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11 February 2013
Man Sentenced to Serve 150 Months in Federal Prison for Sex Trafficking of ChildrenRead the Press Release
United States Attorney Laura E. Duffy announced that Randy Martell Ballard, also known as “Jazmin Davis,” was sentenced today by United States District Court Judge Roger T. Benitez to serve 150 months in federal prison, followed by 5 years of supervised release, pay a $1,000.00 fine and mandatory registration under the Sex Offender Registration and Notification Act. Ballard pled guilty in November 2012 to sex trafficking of children, in violation of Title 18, United States Code, Section 1591(a) and (b).
According to court documents, Ballard met a fourteen-year-old girl in El Paso, Texas and transported her to San Diego for the purpose of engaging her in prostitution. He purchased a bus ticket for her using a false name. Court documents further show that Ballard posted online prostitution ads on the Internet with a phone number that the minor had in her possession and provided the minor with false identification documents.
This case arises from an investigation by the National City Police Department and the Immigration and Customs Enforcement’s Homeland Security Investigations.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
DEFENDANT Case Number: 12cr2259BEN Randy Martell Ballard SUMMARY OF CHARGETitle 18, United States Code, Sections 1591(a) and (b) - Sex Trafficking of Children
INVESTIGATING AGENCIESNational City Police Department
Immigration and Customs Enforcement’s Homeland Security InvestigationsMan Indicted for Robbing A Lexington BankRead the Press Release
LEXINGTON, KY - A Lexington man was indicted for allegedly robbing a bank in Fayette County in November of last year.
Kerry B. Harvey, U.S. Attorney for the Eastern District of Kentucky, Perrye Turner, Special Agent in Charge, FBI and Ronnie J. Bastin, Chief of Police for the Lexington-Fayette Urban County Government jointly made the announcement today.
A federal grand jury in Lexington returned the indictment February 7, charging 38-year-old William Abshear with one count of bank robbery.
According to the indictment, Abshear used intimidation to take $1,500 from the Chase Bank on Winchester Road on November 26 of last year.
Court documents allege that Abshear passed a note to the teller demanding that she put money on the counter. After getting the money, Abshear allegedly fled the bank on foot. Lexington Police used surveillance photographs to identify Abshear as a suspect. He was arrested in Phoenix, Ariz., on December 20.
>The investigation was conducted by the Lexington-Fayette Urban County Government and the FBI. Assistant U.S. Attorney Elisabeth Brown is prosecuting the case for the U.S. Attorney’s Office.
A date for Abshear to appear in federal court in Lexington has not yet been set. If convicted, Abshear faces a maximum penalty of 20 years in prison. However, any sentence following a conviction would be imposed after the Court considers the U.S. Sentencing Guidelines and the federal statutes governing the imposition of sentences.
Macy Man Sentenced to 37 Months for AssaultRead the Press Release
United States Attorney Deborah R. Gilg announced that Conrad D. Lyons, Jr., 24, of Macy, Nebraska was sentenced in the United States District Court at Omaha for Assault with a Dangerous Weapon. The Honorable Laurie Smith Camp, Chief Judge, imposed a sentenced of 37 months. After his release from prison Lyons will be on a 3 year term of supervised release.
Lyons had recently been released from federal prison for assaulting a federal officer in August 2012. He was on supervised release for that crime.
On August 3, 2012, Lyons was in a verbal altercation with his girlfriend who is also the mother of his children at a bar in Walthill, Nebraska. He was removed from the bar. His girlfriend left the bar later and began to walk home. Lyons approached her and struck her to the face with both his fist and a full beer can. The force of the beer can split her lip vertically to the base of her nose. Lyons then struck a witness who attempted to intervene. Lyons continued to assault his girlfriend once she entered her residence until the Omaha Tribal Police Department arrived and intervened.
Local Mortgage Broker Found Guilty of Bank and Wire FraudRead the Press Release
David Ovist convicted of submitting fraudulent mortgage loan applications
PORTLAND, Ore. – David Ovist, 45, of Lake Oswego, Oregon, was convicted Friday, February 8, 2013 of the crimes of bank fraud and wire fraud following a ten-day jury trial. Ovist is scheduled to appear before U.S. District Court Judge Anna J. Brown on May 7, 2013 for sentencing on these charges.
Ovist was a licensed mortgage loan broker and the owner of Oregon Mortgage Services, Inc., located in Beaverton, Oregon. The federal indictment charged that Ovist, acting as a residential mortgage loan broker, knowingly prepared, on behalf of eight borrowers, residential loan applications related to 15 different properties that falsified the borrower’s financial qualifications. The applications were then submitted by Ovist to eight different mortgage lenders with the intent that the lenders would approve mortgage loans for those properties based upon the false financial qualifications provided in the loan applications. The jury convicted Ovist of 12 of the 15 counts in the indictment.
“The effects of mortgage fraud committed during the housing bubble of 2006-2008 continue to impact the livability of our community,” said U.S. Attorney Amanda Marshall. “This conviction demonstrates that the Department of Justice remains committed to investigate and prosecute those who wreaked havoc on our financial institutions and real estate markets.”
“Mortgage fraudsters believe their criminal schemes will put them – and their clients – on the easy road to riches,” said Greg Fowler, Special Agent in Charge of the FBI in Oregon. “Our agents work to ensure that these criminals find themselves on the road to federal prison instead. With the help of the community we serve, we will continue to identify those who would subvert the American dream of home ownership and bring them to justice.”
At sentencing, the maximum penalty for each of the three bank fraud convictions is thirty years in prison and a maximum fine of $1,000,000. The maximum penalty for each of the nine wire fraud convictions is twenty years in prison and a maximum fine of $250,000. The actual sentence will be determined under the Federal Sentencing Guidelines based, in part, on the total amount of losses suffered by the mortgage lenders as a result of the loans.
The investigation was initiated by the Portland office of the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Hannah Horsley and Scott Erik Asphaug.
Local Businessman Charged with Wire Fraud for Using Investors' Funds as His Personal Piggy BankRead the Press Release
Defendant Allegedly Stole Approximately $800,000 from His Business Investors
ATLANTA – The co-founder of Geometrix has been charged in a federal criminal information with defrauding business investors of approximately $800,000. Kevin Patrick Loughery, 49, of Atlanta, Georgia, who co-founded Geometrix in 2007, was arraigned today before United States Magistrate Judge Alan J. Baverman on the federal charge of wire fraud, and was released on bond.
“Instead of keeping his business investors’ funds secure in an escrow account, the defendant is charged with using hundreds of thousands of dollars to support his lavish lifestyle,” stated United States Attorney Sally Quillian Yates. “The charges against Loughery reflect our ongoing commitment to crack down on investment fraud.”Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated: “When the defendant diverted investor funds to his personal account, he left behind his multiple investors-turned-victims now suffering substantial financial losses while he pursued a life of affluence. The FBI remains well-suited and committed to investigating such cases of wire fraud that often significantly impact many victims.”
According to United States Attorney Yates, the charges and other information presented in court: In 2008, Kevin Patrick Loughery began soliciting investments from his friends and business associates in Geometrix, a Georgia start-up company that he co-founded in 2007. Loughery assured investors both telephonically and via email that their investment would remain in escrow until the completion of Geometrix’s issuance of stock and accompanying documentation.
In an email to one such investor, Loughery assured the investor that the money would be kept in an escrow account, and Loughery instructed the investor to wire the money into such an account. However, the money never went to an escrow account because Loughery’s wiring instruction was not for an escrow account, but rather was for Loughery’s own account for a separate business, KLM Investments, of which Loughery was the sole proprietor. The investor wired over $300,000 into the account. Loughery then sent the investor an email stating that the investor would receive 400,000 shares of Geometrix for his investment. The investor never received those shares.
In total, Loughery solicited $780,000 in investments from various investors that were supposed to be kept in escrow but instead were spent by Loughery. Loughery subsequently declared bankruptcy.
This case was investigated by special agents of the Federal Bureau of Investigation.
Assistant United States Attorney Karlyn J. Hunter is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Information Office at [email protected] or (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney's Office for the Northern District of Georgia is www.justice.gov/usao/gan.
Linda Reynolds Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on February 11, 2013, before U.S. District Judge Sam E. Haddon, LINDA REYNOLDS, a 63-year-old resident of Great Falls, was sentenced to a term of:
Prison: 262 months
Special Assessment: $100
Supervised Release: 5 years
REYNOLDS was sentenced in connection with her guilty plea to conspiracy to possess with intent to distribute methamphetamine.
In an Offer of Proof filed by Assistant U.S. Attorney Jessica A. Betley, the government stated it would have proved at trial the following:
In July 2012, detectives from the Great Falls Police Department became alerted to a potential methamphetamine distribution ring in Great Falls. Detectives believed the methamphetamine was being brought to Montana from somewhere near Spokane, Washington.
On September 6, 2012, police received information from an anonymous caller, who stated REYNOLDS was dealing methamphetamine out of her apartment in Great Falls. The caller had purchased methamphetamine a few times from REYNOLDS in half-gram quantities. Police also spoke to additional witnesses who stated they received their methamphetamine supply from REYNOLDS.
Based on this information, police executed a search warrant at REYNOLDS' apartment that same day. REYNOLDS agreed to speak with police. She said there were drugs in the back bedroom and she currently possessed two ounces of methamphetamine. REYNOLDS explained she began dealing methamphetamine in July and she received her supply of methamphetamine from Joe and Ann Wetzel. She stated she received one ounce in July, an additional ounce in late August, and had just received the two ounces she had in her possession. REYNOLDS received methamphetamine from Mark Knesss. According to REYNOLDS, Kness brought his drug dealer, Louis Kanyid, to REYNOLDS' apartment in the winter of 2012. Kanyid regularly went by "Washington" in Great Falls, because he traveled from the state of Washington. REYNOLDS observed methamphetamine deals between Kness and Kanyid, and Kness would brag about how the methamphetamine was of great quality.
Sometime in July 2012, REYNOLDS heard Kanyid was back in Great Falls. REYNOLDS told police that she then contacted Joe and Ann Wetzel directly to get methamphetamine. Joe and Ann Wetzel had told REYNOLDS they were directly supplied by Kanyid. REYNOLDS paid Joe and Ann Wetzel $1,700 per ounce of methamphetamine. She then resold the methamphetamine for $3,700 per ounce and paid the Wetzels $1,000 for facilitating the deal. Law enforcement seized over 50 grams of actual (pure) methamphetamine in their investigation.
Kanyid, Kness, Joe and Ann Wetzel pled guilty to federal charges.
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that REYNOLDS will likely serve all of the time imposed by the court. In the federal system, REYNOLDS does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.
The investigation was conducted by the Russell County Drug Task Force.
Latin Kings’ Second-In-Command Sentenced to 40 Years in Prison for RICO Conspiracy and Related Gang CrimesRead the Press Release
CHICAGO — The second highest-ranking leader nationwide of the Latin Kings street gang was sentenced to 40 years in federal prison after being convicted at trial in 2011 of racketeering conspiracy (RICO) and related charges involving narcotics trafficking and violence that plagued numerous neighborhoods on the city’s north, south and west sides. The defendant, VICENTE GARCIA, Jr., 35, the “Supreme Regional Inca” of the Almighty Latin King Nation, who oversaw the day-to-day illegal activities of all factions of the gang with some 10,000 members in Illinois alone, has been in federal custody since late 2008 and must serve at least 85 percent of his sentence.
The sentence was imposed Friday by U.S. District Judge Charles Norgle, who also ordered five years of supervised release after Garcia’s prison term ends.
Garcia, also known as “DK” or “Disciple Killer,” together with Augustin Zambrano, the leader or “Corona” of the Latin Kings, and two additional defendants were found guilty in April 2011 of running a criminal enterprise to enrich themselves and others through drug-trafficking and preserving and protecting their power, territory and revenue through acts of murder, attempted murder, assault with a dangerous weapon, extortion, and other acts of violence.
“This sentence holds Garcia accountable for the barbaric enterprise known as the Latin Kings and his role in murder, attempted murder, shootings, beatings, drug trafficking, and other crimes,” said Gary S. Shapiro, United States Attorney for the Northern District of Illinois.
Zambrano, 52, was sentenced to 60 years in prison in January 2012. Two other co-defendants convicted at the same trial also received substantial prison terms. Jose Guzman, a former “Nation Enforcer” in the 26th Street, or Little Village, faction, was sentenced to 35 years in prison, and Alphonso Chavez, the “Inca,” or leader of the gang’s 31st and Drake faction, was sentenced to 30 years in prison. Another co-defendant, Fernando “Ace” King, who preceded Garcia as Supreme Regional Inca and pleaded guilty, was sentenced in October 2011 to 40 years in prison.
Trial evidence included audio and video recordings of three beatings inflicted upon gang members for violating the rules and testimony documenting three murders and 20 shootings in the Little Village area. In addition to RICO conspiracy, Garcia was convicted of assault with a dangerous weapon and using a firearm during a violent crime.
Garcia was among a total of 31 co-defendants who were indicted in September 2008 or charged in a superseding indictment in October 2009. Of those 31 defendants, 24 pleaded guilty, four were convicted at trial, and three remain fugitives. From its origin and base in the west side Little Village community, the Latin Kings spread throughout Chicago and Illinois and established branches in other states, where local leaders acted with some autonomy but adhered to the rules and hierarchy of the Chicago gang, according to the evidence in the five-week federal trial.
The sentence was announced by Gary S. Shapiro, United States Attorney for the Northern District of Illinois, together with Cory B. Nelson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation, and Larry Ford, Special Agent-in-Charge of the Chicago Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives. The Chicago Police Department, the U.S. Immigration and Customs Enforcement (ICE) Office of Homeland Security Investigations (HSI) in Chicago, and the Cook County Sheriff’s Police also had significant roles in the investigation, which was conducted through the federal High Intensity Drug-Trafficking Area (HIDTA) Task Force and under the umbrella of the Organized Crime Drug Enforcement Task Force (OCDETF).
In late 2006, ATF agents led an investigation that resulted in federal drug trafficking and firearms charges against 38 Latin Kings members and associates. In 2008, the FBI led an investigation that resulted in state and federal charges against 40 Latin Kings members and associates, including a dozen of the Zambrano co-defendants. In total, more than 80 Latin Kings members and associates have faced state or federal charges since 2006. The convictions result from a sustained, coordinated effort by federal law enforcement agencies, working together with the Chicago Police Department and other state and local partners, to dismantle the hierarchy of the Latin Kings and other highly-organized, often violent Chicago street gangs.
Garcia and Zambrano were the highest-ranking Latin Kings to be convicted and sentenced since Gustavo “Gino” Colon, who also holds the title of “Corona,” was sentenced to life in prison in 2000.
The government was represented by Assistant U.S. Attorneys Andrew Porter, Nancy DePodesta and Tinos Diamantatos.
For further information about the Garcia trial, see the government’s previous press release at: Latin Kings’ Nationwide Leader, Augustin Zambrano, and Three Other High-ranking Gang Members Convicted of RICO Conspiracy and Related Crimes in Federal Trial.
Las Cruces Man Sentenced to Fifty-One Months in Prison for Robbing Citizens Bank of Las Cruces in August 2010Read the Press Release
ALBUQUERQUE – Claudio Alberto Morales-Medrano, 40, of Las Cruces, N.M., was sentenced this morning to 51 months in prison followed by three years of supervised release for his bank robbery conviction. Morales-Medrano also was ordered to pay full restitution to the victim of his crime. The sentence was announced by U.S. Attorney Kenneth J. Gonzales and Special Agent in Charge Carol K.O. Lee of the Albuquerque Division of the FBI.
Morales-Medrano was arrested on Aug. 27, 2010, based a criminal complaint alleging that he robbed the Citizens Bank of Las Cruces (Bank), located at 2841 N. Main Street, in Las Cruces, on that same day. He has been in federal custody since his arrest.
Court records reflect that, on Aug. 27, 2010, Morales-Medrano entered the Bank and approached a bank teller, pulled out a gun that he brandished at the teller, and demanded money. After obtaining cash from the teller, Medrano-Morales left the bank and fled in a silver four door sedan. Shortly thereafter, officers of the Las Cruces Police Department executed a stop of a vehicle matching the description of the vehicle in which the bank robber fled. The officers arrested Morales-Medrano and recovered the money that was taken from the Bank, a black toy gun and clothes matching the description of the clothes worn by the bank robber. On Jan. 12, 2012, Morales-Medrano pled guilty to the bank robbery without the benefit of a plea agreement.
The case was investigated by the Las Cruces office of the FBI and the Las Cruces Police Department, and was prosecuted by Assistant U.S. Attorney Maria Y. Armijo of the U.S. Attorney’s Las Cruces Branch Office.
Justice Department Moves to Intervene in Lawsuit Alleging Sex Discrimination Against the State of Maryland, Queen Anne’s County and the Queen Anne’s County SheriffRead the Press Release
The Justice Department today moved to intervene in Murphy-Taylor v. State of Maryland, et al., a private lawsuit alleging sex discrimination by the state of Maryland, Queen Anne’s County and the Queen Anne’s County Sheriff. The United States’ complaint in intervention alleges that Kristy Murphy-Taylor’s supervisors in the sheriff’s office subjected her to severe sexual harassment and retaliated against her when she complained. The complaint alleges that these actions violate Title VII of the Civil Rights Act of 1964.
According to the complaint, over a number of years Ms. Murphy-Taylor was subjected to numerous acts of unwanted sexual conduct by multiple supervisors including, multiple incidents of unwanted sexual touching, sexually explicit comments about Ms. Murphy-Taylor and other female officers, and derogatory comments about Ms. Murphy-Taylor based on her sex and about women in general.
Despite Ms. Murphy-Taylor’s complaints to supervisory officials about the unwelcome conduct, the complaint alleges that the defendants failed to take prompt and effective corrective action, subjected her to intolerable working conditions intended to make her quit, and ultimately terminated her for complaining about the sexual harassment.
The United States determined that this case represents a matter of general public importance and that the Department of Justice should participate in it. By intervening, the United States will ensure that the law continues to protect employees and that the price of earning a living will not be enduring constant sexual harassment. The relief sought by the United States is past and future lost wages and compensatory damages for Ms. Murphy-Taylor as well as the implementation of effective sexual harassment policies and procedures and training on these policies and procedures.
Ms. Murphy-Taylor filed a charge of sex discrimination and retaliation with the Baltimore District Office of the Equal Employment Opportunity Commission (EEOC). After investigating these charges, finding reasonable cause to believe that the charging party was subject to discrimination because of her sex, and unsuccessfully attempting to conciliate the matter, the EEOC referred the charges to the Department of Justice. This lawsuit is brought by the Department of Justice as a result of a project designed to ensure vigorous enforcement of Title VII against state and local governmental employers by enhancing cooperation between the EEOC and the Civil Rights Division.
“The Department of Justice will not stand by while women are forced to endure unwanted sexual conduct in their workplaces and then penalized for protesting it,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division. “Through our partnership with the EEOC, the department continues its commitment to vigorously enforcing the right of employees to be free from sex discrimination in the work place.”
“The work of the commission is made more effective and efficient with interagency coordination,” said Jacqueline A. Berrien, chair of the Equal Employment Opportunity Commission. “Our ongoing project with the Justice Department helps to ensure that employees receive the full protection of the laws prohibiting workplace discrimination.”
“By working more closely together in appropriate cases, EEOC and DOJ are able to use our resources more efficiently to ensure the vigorous enforcement of Title VII in the public sector,” said EEOC District Director Spencer H. Lewis Jr., of the EEOC’s Philadelphia District Office. The Philadelphia District Office of the EEOC oversees Pennsylvania, Maryland, Delaware, West Virginia and parts of New Jersey and Ohio.
Title VII prohibits discrimination in employment on the basis of sex, race, color, national origin or religion, and prohibits retaliation against an employee who opposes an unlawful employment practice, or because the employee has made a charge or participated in an investigation, proceeding or hearing under the Act. More information about Title VII and other federal employment laws is available at www.usdoj.gov/crt/emp/index.html .
The EEOC enforces federal laws prohibiting employment discrimination. Further information about the EEOC is available on its website at www.eeoc.gov.
Johnston City Man Pleads Guilty to Methamphetamine ConspiracyRead the Press Release
On February 8, 2013, Steven A. Smith, 33, of Johnston City, IL, pled guilty in United States District Court in Benton to a one-count indictment which charged conspiracy to manufacture methamphetamine, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced today.
The offense occurred between 2010 and January, 2012, in Williamson, Jackson, and Franklin Counties. Evidence at the plea hearing established that Smith conspired with others in the manufacture of methamphetamine. Smith was involved in stealing anhydrous ammonia and obtaining pseudoephedrine for use during methamphetamine “cooks.” Smith stipulated that he was responsible for the manufacture of between 500 grams and 1.5 kilograms of methamphetamine.
Sentencing was set for May 23, 2013. At that time, Smith faces from 20 years to life imprisonment, a fine of up to $20,000,000 and 10 years’ supervised release. Co-defendants Christopher D. Norris and Robert D. Starcher have previously been sentenced to prison terms of 216 months and 100 months, respectively, for their role in the methamphetamine conspiracy. Two other co-defendants have pled guilty and are awaiting sentencing.
The ongoing investigation is being conducted by the Jackson County Sheriff’s Office, Williamson County Sheriff’s Office, Murphysboro Police Department, Marion Police Department, Illinois State Police, Mt. Vernon Police Department, and Drug Enforcement Administration.
The case is being prosecuted by Assistant United States Attorney Amanda A. Robertson.
Johnson County Man Pleads Guilty to Producing Child PornRead the Press Release
KANSAS CITY, KAN. – A man from Johnson County, Kan., has pleaded guilty to producing child pornography, including images of an unclothed two-year old boy in a roaster pan in an oven, U.S. Attorney Barry Grissom said today.
Michael D. Arnett, 38, Roeland Park, Kan., pleaded guilty to one count of producing child pornography. In his plea, Arnett admitted that investigators found child pornography on his computer when they served a search warrant May 15, 2012, at his home in Roeland Park.
The case began when Homeland Security Investigation’s Operation Holitna seized child pornography including images of victims who appeared to be from the area of Overland Park, Kan. Investigators focused on a water bottle in one of the photos bearing the words “Midwest Aquatics” and a phone number beginning with the 913 area code. Midwest Aquatics is a swim and scuba center located at 7565 W. 160th Street in Overland Park.
With the assistance of teachers at an elementary school in Shawnee Mission, investigators ultimately identified three boys who been photographed at Arnett’s home at 5451 Juniper Drive in Roeland Park. At the time the photos were taken, the boys were 11, 8 and 2 years old.
Among the images investigators found was one of a naked boy about two years old lying in a roaster pan that was placed inside an open oven. Another image showed the same boy in the roaster pan with the oven door shut.
Investigators learned that Arnett met the children while he was driving for Kaw Valley Health Systems, a nonprofit corporation that provides medical care and social services for children. He drove them to family visitations, counseling and other appointments.
Sentencing is set for May 13. Arnett faces a penalty of not less than 15 years and not more than 30 years in federal prison and a fine up to $250,000. Grissom commended ICE’s Homeland Security Investigations, the Johnson County Sheriff’s Department and Assistant U.S. Attorney Kim Martin for their work on the case.
Investment Advisor Sentenced to Prison in $2 Million SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announced that Paul D. Wolfe, 42, formerly of Hobe Sound, Florida, was sentenced today to 44 months’ imprisonment, to be followed by three years of supervised release. Wolfe was also ordered to pay restitution in the amount of $2,279,148.36.
Wolfe previously pled guilty to one count in an Information charging him with wire fraud in connection with an investment scheme involving approximately $2.2 million in losses.
According to court documents, Wolfe’s investment fraud scheme spanned from 2005 through 2011. Wolfe, who operated as an unlicensed investment advisor, admitted that he provided false and fraudulent investment return data to numerous investors and that he inflated investment returns. Furthermore, Wolfe diverted investor funds, in part, to pay for his personal expenses.
Mr. Ferrer commended the investigative efforts of the Federal Bureau of Investigation in this case. The case is being prosecuted by Assistant United States Attorney Stephen Carlton.
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.
Illinois Man Found Guilty of Sex TraffickingRead the Press Release
United States Attorney Brendan V. Johnson announced that Carl Campbell, 37, of Chicago, Illinois was found guilty of five counts including sex trafficking by force and sex trafficking of children. The guilty verdicts followed a week-long federal jury trial in Sioux Falls.
A federal jury convicted Campbell after hearing evidence that he lured in adults and minors and caused them to engage in commercial sex acts in and around Sioux Falls. He assaulted one victim repeatedly over the course of about 8 months in which he forced her to perform commercial sex acts in South Dakota, Iowa, Wisconsin, and Illinois.
“This defendant has been brought to justice for his role in the sexual enslavement of young women,” said Johnson. “The verdict sends a strong message, if you engage in the heinous act of sex trafficking in South Dakota we will prosecute you to the fullest extent of the law.”
Campbell’s convictions include one count of Sex Trafficking by Force, Fraud, or Coercion; one count of Interstate Transportation for Prostitution; one count of Obstruction of Sex Trafficking Enforcement, and two counts of Sex Trafficking of a Child. Sex Trafficking by Force, Fraud, or Coercion carries a mandatory minimum sentence of 15 years in prison and up to a life maximum. The two convictions for Sex Trafficking of a Child each carry a mandatory minimum sentence of 10 years in prison and up to a life maximum. The remaining two counts involving interstate transportation and obstruction carry maximum prison terms of up to 20 years each.
This case was investigated by Homeland Security Investigation, Federal Bureau of Investigation, the South Dakota Division of Criminal Investigation, the Minnehaha County Sheriff’s Office, Sioux Falls Police Department, and the Franklin County (Illinois) Police Department. It was prosecuted by Assistant U.S. Attorneys Kevin Koliner and Jeff Clapper. A presentence investigation was ordered, and sentencing has been set for April 29, 2013, before U.S. District Judge Karen E. Schreier. The defendant was remanded to the custody of the U.S. Marshal pending sentencing.
Huntington Man Sentenced to 7 Years in Federal Prison for Firearm and Illegal Drug Possession ChargesRead the Press Release
HUNTINGTON, W.Va. – U.S. Attorney Booth Goodwin today announced that a Huntington man was sentenced to a total of seven years in federal prison for possessing a firearm during a drug trafficking crime and possession with intent to distribute heroin. Gregory Donearl Easterling also known as “Smoke” and “Dion A. Foster,” 38, of Huntington, previously pleaded guilty in September 2012. On December 21, 2011, members of the Huntington Drug and Violent Crimes Task Force conducted a search of the defendant’s Huntington residence. During the search of Easterling’s residence, law enforcement officers found approximately 6.8 grams of heroin located on an open kitchen shelf, an additional six bundles of heroin, three firearms and digital scales. Easterling admitted to law enforcement that he intended to sell the heroin.
Also during the December 2011 search of the defendant’s residence, law enforcement officers seized a loaded .45 caliber pistol that was stored in the rail of the defendant’s bed. Easterling admitted that he was responsible for possessing a total of 27 grams of heroin and 60 30-milligram oxycodone pills.
The Court sentenced Easterling to two years in prison for possession with intent to distribute heroin and five years in prison for possessing a firearm in furtherance of a drug trafficking crime, for a total of seven years in prison.
This case was prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
This case was also brought as part of Project Safe Neighborhoods. Project Safe Neighborhoods is a nationwide commitment to reduce gun crime in the United States by networking existing local programs targeting gun crime.
The Huntington Drug and Violent Crimes Task Force conducted the investigation. The prosecution was handled by Assistant United States Attorney Gregory McVey.
Homer Resident sentenced to ten years for distributing drugs to teenage girls and possessing child pornographyRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that a Homer charter boat captain was sentenced in federal court in Anchorage for one consolidated count of distributing drugs to underage individuals and one count of possession of child pornography.
Randall Scott Hines, age 34, was sentenced by United States District Court Judge Timothy M. Burgess to ten years’ imprisonment, to be followed by ten years’ supervised release. Following his release from federal custody, Hines must register as a sex offender for fifteen years.
In imposing the ten-year sentence on Hines, Judge Burgess stated that the facts Hines admitted in the plea agreement “underscore just how serious this offense was.” These facts included that between 2008 and 2011, Hines engaged in sexual relationships with a series of teenage girls in Homer. Hines frequently supplied these same girls with methamphetamine or other drugs, often in conjunction with having sex with them. Four of the six teenage girls with whom Hines had a sex and drug relationship were under the age of sixteen at the time and thus were under Alaska’s legal age of consent.
According to Assistant U.S. Attorney Kim Sayers-Fay, who prosecuted the case, Hines ten year sentence and ten year period of supervised release reflects that his crimes involved a pattern of sexual abuse. Hines also pled guilty to possessing a sexually explicit video clip of him engaged in sex conduct with one of the minor victims. By virtue of that child pornography conviction, Hines will be required to register as a sex offender for fifteen years following his release from federal custody.
During his sentencing remarks, Judge Burgess rejected the suggestion that Hines’ own methamphetamine addiction mitigated his culpability for his conduct. Judge Burgess told Hines, “[T]he bottom line is, in those instances that were outlined and detailed in the plea agreement in this case, there was one adult in the room. One adult. And that was you! You were the adult. I don’t care if you were drunk. I don’t care if you were on methamphetamine or oxycodone. You were the adult in the room, and you didn’t act like the adult in the room”. Adding, “I hope this is a cautionary tale.”
Hines’ plea agreement required him to fund a $160,000 trust fund to help victims obtain drug treatment and counseling. Judge Burgess noted this positive step, but observed that it would not make amends for the crimes, which had “significant and devastating effect on the victims and their families,” many of whom had sought restraining orders against Hines. As one mother told the court, Hines’ “age and finesse” allowed him to manipulate young women who had “not yet developed the ability to discern or recognize the evilness of his ways.”
Ms. Loeffler commends the persistence of the victims and their families in this case, as well as the work of the FBI and Anchorage Police Department Vice Unit as part of the Innocence Lost Task Force, whose combined efforts culminated in Hines’ convictions.
Hedge Fund Manager and C.P.A. Administrator for $40 Million Ponzi Scheme Convicted by JuryRead the Press Release
Defendant Stole Victims’ Money to Build Personal Mansion through Belizean Shell Company
CHARLOTTE, N.C. – On Friday, February 8, 2013, a federal jury in Charlotte convicted certified public accountant Jonathan D. Davey, 48, of Newark, Ohio of four criminal charges relating to an investment fraud conspiracy, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
The federal indictment, returned in February 2012, charged Davey with serving as the “Administrator” for numerous hedge funds for the Black Diamond Ponzi Scheme, with soliciting over $11 million from victims with his own hedge fund, “Divine Circulation Services,” and with tax evasion. The charges arise out of the Black Diamond investigation, which has brought criminal charges against eleven individuals and CommunityONE Bank, relating to conduct between October 2007 and April 2007 that deprived over 400 victims of more than $40 million.
U.S. Attorney Tompkins is joined in making today’s announcement by Roger A. Coe, Acting Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service - Criminal Investigation Division (IRS-CI).
According to evidence presented at trial, Davey lied to collect over $11 million from victims mainly in North Carolina, Virginia, and Ohio for his hedge fund by claiming, among other things, that he had done due diligence on Black Diamond and was operating a legitimate hedge fund with significant safeguards, when, in reality, neither claim was true. Then, as Black Diamond began to collapse, Davey and other hedge fund managers started a derivative Ponzi scheme using a so-called “cash account” that Davey controlled. Davey and his co-conspirators collected over $5 million from new victim investors for the cash account, and used the new victim money to make Ponzi payments to old investors and themselves. The evidence at trial showed that, as Administrator for the scheme, Davey controlled most funds and wires for the scheme, and published a website for victims that reflected false returns. At trial, the Government showed that by the end of the scheme, the website reflected over $120 million in supposed value for victim-accounts when Davey and the hedge fund managers in reality had less than $1 million total in their accounts.
According to evidence presented at trial, Davey used an elaborate network of shell companies to evade taxes and commit money laundering with the proceeds of the Ponzi scheme. In particular, Davey used an offshore shell company in Belize to funnel money to build a mansion in Ohio, creating a sham “loan” by pretending that investors had “loaned” investment money to the Belizean shell company that was then used to build Davey’s personal mansion.
Other defendants convicted in this case are set forth below.
Keith Franklin Simmons, 47, formerly of West Jefferson, N.C., was convicted following a jury trial of securities fraud, wire fraud, and money laundering. Simmons was sentenced to 50 years in prison on May 23, 2012.
Bryan Keith Coats, 52, of Clayton, N.C., pleaded guilty on October 24, 2011, to conspiracy to commit securities fraud and money laundering conspiracy. Coats was sentenced to 15 years in prison on November 16, 2012.
Deanna Ray Salazar, 55, of Yucca Valley, Calif., pleaded guilty on December 7, 2010, to conspiracy to commit securities fraud and tax evasion. Salazar was sentenced to 54 months in prison on May 23, 2012.
Jeffrey M. Muyres, 37, of Matthews, N.C., pleaded guilty on May 17, 2011, to conspiracy to commit securities fraud and money laundering conspiracy. Muyres was sentenced to 23 months in prison on January 18, 2012.
Roy E. Scarboro, 48, of Archdale, N.C., pleaded guilty on December 3, 2010, to securities fraud, money laundering, and making false statements to the FBI. Scarboro was sentenced to 26 months in prison on May 4, 2011.
James D. Jordan, 49, of El Paso, Texas, pleaded guilty on September 14, 2010, to conspiracy to commit securities fraud. Jordan was sentenced to 18 months in prison on June 29, 2011.
Stephen D. Lacy, 53, of Pawleys Island, S.C., pled guilty on December 9, 2010, to conspiracy to commit securities fraud. Lacy was sentenced to six months in prison on May 4, 2011.
Chad A. Sloat, 34, of Kansas City, Missouri, pleaded guilty on October 17, 2012, to conspiracy to commit securities fraud and failure to file a tax return. Sloat is currently waiting to be sentenced.
Jeffrey M. Toft, 50, of Oviedo, Fla., pleaded guilty on November 26, 2012, to conspiracy to commit securities fraud, conspiracy to commit wire fraud, and conspiracy to commit money laundering. Toft is currently waiting to be sentenced.
Michael J. Murphy, 52, of Deep Haven, Minnesota, pleaded guilty on January 22, 2013, to conspiracy to commit securities fraud. Murphy is currently waiting to be sentenced.
On April 27, 2011, a criminal bill of information and a Deferred Prosecution Agreement were filed against CommunityONE Bank, N.A., related to its failure to file a suspicious activity report (SAR) and maintain an effective anti-money laundering program. As court records show, Simmons was a customer of CommunityONE, and used various accounts with the Bank in furtherance of the Ponzi scheme. However, according to filed court documents, the Bank did not file any suspicious activity reports on Simmons, despite the hundreds of suspicious transactions that took place in his accounts. The Bank agreed to pay $400,000 toward restitution to victims of the Ponzi scheme that operated through accounts maintained at the bank.
Davey was convicted of all charges following a 45 minute jury deliberation. Davey faces a statutory maximum sentence of five years in prison for count one (securities fraud conspiracy) and a $250,000 fine, a maximum of 20 years in prison for count two (wire fraud conspiracy) and a $250,000 fine, a maximum of 20 years in prison for count three (money laundering conspiracy) and a $250,000 fine, and a maximum of five years in prison for count four (tax evasion) and a $250,000 fine. Davey has been released on bond and a sentencing date has not been set yet.
This matter is being prosecuted by Assistant United States Attorneys Kurt W. Meyers and Mark T. Odulio of the Western District of North Carolina, and the case against Jeffrey Muyres was prosecuted by Assistant United States Attorney Mark T. Odulio. The investigation is being handled by the FBI and the IRS.
Hampton Man Sentenced for Wire FraudRead the Press Release
NEWPORT NEWS, Va. – Virgil Williams, Jr., 46, of Hampton was sentenced today to 34 months in prison for wire fraud.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after sentencing by United States District Judge Robert G. Doumar.
Williams pled guilty on September 18, 2012. According to court documents, Williams owned Showcase Exclusive Imports, Inc., a retail auto sales business operating in Newport News. Williams obtained financing, known as “floor plans,” through various entities to finance the purchase of vehicles sold at his dealership. In 2006, his line of credit collapsed and he was forced to seek alternative financing. He sought and obtained financing from various lenders using fraudulent bank statements and earning reports causing extensive losses to those lenders. Williams also established a separate dealership through which to submit credit requests. At sentencing Williams was ordered to pay approximately $965,000 in restitution.
This case was investigated by FBI. Assistant United States Attorney Brian J. Samuels prosecuted this case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Greater Harrison Task Force Takes the Lead on Drug Education in North Central West VirginiaRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistSchool Officials & Law Enforcement Join Forces to Fight Addiction, Overdoses
CLARKSBURG, WEST VIRGINIA – Law enforcement leaders and local school administrators announced a new drug education and outreach program for North Central West Virginia on Thursday known as Project FUTURE: The Right Prescription for West Virginia.
Board members from the Greater Harrison County Drug & Violent Crimes Task Force (hereinafter “Task Force”) were joined today by Harrison County School Officials in making the announcement. According to United States Attorney William J. Ihlenfeld, II, Project Future is a comprehensive strategy designed to educate parents and children about the dangers of prescribed medicine, synthetic drugs, and other illegal drugs that are plaguing communities in West Virginia.
“The goal of Project Future is for every child to live a life free from substance abuse, and we plan to achieve that goal by the aggressive enforcement of drug trafficking laws as well as by educating our youth about the dangers of drugs,” said Ihlenfeld.
Dr. Gregory Moore, Assistant Superintendent of Harrison County Schools stated: "Prescription drug abuse is the leading type of drug abuse in the state of West Virginia. Project Future will supplement the educational programs Harrison County Schools already has in place that focus on prescription and illegal drugs in order to give our school system a comprehensive approach to teach children about the dangers of drug abuse. Since prescription drugs come from a doctor, people tend to believe that they are safe. But unless those drugs have been prescribed to you -- nothing could be further from the truth."
“The Task Force has a responsibility to do more than just arrest, indict, and lock people up,” said Chief John Walker, Bridgeport, WV, Police Chief and Chairperson of the Task Force Board. “We have a duty to inform the young people of Harrison County that the choices they make on a Friday or Saturday night at a party could affect them for the rest of their lives, or could even end their lives.”
Over the next year members of the Task Force Board will visit schools in North Central West Virginia and they’ll be joined by special guest speakers with real-life experience in dealing with addiction. In addition, community awareness meetings will be held in the evenings so that parents can be fully informed and made aware of warning signs that their children may be using drugs.
The Project Future events that have already been scheduled for the area include:
February 21, 2013
9:30 A.M. - Robert C. Byrd High School (11th & 12th grades)
1:30 P.M. - Robert C. Byrd High School (9th & 10th grades)
6:00 p.m. – Community Awareness Meeting (at Robert C. Byrd High School)February 22, 2013
9:00 A.M. - Bridgeport Middle School (7th & 8th grades)
10:30 A.M. – Washington Irving Middle School (8th grade)
1:45 P.M. – Liberty High School (9th & 10th grades)March 27, 2013
Calhoun County Middle-High School (7th thru 12th grades) Gilmer County High School (7th thru 12th grades)April 9, 2013
Cameron High School (7th thru 12th grades)April 30, 2013
Tucker County High School (9th thru 12th grades)May 1, 2013
Liberty High School (11th & 12th grades)
Fairmont Senior High School (9th thru 12th grades)The dates of additional events in Marion, Monongalia, Mineral and Hampshire Counties are in the process of being finalized and will be announced in the near future.
The Project Future program has partnered with United States Senator Jay Rockefeller, who has been a leader in Congress in tackling the issues related to prescription drug abuse. Drug Free Clubs of America is also a partner with the initiative.
U.S. Attorney Ihlenfeld said that he encourages other schools and community groups that are interested in hosting a Project Future event to contact his office at 304-234-0100.
Gang Member Sentenced to Federal Prison in Dodge City Racketeering CaseRead the Press Release
WICHITA, KAN. - A member of a Dodge City street gang was sentenced Tuesday to prison in a federal racketeering case, U.S. Attorney Barry Grissom said.
Anthony Wright, 27, Dodge City, Kan., was sentenced to nine years in federal prison. Wright pleaded guilty to one count of conspiracy to commit racketeering and one count of discharging a firearm in a crime of violence.
In his plea, Wright admitted he was a member of the Norteno street gang when he aided and abetted the murder of Israel Peralta on June 8, 2009, in Dodge City. On the day of the killing, Wright and another conspirator were out driving when they noticed a group of Hispanic males in a trailer park at 201 E. McArtor in south Dodge City who they believed were members of the rival Sureno gang. Later that day, Wright and three other Nortenos met together and decided to get in the car and go looking for Sureno gang members.
Wright drove the Nortenos to the trailer park and parked the car. Two of the Nortenos in the car with Wright were armed. One had a handgun that looked like a machine gun and the other had a revolver. They got out of the car with guns drawn, ran toward the group of Hispanic males and began firing. Israel Peralta was shot and killed. After the shooting, Wright and the other Norteno gang members drove away from the scene.
In his plea, Wright admitted that as a member of the Nortenos he was part of an ongoing criminal enterprise. The gang used murder, robbery, assault and the threat of violence to protect and expand its operations. He admitted that while he was a Norteno he participated in the sale of methamphetamine. Several other Nortenos were active in the sale of methamphetamine at the same time.
Wright is one of 22 Norteno gang members who have been convicted on charges contained in a federal indictment filed May 2012. It was only the second time a federal RICO Act indictment (Racketeer Influenced and Corrupt Organizations Act) has been filed in Kansas. Three defendants are awaiting sentencing: Juan Torres, Jayson Vargas and Alfredo Beltran-Ruiz.
Grissom commended the Dodge City Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Ford County Sheriff=s Office, the Kansas Bureau of Investigation, Assistant U.S. Attorney Lanny Welch and Assistant U.S. Attorney Aaron Smith for their work on the case.
Fort Myers Man Sentenced to More Than 2 ½ Years in Prison for Tax EvasionRead the Press Release
Fort Myers, FL - U.S. District Judge John E. Steele today sentenced Peter Jensen to 31 months in federal prison for tax evasion. The court also ordered him to pay restitution to the Internal Revenue Service in the amount of $2,155,133.88. Jensen pleaded guilty to one count of tax evasion on October 23, 2012.
According to court documents, for the years 2003 through 2009, Jensen attempted to evade paying federal income tax, in the amount of approximately $1.8 million. Jensen attempted to evade paying the taxes by placing real properties in the names of others, and utilizing the bank account of another individual, rather than depositing money he earned in a bank account from which the money could have been seized by the IRS.
"Today's sentencing again emphasizes that the Internal Revenue Service and the U.S. Attorney’s Office will continue their aggressive pursuit of those who use fraudulent methods in an attempt to corrupt our Nation's tax system." said James D. Robnett, Special Agent in Charge, IRS-Criminal Investigation, Tampa Field Office. "Honest taxpayers have been reassured today that no one is above the law, especially when the integrity of tax administration is at stake."
This case was investigated by the Internal Revenue Service, Criminal Investigation and was prosecuted by Assistant United States Attorney Robert Barclift.
Former Registered Nurse Sentenced in Miami to 111 Months in Prison in Connection with $63 Million Mental Health Care Fraud SchemeRead the Press Release
A former registered nurse was sentenced today to serve 111 months in prison for his role in a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced 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, 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.
John Thoen, 53, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Thoen was sentenced to serve three years of supervised release.
On Nov. 20, 2012, Thoen pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.
According to court documents, HCSN operated community mental health centers (CMHC) at three locations in Miami-Dade County, Fla., and one location in Hendersonville, N.C. HCSN purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness. A PHP is a form of intensive treatment for severe mental illness. According to court documents, HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not even provided. HCSN obtained those beneficiaries in Miami by paying kickbacks to owners and operators of assisted living facilities.
According to court documents, Thoen was a licensed registered nurse in both Florida and North Carolina. In Florida, Thoen participated in the admission to HCSN of patients who were ineligible for PHP services. Thoen participated in the routine fabrication of patient medical records that were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Medicaid.
In North Carolina, Thoen, according to court documents, routinely submitted fraudulent PHP claims for Medicare patients who were not even present at the CMHC on days PHP services were purportedly rendered. Thoen also caused the submission of fraudulent Medicare claims on days the CMHC was closed due to snow.
Thoen also admitted to his role in a money laundering scheme, involving Psychiatric Consulting Network Inc. (PCN), a Florida corporation that was utilized by HCSN as a shell corporation to launder health care fraud proceeds. According to court documents, Thoen was president of PCN.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and nine defendants have pleaded guilty. Alleged co-conspirators Wondera Eason and Paul Layman are scheduled for trial on March 11, 2013, before Judge Altonaga in Miami. And alleged co-conspirators Alina Feas, Dana Gonzalez, Gema Pampin and Lisset Palmero are scheduled for trial on June 3, 2013. Defendants are presumed innocent until proven guilty at trial.
The cases are being prosecuted by Special Trial Attorney William Parente and Trial Attorney Allan J. Medina of the Criminal Division’s Fraud Section. This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. In support of the Medicare Fraud Strike Force, the FBI Criminal Investigative Division’s Financial Crimes Section has funded the Special Trial Attorney position.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Former Registered Nurse Sentenced in Miami to 111 Months in Prison in Connection with $63 Million Mental Health Care Fraud SchemeRead the Press Release
A former registered nurse was sentenced today to serve 111 months in prison for his role in a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; Michael B. Steinbach, 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.
John Thoen, 53, of Miami, was sentenced by U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida. In addition to his prison term, Thoen was sentenced to serve three years of supervised release.
On Nov. 20, 2012, Thoen pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.
According to court documents, HCSN operated community mental health centers (CMHC) at three locations in Miami-Dade County, Fla., and one location in Hendersonville, N.C. HCSN purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness. A PHP is a form of intensive treatment for severe mental illness. According to court documents, HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not even provided. HCSN obtained those beneficiaries in Miami by paying kickbacks to owners and operators of assisted living facilities.
According to court documents, Thoen was a licensed registered nurse in both Florida and North Carolina. In Florida, Thoen participated in the admission to HCSN of patients who were ineligible for PHP services. Thoen participated in the routine fabrication of patient medical records that were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Medicaid.
In North Carolina, Thoen, according to court documents, routinely submitted fraudulent PHP claims for Medicare patients who were not even present at the CMHC on days PHP services were purportedly rendered. Thoen also caused the submission of fraudulent Medicare claims on days the CMHC was closed due to snow.
Thoen also admitted to his role in a money laundering scheme, involving Psychiatric Consulting Network Inc. (PCN), a Florida corporation that was utilized by HCSN as a shell corporation to launder health care fraud proceeds. According to court documents, Thoen was president of PCN.
According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.
Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and nine defendants have pleaded guilty. Alleged co-conspirators Wondera Eason and Paul Layman are scheduled for trial on March 11, 2013, before Judge Altonaga in Miami. And alleged co-conspirators Alina Feas, Dana Gonzalez, Gema Pampin and Lisset Palmero are scheduled for trial on June 3, 2013. Defendants are presumed innocent until proven guilty at trial.
The cases are being prosecuted by Special Trial Attorney William Parente and Trial Attorney Allan J. Medina of the Criminal Division’s Fraud Section. This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. In support of the Medicare Fraud Strike Force, the FBI Criminal Investigative Division’s Financial Crimes Section has funded the Special Trial Attorney position.
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 Prison Escapees Plead Guilty to KidnappingRead the Press Release
Jackson, Miss - Darian “Drake” Pierce, 35, of Bogalusa, Louisiana, and Ricky L. Wedgeworth, 38, of Memphis, Tennessee, pled guilty in federal court today to one count of kidnapping, announced U.S. Attorney Gregory K. Davis and Daniel McMullen, Special Agent in Charge of the Federal Bureau of Investigation.
On March 4, 2011, Pierce and Wedgeworth escaped from the Louisiana State Police Headquarters compound where they were both serving 25-year sentences. They traveled to the Fairfield Inn in Vicksburg, Mississippi where, on March 7th, they assaulted, carjacked and kidnapped the victim, David Cupps, a businessman from Sunbury Ohio. The victim died as a result of the assault by Wedgeworth and Pierce, and his body was found on March 8th in a field in Bessemer, Alabama.
The two escapees, still driving the victim’s rental car, were stopped by a Tennessee state trooper on March 8th. During the encounter, Wedgeworth claimed to be the victim before fleeing the scene with Pierce. A high-speed chase ensued near Waverly, Tennessee, before the two men abandoned the vehicle and ran into the woods. When the vehicle was recovered, the victim’s blood and DNA were found in the vehicle.
On March 14, the escapees ambushed an employee at an equestrian park in Madison County, Tennessee and fled in a county-owned Ford Ranger. The truck, driven by Wedgeworth, was seen later that day along Highway 78 near Olive Branch, Mississippi. Deputies from the Desoto County Sheriff’s Department and officers from the Olive Branch Police Department were dispatched to assist with the traffic stop. Deputies activated blue lights, but Wedgeworth failed to stop. A pursuit ensued towards Memphis, Tennessee. Deputies continued pursuing the vehicle until assistance was rendered by the Memphis Police Department, Shelby County Sherriff’s Office, and United States Marshal Service. The vehicle was later immobilized after it was struck by a police vehicle. While Wedgeworth remained inside of the vehicle, Pierce fled on foot carrying a pipe wrench. He ran into a nearby wooded area and fought with officers prior to being taken into custody.
This case was investigated by the Federal Bureau of Investigation, U.S. Marshals Service, Louisiana State Police, Vicksburg Police Department, Tennessee Bureau of Investigations, Tennessee Highway Patrol, Jefferson County Sheriff’s Department, Bessemer Police Department, Madison County (TN) Sheriff’s Department, Desoto County Sheriff’s Department, Memphis Police Department, and other state and local law enforcement agencies. It was prosecuted by Assistant U.S. Attorneys Mary Helen Wall, Richard Starrett, and Jerry Rushing.
Wedgeworth and Pierce will be sentenced on May 30, 2013. They each face a maximum penalty of life in prison.###
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Former Newark Deputy Mayor Sentenced to One Year in Prison for Extortion ConspiracyRead the Press Release
TRENTON, N.J. – Former Newark, N.J., Deputy Mayor for Public Safety Ronald Salahuddin was sentenced today to one year and one day in prison for conspiring to commit extortion by using his official position to steer demolition work to co-defendant Sonnie L. Cooper, a Newark businessman, and obtain contributions to organizations favored by Newark officials, U.S. Attorney Paul J. Fishman announced.
U.S. District Judge Freda L. Wolfson imposed the sentence today in Trenton federal court. A jury returned a guilty verdict against Salahuddin, 61, and Cooper, 69, following a five-week trial in October 2011. Salahuddin and Cooper were both convicted of one count of conspiracy to extort under the color of official right. They were each acquitted of one count of attempted extortion under the color of official right, and two counts of bribery. Salahuddin also was acquitted of an additional count of bribery.
According to documents filed in this case and the evidence at trial:Shortly after Salahuddin became deputy mayor in July 2006 and through December 2007, Salahuddin and Cooper conspired to use Salahuddin’s official position to steer City of Newark and Prudential Center demolition work to a cooperating witness who, in exchange for Salahuddin’s official action and influence, had to give a portion of that work to Cooper, the owner of S. Cooper Brothers Trucking Inc. (“Cooper Trucking”).
Salahuddin solicited and accepted contributions from the cooperating witness to organizations favored by Newark officials in exchange for his official action and influence. While deputy mayor, Salahuddin maintained a concealed financial interest in Cooper Trucking. Salahuddin mortgaged approximately $900,000 worth of property as collateral for Cooper Trucking, loaned money to Cooper for payroll and received money from Cooper related to the company’s operations.
In addition to the prison term, Judge Wolfson sentenced Salahuddin to two years of supervised release and a $5,000 fine.U.S. Attorney Fishman credited special agents of the FBI’s Trenton and Newark Field Offices, under the direction of Acting Special Agent in Charge David Velazquez; and IRS – Criminal Investigation, under the direction of Acting Special Agent in Charge Shantelle P. Kitchen, for the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Harvey Bartle of the U.S. Attorney’s Office in Trenton, and Assistant U.S. Attorneys James B. Nobile, chief of the U.S. Attorney’s Office Special Prosecutions Division, and Zahid N. Quraishi of the U.S. Attorney’s Office Special Prosecutions Division, in Newark.
13-072
Defense counsel: Thomas Ashley Esq., NewarkFormer New Jersey Resident Sentenced to Four Years in Prison for Role in Real Estate Scam That Defrauded Family FriendsRead the Press Release
Judge Also Orders Defendant to Pay $4.7 Million in Restitution
TRENTON, N.J. – An Oklahoma woman who formerly lived in Ridgewood, N.J., was sentenced today to 48 months in prison for a scheme to defraud two New Jersey families relating to the purchase, financing, and improvement of real estate in Oklahoma, U.S. Attorney Paul J. Fishman announced.
Taya Romano, (a/k/a “Taya Waldon”), 36, previously pleaded guilty before U.S. District Judge Peter G. Sheridan to an Information charging her with conspiracy to commit wire fraud. Judge Sheridan imposed the sentence today in Trenton federal court.According to documents filed in this and a related case and statements made in court:
In 2008 and 2009, Taya Romano conspired with her then-husband to solicit and obtain money from two sets of family friends in New Jersey for investments in what Romano represented to be purchases of apartment complexes and undeveloped land in Oklahoma. Romano solicited a series of investments from each of the two sets of family friends, obtaining a total of $1,032,750 from one couple and $890,000 from the other couple. Romano and her husband did not use these funds for the purposes for which they had represented.
In addition to the prison term, Judge Sheridan sentenced Romano to three years of supervised release and ordered her to pay $4.7 million in restitution.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge David Velazquez, with the investigation leading to today’s sentence.The government is represented by Assistant U.S. Attorney Bohdan Vitvitsky of the U.S. Attorney’s Economic Crimes Unit.
13-074Defense counsel: Brian J. Neary Esq., Hackensack, N.J.
Former Galleon Group Employee and Hedge Fund Founder Ali Far Sentenced in Manhattan Federal Court for Insider TradingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced that ALI FAR, a former employee of Galleon Group and founder/portfolio manager of Spherix Capital Partners, was sentenced today to one year of probation for his participation in multiple insider trading schemes during which he obtained, shared, and traded based on material, nonpublic information (“Inside Information”) stolen from several public companies. FAR pled guilty in October 2009 to one count of conspiracy to commit securities fraud and one count of securities fraud pursuant to a cooperation agreement with the government. He was sentenced today in Manhattan federal court by U.S. District Judge Robert P. Patterson.
According to the Information and statements made during FAR’s guilty plea proceeding and his sentencing:
Between 2003 and March 2009 – a period that spanned FAR’s tenure at Galleon and Spherix – he solicited Inside Information from a number of sources who provided the information in breach of duties to their employers, for purposes of trading securities. FAR traded on the Inside Information for the benefit of the hedge funds where he worked. He also shared certain Inside Information with others in the hedge fund industry in exchange for trading ideas and other Inside Information. Together, he and his co-conspirator at Spherix gained approximately $5,209,464 for their hedge fund by placing trades in Spherix accounts based on Inside Information.
For example, FAR solicited Inside Information from Ali Hariri, a family friend and technology executive, who pleaded guilty and was sentenced to prison as a result of his participation in illegal insider trading. On multiple occasions, beginning in 2008, Hariri provided FAR with Inside Information about the business performance of Hariri’s company, and FAR traded based on that Inside Information, reaping hundreds of thousands of dollars in illegal profits.
In addition to his probation, FAR, 51, of Saratoga, California, was sentenced to a fine of $100,000, a $200 special assessment, and 100 hours of community service.
Mr. Bharara praised the investigative work of the Federal Bureau of Investigation. He also thanked the U.S. Securities and Exchange Commission.
This case was brought in coordination with President Barack Obama's Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. 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 case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Reed Brodsky is in charge of the prosecution.
Former Bank Officer Sentenced for Embezzling over $142,000Read the Press Release
POCATELLO – Deanne Marie Cottle, 63, of Swan Valley, Idaho, a former vice president of Bank of Commerce of Idaho Falls, Idaho, was sentenced today to 15 months in prison for embezzling $142,008.60 from the bank, U.S. Attorney Wendy J. Olson announced. Chief U.S. District Judge B. Lynn Winmill also ordered Cottle to serve two years of supervised release after her prison term and pay a $2,000 fine. On November 27, 2012, Cottle pleaded guilty to a one-count information charging her with embezzlement by a bank employee.
According to the plea agreement, an audit conducted on September 13, 2011, found that between January 12, 2009, and September 8, 2011, Cottle, the former vice president of security and director of human resources at Bank of Commerce, converted approximately 31 checks totaling $142,008.60 from health insurance carriers to the bank. Cottle admitted that she converted the monies into cashier’s checks, which she then deposited into a personal credit union account. During a subsequent interview with the FBI, Cottle admitted that she willfully and knowingly embezzled the funds. According to the plea agreement, Cottle has made full restitution to Bank of Commerce.
The case was investigated by the Federal Bureau of Investigation.
“The detection and prosecution of the crime in this case exemplifies efforts underway by President Obama's Financial Fraud Enforcement Task Force (FFETF),” said Olson. “Thanks to the dedicated work of the FBI in this case, and the ongoing work of the FBI and other partners, the District of Idaho is proud to be a successful part of this important program. We will continue to work with our partners in the law enforcement community – federal, state and local – to identify and prosecute those who commit fraud.”
The FFETF was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
Former Alexandria Doctor Pleads Guilty to Conspiring to Distribute OxycodoneRead the Press Release
ALEXANDRIA, Va. – Larren Wade, 55, of Venice, Fl., a former doctor who had a medical practice in Alexandria, Va., pleaded guilty today to conspiring to distribute oxycodone.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Robert Brisolari, Acting Special Agent in Charge for Drug Enforcement Administration (DEA)’s Washington Field Division; Earl Cook, Alexandria Chief of Police; and Colonel W. Steven Flaherty, Virginia State Police Superintendent, made the announcement after the plea was accepted by United States District Judge Claude M. Hilton.
“Larren Wade not only violated his oath as a doctor, he violated the law when he provided a highly addictive drug to individuals for no legitimate medical reason,” said U.S. Attorney MacBride. “The abuse of prescription pills has had a devastating impact on our community, and we will continue to pursue unethical doctors who sell the drugs for their own profit.”
“Larren Wade selfishly exploited his profession by operating a drug distribution business that supplied dangerous prescription pain killers to individuals with no valid medical need,” said Assistant Director in Charge Parlave. “As demonstrated by over 200 convictions and guilty pleas in Operation Cotton Candy, the Organized Crime and Drug Enforcement Task Force is committed to the pursuit of prescription drug abuse and the FBI will continue to work with our law enforcement partners to protect our community from the dangers of these crimes.”
Wade faces a maximum penalty of 20 years in prisonwhen he is sentenced on May 17, 2013.
In a statement of facts filed with his plea agreement, Wade admitted that between March and July 2010, he issued thousands of prescriptions for pain medications, sometimes exceeding 2,000 pills per patient each month. Wade frequently issued these prescriptions without conducting a physical examination, without reviewing prior medical records, and without establishing a treatment plan. During this time, Wade also operated an almost strictly cash business and would typically see between 30 and 50 patients per day, but in at least one instance saw more than 100 patients in a single day and collected nearly $10,000 in cash.
Court records indicate that Wade was the subject of an undercover operation by law enforcement officials, and he issued numerous prescriptions for oxycodone to two undercover officers for no legitimate medical purpose. In addition, the undercover officers asked if they could obtain a prescription for a “friend” who did not exist. Wade provided two prescriptions for oxycodone for the fictitious patient after an $85 office visit fee was paid. After the transaction was completed, Wade created a patient file for the fictitious patient.
Oxycodone is the active ingredient in brand name pills such as OxyContin, Roxicodone and Percocet. It is a Schedule II controlled substance and can be useful in assisting with pain management issues; however, it has a high potential for abuse and abuse of the drug can lead to severe psychological or physical dependence.
This case was investigated by the DEA’s Washington Field Division, FBI’s Washington Field Office, Virginia State Police, and the Alexandria Police Department. Special Assistant United States Attorneys Stacey Luck and Elizabeth N. Eriksen are prosecuting the case on behalf of the United States.
This case is part of an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation dubbed Operation Cotton Candy, which has been focusing on the illegal distribution by numerous doctors, pharmacists, nurses, and patients of pain medication. This OCDETF matter has secured more than 200 drug-trafficking convictions and guilty pleas.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.Foreign National Sentenced for Controlled Substances and Immigration OffensesRead the Press Release
Abel Camacho-Ortega was sentenced in U.S. District Court in East St. Louis on February 11, 2013, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today. Camacho-Ortega, 42, a citizen of Mexico who most recently resided in Granite City, Illinois, was sentenced to eighty-seven (87) months in prison, followed by five years of supervised release. He was also order to pay a fine of $300 and a special assessment of $210. In addition, the Court entered a Judicial Order of Removal, which requires Camacho-Ortega to be deported from the United States following the service of his term of imprisonment. Camacho-Ortega had previously pled guilty on October 18, 2012, to Possession with the Intent to Distribute Methamphetamine (Count 1); Possession with the Intent to Distribute Cocaine (Count 2); and Illegal Entry into the United States Without Inspection (Count 3).
According to the Stipulation of Facts filed with the Court at the time of his plea of guilty, Camacho-Ortega was stopped by the Granite City Police Department and the Drug Enforcement Administration (DEA) on August 20, 2012, after his vehicle was observed traveling 70 miles per hour in a 45 miles per hour construction zone. After a consensual search of the vehicle, officers located packages containing 598 grams of cocaine and 449.7 grams of actual methamphetamine. Camacho-Ortega also admitted that he was present in the United States illegally.
Evidence in support of the indictment was obtained in an investigation which was conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF initiative is designed to bring federal, state, and local law enforcement agencies and resources together to identify, target and dismantle large national and international drug trafficking organizations. Participating agencies include the Drug Enforcement Administration (DEA), Internal Revenue Service, Criminal Investigations, the U.S. Immigration and Customs Enforcement Office of Homeland Security Investigations (ICE HSI), the Granite City Police Department, and the Fairview Heights Police Department. This case was assigned to Assistant United States Attorney Randy G. Massey for prosecution.
Florida Physician to Pay $26.1 Million to Resolve False Claims AllegationsRead the Press Release
Steven J. Wasserman, M.D., a dermatologist practicing in Venice, Fla., has agreed to pay $26.1 million to resolve allegations that he violated the False Claims Act by accepting illegal kickbacks from a pathology laboratory and by billing the Medicare program for medically unnecessary services, the Justice Department announced today. The settlement is the largest ever with an individual under the False Claims Act in the Middle District of Florida and one of the largest with an individual under the False Claims Act in U.S. history.
The government alleged that, in or around 1997, Dr. Wasserman entered into an illegal kickback arrangement with Tampa Pathology Laboratory (TPL), a clinical laboratory in Tampa, Fla., and Dr. José SuarezHoyos, a pathologist and the owner of TPL, in an effort to increase the lab’s referral business. Under that agreement, Dr. Wasserman allegedly sent biopsy specimens for Medicare beneficiaries to TPL for testing and diagnosis. In return, TPL allegedly provided Dr. Wasserman a diagnosis on a pathology report that included a signature line for Dr. Wasserman to make it appear to Medicare that he had performed the diagnostic work that TPL had performed. The government alleged that Dr. Wasserman then billed the Medicare program for TPL’s work, passing it off as his own, for which he received more than $6 million in Medicare payments. In addition, the government asserted that, in furtherance of his agreement with TPL, Dr. Wasserman substantially increased the number of skin biopsies he performed on Medicare patients, thus increasing the referral business for TPL.
The government further alleged that, in addition to his involvement in the alleged kickback scheme, Dr. Wasserman also performed thousands of unnecessary skin surgeries known as adjacent tissue transfers on Medicare beneficiaries. Adjacent tissue transfers are complicated and often time-consuming procedures physicians sometimes use to close a defect resulting from the removal of a growth on a patient’s skin. The government
alleged that Dr. Wasserman performed many of these procedures in order to obtain the reimbursement for them, and not because they were medically necessary.
“Doctors who take illegal kickbacks and perform unnecessary procedures not only put their own financial self-interest over their duty to their patients, they raise the cost of health care for all of us as patients and as taxpayers,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Civil Division of the Department of Justice. “The Department of Justice will not tolerate those who abuse the public health care programs to which we all contribute and on which we all depend.”
“This settlement represents a watershed achievement in our district’s civil healthcare fraud enforcement program,” said Robert O’Neill, U.S. Attorney for the Middle District of Florida. “Schemes of this magnitude require extraordinary remedies, and we are proud to have reached such an outstanding resolution for the taxpayers and their health programs.”
The allegations resolved by today’s settlement were initiated by a lawsuit originally filed in the District Court for the Middle District of Florida by Alan Freedman, M.D., a pathologist who formerly worked at TPL. Dr. Freedman filed the lawsuit under the qui tam, or whistleblower provisions of the False Claims Act. Under the False Claims Act, a private party may file suit on behalf of the United States for false claims and share in any recovery. The United States has the right to intervene in the action, which it did in this case, filing its own complaint in October 2010. Dr. Freedman will receive $4,046,000 of today’s settlement.
The United States previously settled with TPL and Dr. SuarezHoyos for $950,000 to resolve the allegations asserted against them in the same lawsuit.
“Anyone cheating patients and taxpayers should expect to pay a high price,” said Daniel R. Levinson, Inspector General of the U.S. Department of Health and Human Services. “Besides paying more than $26 million, Dr. Wasserman is excluded from treating patients and being paid under Medicare, Medicaid and all other federal health care programs.”
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.2 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14 billion.
Principal Deputy Assistant Attorney General Delery and U.S. Attorney O’Neill thanked the joint investigation team, which includes special agents with the Department of Health and Human Services-OIG and the FBI, for their efforts in the investigation of this matter.
The claims settled by this agreement are allegations only; there has been no determination of liability.
The lawsuit is captioned U.S. ex rel. Freedman v. SuarezHoyos et al., No. 04-933 (M.D. Fla.).
Federal Drug Charges Filed Against Seven Individuals for Growing Marijuana in Las Vegas-Area HomesRead the Press Release
LAS VEGAS, Nev. – Federal felony drug charges have been filed against six men and one woman for growing marijuana in homes in Henderson and Las Vegas, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Bruce Rogat, 64, Daniel Pinsonault, 57, Mark Pinsonault, 49, Ezekiel Parraz, 30, and Eli Pinsonault, 81, all of Henderson, Nev., and Jeremy Greene-Lewis, 31, and Candice Blackwell, 29, of Las Vegas, were indicted on Feb. 5, 2013, and charged with conspiracy to manufacture marijuana. The defendants are also charged variously with other drug crimes, including maintaining drug-involved premises, manufacture of a controlled substance, and possession of a controlled substance with intent to distribute, including marijuana, THC, and psilocybin.
All of the defendants, except Rogat, were arrested in Las Vegas last Thursday evening, Feb. 7, and made initial appearances before a federal magistrate judge on Friday, Feb. 8, and were released pending trial, currently set for April 9, 2013. Rogat was summoned, and is scheduled for an initial appearance and arraignment on Feb. 28, 2013, at 3:00 p.m.
According to the indictment, beginning on about Aug. 25, 2011, and continuing to Nov. 30, 2012, the defendants conspired to manufacture at least 100 marijuana plants. Three homes are alleged to have been used as marijuana grow houses - 815 Sun Bridge Lane, in Henderson; 7330 Flintstone Street in Las Vegas, and 325 New Hope Drive, in Henderson. The total number of marijuana plants involved is not specified in the indictment, other than it is over 100. The total amount of marijuana that was possessed for the purpose of distribution is alleged to be over 20 kilograms.
If convicted, the defendants face five to 40 years in prison and a fine of up to $5 million.
This case is being investigated by the DEA, the Las Vegas Metropolitan Police Department, and the Henderson Police Department, and prosecuted by Assistant U.S. Attorney Kimberly M. Frayn.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Elizabeth Medicine Top Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on February 6, 2013, before Chief U.S. District Judge Richard F. Cebull, ELIZABETH MEDICINE TOP, a 47-year-old resident of Lame Deer, appeared for sentencing. MEDICINE TOP was sentenced to a term of:
Probation: 3 years
Special Assessment: $100
Restitution: $5,144
MEDICINE TOP was sentenced in connection with her guilty plea to theft of government money.
In an Offer of Proof filed by Assistant U.S. Attorney Chad C. Spraker, the government stated it would have proved at trial the following:
On November 15, 2007, at the Social Security Administration office in Billings, MEDICINE TOP applied for Old Age, Survivor, and Disability Insurance (OASDI) auxiliary benefits for two of her children, JTF and CMT. MEDICINE TOP also applied to be a representative payee for JTF and CMT. MEDICINE TOP represented on the applications that both JTF and CMT lived with her.
In truth MEDICINE TOP had not lived with either JTF or CMT since June 2007, when MEDICINE TOP left the two children with her oldest daughter, JL, in Utah. JTF and CMT continued to live with JL and other family members until February 2008, when MEDICINE TOP retrieved JTF and CMT and moved them to MEDICINE TOP's home in Montana.
MEDICINE TOP lived with JTF and CMT until January 17, 2009, when the children went to live with MEDICINE TOP's nephew, JFH. JTF and CMT continued to live with JFH and his wife until at least May 2009.
On January 11, 2011, MEDICINE TOP was interviewed and acknowledged that she applied for OASDI benefits for JTF and CMT. MEDICINE TOP acknowledged that she knew she should have reported that JTF and CMT were not in her custody from October 2007 to January 2008, as she was receiving their benefits while the two girls were not in her care and custody. MEDICINE TOP also admitted that in January 2009, that JTF and CMT went to live with JFH, but MEDICINE TOP nevertheless continued to collect benefits on the children's behalf.
The investigation was conducted by the Social Security Administration - Office of Inspector General.
District Man Sentenced to Four Years in Prison for Robbery at Check Cashing Store-With Help from Witnesses, Police Made Quick Arrest-Read the Press Release
WASHINGTON – Michael Mitchell, 41, of Washington, D.C., was sentenced today to a four-year prison term after earlier pleading guilty to robbing a check cashing store in Northwest Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Mitchell pled guilty to a robbery charge in December 2012 in the Superior Court of the District of Columbia. He previously was convicted of multiple violent and theft-related offenses dating to the 1990s. He was sentenced by the Honorable Lynn Leibovitz. Following his prison term, Mitchell will be placed on three years of supervised release.
According to the government’s evidence, Mitchell entered a check cashing store at Georgia and New Hampshire Avenues NW at about 9:35 a.m. on Oct. 6, 2012. At the time, six other customers waited in line, including the victim. After entering the store, he approached the victim, an immigrant to the United States who worked two jobs as a nursing assistant and was in the store to send money home to her family in Uganda. Mitchell then grabbed the victim's purse and an envelope containing money for her family.
The victim fought back and Mitchell ripped the items from her hands and ran out of the store. Multiple eyewitnesses came to the victim’s aid and helped her chase after her attacker, keeping him in sight. Members of the Metropolitan Police Department (MPD) were called and caught Mitchell fleeing in the 3500 block of New Hampshire Avenue NW.
In announcing the sentence, U.S. Attorney Machen commended the work of the MPD officers and detectives who investigated the case, as well as the citizens who came forward to assist the victim. He also thanked Paralegal Assistant Todd McClelland and Intelligence Specialist Sharon Johnson for their work on this case. Finally, he acknowledged the efforts of Assistant U.S. Attorney Phil Selden, from the Superior Court Felony Major Crimes Section, who prosecuted the case.
13-048Dickinson County Woman Sentenced for Embezzling from Credit UnionRead the Press Release
TOPEKA, KAN. – A Dickinson County women has been sentenced to 36 months in federal prison for embezzling from a credit union where she worked, U.S. Attorney Barry Grissom said today. She also was ordered to pay $817,000 in restitution.
Pamela Emig, 48, Solomon, Kan., pleaded guilty to one count of embezzlement. In her plea, she admitted that from 2005 to 2011 she embezzled $817,000 while she was working for Enterprise Credit at 201 Factory in Enterprise, Kan.
Emig admitted she kited checks between accounts under her control at the credit union to cover up embezzlements and increasingly larger shortages. She would make a large deposit toward the end of the month and include the deposit in the general ledger, but the actual deposit would not be sent to the corporate checking account until the middle of the next month. At that time another larger check would be drafted out of another account at the credit union.
Grissom commended the FBI, Assistant U.S. Attorney Richard Hathaway and Assistant U.S. Attorney Christine Kenney for their work on the case.
Detroit Man Pleads Guilty to Illegal Oxycodone DistributionRead the Press Release
HUNTINGTON, W.Va. – U.S. Attorney Booth Goodwin announced today that a Detroit man pleaded guilty in federal court to distribution of a quantity oxycodone. Robert Louis Smith, 40, admitted that on March 12, 2010, he met a confidential informant at a predetermined location, entered the informant’s vehicle and distributed 229 80-milligram oxycodone tablets and 257 40-milligram oxycodone tablets. Following the controlled drug transaction, the defendant returned to his vehicle with a paper bag containing prerecorded buy money that was provided by the informant. A short time later, Smith’s vehicle was stopped by Huntington Police Department officers. Police arrested Smith and the prerecorded buy money was recovered from the passenger side rear floorboard of the defendant’s vehicle.
Smith faces up to 20 years in prison and a $1 million fine when he is sentenced on May 13, 2013 by United States District Chief Judge Robert C. Chambers.
The Drug Enforcement Administration and the Huntington Police Department conducted the investigation. Assistant United States Attorney Joseph F. Adams is in charge of the prosecution.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Departments of Justice and Health and Human Services Announce Record-Breaking Recoveries Resulting from Joint Efforts to Combat Health Care FraudRead the Press Release
Attorney General Eric Holder and Health and Human Services (HHS) Secretary Kathleen Sebelius today released a new report showing that for every dollar spent on health care-related fraud and abuse investigations in the last three years, the government recovered $7.90. This is the highest three-year average return on investment in the 16-year history of the Health Care Fraud and Abuse (HCFAC) Program.
The government’s health care fraud prevention and enforcement efforts recovered a record $4.2 billion in taxpayer dollars in Fiscal Year (FY) 2012, up from nearly $4.1 billion in FY 2011, from individuals and companies who attempted to defraud federal health programs serving seniors and taxpayers or who sought payments to which they were not entitled. Over the last four years, the administration’s enforcement efforts have recovered $14.9 billion, up from $6.7 billion over the prior four-year period. Since 1997, the HCFAC Program has returned more than $23 billion to the Medicare Trust Funds.
These findings, released today in the annual HCFAC Program report, are a result of President Obama making the elimination of fraud, waste and abuse, particularly in health care, a top priority for the administration.
The success of this joint Department of Justice and HHS effort was made possible by the Health Care Fraud Prevention and Enforcement Action Team (HEAT), created in 2009 to prevent fraud, waste and abuse in the Medicare and Medicaid programs and to crack down on individuals and entities that are abusing the system and costing American taxpayers billions of dollars. These efforts to reduce fraud will continue to improve with new tools and resources provided by the Affordable Care Act.
“This was a record-breaking year for the Departments of Justice and Health and Human Services in our collaborative effort to crack down on health care fraud and protect valuable taxpayer dollars,” said Attorney General Holder. “In the past fiscal year, our relentless pursuit of health care fraud resulted in the disruption of an array of sophisticated fraud schemes and the recovery of more taxpayer dollars than ever before. This report demonstrates our serious commitment to prosecuting health care fraud and safeguarding our world-class health care programs from abuse.”
“Our historic effort to take on the criminals who steal from Medicare and Medicaid is paying off: We are gaining the upper hand in our fight against health care fraud,” said Secretary Sebelius. “This fight against fraud strengthens the integrity of our health care programs and helps us fulfill our commitment to our seniors.”
About $4.2 billion stolen or otherwise improperly obtained from federal health care programs was recovered and returned to the Medicare Trust Funds, the Treasury and others in FY 2012. This is an unprecedented achievement for the HCFAC Program, a joint Justice Department and HHS effort to coordinate federal, state and local law enforcement activities to fight health care fraud and abuse.
The administration is also using tools authorized by the Affordable Care Act to fight fraud, including enhanced screenings and enrollment requirements, increased data sharing across the government, expanded recovery efforts for overpayments and greater oversight of private insurance abuses.
Since 2009, the Justice Department and HHS have improved their coordination through HEAT and increased the number of Medicare Fraud Strike Force teams to nine. The Justice Department’s enforcement of the civil False Claims Act and the Federal Food, Drug and Cosmetic Act have produced similar record-breaking results. These combined efforts coordinated under HEAT have expanded local partnerships and helped educate Medicare beneficiaries about how to protect themselves against fraud. In FY 2012, the two departments continued their series of regional fraud prevention summits, and the Justice Department hosted a training conference for federal prosecutors, FBI agents, HHS Office of Inspector General agents and others.
The strike force teams use advanced data analysis techniques to identify high-billing levels in health care fraud hot spots so that interagency teams can target emerging or migrating schemes as well as with chronic fraud by criminals masquerading as health care providers or suppliers. In July, Attorney General Holder and Secretary Sebelius announced the launch of a ground-breaking partnership among the federal government, state officials, leading private health insurance organizations and other health care anti-fraud groups to share information and best practices to improve detection of and prevent payments to scams that cut across public and private payers.
In FY 2012, the Justice Department opened 1,131 new criminal health care fraud investigations involving 2,148 potential defendants, and a total of 826 defendants were convicted of health care fraud-related crimes during the year. The department also opened 885 new civil investigations.
The strike force coordinated a takedown in May 2012 that involved the highest number of false Medicare billings in the history of the strike force program. The takedown involved 107 individuals, including doctors and nurses, in seven cities, who were charged for their alleged participation in Medicare fraud schemes, involving about $452 million in false billings. As a part of the May 2012 takedown, HHS also suspended or took other administrative action against 52 providers using authority under the health care law to suspend payments until an investigation is complete.
Strike force operations in the nine cities where teams are based resulted in 117 indictments, informations and complaints involving charges against 278 defendants who allegedly billed Medicare more than $1.5 billion in fraudulent schemes. In FY 2012, 251 guilty pleas and 13 jury trials were litigated, with guilty verdicts against 29 defendants, in strike force cases. The average prison sentence in these cases was more than 48 months.
The new authorities under the Affordable Care Act granted to HHS and the Centers for Medicare & Medicaid Services (CMS) were instrumental in clamping down on fraudulent activity in health care. In FY 2012, CMS began the process of screening all 1.5 million Medicare-enrolled providers through the new Automated Provider Screening system that quickly identifies ineligible and potentially fraudulent providers and suppliers prior to enrollment or revalidation to verify the data. As a result, nearly 150,000 ineligible providers have already been eliminated from Medicare’s billing system.
CMS also established the Command Center to improve health care-related fraud detection and investigation, drive innovation and help reduce fraud and improper payments in Medicare and Medicaid.
From May 2011 through the end of 2012, more than 400,000 providers were subject to the new screening requirements and nearly 150,000 lost the ability to bill the Medicare program due to the Affordable Care Act requirements and other proactive initiatives.
The Department of Justice and HHS also continued their successes in civil health care fraud enforcement during FY 2012. The Justice Department’s Civil Division Fraud Section, with their colleagues in U.S. Attorneys’ offices throughout the country, obtained settlements and judgments of more than $3 billion in FY 2012 under the False Claims Act (FCA). These matters included unlawful pricing by pharmaceutical manufacturers, illegal marketing of medical devices and pharmaceutical products for uses not approved by the Food and Drug Administration, Medicare fraud by hospitals and other institutional providers, and violations of laws against self-referrals and kickbacks. This marked the third year in a row that more than $2 billion has been recovered in FCA health care matters. Additionally, the Civil Division’s Consumer Protection Branch, working with U.S. Attorneys’ offices, obtained nearly $1.5 billion in fines and forfeitures, and obtained 14 convictions in matters pursued under the Federal Food, Drug and Cosmetic Act.
For more information on the joint DOJ-HHS Strike Force activities, visit: www.StopMedicareFraud.gov.
For more information on the fraud prevention accomplishments under the Affordable Care Act visit: http://www.healthcare.gov/news/factsheets/2012/02/medicare-fraud02142012a.html.
Related Material:
- FY 2012 HCFAC Report
Corey Moore Convicted on Federal Drug and Gun ChargesRead the Press Release
Greenbelt, Maryland - U.S. District Judge Alexander Williams, Jr. convicted Corey Moore, age 37, of Takoma Park, Maryland, today after a one week bench trial, of possession with intent to distribute controlled substances, specifically cocaine and phencyclidine (PCP); possession of firearms in furtherance of a drug trafficking crime; and being a felon in possession of guns and ammunition.
The conviction was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Steven L. Gerido of the Bureau of Alcohol, Tobacco, Firearms and Explosives - Baltimore Field Division; Chief Alan Goldberg of the Takoma Park Police Department; Chief J. Thomas Manger of the Montgomery County Police Department; and Montgomery County State’s Attorney John McCarthy.
“Corey Moore will no longer sell drugs and foment violence on the streets of Maryland and D.C.,” said U.S. Attorney Rod J. Rosenstein.
According to evidence presented at trial, on September 25, 2010, Moore possessed with intent to distribute powder cocaine, which was recovered by Takoma Park police after a chase. In addition, on September 27, 2010, police executed a search warrant at Moore’s residence and seized one kilogram or more of PCP, which Moore intended to distribute, as well as a .44 caliber, semi-automatic pistol, a.38 caliber revolver, and six rounds of .38 caliber ammunition. Trial testimony showed that Moore possessed the guns to further his drug trafficking and that Moore was prohibited from possessing the guns and ammunition due to a previous felony conviction.
Moore faces a maximum sentence of 20 years in prison for possession with intent to distribute cocaine; a minimum of 10 years and a maximum of life in prison for possession with intent to distribute one kilogram or more of PCP; five years in prison, consecutive to any other sentence imposed, for possession of a firearm in furtherance of a drug trafficking crime; and a maximum of 10 years in prison for being a felon in possession of guns and ammunition. Moore remains detained pending his sentencing, which has been scheduled for May 30, 2013.
United States Attorney Rod J. Rosenstein praised ATF, the Takoma Park Police Department, Montgomery County Police Department and the Montgomery County State’s Attorney’s Office for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Jonathan Lenzner, Steven E. Swaney, and Mara Zusman Greenberg, who are prosecuting the case and Assistant U.S. Attorney Jonathan Biran, who assisted with the prosecution.
Coast Guard Petty Officer Convicted of Stealing Government PropertyRead the Press Release
HOUSTON – Brandon Lee Scott, U.S. Coast Guard Petty Officer Second Class, of Dickinson, has entered a plea of guilty to theft of government property, United States Attorney Kenneth Magidson announced today.
At the hearing, Scott, 28, acknowledged the United States could prove he utilized a government issued credit card to buy nearly $3000 worth of electronics for his personal benefit. On June 30, 2011, Scott admitted he used a J.P. Morgan Chase purchase card to buy a 55-inch Samsung High Definition television set and two 10-inch Android WiFi gTablets having a total value of $2,659.97.
U.S. District Judge Vanessa D. Gilmore, who accepted the guilty plea, has set sentencing for April 29, 2013, at which time faces up to 10 years in federal prison and a possible $250,000 fine. Scott was permitted to remain on bond pending that hearing.The charge against Scott resulting in today’s guilty plea was the result of an investigation conducted by the U.S. Coast Guard Investigative Service and the Department of Homeland Security-Office of Inspector General. Assistant United States Attorney Daniel C. Rodriguez is prosecuting the case.
Charlotte Jury Convicts Woman in $650,000 Medicaid Fraud SchemeRead the Press Release
Ninety Percent of the Defendant’s Claims for Mental and Behavioral Health Services Were Fraudulent
CHARLOTTE, N.C. – A federal jury sitting in Charlotte convicted a Charlotte woman late Friday, February 8, 2013 of defrauding Medicaid of at least $650,000, obstructing an official proceeding and making false statements in connection with a health care matter, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Tompkins is joined in making today’s announcement by Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Division (MID), and Derrick Jackson, Special Agent in Charge, Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region.
Charlotte Elizabeth Garnes, 37, of Charlotte was convicted following a weeklong trial before U.S. District Court Judge Frank D. Whitney. According to evidence presented at trial, Garnes was a Licensed Professional Counselor and was approved by Medicaid to provide mental and behavioral health services to qualified individuals. The Government’s evidence showed that Garnes claimed to have personally provided mental health services to Medicaid recipients when in fact she did not. Instead, as evidence established, the defendant conspired with others – who were not licensed and not approved by Medicaid – to permit those unqualified individuals to submit claims to Medicaid under the Defendant’s provider number for therapy services purportedly provided by those individuals. In reality, most of the services were never provided.
According to evidence presented at trial, Garnes agreed with Teresa Marible, Michele Jackson (a/k/a Sylvia Jackson) and others to falsely put Garnes’ name and Medicaid provider number on claims for therapy services supposedly provided by the co-conspirators. The Government established that after Medicaid paid Garnes for these false claims, Garnes kept 30% of the fraud proceeds and distributed the remainder to her co-conspirators. From March 2009 to April 2011, Medicaid paid the Defendant and her company, Charlotte’s Insight, Inc., approximately $740,349 and approximately 90% of that amount ($666,062) was based upon false claims for services that Garnes did not provide.
During trial, the Government established that many of the claimed services were never provided at all. Numerous Medicaid recipients or their parents testified at trial that they or their children never received the therapy services that Garnes claimed to have provided. For many of the claimed dates of services Garnes was not in North Carolina or in the country. In fact, the defendant billed Medicaid for therapy services she claimed to have provided while she was in Germany working on a government contract, all according to trial evidence. The evidence also established that Garnes routinely billed for more than 24 hours of therapy services in a single day, including allegedly providing 69 hours of individual therapy services in a single day in December 2009.
Trial evidence demonstrated that the Defendant purchased a Mercedes vehicle and plastic surgery with the fraud proceeds.
Garnes, who was convicted on all twelve counts charged in the indictment, has been released on bond. She faces a statutory maximum sentence of 10 years in prison and a $250,000 fine for count one. Count two carries a statutory maximum sentence of 20 years in prison and a $250,000 fine. Counts three through twelve carry a statutory maximum sentence of five years in prison and a $250,000 fine. A sentencing date for Garnes has not been set yet.
Teresa Marible was sentenced in June 2012 to serve 36 month in prison for her role in the scheme, and was ordered to pay $1,135,662 in restitution. Michele Jackson was sentenced in March 2012 to 15 months in prison and was ordered to pay $292,282 in restitution.
The investigation was handled by HHS-OIG and MID. The prosecution of the case is handled by Assistant U.S. Attorneys Kelli Ferry and Jenny Grus Sugar of the U.S. Attorney’s Charlotte Office.
The investigation and charges are the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The Task Force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistle blower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The Task Force builds upon existing partnerships between the agencies and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447- 8477 (1-800-HHS-TIPS), or E-Mail at [email protected]. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.
Canadian Drug Dealer Pleads Guilty to Drug Trafficking and Money LaunderingRead the Press Release
Dung Ngoc Nguyen, 53, of Mississauga, Ontario, Canada, pleaded guilty today to drug trafficking and money laundering charges before the Honorable Lawrence F. Stengel. Sentencing is scheduled for May 8, 2013.
During the summer of 2006, special agents with the Department of Homeland Security were investigating two Philadelphia-based drug traffickers, John Q. Le and his then-girlfriend, Hanh Duong. Le was one of the largest drug dealers on the east coast with a network of customers stretching from New Jersey to Florida. Le imported large quantities of marijuana from various drug trafficking organizations in Canada. Nguyen worked for one of these Canadian organizations as a broker. Nguyen took drug purchase orders from Le and Duong, made arrangements for the marijuana to be smuggled into the United States, and made arrangements for the drug proceeds to be smuggled back to Canada. During the duration of the conspiracy, Nguyen admitted that she arranged to smuggle between 700 and 1,000 kilograms of marijuana into the United States. The drugs were usually delivered, via courier, directly to Le's house in West Chester, PA.
The case was investigated by Immigration and Customs Enforcement Homeland Security Investigations and was prosecuted by Assistant United States Attorneys David E. Fritchey and Robert J. Livermore.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Broward County Man Charged with Possession with Intent to Distribute MarijuanaRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Alysa D. Erichs, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s, Homeland Security Investigations (ICE-HSI), announced that Broward County resident Jaime Sotomayor Vega, 35, of Hollywood, was charged on Friday, February 8, 2013 with possession with intent to distribute a controlled substance, in violation of Title 21, United States Code, Section 841(a)(1) and (b)(1)(B)(vii). If convicted, Vega faces a mandatory maximum term of incarceration of 5 years and a maximum term of incarceration of up to 40 years imprisonment.
According to the criminal complaint and information presented in Court, on February 7, 2013, while on patrol of the Intracoastal Waterway in Palm Beach County, a Town of Palm Beach law enforcement officer observed and approached the vessel operated by Vega. Vega advised he was fishing but had engine trouble and that he was just waiting for his friends to arrive with the vessel trailer. Due to this and other unusual circumstances, the officer became suspicious and called the Department of Homeland Security Investigations for assistance. While conducting further investigation, it was determined that the vessel was stolen.
A dog from the Palm Beach County Sheriff’s Office K-9 Unit was summoned to the scene and alerted to the presence of narcotics in the forward area of the vessel. Further investigation revealed several packages in various shapes, sizes, and colored wrappings were marijuana. The vessel contained approximately 96 packages of marijuana, weighing an estimated 667.85 pounds.
Mr. Ferrer commended the investigative efforts of ICE-HSI, the Town of Palm Beach Police Department, the Palm Beach County Sheriff’s Office, and U.S. Customs and Border Protection Marine Interdiction Agents. The case was prosecuted by Assistant U.S. Attorney Lothrop Morris.
A complaint is only an accusation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
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.
Bonney Lake Resident Sentenced to Prison for $700,000+ Embezzlement from Hotel GroupRead the Press Release
The former controller of a hotel group based in Tacoma, Washington was sentenced today to 24 months in prison and three years of supervised release for six counts of wire fraud, announced U.S. Attorney Jenny A. Durkan. From 2007 to 2011, HUGO LINGAT CAINGAT, JR., 59, of Bonney Lake, Washington, was employed as a controller at Aspen Lodging Group, LLC (ALG). The company owns several hotels in the United States including Hotel Murano in Tacoma. From March 2010 to December 2011, CAINGAT diverted more than $700,000 in income from the hotel group into a dormant bank account. Them he used that account to pay his bills, including significant gambling bills. At sentencing U.S. District Judge Benjamin H. Settle said, “the defendant was a man of skill and aptitude who gained the trust of his employer and then abused it.”
According to records filed in the case, CAINGAT forged documents and signatures to execute his scheme. He created duplicate invoices for inter-company payments totaling nearly $600,000, and eventually routed these payments into the dormant account. From the dormant accounts the money went to pay his credit card bills. CAINGAT was fired by the hotel group in December 2011 when the theft was discovered. The case was ultimately referred to the FBI. When agents interviewed CAINGAT at his home in May 2012, he indicated he wished to provide information on the scheme. Instead, CAINGAT purchased a one way ticket to the Philippines. CAINGAT was indicted by the grand jury in July 2012, and the process of extraditing CAINGAT from the Philippines had begun when he voluntarily returned to Washington State. CAINGAT pleaded guilty in October 2012.
In asking for a sentence of nearly three years, prosecutors noted that the scheme was sophisticated and lasted nearly two years. “The defendant committed his embezzlement through multiple sub-schemes, which involved pre-configuring of a dormant account to pay his bills, transferring funds through multiple accounts, creating false inter-company payments, and forging another employee’s signature,” prosecutors wrote in their sentencing memo.
CAINGAT was ordered to pay $750,550 in restitution. That amount includes $50,000 the company spent investigating the embezzlement.
The case was investigated by the FBI. The case was prosecuted by Assistant United States Attorney Matthew Diggs.
Baltimore Man Exiled to over 11 Years in Prison for the Armed Robbery of Jewelry Store in Columbia MallRead the Press Release
Baltimore, Maryland - U.S. District Judge Catherine C. Blake sentenced Reginald D. Dargan, Jr., age 21, of Baltimore, Maryland, today to 135 months in prison followed by five years of supervised release for the March 30, 2011 armed robbery of a jewelry store in the Columbia Mall. Judge Blake also ordered Dargan to pay restitution of $33,255.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation; Baltimore City State’s Attorney Gregg L. Bernstein; and Commissioner Anthony W. Batts of the Baltimore Police Department; and Howard County Police Chief William McMahon; and Howard County State’s Attorney Dario Broccolino.
“This is the kind of cooperative effort that results in positive outcomes,” said Howard County Police Chief William McMahon. “The case is a great example of how a collaborative team can take a potentially dangerous criminal off the streets. We appreciate the efforts of all our partners.”
According to the testimony at Dargan’s three day trial, on March 30, 2011, Dargan and two co-defendants, Deontaye Harvey and Aaron Pratt drove to Columbia Mall to commit the armed robbery. Dargan was armed with a knife and Harvey and Pratt were each armed with a gun. They entered a jewelry store in the Mall and brandishing their weapons demanded that store employees open the display cases. One employee tried to run out into the Mall to get help, but Dargan and Harvey went after him and brought him back into the store at gunpoint, while Pratt stayed in the store with the other employees. Dargan then had a store employee empty the men’s watch display into a bag that Dargan was carrying and the three robbers left the Mall.
Dargan and his co-defendants stole 35 men’s Rolex watches valued at approximately $275,475.
Pratt and Harvey, both age 22, of Baltimore, previously pleaded guilty to their roles in the scheme and were sentenced to 87 months and 162 months in prison, respectively.
United States Attorney Rod J. Rosenstein commended the FBI, Baltimore Police Department, Howard County Police Department and the Baltimore City and Howard County State’s Attorney’s Offices for their work in this investigation. Mr. Rosenstein thanked Assistant United States Attorneys Benjamin M. Block, John W. Sippel, and A. David Copperthite, who prosecuted the case.
Baltimore Immigration Judge Participates in Naturalization CeremonyRead the Press Release
BALTIMORE --Immigration Judge Lisa Dornell from the Executive Office for Immigration Review, Baltimore Immigration Court, delivered the keynote speech and administered the oath of allegiance to approximately 75 candidates during a naturalization ceremony at the George H. Fallon Federal Building in Baltimore, Md., on Feb. 8, 2012. The Baltimore District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.
Biographical Information
Attorney General Janet Reno appointed Judge Dornell in April 1995. Judge Dornell received a bachelor of arts degree in 1983 from the University of Vermont and a juris doctorate in 1986 from the University of Texas at Austin School of Law. From 1990 to 1995, Judge Dornell served as senior litigation counsel, Office of Immigration Litigation, Civil Division, Department of Justice. From 1986 to 1990, she served as a trial attorney for the former Immigration and Naturalization Service (INS), New York district office, and as an assistant general counsel, INS Headquarters, Washington, D.C. Judge Dornell lectures on immigration topics and court procedure at several local law schools. She is a member of the District of Columbia and State of Texas Bars.
- EOIR -
The Executive Office for Immigration Review (EOIR) is an agency within the Department of Justice. Under delegated authority from the Attorney General, immigration judges and the Board of Immigration Appeals interpret and adjudicate immigration cases according to United States immigration laws. EOIR’s immigration judges conduct administrative court proceedings in immigration courts located throughout the nation. They determine whether foreign-born individuals—whom the Department of Homeland Security charges with violating immigration law—should be ordered removed from the United States or should be granted relief from removal and be permitted to remain in this country. The Board of Immigration Appeals primarily reviews appeals of decisions by immigration judges. EOIR’s Office of the Chief Administrative Hearing Officer adjudicates immigration-related employment cases. EOIR is committed to ensuring fairness in all of the cases it adjudicates.
Executive Office for Immigration ReviewAlbuquerque Woman Sentenced to Six Years in Prison for Drug Trafficking Offense Involving Less Than a Gram of MethamphetamineRead the Press Release
Defendant's Sentence Enchanced Based on Career Offender StatusALBUQUERQUE – Earlier today, Christine Cardona, 35, of Albuquerque, N.M., was sentenced to 72 months in federal prison followed by three years of supervised release for her methamphetamine trafficking conviction. Cardona’s crime of conviction involved possession of 0.73 grams of methamphetamine with intent to distribute. The sentence was announced by U.S. Attorney Kenneth J. Gonzales and Thomas G. Atteberry, Special Agent in Charge of the Phoenix Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Cardona and her co-defendant Maurice Andrew, 39, also of Albuquerque, were arrested on Nov. 4, 2011. Both have been in custody since that time. On Dec. 1, 2011, Cardona and Andrew were charged in a five-count indictment. Cardona and Andrew were charged with conspiracy and possession of methamphetamine with intent to distribute. Andrew alone also was charged with two counts of being a felon in possession of a firearm and carrying a firearm in connection with a drug trafficking offense.
Cardona was arrested on Nov. 4, 2011, by officers of the Albuquerque Police Department based on a state arrest warrant after they observed her leaving a motel room in Albuquerque. At the time of her arrest, Cardona was in possession of two small baggies later analyzed and found to contain methamphetamine. After she was arrested, Cardona admitted that Andrew and she were trafficking methamphetamine. Officers found $1030.00 in small denominations when they patted down Andrews following his arrest. When officers executed search warrants on Andrews’ vehicle and the motel room rented by Cardona, they seized a small amount of methamphetamine, drug paraphernalia including a digital scale and a firearm that Andrew admitted owning.
On May 3, 2012, Andrew pled guilty to a drug trafficking conspiracy and being a felon in possession of a firearm. Andrew was prohibited from possessing firearms and ammunition because he previously was convicted of a drug trafficking offense. Andrew was sentenced to 37 months in prison on Aug. 27, 2012.
Cardona entered a guilty plea to possession of methamphetamine with intent to distribute on July 13, 2012. Although Cardona would otherwise have faced a sentence of 18 to 24 months based on the amount of drugs involved and her criminal history, her sentence was enhanced based on her status as a career offender. Court records reflect that Cardona was classified as a career offender based on five prior criminal convictions: (1) concealing her identity and failure to appear in 2000; (2) importation of marijuana in 2001; (3) receiving or transferring a stole motor vehicle in 2004; (4) concealing a person from arrest in 2006; and (5) aggravated fleeing from law enforcement in 2006. Based on those five prior convictions, Cardona had served slightly more than 27 months in prison.
This case was prosecuted as part of a federal anti-violence initiative that targets “the worst of the worst” offenders for federal prosecution. Under this anti-violence initiative, the U.S. Attorney’s Office and federal law enforcement agencies work with New Mexico’s District Attorneys and state, local and tribal law enforcement agencies to target violent or repeat offenders for federal prosecution with the goal of removing repeat offenders from communities in New Mexico for as long as possible.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Albuquerque Police Department, and was prosecuted by Assistant U.S. Attorneys Lynn W.Y. Wang and William J. Pflugrath.
10 February 2013
Former Charter School Head Sentenced for FraudRead the Press Release
PHILADELPHIA - Masai Skief, 32, of Philadelphia, PA, was sentenced today to 36 months in prison for abusing his leadership positions at a Philadelphia charter school in order to enrich himself. Skief pleaded guilty to two counts of wire fraud in August 2013. He was the chief executive officer of Harambee Institute of Science and Technology Charter School (“Harambee Charter School”) and the president and chief administrative officer of a related non-profit organization, Harambee Institute, Inc. (“Harambee Institute”). In addition to the prison term, U.S. District Court Judge Paul S. Diamond ordered Skief to pay restitution in the amount of $88,000, a $200 special assessment, and ordered three years of supervised release, during which time Skief is not permitted to work in an administrative capacity at any school or in any capacity at Harambee Institute and Charter School.
Harambee Charter School, a non-profit corporation, was established to educate children from kindergarten to eighth grade. Harambee Institute was a separate non-profit established to provide students with educational services and vocational training. For its students, Harambee Charter School created a scholarship fund intended to benefit those who intended to attend a “historically black institution of higher education in the United States.”
Skief engaged in a scheme to improperly obtain the funds of both the scholarship fund and Harambee Institute. First, Skief improperly withdrew $9,000 from the scholarship fund in order to purchase a house for himself in Philadelphia. Then, through his control of the bank accounts of Harambee Institute, Skief converted for his own personal use approximately $79,000 from Harambee Institute. He did this primarily through a series of improper cash withdrawals from the bank accounts of Harambee Institute.
Skief also made substantial efforts to conceal his illegal activities, both during and after the fraud. In particular, he attempted to disguise a significant portion of his improper cash withdrawals from the accounts of Harambee Institute as labor costs for Harambee Institute, when there were no such labor costs associated with the improper withdrawals. Skief directed an accountant to create IRS forms to reflect this false information. Skief also directed others to lie for him to federal agents and to a federal grand jury about the use of the funds that the defendant had unlawfully converted. Finally, even after agreeing to plead guilty, Skief continued to steal from Harambee Institute, taking over $12,000 in additional funds, some of which he stole while awaiting sentencing.
“This is an example of our commitment to investigating allegations of significant fraud and abuse involving education funds – taxpayer dollars that are intended for the educational development of children,” said Steven Anderson, Special Agent in Charge of the U.S. Department of Education Office of Inspector General. “Mr. Skief knowingly and willfully abused his position of trust for personal gain and did so at the expense of the children he promised to serve. Deservedly, he will now be held accountable for cheating these children, their families, and taxpayers.”
The case was investigated by the Federal Bureau of Investigation and the United States Department of Education Office of Inspector General. It was prosecuted by First Assistant United States Attorney Louis D. Lappen and Assistant United States Attorney Joseph J. Khan.
UNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525
8 February 2013
Woodstock Doctor Sentenced on Drug Distribution ChargesRead the Press Release
Albany New York--RICHARD S. HARTUNIAN, United States Attorney, Northern District of New York, announces that Dr. WAYNE D. LONGMORE, age 63, of Woodstock, New York, was sentenced on February 7, 2013, in Albany by the Honorable Lawrence E. Kahn, United States District Court Judge, to 6 months home detention, 3 years probation, 200 hours of community service, and ordered to forfeit his New York State medical license, and his DEA license to issue narcotic drugs. In addition to these penalties Dr. Longmore was ordered to pay a $200,000 money judgment which represents proceeds of his drug trafficking activities.
Dr. Longmore previously pled guilty on October 17, 2012, to a felony Information that charged him with knowingly and intentionally distributing and dispensing and possessing with intent to distribute and dispense hydrocodone, a Schedule III controlled substance, without a legitimate medical purpose and outside the usual course of professional practice, contrary to Title 21, United States Code, Sections 841(a)(1) and (b)(1)(E) and Title 21, Code of Federal Regulations, Section 1306.04.
The Plea Agreement states that:
(1) From in or around November 3, 2011, through on or about March 21, 2012, in the Northern District of New York and elsewhere, LONGMORE did knowingly and intentionally distribute and dispense and possess with intent to distribute and dispense hydrocodone, a Schedule III controlled substance, without a legitimate medical purpose and outside the usual course of professional practice.
(2) In order to earn illicit profits from his medical practice, LONGMORE wrote and issued unlawful prescriptions to individuals for drugs containing controlled substances without a legitimate medical purpose and outside the usual course of professional practice.
(3) Longmore wrote these prescriptions in return for $60 cash payments. Longmore would write the illicit prescriptions for only a 7 day period.
(4) Contrary to accepted medical practice, LONGMORE prescribed Schedule III controlled substances to individuals at their first appointment with him and without conducting a thorough
Western Pennsylvania Law Enforcement Maximizing Enforcement Efforts to Prevent Gun Violence and Prosecute Gun CrimeRead the Press Release
PITTSBURGH, Pa. - Western Pennsylvania law enforcement will continue to vigorously enforce federal and state firearms laws that target prohibited possessors, U.S. Attorney David J. Hickton, ATF Acting Asst. Special Agent in Charge Marcus Watson and others announced at a news conference today.
"Western Pennsylvania law enforcement stands united in our determination to maximize enforcement efforts to prevent gun violence and prosecute gun crime," said U.S. Attorney Hickton. "It's time to shed light on those who lie to obtain firearms for criminals, and drug users who illegally possess guns, often to trade them for drugs."
"These indictments and subsequent arrests send a clear-cut message that ATF will investigate and arrest you if you purchase, transfer or possess a firearm in violation of the law," said Acting Special Agent in Charge Donald Robinson of the ATF Philadelphia Field Division. "ATF remains dedicated to fighting violent crime, targeting the worst of the worst, and taking preventive measures to deny criminals access to firearms."Under federal law, persons are prohibited from acquiring firearms if they
- have been convicted or are under indictment for a felony;
- are fugitives from justice;
- are unlawful users of or are addicted to any controlled substances;
- have been adjudicated as mental defectives or have been involuntarily committed to a mental institution;
- are illegal aliens or are aliens admitted to the U.S. under a non-immigrant visa;
- have been dishonorably discharged from the military;
- have renounced their U.S. citizenship;
- are subject to certain domestic-violence restraining orders; or
- have been convicted if a domestic violence misdemeanor.
Federal charges against seven individuals were announced at today's news conference:
- Felix Cruz, 49, formerly of Houston, Pa., was charged via indictment. On Nov. 8, 2011, Cruz possessed firearms after being convicted of a crime punishable by more than one year in prison. The law provides for a maximum total sentence of up to 10 years in prison, a fine of up to $250,000, or both.
- Linda Daugherty, 32, of Eighty Four, Pa., charged via indictment. According to the indictment, Daugherty, on Dec. 15, 2011, provided false information to a federal firearms licensee by indicating that she was the actual buyer of a particular firearm when she was actually acting on behalf of someone else. The law provides for a maximum total sentence of up to five years in prison, a fine of up to $250,000, or both.
- Jeffrey Cochenour,41, of Charleroi, Pa., charged via indictment. According to the indictment, Cochenour, on Dec. 8, 2011, provided false information to a federal firearms licensee by indicating that he was the actual buyer of a particular firearm when he was actually acting on behalf of someone else. The law provides for a maximum total sentence of up to five years in prison, a fine of up to $250,000, or both.
- Ronald DeGrange, 46, of Monongahela, Pa., charge via indictment. According to the indictment, DeGrange, on Dec. 6, 2011, provided false information to a federal firearms licensee by indicating that he was the actual buyer of a particular firearm when he was actually acting on behalf of someone else and by indicating that he was not an unlawful user of, or addicted to, a controlled substance when he knew that he was an unlawful user of, or addicted to, a controlled substance. The law provides for a maximum total sentence of up to five years in prison, a fine of up to $250,000, or both.
- Charles Warner, 26, of 230 Lombard Street, Pittsburgh, Pa., charged via indictment. According to the eight-count indictment, on or about July 19, 2009, and on or about October 9, 2009, Warner made false statements to a federal firearms licensee in connection with his purchase of two firearms. According to the indictment, on those dates, Warner also was a fugitive from justice, had pending felony drug and firearms charges, and was an unlawful user or addict of controlled substances when he possessed those firearms. The law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both.
- Michael Howard, 28 of Venetia, Pa., charged via indictment. According to the three-count indictment, Howard, on March 6, 2010, and again on July 29, 2010, provided false information to a federal firearms licensee. In addition, according to the indictment, from March 6, 2010, to May 16, 2012, Howard possessed firearms while using or being addicted to a controlled substance. The law provides for a maximum total sentence of up to 20 years in prison, a fine of up to $750,000, or both.
- Eric Beverly, 19, of 259 Fern Street, Pittsburgh, Pa., charged via indictment. According to the two-count indictment, from in or around June 2012, and continuing thereafter to on or about July 27, 2012, Beverly conspired with a known individual to falsify firearms transaction records in connection with the purchase of two firearms. Specifically, the individual indicated on the records that the firearms were being purchased for herself when, in truth, the firearms were being purchased for Beverly who was prohibited from purchasing and possessing firearms due to his age. Additionally, on or about July 13, 2012, Beverly aided and abetted the individual in falsifying the firearms transaction records. The law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both. Beverly is a fugitive.
Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorneys Craig W. Haller, Troy Rivetti, Charles Eberle and John Valkovci, Jr., are prosecuting these cases on behalf of the United States.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Pennsylvania State Police, the Allegheny County Sheriff's Office, the Pittsburgh Bureau of Police and others investigated these case. These cases are being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state, and local law enforcement agencies, prosecutors, and communities to prevent, deter, and prosecute gun crime.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
State charges against 10 individuals were announced today, as well:
- Bradley Kompa, 32, of Bethel Park, false written statement to a FFL, specifically concerning drug use;
- Rose Mary Washington, 38, of Uniontown, Pa., false written statement to a FFL, specifically concerning the owner of the firearm;
- John Irwin Moeller, 47, of Canonsburg, Pa.,a prohibited person in possession of a firearm;
- Eric Beverly, 19, of Pittsburgh, Pa., conspiracy to straw purchase, and straw purchase.
- Dennis Steaves, Indiana County, Pa.
- Shakyl Black, 20, of Wilkinsburg, Pa., conspiracy to straw purchase;
- Andre Embry, 24, of Duquesne, Pa., conspiracy to straw purchase;
- Nicholas Vesely, 31, of Export, Pa., conspiracy to straw purchase, and straw purchase.
- Cynthia Joann Wiley, 28, of California, false statement to a FFL, specifically concerning the owner of the firearms.
- Olga Rivera, 49, of Houston, Pa., false statement to a FFL, specifically concerning drug use; straw purchase; and unlawfully transferred to a prohibited person.
Week in Review – South BendRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary L. Hatton
www.usdoj.gov/usao/inn/ Fax: (219) 852-2770
South Bend, Indiana -- The United States Attorney’s Office announced today that:
PLEA:
Jeffrey Scott, 52, of South Bend, Indiana, pled guilty before Magistrate Judge Christopher Nuechterlein to the felony offense of possession of child pornography.Magistrate Nuechterlein is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. Sentencing has been set for 5/19/13.This case resulted from an investigation by members of the Indiana Internet Crimes Against Children Task Force, including the Federal Bureau of Investigation and the Indiana State Police.This case is being prosecuted by Assistant United States Attorney John Maciejczyk.
DISPOSITIONS:
Corey Fair, 19, of South Bend, Indiana, was sentenced by District Judge Jon DeGuilio to 220 months imprisonment, restitution of $1143.00 and 3 years of supervised release after pleading guilty to the felony offenses of robbery.According to documents filed in this case, Fair admitted to robbing several South Bend business establishments: the Pizza Hut business on April 6, 2012; an Arbys business on April 9; and on April 11, 2012 an Express Cab driver, the Kitchenette business, the River Park Liquors business and another Pizza Hut business.This case was the result of an investigation by the Federal Bureau of Investigation.This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Daniel Young, 52, homeless in the area of Mishawaka, Indiana, was sentenced by District Judge Robert Miller, Jr. to 360 months imprisonment and lifetime supervised release after pleading guilty to the felony offense of the production of child pornography. According to documents filed in this case, Young admitted that he had the opportunity to be alone with a 5 year old female and induced the child to engage in sexually explicit conduct with him which he recorded with a video camera. This case resulted from an investigation by members of the Indiana Internet Crimes Against Children Task Force, including the Federal Bureau of Investigation, the St. Joseph County SVU and the Mishawaka Police Department.This case was prosecuted by Assistant United States Attorney John Maciejczyk.
Jesus DeLeon, Jr., 19, of South Bend, Indiana, was sentenced by District Judge Jon DeGuilio to 6 months imprisonment and 2 years of supervised release to include 6 months of location monitoring after pleading guilty to the felony offense of distribution of marijuana.According to documents filed in this case, DeLeon , Jr. assisted Oscar Ruelas traffic in marijuana in 2012. Specifically, DeLeon, Jr. delivered marijuana to Laporte County locations for Ruelas and was paid by Ruelas for these deliveries. DeLeon, Jr. also stored marijuana at his house for Ruelas – marijuana that was to be distributed. The house was located in South Bend, Indiana. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the South Bend Police Department and the MSOS.This case was prosecuted by Assistant United States Attorney Donald Schmid.
Shawn Sanders, 44, of South Bend, Indiana, was sentenced by District Judge Robert Miller, Jr. to 60 months imprisonment and 4 years of supervised release after pleading guilty to the felony offense of possession with the intent to distribute over 500 grams of cocaine.This case was the result of an investigation by the Drug Enforcement Administration.This case was prosecuted by Assistant United States Attorney Frank Schaffer.
Week in Review – HammondRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ FAX (219) 852-2770
Hammond, Indiana - The United States Attorney’s Office announced the following activity in Federal Court:
PLEAS:
Seandell Rounds, 20, of Riverdale, Illinois, a defendant in the case US v Elmore et al., pled guilty before Senior District Judge Rudy Lozano to the felony offense of robbery.These charges were filed as a result of an investigation by the Federal Bureau of Investigation and the Gary Police Department.This case is being prosecuted by Assistant United States Attorney Dean Lanter.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS:
Lance Payton, 35, of East Chicago, Indiana, was sentenced by Chief Judge Philip Simon to 100 months imprisonment and 2 years of supervised release after pleading guilty to the felony offense of possession of a firearm by a convicted felon.According to documents filed by the government in this case, a fter an altercation broke out between Lance Payton and another individual on the streets of East Chicago, Indiana, instead of leaving the scene and calling the police, Payton went across the street to his step-father’s residence and returned with a loaded, nine millimeter, semi-automatic pistol. Payton then committed numerous felony offenses with this firearm in the span of a few minutes, by pointing this loaded firearm at the other individual, then fired the gun into the air two times (committing the crime of criminal recklessness), then battered this individual with the firearm, then shot him in the shoulder and also shot out the window of this individual’s car. Payton has three prior felony convictions and five prior misdemeanor convictions. This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives HIDTA Task Force.This case was prosecuted by Assistant United States Attorney Dean Lanter.
Randall Causey, 48, of Gary, Indiana, a defendant in the case US v Chandler et al., was sentenced by Senior District Judge Rudy Lozano to 108 months imprisonment and 3 years of supervised release after being found guilty at trial of the felony offenses of conspiracy to commit wire fraud and wire fraud.According to documents filed in this case, Causey engaged in a scheme to defraud and obtain money and property by means of false and fraudulent pretenses.He, along with others, recruited five buyers and talked them into purchasing a combined total of 21 houses in the scheme. Causey told the buyers the houses were good investments despite knowing that the houses were in disrepair and located in unsafe neighborhoods. He told them the houses would be rehabilitated by his company when he knew that little if any of the necessary repairs would actually be done. He told them he would find renters to occupy the houses and maintain and manage the properties thereafter, knowing he would make no effort to do so once the house had sold and the first month or two of the mortgage had been paid.The lenders were provided false information regarding the buyers’ credit-worthiness and were falsely told buyers had made down payments and taken out seller-second mortgages. As a result, in most of the home sales, the lenders unwittingly approved financing for 100% of the purchase of the homes, leaving no cushion if the housing market declined. The financial institutions to which some of the mortgages were packaged and sold by the initial lenders eventually lost their investment as well, as all of the homes sold in the scheme were eventually foreclosed upon. This case was the result of an investigation by the Federal Bureau of Investigation.This case was prosecuted by Assistant United States Attorney Jill Koster and Emily Cremeans.
Ikedia Smith, 26, of Hammond, Indiana, was sentenced by Chief Judge Philip Simon to 60 months imprisonment after pleading guilty to the felony offense of possession of a firearm by a convicted felon.Smith has prior convictions for attempted residential entry.This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives.This case was prosecuted by Assistant United States Attorney Joshua Kolar.