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Thursday 2 January 2025
Boston Man Sentenced for Carrying Loaded Firearm at MBTA Station in BostonRead the Press Release
BOSTON – A Boston man was sentenced today for illegally carrying a loaded pistol. The defendant, a felon who also possessed armor-piercing ammunition, was identified when his online purchasing history showed that he was acquiring firearm accessories and various chemicals that could create incendiary or explosive compounds.
Pepo Herd El a/k/a Pepo Wamchawi Herd, 51, of Dorchester, was sentenced by U.S. District Court Judge Allison D. Burroughs to time served plus 10 days – approximately 49 months in prison, to be followed by three years of supervised release. In December 2024, Herd El pleaded guilty to two counts of being a felon in possession of a firearm and ammunition. Herd El was arrested on Thanksgiving Day 2020 and has been in custody since.
Approximately one year preceding his arrest, Herd El made online firearms-related purchases, including a laser sight, magazines and a concealable holster. Herd El also purchased extended magazine plates, which allow magazines to hold more rounds and a Glock firing pin safety which reduces the force required to pull the trigger. According to court documents, Herd El adhered to the sovereign citizen ideology, which is generally considered anti-government and anti-authority.
On Nov. 26, 2020, Herd El took a bus from his home in Dorchester to the Ruggles MBTA station. At Ruggles, Herd El was detained and searched pursuant to a search warrant. A loaded semi-automatic pistol, a laser sight, three spare magazines, 45 rounds of ammunition, a knife and an infrared camera were recovered during the search. Herd El was also wearing a bullet-proof vest and a jacket that had “security” written on it. He told law enforcement officers that he was on his way to Thanksgiving dinner.
During a subsequent search of Herd El’s residence, another magazine loaded with armor-piercing rounds was recovered well as various drawings of gun barrel designs, firearm suppressors and bullets were on the walls. Various tools that could manufacture ammunition, a chemistry book containing handwritten notes about materials needed to make TNT and C-4 were also found.
Due to several 2004 state convictions for possessing firearms without permits and other crimes, Herd El is prohibited from possessing firearms and ammunition.
United States Attorney Joshua S. Levy and Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. Valuable assistance was provided by the Boston Police Department, the Bureau of Alcohol, Tobacco, Firearms & Explosives, and the U.S. Postal Inspection Service. Assistant U.S. Attorneys Amanda Beck and Timothy Kistner of the National Security Unit prosecuted the case. Assistant U.S. Attorney Benjamin Tolkoff of the Criminal Division also assisted in the prosecution.
Wednesday 1 January 2025
Attorney General Merrick B. Garland Statement on New Orleans AttackRead the Press Release
The Justice Department issued the following statement from Attorney General Merrick B. Garland following the attack in New Orleans:
“The country woke up this morning to news of a terrible tragedy in New Orleans that killed at least 10 people and injured many more.
My heart is broken for those who began their year by learning people they love were killed in this horrific attack, and my prayers are with the dozens who were injured, including the New Orleans Police Department Officers who risked their lives to save others.
The FBI is investigating this matter as an act of terrorism. The FBI, the ATF, the Justice Department’s National Security Division, and the U.S. Attorney’s Office for the Eastern District of Louisiana will continue to work with our law enforcement partners and will deploy every available resource to conduct this investigation.”
Tuesday 31 December 2024
USAO White Collar Crimes Unit Ends 2024 with Notable AchievementsRead the Press Release
CLEVELAND – The White Collar Crimes Unit of the United States Attorney’s Office (USAO) for the Northern District of Ohio prosecutes those who violate federal law through fraud or corruption in any of the 40 northern counties in the state of Ohio that the district serves.
White collar crimes are usually non-violent and typically involve schemes such as tax evasion, embezzlement, money laundering, insider trading, multiple variations of fraud, bribery, and investment scams. They also include public corruption and abuse of government benefits meant for unemployment, health, or small businesses. These crimes increasingly target victims on their computers or other electronic devices and are becoming more technologically sophisticated. Victims of such crimes can be individuals, large or small businesses, organizations, and government entities.
“White collar offenders frequently hatch elaborate plans to obtain money by deceitful means. They plot and scheme their way to taking advantage of circumstances and human nature, causing financial harm to people, businesses, and governments, and undermining public trust,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “Our office has prioritized investigating and prosecuting those who attempt to deceive others—whether individuals, businesses, or government entities and the public at large—by committing crimes to line their own pockets at the expense of victims. We will continue to seek justice and hold wrongdoers responsible for the financial havoc they wreak.”
Notable white collar crime cases for 2024 include:
U.S. v. Basheer Jones – Jones was a former Cleveland city councilman who pled guilty to bribery and wire fraud. He obtained more than $130,000 from local nonprofits through fraud, and then attempted to obtain additional funds through a bribery scheme involving the use of city funds to pay for a nonprofit to purchase a dilapidated property owned by his romantic partner and co-conspirator. He pled guilty to conspiracy to commit wire fraud and honest services wire fraud on Dec. 19, 2024. His sentencing is scheduled for April 1, 2025.
U.S. v. Gregory Gerber – Gerber pled guilty to illegal prescribing of opioids and other substances while ignoring the signs of addiction and abuse in his patients. He was sentenced to 42 months in prison and one year of home confinement. He was also ordered to pay $850,000 in restitution for making fraudulent claims for healthcare reimbursement. A civil complaint was also filed against Gerber, and he agreed to a consent judgment to settle the allegations. The order entered by the court permanently prohibits Gerber from prescribing opioids or other controlled substances, permanently prohibits him from managing, owning, or controlling any entity that dispenses controlled substances, and requires Gerber to pay approximately $4.7 million under the False Claims Act.
U.S. v. Yue Cao – Cao was a bank IT security professional indicted for using his position to find accounts of elderly victims, set up online access to those accounts, and steal funds from them. According to court documents, Cao allegedly transferred approximately $2 million from customers’ real accounts to other accounts he had set up in their names, but that he controlled. Dates for future proceedings are to be determined.
U.S. v. Terrence Pounds – From March 2020 through December 2020, Pounds and his co-defendants devised a scheme to obtain Small Business Administration (SBA)-financed loans from the Economic Injury Disaster Loans (EIDL) program and the Paycheck Protection Program (PPP) under false pretenses. Under the guise of operating faith-based, nonprofit organizations, the SBA approved many of their loan applications. Pounds often received a share of the loan proceeds as payment for obtaining the loan. He was sentenced to 94 months in prison after pleading guilty to conspiracy to commit wire fraud, wire fraud, and money laundering. He was also ordered to pay $4,239,940.43 in restitution to the SBA.
U.S. v. Clarissa Cheney et al. – Six defendants pleaded guilty and were sentenced to a total of 355 months for a COVID-19 fraud conspiracy. From March 2020 to August 2021, they obtained nearly $3,000,000 in federal Pandemic Unemployment Assistance (PUA) benefits using other people’s identities. They submitted fraudulent applications for PUA benefits to California and other states around the country. The defendants, all residents of Northeast Ohio, were sentenced to prison as follows: Clarissa Cheney, 81 months; Kevin Gilmore, 78 months; Tiara Henderson, 70 months; Ladessa Battle, 24 months; Lynard Mitchell, 78 months; and Marcelys Jones, 24 months. Dates for future proceedings for a seventh defendant, Silas Moultrie, are yet to be determined, as Moultrie was a fugitive for approximately one year before being arrested in West Virginia in September 2024.
To report suspected white collar crimes, visit https://tips.fbi.gov/home.
U.S. Attorney’s Office and FBI Investigates Suspected Child Sexual AbuseRead the Press Release
ALBUQUERQUE – The FBI is investigating allegations of child sexual abuse involving a minor against a man in Vanderwagen, New Mexico.
Nolin Leupp, 26, appeared before a federal judge and will remain on conditions of release pending trial, which has not been scheduled, on charges of receiving child sexual abuse material.
According to court documents, on December 8, 2024, a witness reported a suspected sexual assault involving Leupp and a minor victim. The witness further disclosed concerning communications between Leupp and the victim, including Snapchat messages of a sexual nature and plans to meet late at night.
During a subsequent interview on December 19, 2024, Leupp admitted to a romantic relationship with the minor. A search of Leupp’s phone revealed four videos of suspected child sexual abuse material, downloaded from Discord and Snapchat.
If convicted of the current charges, Leupp faces a mandatory minimum of 5 and up to 20 years 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. Assistant United States Attorney Jesse Pecoraro is prosecuting the case as part of 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 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.
View the Criminal Complaint (Leupp).pdfA criminal complaint 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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Three Foley Defendants Sentenced for Drug, Fraud, and Identity Theft CrimesRead the Press Release
MOBILE, AL – Three defendants from Foley were sentenced for their roles in various drug, fraud, and identity theft crimes.
According to court documents, Zachary Heaton Thaggard, 32, Randall Lee Cahoon, 45, and Cheryl Ann Morgan, 73, pleaded guilty to various crimes including conspiracy to possess with intent to distribute fentanyl, bank fraud conspiracy, and aggravated identity theft.
Between February 2022 and November 2023, Thaggard, Cahoon, and Morgan conspired with each other and other people to steal checks and personal identifying information from the mail. Thereafter, the defendants used the stolen materials to commit numerous fraudulent bank transactions. For example, in February 2022, Morgan cashed a counterfeit and forged check stolen from the mail at a check-cashing business in Robertsdale. In January 2023, police recovered counterfeit checks made payable to Thaggard, which Thaggard had left behind in a gas station in Loxley. In October 2023, Cahoon conducted fraudulent check transactions at a credit union in Foley. Agents thereafter arrested Cahoon in possession counterfeit checks, stolen debit and credit cards, blank check stock, counterfeit money, drugs, and drug paraphernalia. Investigators seized and searched Cahoon’s cell phone, which contained text messages and other evidence of the defendants’ fraud scheme.
In November 2023, narcotics agents arrested Thaggard and a coconspirator in Atmore. Agents located and seized half a kilogram of fentanyl in Thaggard’s vehicle. Thaggard confessed to his role in the drug-trafficking and fraud conspiracies to which he pleaded guilty. Agents also seized and searched Thaggard’s cell phone, which contained text messages and other evidence of his crimes.
United States District Judge Kristi K. DuBose sentenced Thaggard to serve 30 months in prison and a five-year term of supervised release, during which time Thaggard will be subject to drug testing and treatment, and will receive mental health evaluation and treatment. The court did not impose a fine, but Judge DuBose ordered Thaggard to pay $300 in special assessments.
Chief United States District Judge Jeffrey U. Beaverstock sentenced Cahoon to serve 75 months in prison and a five-year term of supervised release, during which time Cahoon will be subject to drug testing and treatment, and credit restrictions. Chief Judge Beaverstock sentenced Morgan to time served and a three-year term of supervised release, during which time Morgan will be subject to credit restrictions. The court did not impose fines, but Chief Judge Beaverstock ordered Cahoon to pay $2,468.80 in victim restitution and $200 in special assessments, and Morgan to pay $350 in victim restitution and $100 in special assessments.
U.S. Attorney Sean P. Costello of the Southern District of Alabama made the announcement.
The United States Postal Inspection Service, the Foley Police Department, the Summerdale Police Department, and the Baldwin County Sheriff’s Office investigated the fraud case. The Drug Enforcement Administration, the Baldwin County Sheriff’s Office, the Escambia County Sheriff’s Office, and the Alabama Law Enforcement Agency investigated the drug case.
Assistant U.S. Attorney Justin Roller prosecuted the cases on behalf of the United States.
Shawano Woman Indicted for Drug Offense on Menominee Indian ReservationRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on December 17, 2024, a federal grand jury returned a one-count indictment charging a woman with possession with intent to distribute controlled substances following an incident on the Menominee Indian Reservation. The indictment named Dianna L. Chevalier, a 40-year-old enrolled member of the Menominee Indian Tribe of Wisconsin who was residing in the Shawano area.
The indictment charged Chevalier with Possession with Intent to Distribute Methamphetamine in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C). If convicted of this offense Chevalier faces a maximum of 20 years in prison and up to a $1 million fine. Chevalier also faces a term of supervised release and a special assessment of $100 if convicted.
According to filed court documents, on or about September 10, 2024, while at a location on the Menominee Indian Reservation, Chevalier possessed methamphetamine in a quantity indicating an intent to distribute.
The Menominee Tribal Police Department, Menominee County Sheriff’s Office, and Federal Bureau of Investigation investigated the case. Assistant United States Attorney Andrew J. Maier will prosecute the case in the United States District Court in Green Bay.
Agencies investigated the case under the auspices of the FBI Safe Trails Task Force (STTF) and Wisconsin Department of Justice – Division of Criminal Investigation Native American Drug and Gang Initiative (NADGI). NADGI and STTF partner federal, tribal, state, and local law enforcement to combat drug trafficking and violent crime on the Menominee Indian Reservation. STTF members are deputized federal officers who identify and target for prosecution individuals who are involved in distribution of dangerous drugs on the Menominee Indian Reservation. Coordination of state resources through NADGI permits efficient communication and evidence processing, which are essential to swift but fair prosecution of offenders.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove his guilt beyond a reasonable doubt.
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Shawano Man Indicted for Drug Offense on Menominee Indian ReservationRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on December 17, 2024, a federal grand jury returned a one-count indictment charging a man with possession with intent to distribute controlled substances following an incident on the Menominee Indian Reservation. The indictment named Jerome D. Crowe, a 37-year-old enrolled member of the Menominee Indian Tribe of Wisconsin who was residing in the Shawano area.
The indictment charged Crowe with Possession with Intent to Distribute Cocaine in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C). If convicted of this offense, Crowe faces a maximum of 20 years in prison and up to a $1 million fine. Crowe also faces a term of supervised release and a special assessment of $100 if convicted.
According to filed court documents, on or about November 19, 2024, while at a location on the Menominee Indian Reservation, Crowe possessed cocaine in a quantity indicating an intent to distribute.
The Menominee Tribal Police Department, Menominee County Sheriff’s Office, and Federal Bureau of Investigation investigated the case. Assistant United States Attorney Andrew J. Maier will prosecute the case in the United States District Court in Green Bay.
Agencies investigated the case under the auspices of the FBI Safe Trails Task Force (STTF) and Wisconsin Department of Justice – Division of Criminal Investigation Native American Drug and Gang Initiative (NADGI). NADGI and STTF partner federal, tribal, state, and local law enforcement to combat drug trafficking and violent crime on the Menominee Indian Reservation. STTF members are deputized federal officers who identify and target for prosecution individuals who are involved in distribution of dangerous drugs on the Menominee Indian Reservation. Coordination of state resources through NADGI permits efficient communication and evidence processing, which are essential to swift but fair prosecution of offenders.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove his guilt beyond a reasonable doubt.
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For further information contact:
Public Information Officer
(414) 297-1700
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Ohio Meat Processing Company “Fresh Mark, Inc.” Enters into Non-prosecution Agreement for Scheme to Use Stolen Identities of U.S. Citizens for WorkersRead the Press Release
AKRON, Ohio – Fresh Mark, Inc, has entered into a Non-prosecution Agreement with the U.S. Attorney’s Office for the Northern District of Ohio in connection with its hiring manager’s involvement in an identity theft scheme and subsequent obstruction of justice. The company was founded in 1920 and is a nationwide producer of processed meats under the Sugardale and Superior Brand Meats brands, along with several private labels. Between 2013 and 2018, Homeland Security Investigations (HSI) agents arrested multiple Fresh Mark employees who used stolen identities to gain employment with the company.
According to court documents, a hiring manager at Fresh Mark’s Salem facility, Yelwin Omar Munoz-Solis, 43, of Salem, Ohio, conspired with others to steal identities of U.S. Citizens and give them to job applicants at Fresh Mark’s meat processing plants. He then certified I-9 documents, which are used to verify identity and employment eligibility in the United States. Munoz-Solis was charged and subsequently plead guilty to conspiracy to commit aggravated identity theft, aggravated identity theft, and making false statements on immigration forms submitted to HSI.
HSI served search warrants at Fresh Mark’s processing facilities in Salem, Massillon, and Canton on June 19, 2018, where investigators detained 146 aliens working at the facility who were in the United States without legal status. Approximately 30 of those individuals were later charged with various immigration violations in federal court.
“Stealing identities to transfer to others not eligible to work is not an acceptable business practice,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “Employers must ensure that their hiring practices comply with all federal laws, and businesses caught providing false statements to the government will be held to account.”
“This settlement is a testament to HSI’s commitment to the American people and our Ohio communities,” said HSI Detroit Special Agent in Charge Angie M. Salazar. “I’m extremely proud of the agents and prosecutors, who over many years saw this case through until the end. We should remain vigilant and ensure that all companies abide by the law when it comes labor practices.”
Under the terms of the agreement, Fresh Mark paid a $3,719,997 penalty and will abide by compliance reporting requirements for a period of two years. Pursuant to the Victims of Crime Act Fix to Sustain the Crime Victims Fund Act of 2021, the money will go to the federal Crime Victims Fund.
This case was investigated by Homeland Security Investigations and prosecuted by Assistant United States Attorney David Toepfer.
Menominee Man Indicted for Involuntary Manslaughter and Fleeing Resulting in Death after Vehicle Crash on Menominee Indian ReservationRead the Press Release
Gregory J. Haanstad, United States Attorney for the Eastern District of Wisconsin, announced that on December 17, 2024, a federal grand jury returned a two-count indictment charging a man with involuntary manslaughter and fleeing an officer resulting in death following a vehicle crash on the Menominee Indian Reservation. The indictment named Desmond L. Waukau, Jr., a 21-year-old enrolled member of the Menominee Indian Tribe of Wisconsin who was residing in the Green Bay area.
The indictment charged Waukau as follows:
COUNTDATECHARGEPENALTYOneMay 19, 2024Involuntary Manslaughter in Indian Country, 18 U.S.C. §§ 1112 and 1153(a)Up to 8 years in prison; up to $250,000 fineTwoMay 19, 2024Fleeing an Officer Resulting in Death. 18 U.S.C. § 13(a) and Wis. Stat. §§ 346.04(3) and 346.17(3)(d)30-month mandatory minimum, up to 25 years in prison; up to $250,000 fineWaukau also faces terms of supervised release and special assessments of $100 per count if convicted.
According to filed court documents, on or about September 20, 2024, while at a location on the Menominee Indian Reservation, Waukau attempted to elude a marked police vehicle. Waukau accelerated the vehicle he was operating and, while under the influence of alcohol and a controlled substance, thereof crashed the vehicle. This is alleged to have caused the death of a passenger.
The Menominee Tribal Police Department and Federal Bureau of Investigation investigated the case. Assistant United States Attorney Andrew J. Maier will prosecute the case in the United States District Court in Green Bay.
An indictment is only a charge and not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government must prove his guilt beyond a reasonable doubt.
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Martinsville Doctor Convicted on 467 Federal Counts of Drug DistributionRead the Press Release
ABINGDON, Va. – Joel Smithers, a Martinsville-based doctor, was found guilty of multiple drug charges at the conclusion of a three-week jury trial last week in U.S. District Court in Abingdon, Acting United States Attorney Zachary T Lee announced.
The jury convicted Smithers, 42, after sixteen hours of deliberation, on one count of maintaining a place for the purpose of illegally distributing controlled substances and 466 counts of illegally prescribing Schedule II controlled substances.
“Patients trust doctors to make decisions based on their healthcare needs, not a perversion of their own greed,” Acting United States Attorney Zachary T. Lee said today. “For many years, this defendant betrayed the trust placed in him by his patients, his community, and the medical profession as a whole through his illegal distribution of thousands of medically unnecessary opioids. I am grateful to the entire prosecution team for bringing this case to justice.”
“Physicians have critical roles in addressing the opioid epidemic and ensuring appropriate care for patients with pain and other illness,” mentioned DEA Acting Special Agent in Charge Shane Todd. “Healthcare providers have a vital responsibility when it comes to properly prescribing and dispensing medications and must be vigilant to prevent diversion. Today’s conviction demonstrates Smithers’s criminal indifference to the lives of others, and to the families who loved them. His reckless and fraudulent practices placed profits over the lives of his patients. We’re working hard with our partners to keep our communities and families safe from such tragic outcomes.”
“The existence of these 'pill mills' flooding southwest Virginia with controlled substances violates one of the first principles of the Hippocratic Oath: to do no harm,” said Attorney General Jason Miyares. “Joel Smithers did not seek to treat patients but rather sought to destroy lives for profit. I am grateful to both the U.S. Department of Justice and the U.S. Drug Enforcement Administration for their resilience and professionalism in this and many other instances. My special thanks goes out to Virginia's Medicaid Fraud Control Unit for their exemplary work in keeping our citizens safe.”
Evidence presented at trial showed Smithers opened an office in Martinsville in August 2015 and prescribed controlled substances to every patient in his practice, resulting in over 500,000 Schedule II controlled substances being distributed. The drugs involved included oxymorphone, oxycodone, hydromorphone, and fentanyl. A majority of those receiving prescriptions from Smithers traveled hundreds of miles, one-way, to receive the drugs. Smithers did not accept insurance and took in over $700,000 in cash and credit card payments prior to a search warrant being executed at his office on March 7, 2017.
Smithers was previously convicted in 2019 of these charges. However, after his conviction, the United States Supreme Court changed the law concerning jury instructions in cases involving illegal distribution of controlled substances by health care providers. Accordingly, a new trial was ordered.
Smithers has remained in custody since his original conviction in 2019. Sentencing is scheduled for March 3, 2025, at 10:00 a.m. in Abingdon. For each distribution count, Smithers faces a maximum sentence of imprisonment for a term of 20 years and a fine of $1,000,000. The conviction for maintaining a place for the illegal distribution of controlled substances carries a maximum sentence of imprisonment for a term of 20 years and a fine of $500,000.
The case was investigated by the Roanoke offices of the Drug Enforcement Administration’s Tactical Diversion Squad and the Health and Human Services – Office of Inspector General. Task force officers with the police departments of Bristol, Martinsville, Buena Vista, Roanoke, and Roanoke County; the Sheriff’s Offices of Henry County and Pittsylvania County; the Virginia State Police; and the Medicaid Fraud Control Unit of the Virginia Office of the Attorney General assisted in the investigation.
Assistant United States Attorneys Randy Ramseyer and Corey Hall, and Special Assistant United States Attorney M. Suzanne Kerney-Quillen, a Senior Assistant Attorney General with the Virginia Attorney General’s Major Crimes and Emerging Threats Section, prosecuted the case in this most-recent trial for the United States.
Monday 30 December 2024
United States Reaches Agreement with Clark County to Ensure Polling Place Accessibility for Voters with DisabilitiesRead the Press Release
LAS VEGAS – The United States Attorney’s Office for the District of Nevada has entered into an agreement with the Clark County Election Department to resolve a compliance review that identified numerous physical barriers at polling sites. The agreement resolves the United States’ investigation into Clark County’s compliance with Title II of the Americans with Disabilities Act (ADA), which prohibits discrimination on the basis of disability by a state or local government in any of its programs or services. The agreement will be in place through the 2026 and 2028 election cycles.
“Voting is a fundamental right and the ADA guarantees that every person with a disability has an equal opportunity to exercise that right and cast their ballot in person and independently,” said Sue Fahami, First Assistant United States Attorney, District of Nevada. “We commend Clark County for its willingness to work collaboratively with the United States Attorney’s Office to achieve this goal.”
On June 11, 2024, during Nevada’s primary election, the United States made a compliance review of eight Clark County polling sites by conducting physical surveys. During the surveys, the United States found numerous physical barriers including missing van accessible parking and signage, steep ramps, abrupt level changes at walkways and entrance doors. In advance of the 2024 General Election, Clark County reviewed and made temporary adjustments to remedy the identified concerns.
Under the agreement, Clark County will engage the technical assistance of an accessibility expert and use an evaluation form for each current and prospective polling place based on ADA architectural standards. The Clark County Election Department will also survey polling locations for accessibility throughout the term of the agreement. Additionally, when selecting future polling sites, Clark County will ensure that new locations are ADA accessible. The United States Attorney’s Office will monitor the agreement and provide technical assistance. Clark County will train poll workers on the County’s obligations under the ADA.
The Clark County investigation is part of the Department of Justice’s ADA Voting Initiative, which focuses on protecting the voting rights of individuals with disabilities across the country. A hallmark of the ADA Voting Initiative is its collaboration with jurisdictions to increase accessibility at polling places.
The case is being handled by Assistant United States Attorney Ednin D. Martinez.
For more information on the ADA, please call the department’s toll-free ADA Information Line at 1-800-514-0301 (TTY 1-833-610-1264) or visit www.ada.gov. If you believe you have been discriminated against based on disability, please submit a report www.civilrights.justice.gov.
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voluntary_compliance_agreement_between_the_u.s.a._and_clark_county_nv_dj_no._204-46-181_0.pdfUnited States Files Complaint Against Dave Inc. and CEO Jason Wilk Alleging Deceptive Practices in Violation of Federal LawRead the Press Release
The Justice Department, together with the Federal Trade Commission (FTC), today announced a civil enforcement action against Dave Inc. (Dave) and its co-founder, President, Chief Executive Officer and Chairman of the Board of Directors, Jason Wilk, for alleged violations of the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA).
Dave is a financial technology company that offers consumers short-term cash advances through its mobile app. The government’s lawsuit alleges that the defendants misled consumers by deceptively advertising Dave’s cash advances, charging hidden fees, misrepresenting how Dave uses customers’ tips and charging recurring monthly fees without providing a simple mechanism to cancel them.
According to a complaint filed in the U.S. District Court for the Central District of California, Dave and Wilk market their app as instantly providing consumers “up to $500” without any hidden fees. The complaint alleges that the defendants actually very rarely offer consumers anywhere near the advertised $500, often do not offer any cash advance at all, and charge an “express fee” to get cash advances instantly that they do not clearly disclose before consumers give the app access to their bank accounts. The lawsuit further alleges that the defendants induce app users to pay a sizeable “tip” on Dave’s cash advances by using a deceptive interface that does not offer a clear way to avoid tipping. According to the complaint, Dave’s app falsely represents to consumers that the company will purchase or pay for a certain number of meals for needy children based on the size of a customer’s tip, while in reality Dave keeps the vast majority of tips for itself and donates only a nominal sum to charity that is insufficient to purchase the stated number of meals. Finally, the complaint alleges that the defendants have violated ROSCA by enrolling their customers in automatically recurring monthly membership fees without clearly and conspicuously disclosing material transaction terms and without providing a simple mechanism for consumers to cancel those recurring fees.
This complaint, filed by the Justice Department, seeks unspecified amounts of consumer redress and monetary civil penalties from the defendants and a permanent injunction to prohibit them from engaging in future violations. It amends and replaces an earlier complaint that FTC filed, which named only Dave as a defendant and did not seek any civil penalties.
“The Justice Department is committed to stopping companies and their executives from preying on financially vulnerable consumers with deceptive advertisements, hidden fees and subscriptions that are difficult to cancel,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to enforce the FTC Act, ROSCA and other statutes that protect consumers from such misconduct.”
Senior Trial Attorney Sarah Williams, Trial Attorneys Sean Z. Saper and John F. Schifalacqua and Assistant Director Zachary A. Dietert of the Civil Division’s Consumer Protection Branch are handling the case, in coordination with staff at the FTC’s Bureau of Consumer Protection.
For more information about the Consumer Protection Branch and its enforcement efforts, visit www.justice.gov/civil/consumer-protection-branch. For more information about the FTC, visit www.FTC.gov.
A complaint is merely a set of allegations that, if the case were to proceed to trial, the government would need to prove by a preponderance of the evidence.
United States Attorney Matthew M. Graves to Step Down January 16, 2025Read the Press Release
WASHINGTON – Matthew M. Graves announced today that he is resigning as United States Attorney for the District of Columbia, effective January 16, 2025, after serving in the role for more than three years.
“Serving as the U.S. Attorney for the District of Columbia has been the honor of a lifetime,” said U.S. Attorney Graves. “I am deeply thankful to Congresswoman Holmes Norton for recommending me; to President Biden for nominating me; and to Attorney General Garland for placing his trust in me.”
Bridget M. Fitzpatrick, who has served as Principal Assistant United States Attorney—the highest-ranking career prosecutor in the Office—will become Acting U.S. Attorney when Mr. Graves leaves the Office. Ms. Fitzpatrick has over 15 years of federal law enforcement experience, including serving in the Principal Assistant role for three years. She has been intimately involved in all significant matters the Office has handled during her tenure, working closely with the Office’s law enforcement partners that have been critical to a wide range of successful prosecutions and violence prevention efforts over the past three years.
Mr. Graves was confirmed by the United States Senate on October 28, 2021, and was sworn in as the United States Attorney for the District of Columbia on November 5, 2021. Mr. Graves first joined the Office as a career prosecutor in 2007, serving with distinction in both the Superior Court and Criminal Divisions of the Office, where he prosecuted a wide range of criminal matters, including violent crime, drug trafficking, illegal firearms possession, and fraud cases. In 2010, he was named a senior Assistant United States Attorney within the Office’s Fraud and Public Corruption Section—a Section he ultimately helped lead, first serving as an Acting Deputy Chief and eventually as the Acting Chief of the Section.
Mr. Graves led the Office in overcoming a series of unprecedented challenges, including addressing a nationwide rise in violent crime. As a result of the Office’s efforts and the efforts of others involved in administering the criminal justice system, the District of Columbia will have, in 2024, the least amount of total violent crime it has had in over 50 years.
While working to address the violent crime challenges that were plaguing the District when he joined the Office, Mr. Graves also led the largest investigation the Department of Justice (“DOJ”) has ever conducted to address the violent attack on the U.S. Capitol on January 6, 2021; oversaw the largest successful seizure in DOJ history, when law enforcement authorities recovered $3.6 billion in cryptocurrency from the hack of the Bitfinex global cryptocurrency exchange; and directed a number of other successful efforts, including prosecuting British American Tobacco and its subsidiary, resulting in $629 million in penalties and fines for illicit tobacco sales to North Korea; indicting members of the Islamic Revolutionary Guard Corps (IRGC) with a hack-and-leak operation against the U.S. Presidential campaign of Donald J. Trump; and charging a murder-for-hire plot targeting, among others, former National Security Advisor John Bolton; the trial conviction of the individual who operated the longest-running bitcoin money laundering service on the darknet, which had laundered $400 million in cryptocurrency; and obtaining a roughly $377 million resolution against a government contractor, which is believed to be the largest procurement fraud settlement ever.
Targeting Violent Offenders and Reducing Gun and Drug-Related Violence
Under Mr. Graves’ leadership, the Office and its law enforcement partners have implemented and institutionalized processes for systematically reviewing relevant data to target violent offenders. This data driven approach focuses federal prosecutions on the relatively small group of people in our community who are the primary drivers of gun and drug-related violence. A key component of this approach was implementing in early 2022, a daily review of every gun arrest in the District of Columbia to determine which cases should be targeted for federal prosecution or prosecuted in D.C. Superior Court. This data-driven approach analyzes objective criteria about the offender and the recovered firearm, including the offender’s criminal record and intelligence collected about the person or the recovered firearm, to determine whether the person is a driver of gun violence and a heightened danger to the community.
The Office has also used data to proactively target areas in our city where the majority of gun and drug-related violence occurs and to systematically dismantle criminal networks. As a result of these efforts, we have prosecuted several large-scale, multi-defendant conspiracies, with ties to drug and gun violence to help make the communities in which they operated safer. Specifically, the Office has indicted violent street crews operating in and around MLK/Mellon, SE; Kennedy Street, NW; Greenleaf Gardens; Potomac Gardens; 7th & O, NW; Raum Street, NE; 21st and Maryland, NE; and 37th Place, SE. This data-driven approach has reduced the amount of violence these communities experienced.
The Office has also targeted those responsible for shipping large amounts of fentanyl into the District, holding accountable those responsible for fatal overdoses and supplying the drug markets that serve as a magnet for violence. As an example, the Office held not just the dealer who caused a tragic overdose accountable for the death, but brought charges against the broader network of which the dealer was a part, indicting nearly 30 co-conspirators, including local re-distributors, intermediaries in California, and sources of supply in Mexico.
At the same time, the Office continued to prosecute local violent crime aggressively in D.C. Superior Court. Under Mr. Graves’ leadership, the Office indicted more homicide cases each year during his tenure than it did in any year during the prior decade. The Office has also tried dozens of homicide cases to verdict during this period, obtaining justice for victims in a number of challenging cases. For example, during Mr. Graves’ tenure, the Office conducted two successful multi-month trials against members of a crew, who opened fire in a courtyard in 2018, discharging more than 50 rounds of ammunition and killing a ten-year-old girl; convicted two defendants who were sentenced to more than 100 years in prison for a nine-day shooting spree that culminated in the 2020 death of a thirteen-year-old boy walking to a basketball game; and convicted an individual who was sentenced to 68 years in prison after a jury found that he murdered his girlfriend and her mother in 2021, before shooting his girlfriend’s sister and trying to kill his own infant by setting the apartment on fire.
The Office also continued its long-standing commitment to prosecuting perpetrators of domestic violence, sexual abuse against children and adults, child exploitation and human trafficking. Throughout Mr. Graves’ tenure, the Office worked with its federal law enforcement partners to rescue more than 50 children who were being abused or sexually trafficked online. Additionally, the Office obtained convictions and significant sentences against numerous sexual predators for first degree sexual abuse, including convictions obtained at trial for kidnapping and raping a stranger at knifepoint; sexually abusing children who lived in the same home as the perpetrator; and in cold cases involving serial rapists, including two life sentences imposed for a man who raped strangers in their homes in 2007 and 2010. The Office also prosecuted several individuals who abused positions of trust, including obtaining a 30-year sentence against a government employee stationed in Mexico City who drugged and sexually abused dozens of women over 14 years.
These law enforcement efforts contributed to the 35% year-over-year decrease in total violent crime in 2024, the least amount of overall violent crime in the District in over half a century.
Addressing Challenges with the Criminal Justice Ecosystem
In November 2021, there was a backlog of more than a thousand felony cases that needed to be presented to a grand jury and hundreds of cases that needed to be tried as a result of the global pandemic, which was choking the criminal justice system’s pipeline. Moreover, the D.C. Department of Forensic Sciences (“DFS”) had lost its accreditation in spring 2021, so the Office lacked the DNA, fingerprint, firearms, and drug testing it needed to process and prove many of these cases. In addition to the pending case backlog and the forensic science issues, prosecutors faced a record number of motions filed by convicted defendants seeking early release from prison due to the COVID-19 pandemic or pursuant to changes in D.C. law that allowed many violent offenders to seek early release after serving 15 years.
Mr. Graves realigned resources within the Office and worked with the Court and other external stakeholders to re-stabilize the system and address these issues. As a result of these efforts, the backlog of felony cases pending before the grand jury was resolved by early 2023 for all cases; the backlog of pending trials for all misdemeanors and most felony cases was resolved by mid-2023; and, by late 2023, enough new experts had been identified and retained to handle the volume of forensic work historically performed by DFS. As a result of these efforts, the criminal justice system is in an even stronger position than it was before the pandemic, with a greater percentage of arrests resulting in conviction or some other type of just result, such as successfully completing a diversion program in Drug or Mental Health court.
Protecting National Security
Under Mr. Graves’ leadership, the Office has been at the forefront of our nation’s efforts to guard against illegal acts by malign foreign actors directed at the United States and to hold accountable those who target Americans when they are abroad. These prosecutions include charging: members of the IRGC with a hack-and-leak operation against the U.S. Presidential campaign of Donald J. Trump and, separately, a murder-for-hire plot targeting, among others, former National Security Advisor John Bolton; U.S. and foreign defendants with a wide-ranging scheme, targeting over 300 U.S. companies, orchestrated by North Korea to place overseas IT workers, posing as U.S. citizens, at U.S. companies; multiple individuals spying or acting illegally on behalf of foreign powers; the person who is alleged to have constructed the bomb that downed Pan Am Flight 103, killing 270 passengers, crew members, and residents of Lockerbie, Scotland; and Haitian gang leaders who are alleged to have kidnapped Americans and illegally smuggled U.S. weapons into Haiti.
The Office also brought a series of ground-breaking actions targeting those who sought to violate the sanctions and export control laws that protect our national security interests, including: seizures of hundreds of millions of dollars of illegally trafficked Iranian oil; a criminal resolution with $629 million in penalties against a corporation involved in the illegal sale of tobacco by North Korea; the seizure of a super yacht owned by a sanctioned Russian oligarch; the forfeiture of a Boeing 747 that was owned by an airline affiliated with the IRGC; the first criminal resolution against a company for the illicit sale of Iranian oil; and the indictment of Chinese nationals for illegally exporting U.S.-origin electronic components to Iran and Iranian military affiliates.
Defending Democracy
On January 6, 2021, a violent mob of several thousand individuals stormed the Capitol and the United States briefly lost control of the grounds around the Capitol and much of the Capitol, itself. More than 140 law enforcement officers were injured during the siege of the Capitol, making it the largest single-day mass assault of law enforcement officers in our nation’s history. These events triggered the largest investigation in DOJ history. To date, roughly 1,600 people have been charged in connection with the attack with almost 1,100 having already been sentenced for their conduct. There have been over 170 contested trials with the United States prevailing in more than 99% of them. These convictions include the first seditious conspiracy convictions since the trials stemming from the first bombing of the World Trade Center in the 1990s. Because politically motivated violence and destruction rip at the fabric of our society, Mr. Graves made federally prosecuting such crimes a priority.
Under his leadership, the Office also federally prosecuted self-professed climate activists who targeted priceless artwork and an original copy of the Constitution, and has charged those who assaulted officers and destroyed federal property after attending a protest related to the conflict in Gaza. These prosecutions reflect the fact that people who engage in politically motivated violence and destruction will be prosecuted for their conduct, regardless of their political ideologies or beliefs.
Prosecuting Fraud, Public Corruption, and Civil Rights Violations
Under Mr. Graves’ leadership, the Office prosecuted a number of cybercrimes and crimes involving cryptocurrency, such as the successful prosecution of the individuals responsible for the Bitfinex hack, where the government was able to recover roughly $4 billion in cryptocurrency stolen in the hack—the largest cryptocurrency seizure to date; charging individuals with engaging in a conspiracy to steal and launder over $230 million in cryptocurrency; the trial conviction of the individual who had operated the longest-running bitcoin money laundering service on the darknet, which had laundered $400 million in cryptocurrency; charging an individual with the hack of the Securities and Exchange Commission’s X account that was subsequently used to spike the value of Bitcoin; and recovering millions taken from victims in crypto-confidence schemes.
Other fraud prosecutions that occurred under Mr. Graves’ leadership include frauds on both the government and private parties, including indicting a former defense contractor and his wife for evading taxes on over $350 million in income earned through contracting; prosecuting individuals who collectively attempted to steal tens of millions of dollars in COVID-19 relief funds; convicting individuals who illegally traded on inside information; and convicting an individual who preyed upon thousands of distressed homeowners, bilking them of over $15 million while failing to provide any of the promised relief.
The public corruption prosecutions include numerous successful prosecutions of D.C. government employees and their co-conspirators for bribery; the first successful prosecutions of individuals for contempt of Congress in decades; and the prosecution of a former high-ranking FBI official for false statements he made in connection with payments he had received from individuals with ties to foreign governments.
The civil rights prosecutions include the first two convictions of Metropolitan Police Department officers for murders while on-duty; multiple prosecutions of officers for unlawfully assaulting and depriving their fellow citizens of their civil rights; and a ground-breaking prosecution of individuals who conspired to deprive people of access to lawful reproductive healthcare.
Protecting the Public Fisc
Caseloads in the Office’s Civil Division tripled from 2016 to 2020, as a result of an increase in lawsuits filed against the government during that period. Under Mr. Graves’ leadership, the Office’s Civil Division met this challenge and defended federal agencies in more than 7,000 lawsuits, remaining the Nation’s experts on civil actions brought by requesters for records under the Freedom of Information Act and by medical providers seeking to challenge Medicare reimbursement decisions. Resolving these suits in a just and equitable fashion protects the public fisc by ensuring that the United States expends funds in connection with these suits only when the facts and the law support that payment is warranted. In addition to these defensive cases, the Office also successfully litigated a number of cases it had affirmatively brought against entities and individuals who had fraudulently billed the government, including a roughly $377 million resolution against a government contractor, which is believed to be the largest purely-civil procurement fraud settlement ever, and multiple resolutions involving software providers for defective pricing and fraudulent overcharges, including a trial matter where the court ordered combined damages in excess of $50 million. The Office’s Civil Division also pursue actions against medical providers who fraudulently overcharged government healthcare programs and improper recipients of COVID-19 relief, who falsely certified their eligibility for that relief.
Providing Data Transparency
Mr. Graves has led an unprecedented expansion of the data the Office releases about the important work it is doing to keep the community safe. In late 2022, Mr. Graves hired the Office’s first ever data scientist. Shortly after the data scientist onboarded in early 2023, Mr. Graves oversaw the launch of monthly Superior Court Reports that provide key prosecutorial metrics related to the Office’s prosecution activities in Superior Court. After launching these monthly reports, Mr. Graves negotiated an agreement with the D.C. Criminal Justice Coordinating Council where it shares data the Office provides on a quarterly basis related to prosecution metrics for those crimes that have the greatest impact on community safety, including violent crimes committed with firearms and illegal firearms possession. This effort provides unprecedented detail about the Office’s charging decisions for these offenses and how prosecutions for these offenses were resolved during the reporting period. Mr. Graves also ensured that the Office invested in new technology to make the Office’s data transparency more robust and efficient when the technology goes live later this year.
United States Attorney Jason M. Frierson Announces ResignationRead the Press Release
LAS VEGAS – United States Attorney Jason M. Frierson is resigning on January 17, 2025. He has served in the position since May 2022.
Mr. Frierson was nominated by President Joseph R. Biden on November 15, 2021, and confirmed by the United States Senate on April 27, 2022. He is the first African American to hold the position in the District of Nevada. Mr. Frierson leads a team of over 100 prosecutors and staff professionals with offices located in Las Vegas and Reno.
In addition to his duties as United States Attorney, he served on the Attorney General’s Advisory Committee’s Subcommittees on Voting Rights and Native American Issues.
Statement from United States Attorney Frierson:
“It has been the honor of my lifetime to serve as United States Attorney for the District of Nevada. I thank President Biden for nominating me and am grateful to Senator Catherine Cortez-Masto and Senator Jacky Rosen for their support and confidence in me to lead our team of dedicated public servants to carry out the Justice Department’s mission. Every day, I held each team member to the highest standards to gain the trust of the public we serve, and of our partners in law enforcement. As a team, we have valued integrity, respect and compassion, and excellence in all that we do to make Nevada a safer place. I am also grateful to have been able to work alongside local, state, tribal, and federal partners to build effective relationships that advance the cause of doing the right thing. Together, we prioritized taking guns off the streets, fighting drug trafficking, and reducing violent crime. I have been especially fortunate to be the face of the Office in the community we serve, increasing our presence in the District and fostering strong relationships with local organizations and law enforcement leadership. I look forward to seeing the continued success and courageous work ahead for the Office.”
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U.S. Attorney’s Office Sues and Settles with Katz’s Deli to Ensure Americans with Disabilities Act ComplianceRead the Press Release
Edward Y. Kim, the Acting United States Attorney for the Southern District of New York, announced today the filing and settlement of a lawsuit against the owner and operator of KATZ’S DELICATESSEN OF HOUSTON ST. INC. (“KATZ’S DELI”) for violations of the Americans with Disabilities Act (“ADA”). The settlement, in the form of a consent decree, was entered today by U.S. District Judge Katherine Polk Failla.
Acting U.S. Attorney Edward Y. Kim said: “The corrections and modifications agreed to by Katz’s Deli will give individuals with disabilities an equal opportunity to enjoy one of New York City’s most popular restaurants, as is required by the ADA.”
The lawsuit and consent decree brings to a close the Office’s Manhattan Restaurants ADA Compliance Initiative, first announced in September 2011. As part of the initiative, the U.S. Attorney’s Office reviewed and evaluated the ADA compliance of the 50 “most popular” restaurants in Manhattan as designated by the 2011 Zagat Guide.
Many restaurants required only minor accessibility improvements to comply with the law, and over the next few years, the Office resolved its concerns by letter to approximately two dozen restaurants. In approximately two dozen cases where more extensive accessibility improvements were necessary, the Office entered into voluntary compliance agreements. In two cases, where there were multiple locations of restaurants with significant barriers to accessibility, the Office filed suit: the Office filed a complaint against the owners and operators of three Rosa Mexicano restaurants on October 15, 2012, and the Court approved the Consent Decree with the owners of Rosa Mexicano on January 30, 2013. The Office filed a complaint on October 30, 2013, against the owners and operators of two Carmine’s locations (Upper West Side and Theater District locations), and the Court approved the Consent Decree resolving that matter on November 12, 2013. A handful of restaurants closed before the accessibility review could be completed.
According to the Complaint and Consent Decree filed in Manhattan federal court:
The U.S. Attorney’s Office identified numerous violations of the ADA at KATZ’S DELI, located on the Lower East Side of Manhattan. Most significantly, the main entrance of KATZ’S DELI is not accessible, the restaurant does not provide sufficient dining surfaces for persons with disabilities, and despite having been renovated in 2018, its restrooms fail to comply with the ADA.
Today’s consent decree requires KATZ’S DELI to improve the accessibility of their entrances, dining areas, and restrooms. Notably, the consent decree provides for staff to assist individuals with disabilities in using the main public entrance, ensures that the required number of accessible dining surfaces are provided, and requires renovations to the men’s and women’s restrooms at KATZ’S DELI. In addition, KATZ’S DELI will pay a $20,000 civil penalty to the U.S.
Mr. Kim thanked the Disability Rights Section of the Department of Justice, in particular its architectural staff, for their assistance in this matter.
To file a complaint alleging that any place of public accommodation within the Southern District of New York is not accessible to persons with disabilities, use the Civil Rights Complaint Form available on the U.S. Attorney’s Office’s website, https://www.justice.gov/usao-sdny/civil-rights. Complaints should be emailed or sent by mail to:
U.S. Attorney’s Office, Southern District of New York
86 Chambers Street, 3rd Floor
New York, New York, 10007
Attention: Chief, Civil Rights Unit
The case is being handled by the Office’s Civil Rights Unit in the Civil Division. Assistant U.S. Attorney David Farber is in charge of the case.
U.S. Attorney Gregory K. Harris Announces DepartureRead the Press Release
SPRINGFIELD, Ill. – United States Attorney for the Central District of Illinois Gregory K. Harris announced today that he has submitted his resignation to President Joseph R. Biden, to be effective mid-day on January 2, 2025. Harris, a longtime federal prosecutor who has litigated both criminal and civil matters for the government, plans to retire on the same day.
Harris thanked Senators Tammy Duckworth and Dick Durbin for their support in recommending him as a nominee to President Biden. Harris was nominated in October 2021, confirmed by the United States Senate in December 2021, and sworn in by the federal judiciary that same month. He is the first Black individual to serve as U.S. Attorney in the District.
In February of 2022, United States Attorney General Merrick Garland appointed Harris to the Attorney General’s Advisory Commission, where Harris was one of 13 U.S. Attorneys to represent the nationwide community of 93 U.S. Attorneys.
“Serving as United States Attorney after more than thirty years with the office has been the honor of a lifetime,” said Harris. “Words cannot express my gratitude to the public servants in law enforcement who have dedicated their careers to protecting our community and to the prosecutors and staff in my office who work tirelessly every day in pursuit of justice.”
During Harris’s tenure, the U.S. Attorney’s Office successfully prosecuted defendants in a wide range of cases involving, gun violence, financial fraud, drug trafficking, civil rights violations, and public corruption, among others. Those cases included the prosecutions of Illinois correctional officers for conspiracy to deprive civil rights and civil rights deprivations resulting in the death of Larry Earvin, an inmate at the Western Illinois Correctional Center in Mount Sterling, Illinois. The Office also prosecuted former Illinois State Senator and gubernatorial candidate Sam McCann for fraudulent use of campaign funds, money laundering, and tax evasion. And the Office prosecuted a California man for wire fraud, mail fraud, securities fraud, and money laundering in connection with an investment fraud scheme that netted more than $22,000,000 from victims across the country, including more than fifty residing in the Central District of Illinois.
Harris, who received the Department of Justice’s prestigious Director’s Award in 2018 for his assistance in creating the Central Illinois Human Trafficking Task Force, also focused on that issue during his time as U.S. Attorney. Under his leadership, the Office successfully prosecuted several defendants for kidnapping, forced labor, and conspiracy to commit forced labor in a case where multiple victims – including two children – were compelled to work as domestic servants, hotel maids, and factory laborers and were subjected to physical and sexual abuse. One of those defendants received the first sentence of life imprisonment that had been imposed in over a decade in a forced labor case under the Trafficking Victims Protection Act.
Additional cases that were prosecuted during Harris’s tenure and are pending sentencing include the conviction of a Danville, Illinois, man for carjacking and murder, among other crimes; the weeks-long trial and convictions of two Quad Cities, Illinois, men for a violent string of armed robberies in that area that involved shootings, pistol whippings, and assaults; and the conviction of two Decatur, Illinois, siblings for the kidnapping of a local businessman.
The Office is also presently prosecuting cases against a Springfield man and others allegedly involving area prostitution businesses fronting as massage parlors.
Under Harris’s leadership, the Office recovered millions of taxpayer dollars through civil fraud actions, including a $12.5 million settlement with a Southern Illinois hospital that had overbilled federal healthcare programs. The Office also obtained restitution on behalf of crime victims, achieved access to public accommodations on behalf of disabled individuals, and recovered taxpayer dollars fraudulently obtained from pandemic-era programs.
“Every day individuals in our Office go to work to make the Central District of Illinois safer,” Harris said. “Members of our community deserve to live in a place where they are not subject to gun violence, where they are free from the far-reaching tentacles of financial fraudsters, where purveyors of opiates and other addictive substances are unable to prey on society’s most vulnerable, and where children are protected from the trauma of sexual abuse and exploitation. During my time as the U.S. Attorney, we prosecuted a number of cases in pursuit of these aims. It is my hope that these prosecutions have had direct, positive effects on the community.”
During his investiture, Harris also had stated that his goal was to lead the U.S. Attorney’s Office with compassion, firmness, strength, and community support. “Looking back on my time with the Office, I believe we achieved that goal,” Harris said.
Prior to his nomination as U.S. Attorney, Harris served as an Assistant United States Attorney in the Office for more than thirty years. He held various leadership positions, including Chief of the Criminal Division. He also handled over thirty-five jury trials and several other bench trials involving offenses such as guns, drugs, counterfeiting, armed bank robbery, fraud, child exploitation, political corruption, extortion, and racketeering. Harris won convictions in all but one of his trials.
Harris received his juris doctorate degree from the University of Illinois Chicago School of Law (formerly known as The John Marshall Law School) in 1976 and his Bachelor of Arts degree in Political Science, with a minor in Economics, from Howard University in 1971.
After law school, Harris moved to Springfield, Illinois, in 1976, where he worked for the Illinois Office of the State Appellate Defender as an Assistant Deputy Defender representing indigent defendants on appeal.
In 1979, Harris left the State Appellate Defender’s Office and was chosen as Legal Counsel for the Governor’s Office of Manpower and Human Development in Springfield, which later became the Illinois Department of Commerce and Community Development. In 1980, Harris opened his own law firm. Harris was a solo practitioner until June of 1980.
In June of 1980, Harris was appointed as an Assistant United States Attorney in the U.S. Attorney’s Office in Springfield, where he worked for approximately eight years as a federal prosecutor in the criminal division.
In 1988, Harris left the U.S. Attorney’s Office and entered private practice at the law firm Giffin, Winning, Cohen and Bodewes as an associate. Four years later, Harris became an equity partner in the firm, making him the first Black individual to become a partner at a major Springfield law firm. Harris specialized in employment litigation and criminal defense work.
Harris left the law firm in 2001 to return to the U.S. Attorney’s Office where he served in the Civil Division as its health care fraud attorney representing the government against hospitals, nursing homes, and physicians charged with defrauding the United States. Shortly thereafter, Harris was promoted to the dual positions of Chief of the Criminal Division and Supervisor of the Springfield headquarters office. As the Chief of the Criminal Division, Harris supervised all of the criminal prosecutions within the district.
Harris is married to Hirut Fisseha and has two daughters, Maya and Leah Harris, and a son, Fanuel Harris, who passed away in 2022.
The U.S. Attorney for the Central District of Illinois serves as the chief law enforcement officer for the 46 counties across the mid-section of the state. The district’s headquarters office is in Springfield with district offices in Peoria, Moline, and Urbana, Illinois. The office is responsible for conducting federal criminal prosecutions and protecting the interests of the United States by pursuing and defending against claims in civil litigation.
Phoenix Man Sentenced to 10 Years for Assault of a Federal Officer and Alien Smuggling ChargesRead the Press Release
TUCSON, Ariz. – Michael Leroy Witt, 56, of Phoenix, was sentenced on December 17, 2024, by United States District Judge John C. Hinderaker to 120 months in prison. On July 11, 2024, Witt was convicted at trial of Assault on a Federal Officer Causing Bodily Injury, Conspiracy to Transport Illegal Aliens for Profit, and Transportation of Illegal Aliens for Profit.
On February 20, 2023, a U.S. Border Patrol agent stopped Witt near Sonoita, on suspicion that Witt was transporting undocumented noncitizens. After Witt stopped and tried to wave the agent past him, the agent approached the driver’s side window and told Witt to turn off the vehicle. Witt did not comply with the agent’s instruction and the agent attempted to turn off the engine. Witt then proceeded to hit the gas pedal while the agent was still hanging onto the car window. The acceleration caused the agent to be dragged alongside the vehicle as it veered into the oncoming lane of traffic. The agent was able to turn the vehicle off and bring it to a stop on the opposite side of the road. In the backseat of the vehicle, Witt had concealed two undocumented noncitizens who were being illegally transported further into the United States.
Customs and Border Protection’s United States Border Patrol conducted the investigation in this case. Assistant U.S. Attorneys Jennifer H. Berman and Ryan P. DeJoe, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR-23-00389-JCH_EJM
RELEASE NUMBER: 2024-182_Witt# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on X @USAO_AZ for the latest news.Participants in “Tech Support” Scheme Charged with Conspiracy to Launder Fraudulent ProceedsRead the Press Release
TUCSON, Ariz. – On December 11, 2024, a federal grand jury in Tucson returned an elder fraud indictment against Ahmed Maqbul Syed, 57, and Rupesh Chandra Chintakindi, 27, both citizens of India, for Conspiracy to Commit Money Laundering. Syed was also charged with Conspiracy to Commit Wire Fraud.
The indictment alleges that Syed, Chintakindi, and others conspired to launder fraudulent proceeds derived from schemes targeting elderly victims around the United States, including Arizona. Generally, victims were lured into the schemes when they observed a “pop-up” display on their computer, indicating their computer had been hacked or there was another issue. Victims were directed to contact “tech support” or “government representatives” to resolve the issue. In fact, victims were directed to other conspirators in the scheme who further convinced the victims that their accounts had been hacked and their information had been compromised, which was not true. The conspirators then instructed the victims to withdraw or transfer money by telling them, for example, that they needed to protect their money and accounts.
Victims were directed to purchase gold from various gold dealers and to withdraw cash. They were then told that individuals purporting to be representatives of the government would retrieve the gold and cash from the victims. Victims were also directed to purchase gift cards from various private businesses and transfer the gift card numbers to individuals they were led to believe would help them. At least one victim was also directed to make cash deposits into a bitcoin ATM.
Convictions for Conspiracy to Commit Money Laundering and Conspiracy to Commit Wire Fraud each carry a maximum penalty of 20 years in prison and a $250,000 fine.
Syed has been arrested on the charges, and the Court has ordered him detained pending trial. An indictment is simply a method by which a person is charged with criminal activity and raises no inference of guilt. An individual is presumed innocent until evidence is presented to a jury that establishes guilt beyond a reasonable doubt.
The Federal Bureau of Investigation (Indianapolis and Phoenix Divisions) and the Marana (Arizona) Police Department conducted the investigation. Other local law enforcement agencies from Arizona, Illinois, Wisconsin, Texas, and Indiana also assisted with the investigation. The United States Attorney’s Office, District of Arizona, Tucson, is handling the prosecution.
CASE NUMBER: CR-24-08825-TUC-JCH
RELEASE NUMBER: 2024-181_Syed# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on X @USAO_AZ for the latest news.Justice Department’s Tenth Distribution Provides over $4 Billion in Nearly Full Recovery to over 40,000 Victims in Madoff Ponzi SchemeRead the Press Release
Edward Y. Kim, the Acting United States Attorney for the Southern District of New York; Brent S. Wible, the Principal Deputy Assistant Attorney General of the United States and head of the U.S. Department of Justice’s Criminal Division; and James E. Dennehy, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that the Madoff Victim Fund (“MVF”) began its tenth and final distribution to victims of the Bernard L. Madoff fraud scheme of over $131.4 million. These funds were forfeited by the U.S. government in connection with the Bernard L. Madoff Investment Securities LLC (“BLMIS”) fraud scheme.
In this distribution, payments will be sent to more than 23,000 victims across the globe, bringing their total recoveries to 93.71% of their fraud losses. Most of these victims were small investors who lost less than $500,000 in the fraud. Through its ten distributions, MVF has paid over $4.3 billion to 40,930 victims in 127 countries as compensation for losses they suffered from the collapse of BLMIS.
This distribution represents the culmination of a decade of work identifying thousands of victims around the world and unwinding layers of complex financial transactions to provide compensation to eligible victims.
Acting U.S. Attorney Edward Y. Kim said: “This Office has never stopped pursuing justice for victims of history’s largest Ponzi scheme. With this tenth and final distribution, we have succeeded in compensating 40,930 victims with close to 94% of their losses. As this extraordinary effort demonstrates, this Office and the U.S. Department of Justice Criminal Division’s Money Laundering and Asset Recovery Section are committed to protecting and assisting victims of crime, no matter how long it takes and no matter how complicated the endeavor.”
Principal Deputy Assistant Attorney General Brent S. Wible said: “The Criminal Division, through its Money Laundering and Asset Recovery Section (“MLARS”), is proud to administer the department’s remission program to compensate victims using forfeited assets. The unprecedented scope and complexity of the Madoff remission process shows the power of forfeiture to recover assets and to compensate victims — a primary goal of the department’s Asset Forfeiture Program. This tenth and final distribution, led by MLARS’s dedicated victim compensation team, achieves the department’s goal of compensating victims by returning over $4 billion in forfeited assets to more than 40,000 victims of Madoff’s crimes and achieving nearly full recovery for these victims.”
FBI Assistant Director in Charge James E. Dennehy said: “Today’s distribution represents an unprecedented conclusion of victim compensation from civil forfeiture actions related to the Madoff scheme with more than $4 billion repaid to over 40,000 victims. These victims implicitly trusted Madoff with their investments only to ultimately lose significant monies to his selfish plan. With the steadfast support from the Justice Department, the FBI will continue its tireless seizure of assets from criminals who steal from others and seek to recover those assets for victim losses.”
According to court documents and information presented in related proceedings, for decades, Bernard L. Madoff used his position as chairman of BLMIS, the investment advisory business he founded in 1960, to steal billions from his clients. On March 12, 2009, Madoff pleaded guilty to 11 federal felonies, admitting that he had turned his wealth management business into the world’s largest Ponzi scheme, benefitting himself, his family and select members of his inner circle.
On June 29, 2009, then-U.S. District Judge (now senior U.S. Circuit Judge), Denny Chin sentenced Madoff to serve 150 years in prison for running the largest fraudulent scheme in history. Of the over $4 billion that has been made available to victims, approximately $2.2 billion was collected as part of the historic civil forfeiture recovery from the estate of deceased Madoff investor Jeffry Picower. An additional $1.7 billion was collected as part of a deferred prosecution agreement with JPMorgan Chase Bank N.A. and civilly forfeited in a parallel action. The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff and their co-conspirators.
The MVF’s payouts would not have been possible without the extraordinary efforts of the U.S. Attorney’s Office for the Southern District of New York, the Criminal Division’s Money Laundering and Asset Recovery Section, and the FBI in the prosecution of Madoff’s crimes and the recovery of assets supporting the forfeiture in this case.
The MVF is overseen by Richard Breeden, former Chairman of the U.S. Securities and Exchange Commission, who serves as Special Master appointed by the Department of Justice to assist in connection with the victim remission proceedings. Mr. Breeden and his team at MVF have been essential in working with the Department to evaluate over 66,000 remission petitions involving billions in cash flows, and to compute each victim’s fraud losses to enable payments to be made.
This case is being handled by the Office’s Illicit Finance and Money Laundering Unit. Assistant U.S. Attorney Tara M. La Morte is in charge of the prosecution. The remission of these forfeited funds is being handled by the Office and the U.S. Department of Justice Criminal Division’s Money Laundering and Asset Recovery Section.
More information about MVF and its compensation to victims of BLMIS is available on the MVF website at www.madoffvictimfund.com, such as eligibility criteria, process updates, and frequently asked questions. Further questions may be directed to the MVF at 866-624-3670 or [email protected].
Justice Department’s 10th Distribution Brings Total Provided to over $4.3B in Nearly Full Recovery to over 40,000 Victims in Madoff Ponzi SchemeRead the Press Release
The Justice Department announced today that the Madoff Victim Fund (MVF) began its 10th and final distribution of over $131.4 million to victims of the Bernard L. Madoff fraud scheme. These funds were forfeited by the U.S. government in connection with the Bernard L. Madoff Investment Securities LLC (BLMIS) fraud scheme.
In this distribution, payments will be sent to more than 23,000 victims across the globe. With this 10th distribution, over 40,000 victims in the Madoff scheme will have recovered 93.71% of their fraud losses. Most of these victims were small investors who lost less than $500,000 in the fraud. Through its 10 distributions, MVF has paid over $4.3 billion from forfeited funds to 40,930 victims in 127 countries for losses they suffered from the collapse of BLMIS.
“The Criminal Division, through its Money Laundering and Asset Recovery Section (MLARS), is proud to administer the department’s remission program to compensate victims using forfeited assets,” said Principal Deputy Assistant Attorney General Brent S. Wible, head of the Justice Department’s Criminal Division. “The unprecedented scope and complexity of the Madoff remission process shows the power of forfeiture to recover assets and to compensate victims — a primary goal of the department’s Asset Forfeiture Program. This 10th and final distribution, led by MLARS’ dedicated victim compensation team, achieves the department’s goal of compensating victims by returning over $4 billion in forfeited assets to more than 40,000 victims of Madoff’s crimes and achieving nearly full recovery for these victims.”
“This office has never stopped at pursuing justice for victims of history’s largest Ponzi scheme,” said Acting U.S. Attorney Edward Y. Kim for the Southern District of New York. “With this 10th and final distribution, we have succeeded in compensating 40,930 victims with close to 94% of their losses. As this extraordinary effort demonstrates, this office and MLARS are committed to protecting and assisting victims of crime, no matter how long it takes and no matter how complicated the endeavor.”
“Today’s distribution represents an unprecedented conclusion of victim compensation from civil forfeiture actions related to the Madoff scheme with more than $4 billion repaid to over 40,000 victims,” said Assistant Director in Charge James E. Dennehy of the FBI New York Field Office. “These victims implicitly trusted Madoff with their investments only to ultimately lose significant monies to his selfish plan. With the Justice Department’s steadfast support, the FBI will continue its tireless seizure of assets from criminals who steal from others and seek to recover those assets for victim losses.”
This 10th and final distribution represents the culmination of a decade of work identifying thousands of victims around the world and unwinding layers of complex financial transactions to provide compensation to eligible victims.
According to court documents and information presented in related proceedings, for decades, Bernard L. Madoff used his position as chairman of BLMIS, the investment advisory business he founded in 1960, to steal billions from his clients. On March 12, 2009, Madoff pleaded guilty to 11 federal felonies, admitting that he had turned his wealth management business into the world’s largest Ponzi scheme, benefitting himself, his family, and select members of his inner circle.
On June 29, 2009, Madoff was sentenced to 150 years in prison for running the largest fraudulent scheme in history. Of the over $4 billion that has been made available to victims, approximately $2.2 billion was collected as part of the historic civil forfeiture recovery from the estate of deceased Madoff investor Jeffry Picower. An additional $1.7 billion was collected as part of a deferred prosecution agreement with JPMorgan Chase Bank N.A. and civilly forfeited in a parallel action. The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff, and their co-conspirators.
Compensation from the MVF is possible due to the extraordinary efforts of MLARS, which administers the forfeiture victim compensation program; the U.S. Attorney’s Office for the Southern District of New York; and the FBI, which led the prosecution of Madoff’s crimes and the recovery of assets supporting the forfeiture in this case.
The MVF is overseen by Richard Breeden, former Chairman of the U.S. Securities and Exchange Commission, who serves as Special Master appointed by the Justice Department to assist in connection with the victim remission proceedings. Mr. Breeden and his team at MVF have been essential in working with the department to evaluate over 66,000 remission petitions involving billions in cash flows, and to compute each victim’s fraud losses to enable payments to be made.
More information about MVF and its compensation to victims of BLMIS is available at www.madoffvictimfund.com, such as eligibility criteria, process updates, and frequently asked questions. Further questions may be directed to the MVF at 866-624-3670 or [email protected].
Returning assets to victims of crime is a primary goal of the department’s Asset Forfeiture Program. Since 2000, the victim compensation program has returned more than $12 billion in forfeited assets to victims. MLARS, through its Program Management and Training Unit, coordinates with U.S. Attorneys’ Offices, federal law enforcement and regulatory agencies, and private parties to ensure consistent and efficient return of forfeited assets to victims.
Former jailer admits to sexually assaulting womenRead the Press Release
LAREDO, Texas – A 28-year-old Laredo man has pleaded guilty to sexually assaulting and violating the civil rights of two women, announced U.S. Attorney Alamdar S. Hamdani.
Hector Humberto Rodriguez Jr. was a correctional officer with the Webb County Sheriff’s Department during the commission of the offenses.
On two separate occasions, while working in his law enforcement capacity, he forcibly sexually assaulted two women while they were housed as inmates at the Webb County Jail.
In each instance in January 2022, Rodriguez removed the victims from their cell and isolated them in a secluded area where he then used force, threats of force and coercion to forcibly sexually assault them both. Both victims later came forward and identified Rodriguez as the guard that sexually assaulted them.
“A separate room devoid of witnesses became the setting where trust turned into terror, as Rodriguez, wielding the power bestowed upon him as a jailer, used force and coercion to commit heinous acts. Rodriguez is the worst kind of predator, one who abused his authority, praying upon some of the most vulnerable women in our community,” said Hamdani. “These were women that were in his care, women that he was supposed to look after and protect. Instead, he took advantage of their vulnerability and violated their civil rights for his own sick pleasures.”
U.S. District Judge Diana Saldaña will impose sentencing at a later date. Rodriguez faces up to life in prison as well as potential fines of $250,000 for each of the two counts of conviction.
He has been and will remain in custody pending that hearing.
The FBI and Department of Justice - Office of Inspector General conducted the investigation. Assistant U.S. Attorneys Brandon Scott Bowling and Leslie Ann Cortez are prosecuting the case.
Court Sentences New Orleans Man to Five Years Imprisonment for Trafficking FentanylRead the Press Release
MOBILE, AL – On December 20, 2024, United States District Court Judge Kristi K. DuBose sentenced Terrell Jermaine Perkins of New Orleans, Louisiana, to 60 months imprisonment for possession with the intent to distribute fentanyl.
Documents filed with the court established that on March 30, 2022, a Mobile County Sheriff’s Office deputy conducted a stop of a black 2020 Dodge Journey Van with a Tennessee license plate for a traffic violation on Interstate 10 eastbound near the McDonald Road exit. As the deputy moved closer to the passenger side window and made contact with the driver, he detected a strong odor of marijuana coming from within the van. Perkins, the driver, was then ordered out of the vehicle. Due to the odor of marijuana from the vehicle, law enforcement conducted a probable cause search of the van.
During the search deputies located a black fanny pack on the front passenger's seat. Inside the fanny pack, officers found a plastic bag that contained several small brownish rocks that appeared to be heroin and twelve pills. Perkins admitted to knowing possession of the narcotics. Laboratory tests confirmed the presence of heroin and fentanyl in the brown rocks with a total weight of 40.75 grams. The 12 pills were tested and found to contain 2.2 grams of methamphetamine. Perkins possessed the fentanyl with the intent to distribute it.
The case was investigated by the Department of Homeland Security, Homeland Security Investigations and the Mobile County Sheriff’s Office. The case was prosecuted by Assistant United States Attorney George F. May.Chinese Nationals Sentenced to Serve 20 Years Collectively in Federal Prison for Illegally Trafficking Black-Market Marijuana from Oklahoma Grow OperationRead the Press Release
OKLAHOMA CITY – JEFF WENG, 47, of China and Brooklyn, New York, has been sentenced to serve 120 months in federal prison for his role in a drug trafficking conspiracy, announced U.S. Attorney Robert J. Troester.
On June 6, 2023, a federal grand jury charged Weng and co-defendant Tong Lin, 29, with conspiracy to possess marijuana plants with intent to distribute. On January 18, 2024, after a two-day trial, a federal jury deliberated about an hour before it found Weng and Lin guilty of drug conspiracy.
Between December 2022 and May 2023, evidence at trial indicated that Weng managed a marijuana grow in Wetumka, Oklahoma, and licensed by the Oklahoma Medical Marijuana Authority. Evidence showed that Lin managed matters when Weng was not present. One witness testified that, as part of their participation in the drug conspiracy, they drove delivery vans disguised as commercial vehicles, including one disguised as an “Amazon” delivery van, to the Wetumka Grow 10 to 15 times between December 2022 and March 31, 2023. The witness further testified that they picked up between 150 and 200 pounds of marijuana each time from the Wetumka Grow, and that Lin helped load the fake “Amazon” delivery van with marijuana. The witness testified they transported the marijuana to a stash house in Oklahoma City. Every Friday, the witness transported the marijuana from the stash house to a warehouse in Oklahoma City. There, they loaded more than 2,000 pounds of marijuana at a time into a semi-truck trailer, which transported the marijuana from Oklahoma to the East Coast. Over approximately seven months, the witness shipped upwards of 56,000 pounds of marijuana out of Oklahoma via semi-truck. Evidence also showed that law enforcement searched the Wetumka Grow in May 2023 and located 19,661 marijuana plants in various stages of growth, more than $100,000 of vacuum-sealed cash hidden in Weng’s closet attic space, and a firearm.
At the sentencing hearing on December 19, 2024, U.S. District Judge Scott L. Palk sentenced Weng to serve 120 months in federal prison, followed by five years of supervised release. In announcing his sentence, Judge Palk noted the role Weng played in a “significant” illegal marijuana operation, and the need for deterrence. On June 17, 2024, Lin was sentenced to serve 120 months in federal prison, followed by five years of supervised release.
This case is the result of an investigation by the FBI Oklahoma City Field Office, along with assistance from the Oklahoma Bureau of Narcotics. It is also a part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Assistant U.S. Attorneys Wilson D. McGarry and David Nichols, Jr. prosecuted the case.
Reference is made to public filings for additional information.
Cardiology Clinic and Physician Pay $270,000 to Settle Allegations of Submitting False Claims to Medicare and TRICARERead the Press Release
OKLAHOMA CITY – Cardiovascular Specialists, Inc., (“Cardiovascular Specialists”) and Stewart Katz, MD (“Dr. Katz”), paid $270,000 to settle civil claims stemming from allegations that Cardiovascular Specialists and Dr. Katz submitted false claims to Medicare and TRICARE, announced U.S. Attorney Robert J. Troester.
Cardiovascular Specialists is an Oklahoma corporation which operated a cardiology clinic in Tulsa, Oklahoma, (“Clinic”). Dr. Katz is a cardiologist who owned and practiced at the Clinic. The United States alleges that from January 1, 2016, through February 28, 2020, Cardiovascular Specialists and Dr. Katz engaged in improper “incident-to” billing. Specifically, Cardiovascular Specialists and Dr. Katz submitted or caused the submission of claims to Medicare for the payment of evaluation and management (“E&M”) services under Dr. Katz’ National Provider Identification number that were performed by nurse practitioners when Dr. Katz was not in the Clinic supervising them. The United States also alleges that from January 1, 2015, through June 16, 2022, Cardiovascular Specialists and Dr. Katz submitted or caused the submission of claims to Medicare and TRICARE for E&M services that should have been billed at a lower reimbursement level. To resolve the claims, Cardiovascular Specialists and Dr. Katz agreed to pay $270,000 to the United States.
The settlement resolves allegations filed in a lawsuit by a whistleblower who formerly worked for Cardiovascular Specialists. The lawsuit was filed in federal district court in Oklahoma City under the qui tam, or whistleblower, provisions of the False Claims Act (the “Act”), which permit private individuals to sue on behalf of the United States for false claims and to share in the recovery. The Act also allows the United States to intervene in the lawsuit, which it did in this case. The allegations raised in the lawsuit will be dismissed as part of the settlement.
In reaching this settlement, Cardiovascular Specialists and Dr. Katz did not admit liability, and the United States did not make any concessions about the legitimacy of the claims. The agreement allows the parties to avoid the delay, expense, inconvenience, and uncertainty involved in litigating the case.
Investigative assistance was provided by the Defense Criminal Investigative Service and HHS-OIG Office of Audit Services. Assistant U.S. Attorneys Ronald R. Gallegos and Amanda R. Johnson prosecuted the case.
Activity in the U.S. Attorney's OfficeRead the Press Release
Drug Trafficking
Shane Michael Moser, 29, of Cheyenne, Wyoming, was sentenced to 140 months’ imprisonment with four years’ supervised release to follow, for possession with intent to distribute methamphetamine. According to court documents, on May 17, the Casper Police Department responded to an unconscious male behind the steering wheel of a running vehicle. Upon approaching the car, officers saw a scale with white residue next to Moser. They searched the vehicle and located 223 grams of methamphetamine in the center console. After interviewing the defendant, he admitted to distributing approximately nine pounds of methamphetamine over two months. Moser was indicted on July 18, pleaded guilty on Sept. 30, and U.S. District Court Judge Kelly H. Rankin imposed the sentence on Dec. 20, in Cheyenne. Wyoming. Division of Criminal Investigation Central Enforcement Team and the Casper Police Department investigated the crime. Assistant U.S. Attorney Timothy J. Forwood prosecuted the case. Case No. 24-00117
Firearm Offenses
Justin Keith Noland, 38, of Riverton, Wyoming was sentenced to 28 months’ imprisonment, with three years’ supervised release to follow, for being a felon in possession of firearms. According to court documents, on June 25, the Division of Criminal Investigations (DCI) and the Fremont County Sheriff’s Office (FCSO), executed a State of Wyoming search warrant for Noland’s residence based on probable cause of drug trafficking. The search warrant also authorized law enforcement to search for and seize firearms. In addition, Noland had extraditable arrest warrants out of Natrona and Converse counties.
Law enforcement located a total of three pistols, two of them loaded, and additional ammunition in a backpack. Noland is a previously convicted felon and is prohibited from possessing a firearm. Noland was indicted on July 18, pleaded guilty on Sept. 25 and Chief U.S. District Court Judge Scott W. Skavdahl imposed the sentence on Dec. 18, in Casper. DCI and the FCSO investigated the crime. Assistant U.S. Attorney Timothy W. Gist prosecuted the case. Case No. 24-CR-00123
Illegal Re-Entry of a Previously Deported Alien
Inocente Rios-Lopez aka Villaverde-Sotelo, 48, of Sinaloa Mexico, was sentenced to time served (62 days) and will be deported for illegal reentry into the United States. According to court documents, on Oct. 5, Villaverde-Sotelo was arrested by the Rock Spring Police Department for driving while under the influence. Immigration and Customs Enforcement (ICE) was notified when Sweetwater County Jail emailed Villaverde-Sotelo’s arrest information, including a Mexico Voter identification card named Inocente Rios-Lopez to the agency. On Oct. 7, ICE agents obtained fingerprints that matched an existing immigration record for Villaverde-Sotello who was removed from the U.S. in 2001 and had not applied for permission to reenter. ICE investigated the crime, and Assistant U.S. Attorney Cameron J. Cook prosecuted the case. U.S. District Court Judge Kelly H. Rankin imposed the sentence on Dec. 17, in Cheyenne. Case No. 24-CR-00158About 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
Sunday 29 December 2024
Man Indicted and Arrested for Firearms ViolationsRead the Press Release
SAN JUAN, Puerto Rico – On December 12, 2024, a federal grand jury in the District of Puerto Rico returned an indictment charging Ángel Javier Avilés-Monzón, a.k.a. “Chimi/Yovngchimi” with two counts for firearms violations. FBI special agents arrested Avilés-Monzón today at the Luis Muñoz Marín International Airport.
According to court documents, on or about June 4, 2023, and on or about August 25, 2024, Ángel Javier Avilés-Monzón knowingly possessed a machinegun, that is, a pistol of unknown make and model, modified to fire automatically more than one shot without manually reloading by a single function of the trigger.
If convicted, the defendant faces a maximum penalty of 10 years in prison for each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney W. Stephen Muldrow of the District of Puerto Rico, and Joseph González, Special Agent in Charge of the Federal Bureau of Investigation San Juan Field Office made the announcement.
Assistant U.S. Attorney (AUSA) Alberto López-Rocafort, Chief of the Gang Section, and AUSA Joseph Russell are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Friday 27 December 2024
U.S. Attorney’s Office Recognizes the Contributions of State, Local, and Federal Law Enforcement Partners to the Mission of the U.S. Department of JusticeRead the Press Release
SACRAMENTO, Calif. — U.S. Attorney Phillip A. Talbert is pleased to announce the recipients of the 2023 Eastern District of California Law Enforcement Awards. These awards are presented annually to law enforcement agencies and investigators in the District’s Sacramento and Fresno divisions to recognize outstanding collaboration between federal, state, and local law enforcement in addressing public safety issues in this region.
“Congratulations to all of our award recipients on being chosen and for their efforts to address dangerous crimes that threaten the residents of the Eastern District of California,” said U.S. Attorney Talbert. “We owe a debt of gratitude to these agencies, detectives, and agents who conduct extensive investigations to seek justice for victims and for the public. It is a privilege for our office to work alongside them to keep our communities safe.”
Outstanding Law Enforcement Agency Awards
The Outstanding Law Enforcement Agency Award is presented to a local or state law enforcement agency that has demonstrated outstanding professionalism, commitment to public safety partnerships, and strong support for the U.S. Attorney’s Office’s initiatives.
The Fresno Multi-Agency Gang Enforcement Consortium (MAGEC) is the 2023 recipient of the Eastern District of California Law Enforcement Award for Outstanding Law Enforcement Agency in the Fresno Division. MAGEC received the award for two investigations. The first led to the arrest and charging of more than 25 Norteño gang members in Parlier and surrounding communities for murder, drug trafficking, gun trafficking, and witness and victim intimidation. The second led to the charging of 10 members of the MS-13 gang for six different murders committed in and around the Mendota area. MAGEC is composed of personnel from the Clovis Police Department, the Fresno Police Department, the Kerman Police Department, the Kingsburg Police Department. the Parlier Police Department, the Sanger Police Department, the Selma Police Department. the Fresno County Sheriff’s Office, the California Highway Patrol, and the Fresno County District Attorney’s Office, working in partnership with the California Department of Corrections and Rehabilitation, the Fresno County Probation, the California Department of Justice’s Special Operations Unit, Homeland Security Investigations, DEA, ATF, and FBI. MAGEC demonstrates our shared commitment to keeping our communities safe from violent criminal gangs through teamwork among federal, state, and local law enforcement partners.
The Sacramento Hi-Tech Crimes / Internet Crimes Against Children (ICAC) Task Force is the 2023 recipient of Eastern District of California Law Enforcement Award for Outstanding Law Enforcement Agency in the Sacramento Division. The ICAC Task Force received the award for investigations that led to the successful charging and prosecution of some of the Sacramento region’s most serious sexual offenders in 2023, including multiple defendants who produced child pornography and sexually abused minors. Those defendants included a physician, a nurse practitioner, and an adoptive and foster father who sought to sexually exploit young children. The ICAC Task Force is composed of personnel from the El Dorado County District Attorney’s Office, the Placer County Sheriff’s Office, the Sacramento County Sheriff’s Office, the San Joaquin County Sheriff’s Office, the Citrus Heights Police Department, the Elk Grove Police Department, the Folsom Police Department, the Rocklin Police Department, the Tracy Police Department, the Sacramento Police Department, the California Department of Justice, the California Highway Patrol, and the California Department of Corrections and Rehabilitation, as well as from Homeland Security Investigations and the FBI. The ICAC Task Force exemplifies commitment to protect the most vulnerable in our community by thoroughly investigating internet-facilitated crimes against children.
Outstanding Individual Awards
The Outstanding Investigator and Outstanding Federal Agent awards are presented to local, state, and federal law enforcement officers who have demonstrated outstanding professionalism; timely, thorough, quality investigations; exceptional knowledge and investigative skill; energy and commitment to public safety; and commitment to law enforcement partnerships and teamwork.
The Outstanding Investigator award for the Sacramento Division was given to Yuba County Sheriff’s Office Peace Officer Sixto Torres for his work as a DEA Task Force Officer on Operation Splazh Down, an investigation into a large-scale, poly-drug distribution organization in the Sacramento Area. During Operation Splazh Down, TFO Torres identified the leadership structure of a drug trafficking organization. As a result of his efforts and that of his team, DEA seized more than 500 pounds of methamphetamine and large amounts of cocaine, fentanyl, heroine, and firearms. Torres dedicates exceptional energy to his investigations and consistently exemplifies professionalism and service before self.
The Outstanding Investigator award for the Fresno Division was given to Fresno County Sheriff’s Office Sergeant Scott Schwamb for his work with the Internet Crimes Against Children Task Force. One case where Schwamb was the lead investigator culminated in a 21‑year prison sentence for the defendant. That case began when Schwamb received information that hidden cameras were recording a minor in her bedroom and bathroom. Despite having already worked a full shift, Schwamb reviewed the evidence and assembled an investigative team that evening and applied for a search warrant. By early the next morning, evidence had been collected at the suspect’s home and work and the suspect had been interviewed. Schwamb continued to work on the case by preparing for trial and was the prosecution’s key law enforcement witness at trial. While working on the Task Force, Schwamb has assisted in the investigation of hundreds of leads involving child sexual exploitation, and as a result, dozens of cases have been prosecuted by the U.S. Attorney’s Office and the Fresno County District Attorney’s Office.
The Outstanding Federal Agent award for the Sacramento Division was given to FBI Special Agent Jessi Groff for her work as a member of FBI’s international terrorism squad. She has led the investigations into some of the most important cases in the District, using her unique ability to master details of a case while never losing sight of the big picture. Her work is often unheralded and tedious, yet Special Agent Groff maintains a positive demeanor and attitude. Throughout her years of service, she has become a bedrock of federal law enforcement.
The Outstanding Federal Agent award for the Fresno Division was given to Homeland Security Investigations Special Agent Jackie Lovato for his work on the Fentanyl Overdose Resolution Team (FORT). Agent Lovato has spearheaded the investigation into dozens of fentanyl traffickers in the Central Valley, including some who caused overdose injuries and deaths. One of his cases led to charges against 20 fentanyl and cocaine traffickers, including the self‑proclaimed counterfeit M-30 fentanyl “King of Fresno.” Special Agent Lovato has also offered support to overdose victims and their families and played a key role in educating the public about the dangers of fentanyl in schools, hospitals, law enforcement agencies, and other organizations.
Two New York Men Indicted for Wire Fraud SchemeRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Sun Tong Lin, age 37, and Xueliang Chen, age 36, both of Staten Island, New York, were indicted on December 17, 2024, by a federal grand jury on wire fraud and conspiracy charges.
According to United States Attorney Gerard M. Karam, the indictment alleges that, in June and July of 2024, Sun Tong Lin and Xueliang Chen were part of a scheme to defraud victims by convincing them that their online accounts or bank accounts were not secure. The conspirators would convince the victim to withdraw a large sum of cash and hand it over to an agent for safekeeping, when, in reality, they were stealing the money. Many of the victims were elderly. In total, the indictment alleges that the defendants stole approximately $288,000 from at least nine victims and attempted to steal another $50,000 from one victim in Tioga County.
The case is being investigated by the U.S. Department of Homeland Security and the Federal Bureau of Investigation. Assistant U.S. Attorney Sean A. Camoni is prosecuting the case.
The maximum total penalty under federal law for these offenses is 40 years of imprisonment, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
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Three Ecuadorian Nationals Sentenced in 1,261 Kilogram Cocaine Smuggling CaseRead the Press Release
St. Thomas, VI – United States Attorney Delia L. Smith announced today that Mario Montano Camacho, 41, and Juan Ignacio Reyes Delgado, 48, both of Ecuador, were each sentenced to 78 months of incarceration by Chief Judge Robert A. Molloy after pleading guilty to Possession with Intent to Distribute Cocaine While on Board a Vessel Subject to the Jurisdiction of the United States. A third defendant, Edison Quijije Cuzme, 35, also of Ecuador, was sentenced to 78 months earlier this month following his guilty plea to the same charge. All three defendants are subject to deportation after serving their prison sentences.
According to court documents, on December 22, 2023, while on routine patrol in the Eastern Pacific, the United States Coast Guard Cutter Resolute intercepted a go-fast vessel approximately 110 nautical miles west of Ecuador. The vessel was in international waters traveling at a high rate of speed with no flag being flown and displaying no indicia of nationality. Coast Guard officials further observed that, while pursuing the vessel, the occupants were throwing packages overboard. The go-fact vessel was subdued and treated as one without nationality after the Ecuadorian government could neither confirm nor deny its nationality. Several packages containing approximately 1,261 kilograms of cocaine were later recovered from the ocean.
This case was investigated by the United States Coast Guard and Drug Enforcement Administration and prosecuted by Assistant United States Attorney Yasir Sadat. This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Postal Employee Sentenced to Four Years in Prison for Stealing 47 U.S. Treasury ChecksRead the Press Release
RALEIGH, N.C. – Zerion Marcos Franklin was sentenced to 48 months’ imprisonment and three years of supervised release after stealing over $750,000 in treasury checks. Franklin was also ordered to pay restitution to the United States Treasury.
“Our American postal service is a public trust, staffed with civil servants bound to prioritize the public’s interests above personal gain,” said U.S. Attorney Michael F. Easley, Jr. “Most postal employees honor their oath, faithfully delivering billions of parcels every year. This postal employee is the rare exception, stealing three quarters of a million dollars in U.S. Treasury funds, including tax refunds, from the mail and robbing hardworking American taxpayers in the process. The consequence is clear: steal mail, face prison.”
“We appreciate the outstanding effort by both our law enforcement partners and the Department of Justice,” said Kathleen Woodson, Special Agent in Charge of the U.S. Postal Inspection Service, Office of the Inspector General (USPS-OIG). “The vast majority of Postal Service employees are honest, hardworking individuals who would not violate the public’s trust in this manner. An employee who decides otherwise, will be aggressively investigated by OIG Special Agents. This case serves as an excellent example of the successful collaboration between our federal and state law enforcement partners, and the U.S. Attorney’s Office to pursue and prosecute Postal Service employees.”
According to court documents and other information presented in court, Franklin was a United States Postal Service employee at the mail processing annex in Fayetteville. In June 2024, the Fayetteville Police Department conducted a traffic stop of Franklin’s vehicle. After observing drug paraphernalia in plain view, officers conducted a search of the vehicle. During the search, officers located 47 U.S. Treasury checks made payable to entities and individuals other than the defendant. The checks, which were dated between April and May of 2023, included federal tax refunds, VA benefits, and social security disability benefits. Officers also located marijuana packaged for sale, a loaded 9mm handgun, and over $22,000 in U.S. currency.
Shortly after the traffic stop, an elderly victim in New Hanover County reported the theft of her tax refund check. It was later revealed that the check was stolen from the mail stream, altered to reflect Franklin’s name as the payee, and cashed at a Walmart in Fayetteville on or about May 3, 2023. In total, investigators determined that Franklin stole U.S. Treasury checks totaling over $750,000.
Michael F. Easley, Jr., United States Attorney for the Eastern District of North Carolina, made the announcement after the sentencing by United States District James C. Dever III. The United States Postal Service, Office of Inspector General, investigated the case. Assistant United States Attorney Adam F. Hulbig prosecuted the case for the government.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 5:24-CR-105-D.
Ohio Man Charged with Sexual Abuse of Jail InmateRead the Press Release
CLEVELAND – A federal grand jury sitting in Cleveland, Ohio, has returned an indictment charging an Ohio man for sexual abuse of a person being held in police custody. According to the indictment, Damon K. Perry, 52, of Youngstown, sexually abused a female inmate under federal detention at the Mahoning County Jail on two dates in November 2023. The correctional facility, located in Youngstown, Ohio, serves under contract with a federal law enforcement agency to house detainees at their direction as needed.
The first incident allegedly occurred when the inmate was under Perry’s charge and supervision as she was being held in custody on Nov. 9, 2023. Court documents indicate that the investigation also found a second incident on Nov. 30, 2023, when Perry again engaged in a non-consensual sexual act with the same federal detainee placed under his authority.
“A prison sentence should never include sexual abuse, and certainly not sexual abuse committed by someone to whom we have entrusted a prisoner’s care and custody,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “Correction officers have significant power over the inmates they supervise—they are to use their authority to keep prisoners safe, not abuse it and violate a prisoner’s basic rights.”
This case is being investigated by the U.S. Department of Justice’s Office of the Inspector General and being prosecuted by Assistant U.S. Attorneys Christopher Joyce and Yasmine Makridis for the Northern District of Ohio.
Monroe County Couple Charged with Distributing Fentanyl That Resulted in Three Overdose DeathsRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that James P. Cullen V, age 30, and Michelle L. Ferranti, age 31, both of Bartonsville, Pennsylvania, were indicted by a federal grand jury on various fentanyl and heroin trafficking charges, including for distributing fentanyl that resulted in the deaths of three individuals.
According to United States Attorney Gerard M. Karam, the indictment alleges that the defendants conspired to distribute fentanyl and heroin between April 2021 and February 27, 2023. Cullen and Ferranti specifically were charged with distributing in excess of 400 grams of fentanyl, which is the equivalent of approximately 16,000 potentially lethal individual doses of fentanyl. The indictment also alleges that Cullen and Ferranti obtained fentanyl and heroin from other coconspirators located in New Jersey, marketed the narcotics on the Darkweb, and then used fabricated names to distribute the narcotics. Cullen and Ferranti allegedly mailed fentanyl and heroin to nearly every state in the United States, and to several foreign countries. As a result, it is alleged that three different individuals located in Vermont, Georgia, and Alaska overdosed and died from the fentanyl between October 2022 and February 2023. The individual in Alaska was a juvenile. In addition, Cullen and Ferranti are charged with distributing fentanyl and heroin on four other occasions between November 2022 and February 2023.
The indictment remained under seal until both defendants were arrested. Cullen and Ferranti remain in custody pending their trial.
“These indictments are a testament to the power of the interagency cooperation between HSI, the Postal Inspection Service, and the Pennsylvania State Police,” said Special Agent in Charge of HSI Philadelphia Edward Owens. “The agents and officers have removed two dangerous drug traffickers from our streets, who were responsible for three overdose deaths across the United States. The dismantlement of this drug trafficking organization ensures the safety of the general public. I commend HSI, their law enforcement partners, and the prosecutors with the U.S. Attorney’s Office of the Middle District of Pennsylvania for their tireless work on this case.”
The case was investigated by Homeland Security Investigations, the United States Postal Inspection Service, the Pennsylvania State Police, the Pennsylvania Office of the Attorney General, Customs and Border Patrol, and the New Jersey Office of the Attorney General. Law enforcement agencies from Vermont, Georgia, Alaska, and French Customs also assisted with the investigation. Assistant U.S. Attorney Luisa H. Berti is prosecuting the case.
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.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The penalties under federal law for the most serious, overdose death charges are a minimum of 20 years and maximum life term of imprisonment, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
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Justice Department Issues Final Rule Addressing Threat Posed by Foreign Adversaries’ Access to Americans’ Sensitive Personal DataRead the Press Release
Note: View the fact sheet here.
WASHINGTON – Today, the Justice Department issued a comprehensive final rule carrying out Executive Order (E.O.) 14117 “Preventing Access to Americans’ Bulk Sensitive Personal Data and United States Government-Related Data by Countries of Concern.” The E.O. charged the Justice Department with establishing and implementing a new regulatory program to address the urgent and extraordinary national security threat posed by the continuing efforts of countries of concern (and covered persons that they can leverage) to access and exploit Americans’ bulk sensitive personal data and certain U.S. Government-related data. The Final Rule will take effect 90 days from the date of the Final Rule’s publication, with certain affirmative due diligence, reporting, and auditing requirements taking effect 270 days after publication.
“This final rule is a crucial step forward in addressing the extraordinary national security threat posed of our adversaries exploiting Americans' most sensitive personal data,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “This powerful new national-security program is designed to ensure that Americans' personal data is no longer permitted to be sold to hostile foreign powers, whether through outright purchase or other means of commercial access.”
The Final Rule implements the E.O. by promulgating generally applicable rules for certain categories of data transactions that pose an unacceptable risk to the national security of the United States. As described in the E.O., countries of concern and covered persons can use their access to this data to engage in malicious cyber-enabled activities and malign foreign influence activities, bolster their military capabilities, and track and build profiles on U.S. persons (including members of the military and U.S. Intelligence Community, as well as other Federal employees and contractors) for illicit purposes such as blackmail, coercion, and espionage, and to bolster their military capabilities. Countries of concern and covered persons can also exploit this data to collect information on activists, academics, journalists, dissidents, political opponents, or members of nongovernmental organizations or marginalized communities to intimidate them; curb political opposition; limit freedoms of expression, peaceful assembly, or association; or enable other forms of suppression of civil liberties.
The Final Rule reflects the risk highlighted in the E.O. that the vulnerability of Americans’ bulk sensitive data is exacerbated because countries of concern are increasingly using bulk sensitive personal data to develop and enhance artificial intelligence (AI) capabilities and algorithms that, in turn, enable the use of large datasets in increasingly sophisticated and effective ways to the detriment of U.S. national security. Countries of concern can use AI in conjunction with multiple unrelated data sets, for example, to identify U.S. persons whose links to the federal government would be otherwise obscured in a single dataset and who can then be targeted for espionage or blackmail.
Among other things, the Final Rule identifies countries of concern and covered persons to whom the Final Rule applies, and designates classes of prohibited, restricted, and exempt transactions. The Final Rule establishes bulk thresholds for certain sensitive personal data, including human ‘omic data, biometric identifiers, precise geolocation data, personal health data, personal financial data, and certain covered personal identifiers. The Final Rule also prescribes processes to obtain licenses authorizing otherwise prohibited or restricted transactions; protocols for the designation of covered persons; and provides advisory opinions, and recordkeeping, reporting, and other due diligence obligations for covered transactions.
The Final Rule is consistent with the United States’ commitment to promoting an open, global, interoperable, reliable, and secure internet; protecting human rights online and offline; supporting a vibrant, global economy by promoting cross-border data flows that are required to enable international commerce and trade; and facilitating open investment. Notably, the Final Rule does not impose generalized data localization requirements regarding the physical or electronic storage of Americans’ bulk sensitive personal data or U.S. Government-related data, nor does it require locating computing facilities within the United States to process such data. The Final Rule does not prohibit U.S. persons from conducting medical, scientific, or other research in countries of concern, or from partnering or collaborating with covered persons to share data to conduct researching, if that activity does not involve the exchange of payment or other consideration as part of a covered data transaction. The Final Rule also does not broadly prohibit U.S. persons from engaging in commercial transactions, including exchanging financial and other data as part of the sale of commercial goods and services with countries of concern or covered persons, or impose measures aimed at a broader decoupling of the substantial consumer, economic, scientific, and trade relationships that the United States has with other countries.
The Final Rule further exempts several classes of data transactions from the scope of its prohibitions and restrictions, including personal communications and certain financial services transactions, corporate group transactions, transactions authorized by Federal law and international agreements, investment agreements subject to a Committee on Foreign Investment in the United States (CFIUS) action, telecommunication services, biological product and medical device authorizations, clinical investigations, and others.
The Final Rule’s prohibitions and restrictions are consistent with other access restrictions on sensitive personal data that have been imposed in other contexts, including transactions reviewed by the CFIUS and the Committee for the Assessment of Foreign Participation in the U.S. Telecommunications Services Sector (Team Telecom).
Lastly, under the Final Rule, parties engaging in vendor agreements, employment agreements, and investment agreements involving access by countries of concern or covered persons to bulk U.S. sensitive personal data or U.S. Government-related data would be restricted transactions that must comply with the separate security requirements that have been developed by the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (CISA) in coordination with the Justice Department. These security requirements include organizational and system-level requirements (such as ensuring that basic organizational cybersecurity policies, practices, and controls are in place), and data-level requirements (such as data minimization and masking, encryption, and privacy-enhancing techniques). These critical requirements will be published separately by CISA through the Federal Register and on CISA’s website.
In connection with the Final Rule, the Justice Department will publish compliance, enforcement, and other guidance, which will be located at www.justice.gov/nsd/data-security. The Department will also continue to engage with industry and other stakeholders to determine whether any wind-down licenses are appropriate as this program goes into effect. The Department also anticipates publishing information regarding the application process to seek an advisory opinion or a license for an otherwise prohibited or restricted transaction, as described generally in the Final Rule at Subpart H.
Former Federal Bureau of Prisons Lieutenant Convicted of Violating Inmate’s Civil RightsRead the Press Release
RALEIGH, N.C. – Daniel Mitchell, a former lieutenant at the Federal Bureau of Prisons (FBOP), pleaded guilty to one charge of conspiring to violate civil rights.
“The defendant’s actions were an unacceptable breach of his responsibilities as a law enforcement officer,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “FBOP officers cannot take the law into their own hands, and the Justice Department will aggressively prosecute federal and local law enforcement officials who use physical force to punish inmates.”
“Corrections Officers work in dangerous environments with limited resources and deserve our respect and gratitude,” said U.S. Attorney Michael F. Easley, Jr., for the Eastern District of North Carolina. “But officers acting outside the law to injure an inmate erodes the rule of law, violates civil rights and puts other officers’ lives in jeopardy. We won’t tolerate misconduct in our prisons, by inmates or guards, and will take every measure to keep our institutions safe.”
“Rather than following the normal disciplinary process, Mitchell devised a plan to violently retaliate against an inmate,” said Special Agent in Charge Timothy C. Edmiston of the Justice Department Office of the Inspector General (OIG) Mid-Atlantic Region. “This coordinated attack violated the civil rights of a defenseless inmate and broke every tenet that FBOP employees swear an oath to uphold. The Justice Department OIG is committed to protecting the civil rights of inmates and will pursue any DOJ employee who abuses their power.”
According to court documents and other information presented in court, on Dec. 8, 2021, Mitchell was on duty as a lieutenant supervising the special housing unit (SHU) at Federal Correctional Institute Butner Medium II. Victim K.G. was an inmate housed in the SHU under Mitchell’s supervision.
That morning, a female officer reported to Mitchell that she had been doing rounds in the SHU when inmate K.G. exposed himself and engaged in a sexual act within her view. After the female officer left, Mitchell called another corrections officer, co-conspirator 1, into his office to discuss how to handle K.G.’s alleged misconduct. The normal disciplinary process at FBOP involved a formal write-up of the alleged misconduct. Mitchell and co-conspirator 1 decided that the formal disciplinary was not sufficient. Instead, Mitchell directed co-conspirator 1 to take inmate K.G. from his cell to a holding cell to teach him a lesson by “tuning him up.”
After receiving Mitchell’s instructions, co-conspirator 1 asked some fellow officers to help move inmate K.G. to a holding cell. Once they were alone in the cell, co-conspirator 1 struck and kicked inmate K.G. several times, and knocked him to the ground. Other officers intervened and pulled co-conspirator 1 away from K.G. K.G. sustained minor injuries and later called a medical emergency to his room because the incident aggravated a preexisting back condition and caused spasms.
The Justice Department’s Officer of Inspector General initiated an investigation into the matter after an officer witness raised concerns. In interviews, multiple officer witnesses described officer co-conspirator 1’s unprovoked assault on inmate K.G. Officers also described seeing co-conspirator 1 meet with Mitchell just prior to when co-conspirator 1 asked for their assistance moving inmate K.G. to the holding cell. In later interviews, Mitchell and co-conspirator 1 both described meeting in Mitchell’s office and admitted that they agreed that officer co-conspirator 1 would assault K.G. as punishment.
A sentencing hearing is scheduled for March 31, 2025. Mitchell faces a maximum penalty of 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Justice Department’s Office of the Inspector General investigated the case.
Assistant U.S. Attorney Jake D. Pugh for the Eastern District of North Carolina and Trial Attorney Eric Peffley of the Justice Department’s Civil Rights Division are prosecuting the case.
Former Federal Bureau of Prisons Lieutenant Convicted of Violating Inmate’s Civil RightsRead the Press Release
Daniel Mitchell, a former lieutenant at the Federal Bureau of Prisons (FBOP), pleaded guilty this week to one charge of conspiring to violate civil rights.
“The defendant’s actions were an unacceptable breach of his responsibilities as a law enforcement officer,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “FBOP officers cannot take the law into their own hands, and the Justice Department will aggressively prosecute federal and local law enforcement officials who use physical force to punish inmates.”
“Corrections Officers work in dangerous environments with limited resources and deserve our respect and gratitude,” said U.S. Attorney Michael F. Easley Jr for the Eastern District of North Carolina. “But officers acting outside the law to injure an inmate erodes the rule of law, violates civil rights and puts other officers’ lives in jeopardy. We won’t tolerate misconduct in our prisons, by inmates or guards, and will take every measure to keep our institutions safe.”
“Rather than following the normal disciplinary process, Mitchell devised a plan to violently retaliate against an inmate,” said Special Agent in Charge Timothy C. Edmiston of the Justice Department Office of the Inspector General (OIG) Mid-Atlantic Region. “This coordinated attack violated the civil rights of a defenseless inmate and broke every tenet that FBOP employees swear an oath to uphold. The Justice Department OIG is committed to protecting the civil rights of inmates and will pursue any DOJ employee who abuses their power.”
According to court documents and other information presented in court, on Dec. 8, 2021, Mitchell was on duty as a lieutenant supervising the special housing unit (SHU) at Federal Correctional Institute Butner Medium II. Victim K.G. was an inmate housed in the SHU under Mitchell’s supervision.
That morning, a female officer reported to Mitchell that she had been doing rounds in the SHU when inmate K.G. exposed himself and engaged in a sexual act within her view. After the female officer left, Mitchell called another corrections officer, co-conspirator 1, into his office to discuss how to handle K.G.’s alleged misconduct. The normal disciplinary process at FBOP involved a formal write-up of the alleged misconduct. Mitchell and co-conspirator 1 decided that the formal disciplinary was not sufficient. Instead, Mitchell directed co-conspirator 1 to take inmate K.G. from his cell to a holding cell to teach him a lesson by “tuning him up.”
After receiving Mitchell’s instructions, co-conspirator 1 asked some fellow officers to help move inmate K.G. to a holding cell. Once they were alone in the cell, co-conspirator 1 struck and kicked inmate K.G. several times, and knocked him to the ground. Other officers intervened and pulled co-conspirator 1 away from K.G. K.G. sustained minor injuries and later called a medical emergency to his room because the incident aggravated a preexisting back condition and caused spasms.
The Justice Department’s Officer of Inspector General initiated an investigation into the matter after an officer witness raised concerns. In interviews, multiple officer witnesses described officer co-conspirator 1’s unprovoked assault on inmate K.G. Officers also described seeing co-conspirator 1 meet with Mitchell just prior to when co-conspirator 1 asked for their assistance moving inmate K.G. to the holding cell. In later interviews, Mitchell and co-conspirator 1 both described meeting in Mitchell’s office and admitted that they agreed that officer co-conspirator 1 would assault K.G. as punishment.
A sentencing hearing is scheduled for March 31, 2025. Mitchell faces a maximum penalty of 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Justice Department’s Office of the Inspector General investigated the case.
Assistant U.S. Attorney Jake D. Pugh for the Eastern District of North Carolina and Trial Attorney Eric Peffley of the Justice Department’s Civil Rights Division are prosecuting the case.
Former Assistant United States Attorney Timothy J. Ohms Retires from the Department of Justice After More Than Thirty Years of Federal ServiceRead the Press Release
Spokane, Washington - Today marks the final day of service for one of Eastern Washington’s longest-tenured federal prosecutors. Over the past thirty-three years, Assistant United States Attorney (AUSA) Timothy J. Ohms has served with distinction as a trial attorney and mentor within the United States Attorney’s Office. He is an expert in complex cases involving mental illness, international affairs/extradition, natural and cultural resource crimes, and violent crime. He was also one of the very first Assistant United States Attorneys in Eastern Washington to file cyberstalking charges.
AUSA Ohms prosecuted several significant drug trafficking cases as well as violent crime cases arising in Eastern Washington. He also was at the forefront of prosecuting cases involving wildlife and Native American artifacts. Over the course of his career, AUSA Ohms tried more than forty cases to a verdict and argued eighty-six cases in the Ninth Circuit Court of Appeals. Below are some highlights from AUSA’s tenure in the Eastern District of Washington:
- In 1992, AUSA Ohms and former AUSA Rolf Tangvald successfully prosecuted Barbara Fraley and Phil W. Champagne in connection with federal counterfeiting charges. Through the investigation into Fraley, authorities learned that Champagne had staged his death in the Olympia area in the early 1980s to collect on a $1.5 million insurance policy. After Champagne’s family collected on the insurance payout, he assumed the identity of Harold Richard Stegeman until his true identity was discovered during the investigation, prosecution, and trial of Fraley. The investigation began with the passing of a single counterfeit federal reserve note by Fraley at what was then a Perkins Restaurant in Ritzville. The case was the subject of a 1995 book by Burl Barer.
- In 1995, AUSA Ohms was a member of the prosecutorial team in United States v. Antero Carreno. The case was part of a larger investigation of organized drug trafficking in Northcentral Washington. Carreno ultimately pled guilty and stipulated to responsibility for smuggling 100 kilograms of cocaine into Canada.
- In 2001, AUSA Ohms was the trial attorney in United States v. John Calvert. Based on the evidence presented at trial, Calvert had been hired to retaliate against an elderly resident of Spokane who had testified in another federal case. In June of 1998, Calvert traveled to Spokane from Port Angeles with a co-conspirator. The co-conspirator entered the victim’s home and bound the victim and victim’s wife. The victim was able to break free, access a handgun, and shoot and kill the co-conspirator. The victim was shot and injured in the exchange. Calvert was convicted on all counts charged against him and received a lengthy prison sentence.
- In 2002, AUSA Ohms led an investigation of crack cocaine distribution by members of the Rolling 20s Crips street gang in the Browne’s Addition neighborhood of Spokane. Members of the gang had taken over a large number of units at what was then the Casa Grande apartment complex. The drug distribution fueled a large amount of collateral criminal conduct in the area. The investigation involved the simultaneous service of 23 search warrants at the apartment complex and led to the conviction of 15 people involved in the criminal enterprise.
- In 2010, AUSA Ohms led the prosecution team in United States v. Clarence Stensgar, wherein Stensgar was convicted of raping two women on the Colville Indian Reservation. For this pattern of sexual abuse, Stensgar was sentence to more than 10 years in federal prison.
- In 2011, AUSA Ohms and his trial partner, AUSA Tyler Tornabene, obtained a guilty verdict against Ricky S. Wahchumwah and Victoria Jim, who were convicted at trial for selling bald and golden eagle parts in violation of the Lacey Act. Wahchumwah, Jim, and other co-defendants had been illegally poaching bald and golden eagles by using horse and deer carcasses for bait. The tail feathers, flight feathers, and plumes were removed from the eagles and offered for sale. Evidence in the case revealed that the total number of eagles killed as part of the criminal activity exceeded fifty.
AUSA Ohms prosecuted the “Twisp Trio” in 2012, for violating the Endangered Species Act. The charges related to the unlawful killing of endangered gray wolves near Twisp, Washington. The investigation began when a resident of the area attempted to ship a fresh wolf hide to Canada using a false description of the shipment and a false name. The shipper refused the package because it was draining blood.
- In April 2014, AUSA Ohms prevailed in the Ninth Circuit Court of Appeals in United States v. Gillenwater, a case involving the transmission of threatening communications through the United States mail. AUSA Ohms argued the case before retired Supreme Court Justice Sandra Day O’Connor, who was sitting by designation on the case. Justice O’Connor wrote the opinion affirming the government’s position on appeal.
- In 2015, AUSA Ohms was the trial attorney in United States v. Cardenas, involving the possession of methamphetamine in conjunction with the unlawful possession of a firearm and an explosive device by a felon and in furtherance of a drug trafficking crime. The case stemmed from an incident on the lower South Hill in Spokane on April 26, 2012, in which Cardenas was shot during an exchange of gunfire with an unidentified person. The stolen firearm used by Cardenas was found on a woman who was attempting to drive Cardenas to the hospital. The evidence included bullets that were lodged in a neighboring home. Cardenas was convicted on all counts and sentenced to over 20 years in custody.
- AUSA Ohms led the prosecution team in the 2015 trial of Jason C. Youker, who orchestrated a conspiracy to distribute methamphetamine and heroin from a private compound located on Gold Mountain near Republic, Washington. Evidence at trial established that Youker used the compound to cut and package heroin and methamphetamine and then buried these drugs on the compound. Youker would disclose the locations of heroin and methamphetamine to subordinates or customers by text message. Youker was found guilty of more than thirty criminal counts that included the unlawful possession of firearms and the use of a communication facility in the commission of a drug felony. Youker was later sentenced to twenty years in federal prison.
- In 2018, AUSA Ohms and then law clerk Emily Sauvageau won the case of United States v. Odell Kinard. Just over a month prior, AUSA Ohms had volunteered to take over the drug-trafficking conspiracy case, which arose out of a Title III wiretap investigation. The jury stayed out less than two hours before returning verdicts of guilty on all 12 counts.
- AUSA Ohms and his co-counsel, Russell E. Smoot obtained a conviction against Rio A. Mirabal for the 2021 arson of St. Charles Parrish and School in Spokane, Washington. Mirabal also was ordered to pay nearly $5 million in restitution for the damage caused by the fire.
- In 2023, AUSA Ohms served on the trial team with AUSA Michael J. Ellis in United States vs. Tainewasher. The case involved a toddler on the Yakama Indian Reservation who died from exposure to fentanyl.
- AUSA Ohms, who also served as a Special Deputy Prosecuting Attorney in Stevens County, played a critical role in bringing first-degree murder charges against Charles Lloyd Tatom in connection with the 1997 deaths of Marlene and Cassie Emmerson. For approximately two decades, AUSA Ohms and AUSA Earl Hicks worked together on a parallel conspiracy investigation involving an outlaw motorcycle club community in the Colville area. Charges in the case were filed just over a week ago.
During his time with the Department of Justice, AUSA Ohms served on a detail to Romania as a Resident Legal Advisor. During his time overseas, AUSA Ohms represented DOJ’s Office of Overseas Prosecutorial Development, working with the Romanian Minister of Justice, judges, prosecutors, and other members of the criminal justice on matters of international priority, including human trafficking, counter terrorism, internal corruption, and transnational organized crime. During his four years in Romania, AUSA Ohms worked tirelessly to assist Romanian authorities to improve the efficiency and fairness of the criminal justice system.
Throughout his career, AUSA Ohms served as a mentor to younger AUSAs – helping them navigate the courtroom and teaching them how to present a federal case. Ohms also played a key role in the office’s law student intern program, investing countless hours in the interview process and mentoring the interns accepted into the program. AUSA Ohm’s involvement and dedication to mentoring during his DOJ tenure has been invaluable both for the Eastern District of Washington and nationwide. Many of the more than 100 law clerks AUSA Ohms mentored have become prosecutors, including several who serve as Assistant United States Attorneys and DOJ Trial Attorneys across the United States.
“Tim’s advocacy on behalf of the people of Eastern Washington is second-to-none. Whenever there is a sensitive, high-profile, complex, or challenging case, Tim is the one to handle it,” stated U.S. Attorney Waldref. “Tim did not shy away from hard cases. He has a passion and talent for telling the story of the victim by ensuring their voice is heard and understood in the courtroom. While we will miss Tim, his legacy will live on through the lives that he has touched over his storied 33-year career.”
First Assistant United States Attorney Richard R. Barker, stated, “Tim played a key role in recruiting me to the Eastern District of Washington, and he served as my mentor after I joined the office. I will forever be grateful for his example of what it means to be an AUSA – to always seek justice, to protect our community, and to make the right decisions, even when no one is looking. The U.S. Attorney’s Office for the Eastern District of Washington is a better place because of Tim Ohm’s Service.”
“Tim Ohms is an exceptional lawyer, and it has been my honor and privilege to serve with him for the past thirty-three years,” stated AUSA Earl A. Hicks. “He is one of our most seasoned prosecutors. Whenever he was in trial, I would become entranced by Tim’s incredible opening statements.”
AUSA Ohms graduated from Western Washington University with a degree in English and Classical Greek. He received his J.D. from Seattle University School of Law in 1985 and a Masters of Fine Arts from Eastern Washington University in 2003 while also serving as an AUSA. After graduating from law school, AUSA Ohms worked in private practice in Clarkson before becoming a Deputy Prosecuting Attorney in Asotin County, Washington. In 1988, Ohms was appointed the Asotin County Prosecutor, where he served until joining the U.S. Attorney’s Office in October of 1991.
Federal jury convicts Pharaoh’s owner of multiple charges, including bribery, sex trafficking conspiracy and witness tamperingRead the Press Release
BUFFALO, N.Y. - U.S. Attorney Trini E. Ross announced today that a federal jury has convicted Peter Gerace, 57, of Clarence, NY, of conspiracy to defraud the United States, bribery, sex trafficking conspiracy, maintaining a drug involved premises, narcotics conspiracy, witness tampering, and distribution of cocaine, which carry a maximum of life in prison.
Assistant U.S. Attorneys Joseph M. Tripi, Nicholas T. Cooper, and Casey L. Chalbeck, stated that between 2005, and 2019, Gerace, owner and operator of Pharaoh's Gentlemen's Club, conspired to defraud the United States and paid cash bribes to Drug Enforcement Administration special agent Joseph Bongiovanni. In exchange for payments he received, Bongiovanni protected Gerace and utilized his position to dissuade other members of law enforcement from conducting investigations into Gerace’s activities at Pharaoh’s. Bongiovanni was previously convicted and is awaiting sentencing.
In addition, between 2006, through 2019, Gerace knowingly maintained Pharaoh’s Gentlemen's Club as a drug involved premises, where he and others distributed cocaine, Adderall, marijuana, and heroin. Gerace and others distributed controlled substances and used other methods to coerce Pharaoh’s dancers to engage in sex acts inside Pharaoh’s. Gerace also, acting with others, sent threatening Facebook messages to a witness in order to prevent her from testifying and providing information in an official proceeding.
“Peter Gerace preyed on the most vulnerable victims, using them to grow his business and his profits,” stated U.S. Attorney Ross. “Peter Gerace did not want to be caught and have his crimes exposed. However, this investigative and prosecutorial team worked tirelessly, gathering the evidence, and connecting the dots and Peter Gerace now stands convicted of some of the most heinous crimes.”
“This case showcased the reality of trafficking in Western New York and across the country. It revealed the interplay between drugs, human trafficking, how powerful men, like Peter Gerace, used victims’ drug addictions to coerce them into acts of commercial sex for pure profit,” stated Matthew Miraglia, Special Agent-in-Charge of the FBI’s Buffalo Field Office. “Today’s verdict is a win for victims of human trafficking and hope to those who don’t have a voice. The FBI remains committed to eradicating human trafficking and providing victims with resources. We encourage any victim to come forward. Call 1-800-CALL-FBI or report online at tips.fbi.gov.”
“With his conviction, Peter Gerace must face the reality that he is not above the law, nor can he escape its consequences. Homeland Security Investigations, in collaboration with our law enforcement partners, is committed to safeguarding the vulnerable from those who use bribery, manipulation, and fear for their own personal gain,” said HSI Buffalo Special Agent-in-Charge Erin Keegan. “The welfare of the public is our highest priority, and HSI Buffalo will take every necessary measure to protect the safety and wellbeing of Western New Yorkers.”
“Today, a jury found that Gerace was guilty of engaging in drug and sex trafficking, preying on vulnerable victims. He also paid hundreds of thousands of dollars to corrupt Drug Enforcement Administration special agent Joseph Bongiovanni in an attempt to skirt the law and avoid accountability,” said Ryan T. Geach, Special Agent-in-Charge of the U.S. Department of Justice Office of the Inspector General Northeast Region. “I would like to thank the jury for their time and careful consideration of the facts.”
The verdict is the result of an investigation by Homeland Security Investigations, under the direction of Special Agent-in-Charge Erin Keegan, the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Matthew Miraglia, and the U.S. Department of Justice Office of the Inspector General, under the direction of Special-Agent-In-Charge Ryan T. Geach, Northeast Region.
Sentencing is scheduled for August 15, 2025, at 9:30 a.m., before Judge Lawrence J. Vilardo, who presided over the trial of the case.
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Thursday 26 December 2024
United States Attorney Gerard M. Karam Announces ResignationRead the Press Release
SCRANTON – United States Attorney for the Middle District of Pennsylvania Gerard M. Karam announced today that he has submitted his resignation to President Biden effective January 10, 2025. The Middle District of Pennsylvania consists of 33 counties in northeastern and central Pennsylvania and is home to over 3.1 million people. There are offices in Scranton, Harrisburg, and Williamsport. Mr. Karam was nominated by Senators Robert Casey and Patrick Toomey, appointed by President Joseph R. Biden, confirmed by the United States Senate on June 13, 2022, and sworn into office on June 21, 2022.
“As a son of a police officer, being appointed United States Attorney in my home district has been an honor of a lifetime. I am grateful to President Biden, Attorney General Merrick Garland, Senator Robert Casey, and former Senator Patrick Toomey for the opportunity to serve as the chief federal law enforcement officer for the Middle District of Pennsylvania.”
“I am equally thankful for the career attorneys, professional staff and the dedicated law enforcement officers who work honestly, diligently and with the utmost good faith to keep our citizens safe, apply the rule of law equally and to protect the civil rights of our citizens. It has been a true privilege to serve alongside these impressive and committed individuals. Together we have had many proud accomplishments.”
In addition to being United States Attorney, Karam also served on the Attorney General’s Advisory Committee’s Subcommittees on White Collar Crime, Civil Rights and Controlled Substances.
The office and its law enforcement partners have had many achievements during Karam’s tenure:
Public Safety
As part of the Department of Justice’s Project Safe Neighborhoods, the office working hand in hand with Federal, local, and state partners indicted and convicted numerous defendants on drug trafficking, drug delivery resulting in death, firearms offenses, sex trafficking and exploitation of minors and murder. Some notable cases include:
- Three consecutive life sentences for a man who participated in the murder of three people including a federal witness.
- A sentence of 70 years for a man convicted of torture and illegally exporting weapon parts and related service to Iraq. It was only the second time a United States citizen has been convicted on torture charges in our country’s history.
- The indictment of seven individuals dubbed as the Fentanyl Robbery Gang for conspiracy resulting in the deaths of four victims.
Health Care
United States Attorney Karam prioritized fighting fraud, waste, and abuse in the health care industry. His office held health care systems and providers accountable both civilly and criminally. Notable cases include:
- Holding a multi-hospital health system accountable for submitting claims to Medicare for Annual Wellness Visit services that violated Medicare rules and regulations. The health system paid $11,712,336.00 to resolve civil liability.
- Holding a corporation responsible to pay $2,700,000.00 to resolve allegations that it violated the False Claims Act by failing to provide adequate cybersecurity to protect health care information.
- Doctor sentenced to 22 years imprisonment after convictions for unlawful distribution of controlled substances resulting in death.
- Seven defendants indicted on health care fraud kickback scheme involving over One Million Dollars in kickbacks.
Fraud/Theft
Karam also emphasized fighting fraud and theft. His effort resulted in the prosecution of unique and significant cases that include:
- Nine defendants indicted on a decades-long scheme to steal major artworks and sports memorabilia.
- Indictment and guilty pleas of individuals in a multi-state scheme to steal and sell human body parts.
- Four defendants indicted in a $120 Million disadvantaged business fraud scheme.
- Three defendants indicted in a multi-state money laundering and unemployment fraud scheme involving over $60 Million with $35 Million transferred to bank accounts in China.
- Indictment and guilty plea of individual charged with committing $11.5 Million in Covid-19 Pandemic Fraud.
- Indictment of Pennsylvania Common Pleas Court Judge for fraud, tampering with a witness and obstruction of justice.
Civil Rights
United States Attorney Karam took a comprehensive approach to protecting the civil rights of Pennsylvanians through enforcement efforts, community outreach and a strong partnership with the Department of Justice’s Civil Rights Division. These efforts include:
- Presentation of a United Against Hate program at high schools throughout the district;
- Holding corporations accountable for violations of the Fair Housing Act;
- The indictment of three police officers for police brutality involving 22 different arrests; and
- Holding governmental entities accountable for violations of the Americans with Disabilities Act.
Administrative
During Karam’s time, the Financial Litigation Unit collected nearly $20 million in civil actions brought by the Middle District of Pennsylvania. Over $12 million was collected in criminal matters and over $9 million in forfeitures.
The Administrative division led the hiring and onboarding of 15 new Assistant United States Attorneys. The division’s efforts allowed the district to be one of the most productive medium sized offices in the nation.
Karam also led the creation of the district’s first appellate and E-litigation units.
Upon Mr. Karam’s departure, First Assistant United States Attorney John Gurganus will assume the position of Acting United States Attorney pursuant to the Vacancies Reform Act.
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USAO Civil Division Ends 2024 with Notable AchievementsRead the Press Release
CLEVELAND – The Civil Division of the U.S. Attorney’s Office (USAO) for the Northern District of Ohio is responsible for litigating civil cases that involve the United States and its agencies throughout the 40 northern counties in the state of Ohio.
The Assistant U.S. Attorneys in this division litigate a diverse docket of both affirmative and defensive court cases on behalf of the United States and its various agencies. Examples include cases that involve federal laws concerning the environment, disability and anti-discrimination, voting rights, fair housing, fraud recovery on behalf of Medicare and Medicaid, and more. The division also recovers money owed to the government or victims of crimes, and collects payment of criminal restitution, fines, and penalties. Additional areas of responsibility include protecting the United States’ interests in medical malpractice actions, bankruptcies, foreclosures, and social security matters.
“Our civil division attorneys perform a broad array of work that protects the public fisc and has far-reaching impacts, from affirmatively protecting individual civil rights to defending the environment to recovering taxpayer money diverted by individuals and corporations through fraudulent conduct or deceptive health care practices,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “The division’s achievements this year are significant, and we will continue our efforts, next year and beyond, to hold accountable those who break federal laws and cheat the U.S. taxpayer, and to otherwise represent the United States’ interests in civil litigation.”
Some of the division’s notable achievements in 2024 include the following resolutions:
Investigation of the Cleveland Clinic Foundation - The Cleveland Clinic Foundation (CCF) agreed to pay $7,600,000 to resolve allegations that it violated the False Claims Act when it submitted federal grant applications and progress reports to the National Institutes of Health that did not disclose that a key employee involved in administering the grants had financial research support from other sources.
U.S. ex rel. White, et al. v. Rite Aid Corp., et al. - Rite Aid Corporation and 10 subsidiaries and affiliates agreed to settle the government’s allegations of filling unnecessary prescriptions under the False Claims Act and Controlled Substances Act, asserted in United States ex rel. White et al. v. Rite Aid Corp., et al. Under the settlement, the government will be paid $7.5 million.
U.S. ex rel. Rzeszutko v. Elixir Insurance Co., et al. – Three Rite-Aid subsidiaries, Elixir Insurance Company, RX Options LLC, and RX Solutions LLC, agreed to a settlement that resolved allegations that they violated the False Claims Act when they did not accurately report drug rebates to the Medicare program. As part of the settlement, Elixir Insurance and Rite Aid will pay the United States $101 million.
U.S v. Gerber, et al. – A federal court prohibited Ohio physician Gregory Gerber, M.D., from prescribing opioids and other controlled substances and ordered him to pay $4.7 million in a case alleging violations of the Controlled Substances Act and the False Claims Act. Allegations against Gerber include writing prescriptions for opioids and other controlled substances without a legitimate medical basis, causing a patient’s death due to a fentanyl patch overdose, and receiving kickback payments from a drug manufacturer when prescribing certain drugs that contain fentanyl.
U.S. v. Norfolk Southern Railway Co., et al. – The Norfolk Southern Railway Company agreed to a settlement valued at over $363 million to hold it accountable, address, and pay for the damage caused by the Feb. 3, 2023, train derailment in East Palestine, Ohio. The USAO worked in conjunction with the Environmental Enforcement Section of the Justice Department’s Environment and Natural Resources Division to settle the case. The settlement included provisions requiring Norfolk Southern to fund a community health program that will monitor and treat individual medical needs of residents and first responders stemming from the disaster. It also required Norfolk Southern to fund extensive environmental site cleanup to restore the region’s waterways and habitats; to implement expanded rail safety and emergency response measures and measures to improve and protect waterways and wetlands; and to monitor drinking water to ensure it is safe.
Additionally, the USAO’s Civil Division conducted numerous outreach efforts to connect with the community. In 2024, these included the following events:
Voting with a Disability – In February, U.S. Attorney Rebecca Lutzko took part in an online forum to highlight concerns and address issues that voters with disabilities encounter. Advocacy groups and others from throughout the state listened to the presentation and identified areas of concern. This event was held in partnership with the USAO for the Southern District of Ohio.
Legal Aid Society of Cleveland – In April, lawyers and support staff from the USAO volunteered their time and talents at a legal aid clinic. The event was held at the Cleveland Public Library-Memorial Nottingham Branch. Clinic volunteers provided advice and assistance to people with limited financial resources and addressed a range of civil, legal problems, such as landlord and tenant issues, employment, family law, and consumer law.
Summer Camp ADA Compliance – In May the USAO corresponded with numerous summer camps in the district to remind them of their obligations under the Americans with Disabilities Act (ADA). In particular, summer camps must make reasonable modifications to enable campers with disabilities to participate fully in all camp programs and activities.
Toledo Branch Office – Assistant U.S. Attorney Bill Rojas addressed local bar associations, providing current Department of Justice guidance for evaluating requests by debtors to discharge federal student loans. In May, he addressed the Bankruptcy Court Committee of the Toledo Bar Association. In December, AUSA Rojas participated on a panel for the Cleveland Metropolitan Bar Association’s William J. O’Neill and Pat E. Morgenstern-Clarren Bankruptcy Institute. The Department of Justice issued its student loan discharge guidance, in part, to set transparent discharge criteria and ease the burden on bankruptcy debtors in pursuing adversary proceedings.
To report crimes or file a complaint, please visit https://www.justice.gov/action-center/report-crime-or-submit-complaint#complaint.
Twenty-Nine-Year-Old Felon who Illegally Possessed Multiple Guns Sentenced to Federal PrisonRead the Press Release
A convicted felon who possessed two firearms was sentenced December 20, 2024, to two years in federal prison.
Devonte Oye Robertson, age 29, of Cedar Rapids, Iowa, received the prison term after an August 14, 2024, guilty plea to one count of possession of firearms by a felon. At the plea hearing, Robertson admitted that on January 19, 2024, he possessed Sig Sauer and Smith & Wesson pistols after having been convicted of two felonies.
Robertson was sentenced in Cedar Rapids by United States District Court Chief Judge C.J. Williams. Robertson was sentenced to 24 months’ imprisonment. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
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.
Robertson is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Special Assistant United States Attorney Michael S.A. Hudson and it was investigated by the Cedar Rapids Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Federal Bureau of Investigations.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 24-cr-00054.
Follow us on X @USAO_NDIA.
Three Members of Violent National Gang SentencedRead the Press Release
DETROIT – Three members of the Almighty Vice Lord Nation (“AVLN”) were sentenced in federal court this week after a jury convicted them of RICO conspiracy, murder, drug trafficking, and weapons charges on April 23 of this year, United States Attorney Dawn N. Ison announced today. Ison was joined in the announcement by James Deir, Special Agent in Charge of the Detroit Field Office of the Alcohol, Tobacco, Firearms and Explosives (ATF).
Evidence presented at trial, before United States District Judge Jonathan J.C. Grey, proved the Almighty Vice Lord Nation (AVLN) was a vast criminal enterprise which committed acts of violence, drug trafficking, weapons offenses, and other crimes across the country. The AVLN are divided into different branches, each with their own leadership that answers to a “board” in Chicago. The trial involved members of the Traveling Vice Lords in Detroit, Michigan. The jury convicted:
• Terry Douglas, 44, of Detroit, who held the title of “Chief” and was the Michigan leader of the Traveling Vice Lords. Douglas was sentenced to 60 years in prison.
• Schuyler Belew, 31, of Detroit, who held the title of “Universal Elite” and was the Detroit leader of the Traveling Vice Lords. Belew was sentenced to 60 years in prison.
• Devun Baskerville, 34, of Detroit, who held the title of “Chief Enforcer” for the Traveling Vice Lords. Baskerville was sentenced to 70 years in prison.
The evidence at trial showed that these members of the AVLN worked together to further the AVLN, which involved AVLN members committing racketeering acts such as murder, narcotics trafficking, and witness intimidation. The jury heard testimony concerning a brazen shooting that took place in broad daylight at a Detroit park. In that shooting, Baskerville, acting upon orders from Douglas and Belew, murdered an individual suspected of cooperating with law enforcement and attempted to murder his girlfriend when he shot several times into her vehicle as she tried to flee. Also in the vehicle were her two young children, who miraculously, were not harmed. The girlfriend, who was pregnant at the time, suffered gunshot wounds but survived.
The jury also convicted Lawon Carter of drug trafficking and weapons offenses. Carter’s sentencing is set for April 28, 2025.
“The sentences handed down in this case should send a clear message to violent offenders who terrorize our neighborhoods: we won’t stop until you are brought to justice,” said U.S. Attorney Ison. “It is my sincere hope that these sentences bring some closure to the victim’s family.”
“The sentencing of three more members of the Almighty Vice Lord Nation (AVLN) is proof that ATF and its partners have zero tolerance for gang members who use illegal firearms to intimidate and murder our community members. This case was a complete reckoning of this gang and should serve as a wake-up call for gang members across Michigan. These three defendants represent the worst of the worst in our community. Greed bought them a one-way ticket straight into federal prison. It should be common knowledge throughout Michigan: violent gang activity will not be tolerated and will be disrupted; if you pack an illegal firearm to threaten and intimidate people in our community – pack a bag. You’re going to go to federal prison,” said, Special Agent in Charge James Deir.
This prosecution was part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Also instrumental in the investigation and prosecution of this case was the Detroit Police Department, and the Michigan Department of Corrections (MDOC) investigation staff.
Southern California-Based Clinics, Laboratory, and Owners to Pay $15 Million to Settle Allegations of False Claims Arising from Kickbacks and Self-ReferralsRead the Press Release
SETTLEMENT AGREEMENT
LOS ANGELES – A former Van Nuys physician, a medical center he founded, a laboratory he co-owned, and an executive at these entities have agreed to pay $15 million to settle allegations that they submitted false claims to Medicare and Medi-Cal from the payment of illegal kickbacks and self-referring patients, the Justice Department announced today.
Mohammad Rasekhi, who surrendered his medical license in December 2024; Sheila Busheri; Southern California Medical Center (SCMC); and R & B Medical Group, Inc. d/b/a Universal Diagnostic Laboratories (UDL) agreed to pay the amount.
Rasekhi is the founder and chief medical officer of SCMC and the co-owner of UDL. Busheri is the chief executive officer of SCMC and the co-owner and chief executive officer of UDL. SCMC is a federally qualified health center that operates six clinics in Southern California. UDL is a reference and esoteric laboratory in Southern California.
Medicaid is funded jointly by the states and the federal government. The State of California paid a portion of the Medicaid claims at issue and will receive approximately $7 million from the settlement.
The United States alleged that the defendants knowingly submitted or caused the submission of false claims to Medicare and Medi-Cal by:
- paying kickbacks to marketers to refer Medicare and Medi-Cal beneficiaries to SCMC clinics in violation of the Anti-Kickback Statute (AKS):
- paying kickbacks to third-party clinics in the form of above-market rent payments, complimentary and discounted services to clinic staff, and write-offs of balances owed by patients and clinic staff in exchange for referring Medicare and Medi-Cal beneficiaries to UDL for laboratory tests in violation of the AKS; and
- referring Medicare and Medi-Cal beneficiaries from SCMC clinics to UDL for laboratory tests in violation of the Stark Act’s prohibition against self-referrals.
The AKS prohibits parties who participate in federal health care programs from knowingly and willfully offering or paying remuneration in return for referring an individual to, or arranging for the furnishing of any item or services for which payment is made by, a federal health care program.
Likewise, the Stark Act, which is also known as the Physician Self-Referral Law, prohibits physicians from referring patients to receive “designated health services” payable by Medicare or Medicaid from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies.
“Providers who exploit the Medicare, Medicaid, and TRICARE programs for their personal financial gain will be held accountable under the False Claims Act,” said U.S. Attorney Martin Estrada. “This significant resolution evidences our steadfast commitment to ensuring the integrity of federally funded health care programs.”
“Kickback and self-referral schemes risk impairing the judgment of healthcare providers and diminish the reliability of the care that they render,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This resolution upholds the Department’s abiding view that Medicare and Medicaid beneficiaries deserve care that is free from the taint of referrals that were driven by the providers’ financial interest.”
“There is an expectation that providers who receive Medicare and Medicaid program funds obey the law and operate with integrity,” said Acting Special Agent in Charge Eric Larson of the U.S. Department of Health & Human Services Office of the Inspector General (HHS-OIG). “This settlement is a reminder that HHS-OIG is committed to working with our law enforcement partners on holding those providers accountable who exploit taxpayer-funded healthcare programs for their own personal gain.”
“The announced settlement brings closure to the defendants’ schemes to defraud federal healthcare programs, including the Department of Defense’s TRICARE program,” said Bryan D. Denny, Special Agent in Charge for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (“DCIS”), Western Field Office. “This case underscores DCIS’s commitment to working with its partners to hold accountable those who defraud TRICARE, particularly in instances wherein the alleged illicit activities jeopardize patient care.”
The settlement announced today resolves claims brought under the qui tam, or “whistleblower,” provisions of the False Claims Act in a joint filing by Ferzad Abdi, Julia Butler, Jameese Smith, and Karla Solis, who were former employees or managers of SCMC and UDL. The qui tam provisions permit a private party called a “relator” to file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Abdi v. Rasekhi, No. 18-cv-03966 (C.D. Cal.). The settlement announced today includes a $10 million payment for the portion of the case handled by the United States and a $5 million payment in a separate settlement between the relators and the defendants.
The resolution obtained in this matter was the result of a coordinated effort between the United States Attorney’s Office; the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section; and the California Department of Justice. The U.S. Department of Health and Human Services, Office of Inspector General; the U.S. Department of Defense, Office of Inspector General; and DCIS provided assistance.
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 the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
Assistant United States Attorney Jack D. Ross of the Civil Fraud Section and Justice Department Trial Attorney Samson Asiyanbi of the Fraud Section handled this matter for the United States.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
Southern California-Based Clinics, Laboratory and Their Owners to Pay $10M for False Claims Arising from Kickbacks and Self-ReferralsRead the Press Release
WASHINGTON – Mohammad Rasekhi M.D., Sheila Busheri, Southern California Medical Center (SCMC) and R & B Medical Group Inc., doing business as Universal Diagnostic Laboratories (UDL) (collectively, the defendants), have agreed to pay $10 million to resolve allegations that they submitted false claims to Medicare and California’s Medicaid program, known as Medi-Cal, arising from allegations of paying kickbacks and making self-referrals. The defendants are all based in southern California. Rasekhi is the founder and chief medical officer of SCMC and the co-owner of UDL. Busheri is the chief executive officer of SCMC and the co-owner and chief executive officer of UDL. SCMC is a federally qualified health center that operates six clinics in southern California. UDL is a reference and esoteric laboratory in Southern California.
The United States alleged that the defendants knowingly submitted or caused the submission of false claims to Medicare and Medi-Cal by (a) paying kickbacks to marketers to refer Medicare and Medi-Cal beneficiaries to SCMC clinics in violation of the Anti-Kickback Statute (AKS), (b) paying kickbacks to third-party clinics in the form of above-market rent payments, complimentary and discounted services to clinic staff and write-offs of balances owed by patients and clinic staff in exchange for referring Medicare and Medi-Cal beneficiaries to UDL for laboratory tests in violation of the AKS and (c) referring Medicare and Medi-Cal beneficiaries from SCMC clinics to UDL for laboratory tests in violation of the Stark Act prohibition against self-referrals.
The AKS prohibits parties who participate in federal health care programs from knowingly and willfully offering or paying remuneration in return for referring an individual to, or arranging for, the furnishing of any item or services for which payment is made by, a federal health care program. Likewise, the Stark Act, which is also known as the Physician Self-Referral Law, prohibits physicians from referring patients to receive “designated health services” payable by Medicare or Medicaid from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies. “Designated health services” include “clinical laboratory services.” Compliance with the AKS and Stark Act are conditions of payment under federal healthcare programs.
“Kickback and self-referral schemes risk impairing the judgment of healthcare providers and diminish the reliability of the care that they render,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This resolution upholds the department’s commitment to ensuring that Medicare and Medicaid beneficiaries receive care that is untainted by the providers’ financial interest.”
“Providers who exploit the Medicare, Medicaid and TRICARE programs for their personal financial gain will be held accountable under the False Claims Act,” said U.S. Attorney Martin Estrada for the Central District of California. “This significant resolution evidences our steadfast commitment to ensuring the integrity of federally funded health care programs.”
“There is an expectation that providers who receive Medicare and Medicaid program funds obey the law and operate with integrity,” said Acting Special Agent in Charge Eric Larson of the Department of Health & Human Services Office of the Inspector General (HHS-OIG). “This settlement is a reminder that HHS-OIG is committed to working with our law enforcement partners on holding those providers accountable who exploit taxpayer-funded healthcare programs for their own personal gain.”
“The announced settlement brings closure to the defendants’ schemes to defraud federal healthcare programs, including the Department of Defense’s TRICARE program,” said Special Agent in Charge Bryan D. Denny of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS) Western Field Office. “This case underscores DCIS’ commitment to working with its partners to hold accountable those who defraud TRICARE, particularly in instances wherein the alleged illicit activities jeopardize patient care.”
Medicaid is funded jointly by the states and the federal government. The State of California paid a portion of the Medicaid claims at issue and will receive approximately $4 million from the settlement.
The settlement announced today resolves, in part, claims brought under the qui tam or whistleblower provisions of the False Claims Act by Ferzad Abdi, Julia Butler, Jameese Smit and Karla Solis, who were former employees or managers of SCMC and UDL. The qui tam provisions permit a private party called a “relator” to file an action on behalf of the United States and receive a portion of any recovery. The relators’ qui tam case is captioned United States ex rel. Abdi v. Rasekhi, No. 18-cv-03966 (CDCA). Concurrent with this announcement, the relators reached a separate settlement with the defendants for $5 million to resolve additional allegations in their qui tam complaint. The United States and the State of California declined to intervene as to those allegations and was not a party to the separate agreement. The relators’ share of the two settlements has not yet been determined.
The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, U.S. Attorney’s Office for the Central District of California and California Department of Justice, with assistance from HHS-OIG.
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).
Trial Attorney Samson Asiyanbi of the Civil Division’s Fraud Section and Assistant U.S. Attorney Jack Ross for the Central District of California handled the matter.
The claims resolved by the settlement are allegations only. There has been no determination of liability.
Settlement
SCDC Inmate Among 5 Indicted for Conspiracy to Distribute Meth, FentanylRead the Press Release
FLORENCE, S.C. — A federal grand jury in Florence returned a four-count indictment against Jawan Rayel White, 37; Derrell Sherald, 38; Amon Rasheem Rutledge, 34; Alexis Nicole Loscar, 30; and Christian Vargas, 21, for conspiracy to distribute and distribution of methamphetamine and fentanyl.
The indictment alleges that White, while incarcerated in the South Carolina Department of Corrections on a 25-year sentence for drug distribution, conspired with his co-defendants to distribute large quantities of methamphetamine and fentanyl into South Carolina and surrounding states.
White faces a maximum penalty of life imprisonment and is currently incarcerated in SCDC on an unrelated state conviction. Rutledge faces a maximum sentence of life imprisonment and is currently detained pending an initial appearance and detention hearing before the Honorable Kaymani D. West, United States Magistrate Judge. Sherald, Loscar, and Vargas each face penalties of 20 years in prison and are currently detained pending an initial appearance and detention hearing before the United States District Court.
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 Drug Enforcement Administration, United States Postal Inspection Service, and the South Carolina Department of Corrections Office of Inspector General. Assistant United States Attorney Matthew Ellis is prosecuting the case.
U.S. Attorney Adair F. Boroughs stated that all charges in the indictment are merely accusations and that defendants are presumed innocent unless and until proven guilty.
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Postal Employee Accused of Stealing Checks from the MailRead the Press Release
ST. LOUIS – A former U.S. Postal Service supervisor appeared in court Thursday to answer an indictment accusing her of stealing checks from the mail.
Benita D. Randle, 42, was indicted December 11 in U.S. District Court in St. Louis on one count of theft of mail by a U.S. Postal Service employee. She pleaded not guilty Thursday.
The indictment says that on Oct. 31, 2023, Randle stole about 90 checks from mail that had been entrusted to the Postal Service for delivery. Randle was a supervisor at the St. Louis Processing and Distribution Center in St. Louis at the time, the indictment says.
Charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
The U.S. Postal Inspection Service and the U.S. Postal Service Office of Inspector General investigated the case. Assistant U.S. Attorney Jonathan Clow is prosecuting the case.
Ohio Man Sentenced to Prison for Unemployment Insurance and Bank FraudRead the Press Release
CLEVELAND – Darmani Hawkins, 21, of Aurora, was sentenced to 60 months in prison by U.S. District Judge Donald Nugent after pleading guilty to conspiracy to commit wire fraud and mail fraud; conspiracy to commit bank fraud; and mail theft, as part of schemes to fraudulently obtain coronavirus disease (COVID)-era state unemployment benefits and, separately, to steal checks from the mail, alter them, and deposit them. He was also ordered to pay $681,114.14 in restitution and serve three years of supervised release after imprisonment.
According to court documents, from 2020 through 2021, Hawkins conspired to fraudulently obtain COVID pandemic unemployment insurance benefits by submitting fake claims, and in 2023, he conspired to steal checks out of the United States mail, deposit them, and keep the proceeds.
In the COVID fraud scheme, Hawkins and his co-conspirators exploited the CARES Act (Coronavirus Aid, Relief, and Economic Security), which had been established to assist people who were out of work because of the COVID-related shutdown. They submitted false unemployment applications to multiple states, making it appear as if they were eligible to receive benefits when, in fact, they were not. Once a state’s unemployment agency approved the applications, the state mailed the unemployment benefits to Hawkins and his co-conspirators in the form of debit cards, which they used to withdraw cash for their personal benefit.
In the bank fraud and mail theft scheme, Hawkins used a social media platform to recruit postal workers to steal checks from the U.S. Postal Service in exchange for a fee. Hawkins also offered to pay people to use their established bank accounts to deposit the checks stolen from the mail. Those who agreed to participate in mail theft deposited the stolen checks into bank accounts that Hawkins had paid others to allow him to access. Hawkins then withdrew or received the stolen deposited funds.
“Mr. Hawkins shamelessly exploited federal resources intended to help those who became unemployed as a result of an uncontrollable, life-changing world event. His deceitful actions were selfish and heartless, diverting much-needed funds away from those who lost their jobs through no fault of their own,” said U.S. Attorney Rebecca Lutzko for the Northern District of Ohio. “He also manipulated others to steal checks and misuse our banking system in a greedy effort to make easy money. Those, like Mr. Hawkins, who seek to capitalize on the misfortune of others by abusing federal safety nets established to protect the needy, and who steal from the U.S. taxpayer and private citizens, will be held to account and brought to justice.”
“The sentencing of Mr. Hawkins should send a strong message to anyone who believes they can deceive government programs designed to help the American public in times of need. As part of our mission, postal inspectors will aggressively work to protect the public and prevent criminal misuse of the mail,” said Postal Inspector in Charge Lesley Allison of the U.S. Postal Inspection Service’s Pittsburgh Division. “We value our relationships with the U.S. Attorney’s Office and the law enforcement partners involved in bringing Mr. Hawkins to justice.”
During the investigation, officials determined that Hawkins had caused a loss of approximately $425,000 in the COVID fraud scheme and more than $700,000 in the stolen check scheme.
This case was investigated by the U.S. Department of Labor, the U.S. Postal Inspection Service, the Social Security Administration Office of the Inspector General, and the FBI Cleveland Division. The case was prosecuted by Assistant United States Attorney Erica Barnhill for the Northern District of Ohio.
To report fraud, visit https://www.dol.gov/agencies/eta/unemployment-insurance-payment-accuracy/UIFraudReporting or https://www.uspis.gov/report.
Missouri Man Indicted for Federal Hate Crime for Racially Motivated Threats Targeting St. Louis NAACPRead the Press Release
A federal indictment was unsealed charging a Missouri man with threatening the St. Louis office of the NAACP.
Darryl Jaspering, 62, of Warrenton, was indicted for one count of transmitting threatening communications and one count of interference with federally protected activities. According to the indictment, Jaspering wrote a message on the NAACP’s contact page “in which he used racially charged threats to physically harm the recipients of his message.” Jaspering, the indictment says, “intimidated and interfered with and attempted to intimidate and interfere with” NAACP employees “because of their race and color” and threatened the use of a dangerous weapon.
Jaspering faces a maximum penalty of five years in prison, a fine of up to $250,000 or both prison and a fine for the charge of transmitting threatening communications. He also faces a maximum penalty of 10 years in prison, a fine of up to $250,000 or both prison and a fine for the charge of interference with federally protected activities. If convicted, a federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Sayler A. Fleming for the Eastern District of Missouri and Special Agent in Charge Ashley T. Johnson of the FBI St. Louis Field Office made the announcement.
The FBI St. Louis Field Office investigated the case.
Assistant U.S. Attorney Christine Krug for the Eastern District of Missouri and Trial Attorney Taylor Payne of the Civil Rights Division’s Criminal Section are prosecuting the case.
For more information and resources on the department’s efforts to combat hate crimes, visit www.justice.gov/hatecrimes.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former general manager of Anchorage business charged with wire fraud, tax evasionRead the Press Release
ANCHORAGE, Alaska – A federal grand jury in Alaska returned an indictment last week charging an Alabama man with wire fraud and tax evasion after he allegedly defrauded a local Anchorage business while serving as their general manager.
According to court documents, in 2008, James Wohlers, 56, of Deatsville, Alabama, was hired by GBR Equipment/Oilfield Services (GBR), an Anchorage based business that provides oilfield services on the North Slope and elsewhere, as their human resource manager. In 2009, Wohlers became their general manager, overseeing vendor interface, employee hiring, payroll and accounting. Part of his responsibilities included coordinating wire transfers from GBR’s bank account to outside accounts.
In 2019, an audit was completed on the company’s finances and bank records after employees determined the company was earning sufficient revenue but was unable to pay vendors and employees. The audit revealed that from at least 2013 to 2019, Wohlers allegedly executed wire transfers from the GBR account that did not benefit the company, and allegedly used GBR’s corporate credit cards for personal expenses, like paying personal credit card bills.
The indictment alleges that in 2015, Wohlers formed a partnership named BGI Industrial Services (BGI), which was registered with the Alabama Secretary of State. In 2017, GBR performed services for two companies. Wohlers allegedly sent both companies invoices from BGI for $25,000 and $2,500 respectively, and both companies paid the invoices. The money was deposited into BGI’s bank account. Wohlers also allegedly used GBR credit cards to pay for business expenses related to BGI and used employees paid by GBR to complete work on behalf of BGI.
In late 2015, Wohlers announced GBR employee pay cuts of 5 to 10 percent, along with other restrictive measures to address GBR’s poor financial condition. A few months later, Wohlers announced additional GBR employee pay cuts of 5 to 15 percent. Within two weeks of making his second announcement, Wohlers allegedly used over $43,000 of GBR’s funds to pay for airfare and other expenses related to a personal trip to China.
Wohlers was terminated by GBR in August 2019, and the company sent the defendant a demand letter stating he owed GBR $1.5 million. After being terminated, Wohlers allegedly deleted roughly 10,000 emails from GBR’s servers.
Wohlers is charged with one count of wire fraud and three counts of tax evasion. The defendant is scheduled for his initial court appearance on Jan. 10 before U.S. Magistrate Judge Matthew M. Scoble of the U.S. District Court for the District of Alaska. If convicted, he faces up to 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney S. Lane Tucker for the District of Alaska, Special Agent in Charge Rebecca Day of the FBI Anchorage Field Office and Special Agent in Charge Adam Jobes of the IRS Criminal Investigation, Seattle Field Office made the announcement.
The FBI Anchorage Field Office and the IRS Criminal Investigation Seattle Field Office are investigating the case.
Assistant U.S. Attorney Tom Bradley is prosecuting the case.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Former Utah Movie Producer Sentenced for Tax Evasion and Forcibly Retaking Property Seized Under Court OrderRead the Press Release
A Utah man was sentenced on Monday to an aggregate of six years in prison for tax evasion and forcibly retaking a house and land that had been seized under court order to pay his outstanding tax debt.
According to court documents and evidence presented at trial, Paul Kenneth Cromar, formerly of Cedar Hills, Utah, owned a home in Cedar Hills and operated Blue Moon Productions LLC, a freelance film and media production company. From 1999 through 2005, Cromar did not file any federal income tax returns or pay any tax. In 2005, the IRS conducted an audit and assessed him with $703,266.96 in taxes, interest and penalties. For more than a decade thereafter, Cromar did not make any payments towards his outstanding debt and took steps to obstruct the IRS’s ability to collect his delinquent taxes.
In 2019, due to this course of conduct, a federal judge ordered that Cromar’s home be sold at auction to satisfy his tax obligations, which by then had ballooned to over $1 million. Cromar then attempted to stop the sale by filing false documents on the property’s title and with the IRS, including a false promissory note. He also attempted to intimidate potential purchasers of the home and harassed IRS personnel by filing frivolous lawsuits against them personally.
Shortly before the sale closed, Cromar broke into the home and attempted to reclaim it. With the help of others, he occupied the home unlawfully for five months, fortifying it with firearms, sandbags and wooden boards tactically placed throughout the house.
In addition to his prison sentence, U.S. District Judge Howard C. Nielson Jr. for the District of Utah ordered Cromar to serve three years of supervised release and to pay approximately $723,028.65 in restitution to the United States as a condition of his supervised release.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, U.S. Attorney Trina A. Higgins for the District of Utah and Special Agent in Charge Carissa Messick of IRS Criminal Investigation’s Phoenix Field Office made the announcement.
IRS Criminal Investigation’s Phoenix Field Office and the Treasury Inspector General for Tax Administration (TIGTA) jointly investigated the case. The FBI assisted in locating and apprehending Cromar, who had been a fugitive from justice in a related Utah state court criminal matter since August 2022.
Trial Attorneys Meredith Havekost and Patrick Burns of the Tax Division and Assistant U.S. Attorney Mark Woolf for the District of Utah prosecuted the case. Trial Attorney Peter Anthony of the Tax Division assisted with the investigation.
Court Authorizes Service of John Doe Summons for IRS to Seek Identities of U.S. Taxpayers Who Participated in the “Gig Economy” via a Digital PlatformRead the Press Release
A federal court in California entered an order on Monday authorizing the IRS to serve a John Doe summons on JustAnswer LLC, seeking information about U.S. taxpayers who were paid for answering questions as “experts” during the years 2017-2020. The IRS is seeking the records of individuals who were paid by JustAnswer, which operates a digital platform through which members of the public can pay to have questions answered by professionals such as doctors, lawyers, veterinarians, engineers and tax professionals. JustAnswer is headquartered in Covina, California.
The “gig economy” is where people earn income providing on-demand work, services or goods through a digital platform like a website or an app. Well-known examples of such platforms include Airbnb, Uber, Lyft, DoorDash, Etsy, Handy and TaskRabbit. The gig economy is a recent phenomenon associated with the increased prevalence of smart phones and their applications, facilitating the development of online marketplaces and platforms in which individuals can connect to obtain and offer goods and services. Digital platforms commonly serve as intermediaries, connecting sellers or service providers with customers while also processing payments. In the court’s order, U.S. District Judge Dolly M. Gee for the Central District of California found that there is a reasonable basis for believing that U.S. taxpayers who were paid by JustAnswer to answer questions as experts may have failed to comply with federal tax laws.
The court’s order grants the IRS permission to serve what is known as a John Doe summons on JustAnswer. There is no indication that JustAnswer has engaged in any wrongdoing in connection with its digital platform business. Rather, the IRS uses John Doe summonses to obtain information about individuals whose identities are unknown and who possibly violated internal revenue laws, such as by not reporting income they received. This John Doe summons directs JustAnswer to produce records identifying U.S. taxpayers who have used its platform to earn income, along with other documents relating to their work.
“The gig economy has grown in recent years and with it, the concern for tax compliance issues has increased,” said Deputy Assistant Attorney General David Hubbert of the Justice Department’s Tax Division. “This John Doe summons demonstrates that working with the IRS we will use all the tools available to us to ensure that no matter how U.S. taxpayers earn income, they are properly reporting it and paying their taxes. Those who choose to be on the forefront of the gig economy must be aware of, and abide by, all their tax obligations.”
“Like their fellow Americans who earn income through traditional means, U.S. taxpayers who earn income from digital and other platforms that comprise the gig economy need to pay their fair share of taxes,” said IRS Commissioner Danny Werfel. “The world is getting smaller for tax cheats, and we will work collaboratively with our partners to vigorously enforce the nation’s tax laws.”
The IRS Small Business Self-Employed Division and IRS Office of Fraud Enforcement assisted with the investigation that led to this case.
The Justice Department and the IRS are committed to ensuring that taxpayers abide by all federal tax laws. Federal law requires U.S. individual taxpayers to pay taxes on all income earned worldwide. Individuals must report all income earned from the gig economy on a tax return. This includes income from part-time, temporary or “side work”; income not reported on an information return form (like a Form W-2 or 1099) or other income statement; or income paid in cash, property, goods or digital assets.
The Tax Division reminds gig economy workers that the IRS has information and tips for how they can comply with their tax obligations. The IRS also has guidance for digital platform providers about their tax reporting and filing requirements.
John Doe Ex Parte Petition Order - JA.pdf