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1 February 2013
Clinton Woman Pleads Guilty to Filing False Returns; Faces up to 3 Years in PrisonRead the Press Release
DAVENPORT, IA – On February 1, 2013, Regina Jimenez, age 60, of Clinton, Iowa, pled guilty to two counts of filing false tax returns, announced United States Attorney Nicholas A. Klinefeldt. Jimenez faces up to 3 years imprisonment, a fine of up to $1,000,000 and costs of prosecution on each count.
Jimenez operated AA Accounting & Tax Services, Inc. in Clinton, Iowa from approximately 2007 through 2011. Jimenez used the business to facilitate the theft of over $200,000 from a client who believed that Jimenez would use the money to pay the client’s taxes. Jimenez instead used the money for personal expenditures and did not report the stolen funds on her tax returns.
The case was investigated by Internal Revenue Service - Criminal Investigation, and is being prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
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Christopher Wayne Williams Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Missoula, on February 1, 2013, before U.S. District Judge Dana L. Christensen, CHRISTOPHER WAYNE WILLIAMS, a 38-year-old resident of Helena, appeared for sentencing. WILLIAMS was sentenced to a term of:
Prison: 5 years (Count VI) plus 130 days (Count III)
Special Assessment: $200
Supervised Release: 5 years
WILLIAMS was convicted on September 27, 2012, following a 4 day trial in federal district court in which he was found guilty of conspiracy to manufacture, distribute, and possess with intent to distribute marijuana, manufacture of marijuana, possession with the intent to distribute marijuana, and possession of a firearm during a drug trafficking offense.
Following WILLIAMS' conviction on all counts, the parties reached a post-conviction agreement in which the United States agreed to dismiss Counts I, II, VI, V, VII, and VIII, in exchange for WILLIAMS' waiver of appeal. WILLIAMS was only sentenced on Counts III and VI.
The facts established at trial proved the following:
In late 2010, the federal government began to investigate Montana Cannabis. The investigation was prompted, in part, because of complaints from the public about the activities at the former State Nursery facility. It was also prompted by complaints from employees of Montana Cannabis about WILLIAMS' volatile behavior. The employees were also worried about the manner in which firearms were part of the culture of the grow operation.
Accordingly, a number of federal agencies began to investigate the conspiracy. The investigation was extensive and included close scrutiny of the conspiracy's banking practices.
On March 14, 2011, search warrants were executed at the Helena grow operation and dispensary, the Flor residence, the Billings dispensary, and the Missoula dispensary. About 950 plants were found at the Helena grow operation. Firearms were also found at that location placed in a manner clearly intended to protect the operation from robbery. Several of the firearms were associated with Dan Nichols, a notorious criminal who served as "armed security" at the Helena grow operation. Significant amounts of marijuana were also found at the Billings, Helena, and Missoula dispensaries.
WILLIAMS showed up at the greenhouse in Helena during the search. He stated that the operation there had produced 56 cycles, each of which yielded 150 to 200 ounces of marijuana. Using the lower estimate of 150 ounces per cycle, and assuming each ounce sold at a conservative $200 an ounce, the Helena operation yielded $1,680,000 over the course of the conspiracy. Combined with the amount of proceeds produced at the Miles City address, the conspiracy produced a total of at least $1,728,000 in marijuana.
The search of the Flor residence in Miles City disclosed the presence of marijuana prepared for distribution. An extensive cache of firearms was also found in the residence. Many of those firearms were placed in a manner so that they could be used to protect the operation.
Justin Flor was at the Billings dispensary when it was searched. He had a pistol in the waistband of his pants. Justin Flor stated that his family was preparing to grow marijuana in Miles City as part of its annual outdoor grow. Justin Flor disclosed that Montana Cannabis used bank accounts and he deposited money from the sale of marijuana into at least one of the banks accounts.
Assistant U.S. Attorney Joseph E. Thaggard and Paulette L. Stewart prosecuted the case for the United States.
Following the sentencing, United States Attorney Michael W. Cotter said, "Williams repeated claims of "compliance" with Montana law are simply false. Williams is a convicted marijuana dealer who operated a drug trafficking organization outside both federal and state law. It is also important to remember that Williams used not one, but several weapons in furtherance of his drug trafficking crime. He will serve the remainder of his incarceration in a federal penitentiary. Marijuana, along with heroin, LSD and Ecstasy are all Schedule I controlled substances. Schedule I substances are defined as having no currently accepted medical use in the United States, a lack of accepted safety for use under medical supervision, and a high potential for abuse."
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that WILLIAMS will likely serve all of the time imposed by the court. In the federal system, WILLIAMS 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 following federal, state and local law enforcement agencies: the Drug Enforcement Administration, U.S. Immigration and Customs Enforcement's Homeland Security Investigations, Criminal Investigation Division of the Internal Revenue Service, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation, the Environmental Protection Agency-Criminal Investigation Division, U.S. Customs and Border Protection-Border Patrol, and the Occupational Safety and Health Administration. These federal agencies were assisted by local High Intensity Drug Trafficking Area task forces, the Northwest Drug Task Force, the Kalispell Police Department, the Flathead County Sheriff's Office, the Missoula Police Department, the Missoula County Sheriff's Office, the Missoula High Intensity Drug Trafficking Area (HIDTA) Task Force, the Great Falls Police Department, the Cascade County Sheriff's Office, the Central Montana Drug Task Force, the Billings Police Department, the Yellowstone County Sheriff's Office, the Eastern Montana High Intensity Drug Trafficking Area (HIDTA) Task Force, the Dillon Police Department, the Beaverhead County Sheriff's Office, the Park County Sheriff's Office, the Bozeman Police Department, the Gallatin County Sheriff's Office, the Belgrade Police Department, the Missouri River Drug Task Force, the Helena Police Department, the Lewis & Clark Sheriff's Office, and the Eastern Montana Drug Task Force - Miles City.
Chinese National Sent to Prison in Nearly $1 Million Bank Fraud/Identity Theft ScamRead the Press Release
HOUSTON – Xin Gu, 29, of Dalian, China, has been sentenced to prison following his convictions of conspiracy to commit bank fraud and aggravated identity theft, United States Attorney Kenneth Magidson announced today. Gu entered a plea of guilty on Tuesday, July 10, 2012, after hearing a day of trial testimony in federal court in Houston.
Today, U.S. District Judge Gray H. Miller handed Gu 30 months for the bank fraud conviction and an additional 24 months on the aggravated identity theft which must be served consecutively for a total sentence of 54 months in federal prison. Gu is expected to face deportation proceedings following his release from prison.
On Feb. 3, 2012, Gu was arrested after he posed as someone else in a Chase bank in Houston. He had presented a fraudulent passport with his picture and someone else’s information as well as other fraudulent identification documents bearing the victim’s name and identifying information. At the time of his arrest, Gu also had other receipts and withdrawal slips for other withdrawals made on the victim’s account that same day.
Seven days prior to that arrest, a fictional authorized user had been added to the victim’s business and personal accounts at a Chase Bank branch in New York without the victim’s knowledge by a man posing as the victim. Subsequently, another woman - posing as that fictional account user - then also began making withdraws on the victim’s account in Houston.
Gu and the woman posing as the victim and fictional authorized user, respectively, made withdrawals from the victim’s business and personal accounts totaling approximately $980,000 in a seven-day period. One of those purchases included a $236,000 Mercedes Benz purchased with a cashier’s check. Items found in the Mercedes allowed Secret Service agents to determine Gu knew the woman posing as the fictional account user.
The investigation into the conspiracy is ongoing.
Gu has been in custody since the date of his arrest where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The charges brought against Gu were the result of a an investigation by the United States Secret Service. This case was prosecuted by Assistant United States Attorneys John Jocher and Andrew Leuchtmann.
Chinese National Pleads Guilty to Smuggling Counterfeit Tobacco Products to U.S.Read the Press Release
PROVIDENCE, R.I. – Lin Xiao Wei, 32, a Chinese national, pleaded guilty in U.S. District Court in Providence today to importing counterfeit tobacco products into the United States from China, earmarked for Rhode Island. Wei admitted to the court that beginning in February 2012, he arranged for the shipment of a 22-foot cargo container containing counterfeit cigarettes.
Wei, who has been detained since his arrest in Miami on June 4, 2012, by the Rhode Island Food and Drug Administration, Office of Criminal Investigations (FDA-OCI) Task Force, pleaded guilty in federal court in Providence today to one count of causing the sale of counterfeit tobacco products.
Wei’s guilty plea was announced by Peter F. Neronha, United States Attorney for the District of Rhode Island, and Mark Dragonetti, Special Agent in Charge, FDA Office of Criminal Investigations (FDA-OCI).
Appearing before U.S. District Court Judge John J. McConnell, Jr., Wei admitted that he arranged for the purchase and shipment from China to the United States of a 20-foot cargo container of counterfeit Marlboro cigarettes. The cargo container, which shipping documentation claimed contained 696 cartons of leather products, was shipped from a port in China on March 27, 2012.
Between the time Wei allegedly agreed to ship the fraudulent tobacco products to the U.S., and the arrival of the cargo container through a port in Miami on April 27, 2012, several wire transactions were sent to Wei for the cost of the product and associated shipping fees. Upon arrival in Miami, FDA-OCI and Homeland Security Investigations agents seized the container.
According to information presented to the court, on June 3, 2012, Wei met at a Miami hotel with a confidential informant who was working with investigators, and an undercover FDA-OCI Task Force agent from Rhode Island. Wei discussed the shipment of the fraudulent tobacco products, as well as previous shipments of counterfeit pharmaceutical products and the availability of other fraudulent products.
Wei is scheduled to be sentenced on April 10, 2013. Causing the sale of counterfeit tobacco products carries a maximum sentence of 3 years in federal prison; a fine of $10,000; and 3 years of supervised release.
U.S. Attorney Peter Neronha thanked Wifredo A. Ferrer, United States Attorney for the District of Southern Florida, and his staff, for their assistance in this matter.
U.S. Attorney Neronha also commended FDA-OCI Rhode Island Task Force members, Rhode Island State Police, East Providence Police and North Providence Police for their efforts in this multi-jurisdictional investigation.
U.S. Attorney Peter Neronha also thanked Homeland Security Investigations and the Bureau of Alcohol, Tobacco, Firearms and Explosives for their assistance in this investigation.
The case is being prosecuted by Assistant U.S. Attorneys Richard B. Myrus and Adi Goldstein.
Contact: 401-709-5357
[email protected]Capitol Heights Pimp Sentenced to over 12 Years in Prison for Sex Trafficking of MinorsRead the Press Release
Greenbelt, Maryland - Chief U.S. District Judge Deborah K. Chasanow sentenced Dennis Smith, a/k/a Domo, age 31, of Capitol Heights, Maryland, today to 150 months in prison, followed by 10 years of supervised release, for transporting a minor to engage in prostitution and sex trafficking of a minor.
The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
"The sexual victimization and trafficking of children is among the highest criminal investigative priorities for the FBI here in Maryland," said Stephen Vogt, Special Agent in Charge of the FBI's Maryland office. "This case highlights the exemplary work of the Maryland Child Exploitation Task Force and further validates the significant resources incorporated into working jointly with our law enforcement partners. The FBI pledges our firm commitment in finding, investigating and prosecuting individuals who prey on young victims."
According to Smith’s plea agreement, in October 2011, Smith met a 16 year old female on a social networking site. After a month of engaging in computer chats and text messaging, Smith drove to the girl’s home and picked her up. After picking up two adult women, Smith drove them all to Richmond, where the women engaged in prostitution. Smith had the girl collect the money made by the two women for two days. Smith then photographed and advertised the girl online for sexual services. The 16 year old engaged in commercial sex acts and provided the money she made to Smith. Smith then drove the three females back to Maryland, where he again advertised the 16 year old for sexual services. The next day the girl returned home.
In February 2012, Smith again picked up the 16 year old and another 15 year old female from their high school and took them back to his home. In March 2012, law enforcement was notified that Smith was prostituting the 15 year old girl at a hotel in New Carrollton, Maryland, through an online advertisement. An undercover law enforcement officer set up a “date” with the 15 year old girl. When the officer arrived at the hotel, he identified the 15 year old girl, as well as a 17 year old girl, who were engaged in prostitution. Smith was arrested at the hotel and his laptop and cell phone were seized along with tattoo equipment.
Smith admitted that he brought the 15 and 17 year old girls to his hotel where he photographed them and advertised them online for sexual services. Smith instructed the younger girl on how much to charge clients for sexual services and she provided the money she made from prostitution to Smith. There were text messages on Smith’s cell phone between Smith and the girls that related to the girls engaging in prostitution. Both the 15 and 16 year old girls were tattooed with Smith’s nickname,“Domo.”
This case is part of the Maryland Child Exploitation Task Force efforts to combat child prostitution. The Task Force, created in 2010 is comprised of 15 members representing 10 agencies, both state and federal. Since October 2011, the TF has recovered 32 juveniles and investigated 25 cases that have resulted in state and federal prosecutions. The Task Force coordinates with the National Center for Missing and Exploited Children and the Maryland State Police Child Recovery Unit to identify missing children being advertised online for prostitution.
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 "resources" tab on the left of the page.
United States Attorney Rod J. Rosenstein commended the FBI for its work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Kristi N. O’Malley and Special Assistant U.S. Attorney LisaMarie Freitas of the U.S. Justice Department, Criminal Division, Child Exploitation and Obscenity Section, who are prosecuting the case.
Boca Raton Chiropractor Sentenced for Conspiracy to Commit Mail Fraud in Connection with Staged Accident SchemeRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Michael B. Steinbach, Acting Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), and Jeff Atwater, Florida Chief Financial Officer, announced that defendant Jennifer Adams, 39, of Boca Raton, a chiropractic doctor, was sentenced yesterday to 54 months in prison, to be followed by 3 years of supervised release. She was also ordered to pay restitution of $1,920,424.83. Adams previously pled guilty to a one-count Information charging her with conspiring with others to commit mail fraud for her role in a staged accident fraud scheme.
According to court documents, to execute the fraud scheme, the recruiters sought out drivers and their friends/family members to participate in staged accidents. Under Florida’s “No Fault” insurance law, insurers are required to provide Personal Injury Protection (PIP) coverage of $10,000 per person. The recruiters referred to the individuals whom they recruited as the “Perro” and the “Perra.” The “Perro” was the person who “caused” the staged accident. The “Perra” was the person who was the “victim” of the staged accident and whose car was struck by the “Perro’s” car. Thus, if the recruiter found a Perro with a wife and two children and a Perra with two friends, for a total of seven (7) participants, the maximum PIP benefit was $70,000.
Once the recruiters found the participants, they coached the participants on how to perform the staged accident, what to say to the police officer who responded to the scene, and on how to claim that they had been injured. Thereafter, the accident was staged. After impact, a police officer was called, and a police report was filed. After the staged accident, the Perro and Perra filed false claims with their insurance companies, alleging that they and their family members were injured.
Court documents state that the accident participants were then directed by the recruiters to chiropractic clinics that were controlled by co-defendants. The staged accident participants completed paperwork falsely asserting that they suffered injuries during the staged accident. The co-conspirators advised the participants on how to fill out the paperwork and what to say if an insurance investigator interviewed them about their injuries or treatment. The staged accident participants were instructed to sign numerous blank treatment forms that would later be submitted indicating that they had visited the clinic on a number of separate occasions for treatment, although they may have visited the clinic only once or twice. During their visits, some staged accident participants received no treatment at all, or may have received only a short exam or treatment from the chiropractor or LMT but the paperwork completed by the LMTs and chiropractors, including Dr. Adams, indicated that a full and lengthy exam and treatment was given.
According to court documents, Adams agreed to place her name on the corporate paperwork for two clinics, thus utilizing her status as a licensed Chiropractic Physician, to allow the clinics to bill insurance companies directly for PIP claims without obtaining additional licensure from the State of Florida. Those clinics were Ovy Rehabilitation Medical Center, Inc. (OVY) in West Palm Beach, Florida and Chiropractic Office of South Florida, LLC (COSF) in Palm Springs, Florida. Although Adams was named as the owner of the clinic on the corporate paperwork, the co-conspirators maintained control of the bank account and running the operations of the clinics.
Court documents state that Adams initially believed the clinics to be operating legitimately. Sometime thereafter, Adams became aware that her license and status as a Chiropractor was being used to fraudulently submit claims by U.S. Mail to insurance companies. Adams realized these patients did not require the medical treatment they sought. Adams continued to work at both clinics signing prescriptions for plans of treatment that she knew were not medically necessary and that she knew were being submitted for reimbursement to numerous insurance companies. According to court documents, from the time that Adams was told about the fraud until the clinics were closed by law enforcement, the clinics submitted fraudulent claims that resulted in more than ten insurance companies making total payments of $1,920,424.83. Defendant Adams received a salary for her work as a chiropractic physician paid from the COSF and OVY checking accounts. The bulk of the proceeds of the fraud were taken by co-conspirators.
Mr. Ferrer commended the investigative efforts of the FBI, IRS-CI, and the Florida Department of Insurance Fraud, and issued a special thanks to the National Insurance Crime Bureau (NICB) for its assistance in this investigation. Mr. Ferrer also thanked the members of the Greater Palm Beach Health Care Fraud Task Force. The case is being prosecuted by Assistant U.S. Attorney A. Marie Villafaña.
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.
Armed Bank Robber Sentenced on Bank Robbery and Firearms ChargesRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Michael B. Steinbach, Acting Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, W. Howard Harrison, Chief, Plantation Police Department, and Anthony Strianese, Chief, Delray Beach Police Department, announce that Bryan Whitehead, 32, of Miami, was sentenced today before U.S. District Judge William J. Zloch, in connection with his previous convictions after trial for bank robbery, in violation of Title 18, United States Code, Section 2113(a) and the use of a firearm during and in relation to a crime of violence, in violation of Title 18, United States Code, Section 924(c).
At today’s hearing, U.S. District Judge William J. Zloch sentenced defendant Bryan Whitehead to 471 months in prison (39.25 years) to be followed by five years of supervised release upon his release from imprisonment.
According to the Indictment, in court statements, and documents filed with the court, on May 1, 2010, a black male, later identified as Bryan Whitehead, wearing a dark nylon covering on his face, royal blue surgical scrubs, and brandishing a dark colored handgun, entered Bank of America, located at 7215 W. Atlantic Boulevard, in Delray Beach, Florida. Whitehead forced customers to the floor at gunpoint and accompanied bank employees to the vault area where he made the bank manager open one of the vault drawers. Whitehead also took money from several teller drawers and removed dye packs from the bank loot prior to departing the bank. Whitehead escaped with approximately $30,000 in cash.
Thereafter, on Monday, May 21, 2012, Whitehead entered the BB&T branch located at 450 Pine Island Road, in Plantation, Florida. Whitehead, who was wearing khaki pants and holding a firearm, entered the bank and forced a bank customer to the ground at gunpoint before pulling a black beanie over his face. From the lobby, Whitehead pointed a firearm at a bank teller and demanded that she open the door to the teller area. Whitehead removed the cash from the teller drawers and placed the cash in a dark colored cloth sack. Whitehead then demanded at gunpoint that the tellers open the vault. Once inside the vault area, Whitehead filled a cloth sack with in excess of $13,990 and thereafter fled the bank. Ultimately, Plantation Police Department captured Whitehead in a nearby gas station parking lot. During a search of the Defendant’s vehicle, officers recovered the firearm used during the commission of the offense, Whitehead’s disguise, a police scanner, and the stolen money.
Mr. Ferrer commended the investigative efforts of the FBI, the Plantation Police Department, and the Delray Beach Police Department. This case was prosecuted by Assistant U.S. Attorney Marc Anton.
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.
5 Area Residents Charged in Tax Fraud SchemeRead the Press Release
BROWNSVILLE, Texas – Five family members have been charged in an eight-count indictment alleging a tax fraud scheme that involved filing false tax returns on behalf of deceased individuals, United States Attorney Kenneth Magidson announced today along with Internal revenue Service-Criminal Investigation Special Agent in Charge Lucy Cruz.
The indictment alleges Judy Lynn McCune recruited members of her family, including her mother Loretta Ann McCune, sister Rania Ann Sanchez and sons Robert Gutierrez and Edward Gutierrez in the scheme to prepare federal tax returns and cash United States Treasury refund checks in the name of deceased individuals.
Just moments ago, Judy Lynn McCune, Sanchez and Edward Gutierrez turned themselves in to federal authorities and are expected to appear before U.S. Magistrate Judge Felix Recio today at 10:00 a.m. Loretta Ann McCune is expected to also turn herself in sometime in the near future. A warrant remains outstanding for Robert Gutierrez.
“Investigating identity theft and refund fraud is a priority for IRS-CI,” said Cruz. “Stealing identities and filing false tax returns is a serious crime that hurts innocent taxpayers. These indictments should serve as a strong warning to those who are considering similar conduct. IRS-CI is serious about investigating these crimes and holding to account those who would defraud the government.”
Judy Lynn McCune allegedly recruited her mother to prepare and file the false returns, while her sister and sons cashed refund checks issued in the name of deceased individuals, according to the indictment. The conspiracy allegedly involved obtaining Social Security numbers and dates of birth for deceased individuals through the Internet and then filing both paper and electronic federal income tax returns using the identifiers of these deceased individuals. The refunds were allegedly directly deposited in the personal bank account or mailed to the personal addresses of the accused. The indictment alleges the total scheme consisted of approximately 340 false claims totaling $763,124.
Loretta Ann McCune, Robert Gutierrez and Edward Gutierrez are charged with filing false, fictitious or fraudulent claims. The indictment further charges Judy Lynn McCune and Loretta Ann McCune with aggravated identity theft for their unlawful use of the deceased individuals name and Social Security numbers as well as theft of government money in connection with the falsely filed returns.
If convicted of the scheme to prepare federal tax returns and cash the refund checks in the name of deceased persons, all face up to 10 years in prison and a possible $250,000 fine. Judy Lynn and Loretta Ann McCune also face the same punishment if they are convicted of theft of government money. Loretta Ann McCune, Robert Gutierrez and Edward Gutierrez face a possible sentence of five years in prison if convicted of filing false, fictitious or fraudulent claims. If convicted of aggravated identity theft, Judy Lynn McCune and Loretta Ann McCune will receive an additional mandatory two-year prison term that must be served consecutive to any other prison term imposed.
IRS investigated and Assistant United States Attorney Karen Betancourt is prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.3rd Defendant in Rhode Island's Largest Cocaine Bust Sentenced to 15 1/2 Years in Federal PrisonRead the Press Release
PROVIDENCE, R.I. – Andrew Rios, 41, of California, was sentenced today in U.S. District Court in Providence to 188 months in federal prison on drug trafficking charges, announced United States Attorney Peter F. Neronha and Rhode Island Attorney General Peter F. Kilmartin. Rios was arrested in January 2011 in connection with the seizure of 65 kilos of cocaine and more than $1.2 million in cash, the single largest seizure of cocaine in Rhode Island.
U.S District Court Judge William E. Smith also ordered Rios to serve 5 years of supervised release upon completion of his prison term. Rios pleaded guilty on October 1, 2012, to one count of conspiracy to distribute and possess with the intent to distribute five kilograms or more of cocaine and one count of possessing with the intent to distribute five kilograms or more of cocaine.
Two other defendants who were arrested with Rios previously pleaded guilty to trafficking charges and have been sentenced to lengthy federal prison sentences. Armando Saucedo, 33, of California, was sentenced on November 1, 2012, to 156 months in prison; Adilson A. Reyes, 31, of Utah, was sentenced November 5, 2012, to 135 months in prison.
Beginning in September 2010, federal, state and local law enforcement agents, working in conjunction with the Rhode Island Attorney General’s office, developed information about the trafficking of cocaine from outside of Rhode Island into the state. As a result, law enforcement monitored activity at hotels in West Greenwich and Pawtucket, at a storage facility in North Kingstown, and several vehicles. In January 2011, law enforcement agents executed court authorized searches of the storage facility in North Kingstown and of two vehicles. 65 kilos of cocaine, $1.2 million in cash and a firearm were seized.
The cases were prosecuted by Assistant U.S. Attorneys Sandra R. Hebert and Paul F. Daly, Jr.
Contact: 401-709-5357
[email protected]
31 January 2013
ormer Maryland National Guard Employee at Aberdeen Proving Ground Pleads Guilty to Fraud Scheme with Losses of More than $107,000Read the Press Release
Baltimore, Maryland - Lynn Carol Williams, age 56, of Middle River, Maryland pleaded guilty today to wire fraud in connection with a scheme to misuse the corporate purchasing card and cause losses of more than $107,000 to the Freestate Challenge Academy, a Maryland National Guard program located at Aberdeen Proving Ground.
The guilty plea 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; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office and Chief Chip Honan of the Aberdeen Proving Ground Police Department.
According to her plea agreement, from October 2007, through February 2011, Williams worked as an administrative aide at Freestate Challenge Academy, a Maryland National Guard youth training program located at Aberdeen Proving Ground. Williams was authorized to use the Academy’s corporate credit card to make purchases for the Academy, and was required to prepare a monthly expense report, which included the purchasing card billing statement, original receipts, copies of the approved requisition forms, and a log of activity on the purchasing card. Once her supervisor approved the expense report, it was forwarded to the State of Maryland Military Department, which paid the account balance on the corporate purchasing card.
Williams admitted that from February 2008, through October 2010, she used the corporate credit card to buy gift cards and items over the internet for her personal use. For example, on May 18, 2010, Williams paid for two airline tickets for her and a friend to travel to Los Angeles, California, with six gift cards purchased with the corporate credit card. To conceal her fraud, Williams prepared false logs of the card activity and fictitious receipts, purportedly for office supplies, snacks for program participants and other legitimate items purchased from local stores.
Williams faces a maximum sentence of 20 years in prison for wire fraud. U.S. District Judge Richard D. Bennett scheduled sentencing for May 6, 2013 at 3:00 p.m.
United States Attorney Rod J. Rosenstein praised the FBI, Defense Criminal Investigative Service and Aberdeen Proving Ground Police for their work in the investigation. Mr. Rosenstein thanked Assistant U.S. Attorney Joyce K. McDonald, who is prosecuting the case.
Woodland Park, N.J. Man Admits Scheme to Defraud More Than 17 Charities and Non-Profit OrganizationsRead the Press Release
NEWARK, N.J. – The owner and president of GAC Consulting Group LLC (“GAC”) today admitted his role in a scheme to defraud at least 17 charities and non-profit organizations, costing them more than $750,000 in losses, U.S. Attorney Paul J. Fishman announced.
Gregory Ciccone, 36, of Woodland Park, N.J., pleaded guilty before U.S. District Judge Katharine S. Hayden in Newark federal court to one count of wire fraud and one count of filing a false tax return. On Oct. 26, 2010, Ciccone was arrested and charged with mail fraud and wire fraud in connection with his charity fraud scheme, which promised high-end prizes that were never delivered.
A Superseding Indictment returned by a federal grand jury on May 15, 2012, charged Ciccone with mail fraud, wire fraud and filing a false 2009 tax return.
According to documents filed in the case and statements made in court:
Ciccone owned and operated GAC, a business which contracted with charities and non-profit organizations and arranged for high-end prizes to be auctioned off to bidders during fund-raising events. They included: a walk-on role on the “Desperate Housewives” television show; tickets to the 2009 Tony Awards; an appearance by “C.A.,” a celebrity who is a cancer survivor; and rounds of golf at the Augusta National Golf Course in Augusta, Ga.
Ciccone convinced the charities and non-profit organizations to pay GAC both an up-front retainer and commission fees based upon his ability to provide certain prizes. Ciccone not only did not deliver the vast majority of the prizes offered to his victims, he never had the ability to do so. From October 2006 through April 2010, Ciccone’s actions caused more than $768,000 in losses to at least 17 different charities and non-profit organizations.
After his Oct. 26, 2010, arrest, Ciccone filed a false 2009 tax return on May 13, 2011, in which he failed to list certain retainer fees and commissions received from his victims, as well as gambling winnings. As part of his plea, Ciccone agreed to pay back $267,778 in criminal forfeiture.
The fraud charges to which Ciccone pleaded guilty are punishable by a maximum penalty of 20 years in prison and a maximum fine of $250,000, or twice the gain or loss caused by the offense; and a maximum penalty of three years in prison and a fine of $100,000 on the tax fraud count. Judge Hayden continued Ciccone’s bail pending sentencing. Sentencing is scheduled for May 14, 2013.
U.S. Attorney Fishman credited special agents with the FBI under the direction of Acting Special Agent in Charge David Velazquez, special agents of the IRS - Criminal Investigation, under the direction of Acting Special Agent in Charge Shantelle P. Kitchen, and criminal investigators with the U.S. Attorney’s Office’s criminal investigator program, for the investigation leading to the guilty plea.The government is represented by Assistant U.S. Attorneys Joseph Mack and Kathleen P. O’Leary of the U.S. Attorney’s Healthcare and Government Fraud Unit.
13-057
Defense counsel: Salvatore T. Alfano Esq., Bloomfield, N.J., and Louis C. Esposito Esq., Cedar Grove, N.J.
Ciccone, Gregory Superseding Indictment
Woman Indicted in Ocala for Theft of Nearly $1 Million Dollars of Treasury Department FundsRead the Press Release
Ocala, FL - United States Attorney Robert E. O'Neill announces the return by a grand jury of an indictment charging Centerria Shantia Farmer with theft of funds belonging to the U.S. Department of the Treasury. If convicted, Farmer faces a maximum penalty of 10 years in federal prison. The indictment also notifies Farmer that the United States is seeking a money judgment in the amount of $902,639.78, which represents the proceeds of the theft of government property.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Internal Revenue Service Criminal Investigation and the United States Secret Service. It will be prosecuted by Assistant United States Attorney Diidri W. Robinson.
Woman Indicted for Theft of Government PropertyRead the Press Release
Tampa, Florida - United States Attorney Robert E. O'Neill announces the unsealing of an indictment charging Kayla Noble with 12 counts of theft of government property. If convicted, she faces a maximum penalty of 10 ten years in federal prison for each count.
According to the indictment, Noble stole federal income tax refunds that were fraudulently issued in the names of 12 different taxpayers. The total loss to the United States Treasury from the fraudulently obtained income tax refunds was $102,237.
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Internal Revenue Service Criminal Investigation. It will be prosecuted by Assistant United States Attorney Matthew J. Mueller.
Virginia, Minnesota, Felon Pleads Guilty to Possessing A .38-caliber RevolverRead the Press Release
MINNEAPOLIS—Earlier today in federal court, a 48-year-old felon from the northern Minnesota community of Virginia pleaded guilty to possessing a .38-caliber revolver. John Carl Pape specifically pleaded guilty to one count of being a felon in possession of a firearm. Pape, who was indicted on October 15, 2012, entered his plea before United States District Court Judge Patrick J. Schiltz.
In his plea agreement, Pape admitted possessing the Smith & Wesson, five-shot revolver on May 6, 2012. On that day, police received a complaint that two vehicles had been vandalized in a church parking lot in Eveleth, Minnesota. One of the victims stated that her purse was stolen, and that it contained the gun and credit cards, among other items. Later that day, Pape was questioned by authorities and admitted attempting to make purchases and withdrawals with the victim’s stolen credit card. During the subsequent execution of a search warrant at Pape’s residence on May 6 and 7, 2012, officers seized items linked to the theft, including the gun.
Because he is a felon, Pape is prohibited under federal law from possessing firearms at any time. His previous St. Louis County convictions include third-degree burglary (1991 and 2004), fifth-degree possession of drugs (2007 and 2008), and fifth-degree sale of marijuana (1998).Since at least three of Pape’s prior convictions constitute crimes of violence or major drug crimes, he is subject to the federal Armed Career Criminal Act if convicted in the current federal case. That act mandates a minimum of 15 years in federal prison. For his crime, Pape faces a potential maximum penalty of life in prison. Judge Schiltz will determine Pape’s sentence at a future hearing, not yet scheduled.
This case is the result of an investigation by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant U.S. Attorney Thomas M. Hollenhorst.Virginia Man Sentenced to 37 Months in Prison for Role in Bribery and Kickback Scheme Involving Government Contracts-Defendant and His Father Laundered $401,000 in Payments to RelativeRead the Press Release
Who Threatened to Expose the Scheme-WASHINGTON – Lee A. Khan, 32, of Fairfax, Va., was sentenced today to 37 months in prison for his role in a money laundering scheme meant to keep law enforcement from learning about a larger conspiracy involving bribery, kickbacks and federal government contracts.
Khan pled guilty in May 2012 in the U.S. District Court for the District of Columbia to a charge of conspiracy to commit money laundering. Among other things, he admitted scheming to channel more than $400,000 to a relative who threatened to expose wrongdoing involving millions of dollars in government contacts issued through the U.S. Army Corps of Engineers.
The sentencing was announced by U.S. Attorney Ronald C. Machen Jr.; Debra Evans Smith, Acting Assistant Director in Charge of the FBI’s Washington Field Office; Sheila Olander, Acting Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI); Peggy E. Gustafson, Inspector General for the Small Business Administration (SBA); Robert E. Craig, Special Agent in Charge of the Mid-Atlantic Field Office of the Defense Criminal Investigative Service (DCIS), and Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).
Khan was sentenced by the Honorable Emmet G. Sullivan. As part of his plea agreement, Khan agreed to forfeit his interest in more than $1 million in bank account funds, 13 properties in Virginia, Florida, and West Virginia, and a Rolex watch. In addition, Judge Sullivan ordered him to join other conspirators in paying $401,000 in restitution to the federal government. Following completion of his prison term, Khan will be placed on three years of supervised release.
A total of 12 people have pled guilty to charges in the largest domestic bribery and bid-rigging scheme in the history of federal contracting cases, and Khan was the eighth defendant to be sentenced. All of those sentenced so far have received prison terms. All told, corrupt public officials agreed to steer government contracts from the U.S. Army Corps of Engineers and the U.S. Department of the Army in exchange for more than $30 million in bribe and kickback payments. The investigation is continuing.
Khan is one of three family members charged in the case. His father, Kerry F. Khan, 55, a former program manager for the U.S. Army Corps of Engineers, pled guilty in May 2012 to charges of bribery and conspiracy to commit money laundering in a scheme in which he received or was promised more than $26 million in payments from various contractors who submitted fraudulently inflated invoices to the government. The contracts were awarded through the U.S. Army Corps of Engineers and the Department of the Army. His uncle, Nazim Khan, 50, pled guilty to a charge of conspiracy to commit interstate transportation of stolen property.
According to the government’s evidence, Lee Khan helped his father launder $401,000 to pay one of their close family members, identified in court documents as “Khan Family Member A.” The primary purpose of the payment was to prevent the family member from disclosing information concerning bribe payments made to Kerry Khan by a former government contractor.
At the time of the money transfers, “Khan Family Member A” was incarcerated at the Alexandria Detention Center in Alexandria, Va., where he was jailed following his conviction of a federal felony drug trafficking crime. The family member wrote a letter to the former government contractor – copying Lee Khan – threatening to go to the authorities unless he received a deposit covering “the entire cost of my house and 4 cars.”
Although Lee Khan did not know the full extent of his father’s illegal conduct, he did know that the source of Kerry Khan’s funds came from unlawful activities. He orchestrated the payments to the relative through multiple accounts in August 2011 in an effort to disguise that he and his father were the source of the funds.
Lee Khan told his father that if “Khan Family Member A” cooperated with law enforcement, even after getting paid, that he would kill him or have him killed.
Lee Khan and his father were among four people arrested on Oct. 4, 2011. He has been in custody ever since. “Khan Family Member A,” meanwhile, never got control of the $401,000, which was seized by law enforcement.
In addition to Lee Khan, those who have been sentenced include:
-Nazim Khan, owner of KC Builders Custom Homes LLC, a company that helped channel money to Kerry Khan in the bribery and kickback scheme. He was sentenced in December 2012 to two years in prison and ordered to pay, along with two other defendants, a total of $611,904 in restitution. He also agreed to an order of forfeiture in the amount of $83,403.
-Harold F. Babb, the former director of contracts at Eyak Technology LLC (EyakTek), an Alaska Native-owned small business. He was sentenced in October 2012 to seven years and three months in prison and ordered to pay $9,405,230 in restitution and to forfeit a money judgment of $689,342.
-Michael A. Alexander, a former program manager with the Army Corps of Engineers. He was sentenced in September 2012 to a six-year prison term and ordered to pay $1.25 million in restitution and a $1.25 million forfeiture money judgment.
-James Edward Miller, the owner of Big Surf Construction Management LLC. He was sentenced in October 2012 to five years and 10 months in prison. Miller also was ordered to pay $9,405,230 in restitution and to forfeit a money judgment of $4,055,063 and specific property, including bank account funds, a property in Virginia Beach, three vehicles, and diamond rings and other jewelry.
-Robert L. McKinney, the president of Alpha Technology Group. He was sentenced in October 2012 to two years and nine months in prison. McKinney also was ordered to forfeit $246,000, representing the illegal proceeds he retained from the crime. In addition, he must pay $984,664 in restitution to the federal government.
-Larry G. Corbett, owner of Core Technology LLC and Enterprise Technical Solutions, Inc. He was sentenced in November 2012 to two years and three months in prison, ordered to perform 500 hours community service, and ordered to forfeit $290,000.
-Theodoros Hallas, the former Executive Vice President of Operations for Nova Datacom, LLC. He was sentenced in November 2012 to one year and three months in prison and ordered to perform 500 hours community service.
Those awaiting sentencing include Kerry Khan; Alex Cho, the former chief technology officer of Nova Datacom, LLC; Nick Park, a former employee of Nova Datacom who later opened his own business, Unisource Enterprise Inc. (UEI), and Oh Sung Kwon, also known as Thomas Kwon, the co-founder and chief executive officer of Avenciatech, Inc.,
In announcing the sentences, U.S. Attorney Machen, Acting Assistant Director in Charge Smith, Acting Special Agent in Charge Olander, Inspector General Gustafson, Special Agent in Charge Craig, and Director Robey thanked those who investigated the case from the FBI’s Washington Field Office; the Office of the Inspector General for the Small Business Administration; the Department of Defense’s Defense Criminal Investigative Service; the Defense Contract Audit Agency; the Washington Field Office of the Internal Revenue Service-Criminal Investigation, and the Army Criminal Investigation Command. They also expressed thanks to the U.S. Marshals Service for its assistance on the forfeiture matter.
They also praised the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorneys Michael K. Atkinson, Bryan Seeley, and James Smith of the Fraud and Public Corruption Section and Assistant U.S. Attorney Anthony Saler of the Asset Forfeiture and Money Laundering Section. Finally, they expressed thanks for assistance provided by former Special Assistant U.S. Attorney Christopher Dana; Forensic Accountant Maria Boodoo; Paralegal Specialists Tasha Harris, Lenisse Edloe, Shanna Hays, Taryn McLaughlin, Christopher Samson, and Nicole Wattelet, and Legal Assistants Krishawn Graham and Jessica McCormick.
13-036USP-Marion Inmate Pleads Guilty to Possessing A Weapon in PrisonRead the Press Release
Lamar Elmer Smith, 32, an inmate at the United States Penitentiary at Marion, Illinois, pled guilty today in in United States District Court in Benton to charges that he possessed a weapon in that prison, announced Stephen R. Wigginton, United States Attorney for the Southern District of Illinois. The indictment, returned by a Federal Grand Jury on November 6th, alleged that the offense occurred on August 16, 2012. The weapon Smith possessed was a 7 inch long piece of sharpened metal, which appeared to be constructed from fence material, and resembled an ice pick.
At the time he possessed the weapon, Smith was serving a 211 month sentence imposed in the Eastern District of Missouri for conspiring to distribute cocaine and possessing a firearm during a drug trafficking crime.
Sentencing was set for May 16, 2013, at 10:30 a.m. at the United States District Courthouse in Benton. At that time, Smith faces up to 5 years’ imprisonment, a $250,000 fine, and 3 years of supervised release to follow his incarceration. Federal law requires that any term of imprisonment for the weapon offense be imposed consecutively to the 211 month sentence he was already serving. Following the hearing, Smith was returned to the custody of the Federal Bureau of Prisons to await sentencing.
The case was investigated by the Federal Bureau of Investigation with the assistance of the Federal Bureau of Prisons.
The case is being prosecuted by Assistant United States Attorney James M. Cutchin.
Two Men Convicted of Orchestrating Tax Fraud Scheme That Illegally Sought Quarter Billion Dollars in Fraudulent Tax RefundsRead the Press Release
SANTA ANA, California – Two Inland Empire men who ran the Fontana-based Old Quest Foundation have been convicted of running a tax fraud scheme that resulted in more than 400 fraudulent federal income tax returns being filed with the IRS that cumulatively sought more than $250 million in fraudulent refunds.
Arturo S. Ruiz, 55, of Moreno Valley, who was the chief executive officer of Old Quest, was found guilty yesterday of one count of conspiracy to defraud the United States and 41 counts of filing false claims against the United States, including four of his own federal tax returns.
Francisco J. Mendoza, 51, of San Bernardino, who was the president of Old Quest, was also found guilty yesterday of one count of conspiracy to defraud the United States and 37 counts of filing false claims against the United States.
The two defendants, both of whom are currently being held without bond, are scheduled to be sentenced by United States District Judge Josephine Staton Tucker on May 10. As a result of this week’s convictions, Ruiz faces a statutory maximum sentence of 215 years in federal prison, and Mendoza faces a statutory maximum sentence of 195 years in federal prison.
The case against Ruiz and Mendoza stems from “Operation Stolen Treasures,” an investigation conducted by Special Agents with IRS Criminal Investigation that led to 55 people being indicted by a federal grand jury in the fall of 2011 (see: http://www.justice.gov/archive/usao/cac/Pressroom/2011/140.html). Ruiz and Mendoza were the lead defendants in a 19-defendant indictment that was at the center of Operation Stolen Treasures.
The evidence presented during a two-week trial showed that Ruiz and Mendoza fraudulently told Old Quest clients they each could receive tax refunds of hundreds of thousands of dollars by accessing “secret government accounts” through a process that included the filing of IRS Forms 1099 OID. During presentations made across the Southland, members of the Old Quest conspiracy promoted the secret account theory and other “tax defier” arguments. In an attempt to give legitimacy to the scheme, Ruiz and Mendoza falsely told clients who attended seminars that Old Quest had employees who were attorneys, accountants, CPAs and former IRS employees. Taxpayers who signed up were required to pay Old Quest fees as high as $10,000, and they were required to promise to “donate” to Old Quest 25 percent of any tax refunds they received.
In exchange for the payments, Old Quest prepared and filed false income tax returns, which routinely sought hundreds of thousands of dollars – and sometimes millions of dollars – in income tax refunds. In some cases, Old Quest filed multiple false tax returns on behalf of clients. During a search warrant executed at Old Quest’s offices, special agents with IRS Criminal Investigation seized several unfiled tax returns, including one signed tax return that falsely reported $10,500,106 in federal income tax had been withheld and fraudulently claimed a $6,868,675 tax refund.
Bank records introduced as evidence showed that Old Quest received approximately $1.9 million from clients who used the fraudulent OID scheme, a figure that includes kickbacks from tax refunds erroneously issued by the IRS. The evidence also showed that while IRS agents were searching Old Quest' s offices, Mendoza emptied more than $250,000 from one of Old Quest’s bank accounts, and that Ruiz hid the funds from authorities by depositing them into another bank account in a different name.
When customers received IRS letters warning that their tax returns were frivolous, Old Quest employees assured customers that the IRS sent letters only to “intimidate” them because the “IRS did not want to pay.” After several refund checks were erroneously issued and the IRS froze the bank accounts of the customers who had received them, Ruiz and Mendoza instructed their employees to open new accounts for customers at different banks in an attempt to avoid further IRS scrutiny. The IRS search of the Old Quest offices and computers in September 2009 revealed numerous emails and printouts of IRS publications warning of the exact same scheme that Ruiz and Mendoza were promoting.
Prior to the tax refund scheme, Ruiz and Mendoza had promoted a “land patent” program to many of the same clients, according to the evidence at trial. Under this program, Ruiz and Mendoza promised to eliminate the clients’ mortgages through an obscure and mysterious process, again in exchange for substantial fees. The land patent program quickly failed, and dozens of clients lost their homes to foreclosure.
In addition to selling the fraudulent schemes to customers across the Southland, Ruiz and Mendoza failed to report to the IRS hundreds of thousands of dollars of their own income, and they filed their own false federal income tax returns that fraudulently sought refunds. The evidence at trial showed that Ruiz bragged about not paying taxes for more than 25 years.
A total of 55 defendants were indicted as part of Operation Stolen Treasures, and with this week’s convictions of Ruiz and Mendoza 19 people now have been convicted.
Release No. 13-017
Two Florida Individuals Indicited for Aggravated Identity Theft in Connection with the Filing of False Tax ReturnsRead the Press Release
Samara Y. Henderson, 25, and Marlow S. Favors, 34, both of Tampa, Florida, were indicted by a federal grand jury in Nashville today in a 9-count indictment charging conspiracy, mail fraud and aggravated identity theft, announced Jerry E. Martin, United States Attorney for the Middle District of Tennessee.
According to the indictment, from approximately March 2011 through January 2012, Henderson and Favors were charged in a conspiracy that devised a scheme to obtain the names and social security numbers of individuals and used the personal identification to file false tax returns in the names of those individuals without their knowledge or permission. The indictment alleges that the tax returns filed in the scheme claimed false and fraudulent refunds which were loaded onto debit cards and mailed to addresses in Tennessee and Florida. Some of the tax returns filed in the scheme listed addresses on Rachel’s Lane in Hermitage, Tennessee, while other tax returns used addresses in Tampa, Florida, or Odessa, Florida, among other places, as the individual’s address.The indictment also alleges that Henderson and Favors then used the debit cards to pay for personal expenses, such as vehicles and accessories, vehicle repairs, plastic surgery procedures, ATM withdrawals and other personal expenditures.
As part of the indictment, the United States Attorney's Office is seeking a monetary judgment against Henderson and Favors of approximately $1 million, which represents the proceeds of the scheme.
If convicted, Favors and Henderson face the following maximum penalties: for conspiracy, five years in prison and a $250,000 fine for each count; mail fraud, 20 years in prison and a $250,000 fine for each count; for aggravated identity theft, two years in prison, in addition to any other terms of imprisonment imposed on the other counts, and a $250,000 fine for each count.
The case was investigated by the Internal Revenue Service - Criminal Investigation. Assistant United States Attorney Kathryn B. Ward is representing the United States.An indictment is merely an accusation and is not evidence of guilt. Defendants are presumed innocent unless and until proven guilty in a court of law.
Two Charged with Using Stolen Identities to File Fraudulent Income Tax Returns Claiming More Than $1.3 Million in RefundsRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
COLUMBUS – Internal Revenue Service agents arrested Roma L. Sims, 34, Westerville, Ohio and Samantha C. Towns, 30, Reynoldsburg, Ohio today based on criminal complaints that they filed 559 individual income tax returns for 2011 claiming total refunds of $1,312,513.89 using the stolen personal information of victims including many Kentucky residents who were receiving disability or other public assistance benefits.
Carter M. Stewart, United States Attorney for the Southern District of Ohio, and Darryl Williams, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS) announced the arrests today.
According to an affidavit filed in support of the complaints, Sims established Express Tax and Accounting on Morse Road in Columbus in December 2011 and Towns organized X-Press Taxes and Accounting Services in Reynoldsburg, Ohio in January 2012. They allegedly filed the fraudulent returns and had the refunds deposited into five bank accounts they opened and controlled.
Sims and Towns appeared before U.S. Magistrate Judge Elizabeth Preston Deavers who scheduled a detention hearing for Friday, February 1 at 2 p.m.
The complaint charges each individual with aggravated identity theft, which carries a mandatory two-year sentence, conspiracy which is punishable by five years in prison and wire fraud, which is punishable by up to 30 years in prison. If convicted, mandatory restitution to victims would be part of any sentence.
“Identity theft is a serious crime that victimizes honest taxpayers and causes immense hardship,” said Richard Weber, Chief, IRS Criminal Investigation. “Today’s actions should serve as a warning that we will continue to work with our law enforcement partners and the U.S. Attorney’s office to hold accountable those individuals who undermine our income tax system by filing false claims for refunds.”
U.S. Attorney Stewart commended the ongoing investigation by IRS agents, and Assistant U.S. Attorney Dan Brown, who is representing the United States in the case.
Allegations in a criminal complaint are accusations only. Defendants should be presumed innocent until and unless proven guilty in court.
Two Charged in Federal Indictments for Alleged Embezzlement of Federal Tax ChecksRead the Press Release
PROVIDENCE, R.I. – An investigation by Internal Revenue Service – Criminal Investigation (IRS-CI) has resulted in the federal indictment of two individuals from Providence, R.I., on charges of allegedly embezzling federal tax checks in excess of $1,000, and allegedly converting the funds for personal use, announced United States Attorney Peter F. Neronha and William P. Offord, Special Agent in Charge of the Boston Field Office of IRS-CI.
Elvy Gomez, 39, is charged with one count each of theft of government property, aggravated identity theft, fraudulent endorsement of United States Treasury checks, and money laundering. The indictment alleges that Gomez embezzled government tax checks totaling in excess of $1,000, and, without permission, used the identity of another person and that person’s bank account to deposit and withdraw funds that were fraudulently obtained. It is also alleged that Gomez used the bank account to wire $17,000 to the Dominican Republic, which had been derived from unlawful activity.
In an unrelated matter, a federal grand jury returned an indictment charging Leticia Gonzalez, 39, with one count of theft of government property. It is alleged that Gonzalez embezzled government tax checks totaling in excess of $1,000.
In addition, both defendants face forfeiture allegations of all properties which constitute, or are derived from, proceeds traceable to the embezzlement allegations.
“IRS Criminal Investigation has made investigating refund fraud, identity theft and related crimes a top priority," stated William P. Offord, Special Agent in Charge of the Boston Field Office of IRS-CI. “Law enforcement is serious about investigating these crimes and holding to account those who would defraud the government.”
An indictmentis merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The defendants will appear in federal court on dates yet to be determined for arraignment. If convicted as charged, theft of government property, fraudulent endorsement of U.S. Treasury checks and money laundering are each punishable by up to 10 years in federal prison, followed by up to 3 years supervised release; and a fine of up to $250,000. Aggravated identity theft is punishable by a mandatory sentence of two years in federal prison, followed by up to 3 years supervised release; and a fine of up to $250,000.
Agents from the U.S. Secret Service assisted in the investigation of these matters.
The cases are being prosecuted by Assistant U.S. Attorney John P. McAdams.
Contact: 401-709-5357
[email protected]Two Aryan Brotherhood of Texas Gang Members Plead Guilty to Federal Racketeering ChargesRead the Press Release
Two members of the Aryan Brotherhood of Texas gang (ABT) pleaded guilty to racketeering charges related to their membership in the ABT’s criminal enterprise, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Ben Christian Dillon, aka “Tuff,” 40, of Houston, and James Marshall Meldrum, aka “Dirty,” 40, of Dallas, each pleaded guilty today before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Dillon, Meldrum and other ABT gang members and associates, agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. Dillon, Meldrum and numerous ABT gang members met on a regular basis at various locations throughout Texas to report on gang-related business, collect dues, commit disciplinary assaults against fellow gang members and discuss acts of violence against rival gang members, among other things.
Dillon and Meldrum admitted to being ABT gang members and engaging in multiple acts in support of the criminal enterprise. Dillon admitted to trafficking in methamphetamine, acting as an enforcer to collect drug debts owed to the ABT enterprise, committing acts of arson for the gang and attempting to kill a fellow ABT gang member who had been marked for death by senior ABT officials. Meldrum admitted to trafficking in methamphetamine and severely beating a subordinate gang member.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT has expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, arson, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
According to the superseding indictment, in order to be considered for ABT membership, a person must be sponsored by another gang member. Once sponsored, a prospective member must serve an unspecified term, during which he is referred to as a prospect, while his conduct is observed by the members of the ABT.
At sentencing, Dillon and Meldrum each face a maximum penalty of life in prison. Dillon’s sentencing hearing is scheduled for April 24, 2013, and Meldrum’s sentencing hearing is scheduled for Sept. 26, 2013.
Dillon and Meldrum are two of 34 defendants charged in October 2012 with conducting racketeering activity through the ABT criminal enterprise, among other charges.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; U.S. Immigration and Customs Enforcement Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County, Texas, Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Tarrant County Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Orange County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Fort Worth, Texas, Police Department; Alvin, Texas, Police Department; Carrollton, Texas, Police Department; Montgomery County District Attorney’s Office; Atascosa County District Attorney’s Office; and the Kaufman County, Texas, District Attorney’s Office.The case is being prosecuted by David Karpel of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Jay Hileman of the Southern District of Texas.
Tuscaloosa Man Sentenced 18 Months for Possessing and Intending to Distribute SteroidsRead the Press Release
BIRMINGHAM – A federal judge today sentenced a Tuscaloosa man to 18 months in prison for possessing anabolic steroids with the intent to distribute the performance-enhancing drugs, announced U.S. Attorney Joyce White Vance and Drug Enforcement Administration Special Agent in Charge Clay A. Morris.
U.S. District Judge R. David Proctor sentenced JOHN WADE WALKER, 29, on one count of Possession with the Intent to Distribute a Controlled Substance. Walker pleaded guilty to the charge in April 2012. He is scheduled to report to prison April 10, 2013.
According to Walker’s December 2011 indictment, the steroids recovered at his Tuscaloosa home when he was arrested in August 2011 included: Dromostanolone Prioprionate Trenbolone Enanthate Testosterone Proprionate, Methenolone Enanthate, Testosterone Cypionate, Testosterone Enanthate, Nandrolone Decanoate, Testosterone Proprionate Testerone Isocaproate Testosterone Phenylproprionate, Dromostanolone Proprionate, Trenbolone Enanthate, Boldenone Undecylenate, Testosterone, Stanozolol, Oxymethelone, and Methandrostenolone.
The DEA, in conjunction with the West Alabama Drug Task Force, investigated the case. Assistant U.S. Attorney John B. Felton is prosecuting the case.
Ten Indicted on Prescription Drug ChargesRead the Press Release
LYNCHBURG, VIRGINIA -- A Federal Grand Jury sitting in the United States District Court for the Western District of Virginia in Roanoke has charged ten individuals with conspiring to possess with the intent to distribute and distribution of a variety of prescription drugs, as well as other charges.
In an indictment returned under seal on January 17, 2013 and unsealed late Wednesday following the defendants’ initial court appearances, the grand jury has charged the following:
Bryant Edward Reynolds, 47, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone and two counts of distributing oxycodone.
Danielle Norman Reynolds, 37, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone , one count of distributing adderall, one count of distributing methadone and one count of distributing oxycodone.
Mark Anthony Campbell, 47, of Bedford, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone .
Timothy Lee Goodman, 23, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone and one count of distributing suboxone.
Matthew Thomas Barlow, 24, of Bedford, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone, one count of distributing suboxone, one count of possessing with the intent to distribute oxycodone, one count of possessing with the intent to distribute distributing marijuana, one count of using a firearm in furtherance of a drug trafficking crime, one count of being a prohibited person in possession of a firearm and one count of distributing suboxone.
Jeffery Earl Reynolds, 39, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone, two counts of distributing oxycodone, one count of possessing with the intent to distribute methadone, one count of using a firearm in furtherance of a drug trafficking crime and one count of being a prohibited person in possession of a firearm.
Tony Gene Abee, 40, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone.
Dana Michelle Parker, 32, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone.
George Franklin Lynch, 38, of Thaxton, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone.
Andy Lee Dooley, 27, of Bedford, Va., with one count of conspiracy to possess with the intent to distribute and to distribute Oxycontin, oxycodone, methadone, Adderall, oxymorphone, hydromorphone and suboxone.
If convicted, each defendant faces a maximum possible penalty of up to 20 years in prison and/or a fine of up to $1,000,000 on each count.
The investigation of the case was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Virginia State Police, the Drug Enforcement Administration and the Bedford County Sheriff’s Office. Assistant United States Attorney Ashley Neese will prosecute the case for the United States.
A Grand Jury indictment is only a charge and not evidence of guilt. The defendant is entitled to a fair trial with the burden on the government to prove guilt beyond a reasonable doubt.
Telford Man Pleads Guilty to Illegal Distribution of SteroidsRead the Press Release
GREENEVILLE, Tenn. – On Jan. 30, 2013, Freddie Matthew Sergent, 30, of Telford, Tenn., pleaded guilty in U.S. District Court to unlawfully distributing anabolic steroids. Sentencing has been set for 9:00 am on August 12, 2013. Sergent faces up to 10 years in prison and a $500,000 fine.
Anabolic steroids are synthetically produced variants of the naturally occurring male hormone testosterone and are regulated under the Controlled Substances Act (CSA) as a Schedule III controlled substance. As a Schedule III controlled substance, they may not be possessed lawfully in the United States without a prescription. Distribution and possession with intent to distribute anabolic steroids by a person who is not a Drug Enforcement Agent (DEA) registrant, such as a physician or a pharmacy, is unlawful and a violation of the CSA.
From approximately 2009 to April 2012, Sergent unlawfully distributed anabolic steroids from his residence in Telford, Tenn. He obtained raw steroid powders and other materials through the U.S. mails and other carriers from sources in China. Sergent further processed and packaged the steroids into vials containing approximately 300 milliliters of a solution containing an anabolic steroid, to include the Schedule III anabolic steroid boldenone undecylenate, often referred to by the trade name “Equipoise.” He then sold the steroids to customers in eastern Tennessee as well as customers across the United States.
In March 2012 Sergent mailed a package to a customer in Michigan that was intercepted and opened pursuant to a federal search warrant. Agents found a glass bottle with a label affixed which read in part, "Equipoise 300 mg/ml." Subsequent testing by the DEA Laboratory determined the bottle to contain boldenone undecylenate, an anabolic steroid.
In April 2012, a federal search warrant was executed at Sergent’s residence. Agents recovered steroid powders, materials used to process and package steroids, syringes, computers used to order and sell steroids over the Internet, and three firearms. Sergent admitted that he had been ordering steroid powder from China, processing and packaging the steroids, and selling the steroids to customers throughout the United States, sending the steroids through the U.S. mail. He said he had sold approximately $80,000 worth of steroids at $40 per vial.
Agencies involved in this investigation which led to the charges and guilty plea included the Drug Enforcement Administration, U.S. Postal Inspection Service, Homeland Security Investigations, and the Washington County Sheriff’s Office. Assistant U.S. Attorney Neil Smith represented the United States.
Tampa Man Pleads Guilty in Tax Fraud SchemeRead the Press Release
Tampa, FL - United States Attorney Robert E. O'Neill announces that Larry Lee Northern, Jr. (29, Tampa) has pleaded guilty to theft of government funds and aggravated identity theft. Northern faces a maximum penalty of 12 years in federal prison.
According to the plea agreement, on October 6, 2011, Northern was stopped by law enforcement officers for excessive speeding. During the traffic stop, he was found to be in possession of illegal narcotics and various prepaid debit cards. Specifically, Northern possessed 15 prepaid debit cards in the names of various individuals, as well as multiple Wal-Mart Money Cards, for a total of 32 separate cards. In addition, Northern had internal corporate documents from a local healthcare company. The documents contained the personal identification information of 32 individuals. The individuals were later identified as current or former clients of the healthcare company. Northern also had $15,700.00 in cash.
Subsequent investigation determined that 12 of the 15 prepaid cards were credited with U.S. Treasury income tax refunds. The refunds on the prepaid cards, totaling $93,879.00, were obtained as a result of the filing of fraudulent income tax returns. The fraudulent returns were filed in the names of individuals who reportedly had not given Northern permission to file the returns for them. Of the 17 Wal-Mart Money Cards possessed by Northern, nine of the cards had a total of $65,463.00 loaded onto them. These were also determined to be the proceeds of fraudulently filed income tax returns. Based upon Northern’s possession of the 32 cards and cash, the total loss to the government was $175,042.00.
This case was investigated by the Internal Revenue Service Criminal Investigation, U.S. Department of Health and Human Services, and the U.S. Postal Inspection Service. It is being prosecuted by Assistant United States Attorney Amanda C. Kaiser.
Tampa Man Arrested and Charged with Making False Statements During His Naturalization ProcessRead the Press Release
Tampa, FL - United States Attorney Robert E. O’Neill announces the arrest and unsealing of a federal indictment charging Georges Jean-Philippe (48, Tampa), a/k/a Benedique Jean-Philippe, with making false statements in connection with his naturalization application. Special agents from U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) arrested Jean-Philippe yesterday at his home in Tampa. United States Magistrate Judge Anthony Porcelli ordered him detained and held without bond.
According to the indictment, Jean-Philippe made false statements in his application for naturalization to become a United States citizen. During his application for citizenship, Jean-Philippe, a citizen of Haiti, falsely withheld information that he had previously been ordered deported from the United States under a different name and thus made false statements as to his ineligibility for naturalization. As a result of those falsehoods, he illegally obtained United States citizenship, in 2008, under a name different from the one he used in his initial dealings with U.S. immigration authorities in 2002.
This case was investigated by ICE HSI. It will be prosecuted by Assistant United States Attorney Jay L. Hoffer.
Superseding Indictment Returned Against Longtime Fugitive Enrico PonzoRead the Press Release
BOSTON - A Boston man was charged today in federal court with 18 counts of racketeering, drug trafficking, witness tampering and other charges.
Enrico Ponzo, a/k/a Jeffrey John Shaw, a/k/a Jay Shaw, 44, of Boston, Mass., and Marsing, Idaho, was charged in a superseding indictment with racketeering (RICO) conspiracy including conspiracy to commit murder in aid of racketeering; attempted murder and assault with a dangerous weapon; conspiracy to distribute and to possess with intent to distribute cocaine; possession of cocaine with the intent to distribute; multiple counts of using, possessing, or carrying a firearm during or in relation to a crime of violence or a drug trafficking crime; conspiracy to use extortionate means to collect or attempt to collect extensions of credit; use of extortionate means to collect or attempt to collect extensions of credit; conspiracy to commit extortion; extortion and attempted extortion; unlawful flight to avoid prosecution; conspiracy to distribute and to possess with intent to distribute marijuana; conspiracy to launder monetary instruments; laundering of monetary instruments; witness tampering; and forfeiture.
According to the superseding indictment, from June 1989 through December 1994, the Patriarca Family of La Cosa Nostra (“Family”) engaged in various criminal activities, including multiple acts involving murder, racketeering, extortionate credit transactions, extortion and conspiracy. In or about 1991, Francis P. Salemme, a/k/a Frank Salemme, became Boss of the Family. Ponzo and his co-conspirators are alleged to have acted to usurp control of the Family by plotting and attempting to murder Salemme and others who were loyal to Salemme, or who were viewed as rivals in their efforts to control the organized criminal activity in the greater Boston area. It is further alleged that Ponzo and his co-conspirators derived income from illegal activities including extortion, loan sharking, and narcotics distribution, and to have utilized violence and the threat of violence to further their aims.
It is alleged that Ponzo and his co-conspirators engaged in a pattern of racketeering activity that included murdering and conspiring to murder Richard Devlin and Joseph Souza, and conspiring and attempting to murder Salemme, Richard Gillis, Joseph Cirame, Michael Prochilo, Stephen Rossetti and Timothy Lawrence O’Toole, Jr. It is further alleged that Ponzo and his co-conspirators conspired to possess with intent to distribute and to distribute cocaine, and that they committed various other criminal acts including extortion, the use of extortionate means to collect extensions of credit, and using, possessing, or carrying a firearm during or in relation to a crime of violence and a drug trafficking offense.
According to the superseding indictment, from approximately October 1994 through February 7, 2011, Ponzo fled with the intent to avoid prosecution. Ponzo had been a fugitive for more than 16 years when he was apprehended in Idaho in February 2011.
It is further alleged that between approximately October 1994 and March 1999, Ponzo conspired with others to distribute and to possess with intent to distribute more than a ton of marijuana, and at other times to have engaged in acts of money laundering and conspiracy to launder monetary instruments, and witness tampering.
The maximum sentence under the statute is up to life in prison, up to three years of supervised release and a $250,000 fine on each of the racketeering charges. The maximum penalty on the drug trafficking offenses is up to life in prison and a mandatory minimum of 10 years in prison, no less than five years of supervised release and a $10 million fine on each count.
United States Attorney Carmen M. Ortiz and Richard DesLauriers, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Office, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Michael Tabak and Karen Beausey of Ortiz’s Organized Crime Strike Force and Drug Task Force Units.
The details contained in the superseding indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Stratford Doctor Pays $700,000 to Settle False Claims Act AllegationsRead the Press Release
January 31, 2013David B. Fein, United States Attorney for the District of Connecticut, today announced that JAMES P. RALABATE, MD, a physician, and his professional corporation, PRIMARY CARE ASSOCIATES P.C., which is located at 2890 Main Street in Stratford, have entered into a civil settlement with the government in which they will pay $700,000 to resolve allegations that RALABATE violated the False Claims Act.
The allegations against RALABATE involve fraudulent billing to Medicare occurring over a five-year period for medical services allegedly provided at various nursing homes in Connecticut. The government alleges that RALABATE billed Medicare for high-level physician services when the services of a physician were not medically necessary. The medical records did not provide documentation necessary to meet the detailed history, examination or medical decision-making requirements necessary to justify the high level of physician care. At times, there was no medical record documenting RALABATE’s visit.
The government further alleges that RALABATE billed Medicare for services he supposedly provided to patients in nursing homes when the patients were, in fact, not present in the nursing homes. Instead, the patients had been transferred to local hospitals for treatment. Yet RALABATE billed government health care programs as if he had provided medical services in the nursing homes.
To resolve their liability under the False Claims Act, RALABATE and his professional corporation will pay $700,000 in order to reimburse the Medicare programs for conduct occurring between January 1, 2006 and August 31, 2011.
In addition, RALABATE has agreed to be subject to an Integrity Agreement with the Office of Inspector General for the U.S. Department of Health and Human Services.
“Health care providers that overcharge Medicare drain critical funds from the Medicare program and increase health care costs,” U.S. Attorney Fein stated. “The U.S. Attorney’s office is committed to vigorously pursuing physicians and other health care providers who submit fraudulent claims to federal health care programs. Providers who submit false claims to the government face serious monetary and administrative sanctions.”
Under the False Claims Act, the government can recover up to three times its actual damages, plus penalties of $5,500 to $11,000 for each false claim.
This case was investigated by the Office of Inspector General for the U.S. Department of Health and Human Services. The case was prosecuted by Assistant United States Attorney Anne F. Thidemann, with the assistance of Auditor Kevin A. Saunders.
In entering into the settlement agreement, RALABATE and PRIMARY CARE ASSOCIATES P.C. did not admit liability.
U.S. Attorney Fein encouraged individuals who suspect health care fraud to report it by calling the Health Care Fraud Task Force 203-777-6311 or 1-800-HHS-TIPS.
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(203) 821-3722 [email protected]St. Peter Man Sentenced for Transporting Illegal AliensRead the Press Release
MINNEAPOLIS—Earlier today in federal court, a St. Peter man was sentenced on one count of transporting illegal aliens. United States District Court Judge Patrick J. Schiltz sentenced Juan Arrazolo, also known as John Arrazolo, to three years of probation, six months of home confinement and a $2,000 fine. Arrazolo was indicted on April 16, 2012 and pleaded guilty on August 16, 2012.
Following today’s sentencing, Mike Feinberg, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations St. Paul Field Office (“ICE HSI”), said, “Those who transport or harbor illegal aliens require secrecy and often coercion to succeed. ICE HSI has a long history of targeting criminals who seek illegal gain at the expense of the innocent. We work with our state and local law enforcement partners to bring justice to anyone who exploits others for illegal profit.”
In his plea agreement, Arrazolo admitted that between October 2006 and October 2011, he transported two undocumented aliens from Texas to Minnesota to work in his business. Arrazolo’s company, Poultry Service Management, provided manual labor to large corporate chicken farms in Minnesota and the surrounding area. The workers loaded chickens for shipping, vaccinated chickens, trimmed chicken beaks, and provided other general labor as requested by the poultry producers. Arrazolo admitted that one of the individuals he transported was a citizen of Mexico, and that he knew the individual was not a U.S. citizen when he transported him from Texas to Minnesota.
This case was the result of an investigation by ICE HSI, the St. Peter Police Department, the Nicollet County Sheriff’s Office, the LeSueur County Sheriff’s Office, and the Minnesota Bureau of Criminal Apprehension. It was prosecuted by Assistant U.S. Attorney David P. Steinkamp.Springfield Man Sentenced for Possessing Firearms and Ammunition After Felony ConvictionRead the Press Release
BOSTON - A Springfield man was sentenced today for possessing firearms and ammunition while under felony indictment.
Manuel Lora, 23, was sentenced by U.S. District Chief Judge Patty B. Saris to 40 months in prison, followed by three years of supervised release with the special conditions that he avoid the members the Almighty Latin Kings and Eastern Avenue Posse street gangs. In September 2012, Lora pleaded guilty to possession of firearms and ammunition while under felony indictment.On May 28, 2011, at a shooting range in Springfield, Lora fired a variety of pistols and ammunition, all of which had traveled in interstate commerce. Lora, who had been previously convicted of distributing narcotics, gained access to the shooting range by falsely certifying that he had not been convicted of a crime punishable by more than one year in jail. In addition, Lora was facing pending felony charges for possession with intent to distribute a class B controlled substance near a school zone or park
United States Attorney Carmen M. Ortiz; Guy Thomas, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives Boston Field Division; Mark Mastroianni, Hampden County District Attorney; and Commissioner William Fitchett of the Springfield Police Department, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Steven H. Breslow of Ortiz=s Springfield Branch Office.Springfield Man Sentenced for Bank Fraud and Passing Counterfeit SecuritiesRead the Press Release
BOSTON - A Springfield man was sentenced today for committing bank fraud and passing counterfeit securities.
John Jordan, 52, was sentenced by U.S. District Judge Patti B. Saris to 17 months in prison, followed by one year of supervised release and $1,435 in restitution. In September 2012, Jordan pleaded guilty to four counts of bank fraud and four counts of counterfeit security fraud.Jordan created high quality counterfeit checks on his computer and then sold these checks at a discounted price to co-conspirators who would attempt to cash them at local businesses and financial institutions. Jordan surreptitiously acquired legitimate customer and corporate account information that he used on the counterfeit checks making it more likely they would be transacted.
United States Attorney Carmen M. Ortiz; Steven D. Ricciardi, Special Agent in Charge of the U.S. Secret Service; and Colonel Timothy P. Alben, Superintendent of the Massachusetts State Police, made the announcement today. The case was prosecuted by Assistant U.S. Attorney Paul Hart Smyth of Ortiz’s Springfield Branch Office.
Spencer Man Pleads Guilty to Methamphetamine ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine pled guilty January 30, 2013, in federal court in Sioux City.
Gabriel Ginger, 26, from Spencer, Iowa, was convicted of one count of conspiring to distribute methamphetamine.
At the plea hearing, Ginger admitted his involvement in a conspiracy from about 2010 through August 2011 that distributed more than 50 grams of actual (pure) methamphetamine. On July 21, 2011, law enforcement officers executed a search warrant at Ginger’s residence and seized over 10 grams of methamphetamine which Ginger planned to distribute to others.
Sentencing before United States District Court Judge Donald E. O’Brien will be set after a presentence report is prepared. Ginger remains in custody of the United States Marshal pending sentencing. Ginger faces a mandatory minimum sentence of 5 years’ imprisonment and a possible maximum sentence of 40 years’ imprisonment, a $5,000,000 fine, a special assessment of $100, and at least four years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the Iowa Department of Narcotics Enforcement, Spencer Police Department, Clay County Sheriff’s Office, Iowa Great Lakes Drug Task Force, and the Iowa Division of Criminal Investigations.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 12-4049.
Sex Offender Sentenced to 25 Years on Child Pornography ChargesRead the Press Release
BOSTON - An Ayer man who fled to Belize was sentenced today for producing, distributing and possessing child pornography.
Thomas A. Donahue, 45, was sentenced by U.S. District Judge F. Dennis Saylor, IV to 25 years in prison, followed by 10 years of supervised release. In October 2012, Donahue pleaded guilty to producing, distributing, and possessing child pornography.
Between March 2010 and February 2011, Donahue produced, distributed, and possessed child pornography, and in February 2011, a search warrant was executed at Donahue’s apartment where a laptop computer, external hard drive and other computer related media were seized. A preliminary search of the devices revealed a large quantity of images and videos depicting child pornography, including pornographic videos that depicted Donahue and a minor male. An extensive investigation led to the identification of the minor male. Sometime between the execution of the search warrant and March 7, 2011, when Donahue was charged via federal complaint, Donahue fled the country. After an extensive manhunt, Donahue was tracked to Belize and was arrested in April 2011 before he was returned to the United States to face charges.
United States Attorney Carmen M. Ortiz; Richard DesLauriers, Special Agent in Charge of the Federal Bureau of Investigation Boston Field Division; and Bruce Foucart, Special Agent in Charge of Homeland Security Investigations in Boston made the announcement today. This case was investigated with the assistance of the Bureau of Diplomatic Security Regional Security Office in Belize, and the Special Branch of the Belize Police Department. The case was prosecuted by Assistant U.S. Attorney Cory S. Flashner of Ortiz’s Worcester Branch Office.
Scranton Man Pleads Guilty to Online Enticement of MinorRead the Press Release
The United States Attorney’s Office for the Middle District of Pennsylvania announced that a 46-year-old Scranton resident pleaded guilty today before Senior U.S. District Court Judge A. Richard Caputo to attempting to entice a minor to engage in illegal sexual conduct.
According to United States Attorney Peter J. Smith, Lewis John Davies admitted to using a computer to attempt to persuade a minor to engage in sexual acts with him during April-June 2008.
Davies was indicted by a federal grand jury in June 2008, as a result of an investigation by the Federal Bureau of Investigation and the Scranton Police Department.
Under the terms of the plea agreement, if it is accepted by the court, Davies will be sentenced to between 66 months and 78 months in prison, to be followed by five years of supervised release. The agreement also requires Davies to comply with sex offender registration and treatment requirements. Davies also agreed to forfeit to the United States computers and related material used in the commission of the crime.
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 internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The case is being prosecuted by Assistant U.S. Attorney Francis P. Sempa.
San Diego Company Admits Misleading SEC as Part of Settlement Agreement Unico, Inc. Agreed to Pay A Monetary Penalty and to Submit to Oversight by A Government-Approved Monitor for A Period of at Least Three YearsRead the Press Release
United States Attorney Laura E. Duffy announced today that San Diego-based Unico, Inc. (“Unico”) entered into a negotiated settlement in which it admitted that its former CEO, Mark Anthony Lopez, made a false statement to the Securities and Exchange Commission (“SEC”) when he mischaracterized funds received from a lender. Unico also agreed to pay a monetary penalty and to submit to at least three years of oversight by a corporate monitor approved by the United States Attorney’s Office.
As part of the negotiated settlement, Unico (on January 30, 2013) entered into a deferred prosecution agreement with the United States Attorney’s Office before the Honorable William McCurine, Jr. According to the terms of the agreement, the monitor (who is required to act as an independent thirdparty) will have the power to approve—as well as veto—various business and financial decisions that Unico attempts to make. In exchange for Unico’s concessions, the United States Attorney’s Office agreed to postpone its prosecution against Unico for charges related to securities fraud, false statements and obstruction of justice.
The deferred prosecution agreement comes after the January 17, 2013 arrest of Unico’s former CEO on charges of conspiracy to commit securities fraud and obstruction of justice. According to the indictment against Lopez, he conspired with New Jersey-based stock trader Mark Allen Lefkowitz (who previously pled guilty) to manipulate the share price and volume of Unico’s stock to benefit corporate insiders at the expense of shareholders. As a result of the fraud, the company issued approximately 9 billion new shares of its stock that it did not register with the SEC. These new, unregistered shares diluted existing shares, causing their value to drop by as much as $7 million. At the same time, Lefkowitz received free-trading shares from Unico worth more than $28 million, which he sold to unsuspecting buyers on the open market.
Also according to the indictment against Lopez, he tried to obstruct an SEC probe into his misconduct by refusing to turn over emails, which he printed and concealed in two manila folders marked “Files Deleted” and another marked “Not Released to SEC Subpoena (Delete).” The indictment further alleged that Lopez redacted portions of an email and tried to delete it from his computer, and later lied to the SEC under oath during deposition testimony.
According to United States Attorney Duffy, the Deferred Prosecution Agreement was an appropriate vehicle in this case as it did not further penalize Unico’s stockholders for criminal behavior undertaken by Lefkowitz and a former company executive. She added, though, that this remedy was available only because of the company’s cooperation in this investigation. The United States Attorney also stressed that the designation of a corporate monitor was another integral component of this agreement as it guards against Unico being involved in future stock fraud.
DEFENDANT Case Number: 13CR0355-JAH Unico, Inc. SUMMARY OF CHARGESFalse Statement to a Government Agency, in violation of Title 18, United States Code, Section 1001(a)(2). Maximum penalties: 5 years in prison, 5years' supervised release, a $500,000 fine and a $400 special assessment.
INVESTIGATING AGENCYFederal Bureau of Investigation
The public is reminded that an indictment itself is not evidence that the defendants committed the crimes charged. The defendants are presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.
Ralston Man Sentenced to 2 years for Failure to Register as a Sex OffenderRead the Press Release
United States Attorney Deborah R. Gilg announced that James R. Nelson, 56, was sentenced in the United States District Court in Omaha for failure to register as a sex offender. The Honorable Lyle E. Strom, Senior District Court Judge, sentenced Nelson to 2 years in prison. After his release from prison Nelson will begin a 5 year term of supervised release.
Nelson was convicted in Illinois of sexual assault of a seven year old in 1995. He is required to register as a sex offender for life. He was last registered at an address in Iowa. Nelson moved to Ralston in June of 2012. He acquired a Nebraska Identification card. He failed to register as a sex offender in Nebraska. He was arrested on July 9, 2012, by the United States Marshal Service.
The case was prosecuted as a part of Project Safe Childhood. Project Safe Childhood is an initiative of the United States Department of Justice designed to protect children from individuals who would exploit them online or offline and includes individuals who travel in interstate commerce and fail to register as sex offenders as required by law. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov
Quality Roofing, Inc., Pleads Guilty to Submitting False Documents to GovernmentRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Quality Roofing, Inc., a Michigan-based corporation, pleaded guilty before U.S. District Judge Charles J. Siragusa to preparing and submitting false documents to the government. The charge carries a maximum penalty of a fine of $500,000.
Assistant U.S. Attorney John J. Field, who is handling the case, stated that the defendant was a subcontractor on a government roofing project at the Kenneth B. Keating Federal Building in 2007-2008. Quality Roofing was required to pay its employees the prevailing wage, as established by the Secretary of Labor, and to submit weekly certified payrolls confirming this fact. The defendant did not pay its employees the prevailing wage, but falsely claimed in its certified payrolls that it had done so.
As part of the plea, Quality Roofing has agreed to pay a fine of $75,000 to the United States, and restitution to its employees in the amount of $19,197.50, which represents the difference between what the employees should have been paid and what they were actually paid.
The plea is the culmination of an investigation on the part of Special Agents of the General Services Administration, under the direction of James E. Adams, and the Department of Labor, under the direction of Special Agent in Charge Robert L. Panella.
Sentencing is scheduled for date April 15, 2013, at 4:00 p.m. before Judge Siragusa.
President of Excavating Company Pleads Guilty to Tax ChargesRead the Press Release
RICHMOND, Va. – Jimmy Holland Boyd, 63, of Fredericksburg, Virginia pled guilty on January 29, 2013, to failing to pay employment taxes and failing to file personal income tax returns. As part of the plea, he admitted that he had not filed personal income tax returns since 1988 and owes the United States $350,000 in back taxes.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia; and Sheila A. Olander, Acting Special Agent in Charge of the Criminal Investigation Division of the Internal Revenue Service, made the announcement after the plea was accepted by United States Magistrate Judge M. Hannah Lauck. Boyd is facing a maximum sentence of 5 years in prison and $250,000 in fines on the employment tax charge and 1 year in prison and $100,000 on the personal tax charge when he is sentenced by United States District Judge James R. Spencer on May 3, 2013.
At all material times, Boyd was President of Spring City Company Excavating, Inc., a Virginia-based real estate developing and excavating business. He pled guilty to failing to pay over $5,776 in federal income and FICA taxes on $34,864.62 of wages paid to his employees for the first quarter of 2009, ending March 31, 2009, in violation of 26 U.S.C. Section 7202.
As part of the written statement of facts accompanying his plea, Boyd also admitted that from 2005 through 2009 he paid employees of Spring City Excavating Company approximately $248,504 in net wages that were subject to federal income and FICA taxes, but to failed to pay the $41,170.77 of federal income and FICA taxes due the United States on those wages. Boyd also failed to issue IRS forms W-2 or 1099 to those employees.
Boyd also pled guilty to failing to file his personal tax return for 2007, even though he had gross income of $567,428.69 that year, in violation of 26 U.S.C. Section 7203. In the written statement of facts, Boyd admitted that he had not filed tax returns since 1988 and also acknowledged that he owes the IRS approximately $350,000 in personal taxes.
This case was investigated by the Criminal Investigation Division of the Internal Revenue Service. Assistant United States Attorney David T. Maguire is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Portola Valley Man Pleads Guilty to Failure to Report Foreign Bank AccountsRead the Press Release
SAN JOSE, Calif. – Christopher B. Berg of Portola Valley, Calif., entered a plea of guilty yesterday to willful failure to file the required report of foreign bank account (FBAR) for an account he controlled at United Bank of Switzerland AG (UBS), United States Attorney Melinda Haag announced.
In pleading guilty Berg admitted that in 1999, he began working as a consultant in the furniture industry. In 2000, he met with a Swiss financial consultant and Vice President of Banking at UBS in San Francisco, Calif., regarding setting up a bank account at UBS in Switzerland to shelter a portion of his consulting income from taxation. Beginning in 2001 and continuing through 2005, funds representing $642,069 in compensation earned by Berg from consulting services were deposited by wire transfer to UBS accounts. Berg used the money in these accounts at UBS in Switzerland to purchase a vehicle, to obtain cash while in Europe, and to pay the balance on a Eurocard he used while traveling in Europe. Berg did not disclose the existence of his accounts at UBS in Switzerland to his Certified Public Accountant, and did not disclose the income earned by these accounts or the consulting income deposited to the accounts. The tax harm associated with Berg’s conduct is $270,757.
United States citizens and residents who have an interest in, or signature or other authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such account on Schedule B, Part III, of their individual income tax returns. Additionally, U.S. citizens and residents must file an FBAR with the United States Treasury disclosing any financial account in a foreign country with assets in excess of $10,000 in which they have a financial interest, or over which they have signature or other authority.
On Dec. 18, 2012, Berg of Portola Valley, Calif., was charged with one count of Willfully Violating Foreign Bank Account Reporting Requirements. Under the plea agreement, Berg pled guilty to that count.
Berg is scheduled to be sentenced on July 10, 2013, before United States District Court Judge Lucy H. Koh in San Jose. The maximum statutory penalty for a violation of 31 U.S.C. §§ 5314 and 5322(a) is five years in prison and a fine of $250,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Trial attorneys from the Department of Justice Tax Division are prosecuting the case. The prosecution is the result of an investigation by IRS - Criminal Investigation.
Philadelphia Traffic Court Judges Indicted for FraudRead the Press Release
PHILADELPHIA - An indictment and three separate informations, unsealed today, charge nine elected judges along with three other individuals in a fraud conspiracy that allegedly involved frequent and pervasive “ticket-fixing” at the Philadelphia Traffic Court. The defendants participated in a widespread culture of giving breaks on traffic citations to friends, family, the politically-connected, and business associates. The defendants include: • Michael J. Sullivan (sitting Judge, Traffic Court)
• Michael Lowry (sitting Judge, Traffic Court)
• Robert Mulgrew (former Judge, Traffic Court)
• Willie Singletary (former Judge, Traffic Court)
• Thomasine Tynes (former Judge, Traffic Court)
• Mark A. Bruno (Chester County Magisterial District)
• H. Warren Hogeland (Bucks County Senior Magisterial District Judge)
• Kenneth Miller (Delaware County Senior District Judge)
• Fortunato N. Perri, Sr. (Senior Judge, Traffic Court)
• William Hird (former Director of Records, Traffic Court)
• Henry P. Alfano (local businessman)
• Robert Moy (local businessman)The 77-count indictment was announced by United States Attorney Zane David Memeger and Acting Special Agent-in-Charge John Brosnan.
According to the indictment, Philadelphia ward leaders, local politicians and associates of the Democratic City Committee regularly contacted defendants seeking preferential treatment on specific tickets. Additionally, defendants were regularly contacted by family, friends and associates seeking a “break” on tickets. These defendants accepted these requests and either gave the preferential treatment directly or communicated the request to another judge to whom the case was assigned.
Tickets were “fixed” by either being dismissed, finding the ticket holder “not guilty,” or finding the ticket holder guilty of a lesser offense. In many cases, the ticket holder did not even appear in Traffic Court, yet their ticket was “fixed.” As a result, these ticketholders paid lesser or no fines and costs, and evaded the assessment of “points” on their driver’s record. This widespread “ticket-fixing” defrauded both the Commonwealth of Pennsylvania and the City of Philadelphia of funds, and allowed potentially unsafe drivers to remain on the roads.
The defendants allegedly used their personal assistants and courtroom staff to communicate requests to “fix tickets” to other judges. The indictment further alleges that the conspiracy also involved a cover-up which consisted of shredding paperwork, speaking in code, and trusting only certain individuals to carry out the fraud scheme.
Three judges - defendants Lowry, Mulgrew, and Tynes - are each charged with committing perjury before the federal grand jury. One judge - defendant Singletary - and defendant Hird are charged with lying to the FBI when they were approached and asked questions about ticket fixing at Traffic Court.
Defendant Henry P. Alfano regularly gave defendant Fortunato N. Perri, Sr. free auto repairs, free towing, free videos, and free seafood in exchange for “fixing” tickets. According to the indictment, Alfano would give Perri traffic citation numbers, the names of offenders, or the actual citations to arrange “fixing” the ticket. Perri conveyed the information to William Hird.
Hird, in turn, conveyed the request to the assigned judge. Court authorized intercepted telephone conversations reveal that Perri prioritized assisting Alfano and Alfano made sure to take care of Perri.. Perri told Alfano “when you call, I move, brother, believe me. I move everybody.” After multiple free repairs on his cars and family members’ cars, Perri allegedly told Alfano their relationship was “becoming like a one way street. I like a two way street.” To which Alfano responded “if I need something, you’re going to do it.”Defendant Hird, it is alleged, was extremely loyal to Perri given that Perri helped Hird move up the ladder to a high-level administrator at Traffic Court. Recorded conversations demonstrate that Hird acceded to Perri’s requests to “fix” certain tickets. Given Hird’s position at Traffic Court and access to the judges, Hird was allegedly able to facilitate requests for ticket fixing, not only for Perri, but also for various Philadelphia ward leaders.
Defendant Michael J. Sullivan, in addition to requests from ward leaders, also assisted friends and customers of his bar, the Fireside Tavern. According to the indictment, Sullivan directed associates who wanted their tickets “fixed” to leave them at his tavern where they were placed in a box behind the bar. Defendant Sullivan would assure his associates that the ticket would be “fixed.” In one recorded call, Sullivan told a ticket holder, “I know you’re broke” and “it don’t matter which judge would be hearing the case, because “you’re good,” meaning the “fix” was conveyed.
Defendant Willie Singletary and Thomasine Tynes allegedly “fixed” tickets on behalf of defendant Robert Moy, who owned “Number One Translations,” a business located in Philadelphia. Moy, it is alleged, would guarantee paying customers favorable results on their Traffic Court citations based on his relationship with both Singletary and Tynes. According to the indictment, Moy even advertised in a local newspaper that he “Tackles the traffic ticket, and guarantees no points or fewer points.” Ticket holders took their citations to defendant Moy, paid Moy hundreds of dollars in cash, were instructed not to appear in Traffic Court, and ultimately were found not guilty by either Tynes or Singletary.
In addition to the conspiracy charging a longstanding and widespread practice of fixing tickets, the indictment specifically lists 50 separate citations as being “fixed.” These tickets involved driving at unsafe speeds, driving an unregistered vehicle, texting while driving, operating an ATV on the highway, running a red light, making a prohibited u-turn, careless driving, not using a child safety restraint, and towing a vehicle without a towing agreement, among others. Yet, these ticket holders unjustly incurred no penalties for their vehicle code violations.
“Our judicial system requires that the finder of fact determine guilt or innocence impartially,” said Memeger. “Ignoring this basic rule of justice, the judges in this case allegedly routinely "fixed" traffic tickets by giving preferential treatment to people with whom they were politically and socially connected. In addition to depriving the City of Philadelphia and the Commonwealth of Pennsylvania of funds rightfully owed by traffic violators, their allegedly corrupt conduct also undermined the confidence that law abiding citizens have in the Philadelphia Court System. Those who seek to game the system by refusing to follow the rules need to be held accountable by the rule of law they swore to uphold.”“The citizens of Philadelphia expect and deserve public officials who perform their duties free of deceit, favoritism, bias, self-enrichment, concealment and conflict of interest,” said Brosnan. “Everyone is entitled to the same treatment in Traffic Court, regardless of their personal relationships, regardless of political considerations, and regardless of the personal preferences of court officials.”
The moneys that would have been received from adjudicated citations would have been equally divided between the City of Philadelphia and the Commonwealth of Pennsylvania and used to fund, for example, the City of Philadelphia’s general fund; the Philadelphia Parking Authority; the First Judicial District’s procurement department; the funds lost to the Commonwealth of Pennsylvania would have paid for Emergency Medical Services training; MCARE, which helps compensate people injured by medical malpractice; and the Access to Justice Fund, which provides money for legal aid for low income people and victims of domestic violence.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Denise Wolf and Anthony Wzorek.
Indictment.pdf | Hogeland Information.pdf | Perri Information.pdf | Miller Information.pdf | Charges.pdf |Defendants.pdf
UNITED STATES ATTORNEY'S OFFICE Contact: EASTERN DISTRICT, PENNSYLVANIA PATTY HARTMAN
Suite 1250, 615 Chestnut Street Media Contact
Philadelphia, PA 19106 215-861-8525
COPIES OF NEWS MEMOS AND RELATED DOCUMENTS CAN ALSO BE FOUND AT http://www.usdoj.gov/usao/paeUNITED STATES ATTORNEY'S OFFICE, EASTERN DISTRICTof PENNSYLVANIA
Suite 1250, 615 Chestnut Street, Philadelphia, PA 19106
PATTY HARTMAN, Media Contact, 215-861-8525Peregrine Financial Group CEO Sentenced to 50 Years for Fraud, Embezzlement, and Lying to Regulators [Court’s Sentence Is the Maximum Allowed by Law]Read the Press Release
Russell R. Wasendorf, Sr., age 64, from Cedar Falls, Iowa, who stole more than $215,000,000 in customer funds from his commodity futures business, was sentenced today to 50 years in federal prison. Wasendorf received the prison term after a September 17, 2012 guilty plea to one count each of:
● mail fraud, ● embezzlement of customer funds by a person registered under the Commodity Exchange Act, ● making false statements to the Commodity Futures Trading Commission, and
● making false statements to a futures association registered under the Commodity Exchange Act.Wasendorf was the owner and former Chief Executive Officer of the now-bankrupt Peregrine Financial Group, Inc. (PFG), a futures commission merchant headquartered in Cedar Falls, Iowa.
In a plea agreement, Wasendorf admitted that, from about the early 1990s through about July of 2012, he stole millions of dollars from PFG’s customers. Wasendorf admitted he stole the funds, at least in part, by withdrawing money secretly from a customer segregated bank account, and then by omitting the withdrawals from and inflating the balances on forged bank statements purportedly issued by the bank. Wasendorf admitted that the forged bank statements overstated the amount of customer funds in the account by more than $200 million. Wasendorf admitted he prevented regulators from discovering his crimes by submitting false periodic reports, and forged bank account verification forms to the National Futures Association and the Commodity Futures Trading Commission.
Also in the plea agreement, Wasendorf admitted establishing a post office box to intercept paperwork sent by regulators and intended for U.S. Bank. Wasendorf included the post office box number on forged bank statements so that auditors and regulators would think the box belonged to the bank.
According to information disclosed at the sentencing hearing, Wasendorf stole more than $215,000,000 from more than 13,000 victims over the course of nearly 20 years. A bankruptcy trustee and a court-appointed receiver have been gathering known assets for distribution to creditors, including PFG’s commodities futures account holders.
Wasendorf was sentenced in Cedar Rapids by United States District Court Chief Judge Linda R. Reade. Wasendorf was sentenced to 50 years’ imprisonment – the maximum sentenced allowed by law for his offenses of conviction. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system. The Court imposed a judgment of forfeiture in the amount of $100 million and it ordered Wasendorf to make $215,530,041.39 in restitution to more than 13,000 victims. As part of the plea agreement, Wasendorf agreed that any proceeds from any publicity about his crimes would be assigned to the United States and applied toward his restitution.
“By lying to investors and regulators, Wasendorf defrauded thousands of innocent investors out of a staggering $215,000,000,” said Acting United States Attorney Sean R. Berry. “The lengthy prison sentence imposed today is just punishment for a con man who built a business on smoke and mirrors.”
Thomas R. Metz, Special Agent In-Charge of the Omaha Division of the Federal Bureau of Investigation, said: “Today’s sentence demonstrates this agency’s commitment to holding accountable those who prey on unwary investors and lie to those regulatory agencies responsible for protecting the integrity of U.S. financial markets.”
Wasendorf is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorneys Peter Deegan and Matthew Cole and was investigated by the Federal Bureau of Investigation with the assistance of the Blackhawk County Sheriff’s Office and the United States Postal Inspection Service.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 12-CR-2021 LRR.
Owner of Japanese Restaurant Receives 33-Month Prison Sentence for Tax CrimesRead the Press Release
SAN FRANCISCO – Michael Chen, the owner of Fune Ya Japanese Restaurant in San Francisco was sentenced yesterday to 33 months in prison and ordered to pay restitution in the amount of $459,105 for filing false federal corporate income tax returns with the Internal Revenue Service (IRS), and mail fraud for filing false sales tax returns with the California Board of Equalization, United States Attorney Melinda Haag and Internal Revenue Service Criminal Investigation (IRS-CI) Special Agent in Charge Jose M. Martinez announced.
During a five day jury trial in March, 2012, a federal jury found that Michael Chen filed a false 2004 U.S. income tax return for an S Corporation (Form 1120S) for his restaurant, Fune Ya Japanese Restaurant; failed to file corporate income tax returns for Fune Ya Japanese Restaurant for 2005 and 2006; filed nine false employer’s quarterly federal tax returns (Forms 941) with the IRS, and used the U.S. mail to file nine false quarterly sales and use tax returns with the California Board of Equalization. Evidence at trial showed that Chen maintained detailed records of Fune Ya’s daily receipts in twenty-six boxes marked “Seasoned Octopus.” The boxes were stored in a crawl space beneath the restaurant floor. The cash sales shown on Fune Ya’s receipts were not reported to the IRS. The evidence also showed that Chen maintained an encrypted Excel spreadsheet documenting $1,910,803 in sales, while he reported $450,165 in sales to the California Board of Equalization, and $65,738 in sales to the IRS. Chen also paid Fune Ya employees cash wages totaling $548,919 for the 2004 through 2006 tax years. Employees received cash wages in white envelopes each payday. Chen failed to include these cash wages on the quarterly payroll tax returns (Forms 941) filed with the IRS.
Chen was convicted by a jury on March 27, 2012. The sentence was handed down by U.S. District Court Judge Maxine Chesney following a jury trial on 10 counts of filing false tax returns in violation of 26 U.S.C. Section 7206(1); two counts of failure to file tax returns in violation of 26 U.S.C. Section 7203; and nine counts of mail fraud in violation of 18 U.S.C. Section 1341. Judge Chesney also sentence the defendant to a three-year term of supervised release. The defendant is scheduled to self-surrender and begin serving his sentence on March 27, 2013.
Cynthia Stier and Damali Taylor are the Assistant U.S. Attorneys who prosecuted the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.
Oregon Resident Convicted in Plot to Bomb Christmas Tree Lighting Ceremony in PortlandRead the Press Release
After a 14-day trial, Mohamed Osman Mohamud, 21, a naturalized U.S. citizen from Somalia and resident of Corvallis, Ore., was convicted today by a federal jury in the District of Oregon of attempting to use a weapon of mass destruction (explosives) in connection with a plot to detonate a vehicle bomb at an annual Christmas tree lighting ceremony in Portland.
At sentencing, Mohamud faces a maximum statutory sentence of life in prison. Mohamud was arrested on Nov. 26, 2010, after he attempted to detonate what he believed to be an explosives-laden van that was parked near the tree lighting ceremony in Portland. The arrest was the culmination of a long-term undercover operation, during which Mohamud was monitored closely for months as his bomb plot developed. The device was in fact inert; and the public was never in danger from the device.
“When an individual concocts a plan to commit mass violence – and is determined to follow through – law enforcement has an obligation to take action to protect the public. Today’s verdict shows that they will be held to account,” said Lisa Monaco, Assistant Attorney General for National Security. “I applaud all those who worked so diligently to thwart this plot and ensure no one was harmed.”
“This trial provided a rare glimpse into the techniques Al Qaeda employs to radicalize home-grown extremists. With the verdict today, the jury has held this defendant accountable,” said Amanda Marshall, U.S. Attorney for the District of Oregon. “I thank the dedicated professionals in the law enforcement and intelligence communities who were responsible for this successful outcome. I look forward to our continued work with Muslim Communities in Oregon who are committed to ensuring that all young people are safe from extremists who seek to radicalize others to engage in violence.”
“The verdict returned in the Mohamed Mohamud case highlights the difficult, but important, work that FBI employees do every day. Whether an employee is an undercover agent or analyst or technician – each has a role to play in keeping our community safe while at the same time respecting the freedoms that make this country strong. Indeed, in this country everyone has a right to live, work and worship freely and without fear. FBI employees – in Oregon and around the world – find strength in preserving and protecting these core values,” said Gregory Fowler, Special Agent in Charge of the FBI Portland Division.
According to court documents and evidence presented by the government at trial, in February 2009, Mohamud began communicating via e-mail with Samir Khan, a now-deceased al-Qaeda terrorist who published Jihad Recollections, an online magazine that advocated violent jihad, and who also published Inspire, the official magazine of al-Qaeda in the Arabian Peninsula. Between February and August 2009, Mohamed exchanged approximately 150 emails with Khan. Mohamud wrote several articles for Jihad Recollections that were published under assumed names.
In August 2009, according to evidence presented at trial, Mohamud was in email contact with Amro Al-Ali, a Saudi national who was in Yemen at the time and is today in custody in Saudi Arabia for terrorism offenses. Al-Ali sent Mohamud detailed emails designed to facilitate Mohamud’s travel to Yemen to train for violent jihad. In December 2009, while Al-Ali was in the northwest frontier province of Pakistan, Mohamud and Al-Ali discussed the possibility of Mohamud traveling to Pakistan to join Al-Ali in terrorist activities. Mohamud responded to Al-Ali in an email: “yes, that would be wonderful, just tell me what I need to do.” Al-Ali referred Mohamud to a second associate overseas and provided Mohamud with a name and email address to facilitate the process.
In the following months, Mohamud made several unsuccessful attempts to contact Al-Ali’s associate. Ultimately, an FBI undercover operative contacted Mohamud via email under the guise of being an associate of Al-Ali’s. Mohamud and the FBI undercover operative agreed to meet in Portland in July 2010. At the meeting, Mohamud told the FBI undercover operative he had written articles that were published in Jihad Recollections. Mohamud also said that he wanted to become “operational.” Asked what he meant by “operational,” Mohamud said he wanted to put an explosion together, but needed help.
According to evidence presented at trial, at a meeting in August 2010, Mohamud told undercover FBI operatives he had been thinking of committing violent jihad since the age of 15. Mohamud then told the undercover FBI operatives that he had identified a potential target for a bomb: the annual Christmas tree lighting ceremony in Portland’s Pioneer Courthouse Square on Nov. 26, 2010. The undercover FBI operatives cautioned Mohamud several times about the seriousness of this plan, noting there would be many people at the event, including children, and emphasized that Mohamud could abandon his attack plans at any time with no shame. Mohamud indicated the deaths would be justified and that he would not mind carrying out a suicide attack on the crowd.
According to evidence presented at trial, in the ensuing months Mohamud continued to express his interest in carrying out the attack and worked on logistics. On Nov. 4, 2010, Mohamud and the undercover FBI operatives traveled to a remote location in Lincoln County, Ore., where they detonated a bomb concealed in a backpack as a trial run for the upcoming attack. During the drive back to Corvallis, Mohamud was asked if he was capable of looking at all the bodies of those who would be killed during the explosion. In response, Mohamud noted, “I want whoever is attending that event to be, to leave either dead or injured.” Mohamud later recorded a video of himself, with the assistance of the undercover FBI operatives, in which he read a statement that offered his rationale for his bomb attack.
On Nov. 18, 2010, undercover FBI operatives picked up Mohamud to travel to Portland to finalize the details of the attack. On Nov. 26, 2010, just hours before the planned attack, Mohamud examined the 1,800 pound bomb in the van and remarked that it was “beautiful.” Later that day, Mohamud was arrested after he attempted to remotely detonate the inert vehicle bomb parked near the Christmas tree lighting ceremony
This case was investigated by the FBI, with assistance from the Oregon State Police, the Corvallis Police Department, the Lincoln County Sheriff’s Office and the Portland Police Bureau. The prosecution is being handled by Assistant U.S. Attorneys Ethan D. Knight and Pamala Holsinger from the U.S. Attorney’s Office for the District of Oregon. Trial Attorney Jolie F. Zimmerman, from the Counterterrorism Section of the Justice Department’s National Security Division, is assisting.
Oregon Resident Convicted in Plot to Bomb Christmas Tree Lighting Ceremony in PortlandRead the Press Release
PORTLAND, Ore. - After a 14-day trial, Mohamed Osman Mohamud, 21, a naturalized U.S. citizen from Somalia and resident of Corvallis, Ore., was convicted today by a federal jury in the District of Oregon of attempting to use a weapon of mass destruction (explosives) in connection with a plot to detonate a vehicle bomb at an annual Christmas tree lighting ceremony in Portland, Ore.
At sentencing, Mohamud faces a maximum statutory sentence of life in prison. Mohamud was arrested on Nov. 26, 2010, after he attempted to detonate what he believed to be an explosives-laden van that was parked near the tree lighting ceremony in Portland. The arrest was the culmination of a long-term undercover operation, during which Mohamud was monitored closely for months as his bomb plot developed. The device was in fact inert; and the public was never in danger from the device.
"This trial provided a rare glimpse into the techniques Al Qaeda employs to radicalize home-grown extremists. With the verdict today, the jury has held this defendant accountable," Amanda Marshall, U.S. Attorney for the District of Oregon. "I thank the dedicated professionals in the law enforcement and intelligence communities who were responsible for this successful outcome. I look forward to our continued work with Muslim Communities in Oregon who are committed to ensuring that all young people are safe from extremists who seek to radicalize others to engage in violence."
"When an individual concocts a plan to commit mass violence - and is determined to follow through - law enforcement has an obligation to take action to protect the public. Today's verdict shows that they will be held to account," said Lisa Monaco, Assistant Attorney General for National Security. "I applaud all those who worked so diligently to thwart this plot and ensure no one was harmed."
"The verdict returned in the Mohamed Mohamud case highlights the difficult, but important, work that FBI employees do every day. Whether an employee is an undercover agent or analyst or technician - each has a role to play in keeping our community safe while at the same time respecting the freedoms that make this country strong. Indeed, in this country everyone has a right to live, work and worship freely and without fear. FBI employees - in Oregon and around the world - find strength in preserving and protecting these core values," said Gregory Fowler, Special Agent in Charge of the FBI Portland Division.
According to court documents and evidence presented by the government at trial, in February 2009, Mohamud began communicating via e-mail with Samir Khan, a now-deceased al-Qaeda terrorist who published Jihad Recollections, an online magazine that advocated violent jihad, and who also published Inspire, the official magazine of al-Qaeda in the Arabian Peninsula. Between February and August 2009, Mohamed exchanged approximately 150 emails with Khan. Mohamud wrote several articles for Jihad Recollections that were published under assumed names.
In August 2009, according to evidence presented at trial, Mohamud was in email contact with Amro Al-Ali, a Saudi national who was in Yemen at the time and is today in custody in Saudi Arabia for terrorism offenses. Al-Ali sent Mohamud detailed e-mails designed to facilitate Mohamud's travel to Yemen to train for violent jihad. In December 2009, while Al-Ali was in the northwest frontier province of Pakistan, Mohamud and Al-Ali discussed the possibility of Mohamud traveling to Pakistan to join Al-Ali in terrorist activities. Mohamud responded to Al-Ali in an e-mail: "yes, that would be wonderful, just tell me what I need to do." Al-Ali referred Mohamud to a second associate overseas and provided Mohamud with a name and email address to facilitate the process.
In the following months, Mohamud made several unsuccessful attempts to contact Al-Ali's associate. Ultimately, an FBI undercover operative contacted Mohamud via email under the guise of being an associate of Al-Ali's. Mohamud and the FBI undercover operative agreed to meet in Portland in July 2010. At the meeting, Mohamud told the FBI undercover operative he had written articles that were published in Jihad Recollections. Mohamud also said that he wanted to become "operational." Asked what he meant by "operational," Mohamud said he wanted to put an explosion together, but needed help.
According to evidence presented at trial, at a meeting in August 2010, Mohamud told undercover FBI operatives he had been thinking of committing violent jihad since the age of 15. Mohamud then told the undercover FBI operatives that he had identified a potential target for a bomb: the annual Christmas tree lighting ceremony in Portland's Pioneer Courthouse Square on Nov. 26, 2010. The undercover FBI operatives cautioned Mohamud several times about the seriousness of this plan, noting there would be many people at the event, including children, and emphasized that Mohamud could abandon his attack plans at any time with no shame. Mohamud indicated the deaths would be justified and that he would not mind carrying out a suicide attack on the crowd.
According to evidence presented at trial, in the ensuing months Mohamud continued to express his interest in carrying out the attack and worked on logistics. On Nov. 4, 2010, Mohamud and the undercover FBI operatives traveled to a remote location in Lincoln County, Ore., where they detonated a bomb concealed in a backpack as a trial run for the upcoming attack. During the drive back to Corvallis, Mohamud was asked if was capable looking at all the bodies of those who would be killed during the explosion. In response, Mohamud noted, "I want whoever is attending that event to be, to leave either dead or injured." Mohamud later recorded a video of himself, with the assistance of the undercover FBI operatives, in which he read a statement that offered his rationale for his bomb attack.
On Nov. 18, 2010, undercover FBI operatives picked up Mohamud to travel to Portland to finalize the details of the attack. On Nov. 26, 2010, just hours before the planned attack, Mohamud examined the 1,800 pound bomb in the van and remarked that it was "beautiful." Later that day, Mohamud was arrested after he attempted to remotely detonate the inert vehicle bomb parked near the Christmas tree lighting ceremony
This case was investigated by the FBI, with assistance from the Oregon State Police, the Corvallis Police Department, the Lincoln County Sheriff's Office and the Portland Police Bureau. The prosecution is being handled by Assistant U.S. Attorneys Ethan D. Knight and Pamala Holsinger from the U.S. Attorney's Office for the District of Oregon. Trial Attorney Jolie F. Zimmerman, from the Counterterrorism Section of the Justice Department's National Security Division, is assisting.
Oregon Man Indicted for Tax Fraud and Identity TheftRead the Press Release
Ricky Lee Greenwood, of Portland, Ore., was indicted late last night on nine counts of wire fraud, nine counts of filing false claims for tax refunds, and eight counts of aggravated identity theft, the Justice Department and the Internal Revenue Service (IRS) announced. Greenwood made his initial appearance in court Wednesday in Portland.
According to the 26-count indictment, Greenwood electronically filed at least 66 false tax returns with fictitious wage and false dependent information, requesting at least $300,000 in fraudulent refunds. Greenwood is alleged to have obtained the names and Social Security numbers of unemployed individuals in order to file fraudulent tax returns in their names. According to the indictment, Greenwood also obtained the Social Security numbers of children and claimed them on the tax returns of unrelated individuals to maximize refundable credits – such as the Earned Income Tax Credit and the Additional Child Tax Credit – and further inflate the fraudulent refunds. In addition, according to the indictment, Greenwood had the fraudulent refunds delivered to him or deposited into accounts that he controlled.
An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Greenwood faces a maximum sentence of 5 years in prison for each false claims count, up to 20 years in prison for each wire fraud count, and a mandatory 2-year sentence on the aggravated identity theft counts. If convicted, he could be subject to fines, mandatory restitution and a money judgment.
This case was investigated by the IRS Criminal Investigation Stolen Identity Refund Fraud Task Force. Trial Attorneys Leslie A. Goemaat and Todd P. Kostyshak of the Justice Department’s Tax Division and Assistant U.S. Attorney Claire Fay are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax .
North Hills Man Pleads Guilty to Possession of Child Pornography VideosRead the Press Release
PITTSBURGH, Pa. - A resident of Allegheny County pleaded guilty in federal court to a charge of possession of material depicting the sexual exploitation of a minor, United States Attorney David J. Hickton announced today.
Daniel L. King, 24, of Glenshaw, Pa., pleaded guilty to one count before United States District Judge Cathy Bissoon.
In connection with the guilty plea, the court was advised that on June 21, 2012, King possessed visual depictions, namely, videos in computer graphics files, the production of which involved the use of minors engaging in sexually explicit conduct.
Judge Bissoon scheduled sentencing for June 4, 2013, at 10:00 a.m. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any, of the defendant.
Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.
The Immigration and Customs Enforcement, Homeland Security Investigations and the Pennsylvania State Police conducted the investigation that led to the prosecution of King.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Nicholas County Man Sentenced to 5 Years in Federal Prison for Selling Prescription PainkillersRead the Press Release
Bryant admitted to selling powerful painkillers from his Nicholas Co. auto care business
CHARLESTON, W.Va. – U.S. Attorney Booth Goodwin announced today that a Nicholas County man was sentenced to five years in federal prison for selling morphine. Ralph Donald Bryant II, 41, of Summersville, Nicholas County, W.Va., previously pleaded guilty in September 2012 to distribution of morphine. Bryant admitted that on August 4, 2010, he sold one morphine tablet to an individual cooperating with law enforcement authorities in exchange for $120. Bryant further admitted that the illegal pill transaction took place at his auto care business located in Summersville. The defendant also admitted that from the fall of 2007 until April 11, 2011, he distributed multiple controlled substances including oxymorphone and oxycodone in and around the Nicholas County area.
The Central West Virginia Drug Task Force conducted the investigation. Assistant United States Attorney John Frail handled the prosecution. The sentence was imposed by United States District Judge Thomas E. Johnston.
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.
Newington Resident Charged with Orchestrating Extensive Mortgage Fraud SchemeRead the Press Release
January 31, 2013David B. Fein, United States Attorney for the District of Connecticut, announced that FILIPPOS (“FILIP”) MILIOS, 54, of Newington, was arrested today on a federal criminal complaint charging him with bank fraud stemming from his alleged involvement in an extensive mortgage fraud scheme in the greater Hartford area.
According to statements made in court, it is alleged that MILIOS led and organized a multi-year mortgage fraud scheme to purchase and sell houses using straw borrowers and false or fictitious loan applications, employment verifications, bank statements, and pay stubs. MILIOS purchased numerous homes and then sold them at a significantly higher sales price to straw borrowers that he and his co-conspirators recruited. In addition, it is alleged that MILIOS used his own funds to make the down payments on behalf of the borrowers, and that he made payments outside of closing to the straw borrowers and his co-conspirators.
This alleged scheme involved more than 40 fraudulent mortgages exceeding $10 million and losses exceeding $5 million.
Following his arrest this morning, MILIOS appeared before United States Magistrate Judge Donna F. Martinez in Hartford and was released on a $100,000 bond.
U.S. Attorney Fein noted that the investigation into these alleged schemes is ongoing and asked individuals who have information that may helpful to the investigation to contact the U.S. Department of Housing and Urban Development – Office of Inspector General at (860) 240-4800.
U.S. Attorney Fein stressed that a complaint is only a charge and is not evidence of guilt. The defendant is entitled to have this matter presented to a grand jury and, in the event an indictment is returned, he is entitled to a trial at which it will be the Government’s burden to prove guilt beyond a reasonable doubt.
This case is being investigated by the U.S. Department of Housing and Urban Development – Office of Inspector General, the Internal Revenue Service, and the United States Postal Inspection Service and the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney David T. Huang and Paul H. McConnell.Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants.
To report financial fraud crimes, and to learn more about the President’s Financial Fraud Enforcement Task Force, please visit www.stopfraud.gov.
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(203) 821-3722 [email protected]New York Doctor Admits Oxycodone Distribution and ConspiracyRead the Press Release
TRENTON, N.J. – A physician who wrote illegal prescriptions for oxycodone today admitted his participation in a conspiracy to illegally distribute the medication, and admitted that he distributed it on numerous occasions, U.S. Attorney Paul J. Fishman announced.
Dr. Hassan Lahham, 54, of New York, was charged by Indictment with one count of conspiracy to distribute oxycodone and eleven counts of distribution of oxycodone. He pleaded guilty before U.S. District Judge Freda L. Wolfson in Trenton federal court to Count One of the Indictment, which charges that he conspired to distribute oxycodone.
According to documents filed in this case and statements made in court:
Since January 2009, Lahham issued prescriptions to co-conspirators for drugs containing oxycodone, outside the usual course of medical practice and not for any legitimate medical purpose. The prescriptions were filled at various New Jersey pharmacies located in and around Monmouth, Ocean, and Atlantic counties and redistributed by others. Lahham wrote the prescriptions in exchange for cash payments, and knew the pills were to be redistributed.
Oxycodone, the active ingredient in brand name pills such as Oxycontin, Roxicodone and Percocet, is a Schedule II controlled substance – meaning that it has a high potential for abuse, a currently accepted medical use with severe restrictions, and abuse of the drug may lead to severe psychological or physical dependence.
The charge to which Lahham pleaded guilty is punishable by a maximum potential penalty of 20 years in prison and a $1 million fine. Sentencing is scheduled for May 10, 2013.U.S. Attorney Fishman credited the Drug Enforcement Administration’s New Jersey Division under the direction of Acting Special Agent in Charge Robert G. Koval, along with the Special Agents, Diversion Investigators, Task Force Officers, Detectives and Intelligence Analysts of the Atlantic City Resident Office; Camden Resident Office Diversion Group; Seaside Heights Police Department; Barnegat Police Department; Ship Bottom Police Department; and the N.J. DEA Tactical Diversion Squad, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys R. Joseph Gribko and Fabiana Pierre-Louis of the U.S. Attorney’s Office in Trenton.
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Defense counsel: Frank P. Arleo Esq., West Orange, N.J.
Lahham Indictment
Navajo Man from Arizona Sentenced for Violating Migratory Bird Treaty ActRead the Press Release
ALBQUERQUE –Daniel Chee Walley, 47, a member of the Navajo Nation from Chambers, Ariz., was sentenced this afternoon for violating the Migratory Bird Treaty Act, announced U.S. Attorney Kenneth J. Gonzales and Nicholas E. Chavez, Special Agent in Charge of the Southwest Region, U.S. Fish and Wildlife Service Office of Law Enforcement.
Walley was arrested on Sept. 14, 2012, based on an indictment charging him with selling and bartering parts of a Swainson’s hawk tail on Jan. 31, 2009, in McKinley County, N.M., without obtaining permission from the Secretary of the U.S. Department of the Interior, in violation of the Migratory Bird Treaty Act. On Oct. 22, 2012, Walley pled guilty to the During this afternoon’s proceedings, Walley was sentenced to two months of home confinement followed by a year of probation. Walley also fined $150 to be paid to the North American Wetlands Conservation Fund.
Swainson’s hawks and other migratory birds are protected under federal wildlife laws, including the Migratory Bird Treaty Act. These laws prohibit the possession, use, and sale of the feathers or other parts of federally protected birds, as well as the unauthorized killing of these birds, to help ensure that bird populations remain healthy and sustainable.
“We want people to understand that over 1000 birds are safeguarded under the Migratory Bird Treaty Act, and the Service is committed to ensuring their protection,” said Nicholas E. Chavez, the US Fish and Wildlife Services Southwest Region Special Agent in Charge.
This case was prosecuted by Special Assistant U.S. Attorney Adam S. Rowley, and was investigated by the U.S. Fish and Wildlife Service and the Navajo Department of Fish and Wildlife Conservation.
The mission of the U.S. Fish and Wildlife Service is working with others to conserve, protect, and enhance fish, wildlife, plants, and their habitats for the continuing benefit of the American people. It is both a leader and trusted partner in fish and wildlife conservation, known for its scientific excellence, stewardship of lands and natural resources, dedicated professionals, and commitment to public service. For more information on its work and the people who make it happen, visit www.fws.gov. Connect with its Facebook page at www.facebook.com/usfws, follow its tweets at www.twitter.com/usfwshq, watch its YouTube Channel at http://www.youtube.com/usfws and download photos from its Flickr page at http://www.flickr.com/photos/usfwshq.