, Nebraska, is charged with illegal reentry into the United States on or about December 12, 2012, following deportation as an aggravated felon. The maximum possible penalty if convicted includes imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Alex M. Castro-Funes, age 24, is charged with distributing 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine on or about October 15, 2012. The maximum possible penalty includes imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment.
* Mayra Cortes-Flores, age 31, of Omaha, is charged in a two-count indictment. Count I of the indictment charges Cortes-Flores with misuse of a Social Security Number on or about August 31, 2010. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II charges that on or about August 31, 2010, Cortes-Flores misused a Social Security Card and a Nebraska Identification Card knowing that said documents were not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Arnoldo Agustin Escarsega Mendez, age 25, of Omaha, is charged with illegal reentry into the United States on or about January 9, 2013, following deportation as a felon. The maximum possible penalty if convicted includes imprisonment of 10 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Daniel Galindo, age 18, is charged in a two count indictment. The Indictment alleges that on or about October 29, and November 7, 2012, the defendant distributed 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine. The maximum possible penalty for each count includes imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment.
* Victor Garcia-Ochoa, age 32, also known as Eduardo Najera-Gonzalez, of Grand Island, Nebraska, is charged with illegal reentry into the United States on or about December 12, 2012, following deportation as an aggravated felon. The maximum possible penalty if convicted includes imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Edgar Faustino Gonzalez-Garcia, age 25, is charged with illegal reentry into the United States on or about January 14, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* William G. Hallowell, age 27, of Walthill, Nebraska, is charged in a one-count indictment. Count I alleges that on or about July 7, 2012, Hallowell broke into a residence in Walthill, Nebraska, within the Omaha Indian Reservation, with the intent to steal electronic equipment and other property. The maximum penalty includes imprisonment of 10 years, a fine of $250,000, 3 years supervised release, and a special assessment of $100.
* Marquis Harrington, age 44, of Omaha, is charged with one count of mail fraud from on or about February 1, 2008. The indictment alleges Harrington fraudulently obtained housing assistance from the Douglas County Housing Authority by submitting an application that intentionally misrepresented the number of children living with him, his income, and his place of residence. The maximum possible penalty for this count includes imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count II of the indictment charges that on or about February 29, 2008, Harrington made a false statement to HUD. Harrington made a false statement for the purpose of obtaining a loan and advance of credit from JP Morgan Chase Bank, with the intent that this loan and advance be offered and accepted by HUD for insurance. The maximum possible penalty for this count includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Jose Hernandez-Leon, age 24, of Columbus, Nebraska, is charged with illegal reentry into the United States on or about December 13, 2012, following deportation as an aggravated felon. The maximum possible penalty if convicted includes imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Andres Hernandez-Martinez, is charged in a three-count indictment. Count I of the indictment charges Hernandez-Martinez with misuse of a Social Security Number on or about October 3, 2012. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II of the indictment alleges on or about October 3, 2012, Hernandez-Martinez made a false statement and claimed to be a United States citizen with the intent to receive Federal and State benefits and to be employed in the United States. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count III charges that on or about October 3, 2012, Hernandez-Martinez misused a Social Security Card and a State of Texas Identification Card knowing that said documents were not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Victor Ibanez-Barragan, age 33, of Omaha, is charged in a two-count indictment. Count I of the indictment charges Ibanez-Barragan with misuse of a Social Security Number on or about June 28, 2011. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II charges that on or about June 28, 2011, Ibanez-Barragan misused a Social Security Card knowing that said document was not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Juan Jimenez-Ruiz, age 27, is charged in a three-count indictment. Count I of the indictment charges Jimenez-Ruiz with misuse of a Social Security Number on or about August 2, 2009. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II of the indictment alleges on or about August 2, 2009, Jimenez-Ruiz made a false statement and claimed to be a United States citizen with the intent to receive Federal and State benefits and to be employed in the United States. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count III charges that on or about August 2, 2009, Jimenez-Ruiz misused a Social Security Card and a State of Kansas Identification Card knowing that said documents were not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Luis Jordan, age 36, of Grand Island, is charged in a three count indictment. Counts I and II allege the defendant distributed 5 grams or more of actual methamphetamine on or about November 4, and November 8, 2011. The maximum possible penalty for each count includes imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment. Count III alleges that on or about October 20, 2012, the defendant possessed with intent to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine. The maximum possible penalty includes imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment.
* Ryan Keiter, age 25, of Lincoln, is charged in the first count of an indictment with receipt and distribution of child pornography from at least on or about October 24, 2008, and continuing to on or about April 13, 2012. If convicted, the maximum possible penalty includes imprisonment of not less than 5 years or more than 20 years, a fine of $250,000, supervised release for life, and a $100 special assessment. Keiter is charged in Count II with possession of child pornography from on or about April 13, 2012. The maximum possible penalty for this count includes imprisonment of 10 years, a $250,000 fine, supervised release for life, and a $100 special assessment. The indictment also alleges that property used or intended to be used as part of these violations should be forfeited to the United States.
* Christopher Lewis, is charged with possession with intent to distribute 5 grams or more of actual methamphetamine on or about November 5, 2012. The maximum possible penalty includes imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment. The indictment also alleges any and all property constituting or derived from any proceeds obtained directly or indirectly as a result of the violation alleged in the indictment, including but not limited to $848.00 in United States currency seized from the defendant on November 5, 2012, should be forfeited to the United States.
* Carlos Linares-Valmores, age 27, is charged in a four-count indictment. Count I of the indictment charges Linares-Valmores with misuse of a Social Security Number on or about August 9, 2012. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II of the indictment alleges on or about August 9, 2012, Linares-Valmores made a false statement and claimed to be a United States citizen with the intent to receive Federal and State benefits and to be employed in the United States. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count III charges that on or about August 9, 2012, Linares-Valmores misused a Social Security Card and a State of Iowa Identification Card knowing that said documents were not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count IV of the indictment charges Linares-Valmores with illegal reentry into the United States on or about January 17, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Juan Luna-Ochoa, age 32, of Omaha, is charged with illegal reentry into the United States on or about December 14, 2012, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Darrin L. Mallatt, age 30, of Lincoln, is charged in the first count of an indictment with receipt and distribution of child pornography from at least on or about October 8, 2008, and continuing to on or about December 3, 2012. If convicted, the maximum possible penalty includes imprisonment of not less than 5 years or more than 20 years, a fine of $250,000, supervised release for life, and a $100 special assessment. Mallatt is charged in Count II with possession of child pornography from on or about December 3, 2012. The maximum possible penalty for this count includes imprisonment of 10 years, a $250,000 fine, supervised release for life, and a $100 special assessment.
* Omar Manuel-Marcial, age 24, of Omaha, is charged with illegal reentry into the United States on or about January 1, 2013, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Rolando Mejia-Mendez, age 25, of Wakefield, Nebraska, is charged with illegal reentry into the United States on or about November 7, 2012, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Ismael Pena-Velazquez, age 35, of Omaha, is charged with illegal reentry into the United States on or about December 14, 2012, after deportation or removal. The maximum possible penalty if convicted includes imprisonment of 2 years, a $250,000 fine, 1 year of supervised release, and a $100 special assessment.
* Nick Reams, age 55, of St Paul, Nebraska, is charged with possession with intent to distribute 5 grams or more of actual methamphetamine on or about August 24, 2012. The maximum possible penalty includes imprisonment of not less than 5 years and up to 40 years, a $5 million fine, a 5 year term of supervised release and a $100 special assessment.
* Ricardo Reyes, age 33, of Omaha, is charged in the first count of an indictment with receipt and distribution of child pornography from on or about October 11, 2012, and continuing through January 15, 2013. If convicted, the maximum possible penalty includes imprisonment of not less than 5 years or more than 20 years, a fine of $250,000, supervised release for life, and a $100 special assessment. Reyes is charged in Count II with possession of child pornography from on or before January 13, 2013. The maximum possible penalty for this count includes imprisonment of 10 years, a $250,000 fine, supervised release for life, and a $100 special assessment.
* Jose Roman-Felix, age 27, of Omaha, is charged with illegal reentry into the United States on or about January 4, 2013, following deportation as an aggravated felon. The maximum possible penalty if convicted includes imprisonment of 20 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Valentin Ruiz-Cajiga, age 28, is charged in a three-count indictment. Count I of the indictment charges Ruiz-Cajiga with misuse of a Social Security Number on or about September 6, 2012. The maximum penalty for this count includes imprisonment of 5 years, a fine of $250,000, followed by a term of supervised release of 3 years, and a special assessment of $100. Count II of the indictment alleges on or about September 6, 2012, Ruiz-Cajiga made a false statement and claimed to be a United States citizen with the intent to receive Federal and State benefits and to be employed in the United States. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment. Count III charges that on or about September 6, 2012, Ruiz-Cajiga misused a Social Security Card and a State of Colorado Identification Card knowing that said documents were not issued lawfully for his use. The maximum possible penalty for this count includes imprisonment of 5 years, a $250,000 fine, 3 years of supervised release, and a $100 special assessment.
* Santiago J. Tijerina, also known as Jimmy Ostos or Samuel Jimmy Ostos, of Lexington, Nebraska, is charged with failure to register as a Sex Offender in the State of Nebraska from between April, 2012, and December 22, 2012. The maximum penalty for this count includes imprisonment of 10 years, a $250,000 fine, a term of supervised release for life, and a special assessment of $100.
* Todd Tingelhoff, age 46, of Omaha, is charged with possession with intent to distribute 50 grams or more of actual methamphetamine on or about December 27, 2012. The maximum possible penalty includes imprisonment of not less than 10 years and up to life years, a $10 million fine, a 5 year term of supervised release and a $100 special assessment. The indictment also alleges any and all property constituting or derived from any proceeds obtained directly or indirectly as a result of the violation alleged in the indictment, including but not limited to $800.00 in United States currency seized from the defendant’s wallet and $7,705.00 in United States currency seized from a lockbox in the defendant’s vehicle, should be forfeited to the United States.Informational: Federal Court ArraignmentsRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on January 24, 2013, before U.S. Magistrate Judge Keith Strong, the following individuals were arraigned:
CASEY LEE MARTIN, a 31-year-old resident of Hays, appeared on a charge of assault with a dangerous weapon. He is currently detained. If convicted of this charge, MARTIN faces possible penalties of 10 years in prison, a $250,000 fine, and 3 years supervised release. Assistant U.S. Attorney Jessica A. Betley is the prosecutor for the United States. The investigation was conducted by the Federal Bureau of Investigation.
MARK EDWIN ABRESCH, a 54-year-old resident of Great Falls, appeared on charges of conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute methamphetamine, and distribution of methamphetamine. He is currently detained. If convicted of these charges, ABRESCH faces possible penalties of a mandatory minimum of 10 years in prison and could be sentenced to life, a $5,000,000 fine, and 5 years supervised release. Assistant U.S. Attorney Jessica A. Betley is the prosecutor for the United States. The investigation was conducted by the Drug Enforcement Administration.
The defendants pled not guilty to the charges.
The charge, an indictment, information or complaint, is merely an accusation and all persons named as defendants are presumed innocent until proven guilty. A pre-trial conference and a trial date will be set and the United States will be required to prove the allegations set forth in the indictment beyond a reasonable doubt.
Informational: Federal Court ArraignmentRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on January 24, 2013, before U.S. Magistrate Judge Jeremiah C. Lynch, the following individual was arraigned:
COLEEN FURTHMYRE, a 46-year-old resident of Helena (formerly of Anaconda), appeared on charges of wire fraud and theft of government money. She is currently released on special conditions. If convicted of these charges, FURTHMYRE faces possible penalties of 20 years in prison, a $250,000 fine, and 3 years supervised release. Assistant U.S. Attorney Timothy J. Racicot is the prosecutor for the United States. The investigation was a cooperative effort between the U.S. Secret Service and the U.S. Department of Health and Human Services - Office of Inspector General.
The defendant pled not guilty to the charges.
The charge, an indictment, information or complaint, is merely an accusation and all persons named as defendants are presumed innocent until proven guilty. A pre-trial conference and a trial date will be set and the United States will be required to prove the allegations set forth in the indictment beyond a reasonable doubt.
Individual Pleads Guilty to ID Fraud and Impersonating an OSHA Official in Wake of Gulf Oil SpillRead the Press Release
Connie M. Knight, 46, previously of Belle Chasse, La., pleaded guilty in federal court in New Orleans today to three felony criminal charges and one misdemeanor criminal charge for creating false identification documents an impersonating a federal official, announced Ignacia S. Moreno, Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division, and Dana Boente, U.S. Attorney for the Eastern District of Louisiana.
According to the plea agreement, in the wake of the Deepwater Horizon oil spill, Knight impersonated a high-ranking Occupational Safety and Health Administration (OSHA) hazardous waste safety instructor and inspector in order to collect money from individuals who hoped to work on the cleanup effort that followed the spill. The plea agreement describes Knight’s methods, which included creating a false federal identification badge declaring that she was an “OSHA Master Level V Instructor and Inspector.” In reality, OSHA has no such designation. Knight also created false federal identification badges for her employees, who believed that they were working for OSHA. The employees were residents of Southeast Asian fishing communities in Southern Louisiana, and provided Knight a way to access those communities.
From the time of the spill through the end of 2010, many fisheries were closed and Gulf fishermen were seeking other means of employment. Knight held fake OSHA training seminars and assured attendees that they would receive lucrative employment working on the Deepwater Horizon oil spill cleanup once they paid for and completed her course. Knight did not, however, actually have any connection to the cleanup effort.
Court documents also describe the training seminars themselves. Knight required each attendee to pay between $150 and $400 cash to enter a class. She claimed her classes satisfied the various safety requirements that all individuals were to complete in order to be employed at a Deepwater Horizon hazardous waste cleanup site. Knight’s classes lasted as little as two hours, while the legitimate certifications would take at least six days of classroom training and three days of on-site training. Though many of her attendees were Vietnamese, Laotian or Cambodian, Knight spoke only English at the classes, and all materials were in English. At least some attendees later gained access to hazardous waste cleanup sites based on the fraudulent certifications created by Knight.
Producing fraudulent federal identification documents carries a maximum sentence of 15 years in prison and a fine of $250,000. Possessing a fraudulent federal identification document carries a maximum sentence of one year in prison and a fine of $100,000. The two counts of falsely impersonating a federal employee each carry a maximum sentence of three years in prison and a fine of $250,000.
This case was investigated by the U.S. Department of Labor Office of Inspector General and the U.S. Environmental Protection Agency Criminal Investigation Division, with assistance from the Occupational Safety and Health Administration, the FBI, and investigators from the Florida Fish and Wildlife Conservation Commission and the Plaquemines Parish, La., Sheriff’s office.
The case is being prosecuted by Patrick M. Duggan of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division and Emily Greenfield of the U.S. Attorney’s Office for the Eastern District of Louisiana.
Indictment: Credit Counseling Firm Laundered Cash from Marijuana TraffickingRead the Press Release
KANSAS CITY, KAN. – Two people have been charged with laundering cash from marijuana trafficking through a non-profit credit counseling agency in Kansas City, U.S. Attorney Barry Grissom said today.
Mendy Read-Forbes, 37, Platte City, Mo., and Laura Shoop, 46, Platte City, Mo., are charged in a superseding indictment with one count of conspiracy to commit money laundering, one count of conspiracy to possess with intent to distribute marijuana and one count of possession with intent to distribute marijuana. In addition, Read-Forbes is charged with 16 counts of money laundering and Shoop is charged with eight counts of money laundering.
The indictment alleges that Forbes and Newhard Credit Solutions was registered as a nonprofit organization that provided credit counseling services to people who were in bankruptcy proceedings. Forbes held herself out as the owner and operator of the agency. Shoop was an acquaintance of Forbes who worked at various times for the agency.
In March and April 2012, Forbes was introduced to an undercover officer posing as a marijuana dealer. Forbes offered to devise a scheme to launder the dealer’s drug proceeds. As part of the scheme, Forbes offered to deposit money given to her by the drug dealer into the bank accounts of Forbes and Newhard Credit Solutions or related companies and then to return the money to the dealer via checks, money orders or wire transfers. The bank accounts were in Kansas.
To make the transactions appear legitimate, Forbes gave the drug dealer a contract titled “Purchase and Sale of Business Agreement.” The contract, bearing the signature of the drug dealer and another person known to the grand jury, made it appear that the marijuana dealer was purchasing assets of FCP, Inc., a corporation controlled by Forbes and another person.
To make it appear that the drug dealer was engaged in business as a certified credit counselor with Forbes and Newhard Credit Solutions, Forbes gave the drug dealer a certificate saying he had completed training as a bankruptcy specialist.
In addition, Forbes created a company called Maximum Lawn Care, LLC, and opened bank accounts where cash from the drug dealer was deposited.
Forbes agreed not to charge a fee for laundering the drug dealer’s money until she had laundered $170,000 so that the dealer could use the funds to purchase more marijuana. Forbes also agreed to let the drug dealer store 40 pounds of marijuana at her house.
If convicted, they face a maximum penalty of 20 years and a fine up to $250,000 on the charge of conspiracy to commit money laundering and each of the money laundering counts; and a maximum penalty of five years and a fine up to $250,000 on each of the two marijuana counts.
The Kansas Bureau of Investigation, the U.S. Secret Service, the Internal Revenue Service and the Department of Housing and Urban Development investigated. Assistant U.S. Attorney Chris Oakley and Assistant U.S. Attorney Jabari Wamble are prosecuting.
OTHER INDICTMENTS
Sean C. Costa, 24, Wichita, Kan., is charged with one count of unlawful possession of a firearm after a felony conviction. The crime is alleged to have occurred Jan. 9, 2012, in Wichita, Kan.
Costa initially was charged in a criminal complaint filed Jan. 17 in U.S. District Court in Wichita. The complaint alleged that on Jan. 9 the Wichita Police Department was called to a report of shots fired at the McDonald’s restaurant at 6350 W. Kellogg in Wichita. The victims reported that the disturbance had begun when another car tried to cut in front of them in the drive thru. They said a male in the other car had stepped out of the vehicle and fired a shotgun at them. The blast struck the post between the driver’s side front and back doors of the victims’ car.
While investigating the case, Wichita police officers served a search warrant at 2440 Newell in Wichita. Costa was arrested and police recovered a Mossberg pump action shotgun from a crawl space next to Costa’s bed. Costa denied shooting the gun at McDonald’s.
Because had a prior felony conviction on a charge of aggravated assault in 2011 he was prohibited from possessing a firearm under federal law.
If convicted, he faces a maximum penalty 10 years in federal prison and a fine up to $250,000. Assistant U.S. Attorney Matt Treaster is prosecuting.
Carin Leon-Pacheco, 38, who is not a citizen of the United States, is charged with unlawfully re-entering the United States after being convicted of a felony an deported. He was found Sept. 25, 2012, in Wyandotte County, Kan.
If convicted, he faces a maximum penalty of 10 years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Sheri McCracken is prosecuting.
Brandon Milhouse, 27, Overland Park, Kan., is charged with possession of 43 counterfeit $100 bills and nine counterfeit $20 bills. The crime is alleged to have occurred Nov. 27, 2012, in Johnson County, Kan.
If convicted, he faces a maximum penalty of 25 years in federal prison and a fine up to $250,000. The U.S. Secret Service investigated. Assistant U.S. Attorney Jabari Wamble is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Indictment Alleges Social Security ScamRead the Press Release
Raylene Wilson, 43, of Salisbury, Maryland, was charged today by Indictment with one count of identity theft and one count of using a false Social Security number, announced United States Attorney Zane David Memeger.
If convicted, Wilson faces a maximum possible sentence of 20 years in prison; a $500,000 fine; three years of supervised release; and a $200 special assessment.
The case was investigated by the United States Postal Inspection Service, the Social Security Administration’s Office of Inspector General, and Westtown-East Goshen Police Department and is being prosecuted by Assistant United States Attorney Vineet Gauri.
Click here to view the indictment
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Houston Man Sentenced for Health Care FraudRead the Press Release
More than $600,000 stolen from Medicare based on false claims
SHREVEPORT, La: United States Attorney Stephanie A. Finley announced today that Godspower Joseph Essang, 35, of Houston, Texas, was sentenced today, to 37 months in federal prison with three years supervised release for Medicare fraud.
Essang was also ordered to pay $613,096 in restitution to Medicare. Judge Maurice S. Hicks immediately remanded Essang into the custody of the U. S. Marshal’s Service to begin serving his sentence.
Essang was sentenced based on his Sept. 28, 2012, guilty plea to one count of health care fraud. During the guilty plea hearing, Essang admitted owning and operating Shalom Equipment, a durable medical equipment company, located on Woodward Avenue in Shreveport. Shalom engaged in the business of providing what were referred to as “ortho kits,” which were braces for various parts of the body. Essang admitted paying individuals to provide him with their Medicare beneficiaries and physicians information. He then used this identifying information to file false claims with Medicare for providing the “ortho kits”
to Medicare beneficiaries who did not need, were not prescribed and/or did not receive the items. Essang admitted that between Aug. 12, 2007 and Oct. 21, 2008, he filed approximately 736 claims, billing Medicare for $1,223,255. Medicare actually paid out $613,096 on the claims.“Mr. Essang’s scheme was designed to defraud a program whose sole purpose is providing medical services to the elderly and the disabled,” U.S. Attorney Stephanie A. Finley stated. “His actions defrauded the program and, ultimately, U.S. taxpayers. This office will continue to vigorously pursue charges against those who steal from such programs.”
“Durable medical equipment fraud is a major problem that costs taxpayers billions in lost and wasted dollars,” said William W. Root, Assistant Special Agent in Charge, U.S. Department of Health and Human Services. “Today’s sentencing is the culmination of a concerted and joint effort by our Inspector General’s Office, the U.S. Attorney’s Office and the Federal Bureau of Investigation to quickly bring to justice those who prey on our elderly for financial gain.”
The FBI and the U. S. Department of Health and Human Services, Office of the Inspector General, conducted the investigation. Assistant U.S. Attorney C. Mignonne Griffing prosecuted the case.
Heroin Trafficker Sentenced to More Than 10 Years in Federal PrisonRead the Press Release
January 24, 2013David B. Fein, United States Attorney for the District of Connecticut, announced that JUAN RUANO, 49, a citizen of Guatemala last residing in Stamford, was sentenced today by United States District Judge Janet C. Hall in New Haven to 130 months of imprisonment, followed by five years of supervised release, for trafficking heroin.
According to court documents and statements made in court, on December 19, 2011, RUANO and his wife, Saira Ruano, were arrested in the parking lot of a Windsor Locks hotel moments after taking delivery of luggage containing approximately 11 kilograms of heroin. The heroin was secreted in 15 cans marked as refried beans that had been smuggled into the United States from Guatemala City, Guatemala. A search of RUANO’s car revealed a black plastic trash bag containing $18,000 in cash intended for other members of the conspiracy who arranged the transport the heroin.
Subsequent investigation revealed that from approximately May 2010 through December 2011, more than $200,000 in currency exchanges were transacted on joint back accounts owned by RUANO and his wife.
RUANO has been detained since his arrest on December 19, 2011. On September 28, 2012, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, one kilogram or more of heroin.
RUANO has forfeited the $18,000 seized at the time of his arrest.
On December 4, 2012, Saira Ruano pleaded guilty to structuring financial transactions to avoid currency reporting requirements. She awaits sentencing.
This matter has been investigated by the U.S. Department of Homeland Security’s Homeland Security Investigations and Customs and Border Protection, with the assistance of the Drug Enforcement Administration.
The case is being prosecuted by Assistant United States Attorney Brian P. Leaming.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Hayward Tax Preparer Pleads Guilty to Tax FraudRead the Press Release
Oakland, Calif. – Naushad Buksh today pleaded guilty to filing a false tax return and aiding and assisting in the preparation of false tax returns, United States Attorney Melinda Haag and Internal Revenue Service Criminal Investigation (IRS-CI) Special Agent in Charge Jose M. Martinez announced.
According to his plea agreement, Buksh has prepared tax returns for approximately 20 years. During 2007, 2008, 2009 and 2010, he operated a tax return preparation business in Hayward, Calif., and was responsible for all income and expenses at that business. Buksh intentionally signed and filed with the IRS false U.S. Individual Income Tax Returns for 2007 through 2010, which underreported his gross receipts by $599,226 and resulted in a tax loss of $160,528.
Buksh admitted in his plea that, in addition to filing false returns for himself, he also prepared tax returns on behalf of his clients that included false deductions and credits for the purpose of creating fraudulent tax refunds. Buksh knew the deductions and credits were false because he fabricated them. Some of the false deductions and credits included home mortgage interest and points, unreimbursed employee expenses, inflated education credits, student loan interest and/or tuition fee deductions, false personal property tax deductions, and false or inflated tax preparation fees.
Buksh, 56, of Hayward, Calif., was charged on May 15, 2012, with four counts of making and subscribing false tax returns and 41 counts of aiding and assisting in the preparation of false tax returns. He pleaded guilty to one count of each. Buksh is next scheduled to appear in federal court in Oakland at 2 p.m. on April 11 for sentencing before United States District Court Judge Yvonne Gonzalez Rogers.
The maximum statutory penalty for each count of making and subscribing to a false income tax return, in violation of Title 26, U.S.C § 7206(1), and aiding and assisting in the preparing of false tax returns, in violation of Title 26, U.S.C § 7206(2), is three years in prison and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Thomas Moore is the Assistant U.S. Attorney who is prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
Gainesville Woman Sentenced to Federal Prison on Identity Theft and Fraud ChargesRead the Press Release
Jacksonville, FL - U.S. District Judge Timothy J. Corrigan sentenced Regina Ward (31, Gainesville) yesterday to 13 months’ imprisonment for charges related to identity theft, fraud against the United States, and Treasury check fraud. Ward was also ordered to serve a 3-year term of supervised release following her incarceration, and to pay restitution to the Internal Revenue Service in the amount of $6,500.According to court documents, in February 2012, Ward met with an undercover agent (UC) posing as an individual willing and capable of cashing United States Treasury checks without proper identification. Ward presented the UC with a Treasury check in the amount of $12,727.81, in the name of another individual. Ward negotiated a check cashing fee with the UC and advised that she had other checks that she needed to cash. Ward sold the Treasury check to the UC for $6,500.
Later that same month, Ward met with the UC again and attempted to cash two additional Treasury checks. During the meeting, Ward sold ten stolen identities for the purpose of filing fraudulent federal income tax returns. Specifically, Ward provided names, social security numbers and dates of birth for ten individuals. She also provided drivers’ license numbers and Turbo Tax pin numbers from prior years for some of the individuals. She sold these identities for $850 each.
The case was investigated by Internal Revenue Service Criminal Investigation. It was prosecuted by Assistant United States Attorney Kelly S. Karase.
Four Sentenced to Prison in Florida<br /> 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 today 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 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; 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.
Four Nebraskans Indicted for Structuring Currency TransactionsRead the Press Release
United States Attorney Deborah R. Gilg and Tanya T. Brewer, Acting Special Agent in Charge of IRS Criminal Investigation, announced that four Nebraskans were indicted for structuring financial transactions in an effort to defeat legal reporting requirements imposed on financial institutions. “Structuring” refers to the manipulation of cash transactions for the purpose of preventing a financial institution from filing certain reports. For example, federal law requires financial institutions, credit unions, casinos and money service businesses to file a Currency Transaction Report with the Internal Revenue Service whenever a person deposits more than $10,000.00 in cash. The purpose of the law prohibiting structured deposits is to help identify suspicious cash transactions that might be indicative of other criminal activity. A person engaged in structuring might break up a cache of currency in excess of $10,000.00 into multiple deposits for the purpose of keeping the institution from filing the required report. The four individuals indicted by the Grand Jury, in separate and unrelated cases, are as follows:
Peter V. Bristol, age 51 of Omaha, is charged in a 13-count indictment. In Counts 1 through 12 it is alleged that on various dates from on or about May 8, 2009, through on or about April 24, 2011, Bristol structured financial transactions to evade reporting requirements when he made deposits in the amount of approximately $131,504.00 to Security National Bank. Count 13 charges Bristol with structuring financial transactions to evade reporting requirements when he conducted approximately 93 transactions from on or about February 2, 2009, to on or about November 12, 2012, to Security National Bank, in the amount of approximately $878,897.00.
Randy L. Evans, age 59 of Grand Island, is charged in a 15-count indictment. In Counts 1 through 14 it is alleged that on various dates from on or about March 29, 2010, through on or about December 27, 2011, Evans structured financial transactions to evade reporting requirements when he made deposits in the amount of approximately $210,381.00 to Five Points Bank. Count 15 charges Evans with structuring financial transactions to evade reporting requirements when he conducted approximately 449 transactions from on or about January 4, 2010, to on or about February 28, 2012, to Five Points Bank, in the amount of approximately $2,030,322.00.
Arturo W. Torres, age 35 of Bellevue, is charged in a three-count indictment. In Counts 1 and 2 it is alleged that on or about January 6, 2011, and February 24, 2011, respectively, Torres structured financial transactions to evade reporting requirements when he made deposits in the amount of approximately $19,360.00 to First National Bank. Count 3 charges Torres with structuring financial transactions to evade reporting requirements when he conducted approximately 177 transactions from on or about February 6, 2010, to on or about January 31, 2012, to the First National Bank of Omaha, in the amount of approximately $631,289. 00.
Irma Crispin-Gomez, age 41 of Grand Island, is charged in a 16-count indictment. In Counts 1 through 15 it is alleged that on various dates from on or about June 27, 2009, through on or about March 19, 2012, Crispin-Gomez structured financial transactions to evade reporting requirements when she made deposits in the amount of approximately $247,800.00 to Five Points Bank. Count 16 charges Crispin-Gomez with structuring financial transactions to evade reporting requirements when she conducted approximately 423 transactions from on or about January 5, 2009, through on or about March 30, 2012, to Five Points Bank and Wells Fargo Bank, in the amount of approximately $2,082,338.00.
All the counts in all four indictments are punishable by imprisonment of up to 5 years, a fine of up to $250,000.00, or both, to be followed by up to 3 years of supervised release, and a $100 special assessment.
“The structuring of currency is an avenue used by individuals and businesses to conceal the true source of their money,” said Tanya T. Brewer, Acting Special Agent in Charge of IRS Criminal Investigation. “Information from currency reports filed with the IRS provides a paper trail or roadmap for investigations of financial crimes and illegal activities.”
“Financial crimes, especially structuring, are oftentimes a method used to evade payment of taxes lawfully owed to the United States. We will continue to aggressively pursue these crimes in order to protect the millions of Americans that lawfully comply with our tax laws,” according to United States Attorney Deborah R. Gilg
An indictment is merely an accusation and the defendants are presumed innocent until and unless proven guilty.
Four Mid-State Men Indicted for Operating an Illegal Cockfighting EnterpriseRead the Press Release
Howard Gay, 55, of Hohenwald, Tenn., Thomas Hardiman, 64, of Iron City, Tenn., Walter Wooten, 57, of Leoma, Tenn., and Phillip Heidekker, 66 of Bon Aqua, Tenn., were indicted by a federal grand jury on January 17, 2013, and were each charged with three counts relating to their participation in a cockfighting enterprise known as the “Shiloh Club” in Hohenwald, Tenn., announced Jerry E. Martin, U.S. Attorney for the Middle District of Tennessee.
An indictment is merely an accusation and is not evidence of guilt. Defendants are presumed innocent unless and until proven guilty in a court of law.
The indictment charges each defendant with operating an illegal gambling business, conspiring to operate an illegal gambling business and aiding and abetting an animal fighting venture.
“Cockfighting is a shockingly vicious and cruel pursuit that is illegal in Tennessee and almost always involves illegal gambling,” said U.S. Attorney Jerry Martin. “Leaders of organizations that exist to profit on illegal gambling and other illegal enterprises should expect to face federal prosecution whenever federal statutes are violated.”
According to the indictment, the Shiloh Club had been in operation for more than a generation and had hosted cockfighting derbies every other Saturday between November 2008 and May 2009. The defendants operated and worked for the Shiloh Club and hosted and participated in cockfighting derbies that involved fights between roosters brought from Tennessee and other states.
The defendants facilitated widespread gambling on the outcome of the cockfights in the form of entry fees as well as side bets among spectators. Through the collection of admission fees and entry fees, as well as from the sale of concessions and cockfighting paraphernalia, the defendants made a significant profit. During one cockfighting derby alone, more than $12,300 in entry fees were paid to the Shiloh Club.
In May 2009 federal and state law enforcement executed a federal search warrant at the Shiloh Club and more than 200 individuals were subsequently prosecuted on state charges for being spectators at the cockfight and for gambling and other charges.
If convicted, the defendants each face up to five years in prison and a $250,000 fine, as well as forfeiture of property derived from or used in violation the offenses charged.
The case was investigated by agents with the U.S. Department of Agriculture- Office of Inspector General and the Tennessee Bureau of Investigation, with valuable assistance from the Tennessee Highway Patrol, the Federal Bureau of Investigation, the Williamson County Sherriff’s Department, and the 21st Judicial District Attorney General’s Office. The United States is represented by Assistant U.S. Attorney William F. Abely.Four Indicted for Filing False Federal Income Tax ReturnsRead the Press Release
Four individuals were indicted by a federal grand jury and charged with making and subscribing false federal income tax returns, 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 3 years in prison, a $250,000 fine and restitution for the amount of the tax loss.
Anaya Bluiett, 25, of Brooklyn, IL, was charged with three counts of making and subscribing false federal income tax returns for the years 2008, 2009, and 2010.
Terri M. Boatmans, 45, of Belleville, IL, was charged with two counts of making and subscribing false federal income tax returns for the years 2009 and 2010.
Demetrius L. Combs, 21, of East St. Louis, IL, was charged with one count of making and subscribing false federal income tax return for the year 2010.
Gemarian Douglas, 37, of Alorton, IL, was charged with one count of making and subscribing false federal income tax return for the year 2009.
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 Internal Revenue Service/Criminal Investigations. The prosecution is being handled by Assistant U.S. Attorney Norman R. Smith.
To report criminal tax fraud call the I.R.S. Criminal Investigations at (618) 622-2160 or by sending the information to the Internal Revenue Service, Fresno, CA 93888.
Four Co-Conspirators Plead Guilty to Federal Drug Trafficking, Money Laundering ChargesRead the Press Release
To Date, 13 Defendants Have Pleaded Guilty in the Case
POCATELLO – Four more members of an Idaho Falls area drug trafficking organization pleaded guilty in United States District Court in Pocatello, U.S. Attorney Wendy J. Olson announced.
Isidoro David Herrera, 31, of Idaho Falls, Idaho, pleaded guilty on Wednesday to conspiracy to possess with intent to distribute in excess of 50 grams of methamphetamine. The charge is punishable by a minimum term of ten years up to life in prison, a maximum fine of $10 million, and at least five years of supervised release.
Alberto Abarca, 22, of Idaho Falls, pleaded guilty on Wednesday to possession with intent to distribute methamphetamine. Nicolas Levi Olsen, 29, of Idaho Falls, Idaho, pleaded guilty today to aiding and abetting the possession of methamphetamine with intent to distribute. The charges are punishable by up to 20 years in prison, a maximum fine of $1 million, and at least three years of supervised release.
Ana Rosa Valdez-Ceja, 26, of Shelley, Idaho, pleaded guilty on Wednesday to money laundering, which is punishable by up to 20 years in prison, a maximum fine of $500,000, and up to three years of supervised release.
According to the plea agreements, from June 2005 through January 2012, a group of individuals centered around co-defendant Samuel Nevarez-Ayon entered into a conspiracy to possess and distribute in excess of 50 grams of actual methamphetamine in the Idaho Falls area. In furtherance of the conspiracy, Nevarez-Ayon admitted that he distributed methamphetamine to other individuals on at least three occasions during this same time period. In furtherance of the conspiracy, Nevarez-Ayon directed activities of various co-defendants. In addition to distributing methamphetamine, several defendants laundered proceeds from the sale of the methamphetamine, and made false loan application to local banks to further the laundering of money. During the course of the conspiracy, the defendants obtained in excess of $500,000 from the distribution of methamphetamine. The government is seeking forfeiture of assets derived from the criminal offenses.
Abarca and Valdez-Ceja are scheduled to be sentenced on April 29, and Herrera and Olsen on April 30, 2013, before Chief U.S. District Judge B. Lynn Winmill at the federal courthouse in Pocatello.
Nine co-conspirators pleaded guilty in December 2012 to related drug trafficking charges. Sentencings are set for March 6, 7 and 8.
The remaining defendant, Guadalupe Meraz, 41, of Madera, California, did not appear in court as scheduled. A warrant for his arrest has issued.
The charges are the result of a nine-month investigation by the Organized Crime Drug Enforcement Task Force (OCDETF), including the Idaho State Police, Bonneville County Sheriff's Office, Idaho Falls Police Department, Madison County Sheriff's Office, Rexburg Police Department, Bingham County Sheriff’s Office, Fremont County Sheriff’s Office, Federal Bureau of Investigation (FBI), U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), Internal Revenue Service-Criminal Investigation, and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Other federal agencies participating in the OCDETF program include the Drug Enforcement Administration and the U.S. Marshals Service.
The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organization
Former Treasurer of St. Joseph Conference of St. Vincent De Paul Society Sentenced for EmbezzlementRead the Press Release
St. Louis, MO - Nancy O’Donnell was sentenced to one year and one day in prison for her embezzlement of donor funds. She was also ordered to pay $209,000 restitution, $192,000 has already been paid.
According to court documents, St. Joseph Catholic Church of Cottleville, Missouri, was a Catholic Church in operation for over 100 years. The St. Vincent de Paul Society was a non-profit organization providing personal assistance with furniture, food, clothing, rent, utilities and other necessities to people facing economic and other crises. The St. Joseph Conference of the St. Vincent de Paul Society is comprised of lay Catholic volunteers collecting and distributing donations to those in need within the St. Joseph parish. Monetary donations are made to the St. Joseph Conference of the St. Vincent de Paul Society through cash and by check primarily from St. Joseph parishioners.
Nancy O'Donnell served as the Treasurer for the St. Joseph Conference of the St. Vincent de Paul Society since October 2005. As Treasurer, she was in charge of financial record keeping for the Society, including receiving donations and payments by cash and check, documenting payments received, depositing funds to the Society's bank account and documenting the use of donated funds. The St. Joseph Conference of the St. Vincent de Paul Society had an authorized bank account for the receipt and disbursement of donations under the Society's actual address. On April 27, 2006, O’Donnell opened a sham checking account in the name of the St. Joseph Conference of the St. Vincent de Paul Society, using her own personal residence address as the business address for this sham account. The Board of Directors of the Society had no knowledge that she had opened this sham account and did not authorize the opening of the account. In opening the sham account, she completed and executed an unauthorized corporate resolution on behalf of the Society, and completed and executed paperwork so that she was the only authorized signer on the sham account. She also maintained a personal checking account in her own name.
As Treasurer of the Society, O’Donnell received donations from individuals by cash or check made out to the Society and, instead of depositing those cash or check donations into the Society's authorized account, she deposited those cash and check donations either into the unauthorized sham account or into her personal account. O’Donnell then wrote checks on both the sham account and the personal account either to herself or to "cash" thereby embezzling, misappropriating and stealing those donated funds, which she used for her own personal purposes, unrelated to the business of the Society. O’Donnell also wrote checks on the Society’s authorized account and deposited those checks into both the sham account and into her personal account, using the funds for personal expenses.
In order to conceal her scheme, all treasurer's reports prepared by O’Donnell and provided by her to the Society included only information from the authorized account and no information from the unauthorized sham account. Further, in order to conceal her scheme, all account statements and correspondence relative to the sham account were mailed to her at her personal residence address, rather than to the Society’s true business address.NANCY O'DONNELL, St. Peters, MO, pled guilty in October to one felony count of mail fraud. She appeared today for sentencing before United States District Judge John A. Ross.
This case was investigated by the Cottleville Police Department and the Federal Bureau of Investigation. Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney’s Office.
Former Miami Clinic Director Sentenced to 70 Months in Prison for Role in HIV Infusion Fraud SchemeRead the Press Release
A former Miami HIV infusion clinic director was sentenced yesterday to serve 70 months in prison for his role in a $26.2 million HIV infusion fraud scheme, announced U.S. Wifredo A. Ferrer of the Southern District of Florida, Assistant Attorney General Lanny Breuer of the Criminal Division, Acting Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Enrique Gonzalez, 67, formerly of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Judge Altonaga sentenced Gonzalez to serve three years of supervised release and ordered him to pay $17,590,896 in restitution to HHS.
On Nov. 13, 2012, Gonzalez pleaded guilty to one count of conspiracy to defraud the United States, to cause the submission of false claims, and to pay health care kickbacks, and one count of conspiracy to commit health care fraud.
Gonzalez admitted that between August 2002 and March 2004, he conspired with co-defendant Ronald Harris, a Miami physician, and alleged co-conspirators to operate Physicians Med-Care and Physicians Health (together the “Physicians Clinics”), two Miami HIV infusion clinics. According to court documents, the Physicians Clinics were owned and controlled by alleged co-conspirators Carlos Benitez and his brother Luis Benitez. The Physicians Clinics purported to specialize in treating patients with HIV, but were operated for the sole purpose of committing Medicare fraud, according to court documents. Gonzalez was a director of Physicians Med-Care and, at the direction of his co-conspirators, was responsible for the finances of the Physicians Clinics.
Gonzalez admitted that he agreed with his co-conspirators to handle the finances for the Physicians Clinics, moving the money paid by the Medicare program out of the Physicians Clinics’ accounts and into accounts owned and controlled by his co-conspirators. According to court documents, Harris signed blank checks that Gonzalez used to transfer funds to various Benitez-owned entities and others, as directed by his co-conspirators. In addition, Gonzalez agreed to provide cash to various co-conspirators at the Physicians Clinics to be used to pay bribes and kickbacks to the Medicare beneficiaries in return for those beneficiaries allowing the Physicians Clinics to bill the Medicare program for HIV infusion services that were not medically necessary and often not provided.
Gonzalez admitted that during his association with Physicians Med-Care, the clinic billed the Medicare program approximately $24.5 million in HIV infusion therapy claims, for which the clinic received $16.7 million in payments. Gonzalez also admitted that during his time with Physicians Health, the clinic billed Medicare approximately $1.7 million and received approximately $800,000 in payment from the Medicare program for fraudulent services.
Gonzalez was a fugitive from justice from the time of his indictment in 2008, until he was located and detained in Peru in late 2011. Gonzalez was extradited to the United States in July of 2012. Gonzalez’ daughter, Carmen Gonzalez, was indicted in a related case and is currently a fugitive.
Co-defendant Harris pleaded guilty on Aug. 26, 2008, to one count of conspiracy to defraud the United States, to cause the submission of false claims and to pay health care kickbacks; one count of conspiracy to commit health care fraud; and three counts of submitting false claims to the Medicare program. Harris pleaded guilty in connection with his role as the medical director for the Physicians Clinics. On Nov. 4, 2008, Harris was sentenced to serve 84 months in prison for his role in the scheme.
Carlos and Luis Benitez and Thomas McKenzie were charged separately with health care fraud and money laundering crimes in an indictment unsealed on June 11, 2008. According to the separate indictment, the defendants provided the money and staff necessary to open the Physicians Clinics, the Medicare patients that the clinics needed to bill the Medicare program and transportation for the HIV patients who visited the clinics. Carlos and Luis Benitez and McKenzie were charged for their role in committing approximately $109 million in HIV infusion fraud and money laundering through the Physicians Clinics and nine other HIV infusion clinics.
On Sept. 18, 2008, McKenzie pleaded guilty to one count of conspiracy to commit health care fraud and one count of submitting false claims to the Medicare program, and admitted to his role in a $119 million HIV infusion fraud scheme. On Dec. 18, 2008, McKenzie was sentenced to serve 14 years in prison.
Carlos and Luis Benitez are also fugitives. Anyone with information regarding the whereabouts of the fugitives is urged to contact HHS-OIG fugitive reporting phone line at 888-476-4453.
The defendants who have not been convicted are presumed innocent unless and until proven guilty.
The Physicians Med-Care and Physicians Health case is being prosecuted by Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section. The case was investigated by the FBI and the DHS Office of Inspector General.
The case 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. The Department also thanks the Peruvian National Police Interpol Unit for their assistance.
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.
Former Federal Inmate Sentenced for Attempting to Possess Heroin in PrisonRead the Press Release
ALEXANDRIA, La.: United States Attorney Stephanie A. Finley announced today that U.S. District Judge Dee D. Drell sentenced former federal inmate Jose Rueperto Alaniz, 39, of Wichita Falls, Texas, to 24 months in prison with three years supervised release and Diana Castillo, 31, also of Wichita Falls, Texas, to three months in prison with three years supervised release for attempting to smuggle heroin into the U.S. Penitentiary in Pollock. The sentence was handed down yesterday in federal court in Alexandria.
Investigation of the case revealed that Castillo visited Alaniz on May 22, 2010, in the Pollock Penitentiary visiting room. Prison officials observed Alaniz remove something from Catillo’s waistband. They then saw Alaniz place the object in his own jumpsuit. A search of Alaniz later revealed two small packages of approximately 74.8 grams of black tar heroin.
At the time, Alaniz was in prison for violating supervised release relating to a distribution of cocaine charge and left the prison Sept. 29, 2010 after completing time served for that offense. He will now return to federal prison to serve time for the contraband charge.
The FBI, Alexandria, Louisiana Resident Agency conducted the investigation. Senior Litigation Counsel Joseph G. Jarzabek and Special Assistant U.S. Attorney Robert J. France prosecuted the case.