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Friday 3 January 2025
Justice Department Reaches Agreement with Antioch, California, Police Department Resolving Race Discrimination InvestigationRead the Press Release
The Justice Department announced today an agreement with the Antioch, California, Police Department (APD) and the City of Antioch to resolve an investigation of race discrimination and other discriminatory conduct by APD officers against members of the public in Antioch.
The department launched its investigation after the public disclosure of discriminatory text communications that dozens of APD personnel allegedly exchanged between September 2019 and January 2022. The Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Northern District of California jointly investigated APD’s compliance with Title VI of the Civil Rights Act of 1964 (Title VI) and the nondiscrimination provisions of the Omnibus Crime Control and Safe Streets Act (Safe Streets Act). Title VI and the Safe Streets Act collectively prohibit discrimination on the basis of race, color, national origin, sex and religion by recipients of federal financial assistance, such as APD.
“Fair and non-discriminatory policing is fundamental to effective law enforcement, especially for those agencies that receive federal funding,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “In working with the Justice Department to institute policing reform, Antioch Police Department sends a strong message that the discrimination and misconduct that prompted this investigation will not be tolerated. The agreement we have secured will ensure that Antioch’s policing practices are free from discrimination in the road ahead — the community deserves nothing less.”
“Law enforcement is only effective when it inspires public confidence,” said U.S. Attorney Ismail J. Ramsey for the Northern District of California. “A police department that discriminates based on race and other protected classes undermines both public safety and public confidence. Today’s agreement will help ensure that policing in Antioch is done constitutionally and will help restore public trust.”
In response to the investigation, APD, the City of Antioch and the City Manager worked cooperatively with the department to reach a resolution agreement embodying a commitment to nondiscrimination in APD’s policing operations and advancing its ongoing efforts to prevent and address discriminatory law enforcement practices.
Under the agreement, APD will hire an expert law enforcement consultant jointly selected by the parties to review and update APD’s policies, procedures and training on a variety of topics, including non-discriminatory policing, use of force, hiring and promotions, investigations of misconduct, discipline, community policing, language access, and other topics. The agreement contemplates a role for the Antioch Police Oversight Commission and sets forth a framework for data collection and reporting for a five-year period of departmental monitoring, among other provisions.
Nondiscrimination under Title VI and the Safe Streets Act is a top priority of the Civil Rights Division. Additional information about the Civil Rights Division is available at www.justice.gov/crt. Members of the public may report possible civil rights violations at civilrights.justice.gov/report/.
Justice Department Reaches Agreement with Antioch Police Department Resolving Race Discrimination InvestigationRead the Press Release
OAKLAND — The Justice Department announced today an agreement with the Antioch, California, Police Department (APD) and the City of Antioch to resolve an investigation of race discrimination and other discriminatory conduct by APD officers against members of the public in Antioch.
The department launched its investigation after the public disclosure of discriminatory text communications that dozens of APD personnel allegedly exchanged between September 2019 and January 2022. The U.S. Attorney’s Office and the Justice Department’s Civil Rights Division jointly investigated APD’s compliance with Title VI of the Civil Rights Act of 1964 (Title VI) and the nondiscrimination provisions of the Omnibus Crime Control and Safe Streets Act (Safe Streets Act). Title VI and the Safe Streets Act collectively prohibit discrimination on the basis of race, color, national origin, sex, and religion by recipients of federal financial assistance, such as APD.
“Law enforcement is only effective when it inspires public confidence,” said United States Attorney Ismail J. Ramsey. “A police department that discriminates based on race and other protected classes undermines both public safety and public confidence. Today’s agreement will help ensure that policing in Antioch is done constitutionally and will help restore public trust.”
“Fair and non-discriminatory policing is fundamental to effective law enforcement, especially for those agencies that receive federal funding,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “In working with the Justice Department to institute policing reform, Antioch Police Department sends a strong message that the discrimination and misconduct that prompted this investigation will not be tolerated. The agreement we have secured will ensure that Antioch’s policing practices are free from discrimination in the road ahead — the community deserves nothing less.”
In response to the investigation, APD, the City of Antioch and the City Manager worked cooperatively with the department to reach a resolution agreement embodying a commitment to nondiscrimination in APD’s policing operations and advancing its ongoing efforts to prevent and address discriminatory law enforcement practices.
Under the agreement, APD will hire an expert law enforcement consultant jointly selected by the parties to review and update APD’s policies, procedures, and training on a variety of topics, including non-discriminatory policing, use of force, hiring and promotions, investigations of misconduct, discipline, community policing, language access, and other topics.
The agreement contemplates a role for the Antioch Police Oversight Commission and sets forth a framework for data collection and reporting for a five-year period of departmental monitoring, among other provisions.
Assistant United States Attorney Michael Keough, with the assistance of Jonathan Birch, and attorneys from the Federal Coordination and Compliance Section of the Justice Department’s Civil Rights Division are handling this case.
Members of the public may report possible civil rights violations to this office via our website or at civilrights.justice.gov/report/.
Antioch Agreement
Justice Department Finds State of Oklahoma, Oklahoma City and Oklahoma City Police Department Discriminate Against People with Behavioral Health DisabilitiesRead the Press Release
Note: View Assistant Attorney General Kristen Clarke's remarks here.
The Justice Department announced today that it has reasonable cause to believe that the State of Oklahoma, Oklahoma City and Oklahoma City Police Department (OKCPD) discriminate against people with behavioral health disabilities. Specifically, the department finds that:
- Oklahoma unnecessarily institutionalizes, or puts at serious risk of unnecessary institutionalization, adults with behavioral health disabilities in the Oklahoma County area, in violation of Title II of the Americans with Disabilities Act (ADA);
- Oklahoma City and OKCPD engage in a pattern or practice of conduct that discriminates against people with behavioral health disabilities when providing emergency response services, in violation of Title II of the ADA and the pattern or practice provision of the Violent Crime Control and Law Enforcement Act of 1994.
“People with behavioral health disabilities in the Oklahoma County area are not receiving the support they need,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Instead of accessing treatment in the community, they are institutionalized repeatedly. Further, when they call 911 for a behavioral health emergency, they get a response by armed police, even when there is no public safety issue identified. As a result, urgent mental health needs often go unaddressed and crisis situations are needlessly escalated, sometimes leading to avoidable use of force. We recognize that the state and the city are taking preliminary steps to improve access for and treatment of people with behavioral health disabilities. The Justice Department is committed to working collaboratively with Oklahoma and Oklahoma City so that they implement the right services and supports their communities need and institute a lasting remedial plan.”
The department’s investigation of the State of Oklahoma found that thousands of people with behavioral health disabilities are admitted to psychiatric hospitals in the Oklahoma County area each year, and many have long or repeated stays. Many also have long-term stays in nursing or residential care facilities. Most would prefer to live in their communities, surrounded by friends and family, and to have the freedom to make their own choices about their lives. These individuals could live successfully in their communities if they received critical community-based services that are proven to help people with behavioral health disabilities avoid unnecessary admissions or unnecessarily lengthy stays in segregated institutional settings. But Oklahoma does not provide sufficient services to prevent unnecessary institutionalization. As a result, many people with behavioral health disabilities never receive treatment until they are in crisis, when they instead end up needlessly hospitalized or in contact with law enforcement. For many in the Oklahoma County area, OKCPD is the law enforcement agency they encounter.
The investigation also concluded that when a person calls 911 seeking assistance with a behavioral health issue, the city sends police as the sole responders in most cases. In many cases these calls for assistance could be more effectively resolved by a response by behavioral health professionals who can provide appropriate treatment, but the city rarely involves such professionals. Instead, armed OKCPD officers respond to situations involving behavioral health needs, often failing to help, escalating crises or even unnecessarily using force.
During the department’s investigation, both the state and city initiated improvements to their systems. The state continued to expand its crisis system and released an updated Olmstead plan, and the city announced plans to develop and provide a behavioral health response to 911 calls, and began to make improvements within OKCPD that will help address these violations.
The department will be conducting outreach to members of the Oklahoma community for input on remedies to address the department’s findings. People may also submit recommendations by calling (888) 473-3460 or emailing [email protected].
The department has opened 12 pattern and practice investigations into law enforcement agencies since 2021 pursuant to 34 U.S.C. 12601, and has been actively monitoring over a dozen agreements with law enforcement agencies that were secured prior to that period. Since 2021, the department has successfully concluded agreements and portions of consent decrees with the Yonkers, New York, Police Department; the Albuquerque, New Mexico, Police Department; the Suffolk County, New York, Police Department; the Portland, Oregon, Police Bureau; and the Seattle Police Department. The department has issued findings reports concerning several agencies including: Louisville, Kentucky, Metro Police Department; the Minneapolis Police Department; the Phoenix Police Department; the Lexington, Mississippi, Police Department; the Trenton, New Jersey, Police Department; the Memphis, Tennessee, Police Department; the Worcester, Massachusetts, Police Department; and the Mt. Vernon, New York, Police Department. Investigations are ongoing regarding the Louisiana State Police; the New York City Police Department’s Special Victims Division; and the Rankin County, Mississippi, Sheriff’s Department. The department also reached a court enforceable agreement with Louisville to resolve its findings.
Additional information about the Civil Rights Division is available at www.justice.gov/crt.
The Justice Department will hold a virtual community meeting on Jan. 7 at 6 p.m. CT. Members of the public are encouraged to attend to learn more about the findings. Please register to join the meeting at www.zoomgov.com/webinar/register/WN_lZgzBC4lRJiw7tk3pfEXrw#/registration.
Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned or appeared recently before U.S. Magistrate judges on indictments handed down by the Grand Jury or on criminal complaints. The charging documents are merely accusations and defendants are presumed innocent until proven guilty beyond a reasonable doubt:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan and pleading not guilty on Jan. 2 was:
Jeffrey Thomas Maki, 40, of Billings, on charges of bank fraud and aggravated identity theft. If convicted of the most serious crime, Maki faces a maximum of 30 years in prison, a $1 million fine and five years of supervised release on the bank fraud charge and a mandatory minimum of two years in prison, consecutive to any other sentence, a $250,000 fine and one year of supervised release on the identity theft charge. Maki was detained pending further proceedings. The FBI and Billings Police Department conducted the investigation. PACER case reference. 24-171.
Appearing on Dec. 23, 2024 was:
Ricardo Alberto Salazar Contreras, 33, unknown residence, on charges of possession with intent to distribute controlled substances and possession of a firearm in furtherance of a drug trafficking crime. If convicted of the most serious crime, Contreras faces a mandatory minimum of five years to 40 years in prison, a $5 million fine and at least four years of supervised release on the drug charge and a mandatory minimum of five years to life in prison, consecutive to any other sentence, a $250,000 fine and five years of supervised release on the firearm charge. Contreras was detained pending further proceedings. The Eastern Montana High Intensity Drug Trafficking Area Task Force, FBI and Montana Highway Patrol conducted the investigation. PACER case reference. 24-169.
Appearing in Missoula before U.S. Magistrate Judge Kathleen L. DeSoto and pleading not guilty on Dec. 30, 2024 was:
Felipe Michael Garza, 31, of Washington, on charges of possession with intent to distribute methamphetamine and fentanyl, possession of a firearm in furtherance of a drug trafficking crime and prohibited person in possession of a firearm. If convicted of the most serious crime, Garza faces a mandatory minimum of 10 years to life in prison, a $10 million fine and at least five years of supervised release on the drug charge and a mandatory minimum of five years to life in prison, consecutive to any other sentence, a $250,000 fine and five years of supervised release on the charge of possessing a firearm in furtherance of drug trafficking. Garza was detained pending further proceedings. The Drug Enforcement Administration and Homeland Security Investigations conducted the investigation. PACER case reference. 24-65.
The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Honduran National and Convicted Arsonist Sentenced to Nearly Two Years for Illegally Reentering United StatesRead the Press Release
MOBILE, AL – A Honduran national was sentenced in federal court on December 5, 2024, to twenty-one months in federal prison for being unlawfully in the United States after having been previously removed.
According to court documents, on January 1, 2023, the Robertsdale Police Department arrested Marlon Pineda-Enamorado for arson, first degree.
The United States Immigration and Customs Enforcement (ICE), Enforcement and Removal Operations of Mobile was notified of Pienda’s arrest. ICE officers investigated and determined that Pineda had been previously removed from the United States on two occasions. ICE verified that Pineda did not have any lawful authority to be voluntarily present in the United States when he was arrested by the Robertsdale Police Department for arson-related charges. Pineda was separately convicted in state court for arson first degree, and on November 11, 2024, Pineda was sentenced to 20 years imprisonment by the Baldwin County Circuit Court.
Upon release from imprisonment, Pineda will be delivered to a duly authorized immigration official for deportation proceedings.
U.S. Attorney Sean P. Costello of the Southern District of Alabama made the announcement.United States Immigration and Customs Enforcement, Enforcement and Removal Operations and the Robertsdale Police Department investigated the case.
Assistant U.S. Attorney Justin Kopf prosecuted the case on behalf of the United States.
Hartford Man Who Trafficked Guns and Crack Sentenced to 12 Years in Federal PrisonRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that JACQUERIE LABRONZE GIBSON, also known as “Compton,” 44, of Hartford, was sentenced today by U.S. District Judge Sarala V. Nagala in Hartford to 144 months of imprisonment, followed by three years of supervised release, for trafficking firearms and crack cocaine.
According to court documents and statements made in court, in August 2021, law enforcement received information that Gibson was trafficking firearms that had been purchased by Jacintre Holley, and others on Holley’s behalf, in North Carolina; was distributing narcotics, which he sometimes traded for firearms; and was converting cocaine to crack cocaine at his Wethersfield Avenue apartment in Hartford. On August 12, 2021, investigators executed a court-authorized search warrant at Gibson’s residence and seized a loaded Taurus Model G3 9mm handgun, additional ammunition, a bullet proof vest, approximately 90 grams of crack cocaine, various items used to process and package narcotics, and $860 in cash. Gibson was in the apartment at the time of the search and was arrested.
The investigation revealed that Gibson’s firearm source in North Carolina had sold approximately 15 firearms to Gibson and approximately 50 firearms to another buyer in Connecticut. To date, at least 16 of these trafficked firearms have been recovered from crime scenes in and around Connecticut, including one that was used in homicide in Middletown on May 16, 2021.
Gibson’s criminal history includes felony convictions for drug, burglary, and failure to appear offenses, and a conviction in April 2005 for assault in the first degree stemming from a knife attack of his then girlfriend. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
Gibson has been detained since his arrest. On August 31, 2023, he pleaded guilty to possession with intent to distribute cocaine base (“crack”), and unlawful possession of a firearm by a felon.
On February 23, 2023, Holley was sentenced in the Eastern District of North Carolina to 127 months of imprisonment.
This investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Middletown Police Department, and the Greenville (N.C.) Police Department. The case was prosecuted by Assistant U.S. Attorney John T. Pierpont, Jr.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce gun violence and other violent crime, and to make our neighborhoods safer for everyone. In May 2021, the Justice Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. For more information about Project Safe Neighborhoods, please visit www.justice.gov/psn.
Groton Man Pleads Guilty to Child Exploitation OffenseRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that RYAN CAMERON, 22, of Groton, pleaded guilty today before U.S. District Judge Vernon D. Oliver in Hartford to a child exploitation offense.
According to court documents and statements made in court, in 2023, Cameron was convicted in state court of illegal dissemination of intimate images of a 15-year-old female. In April 2024, while Cameron was on state probation, his probation officer conducted a home visit and discovered Cameron was in possession of a cell phone in violation of the conditions of his probation. Subsequent forensic analysis of the phone revealed that it contained videos of child sexual abuse, and messages between Cameron and others in which Cameron solicited and distributed child pornography. The phone also contained recordings of Cameron sending sexually explicit images and videos of himself to young girls on Snapchat.
Cameron pleaded guilty to receipt of child pornography, an offense that carries a mandatory minimum term of imprisonment of five years and a maximum term of imprisonment of 20 years. Sentencing is scheduled for March 28.
Cameron has been detained since May 20, 2024, when he was arrested on unrelated state charges.
This matter has been investigated by Homeland Security Investigations (HSI) with the assistance of the New Haven Police Department. The case is being prosecuted by Assistant U.S. Attorney Christopher Lembo.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
Government Contractors and Owner Agree to Pay $1 Million to Resolve Allegations of Submitting Fraudulent BidsRead the Press Release
BOSTON – S.A.F.E. Structure Designs, U.S.A. Manufacturing, and their owner, Johnny Buscema, Jr., have agreed to pay $1 million to resolve allegations that they violated the False Claims Act by submitting, or causing the submission of, false claims on a prime vendor contract with the Defense Logistics Agency (DLA), which the Department of Defense (DoD) uses to purchase goods and services.
S.A.F.E. Structure, based in Las Vegas, Nev., sells safety equipment, and USA Manufacturing, based in Port Ritchey, Fla., is a general construction company. Buscema, of Port Richey, owns and operates both companies.
S.A.F.E Structure and USA Manufacturing were vendors to Noble Sales Co., Inc. d/b/a Noble Supply & Logistics (Noble), which is a Boston-based prime contractor to DLA for Maintenance, Repair, and Operations (MRO) contracts for the Northeast and Southeast regions. Under the MRO contracts, the DoD can place orders for goods and services through Noble, and Noble is required to solicit bids from two independently competing vendors for transactions below $25,000, and from three independently competing vendors for transactions at or above $25,000. According to DLA, MRO contracts are “a partnership aimed at achieving infrastructure savings, inventory cost reductions, and favorable product pricing through leveraged buying.”
Pursuant to the settlement agreement, Buscema, S.A.F.E. Structure, and USA Manufacturing admitted that, from 2014 to 2023, they coordinated with Noble or other vendors to submit bids on the MRO contracts. For example, Buscema and his companies admitted that, at Noble’s request, they submitted over 100 bids—which they called “courtesy bids” or “comps”—where Buscema and his companies had no intention of winning the business. For these “courtesy bids” or “comps,” Noble provided Buscema and his companies with the specific prices that Buscema’s companies should bid or a price that the bids should exceed. As a result, vendors other than S.A.F.E. Structure or USA Manufacturing won the business. Buscema also admitted that he paid two other vendors to submit at least 60 “courtesy bids” or “comps,” so that S.A.F.E. Structure or USA Manufacturing won the business. Buscema also admitted that, on occasion, he provided a bid from S.A.F.E Structure and a bid from USA Manufacturing for the same solicitation, even though Buscema owned both companies, and that Noble was aware that Buscema owned both companies. The United States contends that claims under the MRO contracts resulting from these coordinated bids were false under the False Claims Act, and that the DoD paid more under the MRO Contracts as a result.
“As evidenced in this settlement agreement, these contractors gamed the system to line their own pockets. They manipulated and undermined the fair and open bidding process designed to save our military – and taxpayers – money. Contractors should be scrupulous in dealing with the government, not coordinating with each other to pad their bottom line,” said United States Attorney Joshua S. Levy. “When defense contractors collude, rather than compete, they violate the law and the public’s trust.”
“Those who seek to do business with the government are expected to compete fairly and independently to ensure that the government receives an appropriate price,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will hold accountable government contractors that engage in bid rigging or otherwise seek to defraud the American taxpayers.”
“The Department of Defense (DoD) expects its contractors to compete in open and fair markets,” said Patrick J. Hegarty, Special Agent in Charge of the DoD’s Office of Inspector General’s Defense Criminal Investigative Service, Northeast Field Office. “Today’s announcement demonstrates our commitment to work with our law enforcement partners to investigate allegations of anticompetitive practices and ensure the integrity of the DoD’s procurement process.”
“Department of the Army Criminal Investigation Division works diligently to maintain the Army’s readiness and will continue to work closely with our law enforcement partners to prevent and thoroughly investigate fraudulent activity,” said Special Agent in Charge Keith K. Kelly of the Department of the Army Criminal Investigation Division (CID)’s Fraud Field Office. “CID is committed to providing expertise and capabilities supporting whole of government efforts to ensure the U.S. Army remains the most technologically advanced, capable, and ready fighting force in the world.”
“GSA OIG remains committed to working closely with its law enforcement partners to protect American taxpayer dollars and government programs from fraud,” said Special Agent in Charge Joseph Dattoria, U.S. General Services Administration, Office of Inspector General (GDS OIG), Northeast Field Investigations Division.
U.S. Attorney Levy, Deputy AAG Boynton, DCIS SAC Hegarty, ARMY CID SAC Kelly and GSA SAC Dattoria made the announcement. This matter was handled by Assistant U.S. Attorneys Brian LaMacchia and Lindsey Ross for the District of Massachusetts, and Trial Attorney Samson Asiyanbi of the Justice Department’s Civil Division.
Government Contractor Agrees to Pay $1M to Resolve False Claims Act Allegations for Submitting Fraudulent Bids on Prime Vendor ContractsRead the Press Release
Johnny Buscema Jr. of New Port Richey, Florida, and his companies, S.A.F.E. Structure Designs, based in Las Vegas, and U.S.A. Manufacturing, based in New Port Richey, have agreed to pay $1,000,000 to resolve allegations that they violated the False Claims Act by causing a prime vendor for the Defense Logistics Agency (DLA) to submit fraudulent contract bids to DLA that resulted in Department of Defense (DoD) customers being overcharged for goods and related services purchased under those contracts. The settlement is based on the settling parties’ ability to pay.
Buscema owns S.A.F.E. Structure Designs, which sells safety equipment to government customers, and USA Manufacturing, a general construction company. Both companies provide third party logistics support, such as product acquisition, receiving, warehousing, transportation, shipping and returns, to military customers through DLA contracts for Maintenance, Repair and Operations (MRO) for the Northeast and Southeast regions of the United States. The MRO contracts covered by the settlement are held by a “prime vendor,” which procures for DoD agencies supplies and equipment, such as chemicals, electrical supplies, hardware, HVAC/refrigeration, prefabricated structures and a variety of small tools. The goal of the MRO program is to achieve favorable product pricing through leveraged buying, infrastructure savings, and inventory cost reductions. To obtain the best price for items procured for the government, the MRO contracts require the prime vendor to engage in a competitive bidding process, soliciting bids from two independently competing vendors for transactions below $25,000 and from three independently competing vendors for transactions at or above $25,000.
The United States alleged that, from 2016 to 2023, the settling parties conspired with other entities to rig bids for awards on the MRO contracts for the Northeast and Southeast regions of the United States. More specifically, Buscema allegedly submitted non-competitive bids, paid other vendors to submit non-competitive bids and submitted multiple bids from his own two companies on the same solicitations to assist the prime vendor to meet its obligation to obtain bids from two or three vendors and to make one of the bids appear more competitive. As a result of these alleged schemes, the United States contends it was overcharged for items purchased under the MRO contracts.
“Those who seek to do business with the government are expected to compete fairly and independently to ensure that the government receives an appropriate price,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will hold accountable government contractors that engage in bid rigging or otherwise seek to defraud the American taxpayers.”
“As evidenced in this settlement agreement, these contractors gamed the system to line their own pockets,” said U.S. Attorney Joshua S. Levy for the District of Massachusetts. “They manipulated and undermined the fair and open bidding process designed to save our military — and taxpayers — money. Contractors should be scrupulous in dealing with the government, not coordinating with each other to pad their bottom line. When defense contractors collude, rather than compete, they violate the law and the public’s trust.”
“The DoD expects its contractors to compete in open and fair markets,” said Special Agent in Charge Patrick J. Hegarty of the DoD’s Office of Inspector General’s Defense Criminal Investigative Service (DCIS) Northeast Field Office. “Today’s announcement demonstrates our commitment to work with our law enforcement partners to investigate allegations of anticompetitive practices and ensure the integrity of the DoD’s procurement process.”
“Department of the Army Criminal Investigation Division works diligently to maintain the Army’s readiness and will continue to work closely with our law enforcement partners to prevent and thoroughly investigate fraudulent activity,” said Special Agent in Charge Keith K. Kelly of the Department of the Army Criminal Investigation Division (CID)’s Fraud Field Office. “CID is committed to providing expertise and capabilities supporting whole of government efforts to ensure the U.S. Army remains the most technologically advanced, capable, and ready fighting force in the world.”
The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of Massachusetts, with assistance from DCIS, Army CID, Air Force Office of Special Investigations and the General Services Administration Office of Inspector General.
Trial Attorney Samson Asiyanbi of the Justice Department’s Civil Division and Assistant U.S. Attorneys Lindsey Ross and Brian LaMacchia for the District of Massachusetts handled the matter.
The claims resolved by the settlement are allegations only. There has been no determination of liability.
Settlement
Georgia Man Sentenced to 40 Years in Prison for Armed Fentanyl TraffickingRead the Press Release
ALBANY, Ga. –A Southwest Georgia resident with a lengthy criminal history who distributed kilograms of fentanyl and other deadly drugs while in possession of firearms and ammunition was sentenced to serve 40 years in federal prison for his crimes.
Larry Roger Sparks, Jr., 46, of Albany, was sentenced to serve 480 months in prison to be followed by ten years of supervised release by Chief U.S. District Judge Leslie A. Gardner on Jan. 3. Sparks previously pleaded guilty to one count of distribution of a heroin and fentanyl mixture; one count of distribution of methamphetamine; three counts of distribution of methamphetamine at a place where a person under age 18 resides; one count of possession of methamphetamine with intent to distribute at a premises at which a person under 18 resides; one count of possession of fentanyl with intent to distribute; and one count of possession of a firearm in furtherance of a drug trafficking crime (a Sig Sauer Model P365 SAS 9mm pistol). There is no parole in the federal system.
“Fentanyl and guns are a dangerous combination which will not be tolerated by this office or our law enforcement partners,” said U.S. Attorney Peter D. Leary. “Repeat armed drug traffickers will be held accountable for committing crimes which wreck the peace and safety of a community.”
“Locking away criminal drug dealers who choose to push poison on our streets will literally save lives as fentanyl is the number one killer among Americans aged 18-45,” said Robert J. Murphy, Special Agent in Charge of the DEA Atlanta Division.
“Drug traffickers are poisoning our communities with drugs like fentanyl,” said GBI Director Chris Hosey. “This case serves as an example of our continued efforts to stop the drug traffickers who ruthlessly target Georgia communities. The GBI, along with our law enforcement partners, will continue working toward ridding our state of these deadly drugs.”
According to court documents, a 2023 undercover GBI investigation into armed fentanyl trafficking in Southwest Georgia led agents to Sparks, who was distributing large quantities of fentanyl, heroin and methamphetamine from his Albany residence, where three minor children resided. Agents, working with a confidential source under surveillance and electronic recording, purchased controlled substances from Sparks five times, beginning on March 9, 2023, and ending with a final undercover purchase on May 3, 2023, when Sparks sold 478.2 grams of 98% pure methamphetamine.
Agents executed a federal search warrant on May 16, 2023, at Sparks’ residence located at 1501 Pinecrest Drive in Albany. As agents made their approach, three suspected drug customers in the yard fled; one of the individuals discarded a small quantity of suspected heroin and fentanyl mixture. Inside the home, agents found 1.2 kilograms of fentanyl, approximately three kilograms of methamphetamine, needles, scales, Narcan, cash and other items associated with drug use and distribution. Agents found six firearms, including a Sig Sauer 9mm pistol. Lab results for the drugs seized at the residence are: 1,206 grams of fentanyl, 1,776 grams of 95% pure methamphetamine and 963 grams of 98% pure methamphetamine.
The defendant was taken into custody during a traffic stop on May 16, and was in possession of a loaded Glock 10 mm semiautomatic handgun, a loaded 50-round drum magazine, a 9mm semiautomatic handgun and more than $5,000 in cash. Sparks admitted to receiving a four-kilogram shipment of fentanyl before the search, and said that he had sold all of it, less the 1.2 kilos recovered by agents in his home.
Sparks has a lengthy criminal history and has been previously convicted of armed robbery and delivery of a controlled substance in Saginaw, Michigan, as well as possession of cocaine with intent to distribute in the Superior Court of Crisp County, Georgia.
The case was investigated by the Worth County Sheriff’s Office, the Lee County Sheriff’s Office, the GBI Southwestern Regional Drug Enforcement Office (SWRDEO) and the DEA.
Criminal Chief Leah McEwen prosecuted the case for the Government.
Foreign National Pleads Guilty to Unlawful ReentryRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Adelby Isloa Martinez Mendez, age 35, of Honduras, entered a guilty plea to one count of Unlawful Reentry of a Removed Alien.
The Indictment alleged that on or about March 5, 2024, Martinez Mendez, an alien, was found in the United States after having been previously deported and removed on two prior occasions.
The charges arose from an investigation by the Bryan County Sheriff’s Office and the U.S. Department of Homeland Security’s Immigration and Customs Enforcement Division.
The Honorable Jason A. Robertson, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, accepted the plea and ordered the completion of a presentence investigation report. Martinez Mendez will remain in the custody of the United States Marshals Service pending sentencing.
Five gang members sentenced to prison for armed robbery spreeRead the Press Release
NORFOLK, Va. – Five men affiliated with the United Blood Nation gang have been sentenced to prison for their roles in a series of armed robberies of convenience stores in Virginia Beach and Norfolk.
According to court documents, on January 14, 2022, Harold Edward Spencer III, 34, of Virginia Beach, and Kareem Doyle Ross, 34, of Newport News, began a two-month robbery spree when they robbed a Citgo Mini Mart in Virginia Beach. Spencer and Ross entered the store and pointed firearms at employees, taking money, lottery tickets, and cigarettes. Later that day, Spencer and Ross, while still armed, robbed a Circle D Food Mart in Virginia Beach. During the robbery, Spencer fired his handgun twice at a fleeing customer.
On Feb. 7, 2022, Spencer, Ross, and a third individual robbed an Express Food Mart in Norfolk. On Feb. 19, 2022, Spencer, Ross, and Marvin Eugene Lockhart Jr., 34, of Virginia Beach, robbed a Crown Gas Station in Virginia Beach. During both robberies, all of the conspirators pointed firearms at employees and customers and stole money and cigarettes. During the Express Food Mart robbery, the men also took lottery tickets and cigars.
On March 5, 2022, Spencer, Ross, and Roshaun Devon Griffin, 36, of Virginia Beach, robbed an Arrowhead Food Mart in Virginia Beach, again taking money, cigarettes, and lottery tickets. During the robbery, Spencer and Ross pointed firearms at an employee.
On March 12, 2022, Spencer, Ross, and Lockhart robbed a Jr. Market in Norfolk, taking money and lottery tickets. During the robbery, all three pointed firearms at an employee.
On March 18, 2022, Ross, Spencer, Lockhart, Griffin, and Jon Demetrious Jacques Morgan, 34, of Portsmouth, attempted to rob a Tiger Mart in Virginia Beach. During the attempted robbery, Ross, Lockhart, Griffin, and Morgan approached the Tiger Mart as a group while Spencer remained in a vehicle nearby as a getaway driver. Ross, Lockhart, Griffin, and Morgan aborted the robbery and ran back to the getaway vehicle. The group then attempted to flee from the police. As they attempted to escape, the conspirators threw from the car the firearms they had possessed during the robbery. Virginia Beach Police used spike strips to disable the vehicle and all five conspirators were arrested.
On Oct. 4, 2022, Griffin pled guilty to conspiracy to interfere with commerce by means of robbery; interference and attempted interference with commerce by means of robbery; and using, carrying, and brandishing a firearm during and in relation to a crime of violence. On June 9, 2023, Griffin was sentenced to 15 years and four months in prison.
On Oct. 14, 2022, Ross pled guilty to conspiracy to interfere with commerce by means of robbery; interference and attempted interference with commerce by means of robbery; and using, carrying, and brandishing a firearm during and in relation to a crime of violence. On June 13, 2023, Ross was sentenced to 27 years and one month in prison.
On Dec. 13, 2022, Spencer and Morgan were convicted at trial. Spencer and Morgan were convicted of conspiracy to interfere with commerce by means of robbery; attempted interference with commerce by means of robbery; and being a felon in possession of a firearm. Spencer was also convicted of using, carrying, and brandishing a firearm during and in relation to a crime of violence. On Nov. 7, 2023, Morgan was sentenced to seven years and three months in prison and Spencer was sentenced to 42 years and three months in prison.
On Oct. 6, 2022, Lockhart pled guilty to conspiracy to interfere with commerce by means of robbery; interference and attempted interference with commerce by means of robbery; and using, carrying, and brandishing a firearm during and in relation to a crime of violence.
Lockhart, who left a family member’s birthday party to commit one of the armed robberies, was sentenced today to 22 years and one month in prison.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office, and Paul Neudigate, Chief of Virginia Beach Police, made the announcement after Lockhart’s sentencing by U.S. District Judge Arenda Wright Allen.
Assistant U.S. Attorneys John F. Butler and Joseph E. DePadilla prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:22-cr-106.
El Departamento de Justicia llega a un acuerdo con la Policía de Antioch, California, para resolver la investigación de discriminación por motivos de razaRead the Press Release
El Departamento de Justicia anunció hoy un acuerdo con la Policía de Antioch, California (APD, por sus siglas en inglés) y la Ciudad de Antioch para resolver una investigación de conducta racista y discriminatoria de agentes de la APD contra miembros del público en Antioch.
El Departamento inició su investigación después de la divulgación pública de mensajes de texto discriminatorios que decenas de miembros del personal de la APD supuestamente intercambiaron entre septiembre del 2019 y enero del 2022. La División de Derechos Civiles del Departamento de Justicia y la Fiscalía Federal para el Distrito Norte de California investigaron conjuntamente el cumplimiento de la APD con el Título VI de la ley de Derechos Civiles de 1964 (Título VI) y las disposiciones antidiscriminatorias de la Ley General de Control de Delitos y Calles Seguras (ley de Calles Seguras). El Título VI y la ley de Calles Seguras prohíben, en su conjunto, la discriminación por motivos de raza, color de piel, origen nacional, sexo o religión por parte de entidades que reciben apoyo financiero federal, tal como la APD.
«La vigilancia policial justa y no discriminatoria es fundamental para la aplicación efectiva de la ley, especialmente para aquellas agencias que reciben financiación federal», comentó Kristen Clarke, la Fiscal General Auxiliar de la División de Derechos Civiles del Departamento de Justicia. «Al trabajar con el Departamento de Justicia para instituir una reforma policial, la Policía de Antioch está enviando un mensaje fuerte que la discriminación y la conducta indebida que impulsaron esta investigación no se tolerarán. El acuerdo que hemos conseguido garantizará que las prácticas policiales de Antioch estén libres de discriminación en el camino futuro—la comunidad no merece menos».
«La aplicación de la ley sólo es eficaz cuando inspira la confianza pública», afirmó Ismail Ramsey, el Fiscal Federal para el Distrito Norte de California. «Una fuerza policial que discrimina por motivos de raza y otras clases protegidas socava tanto la seguridad pública como la confianza pública. El acuerdo de hoy ayudará a garantizar que la vigilancia policial en Antioch se realice de manera constitucional y ayudará a restablecer la confianza pública».
En respuesta a la investigación, la APD, la Ciudad de Antioch, y la Administradora de la Ciudad trabajaron en cooperación con el Departamento para alcanzar un acuerdo de resolución que encarnase un compromiso con la ausencia de discriminación en las operaciones de vigilancia policial de la APD y el avance de sus esfuerzos continuos por prevenir y abordar las prácticas discriminatorias de aplicación de la ley.
En virtud del acuerdo, la APD contratará a un consultor experto en aplicación de la ley seleccionado conjuntamente por las partes para revisar y actualizar los procedimientos, políticas y capacitación de la APD sobre una variedad de temas, lo que incluye la vigilancia policial no discriminatoria, el uso de la fuerza, la contratación y ascensos, investigaciones de conducta indebida, la disciplina, la vigilancia comunitaria y el acceso lingüístico, entre otros temas. El acuerdo contempla una función para la Comisión de Supervisión de la Policía de Antioch y establece un marco para la recopilación de datos y la presentación de informes durante un período de cinco años de supervisión departamental, entre otras disposiciones.
La no discriminación en virtud del Título VI y la ley de Calles Seguras es una de las principales prioridades de la División de Derechos Civiles. Hay más información sobre la División de Derechos Civiles a www.justice.gov/crt. Los miembros del público pueden denunciar posibles infracciones de los derechos civiles en civilrights.justice.gov/report/.
Drug Dealer Receives 106-Month Sentence After Selling Quarter-Pound of Methamphetamine to an Undercover AgentRead the Press Release
United States Attorney Susan Lehr announced that Sherice Dismang, age 42, of Omaha, Nebraska, was sentenced on January 3, 2025, in federal court in Omaha, Nebraska for possession with intent to distribute methamphetamine. Chief United States District Court Judge Robert F. Rossiter, Jr. sentenced Dismang to 106 months’ imprisonment. There is no parole in the federal system. After Dismang’s release from prison, she will begin a 5-year term of supervised release.
On February 27, 2023, law enforcement set up a controlled drug transaction against Dismang in Omaha, Nebraska. During the controlled drug transaction, Dismang met with her source of supply and acquired the 100 grams of lab-confirmed actual meth which she then turnaround and sold directly to the undercover agent.
This case was investigated by the Drug Enforcement Administration.
Defense Contractor Agrees to Pay $628,000 to Settle False Claims Act AllegationsRead the Press Release
NEWARK, N.J. - A Vermont company will pay $628,328 to resolve allegations that it sold substandard items to the United States Army, U.S. Attorney Philip Sellinger announced today.
The settlement resolves allegations that from July 13, 2018 through November 21, 2019, Live Wire, LLC made false claims in conjunction with contracts awarded to it by the United States Army. Live Wire contracted with the Army to sell electronic communications headsets and admits in the settlement that it provided non-compliant headsets that were not tested to the appropriate military specifications prior to their sale. Upon discovering that the headsets were not properly tested, Live Wire self-disclosed that information to the Government and cooperated with the investigation.
U.S. Attorney Sellinger credited special agents of the United States Department of Defense, Office of Inspector General, Defense Criminal Investigative Service, Northeast Field Office, under the direction of Special Agent in Charge Patrick J. Hegarty, and special agents of the United States Army, Army Criminal Investigation Division, Northeast Field Office, under the direction of Special Agent in Charge Joel Kirch, for the investigation of the allegations against Live Wire.
The United States is represented by Assistant U.S. Attorney Mark C. Orlowski of the U.S. Attorney’s Health Care Fraud Unit in Newark.
livewire.settlementagreement.pdf
Booz Allen Agrees to Pay $15.875M to Settle False Claims Act AllegationsRead the Press Release
Booz Allen Hamilton Holding Corporation (Booz Allen) has agreed to pay the United States $15,875,000 to resolve allegations that Booz Allen Hamilton Engineering Services LLC (BES), a wholly owned subsidiary of Booz Allen, violated the False Claims Act by knowingly submitting fraudulent claims to the United States in connection with a General Services Administration (GSA) task order to supply computer military training simulators and systems to Department of Defense (DoD) agencies, including the Air Force. Booz Allen, which is headquartered in McLean, Virginia, provides a range of management, consulting and engineering services to the government. BES was an engineering services firm located in Annapolis Junction, Maryland, with offices in Dayton, Ohio, and other locations.
The settlement announced today resolves allegations that BES, through its former program managers John G. Hancock and Karen K. Paulsen, knowingly engaged in a fraudulent course of conduct with Keith A. Seguin, then a civilian Air Force employee and contracting official, and David J. Bolduc Jr., the co-owner and manager of a BES subcontractor, QuantaDyn Corporation, that resulted in GSA awarding BES a task order for training simulators. BES, in turn, awarded task orders (or “modules”) to QuantaDyn. The government alleges that Seguin improperly and illegally divulged confidential government contracting and budget information, a competitor’s confidential bid or proposal information and source selection information to Hancock and Paulsen, who used the illicit information despite knowing they were not authorized to possess it. Through this conduct, Hancock and Paulsen successfully influenced GSA to award the task order to BES.
Additionally, the government alleges that, after the GSA award, Hancock, Paulsen, Seguin and Bolduc made use of confidential government budget information to formulate and submit price quotes to GSA for the individual modules that BES awarded to QuantaDyn on a sole-source basis. As a result of the conduct described above, BES, through Hancock and Paulsen, knowingly submitted fraudulent claims to GSA under the 37 modules awarded to QuantaDyn, which GSA paid. Hancock, Paulsen, Seguin and Bolduc previously resolved criminal charges related to this conduct.
“Government contractors that improperly receive confidential government information during the procurement process corrupt the integrity of that process,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This settlement demonstrates our continuing commitment to protecting the integrity of the government’s procurement process.”
“Over the past several years, my office has used every tool at its disposal — from civil settlements to criminal prosecution to asset forfeiture — to hold accountable the companies and individuals that helped a corrupt federal employee at Randolph Air Force Base defraud the United States by steering training simulator contracts,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “I am grateful for the assistance of the Department of Justice’s Civil Division and our law enforcement partners in finally closing the book on this fraud scheme with the civil settlement announced today.”
“This case demonstrates the unwavering dedication of the DoD Office of Inspector General’s Defense Criminal Investigative Service (DCIS), along with our law enforcement partners, to aggressively pursue those who undermine the integrity of the DoD contracting process,” said the Honorable Robert P. Storch, Inspector General of the Department of Defense. “This settlement announcement highlights the steadfast commitment of DCIS and our investigative partners to holding accountable those who seek to enrich themselves by jeopardizing the welfare of America’s warfighter and defrauding American taxpayers.”
“The GSA Office of Inspector General will continue working with law enforcement partners to protect taxpayer dollars and the integrity of federal contracting,” said GSA Deputy Inspector General Robert C. Erickson.
The civil resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Western District of Texas, with assistance from the GSA Office of Inspector General (OIG); DCIS; and the Defense Contract Audit Agency (DCAA), Headquarters, Operations Investigative Support Division (OIS).
Attorneys Seth W. Greene and Art J. Coulter of the Civil Division’s Fraud Section, and Assistant U.S. Attorney Thomas A. Parnham Jr. for the Western District of Texas handled the matter, with assistance from GSA OIG Special Agent Gregory A. Fallecker.
In September 2020, the United States entered into a civil settlement agreement with QuantaDyn and William T. Dunn Jr., the majority owner, president and CEO of QuantaDyn.
The claims resolved by the United States are allegations only. There has been no determination of liability.
Settlement
Baton Rouge Man Indicted for Distribution of Heroin and Fentanyl with Death and Serious Bodily Injury Resulting from the Use of the Heroin and FentanylRead the Press Release
A federal grand jury recently returned a two-count indictment charging Ecknozzio C. Jackson, Jr., age 33, of Baton Rouge, Louisiana, with distribution of heroin and fentanyl with death and serious bodily injury resulting from the use of the heroin and fentanyl. On January 2, 2025, Jackson appeared for his arraignment and pled not guilty to the pending charges.
According to court documents, on or about December 16, 2019, Jackson distributed a substance containing a detectable amount of heroin, with serious bodily injury resulting from the use of the heroin after being ingested by an individual. Then on or about December 17, 2019, Jackson distributed a substance containing detectable amounts of heroin and fentanyl with death and serious bodily injury of an individual resulting from the use of said heroin and fentanyl.
The indictment counts are each punishable by a mandatory minimum term of imprisonment of 20 years and up to life.
This matter is being investigated by the Drug Enforcement Administration and East Baton Rouge Sheriff’s Office, and is being prosecuted by Assistant United States Attorney Paul L. Pugliese.
NOTE: An indictment is an accusation by a grand jury. The defendant is presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Ardmore Resident Pleads Guilty to Federal Firearm ChargeRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Michael Adrian Wrenn, age 36, of Ardmore, Oklahoma, entered a guilty plea to an Information of one count of Felon in Possession of a Firearm.
The Information alleged that on December 9, 2023, Wrenn knowingly possessed a semiautomatic 9mm caliber pistol, after having been convicted of a crime punishable by a term of imprisonment exceeding one year.
The charge arose from an investigation by the Ardmore Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The Honorable D. Edward Snow, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, accepted the plea and ordered the completion of a presentence investigation report. Wrenn will remain in the custody of the United States Marshals Service pending sentencing.
Assistant U.S. Attorney Jonathan E. Soverly represented the United States.
Amite Man Charged with Kidnapping Resulting in Death and Transporting a Minor in Interstate Commerce with Intent to Engage in Criminal Sexual ActivityRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that DANIEL WAYNE CALLIHAN (“CALLIHAN”), age 37, a resident of Amite, Louisiana, was charged today in a two-count bill of information with kidnapping resulting in death, in violation of Title 18, United States Code, Section 1201(a) (Count 1), and transporting a minor in interstate commerce with intent to engage in criminal sexual activity, in violation of Title 18, United States Code, Section 2423(a) (Count 2). CALLIHAN was previously charged for his crimes in a federal complaint on June 14, 2024, and has remained in federal custody since that time.
According to the bill of information, on or about June 13, 2024, CALLIHAN kidnapped Minor Victim 1 and Minor Victim 2 from Loranger, Louisiana, and transported them to the State of Mississippi, using a 2012 Chrysler 200. CALLIHAN's actions resulted in the deaths of Minor Victim 1 and Adult Victim 1.
Additionally, the bill of information alleges CALLIHAN transported Minor Victim 2 from the State of Louisiana to the State of Mississippi with intent that Minor Victim 2 engage in sexual activity for which any person can be charged with a criminal offense, namely violations of criminal laws of the State of Louisiana, including La. Rev. Stat. 14.81 and La Rev. Stat. 43.1, and the State of Mississippi, including Miss. Code § 97-3-95 and Miss. Code § 97-5-23.
For Count 1, CALLIHAN faces a mandatory minimum sentence of life in prison, up to three years of supervised release, up to a $250,000 fine, and a $100 mandatory special assessment fee. For Count 2, CALLIHAN faces a mandatory minimum of ten (10) years in prison, and up to life in prison, at least five (5) years and up to a lifetime of supervised release, up to a $250,000 fine, and a $100 mandatory special assessment fee. A conviction on Count 2 may also require CALLIHAN to register as a sex offender.
U.S. Attorney Evans reiterated that a bill of information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
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 Department’s Child Exploitation and Obscenity Section(CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit Justice.gov/PSC.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation in investigating this matter and expressed appreciation for the support provided by the United States Marshals Service, Tangipahoa Sheriff’s Office, Mississippi Bureau of Investigation, and Jackson (Mississippi) Police Department. Additionally, U.S. Attorney Evans commended the work of the U.S Attorney’s Office Victim Witness Unit. Assistant United States Attorneys Jordan Ginsberg, Chief of the Public Integrity Unit, and Sarah Dawkins, of the Violent Crime Unit, are in charge of the prosecution.
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Activity in the U.S. Attorney's Office Recent SentencingsRead the Press Release
Firearm Offenses
Anthony William Glandt, 45, of Casper, WY, was sentenced to 8 months with 2 years of supervised release to follow, for being a felon in possession of a firearm. According to court documents, on November 17, 2023 Glandt was in possession of three firearms after law enforcement was called to the defendant’s residence for a possible domestic disturbance. Glandt is a previously convicted felon and is prohibited from possessing a firearm. Glandt was indicted on July 18. U.S. District Court Judge Alan B Johnson. imposed the sentence on December 20 in Casper. The Bureau of Alcohol, Firearms, Tobacco and Explosives and the Casper Police Department investigated the crime. Assistant U.S. Attorney Paige Hammer prosecuted the case. Case No. 20-CR-00112.
Illegal Re-Entry of a Previously Deported Alien
Hector Valencia-Cuevas, 33, of Mexico, was sentenced to time served plus up to 10 days for deportation proceedings with one year unsupervised release to follow and will be deported for illegal reentry into the United States. According to court documents, on Oct 04, Valencia-Cuevas was arrested in Rock Springs, WY for Delivery or Possess with intent to Deliver Narcotics. The defendant claimed to be a citizen of Mexico and agents with Immigration and Customs Enforcement (ICE) were contacted. They determined that Valencia-Cuevas had previously been removed from the U.S. on three occasions and had not applied for permission to reenter. Valencia-Cuevas was last removed on 06/24/2018. ICE investigated the crime, and Assistant U.S. Attorney Cameron J. Cook prosecuted the case. U.S. District Court Judge Kelly Rankin imposed the sentence on Jan 3, in Cheyenne. Case No. 24-CR-00178.
About the United States Attorney’s Office
The United States Attorney’s Office is responsible for representing the federal government in virtually all litigation involving the United States in the District of Wyoming, including all criminal prosecutions for violations of federal law, civil lawsuits brought by or against the government, and actions to collect judgments and restitution on behalf of victims and taxpayers. The Office is involved in several programs designed to make our communities safer. They include:
Environmental Justice
The fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations, and policies.
Project Safe Childhood
Project Safe Childhood (PSC) is a DOJ initiative that combats the proliferation of technology-facilitated sexual exploitation crimes against children. The threat of sexual predators soliciting children for sexual contact is well-known and serious.
Project Safe Neighborhoods
Project Safe Neighborhoods (PSN) is a nationwide commitment to reducing gun and gang crime in America by networking existing local programs that target gun crime and providing these programs with additional tools necessary to be successful.
Victim Witness Assistance
The Victim Witness Coordinator for the United States Attorney’s Office for the District of Wyoming is dedicated to making sure that victims of federal crimes and their family members are treated with compassion, fairness, and respect.To report a federal crime, go to: https://www.justice.gov/actioncenter/report-crime
Thursday 2 January 2025
Virginia Beach doctor agrees to $625,000 False Claims Act settlementRead the Press Release
NORFOLK, Va. – Dr. Scott Saffold, of Virginia Beach, and his practice, Chesapeake Bay, ENT, P.C. (Chesapeake Bay), located in Belle Haven, have agreed to pay $625,000 to settle a civil fraud case that claimed Dr. Saffold and his medical practice engaged in the routine and systematic practice of falsely billing government health care programs.
The United States and the Commonwealth of Virginia alleged that Saffold and Chesapeake Bay billed federal and state payors for balloon sinus dilations that were not medically necessary. The government alleged that Saffold and Chesapeake Bay performed these surgeries on six sinuses for many patients even when there was no medical indication of need in some or all dilated sinuses. The government further alleged that Saffold and Chesapeake Bay staged these procedures, performing each side at separate times, to increase reimbursement from government payors and without any medical justification. The government also alleged that Saffold and Chesapeake Bay routinely billed government payors for endoscopies with sphenoid sinusoscopy under Current Procedural Terminology Code 31235 when they were not actually performing that code.
The settlement arises in connection with a lawsuit filed under the whistleblower provision of the False Claims Act. A whistleblower suit, or qui tam action under the False Claims Act, is commenced by an individual filing a complaint under seal in the U.S. District Court and providing a copy of the complaint and evidence to the U.S. Attorney’s Office. The United States then has an opportunity to investigate the claims. The False Claims Act provides whistleblowers with a share of the government’s recovery.
The resolutions obtained in this matter were the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of Virginia; Health and Human Services Office of Inspector General; Department of Defense Office of Inspector General, Defense Criminal Investigative Service; and the Commonwealth of Virginia’s Office of the Attorney General.
The matter was handled by Assistant U.S. Attorney Clare Wuerker and Senior Assistant Attorney General Kristin Gray and Assistant Attorney General Airen Adamonis from the Virginia Medicaid Fraud Control Unit.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Case records may be found on PACER under case number 2:18cv435.
The civil claims settled are allegations only; there has been no determination of civil liability.
Upper St. Clair Man Who Traveled to Lebanon and Syria with Goal of Joining Hizballah Indicted on Terrorism Offense and for Lying to FBIRead the Press Release
PITTSBURGH, Pa. - A former resident of Upper St. Clair, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on charges of attempting to support the foreign terrorist organization Hizballah and making false statements involving international terrorism to a department or agency of the United States, United States Attorney Eric G. Olshan announced today.
The three-count Indictment names Jack Danaher Molloy, 24, formerly of the Upper St. Clair suburb of Pittsburgh, as the sole defendant. Molloy was previously charged on December 6, 2024, by way of Criminal Complaint with the false statement charges, with much of the conduct underlying the charges in the Indictment set forth in the Complaint Affidavit. Read the full affidavit filed in support of the Criminal Complaint against Molloy here. The Indictment is available here. Molloy was arrested in Chicago, Illinois, on December 6, 2024, and transported by the United States Marshals Service to Pittsburgh on December 30, 2024.
As alleged in the Indictment and Complaint Affidavit, from in and around August 2024 through in and around December 2024, in Lebanon, Syria, the Western District of Pennsylvania, and elsewhere, Molloy attempted to provide material support and resources—namely, personnel (including himself) and services—to Hizballah, a foreign terrorist organization (FTO), knowing that the organization was a designated terrorist organization and that the organization had engaged in and was engaging in terrorist activity and terrorism. As outlined in the court documents, Hizballah, also commonly spelled Hezbollah, was formed in the wake of the 1982 Israeli invasion of Lebanon and has conducted numerous terrorist attacks against Israeli and Western targets, including against American military and diplomatic personnel.
As alleged, Molloy—a dual citizen of the United States and Ireland, who previously served on active-duty status in the U.S. Army—traveled to Lebanon in August 2024 and attempted to join Hizballah. While in Lebanon, Molloy was told by multiple individuals that the time was not right, and that he needed to take other steps before he could join the terrorist organization. Molloy then traveled from Lebanon to Syria in October 2024 in an effort to fight for Hizballah in Syria. After returning to the United States, Molloy resided in Upper St. Clair, where he continued his attempts to join Hizballah, including through communication with individuals online and in Lebanon. During his time in the United States and abroad, Molloy also allegedly expressed his hatred toward, and promoted violence against, Jewish people. Molloy’s alleged animus toward Jews was also evidenced by multiple images and videos on his electronic devices and the usernames he chose for his social media and email accounts, including the username “KIKEKILLER313” on the social media platform X. In one alleged WhatsApp exchange with a family member, Molloy agreed that his “master plan was to join Hezbollah and kill Jews.” And while he was residing in Upper St. Clair, Molloy also allegedly visited a website detailing the possible incarceration location of Robert Bowers, who carried out the Pittsburgh Tree of Life Synagogue shooting during which he murdered 11 Jewish worshippers.
The Indictment further alleges that, upon arriving at the Pittsburgh International Airport on October 20, 2024, Molloy lied to agents of the FBI when he told them (1) that he had no current or future plans to become involved with Hizballah, and (2) that he had no business in, nor was he meeting with anyone, in Syria. These statements and representations were false because Molloy knew at that time that (1) he did have current and future plans to become involved with Hizballah and (2) Molloy travelled to Syria in furtherance of his attempts to join Hizballah, and while in Syria, set up a meeting with an individual there.
“As alleged, Jack Molloy, an avowed adherent of Hizballah harboring deep-seated animus against Jews, took many steps over a period of months—at home and abroad—in his effort to join and fight for this deadly foreign terrorist organization,” said U.S. Attorney Olshan. “This case is yet another sobering reminder of the threat of radicalized violence against Americans. And while the defendant appears to have worked hard to achieve his terrorist goals, today’s charges demonstrate that the resolve of our office and our partners in law enforcement is stronger. We will continue working every day to ensure that members of the Jewish community and every other community in this country can live their lives without fear that they will be targeted by a hate-fueled terrorist attack.”
“The FBI’s number one priority is to protect the American people from both domestic and international terrorist threats,” said FBI Pittsburgh Special Agent in Charge Kevin Rojek. “To achieve that end, the FBI will leverage the entirety of our resources, partnerships, and all applicable laws to bring to justice anyone who seeks to support or aid any foreign terror organizations, especially groups as deadly as Hizballah.”
The maximum sentence for the material support offense is a term of imprisonment of 20 years, a fine of $250,000, or both. Each of the false statement charges carries a maximum sentence of eight years in prison, a $250,000 fine, 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 Nicole Vasquez Schmitt and Trial Attorney Andrew Briggs of the National Security Division’s Counterterrorism Section are prosecuting this case on behalf of the government.
The Pittsburgh and Chicago offices of the Federal Bureau of Investigation conducted the investigation leading to the Indictment, with substantial assistance following Molloy’s arrest on the Criminal Complaint from the United States Marshals Service.
An indictment and a criminal complaint are accusations. A defendant is presumed innocent unless and until proven guilty.
USAO General Crimes Unit Ends 2024 with Notable AchievementsRead the Press Release
CLEVELAND – The General Crimes Unit of the United States Attorney’s Office (USAO) for the Northern District of Ohio is responsible for prosecuting individuals who violate a wide variety of federal laws in any of the 40 northern counties in the state of Ohio which the district serves.
These Assistant U.S. Attorneys focus on prosecuting crimes that involve firearms violations, illegal drugs, and violent crimes such as armed robberies, carjackings, and/or make threatening communications. They also hold those accountable who sexually abuse children, fail to register as sex offenders, possess and/or distribute pornographic images of minors engaged in sexually explicit conduct, and engage in human trafficking.
Reducing violent crime has been a top focus of the Department of Justice and the USAO. To further those efforts, a new Crime Gun Intelligence Center (CGIC) was opened in the District in June 2024. Attorney General Merrick Garland and ATF Director Steven Dettelbach, alongside U.S. Attorney Rebecca Lutzko, announced the center’s opening at a press conference earlier this year. The CGIC serves as a hub for federal and local law enforcement to investigate and prevent gun violence in the region. It utilizes cutting-edge technology and tracing systems to rapidly develop and pursue investigative leads that have helped to drive violent crime rates down in Northern Ohio this year. With these experts located in the same facility, this team of firearm evidence examiners, intelligence analysts, and investigators can rapidly collect, analyze, and share information about guns used in violent crimes.
“Driving down violent crime has, without a doubt, been one of our office’s top priorities,” said U.S. Attorney Lutzko. “With the CGIC now fully operational, it allows us to connect the dots between crimes so we can prosecute, convict, and lock up the bad actors who commit violent crimes and remove “crime guns” from the streets faster, so neither continue to endanger innocent people in neighborhoods throughout Northern Ohio.”
Notable operations and cases for fiscal year 2024 include the following:
Violent Crime Reduction Operation – After a three-month, violent crime reduction initiative in the summer of 2023, a total of 84 defendants were charged in connection with firearms-trafficking, straw purchasing firearms, narcotics, conspiracy, and other firearms offenses. The investigation was led by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and resulted in the seizure of more than 255 firearms, of which 47 were traced back to other crimes. The seizure also included 17 untraceable firearms, also known as “ghost guns.” Seventy defendants were charged federally and the remaining 14 faced state charges. Sixty of those entered guilty pleas, 49 of which have been sentenced to date. Of the 14 defendants charged in the state, 12 have pled guilty and been convicted and sentenced. Some notable prison sentencings for various federal firearms violations include Darvell Jackson, sentenced to 168 months; Cortez Buggs sentenced to 132 months; Kenneth Smith sentenced to 135 months; Darion Shelton, sentenced to 100 months; Willie Earl Jackson sentenced to 84 months.
U.S. v. Conner Walker – In early January 2024, the FBI Cleveland Division received a lead that a sexually explicit picture of a two-year-old was likely a child residing in Northeast Ohio. After the FBI confirmed the child’s identity, they learned that she spent time at an in-home day care in Parma, Ohio. Walker was identified as a friend of the day care owner’s adult son who frequented the home and often stayed the night. During an interview, he admitted to sexually abusing the child, filmed it on his phone, and distributed the video online. Walker entered guilty pleas to sexual exploitation, receipt, distribution, and possession of child pornography and is currently awaiting sentencing.
U.S. v. Shannon Matheny – On Oct. 26, 2022, a bank in Lorain, Ohio, was robbed by a man armed with a small silver semi-automatic firearm. The teller reported that the suspect entered, approached counter, slid a note under plexiglass indicating that it was robbery, that he had a gun, not to touch the alarm, and to hand over all fifty, hundred, and twenty-dollar bills. When the teller retrieved the cash from her drawer and handed it to him, he walked away with more than $4,000 from the bank. The Lorain Police Department investigated anonymous tips and reviewed surveillance videos. Two days later, Matheny was located and then arrested after a police chase. A bookbag containing a loaded firearm, fentanyl, cocaine, and two cellphones were seized from Matheny. Matheny was convicted on all counts after a five-day trial in April 2024. In August, he was sentenced to 78 months in prison, plus 84 months consecutive for brandishing a firearm during the course of a robbery, for a total of 162 months.
Additionally, to address regional crime issues, the USAO conducted numerous outreach efforts to diverse members of the community. These included discussions with religious and ethnic groups with concerns about the rise in hate crimes.
To report crimes, visit https://tips.fbi.gov/home.
USAO Forfeits More Than $7M in Criminal Assets in FY24, with More Than $50M of Assets Still PendingRead the Press Release
CLEVELAND – The U.S. Attorney’s Office (USAO) for the Northern District of Ohio forfeited $7,701,470 in criminal assets for fiscal year 2024 (FY24). The total forfeited assets were from investigations throughout the District’s 40 northern counties in the state of Ohio. The District’s headquarters is located in Cleveland, with branch offices in Akron, Toledo, and Youngstown.
At the end of FY24, the USAO had more than $50 million of assets still pending forfeiture orders in cases districtwide. They included items such as cash, cryptocurrency, vehicles, real estate, and jewelry. These assets were acquired from 214 cases brought under the three types of federal forfeiture proceedings, which include criminal, civil judicial, and administrative. Criminal forfeiture involves personal assets used in conjunction with a crime and is included as part of a defendant’s sentence. Civil judicial forfeiture concerns assets derived from or used in criminal activity. Administrative forfeiture involves assets for whom no one has filed a claim contesting the seizure.
Because of the time it can take to process appeals, payments to victims can stem from previous fiscal years. In FY24, a total of $11,077,758 of forfeited funds were earmarked for return to crime victims to whom defendants owed restitution.
Some of the forfeited assets were deposited into the Department of Justice Asset Forfeiture Fund (AFF), which was established in 1984 by the Comprehensive Crime Control Act. The AFF is used to restore funds to crime victims and pay expenses associated with forfeiture operation, such as asset management, storage, protection, and disposal. It is also used for a variety of law enforcement purposes. Other assets seized were deposited into the Treasury Asset Forfeiture Fund, which functions in a similar way to the AFF.
In addition, a portion of each fiscal year’s forfeited funds are authorized to be shared with local law enforcement agencies that contributed time and resources to federal investigations. In FY24, $10,523,635 was shared across 83 agency partners in the Northern District of Ohio, as well as other districts, for supporting federal prosecution efforts to fight crime.
“Asset forfeiture is a vital tool that we use to punish criminals and financially deter, disrupt, or dismantle criminal activity and criminal organizations. When we take the assets used to commit, or gained as the result of crime, we deprive criminals of the tools they need to engage in criminal activity and, indeed, their reason for committing such crimes in the first place. Additionally, forfeiting criminal assets allows us to return money lost by victims who were scammed by criminals in deceitful and fraudulent schemes or otherwise harmed by crime,” said Rebecca Lutzko, United States Attorney for the Northern District of Ohio. “The amount of assets forfeited this year and still pending forfeiture by the court far exceeds our annual office budget. We take pride in returning such significant amounts of money to our community and constituents from the work that our office undertakes.”
Cases with significant forfeitures in FY24 include the following:
United States v. Christen Clark
Clark pled guilty to federal drug and gun violations. During a search warrant execution, agents seized six kilograms of cocaine, two kilograms of fentanyl, 50 pounds of marijuana, and six handguns. The USAO forfeited $1,004,496 and a 2021 Chevrolet Tahoe from Clark.
United States v. Rocco Ferruccio
Defendant pled guilty to illegal gambling operations in Canton. The USAO forfeited $1,118,442 seized from Ferruccio’s residence.
United States v. Christos Karasarides
Related to the Ferruccio case, Karasarides was convicted of illegal gambling operations in Canton. The USAO forfeited $419,768 in U.S. currency. Karasarides’ residence was also determined to have been acquired with gambling proceeds and forfeited.
United States v. $774,830 in U.S. Currency
During an Ohio Highway Patrol traffic stop, a K-9 alerted to the trunk of a defendant’s rental car, and U.S. Currency was seized from a suitcase in the trunk. The defendant declined to provide the source of the currency. The USAO forfeited a total of $774,830.
United States v. Kevin Clay
Clay was found guilty of healthcare fraud and agreed to the USAO’s forfeiture of approximately $539,770 in proceeds of his fraud, along with the forfeiture of a home purchased with fraud proceeds. But, as alleged in a pending indictment, before the government took possession of his home, Clay instructed his wife to remove fixtures and appliances from it to sell, profiting about $5,000. In the process, his wife caused more than $20,000 in damage to the home and the government subsequently charged the couple with destruction or removal of property to prevent seizure.
United States v. 947,883 Tether (“USDT”)
In this elder fraud case, on Nov. 26, 2024, the United States filed a civil complaint in forfeiture against 947,883 Tether (“USDT”) cryptocurrency, valued at approximately $947,883. At the time the asset was frozen, the cryptocurrency address had a balance of 947,883 USDT, valued at approximately $947,883. If successful in this forfeiture action, the United States would seek to return these stolen funds to the victim of the scheme. Claims made in the Complaint in Forfeiture are allegations that the United States will need to prove should the case proceed to trial.
All defendants are presumed innocent and entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
The mission of the Department of Justice Asset Forfeiture Program (AFP) is to use asset forfeiture as a tool to deter, disrupt, and dismantle criminal enterprises, denying them the proceeds and the instruments of criminal activity. The AFP involves federal, state, tribal, and local law enforcement agencies across the country.
USAO Collects Nearly $28M in Civil and Criminal Actions for FY 2024Read the Press Release
CLEVELAND - In the fiscal year 2024 (FY 2024), the U.S. Attorney’s Office for the Northern District of Ohio collected $27,882,120.34 in civil and criminal actions. Of this amount, $12,537,202.34 was collected for civil damages, penalties, and interest owed to the United States, while $15,344,918 was collected for criminal restitution to victims of federal crime.
In addition to those amounts, the U.S. Attorney’s Office (USAO), working with partner agencies and divisions, also separately forfeited in FY 2024 $7,701,470 in assets connected to criminal activity, with more than $50M in additional assets still pending forfeiture orders. Forfeited assets are deposited into the Department of Justice Asset Forfeiture Fund or the Treasury Asset Forfeiture Fund and used to restore funds to crime victims and for various law enforcement purposes.
Accordingly, the U.S. Attorney’s Office collected a combined $35,583,590.34 in FY 2024.
“Every year, dedicated USAO employees work hard to collect debts owed to the government based on false claims, environmental damage, controlled-substance violations, and the like, and return that money to the U.S. taxpayers. They also work to recover money for victims of crime to make them whole and ensure that justice is served from a financial perspective,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “The USAO’s FY 2024 collection efforts were tremendously successful, and we remain committed, in 2025 and beyond, to using all available legal remedies to collect restitution for victims and recover taxpayer dollars improperly taken through fraud, waste, and abuse.”
Notable collections in FY 2024 include:
Civil Cases
Cleveland Clinic Foundation – Payment of $7,600,000 to settle False Claims Act allegations relating to federal grant applications and progress reports. That amount is now paid in full.
Ohio Refining Co., Chevron USA Inc., Energy Transfer (R&M) LLC, Pilkington North America Inc., and Chemtrade Logistics Inc. – Payment of $7,282,518.92 to settle allegations of historic industrial pollution discharges near Toledo. That amount is now paid in full.
Republic Steel – Payment of a civil penalty as part of a consent decree to settle Clean Air Act allegations. Republic Steel paid $1,051,169.49 as part of the consent decree, which also included air pollution reductions.
Criminal Cases
U.S. v. Aydin Kalantarov – Defendant was sentenced in May 2023 for conspiring to commit wire fraud and aggravated identity theft. The court ordered Kalantarov to pay $7,799,400.00 in restitution to the Small Business Association (SBA). In January 2024, the USAO facilitated the transfer of $5,624,627.21 in forfeited funds to the Clerk of Courts for payment to the SBA.
U.S. v. Matthew Maluchnik – Defendant was sentenced in October 2023 for committing healthcare fraud and making false statements on his tax returns. The court ordered him to pay $941,068.50 in restitution. In April 2024, the USAO facilitated the transfer of $715,979.50 in forfeited funds to the Clerk of Courts for payment to Maluchnik’s victims.
U.S. v. Christopher Hardin – Defendant was sentenced in September 2019 for committing mail fraud and was ordered to pay $671,699.73 in restitution to over a dozen victims. In FY2024, the USAO collected $655,574.73 from Hardin for his victims.
The 94 U.S. Attorneys’ Offices across the country, along with the Department of Justice’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.
While restitution is paid to the victim, criminal fines and felony assessments are paid to the Department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
U.S. Attorney’s Office’s Collection and Enforcement Efforts Exceed $40 Million in Fiscal Year 2024Read the Press Release
LEXINGTON, Ky. – United States Attorney Carlton S. Shier, IV announced today that, in the fiscal year ending September 30, 2024, the U.S. Attorney’s Office for the Eastern District of Kentucky collected more than $20 million for crime victims and taxpayers, and also obtained civil settlements totaling more than $20 million through its affirmative civil enforcement efforts.
“Our enforcement of the law includes pursuing restitution for victims of crime, recovering illegally obtained funds, and protecting taxpayer dollars from fraud, waste, and abuse,” said United States Attorney Shier. “These collection and enforcement results demonstrate our commitment to these critical goals. I want to commend the dedicated personnel in our Office, for their persistent efforts on behalf of victims and for safeguarding our taxpayer funds.”
In fiscal year 2024, the U.S. Attorney’s Office collected $14,299,361.43 through its Financial Litigation Program. This Program is responsible for collecting civil and criminal debts owed to the United States, and criminal restitution debts owed to federal crime victims who have suffered a physical injury or financial loss. While criminal restitution is paid to victims, criminal fines and assessments are paid to the Department of Justice’s Crime Victims Fund, which distributes the funds to federal and state victim compensation and victim assistance programs.
Additionally, due to successful asset forfeitures in fiscal year 2024, the U.S. Attorney’s Office secured $4,161,490 for federal law enforcement efforts, shared $1,508,364 with state and local law enforcement agencies, and restored $472,830 to crime victims. In asset forfeiture actions, the United States seizes money and property that were proceeds of crime or used in furtherance of a crime. Forfeited assets deposited into the Department of Justice Asset Forfeiture Fund are used for a variety of law enforcement purposes. Funds shared with state and local agencies reflect the degree of their participation in law enforcement efforts resulting in forfeiture. When money or property is forfeited by a defendant who also owes restitution, the Office can ask that the value of the forfeited property be paid to the victim to make him or her whole.
The Office’s Civil Division also protects the interests of the United States in cases involving property on which the government holds a lien. In fiscal year 2024, the Office collected $1,382,137.49 on behalf of taxpayers in such cases.
Finally, the U.S. Attorney’s Office’s Affirmative Civil Enforcement program obtained civil settlements and judgments valued at $20,078,263.98. Over $19.7 million of this amount were obtained through enforcement of the False Claims Act, which is a federal law that imposes treble damages and penalties on those who knowingly and falsely claim money from the United States. The False Claims Act thus serves to safeguard government programs that provide health insurance, support American businesses and workers, offer disaster and other emergency relief, and provide many other critical services and benefits. More than $300,000 of the settlements represent civil penalties paid by healthcare providers who violated the Controlled Substances Act, a federal law that aims to protect the public’s health and safety from dangers posed by highly addictive or dangerous controlled substances that are diverted into the illicit market. The remainder of these settlements result from penalties and compensatory damages paid for violations of the American with Disabilities Act, a federal law that protects people with disabilities from discrimination in many areas of public life.
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U.S. Attorney’s Office Reaches Agreement with Ellsworth Veterinarian for Alleged Controlled Substances Act ViolationsRead the Press Release
PORTLAND, Maine: A Maine veterinarian, Dr. Alan Toothaker, DVM, agreed to pay $145,360 to resolve claims he violated the Controlled Substances Act through improper storage of controlled substances and recordkeeping violations.
The settlement announced today resolves allegations that Dr. Toothaker improperly stored controlled substances; failed to keep appropriate records of controlled substances stored, dispensed, or distributed by the veterinary practice; and did not conduct regular inventories.
As alleged, in May 2023 and July 2023, the U.S. Drug Enforcement Administration (DEA) was unable to conduct an audit at Dr. Toothaker’s registered location due to record keeping deficiencies. Among the issues the resulting inspection revealed:
- Minimal oversight of the ordering, receiving, and handling of controlled substances, creating an opportunity for significant diversion of controlled substances, particularly Tramadol.
- Controlled substances stored in safes with non-controlled substances with employees having unsupervised access.
- Incomplete recordkeeping resulting in unaccounted-for controlled substances purchased, dispensed, or administered.
- Continual refills of prescriptions.
- Transferring of controlled substances to a second practice location for which Dr. Toothaker did not maintain a registration.
“The DEA investigation revealed a practice that lacked adequate security and oversight, making it difficult, if not impossible, to determine whether controlled substances were missing, who took them or even when they went missing,” said U.S. Attorney Darcie N. McElwee. “Particularly amid an opioid crisis, that is concerning. All DEA registrants have an obligation to maintain complete records, and it is an essential practice to prevent potentially addictive medications from being diverted from the legitimate drug supply.”
“The DEA is committed to ensuring that veterinarians, like all registrants, are in compliance with the required regulations, which are enforceable through the Controlled Substances Act, handle controlled substances in a lawful manner, and provide effective controls to prevent diversion,” said Acting Special Agent in Charge Stephen Belleau, New England Field Division. “Failure to do so increases the diversion potential and jeopardizes public health and safety.”
The claims resolved by the settlement are allegations only and there has been no determination of liability.
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U.S. Attorney’s Office Credits Multi-Jurisdictional Crime Reduction Collaborative for Sharp Decline in Violent Crime Across MarylandRead the Press Release
Baltimore, Maryland – Today, the U.S. Attorney’s Office for the District of Maryland announced that statewide violent crime continued to significantly decline in 2024. In Maryland, homicides and non-fatal shootings are down, and Baltimore City’s violent-crime rate dropped for the third year in a row.
Since 2021, statewide homicides have declined by 32 percent while Baltimore City, which saw 201 homicides in 2024, has recorded a 41-percent decrease during the same timeframe. The U.S. Attorney’s Office credits strategic collaboration between Federal, State, City law enforcement, and community partners for the positive direction.
“I’m very proud of the leadership that this office’s public servants have shown in coordinating law enforcement and community efforts throughout Maryland and beyond to protect our nation and promote safer communities,” said U.S. Attorney Erek L. Barron. “We will continue to be a force-multiplier for the work of our various Federal, State, and local law enforcement agencies, and community-based partners.”
These efforts are connected to the Department of Justice’s Project Safe Neighborhoods (PSN). This program brings together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make neighborhoods safer for everyone. Recent results show how the power of strong collaborations correlate with major declines in violence, as Baltimore City recorded its lowest homicide total since 2011. For example, in Baltimore City, the multi-jurisdictional collaborative has:
- Assembled the largest-ever, State-funded team of special federal prosecutors, and legal and investigative professionals to indict firearm offenses. In 2023, this enabled the U.S. Attorney’s Office to adopt a record-high number of gun cases from the Baltimore City State’s Attorney’s Office.
- Strategically investigated and federally prosecuted repeat violent offenders, who drive the most violence in our communities, by any legal means necessary. This tactic has led to impactful prosecutions. For example, the collaborative shut down an international Chinese money laundering and drug trafficking organization after investigating one of its ringleaders who was shot at twice within a two-week span of violence in Baltimore City.
- Leveraged the U.S. Attorney’s Office’s multi-agency taskforce to not only federally prosecute violent criminal organizations, but to also help local partners land impactful prosecutions. For example, through Operation Tornado Alley, the largest takedown in Baltimore in decades, the State’s Attorney’s Office charged 40 individuals with drug trafficking and firearm offenses.
Through these strategic, collaborative efforts, the office has reduced costly and unnecessary incarceration. The collaborative’s use of strategic law enforcement, along with various prevention and intervention methods, has resulted in a 40-percent decline in the federal pre-trial detention rate since 2018. For example, the U.S. Attorney’s Office actively supports reducing barriers to successful reentry and collaborative community-based outreach efforts aimed at youth and young adults, including by working with organizations such as ROCA Baltimore.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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- Assembled the largest-ever, State-funded team of special federal prosecutors, and legal and investigative professionals to indict firearm offenses. In 2023, this enabled the U.S. Attorney’s Office to adopt a record-high number of gun cases from the Baltimore City State’s Attorney’s Office.
U.S. Attorney, FBI Announce Federal Charges Against Arizona Man for Sexual AbuseRead the Press Release
ALBUQUERQUE – A Phoenix man has been charged with two counts of aggravated sexual abuse of a child under 12 years old.
The indictment alleges that between January 1, 2019, and December 31, 2019, Jeremy Blueeyes, 25, a member of the Navajo Nation, unlawfully and knowingly engaged in and attempted to engage in sexual acts with a child who had not yet attained the age of 12 years.
Blueeyes will remain in custody pending trial, which has not been scheduled. If convicted, Blueeyes faces a minimum of 30 years and up to life in prison.
U.S. Attorney Alexander M.M. Uballez and Raul Bujanda, Special Agent in Charge of the FBI Albuquerque Field Office, made the announcement today.
The Gallup Resident Agency of the FBI Albuquerque Field Office investigated this case with assistance from the Navajo Police Department and Navajo Nation Department of Criminal Investigations. Assistant U.S. Attorney Nicholas J. Marshall is prosecuting the case.
View the Indictment (Blueeyes).pdfAn indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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U.S. Attorney's Office Secures Sentencing of Mexican National for Attempted Aircraft Destruction and Drug TraffickingRead the Press Release
ALBUQUERQUE – A Mexican national was sentenced to 117 months in prison and ordered to pay a $600 special assessment for attempting to destroy an unmanned aerial system and federal drug trafficking offenses in New Mexico.
According to court documents, on July 3, 2023, officers from the Albuquerque Police Department tracked Rogelio Rodriguez-Salas, 29, a Mexican national who had previously been deported and was illegally present in the United States, by using a drone while he was in possession of a stolen vehicle. In an attempt to evade surveillance, Rodriguez-Salas fired a handgun at the drone to damage and disable it. Following this incident, he was arrested but subsequently released into the community.
Weeks later, on July 21, 2023, deputies from the Bernalillo County Sheriff's Department encountered Rodriguez-Salas again. He was found in possession of a revolver while engaged in drug trafficking activities and driving another stolen vehicle. At that time, he had more than four grams of fentanyl intended for distribution when stopped by deputies. His illegal presence in the U.S. prohibited him from possessing both firearms and ammunition.
On July 15, 2024, Rodriguez-Salas pleaded guilty to multiple charges: attempting to damage, destroy, disable, and wreck an aircraft; being a prohibited person in possession of a firearm and ammunition; re-entering the United States as a removed alien; possessing with intent to distribute four grams or more of fentanyl; and possessing a firearm to further a drug trafficking scheme.
Upon his release from prison, Rodriguez-Salas will be subject to three years of supervised release and subject to deportation proceedings.
U.S. Attorney Alexander M.M. Uballez made the announcement today.
The U.S. Department of Transportation, Office of Inspector General conducted this investigation with the Albuquerque Police Department and U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations. This case is being prosecuted by the U.S. Attorney’s Office for the District of New Mexico.
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U.S. Attorney Ryan K. Buchanan Announces Upcoming ResignationRead the Press Release
ATLANTA – U.S. Attorney Ryan K. Buchanan has announced his resignation, effective January 19, 2025, as the chief law enforcement officer for the Northern District of Georgia. After he was nominated by President Joseph R. Biden, Jr. and confirmed by the U.S. Senate, U.S. Attorney Buchanan was sworn in as the District’s 26th Presidentially-appointed and Senate-confirmed United States Attorney on May 2, 2022.
During his tenure, U.S. Attorney Buchanan led an office of approximately 250 prosecutors, civil litigators, and administrative and support personnel in its mission to enforce federal civil and criminal laws, advocate for crime victims, and represent the United States’ interests in federal court. In his role, he oversaw prosecutions involving violent crimes, firearm offenses, drug trafficking organizations, child exploitation, cybercrimes, health care fraud, public corruption, organized crime rings and gang activities, hate crimes, and civil rights violations, while also achieving significant judgments and penalties in multiple civil matters.
Beyond the Northern District, U.S. Attorney Buchanan contributed to the Department of Justice’s national legal policy as a member of Attorney General Merrick Garland’s Advisory Committee (the “AGAC”), a select group of United States Attorneys who advise the Attorney General on policy matters. He served as Vice-Chair of the AGAC’s Terrorism and National Security Subcommittee, leader of the Malign Foreign Influence Working Group, and a member of the Office of Management and Budget Subcommittee. In addition to Department of Justice leadership, U.S. Attorney Buchanan was a member of the interagency Domestic Terrorism Executive Committee.
In a message to the members of his office, U.S. Attorney Buchanan said:
“Earlier today, I tendered my resignation as United States Attorney for the Northern District of Georgia to President Biden and Attorney General Garland. It is nearly impossible for me to reduce to writing my admiration and gratitude for you. You embody the high ideals of the Department of Justice, and you live out our mission daily. The Northern District, the State of Georgia, and the United States are safer because of your efforts. During my tenure as United States Attorney, the work of this office has reached six continents. At the same time, the office has remained a steadfast and engaged leader in communities from southwest Atlanta to the Appalachian foothills. That global legal work and local community impact are hallmarks of this office. Daily, we have worked collaboratively and forged lasting partnerships with law enforcement agencies and community stakeholders, leading to innovative, thoughtful, and effective approaches to advancing safety, upholding the rule of law, and protecting civil rights for nearly eight million people in the Northern District. The talent, excellence, and integrity of this office are unparalleled. It has been the privilege of my life to serve with you as colleagues, and I am forever grateful and honored to call you my friends.”
Under Mr. Buchanan’s leadership, the Northern District of Georgia achieved noteworthy successes outlined below in criminal and civil cases. U.S. Attorney Buchanan created a new dedicated section, the Public Integrity & Civil Rights Section, to formalize and expand the office’s civil and criminal civil rights work. And as described further below, Mr. Buchanan initiated and spearheaded many innovative collaborations with law enforcement and community stakeholders.
Notable Violent Crime and National Security Achievements
- A five-member minor sex trafficking group was prosecuted and sentenced, following a report that a minor victim had gone missing in Miami, Florida. The victim’s parents realized she failed to board a flight to Honduras. The minor was transported by two defendants to Georgia and forced to commit commercial sex acts and participate in “sex parties” hosted by other members of the group. The court imposed sentences ranging from seven to 30 years in prison.
- A jury convicted Jalal Hajavi for conspiring to violate the International Emergency Economic Powers Act and the Iranian Transactions and Sanctions Regulations, smuggling goods from the U.S., unlawfully exporting and reexporting goods from the U.S. to Iran without a license, and unlawfully engaging in transactions and dealings based on his participation in a scheme to unlawfully export heavy equipment from the U.S. to Iran by routing the shipments through the United Arab Emirates. He was convicted by a jury, and subsequently sentenced to two years in prison.
- Kenny Wells made headlines when he recklessly discharged a firearm at Hartsfield–Jackson Atlanta International Airport on the busy weekend before Thanksgiving in 2021. His unlawful actions created enormous panic throughout the airport and forced a lockdown of the facility and surrounding area for hours after he discharged a firearm detected inside a bag he had carried into an airport security screening area. Wells was sentenced to 10 years in prison for possessing a firearm after having been previously convicted of multiple felony offenses.
- A jury convicted Mezemr Abebe Belayneh for fraudulently obtaining U.S. citizenship by concealing his involvement in the “Red Terror,” a campaign of oppression and mass killings committed in Ethiopia that began in 1976. The Red Terror was a campaign of brutal violence in which Ethiopia’s ruling military council and its supporters detained, interrogated, tortured, and executed thousands of perceived opponents, many of whom were teenagers, based on their political opinions. Belayneh was convicted of fraudulently obtaining U.S. citizenship by lying about his role in the Red Terror persecutions and was sentenced to three years in prison.
Fraud Convictions
- Operation Five Fingers, a Priority Transnational Organized Crime case, resulted in the convictions of 40 defendants. Thirty-one of the defendants were convicted of conspiring to launder the proceeds of romance fraud schemes, bank account takeover schemes, and business email compromise schemes, which caused more than $30 million in losses to hundreds of individuals, banks, and other companies. Nine of the defendants committed bank fraud and aggravated identity theft offenses when they posed as bank customers and fraudulently withdrew funds directly from victims’ bank accounts. Two of the defendants were bank employees who facilitated laundering of fraud proceeds.
Accomplishments in Civil Cases
- A federal jury found that Charles Adams M.D. and his medical practice violated the False Claims Act (FCA). The jury concluded that the defendants violated the FCA by submitting false claims to Medicare for reimbursements of chelation therapy, which involves the use of drugs to remove heavy metals from the body. The jury found that Medicare reimbursed the defendants more than $1.1 million for these unnecessary treatments. In a post-trial ruling, the federal district judge added penalties to the jury’s verdict, bringing defendants’ total liability to more than $27 million.
- UBS AG and several of its U.S.-based affiliates (together, “UBS”) agreed to pay $1.435 billion in penalties to settle a civil action alleging misconduct related to UBS’ underwriting and issuance of residential mortgage-backed securities in 2006 and 2007.
Narcotics Convictions
- Gilberto Lopez-Giraldo, Raul Lopez-Giraldo, Guillermo Escobar, and Alexander Duque-Casanova were convicted for engaging in a more than $1.4 million drug money laundering conspiracy involving major cities from across the United States, including Atlanta, Chicago, and New York to Cali, Colombia. The defendants received sentences of incarceration ranging from three to six years.
Money Laundering & Asset Recovery
- The District’s Money Laundering & Asset Recovery Section secured more than $90 million in collections for victims of crimes and to satisfy debts owed to the United States; shared in the collection of an additional $1 billion related to financial wrongdoing; and forfeited over $55 million in property seized from criminal defendants and in civil forfeiture matters.
Public Integrity and Civil Rights Work
- Former Clayton County Sheriff Victor Hill was convicted of intentionally violating the civil rights of six pre-trial detainees by ordering them strapped into restraint chairs at the Clayton County Jail for hours without legal justification. Hill was sentenced to one year, six months in prison, which he later appealed. The Court of Appeals affirmed his convictions with an opinion that opened with U.S. President Theodore Roosevelt’s declaration: “No man is above the law and no man is below it.”
- A multi-year investigation of corruption throughout the upper echelon of the City of Atlanta’s government led to the prosecutions of 11 high-ranking city officials and contractors resulting in two convictions at trial and nine by guilty pleas. The charged conduct included bribery, theft, tax fraud, wire fraud, and money laundering offenses, but also machine gun possession, obstruction of justice, and the delivery of envelopes of cash to one of the defendants in a men’s room at a local restaurant. This investigation ultimately included convictions of the City’s Chief Financial Officer, Chief Procurement Officer, Watershed Commissioner, Director of Human Services, and Director of Contract Compliance, as well as the former Mayor’s Deputy Chief of Staff and multiple primary contractors.
- A settlement agreement was reached with Smarter Kids Child Care (“Smarter Kids”) in Smyrna, Georgia, to resolve allegations that Smarter Kids violated the Americans with Disabilities Act (“ADA”) by denying a child an opportunity to participate in its daycare program on the basis of his autism. Under the agreement, Smarter Kids agreed to adopt a non-discrimination policy to ensure ADA compliance and to provide mandatory training for all employees who consider requests for reasonable accommodations or make enrollment decisions. Additionally, Smarter Kids will pay $7,000 in compensation to the complainant and $1,000 to the United States as a civil penalty.
- A Civil Rights investigation into Fulton County, Georgia and the Fulton County Sheriff’s Office uncovered multiple violations of the constitutional and statutory rights of persons incarcerated at the Fulton County Jail on a routine basis and failures to adequately protect incarcerated persons from substantial risk of serious harm.
- A multi-year investigation of the Georgia Department of Corrections concluded that the incarcerated persons’ constitutional rights are being violated by failing to protect them from widespread physical violence and harm, including exposing incarcerated persons to unreasonable risk of harm from sexual abuse.
Law Enforcement and Community Outreach
U.S. Attorney Buchanan’s tenure reflects a steadfast and robust commitment to building relationships and partnerships with law enforcement agencies and community stakeholders within the District.
Mr. Buchanan partnered with the Georgia Department of Public Health Northwest Health District to host a community gathering designed to increase awareness of and connect residents to local resources available to help prevent opioid use, overdoses, and deaths. This collaboration resulted from a data-driven District initiative to address concerns related to Bartow County’s opioid deaths and the county’s age-adjusted opioid death rate. Local public health officials who participated in the initiative also noted the alarming nationwide increases in illicit fentanyl exposures in children younger than six years old as cause for critical concern.
Mr. Buchanan served as a member of the Georgians for Refuge, Action, Compassion and Education (“GRACE”) Commission which was created to combat human trafficking in the State of Georgia.
He partnered with the Department of Justice to host the inaugural Historically Black Colleges and Universities Regional Forum at Clark Atlanta University in Atlanta, Georgia.
He led the training effort with the Georgia Alliance for School Resource Officers and Educators, the Georgia Public Safety Training Center, and the Georgia Gang Investigators Association to provide an intensive law enforcement training, “G.R.E.A.T.” (Gang Resistance Education and Training), for more than 40 police officers from school systems in the District. These officers, specifically chosen by their respective agencies, serve at over 70 local schools that enroll more than 26,000 students.
Mr. Buchanan continued to partner with the Fulton County District Attorney’s Office as part of an annual Project Safe Neighborhoods Credible Messenger Youth Summer Violence Program, which provides intensive and positive youth and young adult mentorship, with a goal to reduce recidivism, promote public safety, and improve family and community engagement.
He hosted a safety briefing for houses of worship, gathering faith leaders and those involved with security at houses of worship, to provide training, education, and discussion in the areas of safety, security, security planning, hate crimes, and the growth and management of threats.
Mr. Buchanan led the creation of the Northern Georgia Fentanyl Prosecution Working Group, an innovative data-driven effort aimed at the counties in the Northern District that have been hit hardest by the opioid epidemic. The effort included a coordinated multi-agency, parcel interdiction operation that resulted in the seizure of illegal drugs and firearms being shipped through the district.
He oversaw a safety briefing for school administrators and safety officials to provide education and resources for planning, assessment, and mitigation of safety threats.
And he also organized a housing summit that focused on health and safety in HUD-assisted housing with Housing and Urban Development leadership.
“I thank President Biden for nominating me, Senators Raphael Warnock and Jon Ossoff for their recommendation and support, and Attorney General Garland for his leadership during my tenure,” said U.S. Attorney Buchanan. “It has been an honor and a privilege to serve the American people and the Northern District of Georgia.”
Pursuant to the Vacancies Reform Act, First Assistant U.S. Attorney Richard S. Moultrie, Jr. will succeed Mr. Buchanan as the Acting U.S. Attorney for the Northern District of Georgia until a successor is nominated by the President and confirmed by the United States Senate.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
U.S. Attorney Jane E. Young Announces ResignationRead the Press Release
CONCORD – United States Attorney Jane E. Young announced today that she is resigning on January 17, 2025. She has served in the position since May 2, 2022.
U.S. Attorney Young was nominated by President Joseph R. Biden on January 26, 2022, and confirmed by the United States Senate on April 27, 2022. Prior to her confirmation as United States Attorney, U.S. Attorney Young served as the New Hampshire Deputy Attorney General.
In addition to her duties as the Chief Federal Law Enforcement Officer in the District of New Hampshire, U.S. Attorney Young served on the United States Attorney General’s Advisory Committee’s Subcommittees on (1) Civil Rights, (2) White Collar Fraud, and (3) Law Enforcement Coordination, Victim Assistance and Community Relations (LEVC).
“As a born and raised Granite Stater, I am honored to have served the people of New Hampshire as the United States Attorney. After more than thirty years as a prosecutor in New Hampshire, I continue to be awed by the unwavering dedication and commitment to justice exhibited by law enforcement officers, prosecutors, and staff who support the tireless work of keeping our communities safe,” said U.S. Attorney Jane E. Young. “Over the past two and a half years, law enforcement in the Granite State prioritized investigating those who illegally possessed firearms, made threats to government officials and schools, exploited our most vulnerable citizens, as well as defrauded pandemic-relief and other federal programs. I am particularly proud of the education we provided community members and the private sector on emerging frauds and scams, the expansion of the United States Attorney’s Office to include two additional prosecutors focused on civil rights and violent crimes, and the restitution orders obtained to make fraud victims whole. I also want to especially thank United State Senators Jeanne Shaheen and Maggie Hassan for placing their trust in me when recommending me for this role.”
During U.S. Attorney Young’s tenure, the U.S. Attorney’s Office prosecuted a variety of complex federal crimes, including drug trafficking, financial fraud, elder and child exploitation, and violent crime. Among these cases include:
Financial Fraud
U.S. v. Ian Freeman, a Keene man was sentenced to 8 years in federal prison for laundering over ten million dollars in proceeds of romance scams and other internet fraud by exchanging U.S. dollars for Bitcoin. The defendant was ordered to pay restitution totaling $3,502,708.62 to 29 victims of his offense.
U.S. v. Pierre Rogers and Joshua Leavitt, two finance professionals were sentenced to more than 3 years and more than 2 years in federal prison, respectively, for committing wire fraud and bank fraud in connection with $6 million in attempted CARES Act loans. Rogers went on a lavish spending spree with the funds, buying a Porsche and Rolls Royce, and luxury items from retailers such as Cartier, Bulgari, and Bottega Veneta.
Bringing in or Harboring Certain Aliens
U.S. v. Abraham Hernandez, a New York man was sentenced to 6 months in federal prison in connection with transporting nine illegal immigrants in Pittsburg, New Hampshire. This was the first successful prosecution of alien smuggling in the District of New Hampshire within the past twenty years, according to U.S. Customs and Border Protection.
Project Safe Childhood
U.S. v. Michael Chick, a former school bus driver was sentenced to 9 years in federal prison for cyberstalking an eight-year-old child on his bus route.
U.S. v. Chad Lawlor, a repeat sex offender was sentenced to 25 years in federal prison in connection with administering an online chat group devoted to the sexual exploitation of children and the exchange of child sexual abuse material.
U.S. v. John E. Murray III, a manager at West Alton Marina on Alton Bay was sentenced to 25 years in federal prison for soliciting minor employees of the marina for sexually explicit images and videos of themselves, often in exchange for money. He also subjected minor employees to unwanted sexual contact and sexual acts.
Violent Crime
In 2023, U.S. Attorney Young advocated for and was awarded an additional Assistant United States Attorney position dedicated to prosecuting violent crimes.
U.S. v. Justin Gebo, a former Belmont man was sentenced to nearly 3 years in federal prison for possession of firearms as a prohibited person. The defendant was prohibited from possessing a firearm by being in possession of a firearm while under indictment and being a felon in possession of a firearm. One of the firearms that the defendant unlawfully possessed was subsequently recovered during a homicide investigation in Franklin, New Hampshire.
U.S. v. Kyle Hendrickson, a Maine man was sentenced to more than 3 years in federal prison for threatening the Portsmouth High School. He posted a video on SnapChat, in which he brandished a handgun while in a vehicle outside of the high school. The video included a text overlay that read “imma shoot up the school.” The defendant was also ordered to pay $21,946 in restitution to Portsmouth School District.
U.S. v. Robert Reidy, a Nashua man was sentenced to more than 7 years in federal prison for the illegal possession of ghost guns and ammunition and possessing unregistered firearms. At the time of his arrest, the defendant refused multiple commands to exit his residence, and ultimately surrendered after chemical munitions were deployed into his residence.
Additionally, the United States Attorney’s Office focused on civil rights violations and enforcement actions. Among these cases include:
Controlled Substances Act
U.S. v. Cheshire Medical Center, Cheshire Medical Center in Keene agreed to pay $2 million to resolve allegations that it violated the Controlled Substances Act by failing to keep accurate records of controlled substances, including opioids, after a nurse stole twenty-three intravenous bags of fentanyl solution from an automatic medication dispensing machine. This was one of the largest settlements of drug diversion claims against a hospital in the country.
U.S. v. Catholic Medical Center, Catholic Medical Center in Manchester agreed to pay $300,000 to resolve allegations that it violated the Controlled Substances Act by failing to keep accurate records of controlled substances, including opioids, after a certified registered nurse anesthetist had tampered with and diverted liquid fentanyl.
Civil Rights
In 2023, U.S. Attorney Young advocated for and was awarded an additional Assistant United States Attorney position dedicated to enforcing civil rights. Since then, the United States Attorney’s Office has focused on educating community members on law enforcement’s approach to investigating and enforcing violations of civil rights. The office has reached several settlement agreements related to civil rights violations including allegations that Smitty’s Cinema in Maine and New Hampshire violated the Americans with Disabilities Act by not offering audio description devices and closed captioning devices for customers who have vision or hearing disabilities. Additionally, the U.S. Attorney’s Office settled allegations that Manchester landlords violated the Fair Housing Act when they refused to consider their tenant’s reasonable accommodation request to have a Yorkshire terrier mix, as an Emotional Support Animal, reside with her.
In addition to case work, under United States Attorney Young’s leadership, the U.S. Attorney’s Office strengthened and expanded law enforcement partnerships, community outreach efforts, and accessibility to public information. Since May 2022, among other actions, the U.S. Attorney’s Office utilized federal programs and national expertise to offer 18 law enforcement trainings at no-cost to the U.S. Attorney’s Office in the District of New Hampshire or police departments. These trainings focused on strengthening New Hampshire law enforcement’s understanding of legal, investigative, and effective community policing topics, including trainings on Miranda warnings, dark web investigations, pre-indicators of violent assault, suicide prevention for all layers of law enforcement, and best practices for engaging with faith-based communities. The U.S. Attorney’s Office has also become a leader in addressing emerging public safety concerns, such as elder fraud and scams, bank fraud, and hate crimes, by participating in more than 30 community awareness events.
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Statement on Bourbon Street Attack in New Orleans from United States Attorney Duane A. EvansRead the Press Release
NEW ORLEANS - On behalf of the men and women of the U.S. Attorney’s Office for the Eastern District of Louisiana, I would like to express and extend my heartfelt thoughts, prayers, and condolences to the victims of yesterday’s violent, heinous and calculated acts. These same sentiments we likewise extend to the valiant law enforcement officers who risked their lives to protect the public.
The United States Department of Justice and our office, standing alongside our federal, state and local law enforcement partners, have also been hard at work protecting the public.
Our current role in this situation is to provide counsel and guidance and legal resources to our fellow law enforcement agencies as part of the ongoing investigation. In that regard, we have assembled Assistant U.S. Attorneys, at all levels, from our office in addition to a Department of Justice National Security Division prosecutor, as force multipliers during this difficult period. Since yesterday morning, this team worked diligently at command stations situated within our office and FBI New Orleans.
Since this situation remains fluid, we remind everyone to be aware, and most importantly, to be safe.
Anyone with information, photos, or video should call the FBI at 1-800-CALL-FBI or visit www.fbi.gov/bourbonstreetattack.
St. Peters Man Sentenced to 14 Years in Prison for Selling Fentanyl that Killed One Woman, Hospitalized AnotherRead the Press Release
ST. LOUIS – U.S. District Judge Sarah E. Pitlyk on Thursday sentenced a man who sold the fentanyl that killed one woman and sent another to the hospital in one day in 2019 to 14 years in prison.
Zachary Hovis, 24, provided fentanyl to an 18-year-old woman in the parking lot of a country club in Weldon Spring, Missouri on Nov. 16, 2019. The victim, who was Hovis’ close friend, drove to the parking lot of a nearby business, where she was found unconscious about an hour and 15 minutes later. She died despite a bystander’s attempt to administer naloxone. A medical examiner later determined that the immediate cause of the victim’s death was fentanyl intoxication.
Later that day, Hovis supplied fentanyl to another person who reported that she thought she was buying the painkiller oxycodone. That woman later went to the hospital, believing she was overdosing. She was treated and released.
In court Thursday, Assistant U.S. Attorney Tiffany Becker said Hovis advertised drugs for sale on social media, posted pictures of his cash profits, reached out to the 18-year-old offering drugs on the day that she died and continued to sell drugs after the death of his friend.
“The sentencing of a man who dealt drugs and killed someone brings some justice to the victim’s family and friends,” said Assistant Special Agent in Charge Colin Dickey, head of Drug Enforcement Administration operations in Eastern Missouri. “Overdose death cases are difficult to prove. Fortunately, we have great partners like the St. Charles County Drug Task Force and other state and local partners, and this kind of end result is our reward for the hard work.”
Hovis pleaded guilty in June in U.S. District Court in St. Louis to two counts of distribution of fentanyl.
The Drug Enforcement Administration and the St. Charles County Drug Task Force investigated the case. Assistant U.S. Attorneys Tiffany Becker and Cassandra Wiemken prosecuted the case.
Sioux City Woman Sentenced for Meth ConspiracyRead the Press Release
Amy Parks, 57, from Sioux City, Iowa pled guilty in federal court in Sioux City, on June 27, 2024, to one count of conspiracy to distribute methamphetamine and one count of possession of a firearm during and in furtherance of a drug trafficking crime. Parks was sentenced January 2, 2025, to 102 months’ imprisonment.
At the plea and sentencing hearings evidence showed that Parks was involved in a conspiracy from January 2021 through June 2023, that distributed ten pounds of methamphetamine. Evidence showed that on seven occasions in 2023 Parks participated in the distribution of ¼ to ½ pound of methamphetamine to an individual cooperating with law enforcement. On June 19, 2023, upon arrest of Parks, law enforcement searched her residence and seized approximately 2 ounces of methamphetamine, digital scales, drug use/distribution paraphernalia, cash, and a loaded 9mm firearm. Parks further admitted possessing the handgun in furtherance of her drug trafficking conduct.
Sentencing was held before United States District Court Judge Leonard T. Strand. Parks was sentenced to 102 months’ imprisonment and must serve a three-year term of supervised release. There is no parole in the federal system. Parks remains in custody of the United States Marshal until she can be transferred to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 23-4042. Follow us on X @USAO_NDIA.
Repeat Offender Sentenced to 10 Years in Prison for Possessing Child Sexual Abuse MaterialRead the Press Release
PORTLAND, Maine: A Lisbon Falls man was sentenced today in U.S. District Court in Portland for possessing child sexual abuse material.
U.S. District Judge Nancy Torresen sentenced Joseph Gibson, 36, to 10 years in prison followed by eight years of supervised release. He was also ordered to pay $9,000 in restitution.
According to court records, an IP address registered to Gibson’s residence was identified as downloading child sexual abuse material in September and October of 2023 via BitTorrent. In December 2023, the Maine State Police executed a search warrant at the residence, and during an interview, Gibson admitted to viewing child sexual abuse material online. Investigators with Homeland Security Investigations (HSI) analyzed two devices seized from the residence and recovered five video files of children younger than 12 being sexually abused. Gibson has two prior state convictions, in January 2010 and December 2011, relating to possessing and distributing child sexual abuse material.
The Maine State Police and HSI investigated the case.
To report an incident involving the possession, distribution, receipt or production of child pornography: Child sexual abuse material – referred to in legal terms as "child pornography" – captures the sexual abuse and exploitation of children. These images document victims’ exploitation and abuse, and they suffer revictimization every time the images are viewed. In 2023, the National Center for Missing & Exploited Children received 36 million reports of the possession, manufacture, or distribution of child sexual abuse materials. To file a report with NCMEC, go to https://report.cybertip.org or call 1-800-843-5678. If you are in Maine and you or someone you know has been sexually assaulted or abused, you can get help by calling the free, private 24-hour statewide sexual assault helpline at 1-800-871-7741.
Project Safe Childhood: 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 Department’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, visit https://www.justice.gov/usao-me/psc.
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Philadelphia Men Sentenced to Prison for 2022 Armed Robbery, Shooting of Victim in West PhiladelphiaRead the Press Release
PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Naim Newsome-Bostick, 27, and Nadir Gray, 22, both of Philadelphia, Pa., have been sentenced to prison by United States District Court Judge Mark A. Kearney, for one count of attempted Hobbs Act robbery.
Judge Kearney sentenced Newsome-Bostick today to 160 months in prison, three years of supervised release, and a $100 special assessment, and, in December, sentenced Gray to 92 months in prison, three years of supervised release, and a $100 special assessment.
Newsome-Bostick and Gray were charged by superseding indictment in September 2023. In July of last year, both pleaded guilty to robbing a man they believed to be a marijuana dealer on September 14, 2022, in West Philadelphia. As part of their plea, the defendants admitted that the robbery was carried out at gunpoint.
Newsome-Bostick and Gray forced the victim into their vehicle at gunpoint, then robbed him of his Rolex watch, wallet, and $3,000. As the defendants drove around, the victim began resisting and fighting with one of the men in the back. Amid the commotion, the defendants’ vehicle crashed into a parked car. Newsome-Bostick shot the victim three times, then he and Gray fled the scene. Philadelphia police officers responded and transported the victim to hospital, where he was treated, eventually recovering from his wounds.
Newsome-Bostick was arrested later that day by the Philadelphia Police Department and Gray was arrested in September 2023 by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
“Anyone who thinks they can carry out an armed robbery in this city and get off scot-free should take a good look at this case,” said U.S. Attorney Romero. “My office, the ATF, and the Philadelphia Police Department will continue to prioritize and prosecute these violent crimes — no matter who the victim may be — and we’ll see to it that the perpetrators are held accountable.”
“For the sake of some cash and a watch, these criminals kidnapped their victim at gun point, threatened his life, and shot him three times!" said Eric DeGree, Special Agent in Charge of the ATF's Philadelphia Field Division. “The victim is lucky to be alive, and the defendants are lucky to not be facing murder charges. Working with our law enforcement partners, ATF will continue to bring justice for the victims of violent crime and help make our communities safer for all.”
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
The case was investigated by the ATF and the Philadelphia Police Department and is being prosecuted by Assistant United States Attorneys Robert E. Eckert and Jason D. Grenell.
Pennsylvania Man Who Traveled to Lebanon and Syria with Goal of Joining Hizballah Indicted on Terrorism Offense and for Lying to FBIRead the Press Release
Jack Danaher Molloy, 24, a former resident of Pittsburgh, Pennsylvania, has been indicted by a grand jury on charges of attempting to support the foreign terrorist organization Hizballah and making false statements involving international terrorism to a department or agency of the United States.
Molloy was previously charged by criminal complaint with making false statements on Dec. 6, 2024, with much of the conduct underlying the charges in the indictment set forth in the complaint. Molloy was arrested in Chicago, Illinois, on Dec. 6, 2024, and transported by the U.S. Marshals Service to Pittsburgh on Dec. 30, 2024.
As alleged in the indictment and complaint, from in and around August 2024 through in and around December 2024, in Lebanon, Syria, the Western District of Pennsylvania, and elsewhere, Molloy attempted to provide material support and resources—namely, personnel (including himself) and services — to Hizballah, a foreign terrorist organization (FTO), knowing that the organization was a designated terrorist organization and that the organization had engaged in and was engaging in terrorist activity and terrorism. As outlined in the court documents, Hizballah, also commonly spelled Hezbollah, was formed in the wake of the 1982 Israeli invasion of Lebanon and has conducted numerous terrorist attacks against Israeli and Western targets, including against American military and diplomatic personnel.
As alleged, Molloy — a dual citizen of the United States and Ireland, who previously served on active-duty status in the U.S. Army — traveled to Lebanon in August 2024 and attempted to join Hizballah. While in Lebanon, Molloy was told by multiple individuals that the time was not right, and that he needed to take other steps before he could join the terrorist organization. Molloy then traveled from Lebanon to Syria in October 2024 in an effort to fight for Hizballah in Syria. After returning to the United States, Molloy resided in Upper St. Clair, where he continued his attempts to join Hizballah, including through communication with individuals online and in Lebanon. During his time in the United States and abroad, Molloy also allegedly expressed his hatred toward, and promoted violence against, Jewish people. Molloy’s alleged animus toward Jews was also evidenced by multiple images and videos on his electronic devices and the usernames he chose for his social media and email accounts, including the username “KIKEKILLER313” on the social media platform X. In one alleged WhatsApp exchange with a family member, Molloy agreed that his “master plan was to join Hezbollah and kill Jews.” And while he was residing in Upper St. Clair, Molloy also allegedly visited a website detailing the possible incarceration location of Robert Bowers, who carried out the Pittsburgh Tree of Life Synagogue shooting during which he murdered 11 Jewish worshippers.
The indictment further alleges that, upon arriving at the Pittsburgh International Airport on Oct. 20, 2024, Molloy lied to agents of the FBI when he told them (1) that he had no current or future plans to become involved with Hizballah, and (2) that he had no business in, nor was he meeting with anyone, in Syria. These statements and representations were false because Molloy knew at that time that (1) he did have current and future plans to become involved with Hizballah and (2) Molloy travelled to Syria in furtherance of his attempts to join Hizballah, and while in Syria, set up a meeting with an individual there.
If convicted, Molloy faces a maximum penalty of 20 years in prison for material support charge. For false statement charges, he faces a maximum penalty of eight years in prison, a $250,000 fine, or both. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI Pittsburgh and Chicago Field Offices are investigating the case with substantial assistance from the U.S. Marshals Service.
Assistant U.S. Attorney Nicole Vasquez Schmitt of the Western District of Pennsylvania and Trial Attorney Andrew Briggs of the National Security Division’s Counterterrorism Section are prosecuting the case.
An indictment and criminal complaint are merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
New York Man Sentenced for Violating Federal Sex Offender Registration and Notification ActRead the Press Release
CHARLESTON, W.Va. – Elliot J. Santiago, 25, of Brooklyn, New York, was sentenced today to time served and five years of supervised release for failure to provide information related to interstate travel as required by the Sex Offender Registration and Notification Act (SORNA).
According to court documents and statements made in court, Santiago was required to comply with the provisions of SORNA because of his conviction for first-degree sexual abuse in Monongalia County Circuit Court on August 28, 2019. From on or about May 30, 2023 to on or about October 25, 2023, Santiago failed to provide notification that he had traveled from Charleston, West Virginia, to Toledo, Ohio and then to Brooklyn, New York.
United States Attorney Will Thompson made the announcement and commended the investigative work of the United States Marshals Service (USMS).
Santiago served approximately one year and two months in custody. United States District Judge Thomas E. Johnston imposed the sentence. Assistant United States Attorney Jonathan T. Storage prosecuted the case.
SORNA is part of the Adam Walsh Child Protection and Safety Act of 2006 and provides a comprehensive set of minimum standards for sex offender registration and notification in the United States. SORNA seeks to strengthen the nationwide network of sex offender registration and notification programs, in part by requiring registered sex offenders to register and keep their registration current in each jurisdiction in which they reside, work, or go to school.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:23-cr-174.
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New Haven Psychiatrist to Pay More Than $450K to Settle False Claims Act and Controlled Substances Act AllegationsRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, Roberto Coviello, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of the Inspector General, Stephen Belleau, Acting Special Agent in Charge of the Drug Enforcement Administration for New England, and Connecticut Attorney General William Tong today announced that NAIMETULLA AHMED SYED, M.D. has entered into a civil settlement agreement with the federal and state governments and agreed to pay $455,439.26 to resolve allegations that he violated the federal and state False Claims Acts and the civil provisions of the Controlled Substances Act (“CSA”) relating to his issuance of medically unnecessary controlled substances prescriptions.
Syed is licensed as a doctor of psychiatry and was the sole practitioner at his medical offices in Danbury and New Haven. It is alleged that, between June 2016 and June 2021, Syed issued medically unnecessary prescriptions – including prescriptions for controlled substances – for which Syed caused false claims to be submitted by Cornerstone Pharmacy, Inc. (doing business as “Whalley Drug”) in New Haven to Medicare and Medicaid for those medically unnecessary prescriptions. Syed also billed Medicare and Medicaid for medically unnecessary office visits related to those medically unnecessary prescriptions.
In addition, it is alleged that Syed issued prescriptions for controlled substances without a legitimate medical purpose and not in the usual course of professional practice, in violation of Syed’s obligations under the CSA. Syed issued prescriptions for excessive and unsafe amounts of benzodiazepines; for controlled substances to individuals displaying red flags of abuse, addiction, or diversion, including to individuals who received dangerous combinations of controlled substances (including the high-risk “holy trinity” drug combination of at least one opioid, benzodiazepine, and a muscle relaxant); and to an individual for buprenorphine, a synthetic opioid that can be used to treat opioid use disorders, at the same time that this individual was receiving oxycodone and hydrocodone from other providers. He also failed to maintain adequate treatment records, and maintained patient files devoid of any information documenting an examination or reasons for the prescriptions, or establishing a doctor-patient relationship.
On June 16, 2021, Syed voluntarily surrendered his DEA licenses.
In addition to making payment of $455,439.26 under the civil settlement agreement, Syed agreed to a 20-year exclusion from Medicare, Medicaid, and all other federal health care programs, as well as a 20-year suspension from the Connecticut Medical Assistance Program. Syed also entered into an agreement with the Connecticut Department of Public Health in which he agreed to cease the practice of medicine as of November 25, 2024, and to not renew his physician license, which expires this month.
In 2016, Syed paid $422,641.70 to resolve federal and state allegations that he submitted false claims for psychotherapy services to Medicare and Medicaid.
In April 2024, Cornerstone Pharmacy (d/b/a Whalley Drug) and its owner, Yong Kwon, paid $120,000 to resolve allegations that they violated the CSA by filling invalid prescriptions. Kwon voluntarily surrendered the DEA license for Whalley Drug, which no longer operates as a retail pharmacy, on June 22, 2021, after the DEA’s execution of an Administrative Inspection Warrant.
This investigation was conducted by the Office of Inspector General for the Department of Health and Human Services, DEA’s Office of Diversion Control, and the DEA New Haven’s Tactical Diversion Squad, with the assistance of the Connecticut Department of Consumer Protection, Drug Control Division. This case was prosecuted by Assistant U.S. Attorneys Sarah Gruber and David Nelson, and by Deputy Associate Attorney General Gregory O’Connell of the Connecticut Office of the Attorney General.
People who suspect health care fraud are encouraged to report it by calling 1-800-HHS-TIPS.
Missoula man sentenced to more than 19 years in prison for trafficking meth, fentanyl in communityRead the Press Release
MISSOULA — A Missoula man who admitted to distributing pounds of methamphetamine and thousands of fentanyl pills that were shipped from Washington was sentenced today to 19 years and seven months in federal prison, to be followed by five years of supervised release, U.S. Attorney Jesse Laslovich said.
The defendant, Alejandro Romero, 36, pleaded guilty in August 2024 to possession with intent to distribute controlled substances.
U.S. District Judge Dana L. Christensen presided.
“We won’t make progress against our nation’s drug epidemic unless the biggest drug traffickers are held accountable, which we’ve done today. Romero is responsible for peddling pounds and pounds of meth and thousands of fentanyl pills, including pink pills, as well as distributing fentanyl powder. His lengthy federal prison sentence shows we are determined to make the progress Montanans expect and deserve regarding drug traffickers poisoning our communities,” U.S. Attorney Laslovich said.
The government alleged in court documents that from December 2023 through March 2024 in Missoula, Romero possessed fentanyl, and meth for distribution. During the sentencing hearing, the court noted that Romero was distributing fentanyl, including pink fentanyl. Pink fentanyl is a more potent form of the drug. One individual purchased approximately two pounds of meth directly from Romero in separate transactions and also purchased fentanyl pills and heroin from him. The individual also witnessed Romero in his hotel room and in possession of thousands of fentanyl pills, pounds of powdered fentanyl, 10 pounds of meth, which is the equivalent of approximately 36,240 doses, and a little more than two pounds of heroin. Another individual received approximately 1,000 fentanyl pills in Washington in a drug transaction that Romero arranged and had fronted the individual $3,000 to obtain the pills. When interviewed Romero admitted that he distributed in Montana large quantities of meth and fentanyl that had been shipped from Washington.
The U.S. Attorney’s Office prosecuted the case. The FBI’s Montana Regional Violent Crime Task Force and Missoula Police Department conducted the investigation.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. For more information about Project Safe Neighborhoods, please visit Justice.gov/PSN.
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Leadership Transition at U.S. Attorney’s Office for the District of ColoradoRead the Press Release
Denver – The United States Attorney’s Office for the District of Colorado announces that United States Attorney Matthew T. Kirsch and Deputy United States Attorney Andrea Wang are resigning their positions effective no later than midnight on January 25, 2025.
“I’ve been incredibly honored to serve the United States and the people of Colorado through over twenty-five years of work at the Department of Justice. I will be forever grateful for the opportunity to work with my colleagues here and to lead this office,” said United States Attorney Matt Kirsch. “The office will continue to be led by highly accomplished and experienced attorneys, and I am confident they will carry on the office’s long-standing commitment to justice in the District of Colorado.”
Mr. Kirsch has accepted the position of First Assistant District Attorney with the Denver District Attorney’s Office.
First Assistant U.S. Attorney J. Bishop Grewell will serve as Acting United States Attorney upon the effective date of Mr. Kirsch’s resignation. Mr. Grewell joined the Department of Justice in 2010 and has been with the District of Colorado since 2013. He currently serves as Chief of the Appellate Division.
President-Elect Donald Trump is expected to nominate a new United States Attorney for the District of Colorado in the coming months.
LabCorp and University Health System Agree to Pay $388,667 to Resolve Alleged False Claims Act ViolationsRead the Press Release
KNOXVILLE, Tenn. – Laboratory Corporation of America Holdings (“LCAH”), Laboratory Corporation of America (“LCA”), Labcorp Tennessee, LLC (“LCTN”) (collectively, “LabCorp”), and University Health System, Inc. (“UHS”) have paid $388,667.17 to resolve allegations that they violated the False Claims Act by delaying the submission of physician orders for certain laboratory tests by Caris Life Sciences, Inc. (“Caris”) to enable improper billings to Medicare for those tests.
During the relevant timeframe, Medicare’s Date of Service or “14-Day” Rule prohibited laboratories from separately billing Medicare for tests performed on specimens if a physician ordered the test within 14 days of the patient’s discharge from a hospital stay either in an outpatient or inpatient setting. If the test was performed more than 14 days after discharge, then Medicare’s 14-Day Rule permitted laboratories to bill Medicare directly for the test. If the test was performed within the 14-day window, the laboratory must instead bill the hospital facility.
UHS operates University of Tennessee Medical Center (“UTMC”), and LCA provides clinical laboratory services through LCTN at UTMC’s outpatient laboratory. According to filed documents, between March 2012 and November 2023, UHS and LCTN caused the delay of the submission of physician orders for Caris testing, by either holding orders for submission or cancelling and resubmitting orders, until 14 days after a Medicare beneficiary’s discharge from the hospital to circumvent Medicare’s Date of Service Rule, which allowed the submission of claims to Medicare. The United States contends that, in doing so, UHS and LCTN violated the Date of Service Rule and knowingly caused the submission of false claims for reimbursement to Medicare. UHS and LabCorp cooperated with the United States’ investigation and resolution thereof. Caris, for its part, previously agreed to pay $2.8M to resolve allegations in the Eastern District of New York of its related conduct on a nationwide scale.
This settlement resolves, in part, a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permits private parties to sue on behalf of the government for false claims and receive a share of any recovery. The qui tam case is captioned United States ex rel. Kim Vo v. Caris Life Sciences, Inc. et al., No. 3:20-CV-509 (E.D. Tenn.). Relator Kim Vo received $73,846.76 of the proceeds from the settlement. UHS was not a party to the qui tam case but participated in the settlement.
The investigation and resolution of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to HHS at 800-HHS-TIPS (800-447-8477).
Assistant U.S. Attorneys Alexa Ortiz Hadley and Jeremy S. Dykes represented the United States, with assistance from the Department of Health and Human Services’ Office of Inspector General and Trial Attorney Robert C. K. Boyd of the Department of Justice’s Civil Division, Fraud Section.
The claims resolved by this settlement are allegations only, and there has been no determination of liability.
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Holyoke, Massachusetts Man Sentenced to 85 Months in Armed Drug Trafficking CaseRead the Press Release
Burlington, Vermont – The United States Attorney’s Office for the District of Vermont stated that on December 23, 2024, Javon Calderon, 21, of Holyoke, Massachusetts, was sentenced by Chief United States District Judge Christina Reiss to a term of 85 months’ imprisonment to be followed by an 8-year term of supervised release. Calderon previously pleaded guilty to conspiracy to distribute fentanyl and cocaine and to using and carrying a firearm during and in relation to a drug trafficking crime.
According to court records, Calderon and co-defendant Christopher Morgan spent substantial time in Bennington, Vermont, in 2022 distributing fentanyl and cocaine. During a portion of that time, Calderon and Morgan were hosted by co-defendants and Bennington residents Shavonne Doucette and Kyle Winnie. Calderon and Morgan employed locals to sell drugs for them. Doucette and Winnie also occasionally sold drugs for Calderon and Morgan.
In early September 2022, inside the Doucette/Winnie residence, Calderon and Morgan threatened with firearms and assaulted one such local distributor over a drug debt. Portions of the assault were captured on video and depicted Calderon striking and threatening the victim and holding a firearm to the victim’s neck while making threats. The video also depicted Morgan pointing a firearm at the victim and issuing threats. The victim sustained scalp injuries that required staples.
Like Calderon, Morgan has pleaded guilty to conspiracy to distribute fentanyl and cocaine and to using and carrying a firearm during and in relation to a drug trafficking crime. Morgan’s sentencing is scheduled for March 13, 2025. Doucette and Winnie have pleaded guilty to making their residence available for the distribution of fentanyl and cocaine. Doucette’s sentencing is set for January 21, 2025, and Winnie’s sentencing is set for February 18, 2025.
United States Attorney Nikolas P. Kerest commended the collaborative investigatory efforts of Homeland Security Investigations (HSI), the HSI Special Response Team, the Vermont State Police, the Bennington Police Department, the Bennington County Sheriff’s Department, the Rutland City Police Department, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
The case was prosecuted by Assistant U.S. Attorney Corinne Smith. Calderon was represented by Devin McKnight, Esq; Morgan is represented by Peter Langrock, Esq.; Doucette is represented by Brooks McArthur, Esq.; Winnie is represented by Jordana Levine, Esq.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. For more information about Project Safe Neighborhoods, please visit Justice.gov/PSN.
Former teacher going to prison for possession of child pornographyRead the Press Release
BUFFALO, N.Y.-U.S. Attorney Trini E. Ross announced today that Anthony V. Giambrone, 41, of Kenmore, NY, who was convicted of possession of child pornography involving prepubescent minors, was sentenced to serve 60 months in prison by U.S. District Judge Richard J. Arcara. Giambrone was also ordered to pay restitution totaling $16,000 to victims in the case.
Assistant U.S. Attorney Aaron J. Mango, who handled the case, stated that in April 2020, Giambrone, a former teacher with Erie One BOCES working at Maryvale Intermediate School, possessed images of child pornography on two separate laptop computers. Giambrone possessed approximately 1,052 images and 381 videos of child pornography, some of which included prepubescent minors.
The sentencing is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Matthew Miraglia and the Town of Tonawanda Police Department, under the direction of Chief James Stauffiger.
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Duo Sentenced for Armed Robberies in Forsyth and Randolph CountiesRead the Press Release
GREENSBORO – Two Anson County residents who pleaded guilty to Hobbs Act robberies and firearms charges have been sentenced, announced Sandra J. Hairston, United States Attorney for the Middle District of North Carolina.
In August 2024, BRANDON DRELLE WALL, age 35, of Wadesboro, North Carolina, and WILLIAM CHAVIS DUNLAP, JR., age 29, of Morven, North Carolina, pleaded guilty to robbing a sweepstakes business in Winston-Salem in June 2022, and another in Liberty in August 2022. Each defendant also pleaded guilty to brandishing a firearm during and in furtherance of a crime of violence.
WALL was sentenced on October 30, 2024, to consecutive terms of 138 months imprisonment and 84 months imprisonment, plus 5 years supervised release.
DUNLAP was sentenced today to consecutive terms of 110 months imprisonment and 84 months imprisonment, plus 5 years supervised release.
Both sentencing hearings were held in Greensboro, North Carolina, before United States District Judge William L. Osteen, Jr. In addition to prison time, WALL and DUNLAP were ordered to pay restitution and forfeited their interests in seven firearms plus multiple magazines and rounds of ammunition.
According to court documents, WALL and DUNLAP wore masks and threatened employees with guns in an effort to gain access to business safes. During the robbery in Liberty, the defendants also forced patrons to the floor at gunpoint. WALL and DUNLAP took a phone, wallet, $1,400, and two guns in the Winston-Salem robbery. A total of $8,650 was stolen during the Liberty robbery. After his arrest, WALL admitted he also robbed a gas station in Richmond County, and DUNLAP admitted to robbing a discount store in Anson County.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
The case was investigated by the Liberty Police Department, Winston-Salem Police Department, Anson County Sheriff's Office, Richmond County Sheriff's Office, Wadesboro Police Department, Homeland Security Investigations, Bureau of Alcohol, Tobacco, Firearms and Explosives, and prosecuted by Special Assistant United States Attorney Mary Ann Courtney.
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Do Kwon Extradited to the United States from Montenegro to Face Charges Relating to Fraud Resulting in $40B in LossesRead the Press Release
Do Hyeong Kwon, 33, a citizen of the Republic of Korea, was extradited from Montenegro and appeared in court today in Manhattan to face federal fraud charges. A superseding indictment that was unsealed against Kwon alleged that the co-founder and former chief executive officer of Terraform Labs PTE Ltd. (Terraform) engaged in multiple schemes to deceive investors in order to fraudulently inflate the value of Terraform’s cryptocurrencies.
Kwon arrived in the United States on Dec. 31, 2024, and made his initial appearance before U.S. Magistrate Judge Robert W. Lehrburger for the Southern District of New York. Kwon’s case is assigned to U.S. District Court Judge John P. Cronan, and will appear before Judge Cronan for an initial conference on Jan. 8 at 10:30 a.m ET.
“Do Hyeong Kwon will now be held accountable in an American courtroom for, as alleged in court documents, his elaborate schemes involving Terraform’s cryptocurrencies, which resulted in over $40 billion in investor losses,” said Attorney General Merrick B. Garland. “We secured this extradition despite Kwon’s alleged attempt to cover his tracks by laundering proceeds of his schemes and trying to use a fraudulent passport to travel to a country that did not have an extradition treaty with the United States. This extradition from Montenegro is an example of the Justice Department’s international partnerships, which enable the pursuit of criminals wherever they attempt to hide.”
“A federal grand jury has indicted Do Kwon for misleading his investors in order to fraudulently inflate the value of Terraform’s cryptocurrencies, and laundering the proceeds of his crimes,” said Attorney for the United States Daniel M. Gitner for the Southern District of New York. “As we allege, this fraud and the crash of Terraform’s cryptocurrencies in May 2022 erased over $40 billion in investor assets, causing devastating losses to countless investors in the United States and around the world. Kwon will now face justice in a federal courtroom in Manhattan.”
“Do Kwon, co-founder and former CEO of Terraform, allegedly defrauded investors by falsely advertising the company’s blockchain products as decentralized, reliable, and effective, and by engaging in market manipulation, ultimately resulting in more than $40 billion in investor losses,” said Assistant Director in Charge James E. Dennehy of the FBI New York Field Office. “For at least four years, Kwon allegedly played puppet master to maintain this crafted illusion and ensnare investors. The FBI will tirelessly work to apprehend any individual who engages in fraudulent financial practices, even those who flee internationally to escape prosecution.”
As alleged in the superseding indictment, from at least in or about 2018, up to and including in or about 2022, Kwon orchestrated schemes to defraud purchasers of Terraform cryptocurrencies. Among other things, Kwon made false and misleading claims regarding the stability and efficacy of Terraform’s cryptocurrency stablecoin protocol, its use of blockchain technology, and its development of functioning and reliable financial technologies.
As Kwon knew, however, core Terraform products did not work as Kwon had claimed. Rather, Kwon manipulated Terraform products to create the illusion of a functioning, stable, and decentralized financial system. Kwon’s conduct inflated the value of Terraform’s cryptocurrencies, which Kwon and entities he controlled possessed in large amounts and sold to investors in exchange for billions of dollars’ worth of other assets.
Kwon’s misrepresentations included the following:
- The Stablecoin Misrepresentations: Kwon made misrepresentations about the effectiveness of the system that lay at the heart of Terraform’s cryptocurrency empire, the “Terra Protocol,” which purportedly used a computer algorithm to maintain the value of Terraform’s so-called “stablecoin” pegged to the U.S. dollar, TerraUSD (UST), at a value of $1 for one UST. But as Kwon knew, after the Terra Protocol failed to cause the restoration of UST’s $1 peg in May 2021, Kwon reached an agreement with executives at a high-frequency trading firm (the Trading Firm) so that the Trading Firm would purchase large amounts of UST in order to artificially support UST’s $1 peg.
- The LFG Misrepresentations: Kwon made misrepresentations about the governance of the Luna Foundation Guard Ltd. (LFG), which Kwon claimed was managed by an independent governing body and was tasked with deploying billions of dollars’ worth of financial reserves to defend UST’s peg. But as Kwon knew, he controlled both the LFG and Terraform. In addition, Kwon misappropriated hundreds of millions of dollars in assets from the LFG. Kwon and others acting at his direction sought to launder those misappropriated funds through transactions designed to conceal and disguise the nature, location, source, ownership, and control of the funds.
- The Mirror Misrepresentations: Kwon made misrepresentations about the success and operation of an investing platform on Terraform’s blockchain (the Terra blockchain) called Mirror Protocol (Mirror), that purportedly allowed users to create, buy, and sell synthetic versions of stocks listed on U.S. securities exchanges. Kwon claimed that Mirror operated in a decentralized manner and that he and Terraform played no role in Mirror’s governance. But as Kwon knew, he and Terraform secretly maintained control over Mirror, and used automated trading bots to manipulate the prices of synthetic assets that Mirror issued. Kwon also caused Terraform to inflate key user metrics to deceive investors.
- The Chai Misrepresentations: Kwon falsely claimed that the Terra blockchain was being used to process billions of dollars in financial transactions for the Korean payment-processing application Chai. In doing so, Kwon claimed that the Terra blockchain had “real world” applications or uses, as distinct from competing cryptocurrency platforms. But as Kwon knew, Chai processed transactions through traditional financial processing networks, not the Terra blockchain.
- The Genesis Coin Misrepresentations: Kwon made misrepresentations about the use of a supply of one billion stablecoins programmed into the Terra blockchain at its creation (the Genesis Stablecoins), which were purportedly held in reserve for Terraform for certain specified uses. But Kwon used at least $145 million worth of Genesis Stablecoins, among other things, to fund fake Chai blockchain transactions and trading bots to manipulate the prices of synthetic assets that Mirror issued.
At its peak in the spring of 2022, the total apparent market value of all UST and another Terraform cryptocurrency, LUNA, exceeded $50 billion. Much of this growth followed Kwon’s misrepresentations about Terraform and its technology, including efforts in May 2021 by Kwon and his associates to secretly manipulate the market for UST. By May 2022, the UST market was approximately nine times larger in terms of market capitalization and more than eight times larger in terms of daily trading volume relative to May 2021. In May 2022, UST’s peg began to break down as it had a year prior. While Kwon was able to cover up the weaknesses of the Terra Protocol in May 2021, he was not able to do so in May 2022. As a result, the value of UST and LUNA crashed and investors suffered over $40 billion in losses. After the crash of UST and LUNA in May 2022, Kwon caused the distribution of a misleading “third party audit” report to cover up his crimes, and sought to launder the proceeds of his fraud through different blockchains, cryptocurrency exchanges, and a Swiss bank account.
On or about March 23, 2023, Kwon was arrested in Europe for trying to use a fraudulent passport to travel to a country that did not have an extradition treaty with the United States.
Kwon was previously charged in the Southern District of New York in an initial indictment on March 23, 2023.
Kwon is charged with two counts of commodities fraud, for which he faces a maximum penalty of 10 years in prison for each count; two counts of securities fraud, for which he faces a maximum penalty of 20 years in prison for each count; two counts of wire fraud, for which he faces a maximum penalty of 20 years in prison for each count; two counts of conspiracy to commit commodities fraud, securities fraud, and wire fraud, for which he faces a maximum penalty of five years in prison for each count; and one count of money laundering conspiracy, for which he faces a maximum penalty of 20 years in prison. If convicted of all charges, Kwon faces a maximum penalty of 130 years in prison. A federal district court judge will determine any sentence based on the U.S. Sentencing Guidelines and other statutory factors.
The FBI are investigating the case, with assistance from Trial Attorneys Jason Cunningham and Goran Krnaich of the Justice Department’s Office of International Affairs, Interpol, and the Ministry of Justice, Supreme State Prosecutor’s Office, Special State Prosecutor’s Office, and Police Directorate of Montenegro in the extradition of the defendant. The U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission also assisted in the case.
Assistant U.S. Attorneys Jared Lenow, Kimberly Ravener, and Andrew Thomas for the Southern District of New York are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Do Kwon Extradited to the United States from Montenegro to Face Charges Relating to Fraud Resulting in $40 Billion in LossesRead the Press Release
Daniel M. Gitner, Attorney for the United States, Acting under Authority Conferred by 28 U.S.C. § 515; Merrick B. Garland, the Attorney General of the United States; and James E. Dennehy, Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that DO HYEONG KWON was extradited from Montenegro and appeared in a federal courtroom in Manhattan earlier today to face federal fraud charges. Mr. Gitner also announced the unsealing of a Superseding Indictment against KWON. As alleged, KWON, the co-founder and former chief executive officer of Terraform Labs PTE, Ltd. (“Terraform”), engaged in multiple schemes to deceive investors in order to fraudulently inflate the value of Terraform’s cryptocurrencies. KWON arrived in the United States on December 31, 2024, and made his initial appearance in the Southern District of New York before U.S. Magistrate Judge Robert W. Lehrburger. KWON’s case is assigned to U.S. District Court Judge John P. Cronan, and will appear before Judge Cronan for an initial conference on January 8, 2025, at 10:30 a.m.
Attorney for the United States Daniel M. Gitner said: “A federal grand jury has indicted Do Kwon for misleading his investors in order to fraudulently inflate the value of Terraform’s cryptocurrencies, and laundering the proceeds of his crimes. As we allege, this fraud and the crash of Terraform’s cryptocurrencies in May 2022 erased over $40 billion in investor assets, causing devastating losses to countless investors in the United States and around the world. Kwon will now face justice in a federal courtroom in Manhattan.”
Attorney General Merrick B. Garland said: “Do Hyeong Kwon will now be held accountable in an American courtroom for, as alleged in court documents, his elaborate schemes involving Terraform’s cryptocurrencies, which resulted in over $40 billion in investor losses. We secured this extradition despite Kwon’s alleged attempt to cover his tracks by laundering proceeds of his schemes and trying to use a fraudulent passport to travel to a country that did not have an extradition treaty with the U.S. This extradition from Montenegro is an example of the Justice Department’s international partnerships, which enable the pursuit of criminals wherever they attempt to hide.”
FBI Assistant Director in Charge James E. Dennehy said: “Do Kwon, co-founder and former CEO of Terraform, allegedly defrauded investors by falsely advertising the company's blockchain products as decentralized, reliable, and effective, and by engaging in market manipulation, ultimately resulting in more than $40 billion in investor losses. For at least four years, Kwon allegedly played puppet master to maintain this crafted illusion and ensnare investors. The FBI will tirelessly work to apprehend any individual who engages in fraudulent financial practices, even those who flee internationally to escape prosecution.”
As alleged in the Superseding Indictment unsealed today in Manhattan federal court:[1]
From at least in or about 2018, up to and including in or about 2022, KWON orchestrated schemes to defraud purchasers of Terraform cryptocurrencies. Among other things, KWON made false and misleading claims regarding the stability and efficacy of Terraform’s cryptocurrency stablecoin protocol, its use of blockchain technology, and its development of functioning and reliable financial technologies.
As KWON knew, however, core Terraform products did not work as KWON had claimed. Rather, KWON manipulated Terraform products to create the illusion of a functioning, stable, and decentralized financial system. KWON’s conduct inflated the value of Terraform’s cryptocurrencies, which KWON and entities he controlled possessed in large amounts and sold to investors in exchange for billions of dollars’ worth of other assets.
KWON’s misrepresentations included the following:
- The Stablecoin Misrepresentations: KWON made misrepresentations about the effectiveness of the system that lay at the heart of Terraform’s cryptocurrency empire, the “Terra Protocol,” which purportedly used a computer algorithm to maintain the value of Terraform’s so-called “stablecoin” pegged to the U.S. dollar, TerraUSD (“UST”), at a value of $1 for one UST. But as KWON knew, after the Terra Protocol failed to cause the restoration of UST’s $1 peg in May 2021, KWON reached an agreement with executives at a high-frequency trading firm (the “Trading Firm”) so that the Trading Firm would purchase large amounts of UST in order to artificially support UST’s $1 peg.
- The LFG Misrepresentations: KWON made misrepresentations about the governance of the Luna Foundation Guard Ltd. (the “LFG”), which KWON claimed was managed by an independent governing body and was tasked with deploying billions of dollars’ worth of financial reserves to defend UST’s peg. But as KWON knew, he controlled both the LFG and Terraform. In addition, KWON misappropriated hundreds of millions of dollars in assets from the LFG. KWON and others acting at his direction sought to launder those misappropriated funds through transactions designed to conceal and disguise the nature, location, source, ownership, and control of the funds.
- The Mirror Misrepresentations: KWON made misrepresentations about the success and operation of an investing platform on Terraform’s blockchain (the “Terra blockchain”) called Mirror Protocol (“Mirror”), that purportedly allowed users to create, buy, and sell synthetic versions of stocks listed on U.S. securities exchanges. KWON claimed that Mirror operated in a decentralized manner and that he and Terraform played no role in Mirror’s governance. But as KNOW knew, he and Terraform secretly maintained control over Mirror, and used automated trading bots to manipulate the prices of synthetic assets that Mirror issued. KWON also caused Terraform to inflate key user metrics to deceive investors.
- The Chai Misrepresentations: KWON falsely claimed that the Terra blockchain was being used to process billions of dollars in financial transactions for the Korean payment-processing application Chai. In doing so, KWON claimed that the Terra blockchain had “real world” applications or uses, as distinct from competing cryptocurrency platforms. But as KWON knew, Chai processed transactions through traditional financial processing networks, not the Terra blockchain.
- The Genesis Coin Misrepresentations: KWON made misrepresentations about the use of a supply of one billion stablecoins programmed into the Terra blockchain at its creation (the “Genesis Stablecoins”), which were purportedly held in reserve for Terraform for certain specified uses. But KWON used at least $145 million worth of Genesis Stablecoins, among other things, to fund fake Chai blockchain transactions and trading bots to manipulate the prices of synthetic assets that Mirror issued.
At its peak in the spring of 2022, the total apparent market value of all UST and another Terraform cryptocurrency, LUNA, exceeded $50 billion. Much of this growth followed KWON’s misrepresentations about Terraform and its technology, including efforts in May 2021 by KWON and his associates to secretly manipulate the market for UST. By May 2022, the UST market was approximately nine times larger in terms of market capitalization and more than eight times larger in terms of daily trading volume relative to May 2021. In May 2022, UST’s peg began to break down as it had a year prior. While KWON was able to cover up the weaknesses of the Terra Protocol in May 2021, he was not able to do so in May 2022. As a result, the value of UST and LUNA crashed and investors suffered over $40 billion in losses. After the crash of UST and LUNA in May 2022, KWON caused the distribution of a misleading “third party audit” report to cover up his crimes, and sought to launder the proceeds of his fraud through different blockchains, cryptocurrency exchanges, and a Swiss bank account.
On or about March 23, 2023, KWON was arrested in Europe for trying to use a fraudulent passport to travel to a country that did not have an extradition treaty with the U.S.
KWON was previously charged in this District in an initial Indictment on March 23, 2023.
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KWON, 33, a citizen of the Republic of Korea, is charged with two counts of commodities fraud, each of which carries a maximum sentence of 10 years in prison; two counts of securities fraud, each of which carries a maximum sentence of 20 years in prison; two counts of wire fraud, each of which carries a maximum sentence of 20 years in prison; two counts of conspiracy to commit commodities fraud, securities fraud, and wire fraud, each of which carries a maximum sentence of five years in prison; and one count of money laundering conspiracy, which carries a maximum sentence of 20 years in prison. In aggregate, KWON faces a maximum sentence of 130 years in prison.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
Mr. Gitner praised the investigative and operational work of the FBI. He also thanked Jason Cunningham and Goran Krnaich of the Department of Justice’s Office of International Affairs, Interpol, and the Ministry of Justice, Supreme State Prosecutor’s Office, Special State Prosecutor’s Office, and Police Directorate of Montenegro for their assistance in the extradition of the defendant. Mr. Gitner further thanked the U.S. Securities and Exchange Commission, which previously filed a separate civil action against KWON, and the Commodity Futures Trading Commission.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Jared Lenow, Kimberly Ravener, and Andrew Thomas are in charge of the prosecution.
[1] As the introductory phrase signifies, the entirety of the text of the Superseding Indictment, and the description of the Superseding Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Colebrook, New Hampshire Man Charged with Possession of Child Sexual Abuse MaterialsRead the Press Release
Burlington, Vermont – The Office of the United States Attorney for the District of Vermont announced that on December 19, 2024, a federal grand jury returned an indictment charging Joshua Hartness, age 45, of Colebrook, New Hampshire, with possession of child sexual abuse materials (CSAM). Hartness entered a plea of not guilty to the charges during an arraignment on December 20, 2024 before United States Magistrate Judge Kevin J. Doyle. Judge Doyle ordered that Hartness be released on conditions. According to the indictment, Hartness allegedly possessed one or more images of CSAM between May 22 and August 26 in 2022.
The United States Attorney’s Office emphasizes that an indictment contains allegations only and that Hartness is presumed innocent until and unless proven guilty. Hartness faces up to 20 years in prison if convicted. The actual sentence, however, would be determined by the District Court with guidance from the advisory United States Sentencing Guidelines and the statutory sentencing factors.
The prosecutor is Assistant United States Attorney Colin Owyang. Hartness is represented by Assistant Federal Public Defender Barclay Johnson.
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 Department’s Child Exploitation and Obscenity Section(CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit Justice.gov/PSC.
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