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15 January 2013
New York Woman Indicted for Lying to Federal Agents Investigating Newtown Fundraising FraudRead the Press Release
January 15, 2013David B. Fein, United States Attorney for the District of Connecticut, announced that a federal grand jury sitting in Bridgeport returned an indictment today charging NOUEL ALBA, 37, of Bronx, N.Y., with making false statements to FBI agents in connection with their investigation into a fraudulent fundraising scheme related to the Newtown school shooting tragedy.
The indictment alleges that ALBA used her Facebook account, telephone calls and text messages to falsely claim to be an aunt of a shooting victim and supply fictitious details about the aftermath of the tragedy in order to solicit donations on the pretext that she was collecting on behalf of the family for the child’s “funeral fund.” At ALBA’s instruction, donor-victims sent money to a PayPal account controlled and accessed by ALBA. The indictment further alleges that, when contacted by FBI Special Agents investigating fundraising and charity scams related to the Newtown school shooting, ALBA falsely stated that she did not post information related to Newtown on her Facebook account, have contact with anyone about such postings, or recently access her PayPal account.
The indictment charges ALBA with one count of making false statements to federal agents, an offense that carries a maximum term of imprisonment of five years and a fine of up to $250,000.
ALBA was arrested on a criminal complaint on December 27, 2012, and she has been released on a $50,000 bond since the date of her arrest.
“Investigators continue to monitor the Internet to uncover other fundraising scams arising from this tragedy, and any individuals who attempt to profit through these schemes will be prosecuted,” stated U.S. Attorney Fein.
U.S. Attorney Fein noted that potential federal charges associated with fraudulent fundraising and charity schemes include wire fraud (18 USC 1343, 20-year maximum prison term), access device fraud (18 USC 1029, 10-year maximum prison term) and interstate transportation of stolen property (18 USC 2314, 10-year maximum prison term).
Individuals with knowledge of Newtown-related fundraising schemes are encouraged to contact the FBI in Connecticut at 203-777-6311.
U.S. Attorney Fein stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This case is being investigated by the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Jonathan Francis.
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(203) 821-3722 [email protected]Nacogdoches Man Sentenced for Drug Trafficking in East TexasRead the Press Release
Department of Justice
Office of Public AffairsBEAUMONT, Texas – A Nacogdoches man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced U.S. Attorney John M. Bales today. The sentencing hearing was held before U.S. District Judge Ron Clark.
Tremaine Smith, 27, of Nacogdoches, Texas, pleaded guilty on Sep. 5, 2012, to possession with intent to distribute crack cocaine and was sentenced to 63 months in federal prison today.
According to information presented in court, from 2008 to June 20, 2012, Donald Dixon, a.k.a. “Black”, Cedrick Fowler, a.k.a. “C” and “C-Murder”, Kerry Wayne Griffin, a.k.a. “Big Boy”, Omar Paunetto, Jose Angel Bustillos, Michael John Pereira, Rodney Stevenson, a.k.a. “Arod”, Darius Thorn, a.k.a. “Bs” and “Beez”, Tremaine Smith and Anthony Fowler conspired to traffic cocaine and crack cocaine throughout East Texas.
Smith's role in the conspiracy was to acquire powder cocaine from C. Fowler and then convert it into a "crack" cocaine base. Smith would then redistribute the crack cocaine to others in East Texas.
On June 20, 2012, a federal grand jury returned a 10-count indictment charging 10 defendants, including Smith, with drug trafficking violations.
This case is the result of an ongoing Organized Crime Drug Enforcement Task Force (OCDETF) joint investigation. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
This case was investigated by the Drug Enforcement Administration, the Nacogdoches Police Department, and the Nacogdoches County Sheriff’s Office and prosecuted by Assistant U.S. Attorney Baylor Wortham.
Mortgage Fraud Co-Schemers Sentenced in Case that Crippled Pierce Commercial BankRead the Press Release
Three Pierce County women who played important roles in a mortgage fraud scheme that crippled now defunct Pierce Commercial Bank were sentenced yesterday in U.S. District Court in Tacoma, announced U.S. Attorney Jenny A. Durkan. All three of the women worked for years with scheme leader Shawn Portmann, whose fraudulent loans resulted in losses of more than $10 million. Portmann will be sentenced later this month. U.S. District Judge Benjamin H. Settle will determine restitution later this year.
Loan Underwriter JEANETTE R. SALSI, 55, of Bonney Lake, Washington was sentenced to seven months in prison, four months of home confinement and three years of supervised release for conspiracy. In 2004, SALSI followed Portmann from a different mortgage lender to PC Bank Home Loans (a subsidiary of Pierce Commercial Bank.) Portmann paid SALSI 60 percent more than she made at her prior employer and she became the primary underwriter of loans originated by Portmann. SALSI approved fraudulently generated loan applications despite the fact that they were filled with fraudulent documents. SALSI knew the files contained false statements and phony documents regarding the applicant’s employment, debts, current residence and plans to reside in the home. SALSI’s sign-off meant the loans were approved and sold to other financial institutions and the FHA. After Portmann was fired at PC Bank Home Loans, SALSI followed him to two other mortgage companies.
Personal Assistant ALICE LORRAINE BARNEY, 54, of Graham, Washington was sentenced to two months in prison, four months of electronic home confinement, 100 hours of community service and three years of supervised release. BARNEY was Portmann’s long-time assistant who created and inserted some of the false documents into loan files. BARNEY participated in submitting at least 60 fraudulent loan files. After Portmann was fired from PC Home Loans, BARNEY followed him to his three next employers.
Pierce Commercial Vice President and Residential Lending Manager SONJA LIGHTFOOT, 53, of Tacoma, Washington was sentenced to one month in prison, four months of home confinement, 60 hours of community service and three years of supervised release for her role in the conspiracy. LIGHTFOOT joined the bank in 2002, before Portmann began his scheme. Between 2004 and 2009 it was LIGHTFOOT’s job to lock the loans and sell them on the secondary market to other larger banks. LIGHTFOOT knew that some of the loans contained false statements from borrowers but sold them anyway. When the fraud was discovered the loans reverted back to Pierce Commercial Bank. The risk that additional loans would revert back to the bank ultimately forced the closure of the bank.
“Mortgage fraud can turn the American Dream of homeownership into a nightmare for our communities. Law enforcement will not sit idly by when greed causes professionals to abandon their integrity and become fraudsters,” said Kenneth J. Hines, Special Agent in Charge of IRS Criminal Investigation in the Pacific Northwest.
From 2004 to 2008, Shawn Portmann closed almost $1 billion in loans and he earned over $1.7 million per year. A review of a sample of conventional and FHA loans revealed that Portmann and his staff closed over 300 loans with false and fraudulent information. More than half of these loans have defaulted or otherwise caused loss to Pierce Commercial Bank, secondary investors, and/or the FHA, resulting in an estimated loss of $10 million.
Shawn Portmann is scheduled for sentencing January 28, 2013. At that time Judge Benjamin H. Settle will set a restitution amount, a share of which will be owed by all the defendants in the conspiracy.
The case was investigated by the FBI, the HUD Office of Inspector General (HUD-OIG), Internal Revenue Service Office of Criminal Investigation (IRS-CI) and the United States Postal Inspection Service. The case is being prosecuted by Assistant United States Attorneys Brian Werner and Arlen Storm.
Monongalia County Resident Sentenced on Drug and Firearms ChargesRead the Press Release
1125 Chapline Street, Federal Building, Suite 3000 ● Wheeling, WV 26003
(304) 234-0100 ● Contact: Chris Zumpetta-Parr, Public Affairs SpecialistCLARKSBURG, WEST VIRGINIA - A 27-year old Monongalia County, West Virginia, resident was sentenced on January 11, 2013, in United States District Court in Clarksburg by Judge Irene M. Keeley.
United States Attorney William J. Ihlenfeld, II, announced that: AARON FLEMING was sentenced to 51 months imprisonment to be followed by three years of supervised release. FLEMING entered pleas of guilty on October 4, 2012, to one count of Possession with Intent to Distribute Crack Cocaine and Possession of a Firearm by a Convicted Felon, with both offenses occurring on April 30, 2012, in Monongalia County. FLEMING was remanded to the custody of the United States Marshal pending designation to a Federal institution.
The case was prosecuted by Assistant United States Attorney Zelda E. Wesley and investigated by the West Virginia State Police-Bureau of Criminal Investigations, Bureau of Alcohol, Tobacco, Firearms and Explosives and the Westover Police Department.
Missouri Man Sentenced for Firearm OffenseRead the Press Release
Lavon C. Lashley, 36, from St. Louis, MO, was sentenced on January 15, 2013, in District Court in East St. Louis, IL, on one count of Unlawful Possession of a Firearm by a Previously Convicted Felon, the United States Attorney for the Southern District of Illinois, Stephen R. Wigginton, announced today.
Lashley was sentenced to 87 months in prison, three years of supervised release, fined $375 and ordered to pay $100 special assessment. Lashley, who previously pled guilty, admitted that a firearm recovered on him during a pat down search stemming from an incident on a Metro Link passenger train leading to his arrest, belonged to him. He forfeited the firearm. Lashley, admitted that he had possessed a gun, knowing that he was a convicted felon and that it was illegal for him to have a gun.
Prior to June 5, 2012, Lashley had been convicted of a crime that was punishable by a term of imprisonment of more than one year.
The investigation was investigated by the Federal Bureau of Investigation.
This case was prosecuted by Special Assistant United States Attorney Matthew H. Brooks.
Meriden Man Sentenced to Federal Prison for Selling Stolen FirearmsRead the Press Release
January 15, 2013David B. Fein, United States Attorney for the District of Connecticut, announced that COREY WILLIAMS, JR., also known as “Little Corey,” 24, of Meriden, was sentenced today by United States District Judge Janet Bond Arterton in New Haven to 20 months of imprisonment, followed by three years of supervised release, for selling stolen firearms.
According to court documents and statements made in court, WILLIAMS told his father, Khalid Aziz, that he had stolen multiple firearms from a Meriden gun store and was having trouble selling some of the “big guns.” Aziz put WILLIAMS in touch with Airess Johnson, who knew someone interested in purchasing firearms. The potential purchaser was an individual cooperating with law enforcement, and that cooperator negotiated a purchase price for three firearms with Williams.
At approximately 8:30 p.m. on February 2, 2012, WILLIAMS, Aziz, and Johnson drove to the parking lot of a New Haven restaurant. After WILLIAMS and Aziz exited the vehicle and waited in front of a nearby store, the cooperator purchased two 12 gauge shotguns and a .308 caliber semi-automatic rifle from Johnson in exchange for $1,200. After the transaction, WILLIAMS, Aziz, and Johnson departed together. WILLIAMS then paid Aziz approximately $50 for his role in facilitating the sale of the three firearms.
Law enforcement officers later recovered the three firearms from the cooperator’s vehicle. All three had been reported stolen from a federal firearms licensee in Meriden on November 5, 2011.
The owner and employees of the Meriden gun dealer subsequently identified WILLIAMS as someone who had been in the store prior to the theft of nine firearms from the store. On May 25, 2012, at WILLIAMS’s residence, law enforcement officers recovered a gun box for one of the six additional stolen firearms, as well as two boxes of ammunition, a ballistic vest carrier, and two rifle magazines.
The six additional firearms that were stolen from the Meriden gun dealer have not been recovered.
On November 2, 2012, WILLIAMS, pleaded guilty to one count of sale of stolen firearms. He had no prior criminal history.
On October 22, 2012, Aziz pleaded guilty to the same charge. On January 10, 2013, Aziz, whose criminal history included at least 19 felony convictions, was sentenced to 10 years of imprisonment.
Johnson, 35, of New Haven, pleaded guilty on July 3, 2012, to one count of possession of firearms by a previously convicted felon. On January 3, 2013, she was sentenced to 20 months of imprisonment.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with substantial assistance provided by the New Haven Police Department and the Meriden Police Department. The case was prosecuted by Assistant United States Attorney Marc H. Silverman.
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(203) 821-3722 [email protected]McKees Rocks Woman Pleads Guilty to Conspiring to Distribute Prescription DrugsRead the Press Release
PITTSBURGH - A resident of McKees Rocks pleaded guilty in federal court to a charge of violating the federal narcotics laws, United States Attorney David J. Hickton announced today.
Carol Combs, 54, pleaded guilty to one count before United States District Judge David S. Cercone.
In connection with the guilty plea, the court was advised that Combs conspired to distribute oxycodone and oxymorphone between Aug. 24, 2010 and Jan. 20, 2012.
Judge Cercone scheduled sentencing for May 28, 2013, at 10 a.m. The law provides for a total sentence of 20 years in prison, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Stephen R. Kaufman is prosecuting this case on behalf of the government.
The Drug Enforcement Administration conducted the investigation that led to the prosecution of Combs.
Mason County Man Gets Federal Prison Time for Illegally Dumping Raw SewageRead the Press Release
HUNTINGTON, W.Va. – U.S. Attorney Booth Goodwin today announced that a Mason County man was sentenced to a year and a half in federal prison for dumping a pollutant into waters of the United States without a permit. Frank Zuspan, 61, of Mason County, W.Va., previously pleaded guilty in September 2012. Zuspan admitted that in or about December 2010, he took a 2400-gallon sewage hauling truck to property in Mason County, W.Va. and illegally dumped sewage onto the property. Zuspan further admitted that the sewage was dumped into a lake and stream watershed in Mason County that connected to the Ohio River. The defendant also admitted that he discharged untreated sewage onto the Mason County property on multiple occasions between November 2010 and February 2011.
“You can’t pour raw sewage into your neighbors’ water supply,” said U.S. Attorney Goodwin. “It’s dangerous and it’s illegal, for obvious reasons. People should know better.”
“Today’s sentencing proves that anyone who damages the environment and puts the public at risk will be vigorously prosecuted,” said David G. McLeod, Jr., Special Agent in Charge of EPA’s criminal enforcement program in West Virginia.
The Environmental Protection Agency conducted the investigation. Assistant United States Attorney Erik S. Goes and Special Assistant United States Attorney Perry McDaniel handled the prosecution. The sentence was imposed by United States District Judge Robert C. Chambers.
Manhattan U.S. Attorney Announces Arrest of Hong Kong Man for Selling and Smuggling Stolen U.S. Military Equipment into the United StatesRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, James T. Hayes, Jr., the Special Agent-in-Charge of the New York Field Office of U.S. Immigration and Customs Enforcement’s (“ICE”) Homeland Security Investigations (“HSI”), and Kenneth Siegler, Resident Agent-in-Charge of the New York Office of the Defense Criminal Investigative Service (“DCIS”), today announced the arrest of KWOK KUEN LEUNG, a resident of Hong Kong, for selling equipment that had been stolen from the United States military and for smuggling that equipment and other items into the United States. LEUNG was arrested last night at the San Francisco International Airport. He was presented earlier today in federal court in the Northern District of California and ordered detained. The case has been assigned to Judge Alvin K. Hellerstein of the U.S. District Court for the Southern District of New York.
Manhattan U.S. Attorney Preet Bharara said: “Today’s indictment reveals an alleged attempt by Kwok Kuen Leung to operate under the radar to import stolen equipment into the United States that could potentially be used as weapons. Our office remains committed to ensuring that devices intended for the military and other law enforcement authorities do not get into the wrong hands.”
ICE HSI Special Agent-in-Charge James T. Hayes, Jr. said: “Kwok Kuen Leung allegedly made false statements to import and sell stolen military grade equipment. This technology is so sensitive that, if in the wrong hands, it can pose a threat to our national security. This case underscores the threat by those who attempt to circumvent U.S. Customs laws. It strengthens our resolve with our federal law enforcement partners to vigorously pursue violators.”
DCIS Resident Agent-in-Charge Kenneth Siegler said: "This investigation demonstrates the Defense Criminal Investigative Service and fellow agencies’ continued commitment to identifying individuals involved in the theft, sale, and smuggling of U.S. military technology. It is imperative that those involved in trafficking stolen Department of Defense equipment be identified and held accountable for their actions.”
According to the allegations in the Indictment unsealed today in Manhattan federal court:
On several occasions from January 2005 through March 2005, LEUNG sold infrared laser aiming devices that were stolen from United States military installations. Infrared laser aiming devices are mounted on weapons, and work by projecting an infrared laser beam on a target that cannot be seen with the naked eye, but can be seen with night-vision equipment. Laser aiming devices are generally manufactured under contract with the U.S. Department of Defense for military use or under contract with law enforcement agencies.
In addition, on multiple occasions from 2005 through 2009, LEUNG smuggled military equipment including the stolen laser aiming devices, night-vision scopes, and other items into the United States by making false and fraudulent statements in customs declaration forms. For example, LEUNG falsely stated that the majority of his shipments contained “distance measuring devices.” He also significantly understated the actual dollar value of the shipments and paid substantially less in customs duties than would have been owed if the true value of the equipment had been declared.
LEUNG, 38, resides in Hong Kong. He is charged with eight counts of falsely classifying goods for entry into the United States, eight counts of importing goods through false and fraudulent statements, eight counts of smuggling, and four counts of selling stolen military equipment. He faces a maximum penalty of 142 years in prison on all counts combined.
Mr. Bharara praised ICE HSI and DCIS for their outstanding work in the investigation.
This prosecution is being handled by the Complex Frauds Unit of the United States Attorney’s Office. Assistant United States Attorney Zachary Feingold is in charge of the prosecution.
The charges contained in the Indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.
U.S. v Kwok Kuen Leung S1 Indictment
Man Pleads Guilty to Drug ChargeRead the Press Release
US Attorney Brendan V. Johnson announced that Casey Dean Hoefert, age 33, of Sioux Falls, appeared before U.S. District Judge Karen E. Schreier on January 15, 2013, and pled guilty to an indictment that charged him with conspiracy to distribute 500 grams or more of a mixture containing methamphetamine. The charge carries a mandatory minimum penalty of 10 years and a maximum penalty of life in prison, and/or a $10 million fine.
Between May 2010 and January 2012, Hoefert acted as a middle man between two co-conspirators, accepting delivery of methamphetamine from one and delivering it to another, who gave Hoefert payment for the drugs. Hoefert then gave the money to the co-conspirator who originally provided the drugs.
The investigation was conducted by the Minnesota Bureau of Criminal Apprehension, the South Dakota Division of Criminal Investigation, and the US Drug Enforcement Administration. The case is being prosecuted by Assistant US Attorney John E. Haak.
A presentence investigation was ordered, and a sentencing date was set for April 8, 2013. The defendant was remanded to the custody of the US Marshal pending sentencing.
Logan County Pill Dealers Plead Guilty to Federal Charges in Connection with an Oxycodone Distribution SchemeRead the Press Release
Brothers admit distributing a total of more than 7,000 prescription pain pills during conspiracy
CHARLESTON, W.Va. – U.S. Attorney Booth Goodwin announced that two men pleaded guilty (Jan. 15) for their role in an illegal oxycodone distribution scheme. Michael Ray Fortuna, 45, of Peach Creek, Logan County, W.Va., pleaded guilty to conspiracy to distribute oxycodone. Fortuna’s brother and co-defendant Ronald Fortuna, 36, also of Peach Creek pleaded guilty in a separate hearing to conspiracy to distribute oxycodone.
Michael Fortuna admitted that from at least the summer of 2008 until August 18, 2011, he was involved in the distribution of prescription drugs – including oxycodone and alprazolam, also known as “Xanax,” in and around Logan County, W.Va. Michael Fortuna further admitted that he obtained oxycodone from Florida and on some instances, he or others at his direction would travel to Florida and bring oxycodone back to Logan County. Fortuna also admitted that sources of supply located in Florida mailed shipments of oxycodone to his address in Logan County, W.Va.
On April 29, 2011, investigators from the United States Postal Inspection Service executed a federal search warrant on a package addressed to Michael Fortuna. The package contained 1,789 30-milligram oxycodone tablets and bore a fictitious return address and had been shipped from Palm Bay, Fla. Investigators approached Michael Fortuna as he arrived at the Peach Creek Post Office in Logan, West Virginia to pick up the package. Michael Fortuna admitted that he had received a total of three such packages from Florida in April 2011. Additionally, Fortuna admitted that he mailed cash to his source of supply in Florida as payment for the packages. The defendant mailed one package that contained at least $30,000.
Ronald Fortuna admitted flying to Florida with two other individuals in late June or early July 2011 in order to obtain oxycodone. On July 3, 2011, investigators from the Multi-Agency Diversion Task Force in Palm Beach County, Florida arrested one of Ronald Fortuna’s companions at the West Palm Beach Airport as the men were attempting to board their return flight. The companion was found to be smuggling 1,377 30-milligram oxycodone tablets. The individual cooperated with law enforcement and stated that he, Ronald Fortuna, and the other man had been sent to Florida by Michael Fortuna to pick up the pills. He identified Michael Fortuna as the head of a drug trafficking organization that obtained oxycodone from Palm Beach County, Fla. and distributed the pills in Logan County, W.Va. The cooperating source admitted that he had been recruited to carry oxycodone pills on his person during a return flight to West Virginia.
Michael Fortuna admitted that he distributed a total of at least 4,955 30-milligram oxycodone tablets during the scheme.
Ronald Fortuna admitted that from at least the summer of 2009 until late summer 2011, he regularly sold oxycodone tablets from his Peach Creek residence located in Logan County, W.Va. Ronald Fortuna also admitted that on or about November 10, 2010, he sold four 30-milligram oxycodone tablets to an informant working for the U.S. 119 Task Force. The transaction occurred at a Peach Creek residence in Logan County.
Ronald Fortuna further admitted that he distributed a total of approximately 2,500 30-milligram oxycodone tablets during the scheme.
Both defendants face up to 20 years in prison and a $1 million fine when they are sentenced on May 2, 2013 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.
The Drug Enforcement Administration Task Force, the United States Postal Inspection Service and the Logan County Sheriff’s Department conducted the investigation. Assistant United States Attorney Joshua Hanks is in charge of the prosecutions.
Local Man Sentenced for Role in Counterfeit Check Fraud SchemeRead the Press Release
PITTSBURGH - A resident of Allegheny County has been sentenced in federal court to time served on his conviction of uttering counterfeit checks, United States Attorney David J. Hickton announced today.
Senior United States District Judge Donetta W. Ambrose imposed the sentence on Jonathan Brown, 23, of Pittsburgh, Pa.
According to the information presented to the court, Brown obtained stolen identities and then, on April 14, 2011, and negotiated counterfeit checks at Big Lots stores which he used to buy merchandise. The court was advised that Brown was involved in a larger check fraud scheme.
Assistant United States Attorney Gregory C. Melucci prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Inspectors from the United States Postal Inspection Service along with agents from the United States Secret Service who, as part of the Western Pennsylvania Financial Crimes Task Force (WPFCTF), conducted the investigation that led to the successful prosecution of Jonathan Brown. The WPFCTF was established as a collaborative, multi-agency effort to effectively combat financial crimes, including identity fraud, in Western Pennsylvania. Partnering in this effort are the United States Attorney's Office for the Western District of Pennsylvania, the United States Secret Service, the United States Postal Inspection Service, the Department of Homeland Security, the Allegheny County District Attorney's Office, the Allegheny County Police Department, the City of Pittsburgh Bureau of Police and the Pennsylvania State Police.
Lebanon Man Pleads Guilty, Faces 20 Years in Prison for Coercing a Minor to Become a Sex SlaveRead the Press Release
Human Trafficking Rescue Project
KANSAS CITY, Mo. – Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that a Lebanon, Mo., man pleaded guilty in federal court today to using the Internet to groom and entice a minor girl into illegal sexual conduct that led to years of sadomasochistic abuse.
“Today’s guilty plea brings closure to a shocking and horrific case,” Dickinson said. “Six defendants now have been brought to justice for their roles in the brutal sexual torture and enslavement of a young woman who was just a teenager when the victimization began.
“The Human Trafficking Rescue Project continues to lead the nation by breaking new ground in trafficking cases,” Dickinson added, “prosecuting both the supply and the demand, both the sex traffickers and their customers.”
Edward Bagley, Sr., also known as “Master Ed,” 45, of Lebanon, pleaded guilty before U.S. District Judge Dean Whipple to enticing a minor into illegal sexual conduct. Under the terms of today’s binding plea agreement, Bagley will face 20 years in federal prison without parole. The court will also order Bagley to pay restitution to his victim.
“Both the interest of the victim and the cause of justice have been served today,” Dickinson said. “The victim is spared having to endure a difficult trial and she can continue her healing process.”
Bagley met the female victim (identified in court documents as FV) in 2002, when she was 16 years old and dating his teenage son. FV visited his trailer residence in Lebanon on numerous occasions. Bagley knew that FV grew up in foster care, came from a troubled home life and had suffered emotional, physical, and sexual abuse in her past. He also knew that FV suffered from mental deficiencies and had previously sustained a traumatic head injury.
During FV’s visits to Bagley’s residence, he showed her images and videos of pornography on the Internet and downloaded from the Internet, including images and videos of bondage and sadomasochistic conduct. Bagley admitted that he provided FV with controlled substances. He taught her about bondage and sadomasochistic activities. His wife, co-defendant Marilyn Bagley, 47, modeled stripper and bondage clothing for FV. The Bagleys told FV that she would love being a “slave” for him. Bagley began a sexual relationship with FV prior to her seventeenth birthday.
FV viewed Edward Bagley as her boyfriend and moved into the Bagleys’ residence in 2003. They provided FV her own room and clothes, and promised her a great life.
Over the course of the next six years, Edward Bagley executed sadomasochistic acts on FV, including sewing her vagina closed, whipping and flogging her body, penetrating her breasts with needles and skewers, suffocating her with plastic bags, strangling her with rope, putting her in a dog cage, and electrocuting FV’s sexual organs with devices which produced electrical voltage. Edward Bagley photographed and videotaped many of the acts he performed on her.
Edward Bagley is the sixth and final defendant to be convicted in this case. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
Five defendants have pleaded guilty to their roles in a conspiracy to commit sex trafficking by force, fraud or coercion. This is the first time nationwide that the customers, or “Johns,” have been convicted under the Trafficking Victims Protection Act in a sex trafficking case in which the victim was an adult.
Marilyn Bagley pleaded guilty on Dec. 6, 2012, to her role in the conspiracy. According to Marilyn Bagley’s plea agreement, the victim was subject to sadistic acts of torture that increased in quantity and intensity over a six-year time period. They involved, for example, strangulation, suffocation, breast and vaginal penetration with skewers, and electrical voltage. FV would be punished if she did not do as instructed.
Marilyn Bagley admittedly knew that other individuals, including four co-defendants who have pleaded guilty in this case, came to the residence to engage in sexual conduct and sadistic acts on FV. They provided bondage pornography, meat, cigarettes, and cash, among other items, in exchange for the sessions involving sexual conduct and sadistic acts on FV.
Under the terms of her binding plea agreement, Marilyn Bagley will receive a sentence of probation. The government stated in court that Marilyn Bagley is considered in a separate category from the other defendants in this case because she was a victim of extensive physical and emotional abuse for over 25 years prior to her criminal conduct and participation in the conspiracy. Her participation in the criminal conduct resulted in the abuse being redirected away from her and to the victim.
Co-defendant Michael Stokes, also known as “The Rodent,” 47, of Lebanon, pleaded guilty on Jan. 5, 2012, to participating in the conspiracy.
Stokes became familiar with FV in 2006 when he received pictures of her over the Internet in which she was naked with whip marks over her body. Stokes was told that the victim was a slave for “life” who was tortured for hours at a time and was required to do “everything and anything” she was told. After a few weeks of chatting online, the plea agreement says, a co-conspirator brought the victim to Stokes’ house so she could do a “demo” for him. When they arrived at Stokes’ residence, bringing a duffle bag of torture devices with them, FV was instructed to “put on a show for us.” FV was naked, wearing only dog collars and ankle collars with locks. Stokes was asked whether he wanted to have sex with her. Stokes said “yes” and he had sex with FV.
Stokes was stunned that “someone had that much control over someone” and “had never seen anything like it.”
Stokes began visiting the residence where FV was being held. During his first visit, he was shown a photo of FV’s vaginal opening sewn shut and told this was done to demonstrate “what was expected of her.” FV was present for these statements and remained silent. FV never talked back or spoke up. FV never offered herself to Stokes and only acted on command.
Stokes visited the residence eight to 12 times. During these visits, he would receive sexual acts or be allowed to watch or participate in torturing FV. When he visited he brought steaks, hamburgers, jackets, personalized playing cards, lighters, cigarettes, and cash. Among other things, he witnessed FV being tortured with a crank phone, with electricity shot through devices clamped to her vaginal and anal openings.
Stokes began assisting in promoting FV at the strip clubs. Stokes took photos of FV around to the clubs to promote her there. Stokes gave $1,000 so that FV could be taken for a sexual bondage photo shoot in California for Taboo magazine. Stokes then took a copy of the magazine to promote her at the clubs. The photos in Taboo magazine were extremely mild and did not depict any of the cruel sessions Stokes had witnessed at the residence.
In 2009, Stokes was warned that there was an FBI investigation involving his conduct with FV. Stokes went on his computer and deleted hundreds of photos, his contacts with other females online, pictures of FV that he saved, and destroyed his copies of Taboo magazine and the sexual devices that he had acquired.Under federal statutes, Stokes is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution.
Co-defendant Bradley Cook, also known as APutHer2GoodUse,@ 34, of Kirkwood, pleaded guilty on Dec. 20, 2011, to participating in the conspiracy.
From 2006 to 2009, Cook watched the victim being sexually abused and tortured in live online sessions and as depicted in photos and videos that he downloaded from the Internet. Cook admitted that he traveled to Lebanon on multiple occasions during that time to engage in sessions of sexual acts and torture with the victim. In exchange, Cook paid the victim=s Amaster@ for these sessions with such items as computer hard drives that contained images and videos of bondage, domination, sadism and masochism, which he had downloaded from the Internet.
Cook also admitted he was aware of other men who engaged in sexual acts and torture with the victim. He witnessed the victim being whipped and locked in a dog cage, as well as being tied up and shocked with multiple electrical devices. Cook described the abuse suffered by the victim as the Amost extreme@ he had ever seen.
Under the terms of a binding plea agreement, Cook is subject to a sentence of 20 years in federal prison without parole. Cook must also pay restitution to the victim. In addition to the sentence of imprisonment, the court may impose a term of supervised release up to life. Cook must also forfeit to the government the computer media he used to commit the offense.
Co-defendant Dennis Henry, 53, of Wheatland, formerly the postmaster of Nevada, Mo., pleaded guilty on March 24, 2011, to participating in the conspiracy. Henry also pleaded guilty to transporting the victim across state lines for sexual activity.
Henry admitted that he engaged in sex with the victim, and participated in torture sessions with FV that would last for hours. Henry saw pictures of FV=s vagina sewn shut, which he was told was a form of punishment. Henry also admitted that he visited FV at a Lebanon strip club where she was forced to work.
Under federal statutes, Henry is subject to a sentence of up to 15 years in federal prison without parole, plus a fine up to $500,000 and an order of restitution.
Co-defendant James Noel, 47, of Springfield, pleaded guilty on Feb. 24, 2011, to participating in the conspiracy. Noel admitted that he was one of the customers who sexually abused and tortured FV. Noel watched the victim being tortured and sometimes operated torture devices himself beginning in 2006, when she was approximately 20 years old. For example, Noel knew that FV hated being electrocuted with a crank phone (which was wired inside FV=s vaginal and anal openings and to her toes), which he described as Aextremely painful,@ but he used it on her anyway.
Under federal statutes, Noel is subject to a sentence of up to five years in federal prison without parole, plus a fine up to $250,000 and an order of restitution.
This case is being prosecuted by Assistant U.S. Attorneys Cynthia L. Cordes, Paul Becker and John Cowles with assistance from the Department of Justice Civil Rights Division's Human Trafficking Prosecution Unit. It was investigated by the FBI in conjunction with the Human Trafficking Rescue Project.
Lawyer Sentenced to Two Years in Prison for Tax EvasionRead the Press Release
Las Vegas, Nev. – Las Vegas lawyer Charles C. LoBello has been sentenced to two years in prison and ordered to pay $260,625 in restitution to the IRS for his guilty plea to one count of tax evasion for the 2002 tax year, announced Daniel G. Bogden, United States Attorney for Nevada.
LoBello was sentenced on Monday, Jan. 14, 2013, by U.S. District Judge James C. Mahan, and must self-report to federal prison by April 15, 2013.
According to the court records, LoBello, who operated as a sole practitioner in Las Vegas, concealed over $900,000 in income from the United States, intentionally gave incomplete information to his bookkeeper and tax return preparer, and used personal checking accounts to hide large checks he received as legal fees. LoBello admitted in his guilty plea agreement that for the years 2001 through 2005, he owed an additional $260,625 in income taxes.
LoBello’s brother, Mark LoBello, also a Nevada attorney, pleaded guilty to tax evasion in August of 2008, and was sentenced by Judge Mahan on Dec. 1, 2008, to 15 months in prison. Mark LoBello’s license to practice law was subsequently suspended by the Nevada Bar in December 2008.
The case was investigated by IRS Criminal Investigation and prosecuted by Department of Justice Tax Division Trial Attorneys Thomas W. Flynn and Dennis R. Kihm.
Kissimmee Man Sentenced to More Than Two Years in Prison for Copyright Infringement and Pirating DVDsRead the Press Release
Orlando, Florida - U.S. District Judge Charlene Edwards Honeywell today sentenced Patrick Jason Thomas (32, Kissimmee) to 2 and one-half years in federal prison for reproducing and distributing DVDs containing copyrighted movies. The court also ordered Thomas to forfeit approximately 10,000 pirated DVDs and several pieces of computer and DVD-copying equipment, which he used to produce the pirated DVDs. In addition, Thomas was ordered to pay the Motion Picture Association of American $100,000 in restitution. Thomas pleaded guilty on October 24, 2012.
According to court documents, on June 8, 2012, the Osceola County Sheriff’s Office (OCSO) executed a search warrant at Thomas’ home. During the search, agents discovered thousands of counterfeit DVDs and electronic equipment used to produce those counterfeit DVDs. For example, in the garage, agents found a metal shelving unit that held about 6,000 DVDs, along with plastic cases, and several binders of catalogued movies. Thomas used computer equipment to decrypt and extract copyright protected data from DVDs and Blu-Ray discs, and then reproduce and sell movies illegally.
This case was investigated by the Federal Bureau of Investigation and the Osceola County Sheriff's Office. It was prosecuted by Assistant United States Attorney Daniel C. Irick.
Justice Department Reaches Settlement with Community State Bank Regarding Alleged Lending Discrimination in MichiganRead the Press Release
Community State Bank of St. Charles, Mich., will open a loan production office in an African-American neighborhood in Saginaw, Mich., invest $165,000 in majority African-American areas in and around Saginaw and take other steps as part of a settlement to resolve allegations that it engaged in a pattern or practice of discrimination on the basis of race, the Justice Department announced today.
The settlement, which remains subject to court approval, was filed in conjunction with the department’s complaint in the U.S. District Court for the Eastern District of Michigan. The complaint alleges that Community State Bank violated the Fair Housing Act and the Equal Credit Opportunity Act (EOCA), which prohibit financial institutions from discriminating on the basis of race in their lending practices. The lawsuit alleges that Community State Bank between 2006 and 2009 served the credit needs of the residents of predominantly white neighborhoods in the Saginaw and Flint metropolitan areas to a significantly greater extent than it served the credit needs of majority African-American neighborhoods. Those neighborhoods are easily recognized because the Saginaw area has long had highly-segregated residential housing patterns, especially for African-Americans.
“The complaint filed today shows that the practice of drawing lending areas with boundaries that exclude borrowers in predominately minority neighborhoods is not just a shameful historical practice,” said Thomas E. Perez, Assistant Attorney General for the Justice Department’s Civil Rights Division. “We are pleased that Community State Bank will improve access to responsible and affordable credit to qualified borrowers in Saginaw’s minority neighborhoods.”
Barbara McQuade, the U.S. Attorney for the Eastern District of Michigan added: “Today’s settlement will bring badly needed resources to Saginaw and the surrounding areas. It will broaden opportunities for home ownership and home improvement for families who live in neighborhoods where credit has been unlawfully limited. We appreciate the bank’s cooperation in resolving this case.”
The lawsuit originated from a referral by the Federal Deposit Insurance Corporation (FDIC) to the Justice Department’s Civil Rights Division. Community State Bank is regulated by the FDIC.
Under the settlement, Community will invest $75,000 in a special financing program to increase the amount of credit the bank extends to majority African-American neighborhoods in and around Saginaw, $75,000 in partnerships with organizations that provides credit, financial, homeownership, and/or foreclosure prevention services to the residents of these neighborhoods, and $15,000 in outreach that promotes its products and services to potential customers in these neighborhoods. Community also will open a loan production office in a majority African-American neighborhood of Saginaw and conduct fair lending training for its employees. The agreement also prohibits Community from discriminating on the basis of race in any aspect of a credit transaction.
The Justice Department’s enforcement of fair lending laws is conducted by the Fair Lending Unit of the Housing and Civil Enforcement Section in the Civil Right Division. Since the Fair Lending Unit was established in February 2010, it has filed or resolved 23 lending matters under the Fair Housing Act, the ECOA and the Servicemembers Civil Relief Act. The settlements in these matters provide for a minimum of $660 million in monetary relief for impacted communities and more than 300,000 individual borrowers. The attorney general’s annual reports to Congress subject to the ECOA highlight the department’s accomplishments in fair lending and are available at www.justice.gov/crt/publications .
This settlement was accomplished as part of the Financial Fraud Enforcement Task Force’s (FFETF) Non-Discrimination Working Group which focuses on discrimination in the housing and finance markets and is co-chaired by Assistant Attorney General for the Civil Rights Division Tom Perez. The Civil Rights Division, the U.S. Attorney’s Office for the Eastern District of Michigan and the FDIC are members of the FFETF, an interagency initiative, established by President Obama in 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force’s efforts, visit www.StopFraud.gov .
Additional information about fair lending enforcement by the Justice Department can be obtained from the Justice Department’s website at www.justice.gov/fairhousing .
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Community Complaint
Community Consent OrderJury Convicts Utah Man of Child Pornography ChargesRead the Press Release
WASHINGTON – A Utah man was convicted late yesterday by a federal jury in Salt Lake City of possessing, receiving and distributing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney David B. Barlow of the District of Utah.
Michael Loren Dunn, 43, of Park City, Utah, was convicted of one count each of possession, receipt and distribution of child pornography. U.S. District Judge Robert J. Shelby presided over the week-long trial.
According to evidence presented at trial, Dunn, who works in the computer industry, received and shared child pornography, and encrypted the files so that they could only be accessed by him. Evidence of child pornography was recovered from three different computers and two external hard drives owned by Dunn. Evidence also showed that the overwhelming majority of files the defendant searched for contained terms indicative of child pornography content.
Judge Shelby set sentencing in the case for April 8, 2013. Dunn faces up to 10 years in federal prison for his conviction on possession of child pornography. The potential maximum penalties for the receipt of child pornography and distribution of child pornography counts are 20 years per count with mandatory minimum five-year sentences for each count.
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 U.S. 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 as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was investigated by special agents of the FBI and prosecuted by Assistant U.S. Attorneys Mark K. Vincent and Carol A. Dain of the District of Utah, and Trial Attorney Jeffrey H. Zeeman of CEOS.
Jury Convicts Nashua Tax Preparer for Filing False Tax ReturnsRead the Press Release
CONCORD, N.H. –Maria M. Ulloa, 51, of Nashua, was convicted in United States District Court for the District of New Hampshire of filing false, fictitious and fraudulent claims for tax refunds with the Internal Revenue Service following a five day jury trial, announced United States Attorney John P. Kacavas.
Ulloa operated Main Travel, a Nashua business that provided, among other things, federal income tax return preparation services. During the 2007 and 2008 tax filing seasons, she filed ten false federal income tax returns in the names of her clients, diverting most of the resulting inflated tax refunds to herself. The jury returned guilty verdicts on all ten counts.
Ulloa faces a maximum sentence of three years in prison and criminal fines of up to $250,000 on each count. Ulloa will be confined to her home and subject to electronic monitoring pending sentencing which is presently scheduled for April 29, 2013.Ulloa’s prosecution arose from an investigation by the Internal Revenue Service’s Criminal Investigation office in Manchester. The case is being prosecuted by Assistant United States Attorneys Nick Abramson and Bill Morse.
Johnstown Man Charged with Distributing HeroinRead the Press Release
JOHNSTOWN, Pa. - A resident of Johnstown, Pa., has been indicted by a federal grand jury in Johnstown on a charge of distribution of heroin, United States Attorney David J. Hickton announced today.
The one-count indictment named Maurice L. Lindsay, 37, as the sole defendant.
According to the indictment, on Nov. 3, 2011, Lindsay distributed less than 100 grams of heroin.
The law provides for a maximum total sentence of 20 years in prison, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.
The Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Cambria County Drug Task Force conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Investment Company Owner Pleads Guilty to Wire Fraud and Money LaunderingRead the Press Release
CONTACT: Fred Alverson
Public Affairs Officer
CINCINNATI – Glen Galemmo, 48, of Cincinnati, who owned Queen City Investments and other investment companies in the Cincinnati area, pleaded guilty in U.S. District Court to wire fraud and money laundering, admitting that he defrauded investors by soliciting millions of dollars from them between 2005 and July 2013 and spent the money rather than investing it.
Carter M. Stewart, United States Attorney for the Southern District of Ohio and Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service Criminal Investigation (IRS) announced the pleas entered today before Senior U.S. District Judge Herman Weber.
According to court documents, Galemmo lured investors with promotional materials falsely claiming returns of more than 30 percent over seven years.
From 2006 to July 2013, Galemmo received approximately $87 million cumulatively from individual investors, trusts, charitable organizations, and retirement accounts. During this time, Galemmo also received approximately $29 million from some of these investors in the form of short-term loans. The vast majority of these funds were never invested in anything. Rather, the funds were paid to other investors in the form of principal and/or interest payments or spent by Galemmo to finance other businesses or pay for personal expenses.
To induce investors to continue to invest with him, Galemmo mailed or emailed fraudulent monthly statements to investors. To create the monthly statements, each client's principal investment balance was merely multiplied by a fictitious percentage of return, consistent with the returns that Galemmo had promised to his clients. The statements showed positive account balances and fictitious earnings, when in fact, the money had not been invested as promised. Galemmo issued account statements for approximately 260 different investment accounts for the month of April 2013 reporting that these accounts held a total of approximately $109 million. In fact, Queen City Investments held only a small fraction of that balance on behalf of clients.
Galemmo’s investment scheme involved approximately 200 investors.
Each crime is punishable by up to 20 years in prison, restitution and forfeiture but the court will determine the actual sentence after it conducts its own investigation. Judge Weber scheduled sentencing for May 28, 2014 at 10 a.m.
Galemmo agreed to forfeit three pieces of real estate, including a condo in Marco Island, Florida, the contents of bank and investment accounts and five vehicles. The plea agreement requires Galemmo to make restitution to the investors in an amount to be determined by the court prior to sentencing.
“A person who creates a web of financial lies will soon be caught up in it. Mr Galemmo offered rates of return of over 30% to his clients and unfortunately these were false promises, “ said Kathy A. Enstrom, Special Agent in Charge, IRS, Criminal Investigation, Cincinnati Field Office.
U.S. Attorney Stewart commended the investigation by IRS special agents as well as Assistant U.S. Attorneys Emily Glatfelter and Tim Mangan, who are prosecuting the case.
Informational: Federal Court ArraignmentRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on January 11, 2013, before U.S. Magistrate Judge Carolyn S. Ostby, the following individual was arraigned:
ERIN RUTH SMITH, a 22-year-old resident of Wyola, appeared on (3) counts of assault resulting in serious bodily injury. He is currently detained. If convicted of these charges, SMITH faces possible penalties of 10 years in prison, a $250,000 fine, and 3 years supervised release for each count. Assistant U.S. Attorney E. Vincent Carroll is the prosecutor for the United States. The investigation was a cooperative effort between the Bureau of Indian Affairs and the Federal Bureau of Investigation.
The defendant pled not guilty to the charges.
The charge, an indictment, information or complaint, is merely an accusation and all persons named as defendants are presumed innocent until proven guilty. A pre-trial conference and a trial date will be set and the United States will be required to prove the allegations set forth in the indictment beyond a reasonable doubt.
Information for Victims Regarding the Sentencing of Russell Wasendorf, Sr.Read the Press Release
The sentencing in United States v. Russell R. Wasendorf, Sr. has been set for January 31, 2013, at 9:00 a.m. The hearing will be held at 111 7th Avenue SE, Cedar Rapids, Iowa, in Courtroom 1 (2nd Floor), before Chief United States District Court Judge Linda R. Reade. Russell Wasendorf, Sr. remains in custody pending sentencing.
Under the Crime Victims Rights Act (Title 18, United States Code, Section 3771), victims of federal crimes generally have the right to attend and be reasonably heard at the sentencing of a defendant. Victims wishing to attend Russell Wasendorf, Sr.’s sentencing hearing and/or address the Court during the hearing are requested to contact Shari Konarske, Victim-Witness Coordinator, so that appropriate arrangements can be made. Victims may contact Ms. Konarske at [email protected] or (319) 363-6333. Media interested in seating in the courtroom should contact Robert Phelps, Clerk of Court, at
(319) 286-2311.The United States Attorney’s Office for the Northern District of Iowa has a dedicated telephone line and a page on its website to provide case updates and other information for victims in this case. The telephone number for the U.S. Attorney’s Office Victim Information Line has changed. The new number is (319) 731-4034. Victims can call this number to hear a recorded message providing the latest updates on the case. Victims can also view the Victim Witness Assistance link on the United States Attorney’s website to receive updated case information. The website can be found at www.justice.gov/usao/ian/VWwasendorf.html.
Hillsborough County Real Estate Director Pleads Guilty to Mortgage FraudRead the Press Release
Tampa, Florida - United States Attorney Robert E. O'Neill announces that Anthony Haynes (53, Seffner) today pleaded guilty to two counts of wire fraud affecting a financial institution. He faces a maximum penalty of 30 years in federal prison on each count. As part of the plea agreement, Haynes has agreed to a money judgment of at least $990,498.00, representing the proceeds of his conduct. Haynes was indicted on September 21, 2012. A sentencing date has not yet been set.
According to the plea agreement, Haynes, who was employed as the real estate services director for Hillsborough County Board of County Commissioners, made material misrepresentations in connection with loan applications and closing documents for two personal mortgages. The mortgages were for his purchase of nine land lots located in Tennessee. The mortgages were funded by interstate wires from a federally insured bank, and the closing was conducted by mail.
This case was investigated by Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Kelley C. Howard-Allen.
Henry Lopez and April Tyson Sentenced in U.S. District CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on January 14, 2013, before U.S. District Judge Sam E. Haddon, HENRY LOPEZ, a 50-year-old resident of Los Angeles, California, and APRIL ANN TYSON, a 29-year-old resident of Seattle, Washington, appeared for sentencing. Anthony Ryan Yeverino, a 19-year-old resident of Seattle/Los Angeles, and Louis James Romero, a 44-year-old resident of Seattle/Los Angeles, were previously sentenced for their role in the conspiracy.
LOPEZ was sentenced to a term of:
Prison: 360 months
Special Assessment: $100
Supervised Release: 5 years
TYSON was sentenced to a term of:
Prison: 120 months
Special Assessment: $100
Supervised Release: 5 years
YEVERINO was sentenced to a term of:
Prison: 63 months
Special Assessment: $100
Supervised Release: 5 years
ROMERO was sentenced to a term of:
Prison: 235 months
Special Assessment: $100
Supervised Release: 6 years
LOPEZ, TYSON, Yeverino and Romero were all sentenced in connection with their guilty pleas to conspiracy to possess with the intent to distribute methamphetamine or possession with intent to distribute methamphetamine.
In Offers of Proof filed by Assistant U.S. Attorney Jessica A. Betley, the government stated it would have proved at trial the following:
During late November 2010, LOPEZ, Louis Romero, and X.X. began devising a plan and agreement to distribute methamphetamine from Los Angeles, California, and Seattle, Washington, to the state of Montana. April Tyson and Anthony Yeverino also became involved in this agreement. LOPEZ, Romero, and X.X. helped find people in Montana to distribute and sell the methamphetamine in Browning and Great Falls.
In early 2011, LOPEZ, Romero, and X.X. began supplying and fronting a confidential source (CS) with methamphetamine to sell in Montana. The CS was instructed to return the payments from the sale of the methamphetamine to LOPEZ, Romero, and X.X.. From approximately January through May of 2011, over 500 or more grams of a substance containing a detectable amount of methamphetamine was distributed in Browning and Great Falls under the direction of LOPEZ, Romero, and X.X.. In addition, on two separate occasions in June 2012, LOPEZ mailed over 50 grams or more of a substance containing a detectable amount of methamphetamine to Great Falls.
Law enforcement then became alerted to TYSON and Yeverino, who lived in Seattle, Washington. TYSON and Yeverino helped assist LOPEZ, Romero and X.X., with the distribution of methamphetamine to Montana. On June 22, 2012, Yeverino, Romero and X.X., intended to bring approximately an additional four pounds of methamphetamine to Montana. The plan did not occur on that date, however, they agreed to bring the methamphetamine a few days later, on June 27, 2012.
X.X., Romero, Yeverino, and TYSON agreed that Yeverino would bring the methaphetamine by train from Seattle to Shelby, Montana. Romero paid for Yeverino's train ticket, and TYSON drove Yeverino to the train station. Yeverino had 500 or more grams of a substance containing a detectable amount of methamphetamine concealed under his shirt. Law enforcement arrested Yeverino in Shelby, Montana.
The coordinated efforts of local, state and federal law enforcement in this case is truly a testament to what can be accomplished by a team mentality," said United States Attorney Michael W. Cotter, District of Montana. "The arrests and convictions in this case have stopped a torrent of methamphetamine that was coming in from out-of-state and poisoning our communities."
FBI Special Agent in Charge David J. Johnson of the FBI Salt Lake City Division: "Cities such as Great Falls and Browning, Montana should never become home base for illegal drug operations and this case highlights how law enforcement collaboration bring defendants to justice and leads to safer communities. I would like to congratulate the Montana Regional Violent Crimes Task Force for its dedicated work on this investigation and its tireless efforts to rid our cities of drugs, gangs, and violence."
Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that all defendants will likely serve all of the time imposed by the court. In the federal system, defendants do 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 Federal Bureau of Investigation Montana Regional Violent Crimes Task Force.
Hampton Man Sentenced for Role in Drug Deal ShootoutRead the Press Release
NEWPORT NEWS, Va. – Randell Lamont Woods, 24, of Hampton, Virginia, was sentenced yesterday to 66months in prison, followed by four years of supervised release, for conspiracy to distribute cocaine.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia and Anton A. Bell, Commonwealth’s Attorney for the City of Hampton, made the announcement after sentencing by United States District Judge Raymond A. Jackson.Woods pled guilty on June 11, 2012.
According to court documents, on December 27, 2011, Woods planned a drug delivery in the parking lot of the Hampton Walmart. During the course of the drug deal, twenty-five shots were exchanged between Christopher Vinson, David Andrews, and a third individual. Woods was armed with a stolen .45 caliber firearm and provided cover to Andrews during the shootout. Woods and Andrews retreated to a nearby motel where they surrendered to Hampton Police after a seven hour standoff.Christopher Vinson pled guilty to his participation in the crime on April 23, 2012 and was sentenced on September 10, 2012, to 96 months in prison and three years of supervised release. David Andrews pled guilty on June 5, 2012, and was sentenced on September 24, 2012, to 228 months in prison and five years of supervised release.
This case was investigated by the Federal Bureau of Investigation and the Hampton Police Division. Special Assistant United States Attorney Timothy Murphy prosecuted 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.Greenland, New Hampshire Man Sentenced to 33 Months in PrisonRead the Press Release
CONCORD, N.H. – William Orestis, 64, of Greenland, New Hampshire, was sentenced in United States District Court for the District of New Hampshire to 33 months in prison and 3 years of supervised release for a mail fraud offense, announced United States Attorney John P. Kacavas.
From approximately November 2003 to July 2010, Orestis and Steven Lewis solicited money on behalf of a sham investment company, Equivest, LLC. Orestis and Lewis falsely assured investors that their money would be used to purchase foreign currencies and to support Equivest’s business activities. They provided bogus account statements to investors that falsely claimed that impressive profits had been earned in Equivest accounts by other investors. They also falsely assured many investors that their accounts would earn 12 percent interest annually and promised other investors that their accounts would earn income at rates as high as 18 percent annually.Orestis and Lewis fraudulently obtained approximately $696,732 from investors, but used only a portion of that money to buy foreign currencies and made payments totaling approximately $124,715 to some investors in order to lull them into a false sense of security regarding the performance of their Equivest accounts. As a result, the investors were defrauded of about $572,017.
On December 11, 2012, Lewis pled guilty to wire fraud. He is scheduled to be sentenced on March 28, 2013.
The case was investigated by the United States Postal Inspection Service and prosecuted by Assistant United States Attorney Bob Kinsella.
Fulton Man Sentenced to 20 Years for Child Pornography OffensesRead the Press Release
SYRACUSE, NY – United States Attorney Richard S. Hartunian announced that LEONARD ALLEN, age 46, of Fulton, New York was sentenced today in U.S. District Court in Syracuse following his earlier guilty plea in January 2012 to knowingly distributing, receiving and possessing child pornography via the Internet.
United States District Court Judge Hon. Norman A. Mordue sentenced ALLEN to concurrent terms of imprisonment of 240 months imprisonment for distributing, receiving and possessing child pornography. Following his term of incarceration ALLEN will be placed on supervised release for life, and he will be required to register as a sex offender.
ALLEN’s arrest came after he sent images of child pornography to an undercover police officer in Keene, New Hampshire, in 2010. Based upon that information, the Oswego County Sheriff’s Office executed a search warrant at ALLEN’s Fulton residence, and found that ALLEN had been distributing child pornography to others on the internet, and that he had downloaded and collected thousands of images and videos depicting children in engaged in sexually explicit conduct.
ALLEN’s arrest is the result of an investigation by the Oswego County Sheriff’s Office, the Keene, New Hampshire Police Department, and the Federal Bureau of Investigation, and was prosecuted by Assistant U.S. Attorney Lisa Fletcher.
ALLEN was prosecuted by the United States Attorney’s Office as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Four Conspirators Arrested for Operating "Pill Mills"Read the Press Release
Owner and Doctors at AMARC Clinics Charged with Illegally Distributing Large Quantities of Oxycodone Pills and Other Controlled Substances
ATLANTA – A pain clinic owner, an office manager who was the wife of the owner, and two doctors have been indicted for the illegal sale and distribution of pain killers to addicts and drug dealers at three AMARC pain clinics in metropolitan Atlanta. Godfrey Ilonzo, 63, of Alpharetta, Georgia; Bona Ilonzo, 51, of Alpharetta, Georgia; Dr. Nevorn Askari, 57, of Monroe, Georgia; and Dr. William Richardson, 59, of Atlanta, Georgia, were indicted and arrested on federal drug and money laundering charges for their respective roles in operating so-called “pill mill” pain clinics. Godfrey Ilonzo was also indicted individually on charges relating to federal bankruptcy fraud. The defendants were arraigned today at 2 p.m., before United States Magistrate Judge Janet F. King. The federal grand jury indicted the defendants on January 8, 2013.
United States Attorney Sally Quillian Yates said, “The abuse of pain medication has become epidemic and now accounts for more deaths than all traditional illegal drugs combined. The defendants in this case are charged with preying on drug addicts, feeding their addictions in order to make a profit. Prosecuting those who perpetrate prescription drug abuse is one of the critical missions of this office, and we will continue to investigate and prosecute other pill mills in this district.”
Harry S. Sommers, Special Agent in Charge of the DEA Atlanta Field Division said, “DEA and its law enforcement counterparts will continue to target and crack down on unscrupulous pain clinics. Today’s arrests have dismantled this criminal enterprise, which was responsible for the illegal distribution of dangerous doses of oxycodone and other controlled substances. The success of this investigation is a direct result of the hard work and dedication put forth by our federal, state, and local law enforcement counterparts.”
“IRS Criminal Investigation is proud to contribute our financial expertise in an effort to halt the illegal sale and distribution of prescription drugs,” stated Special Agent in Charge, Veronica Hyman-Pillot. “We are committed to unraveling financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money.”
Mark F. Giuliano, Special Agent in Charge, FBI Atlanta Field Office, stated: “This case necessitated the expertise of several federal law enforcement agencies due to the various criminal charges alleged. The FBI will continue to work with its local, state, and federal law enforcement partners in bringing such investigations forward for prosecution.”
According to United States Attorney Yates, the charges and other information presented in court: In 2009, agents of the Tactical Diversion Squad of the Drug Enforcement Administration (DEA), learned that physicians at an AMARC clinic, located at 1755 Lakewood Avenue, Atlanta, Georgia, prescribed pain pills outside the bounds of legitimate medical practice. Subsequently, DEA, working with IRS, FBI, and officers from other state and local agencies, learned that Godfrey Ilonzo has financed and operated multiple pain clinics in the Atlanta area under the “AMARC” name, including the Lakewood Avenue clinic and two other clinics located at 1135 Senoia Road, Tyrone, Georgia, and 207 Edgewood Avenue, Atlanta, Georgia. Bona Ilonzo (Godfrey Ilonzo’s wife) served as the office manager at the main AMARC pain clinic at Lakewood Avenue. At various times, Askari and Richardson served as the primary doctors for the AMARC pain clinics.
The indictment charges that, in their respective capacities, the defendants worked together to facilitate the prescribing of oxycodone pills and other controlled substances to addicts and distributors. The clinics generated mass profits by charging patients cash for appointments during which Askari and Richardson issued prescriptions for controlled substances for medically inappropriate and potentially lethal dosages and combinations. Askari and Richardson allegedly did so, however, without conducting adequate medical examinations. The indictment also alleges that, after an initial in-person appointment, Askari repeatedly “pre-signed” additional prescriptions for the same amounts and types of controlled substances for patients without ever seeing the patients again in-person. Askari did so, however, while falsely indicating in the patient’s file that she had conducted an in-person examination of the patient.
The indictment alleges that the AMARC pain clinics constituted a drug distribution operation with very high volumes of patients, many of whom visited the clinics in groups from other counties in Georgia and surrounding states. Many of those visiting had apparent signs of being addicts or drug dealers. The defendants allegedly made millions of dollars during the operation of the AMARC pain clinics which they used to recruit additional physicians and patients to the AMARC pain clinics, and to open additional clinics under the “AMARC” name. The indictment also seeks to forfeit the professional medical licenses that Askari and Richardson used to further the illegal prescribing at the AMARC pain clinics.
The charges each carry a maximum statutory penalty of 20 years in prison and a fine of up to $250,000. In determining the actual sentence, the Court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
Members of the public are reminded that the indictment contains only allegations. A defendant is presumed innocent of the charges and it will be the government's burden to prove a defendant's guilt beyond a reasonable doubt at trial.
This case was investigated by Special Agents of the Drug Enforcement Administration, the Internal Revenue Service Criminal Investigation, and the Federal Bureau of Investigation.Assistant United States Attorneys G. Scott Hulsey and Laurel R. Boatright are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Information Office at [email protected] or (404) 581-6016. The Internet address for the HomePage for the U.S. Attorney's Office for the Northern District of Georgia is www.justice.gov/usao/gan.
Fort Dodge Man Pleads Guilty TO Methamphetamine ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine pled guilty January 15, 2013, in federal court in Sioux City.
Troy Fulkerson, 42, from Fort Dodge, Iowa, was convicted of one count of conspiring to distribute methamphetamine and one count of possessing with intent to distribute methamphetamine.
At the plea hearing, Fulkerson admitted his involvement in a conspiracy from about 2011 through October 2012 that distributed more than 150 grams of actual (pure) methamphetamine in the Fort Dodge, Iowa, area. Fulkerson also admitted to distributing more than 19 grams of methamphetamine on four separate occasions to individuals cooperating with law enforcement. On October 1, 2012, law enforcement officers executed a search warrant at Fulkerson’s residence and seized over 30 grams of actual (pure) methamphetamine which Fulkerson admitted he planned to distribute to others. Fulkerson resides within 1000 feet of a protected location, Holy Rosary School Park.
Sentencing before United States District Court Judge Mark W. Bennett will be set after a presentence report is prepared. Fulkerson remains in custody of the United States Marshal pending sentencing. On the conspiracy conviction, Fulkerson faces a mandatory minimum sentence of 10 years’ imprisonment and a possible maximum sentence of life imprisonment, a $20,000,000 fine, a special assessment of $100, and at least ten years of supervised release following any imprisonment. On the possession conviction, Fulkerson faces a mandatory minimum sentence of 5 years’ imprisonment and a possible maximum sentence of 80 years’ imprisonment, a $10,000,000 fine, a special assessment of $100, and at least eigth 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, Fort Dodge Police Department, Webster County Sheriff’s Office, Clay County Sheriff’s Office, Story County Sheriff’s Office, and the Iowa Division of Criminal Investigation.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 12-3049.
Former Port Authority Board Member Sentenced to 57 Months in PrisonRead the Press Release
Robert M. Peto, a former member of the Cleveland-Cuyahoga County Port Authority, was sentenced to more than four years in prison today after previously pleading guilty to violating the Hobbs Act, law enforcement officials said today.
Peto, 58, lives in Gates Mills, Ohio. He served as a member of the Port Authority Board between December 2004 through in or around August 2012, according to court documents.
Peto obtained property not due to him or his Port Authority office including free and discounted home improvements and materials, entertainment, and a financial benefit related to a vehicle acquisition, according to court documents.
The property and objects were provided by Michael Forlani and/or Doan Pyramid LLC and Neteam, AVI, companies in which Forlani had an ownership interest, according to court documents.
“This sentence shows the high cost to those who would violate the public’s trust in exchange for personal gain,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office. “Corruption – in this case taking bribes and utilizing his position as a board member for the Port Authority – will not be tolerated.”
The conduct took place between 2004 and Oct. 2, 2007, according to court documents.
The case was prosecuted by Assistant United States Attorneys Antoinette T. Bacon and Nancy L. Kelley following an investigation by the Federal Bureau of Investigation, the Department of Labor and Internal Revenue Service – Criminal Investigation.
Former Oklahoma City Attorney Pleads Guilty to $3 Million Dollar FraudRead the Press Release
Tulsa, Oklahoma - United States Attorney Danny C. Williams, Sr., announced today that John Merritt, 74, a former Oklahoma City attorney, entered guilty pleas to numerous fraud related offenses in Oklahoma City before Federal District Judge J. Thomas Marten, Wichita, Kansas. According to documents filed in the three separate cases, Merritt had devised fraud schemes that resulted in losses totaling more than $3 million.
Danny C. Williams, Sr., United States Attorney for the Northern District of Oklahoma, was appointed by the Office of the Deputy Attorney General following the recusal of the United States Attorney's Office for the Western District of Oklahoma to investigate and prosecute any offenses that Merritt is believed to have committed. Merritt was indicted on April 17, 2012, in a twelve count indictment charging he used forged federal and state court orders to steal over $450,000 of settlement funds of lawsuits involving car accidents from children who were his clients. Merritt pled guilty to those crimes in July and is awaiting sentencing.
The fraud charges to which Merritt pled guilty yesterday include allegations that: (1) in 2007, Merritt defrauded Advocate Capital, Inc., of Nashville, Tennessee, using false financial statements and income tax returns to fraudulently obtain a line of credit totaling more than $1,750,000; (2) from 2007 through 2011, Merritt defrauded Quail Creek Bank of Oklahoma City, Oklahoma, by providing false financial statements and income tax returns to obtain a line of credit totaling $800,000; and (3) in 2011, Merritt forged the signature of another attorney on two settlement checks totaling $500,000 which he deposited into a Quail Creek Bank account and thereafter withdrew the fraudulently obtained funds.
Sentencing is expected to be set in May 2013.
The charges result from a joint investigation by the Federal Bureau of Investigation and the Internal Revenue Service - Criminal Investigation. The prosecutions of the cases are being handled by Special Attorneys Charles M. McLoughlin and Kevin C. Leitch.
Former Finance Directory Agrees to Plead Guilty to Embezzling More Than $435,000 from the City of CherryvilleRead the Press Release
Another Former City Employee Pleads Guilty to Embezzling Over $92,900
CHARLOTTE, N.C. – A criminal bill of information was filed today in U.S. District Court charging Cherryville’s former Finance Director, Bonny Verley Alexander, with embezzling over $435,000 from the City of Cherryville, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Another former Cherryville employee, Jennifer Neal Hoyle, has also been charged with embezzling over $92,900 from the city.
Alexander, 58, and Hoyle, 34, both of Cherryville, have agreed to plead guilty to the charges stemming from a joint federal and state investigation into misappropriated city funds.
Roger A. Coe, Acting Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Greg McLeod, Director of the State Bureau of Investigation (NC SBI), and Chief James W. Buie of the Gaston County Police Department join U.S. Attorney Tompkins in making today’s announcement.
According to the bill of information and the filed plea agreement, up until her retirement in December 2011, Alexander was employed by the City of Cherryville as its Finance Director and supervised the city’s Finance Department. In that capacity, Alexander oversaw the city’s accounting, financial reporting and treasury divisions, as well as the city’s revenue collections and customer service departments. As the Finance Director, Alexander also had access to and was able to process payroll payments to Cherryville employees, direct payments for city expenses, issue checks on behalf of the city, remove cancelled checks from the city’s records and make adjustments to Cherryville’s electronic accounting systems, court records indicate.
From about August 2005 through December 2011, Alexander embezzled at least $435,294 of Cherryville’s funds and used the money to pay personal expenses. Court documents show that Alexander made weekly payroll payments to herself which were more than 300% of her authorized net pay from the city. In total, Alexander embezzled approximately $309,594 from the City of Cherryville in this manner.
Court records also show that Alexander used city funds to pay for personal expenses, including shopping and travel expenses, she charged on her personal American Express credit card by issuing checks from the City of Cherryville made out to American Express. According to filed documents, Alexander issued the city checks and forged on those checks the signature of another Cherryville employee who was the authorized signatory on the account. Then, to avoid detection, after the forged checks had cleared and were returned by the bank, Alexander would remove them from the city’s records, court documents show. Alexander issued and forged a total of 26 checks from the City of Cherryville totaling approximately $97,000 to pay off personal charges on her American Express card.
Hoyle, a former Senior Customer Service Representative/Utility Supervisor for the City of Cherryville, has been charged with and has agreed to plead guilty to three counts of federal program fraud for embezzling approximately $92,922 from the City of Cherryville. According to the federal charging document and the filed plea agreement, Hoyle was responsible for the collection and posting of utility payments made by Cherryville utilities customers. Hoyle, who reported to Alexander, was terminated in May 2012.
According to filed court documents, beginning in January 2008 through May 2011 Hoyle embezzled approximately $92,922 from the City of Cherryville by taking cash payments made by customers paying their utilities bills for her own use. Court records show that Hoyle would accept the cash payments from the customers and issue paper receipts. Hoyle would credit the customers’ accounts with the payment, keep the cash, and then, using her supervisory override privileges, would go in the computer system and delete the transaction, court records show. Court records also show that, in order to avoid any potential customer complaints, Hoyle would create entries in the “extra charge” journal in which she would “write off” the cash amount the customers paid so that bills containing the embezzled amount would not be issued, records show. According to the bill of information, Hoyle’s fraud was uncovered when a customer questioned the duplicate charges on her bill and brought in her paper receipt as proof of payment, after Hoyle had failed to convert the customer’s cash payment as a “write off” in the “extra charge” journal.
Alexander is charged five counts of program embezzlement. She has agreed to plead guilty to the charges and faces a maximum term of 10 years in prison and a $250,000 fine per count. Hoyle has agreed to plead guilty to three counts of program fraud. She faces a maximum prison term of 10 years and a $250,000 fine per count. The defendants’ initial appearances and plea hearings will be scheduled by the U.S. District Court.
The investigation into Alexander was handled by the FBI and SBI. The investigation into Hoyle was handled by the FBI, SBI and the Gaston County Police Department. The prosecution is handled by Michael Savage, of the U.S. Attorney’s Office in Charlotte.
Former FEMA Executive Pleads Guilty to Federal Conflict of Interest Charge-Defendant Sought Job from Company That Did Work for FEMA-Read the Press Release
WASHINGTON – Timothy W. Cannon, 63, the former director of human resources at the Federal Emergency Management Agency (FEMA), pleaded guilty today to a charge of conflict of interest for negotiating employment with a polling and consulting services company that had a multimillion-dollar contract with FEMA, supervised by Cannon.
The plea occurred before the Honorable Amy Berman Jackson, of the U.S. District Court for the District of Columbia. Sentencing is scheduled for April 9, 2013. The charge carries a statutory maximum of five years in prison.
The guilty plea was announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; Assistant Attorney General Lanny A. Breuer of the U.S. Department of Justice’s Criminal Division; Debra Evans Smith, Acting Assistant Director in Charge of the FBI’s Washington Field Office; Christopher Cherry, Special Agent in Charge of the General Services Administration Office of Inspector General for the National Capital Region, and Mike Dawson, Special Agent in Charge of the U.S. Department of Homeland Security Office of Inspector General’s Washington Field Office.
According to the government’s evidence, from July 2007 through February 2009, Cannon was the director of FEMA’s Human Capital Division. In 2007, Cannon had discussions with a firm, identified in court papers as “Company A,” about FEMA hiring the firm to provide consulting services on human resources matters at FEMA. The work would be done through a project that would eventually be called the “BEST Workforce Initiative.”
In March 2008, the Chief Executive Officer of Company A emailed another Company A employee, stating Cannon “said he has done everything to get a job at [Company A] because he believes so much in our products . . . said he wants to do a real good job at FEMA and that mabye [sic] he would try again . . . .” On April 22, 2008, Company A’s CEO emailed another Company A employee that “. . . [I]f [CANNON] gets us a big deal at FEMA . . . i [sic] think we should hire him . . . because he will be a ‘client’ hire . . . which might be good[.]” Later in the same email chain, Company A’s CEO asked, “[I]s the ink dry yet on our deal with fema [sic] [?]” The Company A employee replied, “[N]o might be mid-May.” Company A’s CEO then stated, “[W]e should wait of course to see if we win a big quality deal here[.]”
On Aug. 12, 2008, Company A was hired to administer the BEST Workforce Initiative at FEMA. The contract was valued at approximately $6 million over five years.
On Nov. 18, 2008, a Company A employee advised Company A’s CEO in an email, “I talked to Tim today. He asked for a job.” Company A’s CEO then stated, “What about ethics . . . are we okay with all of that . . . he is a significant client . . . am sure you know the rules . . . gee he seems like a winner to me . . . I don't think these guys are as expensive as one might think . . . and he has a military background[.]”
In December 2008 and January 2009, Cannon requested additional funding for the BEST Workforce Initiative. On Jan. 6, 2009, in an email to a Company A employee, Cannon stated, “. . . [A]h yes, I got another 500k put on the contract. Cool huh?”
On Jan. 12, 2009, Cannon had an employment interview with Company A in Washington, D.C. On Feb. 9, 2009, Company A sent an employment offer letter by email to Cannon. The letter offered Cannon “the opportunity to join [Company A] as a Partner with our Government Division in Washington, D.C.[,]” and guaranteed him a minimum annual salary of $175,000 for the first two years of employment. Cannon responded to the email the same day, stating, “I am very excited about joining [Company A] and I look forward to working with you . . . .” Following Cannon’s acceptance of Company A’s employment offer, Cannon continued to oversee and work on the BEST Workforce Initiative at FEMA.
Cannon retired from FEMA effective on Feb. 27, 2009. On his Public Financial Disclosure Report, known as a Form SF-278, Cannon indicated that he did not have any agreements or arrangements for “future employment” and he specifically did not list his future employment with Company A. On Feb. 27, 2009, Cannon requested that Company A provide him with an offer letter dated after Feb. 27, 2009, so that it would falsely appear that Cannon received Company A’s employment offer after he had resigned from FEMA. On March 2, 2009, Company A sent an updated version of the offer letter, with the new date of March 2, 2009, to Cannon. Cannon signed this updated version of the offer letter on March 3, 2009, and returned it to Company A.
In March 2009, a Company A employee voiced concerns internally about Cannon’s hiring. In addition, on March 25, 2009, a Company A employee stated in an email to another Company A employee, “Well, I just got a call from and am getting more red flags about Tim Cannon. Apparently, word is getting around about his departure and joining [Company A]. There is speculation among is [sic] co-workers that this is improper. They are pretty mad. This may get in the way of future business with FEMA. . . . This, plus the bankruptcy, plus appearance of ethics violations, both on [Company A] and FEMA side. This is not good. . . . I think we are getting too many sign[s], and I do not think this will work.” On March 26, 2009, Company A informed Cannon that Company A’s offer of employment was being withdrawn. Company A told Cannon that he did not meet the background check requirements.
Later, on Sept. 17, 2009, Cannon sent an email to Company A’s CEO advising that Cannon had joined a consulting firm and asking to have lunch. Company A’s CEO forwarded that email to other Company A employees stating, “This is a guy that was our sponsor at FEMA . . . he is so [Company A] gung ho . . . when he was applying we broke some of the rules of the US Gov on the 'how' we do it . . . so we had to let him go . . . .”
In announcing the guilty plea, U.S. Attorney Machen, Assistant Attorney General Breuer, Acting Assistant Director in Charge Smith, Special Agent in Charge Cherry, and Special Agent in Charge Dawson commended the outstanding investigative work of agents of the FBI’s Washington Field Office, Assistant Special Agent in Charge Floyd Martinez of the GSA OIG, and agents of the DHS OIG, as well as agents and auditors of other federal investigative agencies that assisted with this case. They also praised the efforts of members of the U.S. Attorney’s Office and the Criminal Division Fraud Section, including Paralegal Specialists Diane Hayes and Nicole Wattelet; Legal Assistant Jamasee Lucas; Information Technology Specialist Joshua Ellen; forensic accountants in the Fraud and Public Corruption Section; and Assistant U.S. Attorney David Johnson, Trial Attorney Brian Young, and former Trial Attorney James Graham, who have prosecuted the case.
13-009Former Des Moines, Washington Resident Sentenced to 32 Years in Prison for Attack on Guard at Federal Detention CenterRead the Press Release
A 22-year-old Des Moines, Washington man will spend 32 years in prison for the January 2012 beating of a prison guard, and for the forced labor of two juveniles in the sex trades, announced U.S. Attorney Jenny A. Durkan. SABIR SHABAZZ was in federal custody for sex trafficking two 13-year-old girls, when on January 3, 2012 he and another inmate assaulted a guard at the Federal Detention Center at SeaTac. SHABAZZ beat the guard with a pipe. The men claimed the attack was an escape attempt, but video of the assault shows it was just a brutal attack. Other inmates intervened in the assault, likely saving the guard’s life. At sentencing U.S. District Judge James L. Robart said the attack was carefully planned… “the blows were done to injure.“
“This brutal assault on a prison guard rightfully earned this defendant a lengthy term behind bars,” said U.S. Attorney Jenny A. Durkan. “He preyed on vulnerable 13-year-old girls while on the streets and viciously attacked one of the people we trust to keep our prisons and communities safe and secure. This conduct will not be tolerated.”
According to records filed in the case, in September 2010, SHABAZZ was arrested in connection with the sex trafficking of two 13-year-old girls. SHABAZZ posted ads featuring the girls on backpage.com and with a co-conspirator took the earnings the young girls made in the sex trades. SHABAZZ was being held on the sex trafficking charges when he assaulted the guard at the federal detention center. The guard suffered significant head wounds, which were nearly fatal. He has required surgery and significant rehabilitation. He likely will never be able to return to work as a prison guard.
In their sentencing memo prosecutors wrote, “It is hard to imagine a worse set of offenses - an assault calculated at killing a defenseless jail guard and involvement in the commercial sexual exploitation of two 13 year old girls…. Both girls were runaways and looking for shelter. Unfortunately, they sought help from two people, including SHABAZZ, who viewed the two girls as tools to make money without regard for their well being.”
The Tacoma Police Department and the FBI’s Innocence Lost Task Force investigated the sex trafficking case; the FBI and Federal Bureau of Prisons (BOP) and the Washington State Patrol Crime Scene Response Team (CSRT) investigated the prison assault. The cases against SHABAZZ are being prosecuted by Assistant United States Attorneys Bruce Miyake and Mike Lang.
Former Alabama Corrections Officer Pleads Guilty to Civil Rights Violations and Obstruction of JusticeRead the Press Release
Today, Matthew E. Davidson, a former corrections officer of the Alabama Department of Corrections, pleaded guilty in U.S. District Court in Montgomery, Ala., to two counts of violating the civil rights of a former inmate at Ventress Correctional Facility in Clayton, Ala., and to one count of conspiring with other corrections officers to obstruct justice by covering up the incident.
Davidson was charged by a grand jury on March 8, 2012, with two counts of felony civil rights violations, four counts of obstruction of justice-related violations and one count of making false statements . These charges stem from an incident that occurred at the Ventress prison on Aug. 4, 2010, when an inmate, 24-year-old Rocrast Mack, was severely beaten, suffered significant injuries and died the following day in a Montgomery hospital.
According to court documents, Davidson admitted that he tackled Mack on the prison yard and punched Mack in the head and upper torso area several times. After this beating on the prison yard, Davidson and former corrections officer Scottie Glenn, who pleaded guilty to similar charges in November 2011, escorted Mack in handcuffs to an office at the prison, knowing that Mack would be beaten again.
According to court documents, Davidson admitted that once the officers were inside the office, they were instructed by a supervisor to remove the handcuffs. After Davidson removed the handcuffs, the supervisor repeatedly stomped on, kicked, hit and struck Mack with a baton. Davidson also admitted that another officer struck Mack with a baton. Mack was severely injured as a result of this beating and was taken to the health care unit in the prison. Once there, Mack was pulled off the examination table by his handcuffs and repeatedly stomped on by the supervisor. Davidson further admitted that he and the other officers obeyed directions from the supervisor to lie in written reports and lie to investigators to cover up the beatings.
Davidson faces a maximum penalty of 20 years in prison on the civil rights violations and a maximum penalty of 20 years in prison on the obstruction of justice related violation when he is sentenced before U.S. District Court Judge Myron H. Thompson.
“Mr. Davidson admitted that he participated in, and attempted to cover up, the brutal and ultimately fatal assaults of Rocrast Mack,” said Assistant Attorney General Perez. “The Justice Department will continue to vigorously prosecute corrections officers who violate the constitutional rights of inmates, and who then use their official position to try to cover up their crimes.”
On March 8, 2012, former corrections officers Michael Smith and Joseph Sanders were also charged with felony civil rights violations, obstruction of justice-related violations and false statements violations. Their trial is scheduled to begin on June 10, 2013. Assistant Attorney General Perez and U.S. Attorney Beck emphasized that an indictment is merely an accusation, and the defendants are presumed innocent until proven guilty.
This case is being prosecuted by Trial Attorney Patricia Sumner of the U.S. Department of Justice’s Civil Rights Division and Assistant U.S. Attorney Jerusha Adams of the U.S. Attorney’s Office for the Middle District of Alabama.
Floridian Sentenced to 7 Years in Prison for Orlando-to-New Castle Prescription Pill RingRead the Press Release
PITTSBURGH - A resident of Jupiter, Fla., has been sentenced in federal court to seven years and three months incarceration on his conviction of one count of conspiracy to distribute narcotics, United States Attorney David J. Hickton announced today.
United States District Judge Arthur J. Schwab imposed the sentence on Larry James Dorsey, 34, formerly a resident of New Castle, Pa.
According to evidence presented to the court, Dorsey transported more than 40,000 oxycodone pills that he purchased for $9 each on the black market from the Orlando, Fla., area to drug dealers in the New Castle area, between 2008 and 2011. Those dealers then sold the oxycodone to drug abusers for $20-25 per pill. Oxycodone is a Schedule II narcotic that is classified as having "a high potential for abuse." Popularly called "hillbilly heroin," oxycodone is sold illegally and abused in many states in the Northeast, Midwest and South.
Dorsey found profit in his drug business. In February 2010, $109,000 in cash was seized from Dorsey by agents at the Pittsburgh International Airport, as he prepared to board a flight for Orlando. In September 2010, police in North Carolina intercepted a car from New Castle bound for Orlando, and discovered hidden in a door panel $158,000 in cash, destined for Dorsey. Following his indictment in the Western District of Pennsylvania in July 2011, agents seized boxes containing $99,930 and $79,900 from Dorsey's home and his mother's home, both in the Orlando area, and 5,000 oxycodone tablets.
Eight other individuals, all residents of Western Pennsylvania, were named in the indictment with Dorsey, and are awaiting trial.
Assistant United States Attorney Gregory J. Nescott prosecuted this case on behalf of the government.
U.S. Attorney Hickton commended the Drug Enforcement Administration, the New Castle Police and the Pennsylvania State Police for the investigation leading to the successful prosecution of Larry Dorsey.
Five-Year-Sentence for Bomb-Plot Hoaxes Against Ford Federal Bulding and Palisades Nuclear PlantRead the Press Release
GRAND RAPIDS, MICHIGAN – Anthony Mario Fortuna, 36, of Allendale, Michigan, was sentenced Monday to serve the maximum-authorized penalty of five years in Federal prison for falsely reporting, to the FBI and the U.S. Marshals Service (USMS), plots to bomb the Gerald R. Ford Federal Building, in Grand Rapids, and the Palisades Nuclear Plant, in Covert, Michigan. Fortuna pled guilty to the charge in September, 2012.The sentence was imposed by Chief U.S. District Judge Paul L. Maloney in Kalamazoo, who commented that the maximum sentence was necessary based on Fortuna’s prior criminal history, which included a 2000 Federal conviction in Alabama for lying to the FBI about a murder-for-hire plot, and because the false reports required both the FBI and the USMS to waste time and resources conducting extensive investigations of what, if true, would have been extremely serious plots.
Commenting on the sentence, U.S. Attorney Patrick A. Miles Jr. stated, “Falsely reporting a serious crime to Federal law-enforcement agencies is itself a serious crime because it wastes the limited resources of agencies such as the FBI and of my Office. Time spent running down false leads is time that cannot be spent pursuing genuine crime. For that reason, there is nothing harmless or funny about hoaxes such as those perpetrated by Mr. Fortuna, and people who engage in them will be treated sternly.”
Fortuna perpetrated the first hoax in February 2010, when he reported a fictitious plot by several others to blow up the Ford Building in retaliation for a Federal prosecution that was, in fact, ongoing at the time. Joint investigation by the FBI and USMS established that Fortuna’s story was a hoax. Four months later, however, Fortuna again contacted the FBI with another false report, this time involving an insider plot against the Palisades plant. After a second investigation by the FBI determined that this story was also untrue, Fortuna was indicted on two counts of making false statements to Federal agents. Although the second charge involving the Palisades facility was dismissed as part of his plea-agreement with the Justice Department, Fortuna admitted that he committed both offenses, and explained that he was motivated by a desire to gain favor with the FBI in the hope that doing so would limit his punishment in State of Michigan prosecutions that were then ongoing. U.S. District Judge Maloney was able to consider all of the conduct in selecting a sentence..
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Final Defendant in Detroit Drug Conspiracy Case Sentenced to Lengthy Prison TermRead the Press Release
The final defendant in a Detroit narcotics conspiracy was sentenced today to almost ten years in prison, U.S. Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Special Agent in Charge David McCain, Bureau of Alcohol, Tobacco, Firearms and Explosives, Detroit Field Division.
Chief United States District Judge Gerald E. Rosen sentenced Tyrone Wooten, 26, of Detroit, to 114 months in prison. Wooten pleaded guilty in September to Conspiracy To Distribute Controlled Substances. Wooten was charged as one of the co-leaders of the drug conspiracy. The indictment charged seven defendants with participating in the conspiracy to distribute at least 280 grams of crack cocaine and more than a kilogram of heroin.During the investigation, a search warrant at a Detroit home uncovered 79 grams of crack cocaine and 15 grams of heroin, along with packaging materials and other narcotics paraphernalia.
In addition to Wooten, each of the charged defendants pleaded guilty to narcotics charges and were sentenced as follows; Stefan Toliver, 100 months; George Wooten: 60 months; Rashawn Marcel Jones: 180 months; Ryan Terrel Jones: 49 months; Jabron Poydras: 32 months and Maurice Curry: 168 months.
“We are focusing our drug enforcement efforts on drug trafficking organizations, which can lead to violence in our neighborhoods,” McQuade said. “We hope that prosecutions like this one can improve public safety for residents in our community.”
U.S. Attorney McQuade thanked the ATF for their work in the successful investigation of the case. The case was prosecuted by Assistant United States Attorney Susan Gillooly.Federal Inmate Charged with Possessing Heroin and MarijuanaRead the Press Release
JOHNSTOWN, Pa. - An inmate at FCI Loretto, Pa., has been indicted by a federal grand jury in Johnstown on a charge of possession of contraband in prison, United States Attorney David J. Hickton announced today.
The one-count indictment named Lonnie Johnston, 31, as the sole defendant.
According to the indictment, on Oct. 31, 2012, inmate Johnston possessed heroin and marijuana.
The law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.
The Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Special Investigative Staff at the Federal Correctional Institution at Loretto conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Federal Court Permanently Bars San Antonio Tax Preparers from Preparing Tax ReturnsRead the Press Release
A federal court has permanently barred Pete Escalante Gutierrez and Jeanette Gutierrez from preparing federal tax returns for others, the Justice Department announced today. The civil injunction order, to which the Gutierrezes consented without admitting the allegations against them, was signed yesterday by Judge Orlando L. Garcia of the U.S. District Court for the Western District of Texas. The injunction permits their companies, FCRE Inc., Fast Cash Refund Express Electronic Tax Service LLC, Fast Cash Refund Express and Fast Cash Express Electronic Services, to continue to operate, though the Gutierrezes must sell their interests in these businesses and take no role other than administrative matters until they are sold. While the companies operate, they are permanently barred from promoting any false tax schemes and from advising or encouraging taxpayers to attempt to evade their correct federal tax liabilities. Each of the businesses and the Gutierrezes must turn over the names of the people for whom they prepared tax returns or claimed tax refunds since Jan. 1, 2012.
The government’s complaint alleged that Pete and Jeannette Gutierrez, through their companies, which have offices in San Antonio, prepared federal tax returns for customers that claimed false and exaggerated personal deductions, business deductions, educational and energy tax credits, and other tax credits to which their clients were not entitled, in order to unlawfully understate tax liabilities. As alleged in the complaint, the amount of tax loss resulting from these improper tax preparation activities likely exceeds $3 million for the years 2006 through 2010.
The IRS lists tax-preparer fraud as one of the “Dirty Dozen” tax scams. The Justice Department has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters in the past decade. Information about these cases is available on the Justice Department website.
Related Materials:
United States v. FCRE, Inc., et al.
Complaint for Permanent Injunction and Other Relief (PDF)
Stipulated Order of Permanent Injunction (PDF)
Eleven Defendants Indicted for Alleged Roles in Scheme <br /> to Fraudulently Control Homeowners’ Associations in Las VegasRead the Press Release
WASHINGTON – A federal grand jury in Nevada today returned an indictment against 11 individuals for their alleged roles in a scheme to fraudulently take control of homeowners’ associations in the Las Vegas area. The indictment was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, Acting FBI Special Agent in Charge William C. Woerner of the Las Vegas Field Office, Sheriff Douglas C. Gillespie of the Las Vegas Metropolitan Police Department and Richard Weber, Chief of IRS-Criminal Investigation (IRS-CI).
The charged defendants, all from the Las Vegas area, include: Jose Luis Alvarez, 45; Rodolfo Alvarez-Rodriguez, 44; Ricky Anderson, 49; David Ball, 44; Leon Benzer, 46; Edith Gillespie, 51; Keith Gregory, 59; Maria Limon, 45; Barry Levinson, 45; Charles McChesney, 47; and Salvatore Ruvolo, 84. Each is indicted on one count of conspiracy to commit mail and wire fraud. Most of the defendants are also variously charged with individual counts of mail fraud and/or wire fraud. Limon is additionally charged with making a false statement to law enforcement.
According to court documents, the fraud scheme operated from approximately August 2003 through February 2009 to direct construction defect litigation and repairs at condominium complexes to a particular, conspiring law firm and Benzer’s construction company, Silver Lining Construction (SLC).
In order to accomplish the scheme, according to the indictment, Benzer and co-conspirators identified homeowners’ associations (HOAs) that could potentially bring construction defect cases. They then allegedly enlisted real estate agents to identify condominium units within the HOA communities for purchase.
According to court documents, Benzer and others, including Gillespie, then enlisted “straw purchasers” to use their names and credit to purchase condos in the complexes. The indictment alleges that Alvarez, Alvarez-Rodriguez, Anderson, Ball, Gillespie, Limon, McChesney and Ruvolo acted as straw purchasers. On at least 37 occasions, Benzer and certain co-conspirators allegedly provided the down payments and monthly payments on behalf of the straw purchasers, including HOA dues and mortgage payments, and various false and misleading statements were made to secure financing for the properties. To manage the properties, Benzer and others allegedly conspired to open at least five bank accounts through which they moved more than $8 million. Eventually, 33 of the 37 units went into foreclosure.
According to court documents, on several occasions and at the direction of Benzer, co-conspirators transferred a partial interest in particular condominiums to other co-conspirators to make them look like homeowners who could stand for election to the HOA board of directors, which many of these individuals and the straw purchasers agreed to do. To ensure conspirators won the elections, according to the indictment, the defendants employed deceitful tactics, such as submitting fake and forged ballots, some of which were sent through the U.S. mail. Co-conspirators also hired complicit attorneys to run the HOA board elections as “special election masters,” to preside over the HOA board elections and supervise the counting of ballots.
Once elected, according to the indictment, the conspiring board members met with Benzer and other co-conspirators in order to manipulate board votes and process, including the selection of property managers, contractors, general counsel and attorneys to represent the HOA – including Benzer’s construction company and the conspiring law firm. Gregory and Levinson, both attorneys licensed in Nevada, allegedly agreed to become the general counsel for the Vistana and Sunset Cliffs; and Park Avenue and Pebble Creek complexes, respectively.
Limon, Benzer and others also allegedly agreed to open a property management company in order to provide services at Chateau Nouveau and other condo complexes in furtherance of the scheme. According to the indictment, Limon falsely told law enforcement officials she did not communicate with Benzer about this and did not know he funded and controlled her company.
At the conclusion of the scheme, millions of dollars of Vistana’s construction defect settlement proceeds were transferred to Benzer and SLC, according to the indictment.
According to court documents, the defendants were each given cash or things of value from Benzer and others for their alleged roles in the conspiracy.The maximum potential penalty for each count of conspiracy to commit mail fraud and wire fraud, mail fraud, or wire fraud is 30 years in prison and a $1 million fine. The maximum potential penalty for making a false official statement is five years in prison and a $250,000 fine.
The charges and allegations against the indicted defendants are merely accusations, and the defendants are considered innocent unless and until proven guilty. Twenty-six other individuals have entered guilty pleas in this case and await sentencing. The investigation is ongoing.
The case is being prosecuted by Deputy Chief Charles La Bella, Trial Attorneys Thomas B.W. Hall and Mary Ann McCarthy and Senior Deputy Chief Kathleen McGovern of the Criminal Division’s Fraud Section. The case is being investigated by the FBI, the Las Vegas Metropolitan Police Department, Criminal Intelligence Section, and IRS-CI.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov.
Related Materials:
Benzer Indictment
Drug Trafficker Pleads Guilty to Conspiracy to Launder Drug Proceeds, Distribution of CocaineRead the Press Release
More than $4M in Cash, 89 Kilograms of Cocaine Seized from Organization
CAMDEN, N.J. – A California man today admitted his role in a drug trafficking organization from which the government has seized $4.6 million and intercepted 89 kilograms of cocaine, U.S. Attorney Paul J. Fishman announced.
Edgar Bracamonte, 39, of California, pleaded guilty before U.S. District Judge Renée Marie Bumb in Camden federal court to an Information charging him with one count of conspiracy to distribute 50 to 150 kilograms of cocaine and with one count of conspiracy to launder narcotics proceeds, U.S. Attorney Fishman announced.
According to documents filed in this case and related cases, and statements made in court:Bracamonte was a member of a sophisticated drug trafficking organization (DTO) that was responsible for transporting cocaine from California to New Jersey and elsewhere. In an effort to avoid detection from law enforcement, the cocaine was transported in secret compartments of tractor trailers, including in gas tanks. Once in New Jersey, the cocaine was stored in a warehouse in Passaic County and in “stash houses.” The narcotics proceeds, too, were funneled from New Jersey back to California in hidden compartments of tractor trailers.
From February 2011 through November 2011, law enforcement seized $4.6 million and 89 kilograms of cocaine from the DTO. Fifteen people connected with the DTO have been charged by the U.S. Attorney’s Office, of whom 13 have entered guilty pleas to either conspiracy to distribute narcotics and/or conspiracy to launder money.
The conspiracy to distribute narcotics count to which Bracamonte pleaded guilty is punishable by a mandatory minimum of 10 years in prison, a maximum of life in prison and a fine of $10 million. The conspiracy to launder money count is punishable by a maximum potential penalty of 20 years in prison and a $500,000 fine, or twice the value of the property involved in the transaction, whichever is greater. Sentencing is scheduled for April 26, 2013.
U.S. Attorney Fishman credited special agents and task force officers of the Drug Enforcement Administration, under the direction of Acting Special Agent in Charge Robert G. Koval, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney José R. Almonte of the U.S. Attorney’s Office Narcotics/OCDETF Unit in Newark.
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Defense counsel: Angel Navarro Esq., Los Angeles, Calif.
Bracamonte, Edgar Information
District Man Pleads Guilty to Second-Degree Murder While Armed in 2012 Shooting in Northeast Washington-Defendant Also Pleads Guilty to Shooting at Second Victim in the Attack-Read the Press Release
WASHINGTON – Sean Carter, 22, of Washington, D.C., pled guilty today to charges of second-degree murder while armed and assault with intent to kill stemming from a shooting last year in Northeast Washington, U.S. Attorney Ronald C. Machen Jr. announced.
Carter pled guilty in the Superior Court of the District of Columbia. The Honorable Robert E. Morin scheduled sentencing for April 12, 2013. Carter faces up to 45 years in prison.
According to the government’s evidence, on Aug. 23, 2012, at approximately 10:15 p.m., Carter saw Bidley Warren, 22, walking with a teenager on Rhode Island Avenue NE. Carter recognized both of them and went to his nearby home, where he retrieved a gun. Then he hurried toward them in the 1000 block of Rhode Island Avenue.
When Mr. Warren and the teenager saw Carter approaching with the gun, they ran away from him. Carter chased after them and began shooting. Mr. Warren tripped and fell, and the teenager stopped to check on him. Carter, meanwhile, shot again at the teenager, nearly striking him in the head. Due to the assault with gunfire, the teenager was forced to leave Mr. Warren behind and he ran away. Carter then stood over Mr. Warren and shot Mr. Warren in the head. Mr. Warren died soon afterward from the gunshot wound to his head.
After the murder, Carter fled to Atlanta. He was apprehended there by the U.S. Marshals Service on Oct. 2, 2012. The next day, Carter admitted to two detectives with the Metropolitan Police Department (MPD) that he chased and shot at Mr. Warren and the teenager, and that he then shot Mr. Warren in the head while Mr. Warren was on the ground.
In announcing the guilty plea, U.S. Attorney Machen commended the work of the detectives of MPD’s Criminal Investigations Division and the officers of MPD’s Fifth District. He also acknowledged the efforts of the Atlanta Police Department, the U.S. Marshals Service, and the U.S. Attorney’s Office for the Northern District of Georgia. He also expressed appreciation to those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Victim Witness Advocate Marcia Rinker and Paralegal Specialist Marian Russell. Finally, U.S. Attorney Machen praised the work of Assistant U.S. Attorney Shana Fulton of the Homicide Section, who prosecuted the case.
13-010Detroit Man Sentenced to Federal Prison for Heroin PossessionRead the Press Release
HUNTINGTON, W.Va. – U.S. Attorney Booth Goodwin announced today that a Detroit man was sentenced to two years and three months in federal prison for heroin possession. Gerald L. Height, also known as “Tim Lewis,” 37, of Detroit, previously pleaded guilty in September 2012 to possession with intent to distribute heroin.
On March 12, 2012, law enforcement agents with the Huntington Violent Crime and Drug Task Force observed the defendant enter a vehicle at the Greyhound bus station in Huntington. Law enforcement agents were conducting surveillance at the Greyhound location at the time. Officers performed a traffic stop on the vehicle and a Huntington Police Department K-9 gave a positive indication of the presence of drugs. Officers discovered a total of 62 bags of heroin with a weight of 35.5 grams in the defendant’s suitcase. Height admitted to possessing the heroin for distribution.
The Huntington Violent Crime and Drug Task Force, the Huntington Police Department and the Barboursville Police Department conducted the investigation. Assistant United States Attorney Gregory McVey handled the prosecution. The sentence was imposed by United States District Judge Robert C. Chambers
Deported Guatemalan Charged with Illegally Re-entering U.S.Read the Press Release
JOHNSTOWN, Pa. - A citizen of Guatemala, has been indicted by a federal grand jury in Johnstown on a charge of re-entry of an illegal alien, United States Attorney David J. Hickton announced today.
The one-count indictment named Jose Arqimedes Guevera-Amaya, 30, of Altoona, Pa., as the sole defendant.
According to the indictment, on Nov. 19, 2012, Guevera-Amaya, an alien who had been deported from the United States on Oct. 11, 2001, was found in Blair County, Pennsylvania. He had unlawfully re-entered this country without receiving permission from the Attorney General of the United States or the Secretary of the Department of Homeland Security to do so.
The law provides for a maximum total sentence of two years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney John J. Valkovci, Jr., is prosecuting this case on behalf of the government.
The Department of Homeland Security/Immigration and Customs Enforcement conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Colorado Resident Sentenced to 168 Months in Prison for Defrauding Investors in Texas Real Estate SchemeRead the Press Release
WASHINGTON – The owner and president of Evans Real Estate Group LLC was sentenced today to 168 months in prison for defrauding investors in real estate funds that invested in the acquisition, renovation and continued operation of existing apartment complexes in Texas, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
Thomas B. Evans, 48, of Centennial, Colo. – a property manager and organizer of real estate investment funds – was sentenced today by U.S. District Judge Christine M. Arguello in Denver. In addition to his prison term, Evans was sentenced to serve five years of supervised release and ordered to pay $12,339,038.53 in restitution.
On Jan. 20, 2012, Evans pleaded guilty to one count of conspiracy to commit mail and wire fraud. According to plea documents, from at least April 2005 until April 2007, Evans and a co-conspirator engaged in a scheme to defraud investors in the Garden Stone Apartments LP; Ventana Apartments LP; and Aspen Chase Investments LP real estate investment funds, which invested in existing apartment complexes in Austin, Dallas and San Antonio, Texas. The complexes were to be sold for a profit when renovation was complete.
According to court documents, Evans and a co-conspirator misappropriated project funds; prepared monthly false financial statements for the projects that were sent to investors, banks and other lending institutions; prepared quarterly letters to investors misrepresenting the progress of apartment renovations and occupancy rates; and prepared falsified rent rolls to banks and lending institutions. When a receiver assumed operation of the properties in April 2007, Evans and his co-conspirator provided access to their electronic accounting system without informing the receiver that the system contained falsified information. Investors in Evans’ real estate ventures lost over $12 million.
The case is being prosecuted by Trial Attorney Fred Medick of the Criminal Division’s Fraud Section and investigated by the U.S. Postal Inspection Service.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov.
Charlotte Woman Sentenced to 24 Months in Prison for Tax and Mortgage FraudRead the Press Release
CHARLOTTE, N.C. – On Tuesday, January 14, 2014, Chief U.S. District Judge Frank D. Whitney sentenced a Charlotte woman to 24 months in prison for committing tax fraud and mortgage fraud, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. Tega Burns, 41, of Charlotte, was also ordered to serve two years under court supervision following her prison term and to pay $201,039.43 in restitution to IRS, $57,450.00 in restitution to Bank of America, and $48,483.00 in restitution to CIT Group Consumer Finance.
U.S. Attorney Tompkins is joined in making today’s announcement by Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service - Criminal Investigation Division (IRS-CID).
Burns, a/k/a Tega Foy, was the owner of Family Homecare Services, a Charlotte-based company that provided in-home care services in the area from 2007 through 2011. According to filed court documents and yesterday’s sentencing hearing, Burns failed to pay a large part of the employment taxes her company owed for the relevant tax years. Specifically, court records show that during the relevant time period, Burns had an outstanding liability of more than $200,000 relative to the employment taxes. According to statements made during sentencing, Burns utilized nominees, including her son and her step-father, to hide funds from the IRS and to evade payment of the outstanding taxes.
Court records also show that in May 2007, Burns obtained mortgage loans using false information – including fake employment documentation from her company – to purchase two homes in the name of another individual. Both of these homes were eventually foreclosed on, with losses to the banks.
In July 2012, Burns pleaded guilty to one count of failure to account for and pay over employment tax and one count of making a false statement on a loan application.
Burns will be ordered to begin her prison sentence and be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility. Federal sentences are served without the possibility of parole.
The investigation was conducted by IRS-CI. The case is being prosecuted by Assistant U.S. Attorney Jenny Grus Sugar of the U.S. Attorney’s Office in Charlotte.
Career Drug Offender Sentenced to 30 Years in Federal PrisonRead the Press Release
Tampa, FL - U.S. District Judge James Whittemore sentenced Anton Hernandez (32, Tampa) yesterday to 30 years in federal prison for possessing with intent to distribute 28 grams or more of crack cocaine. A federal jury found Hernandez guilty on September 13, 2012.
According to court documents and facts revealed at trial, on September 6, 2009, Hernandez delivered crack cocaine to undercover Hillsborough County Sheriff's Deputies. Hernandez had brought his then five-year old child with him to the drug deal. Hernandez was arrested on state narcotics charges. While out on bond, on December 21, 2009, Hernandez delivered additional crack cocaine to undercover HCSO Deputies. Hernandez then became a fugitive for almost two years. On August 5, 2011, HCSO Deputies tracked Hernandez down and caught him with an additional 36.1 grams of crack cocaine. At the time of his arrest, Hernandez had twenty-one prior criminal convictions, including five cocaine delivery-related felonies.
This case was investigated by the Hillsborough County Sheriff's Office. It was prosecuted by Assistant United States Attorney Thomas N. Palermo.
California Woman Sentenced for Bank Fraud and Identity TheftRead the Press Release
ROCHESTER, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Cassandra Montrevel, 26, of Sacramento, CA, who was convicted of conspiracy to commit bank fraud and aggravated identity theft, was sentenced to 70 months in prison and ordered to pay restitution in the amount of $326,00 by U.S. District Judge David G. Larimer.
Assistant U.S. Attorney Tiffany H. Lee, who is handled the case, stated that the defendant conspired with others to execute a scheme to defraud Bank of America by flying to different branches across the country, posing as actual bank account holders, and attempting to make cash withdrawals. Montrevel flew into the Western District of New York in March 2011. On March 18, 2011, the defendant went to Bank of America branches in Irondequoit, Gates and Batavia and attempted to withdraw money from the account of a Texas resident by presenting a fake Texas driver's license using the name of the actual account holder. Montrevel also presented the correct social security number of the true account holder. She admitted to having executed the scheme in Florida, Georgia, Tennessee, Illinois and New York as well.
The sentencing is the culmination of an investigation on the part of the United States Secret Service, under the direction of Special Agent in Charge Tracy Gast, the Monroe County Sheriff's Office, under the direction of Sheriff Patrick O'Flynn, the Gates Police Department, under the direction of Chief David DiCaro, the Irondequoit Police Department, under the direction of Chief Richard Boyan, and the Batavia Police Department under the direction of Chief Shawn Heubusch.
California Tax Return Preparer Pleads Guilty to Tax Refund ConspiracyRead the Press Release
Masood Chotani, a CPA and tax return preparer from Los Angeles County, Calif., pleaded guilty today to conspiracy to defraud the United States, the Justice Department and Internal Revenue Service (IRS) announced.
On June 23, 2010, Chotani was indicted by a federal grand jury in Riverside, Calif., on charges of engaging in a scheme to file false returns with the IRS using the names and Social Security numbers of deceased individuals.
According to the indictment and the plea agreement, in 2002 and 2003, Chotani misappropriated employer identification information from his client files and provided the information to his co-conspirator, Haroon Amin. Amin and another co-conspirator, Ather Ali, used the stolen employer data, as well as deceased people’s Social Security numbers and other identification information obtained from the Internet, to prepare and file fraudulent returns. These returns had fictitious Form W-2 wage and tax statements as attachments, falsely stating that the deceased people earned wages from those employers from which income tax had been withheld.
Chotani admitted that he was a knowing participant in this scheme. He also admitted filing similar false returns himself, in his parents’ names, also using employer identification information misappropriated from his files.
According to documents filed in two related cases, the scheme resulted in the filing of over 250 false returns claiming an aggregate of more than $2 million in income tax refunds. Although the IRS rejected the bulk of these refund claims, a number of refund checks were issued and delivered to addresses controlled by Amin, Ali, and their co-conspirators. Most of these refund checks then were delivered overseas to be deposited in bank accounts in Armenia and Pakistan.
Amin pleaded guilty to conspiracy to defraud the United States on Jan. 25, 2010, and is serving a 30-month prison term. Ali subsequently pleaded guilty to the same crimeon Feb. 12, 2010, and is serving a 37-month prison term.
Judge S. James Otero scheduled Chotani’s sentencing for April 22, 2013. Chotani faces a statutory maximum sentence of five years in prison and a maximum fine of $250,000. In addition, under the plea agreement, Chotani has agreed to pay restitution to the IRS for the losses arising from the tax fraud scheme.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, commended the efforts of agents from the IRS Criminal Investigation Division in Laguna Niguel, Calif., as well as Assistant U.S. Attorney Charles E. Pell and Tax Division Trial Attorneys Joseph A. Rillotta and Ignacio Perez de la Cruz, who are prosecuting the case.
More information about the Tax Division and its enforcement efforts is available at www.usdoj.gov/tax .