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11 October 2024
Court Sentences Two Fentanyl Traffickers from India to 46 Months ImprisonmentRead the Press Release
MOBILE, AL – On October 11, 2024, 2024, United States District Court Judge Kristi K. DuBose sentenced Sundar Chebiam and Roshan Landge each to 46 months imprisonment for Conspiracy to Possess with the Intent to Distribute Fentanyl. Both men are from India and are illegally in the United States.
Documents filed with the court established that on February 1, 2023, US Customs and Border Protection Officers at JFK Airport in New York intercepted a suspicious package coming from India via England. The package was addressed to a gas station on Schillinger Road in Mobile. Further investigation revealed the package contained 10,000 Tapentadol pills, which are a DEA Schedule II pharmaceutical drug.
Homeland Security Investigators, along with Mobile County Sheriff’s Office (MCSO) deputies, made a controlled delivery of the package to the gas station. At that time Chebiam stated the package was for him and he accepted the package. Chebiam was then arrested and he confessed that an individual in India mails packages of prescription pills to the gas station and once he receives the packages he is paid to re-package and mail smaller amounts of pills to various addresses in the United States.
Chebiam also advised agents he had more pills at his residence, which he shared with the co-defendant, Roshan Landge. MCSO deputies then went to the residence. When they arrived they realized Landge had been tipped off about Chebiam’s arrest at the gas station, as Landge was caught by deputies in the act of taking pills out of the house and loading the trunk of his car with the drugs to hide them from law enforcement. Numerous drugs were recovered from the trunk of the vehicle to include approximately 416.98 grams of fentanyl pills. Landge confessed to participating in the same drug distribution scheme as Chebiam.
The case was investigated by the US Customs and Border Protection, 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.
Connecticut U.S. Attorney’s Office Celebrates Annual U.S. Attorney’s AwardsRead the Press Release
The United States Attorney’s Office annual law enforcement awards ceremony was celebrated yesterday in New Haven. The ceremony at the City of New Haven’s aldermanic chambers recognized approximately 160 individuals for their investigative work and other contributions to significant federal criminal prosecutions, civil cases, and community engagement efforts in Connecticut. The majority of recipients are members of federal, state, and local law enforcement agencies, including 16 municipal police departments in Connecticut and Massachusetts.
“This celebration recognizes the many valuable contributions of law enforcement professionals from police departments in cities and towns across Connecticut, those employed by state and federal agencies, and other dedicated individuals who regularly and actively join us in achieving the Office’s mission,” said U.S. Attorney Vanessa Roberts Avery. “That singular mission is to do justice – do the right and just thing, in every circumstance. It requires us to always stand firm in furtherance of our three primary and co-equal priorities: upholding the rule of law, safeguarding civil rights, and doing all we can to keep our residents and our communities safe. We know that our law enforcement collaborations have been, and continue to be, essential to achieving that goal, and we thank each recipient for their invaluable commitment. We are stronger and safer because of them.”
In addition to criminal and civil case awards that recognized investigators of violent crime, drug trafficking, national security, child exploitation, public corruption, financial fraud, health care fraud, and other matters, U.S. Attorney Avery presented three special awards during the ceremony.
The U.S. Attorney’s Award for Outstanding Investigator was presented to FBI New Haven Supervisory Special Agent Wendy Bowersox for her persistence and dedication that led to many federal and state prosecutions of dangerous human traffickers, and her empathy in interacting with trafficking victims, many of whom are often suspicious of law enforcement and fearful, and traumatized by the sexual, physical, and mental abuse they have suffered. Agent Bowersox was recently promoted to the position of profiler at the FBI’s Behavioral Analysis Unit in Quantico, Virginia.
The U.S. Attorney’s Outstanding Community Award was presented to DEA Special Agent Jonah Mazzacane and several individuals who have lost family members to overdose, who have presented to thousands of students across Connecticut about the dangers of fentanyl, other opioids, and counterfeit pills, through the U.S. Attorney’s Office’s HEAT program.
The U.S. Attorney’s Outstanding Partnership Award was presented to members of the FBI, Connecticut State Police, State’s Attorneys, and Assistant State’s Attorneys, who participate in United Against Hate events across the state. UAH helps raise community awareness about hate crimes, hate incidents, and discrimination, and is building bridges between law enforcement and community, ethnic, and religious groups, particularly those with members who have been reluctant to contact law enforcement for help.
U.S. Attorney Avery also recognized members of the FBI, ATF, Bridgeport Police Department, and the U.S. Attorney’s Office, who recently won an Executive Office for United States Attorneys (EOUSA) Award for Superior Performance by a Litigative Team for their investigation and prosecution of 47 members and associates of three Bridgeport gangs who terrorized city residents from 2015 to 2022. The investigation solved eight murders and approximately 20 attempted murders.
The U.S. Attorney’s Office is charged with enforcing federal criminal laws in Connecticut and representing the federal government in civil litigation. The Office is composed of approximately 68 Assistant U.S. Attorneys and 57 staff members at offices in New Haven, Bridgeport, and Hartford.
For more information about the U.S. Attorney’s Office for the District of Connecticut, please visit www.justice.gov/ct.
California Home Health Agency and Owner Settle False Claims Act Allegations Relating to Improper Paycheck Protection Program LoanRead the Press Release
Allstar Health Providers Inc., a California home health agency, and its owner, Maria Chua, have agreed to pay $399,990 to the United States to resolve allegations that they violated the False Claims Act when they knowingly received and retained more than one Paycheck Protection Program (PPP) loan prior to Dec. 31, 2020, in violation of PPP rules.
The PPP, an emergency loan program established by Congress in March 2020 under the Coronavirus Aid, Relief and Economic Security (CARES) Act and administered by the Small Business Administration (SBA), was intended to support small businesses struggling to pay employees and other business expenses during the COVID-19 pandemic. A borrower applying for a PPP loan was required to make multiple certifications relating to its eligibility and compliance with program rules. Among other things, PPP loan applicants in 2020 were required to certify that they would not receive more than one PPP loan prior to Dec. 31, 2020.
The United States alleged that Chua submitted two PPP loan applications on behalf of Allstar Health Providers in May 2020, and in both applications, she certified that the company would not receive more than one loan prior to Dec. 31, 2020. Despite these certifications, the United States alleged that Allstar Health Providers received two PPP loans in 2020, and thereafter knowingly and improperly retained the second, duplicate loan. According to the United States, Allstar Health Providers failed to repay the duplicate loan, which resulted in a loss to the SBA when it purchased the loan guaranty on the duplicate loan.
“PPP loans were intended to provide critical relief to small businesses,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to pursuing those who knowingly violated the requirements of the PPP or other COVID-19 assistance programs and obtained relief funds to which they were not entitled.”
“When an individual violates the False Claims Act by fraudulently receiving and retaining PPP loans, taxpayers lose,” said U.S. Attorney Martin Estrada for the Central District of California. “Those who violate the law by fraudulently receiving and retaining PPP loans will be held accountable.”
“This is another excellent example of the success of the combined investigative efforts of the Small Business Administration and the Department of Justice in aggressively pursuing instances of misconduct and recovering funds from those who choose to commit fraudulent acts against SBA’s COVID-relief programs,” said General Counsel Therese Meers of SBA.
The settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act by J. Bryan Quesenberry. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned U.S. ex rel. Quesenberry v. 2 Evil Geniuses et al., No. 20-cv-8495 (C.D. Cal.). Mr. Quesenberry will receive a total of approximately $60,000 in connection with this settlement.
The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Central District of California, with assistance from the SBA’s Office of General Counsel and Office of the Inspector General.
Trial Attorney Jared S. Wiesner of the Civil Division and Assistant U.S. Attorney Frank Kortum for the Central District of California handled the matter.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Justice Department in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The task force bolsters efforts to investigate and prosecute the most culpable domestic and international actors committing civil and criminal fraud and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit www.justice.gov/coronavirus.
Tips and complaints from all sources about potential fraud affecting COVID-19 government relief programs can be reported by visiting the webpage of the Civil Division’s Fraud Section, which can be found here. Anyone with information about allegations of attempted fraud involving COVID-19 can also report it by calling the Justice Department’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The claims resolved by the settlement are allegations only. There has been no determination of liability.
Settlement
CEO of Nigerian Airline and Co-Defendant Indicted for Obstruction of JusticeRead the Press Release
ATLANTA – Allen Onyema, the Chairman, CEO, and founder of Air Peace, a Nigerian airline, has been charged in a superseding indictment with obstruction of justice for submitting false documents to the government in an effort to end an investigation of him that resulted in earlier charges of bank fraud and money laundering. Ejiroghene Eghagha, the airline’s Chief of Administration and Finance, was also charged for participating in the obstruction scheme, as well as in the earlier bank fraud counts.
“After allegedly using his airline company as a cover to commit fraud on the United States’ banking system, Onyema, along with his co-defendant, allegedly committed additional crimes of fraud in a failed attempt to derail the government’s investigation of his conduct,” said U.S. Attorney Ryan K. Buchanan. “The diligence of our federal investigative partners revealed the defendants’ alleged obstruction scheme, making it possible for the defendants to be held accountable for their aggravated conduct of attempting to impede a federal investigation.”
“These cases represent the continued commitment of the Drug Enforcement Administration to identify and hold accountable those who engaged in fraud and money laundering,” said Robert J. Murphy, Special Agent in Charge of the DEA Atlanta Division.
“Allegedly, Onyema and his accomplices fraudulently used the U.S. banking system in an effort to hide the source of their ill-gotten money,” said Assistant Special Agent in Charge Lisa Fontanette, Internal Revenue Service - Criminal Investigation Atlanta Field Office. “Today’s superseding indictment is indicative of the dedication IRS-CI special agents and our law enforcement partners have, as part of the Organized Crime Drug Enforcement Task Forces, to neutralize threats to the United States from criminal organizations.”
“The charges announced today demonstrate the criticality of diligence and truth in criminal justice proceedings,” said Steven N. Schrank, Acting Special Agent in Charge, Homeland Security Investigations Atlanta that covers Georgia and Alabama. “HSI and our partners are committed to pursuing those who seek to exploit our nation’s financial system and any efforts to cover up illegal activity.”
According to U.S. Attorney Buchanan, the superseding indictment, and other information presented in court: Onyema, a Nigerian citizen and businessman, is the CEO and Chairman of Air Peace, a Nigerian airline founded in 2013. Between 2010 and 2018, Onyema travelled frequently to Atlanta, where he opened several personal and business bank accounts. More than $44.9 million was allegedly transferred into his Atlanta-based accounts from foreign sources.
Beginning in approximately May 2016, Onyema, together with Eghagha, allegedly used a series of export letters of credit to cause banks to transfer more than $20 million into Atlanta-based bank accounts controlled by Onyema. The letters of credit were purportedly to fund the purchase of five separate Boeing 737 passenger planes by Air Peace and were supported by documents such as purchase agreements, bills of sale, and appraisals. The documents purported to show that Air Peace was purchasing the aircraft from Springfield Aviation Company LLC, a business registered in Georgia.
However, the supporting documents were allegedly fake – Springfield Aviation Company LLC was owned by Onyema and managed on his behalf by a person with no connection to the aviation business, and Springfield Aviation never owned the aircraft. The company that allegedly drafted the appraisals did not exist. Eghagha allegedly participated in this scheme as well, directing the Springfield Aviation manager to sign and send false documents to banks and even using the manager’s identity to further the fraud. After Onyema received the money in the United States, he allegedly laundered over $16 million of the proceeds of the fraud by transferring it to other accounts.
In May 2019, upon discovering that he was under investigation in the Northern District of Georgia for bank fraud, Onyema and Eghagha allegedly directed the Springfield Aviation manager to sign a key business contract, but also specifically told her to not date the document. In October 2019, Onyema allegedly caused his attorneys to present that same contract, now falsely dated as being signed on May 5, 2016 (prior to the bank fraud that began in 2016), to the government in an effort to stop the investigation and unfreeze his bank accounts.
Allen Ifechukwu Athan Onyema, 61, of Lagos, Nigeria, and Ejiroghene Eghagha, 42, of Lagos, Nigeria, were indicted on November 19, 2019, on one count of conspiracy to commit bank fraud, three counts of bank fraud, one count of conspiracy to commit credit application fraud, and three counts of credit application fraud. Additionally, Onyema was charged with 27 counts of money laundering, and Eghagha was charged with one count of aggravated identity theft. On October 8, 2024, they were both charged in a superseding indictment alleging an additional count of obstruction of justice and one count of conspiracy to obstruct justice. The case is criminal action number 1:19-CR-464.
Members of the public are reminded that the indictments only contain charges. The defendants are presumed innocent of the charges and it will be the government’s burden to prove the defendants’ guilt beyond a reasonable doubt at trial.
The Drug Enforcement Administration, Internal Revenue Service Criminal Investigation, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, Federal Aviation Administration, Department of Commerce, and Department of Treasury are investigating this case.
Assistant U.S. Attorneys Garrett L. Bradford and Christopher J. Huber are prosecuting the case.
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.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Baton Rouge Man Sentenced to 18 Months in Federal Prison for EscapeRead the Press Release
United States Attorney Ronald C. Gathe, Jr. announced that U.S. District Judge John W. deGravelles sentenced Deshawn Henderson, age 26, of Baton Rouge, Louisiana, to 18 months in federal prison following his conviction for escape. The Court further sentenced Henderson to serve three years of supervised release following his term of imprisonment.
According to admissions made as part of his guilty plea, in 2022, Henderson was sentenced to 50 months in federal prison following his conviction for possession of firearms by a convicted felon. In February 2024, prior to completing his sentence, Henderson was assigned to City of Faith Residential Reentry Center, a community corrections facility located in Baton Rouge, Louisiana, to serve the remainder of his federal sentence. On the evening of April 1, 2024, employees at City of Faith directed Henderson to submit to a urinalysis and a breath analysis. While he was being escorted to a security trailer at the facility to be tested, he became irate and began to damage the interior of the security trailer. Shortly thereafter, the defendant exited the facility without permission and did not return. Henderson’s whereabouts remained unknown for about 14 days, when he surrendered to the U.S. Marshals Service on the evening of April 15, 2024.
This case was investigated by the U.S. Marshals Service and was prosecuted by Assistant United States Attorney Stephen R. Vick, Jr.
Arraignment Held for Four Charged in Connection with a September 2023 Murder in a Southwest Apartment BuildingRead the Press Release
WASHINGTON – Keyshawn Lavender, 23, Deandre Sams, 28, Raymond Mathis, 37, of Washington, D.C., and Deandre Christian, 30, of Fort Washington, MD, were arraigned in Superior Court today on a superseding indictment charging Lavender, Sams, and Mathis with conspiracy to commit robbery, first degree felony murder while armed, and related charges for the September 5, 2023 murder of 32-year-old Matthew Miller. Christian was arraigned on an assault with intent to kill charge for shooting from the balcony of an apartment building.
The superseding indictment was announced by United States Attorney Matthew M. Graves and Chief Pamela Smith of the Metropolitan Police Department. All four defendants were arraigned before Superior Court Judge Anthony Epstein.
According to the superseding indictment, Lavender, Mathis, and Sams conspired to rob and shoot Matthew Miller inside an apartment at 222 M Street, Southwest, Washington, D.C. Christian is charged for an alleged retaliatory shooting immediately after the murder.
The defendants entered pleas of not guilty and remain held pending trial. Lavender, Sams, and Mathis are scheduled for trial on September 8, 2025; a trial date for Christian has not yet been set.
In announcing the charge, U.S. Attorney Graves commended the work of those investigating the case from the Metropolitan Police Department (MPD) and the U.S. Attorney’s Office. The case is being prosecuted by Assistant U.S. Attorney Sarah Prins.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
2024-09-18_superseding_indictment_docketed_9-20.pdfAnnual Awards Ceremony Recognizes Outstanding Contributions from Western Pennsylvania Law Enforcement Officers and ProsecutorsRead the Press Release
PITTSBURGH, Pa. - The Law Enforcement Agency Directors (LEAD) of Western Pennsylvania recognized more than three dozen area law enforcement officers and prosecutors during its 26th Annual LEAD Awards Ceremony, announced United States Attorney Eric G. Olshan. Comprising the Western Pennsylvania heads of federal, state, and local law enforcement agencies, LEAD bestows awards annually as a way of recognizing outstanding performance from law enforcement agents and officers, as well as prosecutors.
Notable among the LEAD Awards presented were:
• The Lifetime Service Award was presented to (Retired) Supervisory Special Agent Louis “Lou” Weiers for his outstanding service with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Weiers began his career with the ATF in January 1991 as a Special Agent with the Pittsburgh field office’s Arson/Explosives group, also serving as a member of the National Response Team from 1998 until 2005. Weiers was promoted to Resident Agent in Charge of the Pittsburgh Firearms Trafficking and Violent Crime group in March 2005, and was among the longest tenured supervisory investigators within the ATF upon his September 2024 retirement. Among the many investigations on which he worked during his career, Weiers served as the first-line supervisor at the 2018 Tree of Life shooting in Pittsburgh, where his group led the ATF response and firearms investigation with the Federal Bureau of Investigation (FBI); represented ATF at the September 11, 2001, Flight 93 crash site in Shanksville, Pennsylvania; and was involved in the 2014 48-day manhunt for Eric Frein, who killed a Pennsylvania State Trooper and critically injured another during an attack at a State Police barracks. Weiers also served in several acting Assistant Special Agent in Charge details within the Philadelphia Field Division throughout the decades.
• The Courage Under Hostile Fire Award was presented to Pittsburgh Bureau of Police Officer Craig Claflin, who, as the first officer on the scene of a domestic dispute call at a Kincaid Street residence in Pittsburgh’s Garfield neighborhood in July 2024, was immediately fired upon by the assailant. Officer Claflin quickly neutralized, disarmed, and detained the assailant, saving lives and preventing injuries to neighboring civilians and fellow law enforcement officers.
• An individual LEAD award was presented to Assistant U.S. Attorney Katherine Jordan of the U.S. Attorney’s Office. AUSA Jordan’s work has consistently involved the handling of both complex, long-term investigations and prosecutions of violent individuals and drug traffickers. During the past year, her cases included multiple long-term drug trafficking investigations conducted by FBI’s Greater Pittsburgh Safe Streets Task Force—one of which was a Title-III wiretap investigation—as well as a long-term Drug Enforcement Administration investigation into a large-scale drug trafficking organization, the latter of which included the execution of multiple search warrants in late-June 2024 that ultimately resulted in the seizure of nearly 120 kilograms of cocaine, over $1.2 million in cash, and eight firearms, in addition to the charging of numerous individuals. In September 2024, shortly after the takedown of her FBI Title-III investigation, AUSA Jordan secured a guilty verdict in the jury trial of local large-scale drug trafficker Leon Ford Sr., whom Jordan and her team of investigators had indicted and successfully convicted of conspiracy to distribute five kilograms or more of cocaine and 400 grams or more of fentanyl, as well as possession with intent to distribute 400 grams or more of fentanyl.
• Several individuals from the ATF, along with Assistant U.S. Attorney Maureen Sheehan-Balchon of the U.S. Attorney’s Office, received a team award for outstanding performance for their seven-month investigation and prosecution of a complex illegal firearms manufacturing and distribution network out of Altoona, Pennsylvania. The criminal conspiracy involved the manufacture and sale of untraceable ghost guns, AR-15 style rifles, and “hit kits” containing a Polymer 80 privately made firearm with no serial number, a threaded barrel to attach an included silencer, subsonic ammunition, and latex gloves.
• Members of the Mt. Lebanon Police Department, Allegheny County Police Department, Allegheny County Sheriff’s Office, and FBI received a team award for their investigation of a series of crimes involving the sexual exploitation of children.
• Corporals and troopers from Pennsylvania State Police Troops B and D Forensic Services Units were honored with a team award for their processing of a particularly complex Pittsburgh crime scene.
• Two U.S. Postal Inspection Service officials received individual LEAD awards for their roles in helping to uncover and disrupt criminal operations in separate investigations involving, in one case, a California-to-Western Pennsylvania drug trafficking network, and, in the other, a games of chance theft ring. Officers and agents from organizations including the Allegheny County Sheriff’s Office, ATF, FBI, Homeland Security Investigations, Internal Revenue Service – Criminal Investigation, and Pennsylvania State Police also received individual awards for their performance in a variety of incidents and investigations involving firearms, narcotics, sexual exploitation of minors, tax evasion, and public safety.
LEAD is composed of the following law enforcement agencies: Bureau of Alcohol, Tobacco, Firearms and Explosives; Drug Enforcement Administration; Federal Bureau of Investigation; U.S. Attorney’s Office, Western District of Pennsylvania; Homeland Security Investigations; Internal Revenue Service - Criminal Investigation; U.S. Department of Homeland Security, Transportation Security Administration; U.S. Department of Defense - Defense Criminal Investigative Service; U.S. Department of Housing and Urban Development; U.S. Marshals Service; U.S. Postal Service Office of Inspector General; U.S. Postal Inspection Service; U.S. Probation & Pretrial Services; United States Secret Service; U.S. Social Security Administration – Office of Inspector General; U.S. Department of State – Diplomatic Security Service; U.S. Department of Transportation, Federal Air Marshal Service; U.S. Department of Transportation - Office of Inspector General; U.S. Department of Veterans Administration - Office of Inspector General; U.S. Department of Labor - Office of Inspector General; U.S. Department of Agriculture - Office of Inspector General; U.S. Department of Homeland Security – Federal Protective Service; U.S. Food and Drug Administration – Office of Criminal Investigations; Pennsylvania Office of Attorney General; Pennsylvania State Police; Pennsylvania Board of Probation and Parole; Western Pennsylvania Chiefs of Police Association; Allegheny County Police Department; Allegheny County Sheriff’s Office; Allegheny County District Attorney’s Office; Allegheny County Chiefs of Police Association; Allegheny County Housing Authority Police Department; Port Authority of Allegheny County Police Department; Washington County District Attorney’s Office; Westmoreland County District Attorney’s Office; Pittsburgh Bureau of Police; Mt. Lebanon Police Department; Carnegie Mellon University Police Department, and University of Pittsburgh Department of Public Safety.
10 October 2024
Wagoner Resident Sentenced for Illegal Possession of Explosive Devices and MachinegunRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Brock Lucas Shields, age 59, of Wagoner, Oklahoma, was sentenced to a term of three years’ probation for one count of Engaging in the Business of Manufacturing and Dealing in Explosive Materials without a License, and three years’ probation for one count of Illegal Possession of a Machinegun. The terms are set to be served concurrently, with the first six months to be served under house arrest.
The charges arose from an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
On November 9, 2023, Shields pleaded guilty to the charges. According to investigators, on December 16, 2022, ATF and TFO agents executed a federal search warrant on Shields’ Wagoner residence and discovered Shields in possession of 132 illegal flash powder explosive devices and raw materials for manufacturing devices. At the time of the search, Shields did not possess a federal explosives license to import, manufacture, or distribute explosive materials. Agents conducting the search also discovered two machine guns, one 7.62x39mm caliber firearm modified for full automatic firing with a single trigger pull, and one 5.56mm caliber firearm modified for full automatic firing with a single trigger pull.
The Honorable Ronald A. White, Chief Judge in the United States District Court for the Eastern District of Oklahoma, presided over the hearing.
Assistant U.S. Attorney Lewis Reagan represented the United States.
Utah Fraudster Sentenced for Selling 120,000 Fake COVID-19 Vaccination Record CardsRead the Press Release
SALT LAKE CITY, Utah – The lead defendant in a scheme that manufactured, sold and distributed 120,000 counterfeit COVID-19 vaccination record cards was sentenced today.
Nicholas Frank Sciotto, 34, of Salt Lake City, was sentenced by U.S. District Court Judge Tena Campbell to 12 months’ imprisonment, three years supervised release, and ordered by the court to pay a $40,000 fine, after he admitted in July 2024 that he conspired to defraud the U.S. Department of Health and Human Services and the Center for Disease Control and Prevention (CDC) by selling and distributing counterfeit COVID-19 vaccination record cards. In turn, Sciotto obtained over approximately $400,000 in profits.
U.S. Dept. of Health and Human Services-OIGAccording to court documents and statements made at Sciotto’s sentencing hearing, between March 2021 and September 2021, Sciotto promoted, manufactured, sold, and distributed illegal and counterfeit COVID-19 vaccination record cards across the country. He also sold the COVID-19 vaccination record cards wholesale to several coconspirators, including Kyle Blake Burbage, 33, of Goose Creek, South Carolina. Together, the coconspirators enabled numerous people to use fake vaccination record cards to masquerade as being vaccinated, so they could evade public health and safety protocols across the nation. Sciotto engaged in this scheme–without regard for any public health consequences or risks that he exposed individuals to during the pandemic, without their knowledge or consent, and he undermined the CDC’s COVID-19 vaccination program and other governmental health and safety regulations and protocols at significant profit.
U.S. Dept. of Health and Human Services-OIGOn Facebook, Sciotto sold each card for $10 with a 10 card minimum per order, plus $5 for shipping and directed buyers to a mobile payment service to complete the transaction. In furtherance of the crime, Sciotto made a fake badge and identified himself as a volunteer with a major COVID-19 testing company in Utah to trick a print shop worker into believing Sciotto worked for a hospital and was authorized to print out thousands of copies of COVID-19 vaccination record cards.
United States Attorney Trina A. Higgins for the District of Utah made the announcement.
The case was investigated jointly by the U.S Department of Health and Human Services – Office of Inspector General (HHS-OIG) and the FBI Salt Lake City Field Office.
Assistant United States Attorney Todd C. Bouton and Special Assistant United States Attorney Sachi J. Jepson of the U.S. Attorney’s Office for the District of Utah prosecuted the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus and https://www.justice.gov/coronavirus/combatingfraud
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
U.S. Attorney’s Office Reaches Settlement with Inland Northwest Behavioral Health to Ensure Compliance with the Americans with Disabilities ActRead the Press Release
Spokane, WA – Vanessa R. Waldref, United States Attorney for the Eastern District of Washington, announced that Inland Northwest Behavioral Health has agreed to take remedial measures over the next two years and pay ten thousand dollars in compensatory damages to resolve alleged violations of Title III of the Americans with Disability Act (ADA).
A former patient of Inland Northwest Behavioral Health alleged that he was required to provide documentation of a service animal in violation of the ADA’s requirements, that he was not allowed to conduct visitation indoors with the service animal, and that he was segregated from other patients of Inland Northwest Behavioral Health while utilizing the service animal.
Inland Northwest Behavioral Health fully and promptly cooperated with the investigation and agreed to take concrete remedial measures to comply with the ADA.
Under the terms of the settlement, Inland Northwest Behavioral Health is required to pay $10,000 in compensatory damages to the individual with disabilities. The settlement further requires Inland Northwest Behavioral Health to undertake the following:
- Implement and utilize a written Title III ADA service animal policy
- Require annual employee training addressing the requirements of the ADA
- Conspicuously post notices to patients and employees at the facility that service animals are welcome
- Submit reports to the United States Attorney’s Office every twelve months for the next two years certifying full compliance with all remedial terms of the agreement and self-reporting any allegations of violations of the ADA so they can be fully investigated.
“The Americans with Disabilities Act provides individuals many protections, including the use of service animals. This agreement compels Inland Northwest Behavioral Health to take steps to make sure this right is protected for individuals in the future.” stated U.S. Attorney Waldref. “My office will continue to protect the civil rights of all citizens in our district.”
The settlement was the result of a complaint filed on ADA.gov and the resulting investigation conducted by the U.S. Attorney’s Office for the Eastern District of Washington. The public is encouraged to report suspected ADA violations at ADA.gov, or individuals can report suspected ADA violations directly to the U.S. Attorney’s Office at [email protected] or by calling the Civil Rights Complaint Line at (509) 835-6306. The full settlement agreement, including the required Service Animal Policy, is available at the bottom of this page.
Assistant United States Attorney Jacob E. Brooks of the Eastern District of Washington handled the matter on behalf of the United States.
settlement_agreement_sept_2024_v.1.pdfTwo Former Arkansas Sheriff’s Deputies Sentenced to Prison for Federal Civil Rights OffencesRead the Press Release
FORT SMITH - Two former Crawford County, Arkansas, sheriff’s deputies, have been sentenced to federal prison for federal civil rights offenses for using unlawful force on a man they arrested.
The Honorable Chief Judge Susan O. Hickey presided over the sentencing hearings, which took place in the United States District Court in Fort Smith.
Today, Zackary King, age 28, was sentenced to 12 months, in federal prison followed by one year of supervised release for Deprivation of Rights Under Color of Law. On October 9, 2024, Levi
White, age 33, was sentenced to 63 months, in federal prison followed by two years of supervised release for Deprivation of Rights Under Color of Law.
According to court documents, White, King, and a third officer approached a man identified as R.W. in a gas station parking lot on August 21, 2022, during their investigation into a person threatening a store attendant. R.W. lunged at White and tackled him, then all three officers quickly subdued
R.W. and pinned him to the ground. After R.W. was pinned to the ground and no longer fighting the officers, King kicked R.W. in the back and struck R.W. once in the midsection with his fist. At approximately the same time, White punched R.W. at least nine times in the head, then lifted R.W.’s head and slammed it into the pavement. The third officer did not strike R.W. R.W. suffered head injuries from the assault.
U.S. Attorney Clay Fowlkes of the Western District of Arkansas made the announcement.
The FBI Little Rock Field Office, Arkansas State Police, and ARKTrust Task Force investigated the case.Assistant U.S. Attorneys Dustin Roberts and Devon Still for the Western District of Arkansas and
Special Litigation Counsel Michael J. Songer and Trial Attorney Lia Rettammel of the Civil Rights
Division prosecuted the case.
Related court documents may be found on the Public Access to Electronic Records website at www.pacer.gov.Three Maryland Individuals Charged for Leading Roles in International Organized Theft RingRead the Press Release
Greenbelt, Maryland – On October 7, 2024, Sindy Paola Hernandez, age 38, of Hyattsville, Maryland, Johnsie Steven Reina Hernandez, age 20, of Hyattsville, Maryland, and Edwin Gonzalez Rodriguez, age 30, of Hyattsville, Maryland, were charged by criminal complaint with conspiracy to commit interstate transportation of stolen goods. The charges involve a large-scale organized retail theft ring, wherein conspirators stole cosmetic and other products from various retail establishments and provided them to Hernandez, Reina Hernandez, and Gonzalez Rodriguez. As outlined in the affidavit in support of the complaint, it is alleged that these individuals then shipped the stolen products to other countries, including Honduras.
The charges are announced by Erek L. Barron, U.S. Attorney for the District of Maryland; Special Agent in Charge Michael S. McCarthy of Homeland Security Investigations (HSI); Special Agent in Charge Kareem A. Carter of the Internal Revenue Service - Criminal Investigation (IRS-CI); and Chief Marc R. Yamada of the Montgomery County Police Department (MCPD).
According to the affidavit in support of the criminal complaint, in November 2022, retail investigators including Target, Ulta Beauty, CVS, and Walmart began an investigation after large-scale thefts occurred targeting premium skincare products, vitamins, and cold/cough medicine. The investigation revealed that the thefts were committed by various individuals referred to as “boosters.” The boosters frequently indicated that they were selling the stolen products to Hernandez, who resided in Prince George’s County. In turn, Hernandez, Reina Hernandez, and Gonzalez Rodriguez would store and sort the products at their residences and storage units, and then ship the stolen products to Honduras.
A complaint is not a finding of guilt. All defendants charged by complaint are presumed innocent unless and until proven guilty at some later criminal proceedings.
This case 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.
U.S. Attorney Barron commended HSI, the IRS, MCPD, and the various retail establishments, for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Kelly O. Hayes and Dawn Williams, who are prosecuting the federal case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Three Assistant U.S. Trustees Appointed for U.S. Trustee Program Offices in Missouri, Ohio and WashingtonRead the Press Release
The Justice Department’s Executive Office for U.S. Trustees announced today the appointment of three Assistant U.S. Trustees to offices in Missouri, Ohio and Washington.
Jill Parsons was appointed in September as the Assistant U.S. Trustee for the Kansas City office, which serves the Western District of Missouri (Region 13). Before joining the U.S. Trustee Program (USTP), Parsons served as a chapter 7 panel trustee since 2009 and practiced bankruptcy law, representing both creditors and debtors in Kansas City for over 20 years. Parsons received her bachelor’s degree in English from Weber State University and her law degree with honors from the University of Missouri-Kansas City.
Angela Abreu was appointed in August as the Assistant U.S. Trustee for the Cleveland office, which serves the Northern District of Ohio (Region 9). Abreu joined the USTP after several years in private practice specializing in creditors’ rights and chapter 7 bankruptcy practice. Most recently, Abreu was a corporate vice president and loss mitigation manager at a regional bank. Abreu received her bachelor’s degree in psychology and general administration of justice from Saint Vincent College and her law degree cum laude from Duquesne University.
Hilary Mohr was appointed in August as the Assistant U.S. Trustee for the Seattle office, which serves the Western District of Washington and the District of Alaska (Region 18). Mohr joined the USTP as a trial attorney in the Seattle office in January 2016 after working as a partner at a Seattle law firm focused primarily on creditors’ rights litigation and bankruptcy matters. Mohr received her bachelor’s degree in political science from University of Washington, worked in the nonprofit sector and received a law degree summa cum laude from Seattle University.
The USTP’s mission is to promote the integrity and efficiency of the bankruptcy system for the benefit of all stakeholders – debtors, creditors and the public. The USTP consists of 21 regions with 89 field offices nationwide and an Executive Office in Washington, D.C. Learn more about the USTP at www.justice.gov/ust.
Theology Professor Charged with Possessing Pornographic Images of ToddlersRead the Press Release
A theology professor who allegedly stored pornographic images of children on his work computer has been federally charged, announced U.S. Attorney for the Northern District of Texas Leigha Simonton.
Charles Kilby Bellinger, 62, a professor of theology and librarian at the Brite Divinity School at Texas Christian University, was charged via criminal complaint with possession of child pornography and arrested on Oct. 4.
The federal investigation began after TCU’s IT staff reported they had detected pornographic images with concerning file names, including “infant” and “toddler,” on Dr. Bellinger’s work computer.
On a hard drive and an SD card removed from Dr. Bellinger’s office, investigators found multiple sexually explicit images of pre-pubescent minors.
At a detention hearing on Thursday, an agent testified that law enforcement also seized multiple encrypted devices from a locked safe in his office. Forensic investigation of those devices is ongoing.
A criminal complaint is merely an allegation of criminal conduct, not evidence. Like all defendants, Dr. Bellinger is presumed innocent until proven guilty in a court of law.
If convicted, he faces up to 20 years in federal prison.
The U.S. Secret Service and the Fort Worth Police Department’s Internet Crimes Against Children Unit conducted the investigation with the Texas Christian University Campus Police. Assistant U.S. Attorney Aisha Saleem is prosecuting the case.
Teva Pharmaceuticals Agrees to Pay $425 Million to Resolve Kickback AllegationsRead the Press Release
BOSTON – Teva Pharmaceuticals USA, Inc. and Teva Neuroscience, Inc. (collectively Teva) have agreed to pay $425 million to resolve allegations that Teva paid kickbacks via two co-pay assistance foundations in violation of the Anti-Kickback Statute (AKS) and False Claims Act.
The government’s complaint, filed in 2020, alleged that from 2006 to 2017, Teva manipulated the co-pay foundation assistance system by conspiring with multiple third parties, including a specialty pharmacy and two allegedly independent co-pay assistance foundations, to direct its supposed charitable payments specifically to patients taking its own multiple sclerosis drug, Copaxone. At the same time, Teva steadily raised Copaxone’s price by thousands of dollars. The United States alleges that this conduct violated the AKS and caused the submission of false claims to Medicare. The settlement was reached after the government’s review of Teva’s financial disclosures concerning its financial condition.
This settlement is the latest in a string of enforcement actions against pharmaceutical companies that allegedly used third-party foundations as conduits to pay kickbacks. Since 2017, the United States Attorney’s Office in Massachusetts has collected over $1.4 billion from this enforcement initiative. The U.S. Attorney’s Office has also settled with four of the third-party foundations that participated in this conduct and a specialty pharmacy. Today’s resolution with Teva is the largest co-pay assistance settlement to date.
When a Medicare beneficiary obtains a prescription drug covered by Medicare Part B or Part D, the beneficiary is often required to make a partial payment, which may take the form of a co-payment, co-insurance, or deductible (collectively “co-pays”). These co-pay obligations may be substantial for expensive medications. Congress included co-pay requirements in these programs, in part, to encourage market forces to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs. The AKS prohibits pharmaceutical companies from offering or paying, directly or indirectly, any remuneration – which includes money or any other thing of value – to induce Medicare patients to purchase the companies’ drugs.
“For far too long, Teva gamed the charitable foundation process by paying kickbacks through two foundations, and with the aid of a specialty pharmacy. Those kickbacks undermined the purpose of the Medicare co-pay system and violated the Anti-Kickback Statute,” said Acting United States Attorney Joshua S. Levy. “This Office has taken the leading role in cracking down on these highly lucrative schemes that drive up the cost of essential drugs by bringing multiple enforcement actions that have returned more than $1 billion to the Medicare system. We will continue to pursue these actions to ensure that all pharmaceutical companies play by the rules and to protect the American taxpayers.
“Kickbacks designed to induce referrals or purchases of healthcare goods or services distort physician and patient decision-making, thwart competition and bypass controls put in place to protect federal health care programs,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The Justice Department is committed to pursuing those who engage in kickback violations, including drug manufacturers, to ensure that federal health care programs continue to serve the interests of taxpayers and program beneficiaries.”
“Pharmaceutical companies that disguise kickbacks as charitable donations to subsidize co-pays for their own drugs undermine a critical safeguard against the excessive inflation of drug prices. The costs of these schemes are ultimately passed on to consumers and taxpayers,” said Roberto Coviello, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General. “Such conduct cannot be tolerated within our health care system, and we will continue to vigorously pursue such allegations.”
“Today’s record-breaking settlement with Teva Pharmaceuticals is a victory for the public and highlights the FBI’s commitment to safeguarding the financial integrity of the Medicare program,” said Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “Pharmaceutical companies that look to bolster their drug prices by paying illegal kickbacks – whether directly or indirectly – undermine taxpayer funded healthcare programs and compromise patient care. The FBI will continue to pursue these investigations until pharmaceutical companies stop engaging in this conduct.”
Acting U.S. Attorney Levy, Principal Deputy AAG Boynton, HHS-OIG SAC Coviello and FBI SAC Cohen made the announcement today. The matter was handled by Assistant U.S. Attorney Abraham R. George, Chief of the Civil Division; Assistant U.S. Attorneys Diane Seol and Evan Panich of the U.S. Attorney’s Office for the District of Massachusetts; and Trial Attorneys Douglas Rosenthal and Nelson Wagner of the Justice Department’s Civil Division.
The civil action in Massachusetts is captioned United States v. Teva Pharmaceuticals USA, Inc., et al., No. 20-cv-11548 (D. Mass.).
TD Bank Pleads Guilty to Bank Secrecy Act and Money Laundering Conspiracy Violations in $1.8B ResolutionRead the Press Release
NEWARK, N.J. – TD Bank, N.A. (TDBNA), the 10th largest bank in the United States, and its parent company TD Bank US Holding Company (TDBUSH) (together with TDBNA, “TD Bank”) pleaded guilty today and agreed to pay over $1.8 billion in penalties to resolve the U.S. Attorney’s Office for the District of New Jersey and the Justice Department’s investigation into violations of the Bank Secrecy Act (BSA) and money laundering.
TDBNA pleaded guilty before U.S. District Judge Esther Salas in Newark federal court to conspiring to fail to maintain an anti-money laundering (AML) program that complies with the BSA, fail to file accurate Currency Transaction Reports (CTRs), and launder money. TDBUSH pleaded guilty to causing TDBNA to fail to maintain an AML program that complies with the BSA and to fail to file accurate CTRs.
TD Bank’s guilty pleas are part of a coordinated resolution with the Board of Governors of the Federal Reserve System (FRB), as well as the Treasury Department’s Office of the Comptroller of the Currency (OCC) and Financial Crimes Enforcement Network (FinCEN).
“By making its services convenient for criminals, TD Bank became one,” said Attorney General Merrick B. Garland. “Today, TD Bank also became the largest bank in U.S. history to plead guilty to Bank Secrecy Act program failures, and the first US bank in history to plead guilty to conspiracy to commit money laundering. TD Bank chose profits over compliance with the law — a decision that is now costing the bank billions of dollars in penalties. Let me be clear: our investigation continues, and no individual involved in TD Bank’s illegal conduct is off limits.”
“TD Bank prioritized growth and convenience over following its legal obligations. As a result of staggering and pervasive failures in oversight, it willfully failed to monitor trillions of dollars of transactions – including those involving ACH transactions, checks, high-risk countries, and peer-to-peer transactions – which allowed hundreds of millions of dollars from money laundering networks to flow through the bank, including for international drug traffickers. The bank was aware of these risks and failed to take steps to protect against them, including for two networks prosecuted in New Jersey and elsewhere – one that dumped piles of cash on the bank’s counters and another that allegedly withdrew amounts from ATMs 40 to 50 times higher than the daily limit for personal accounts.”
U.S. Attorney Philip R. Sellinger
“For years, TD Bank starved its compliance program of the resources needed to obey the law. Today’s historic guilty plea, including the largest penalty ever imposed under the Bank Secrecy Act, offers an unmistakable lesson: crime doesn’t pay — and neither does flouting compliance,” said Deputy Attorney General Lisa Monaco. “Every bank compliance official in America should be reviewing today’s charges as a case study of what not to do. And every bank CEO and board member should be doing the same. Because if the business case for compliance wasn’t clear before — it should be now.”
“For nearly a decade, TD Bank failed to update its anti-money laundering compliance program to address known risks. As bank employees acknowledged in internal communications, these failures made the bank an ‘easy target’ for the ‘bad guys.’ These failures also allowed corrupt bank employees to facilitate a criminal network’s laundering of tens of millions of dollars,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division. “U.S. financial institutions are the first line of defense against money laundering and illicit finance. When they participate in crime rather than prevent it, we will not hesitate to hold them accountable to the fullest extent of the law.”
According to court documents, between January 2014 and October 2023, TD Bank had long-term, pervasive, and systemic deficiencies in its U.S. AML policies, procedures, and controls but failed to take appropriate remedial action. Instead, senior executives at TD Bank enforced a budget mandate, referred to internally as a “flat cost paradigm,” requiring that TD Bank’s budget not increase year-over-year, despite its profits and risk profile increasing significantly over the same period. Although TD Bank maintained elements of an AML program that appeared adequate on paper, fundamental, widespread flaws in its AML program made TD Bank an “easy target” for perpetrators of financial crime.
Over the last decade, TD Bank’s federal regulators and TD Bank’s own internal audit group repeatedly identified concerns about its transaction monitoring program, a key element of an appropriate AML program necessary to properly detect and report suspicious activities. Nonetheless, from 2014 through 2022, TD Bank’s transaction monitoring program remained effectively static, and did not adapt to address known, glaring deficiencies; emerging money laundering risks; or TD Bank’s new products and services. For years, TD Bank failed to appropriately fund and staff its AML program, opting to postpone and cancel necessary AML projects prioritizing a “flat cost paradigm” and the “customer experience.”
Throughout this time, TD Bank intentionally did not automatically monitor all domestic automated clearinghouse (ACH) transactions, most check activity, and numerous other transaction types, resulting in 92% of total transaction volume going unmonitored from Jan. 1, 2018, to April 12, 2024. This amounted to approximately $18.3 trillion of transaction activity. TD Bank also added no new transaction monitoring scenarios and made no material changes to existing transaction monitoring scenarios from at least 2014 through late 2022; implemented new products and services, like Zelle, without ensuring appropriate transaction monitoring coverage; failed to meaningfully monitor transactions involving high-risk countries; instructed stores to stop filing internal unusual transaction reports on certain suspicious customers; and permitted more than $5 billion in transactional activity to occur in accounts even after the bank decided to close them.
TD Bank’s AML failures made it “convenient” for criminals, in the words of its employees. These failures enabled three money laundering networks to collectively transfer more than $670 million through TD Bank accounts between 2019 and 2023. Between January 2018 and February 2021, one money laundering network processed more than $470 million through the bank through large cash deposits into nominee accounts. The operators of this scheme provided employees gift cards worth more than $57,000 to ensure employees would continue to process their transactions. And even though the operators of this scheme were clearly depositing cash well over $10,000 in suspicious transactions, TD Bank employees did not identify the conductor of the transaction in required reports. In a second scheme between March 2021 and March 2023, a high-risk jewelry business moved nearly $120 million through shell accounts before TD Bank reported the activity. In a third scheme, money laundering networks deposited funds in the United States and quickly withdrew those funds using ATMs in Colombia. Five TD Bank employees conspired with this network and issued dozens of ATM cards for the money launderers, ultimately conspiring in the laundering of approximately $39 million. The Justice Department has charged over two dozen individuals across these schemes, including two bank insiders. TD Bank’s plea agreement requires continued cooperation in ongoing investigations of individuals.
As part of the plea agreement, TD Bank has agreed to forfeit $452,432,302.00 and pay a criminal fine of $1,434,513,478.40, for a total financial penalty of $1,886,945,780.40. TD Bank has also agreed to retain an independent compliance monitor for three years and to remediate and enhance its AML compliance program. TD Bank has separately reached agreements with the FRB, OCC, and FinCEN, and the Justice Department will credit $123.5 million of the forfeiture toward the FRB’s resolution.
The Justice Department reached its resolution with TD Bank based on a number of factors, including the nature, seriousness, and pervasiveness of the offenses, as a result of which TD Bank became the bank of choice for multiple money laundering organizations and criminal actors and processed hundreds of millions of dollars in money laundering transactions. Although TD Bank did not voluntarily disclose its wrongdoing, it received partial credit for its strong cooperation with the Department’s investigation and the ongoing remediation of its AML program. TD Bank did not receive full credit for its cooperation because it failed to timely escalate relevant AML concerns to the Department during the investigation. Accordingly, the total criminal penalty reflects a 20% reduction based on the bank’s partial cooperation and remediation.
IRS Criminal Investigation, Federal Deposit Insurance Corporation Office of Inspector General, and Drug Enforcement Administration investigated the case. The Morristown Police Department, the U.S. Attorney’s Office for the District of Puerto Rico, Homeland Security Investigations, U.S. Customs and Border Protection, and the New York City Police Department provided substantial assistance.
Assistant U.S. Attorneys Mark J. Pesce of the Economic Crimes Unit and Angelica Sinopole for the District of New Jersey’s Health Care Fraud Unit and Trial Attorneys D. Zachary Adams and Chelsea R. Rooney of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) prosecuted the case.
MLARS’ Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers, and employees, whose actions threaten the integrity of the individual institution or the wider financial system. Since its creation in 2010, the Bank Integrity Unit has prosecuted financial institutions for violations of the BSA, money laundering, sanctions, and other laws, imposing total penalties of over $25 billion.
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.
tdbush.information.pdf tdbna.information.pdfTD Bank Pleads Guilty to Bank Secrecy Act and Money Laundering Conspiracy Violations in $1.8B ResolutionRead the Press Release
WASHINGTON — TD Bank N.A. (TDBNA), the 10th largest bank in the United States, and its parent company TD Bank US Holding Company (TDBUSH) (together with TDBNA, TD Bank) pleaded guilty today and agreed to pay over $1.8 billion in penalties to resolve the Justice Department’s investigation into violations of the Bank Secrecy Act (BSA) and money laundering.
TDBNA pleaded guilty to conspiring to fail to maintain an anti-money laundering (AML) program that complies with the BSA, fail to file accurate Currency Transaction Reports (CTRs), and launder money. TDBUSH pleaded guilty to causing TDBNA to fail to maintain an AML program that complies with the BSA and to fail to file accurate CTRs.
TD Bank’s guilty pleas are part of a coordinated resolution with the Board of Governors of the Federal Reserve Board (FRB), as well as the Treasury Department’s Office of the Comptroller of the Currency (OCC) and Financial Crimes Enforcement Network (FinCEN).
“By making its services convenient for criminals, TD Bank became one,” said Attorney General Merrick B. Garland. “Today, TD Bank also became the largest bank in U.S. history to plead guilty to Bank Secrecy Act program failures, and the first US bank in history to plead guilty to conspiracy to commit money laundering. TD Bank chose profits over compliance with the law — a decision that is now costing the bank billions of dollars in penalties. Let me be clear: our investigation continues, and no individual involved in TD Bank’s illegal conduct is off limits.”
“For years, TD Bank starved its compliance program of the resources needed to obey the law. Today’s historic guilty plea, including the largest penalty ever imposed under the Bank Secrecy Act, offers an unmistakable lesson: crime doesn’t pay — and neither does flouting compliance,” said Deputy Attorney General Lisa Monaco. “Every bank compliance official in America should be reviewing today’s charges as a case study of what not to do. And every bank CEO and board member should be doing the same. Because if the business case for compliance wasn’t clear before — it should be now.”
“For nearly a decade, TD Bank failed to update its anti-money laundering compliance program to address known risks. As bank employees acknowledged in internal communications, these failures made the bank an ‘easy target’ for the ‘bad guys.’ These failures also allowed corrupt bank employees to facilitate a criminal network’s laundering of tens of millions of dollars,” said Principal Assistant Attorney General Nicole M. Argentieri, head of the Justice Department's Criminal Division. “U.S. financial institutions are the first line of defense against money laundering and illicit finance. When they participate in crime rather than prevent it, we will not hesitate to hold them accountable to the fullest extent of the law.”
“TD Bank prioritized growth and convenience over following its legal obligations,” said U.S. Attorney Philip R. Sellinger for the District of New Jersey. “As a result of staggering and pervasive failures in oversight, it willfully failed to monitor trillions of dollars of transactions – including those involving ACH transactions, checks, high-risk countries, and peer-to-peer transactions – which allowed hundreds of millions of dollars from money laundering networks to flow through the bank, including for international drug traffickers. The bank was aware of these risks and failed to take steps to protect against them, including for two networks prosecuted in New Jersey and elsewhere – one that dumped piles of cash on the bank’s counters and another that allegedly withdrew amounts from ATMs 40 to 50 times higher than the daily limit for personal accounts.”
According to court documents, between January 2014 and October 2023, TD Bank had long-term, pervasive, and systemic deficiencies in its U.S. AML policies, procedures, and controls but failed to take appropriate remedial action. Instead, senior executives at TD Bank enforced a budget mandate, referred to internally as a “flat cost paradigm,” requiring that TD Bank’s budget not increase year-over-year, despite its profits and risk profile increasing significantly over the same period. Although TD Bank maintained elements of an AML program that appeared adequate on paper, fundamental, widespread flaws in its AML program made TD Bank an “easy target” for perpetrators of financial crime.
Over the last decade, TD Bank’s federal regulators and TD Bank’s own internal audit group repeatedly identified concerns about its transaction monitoring program, a key element of an appropriate AML program necessary to properly detect and report suspicious activities. Nonetheless, from 2014 through 2022, TD Bank’s transaction monitoring program remained effectively static, and did not adapt to address known, glaring deficiencies; emerging money laundering risks; or TD Bank’s new products and services. For years, TD Bank failed to appropriately fund and staff its AML program, opting to postpone and cancel necessary AML projects prioritizing a “flat cost paradigm” and the “customer experience.”
Throughout this time, TD Bank intentionally did not automatically monitor all domestic automated clearinghouse (ACH) transactions, most check activity, and numerous other transaction types, resulting in 92% of total transaction volume going unmonitored from Jan. 1, 2018, to April 12, 2024. This amounted to approximately $18.3 trillion of transaction activity. TD Bank also added no new transaction monitoring scenarios and made no material changes to existing transaction monitoring scenarios from at least 2014 through late 2022; implemented new products and services, like Zelle, without ensuring appropriate transaction monitoring coverage; failed to meaningfully monitor transactions involving high-risk countries; instructed stores to stop filing internal unusual transaction reports on certain suspicious customers; and permitted more than $5 billion in transactional activity to occur in accounts even after the bank decided to close them.
TD Bank’s AML failures made it “convenient” for criminals, in the words of its employees. These failures enabled three money laundering networks to collectively transfer more than $670 million through TD Bank accounts between 2019 and 2023. Between January 2018 and February 2021, one money laundering network processed more than $470 million through the bank through large cash deposits into nominee accounts. The operators of this scheme provided employees gift cards worth more than $57,000 to ensure employees would continue to process their transactions. And even though the operators of this scheme were clearly depositing cash well over $10,000 in suspicious transactions, TD Bank employees did not identify the conductor of the transaction in required reports. In a second scheme between March 2021 and March 2023, a high-risk jewelry business moved nearly $120 million through shell accounts before TD Bank reported the activity. In a third scheme, money laundering networks deposited funds in the United States and quickly withdrew those funds using ATMs in Colombia. Five TD Bank employees conspired with this network and issued dozens of ATM cards for the money launderers, ultimately conspiring in the laundering of approximately $39 million. The Justice Department has charged over two dozen individuals across these schemes, including two bank insiders. TD Bank’s plea agreement requires continued cooperation in ongoing investigations of individuals.
As part of the plea agreement, TD Bank has agreed to forfeit $452,432,302.00 and pay a criminal fine of $1,434,513,478.40, for a total financial penalty of $1,886,945,780.40. TD Bank has also agreed to retain an independent compliance monitor for three years and to remediate and enhance its AML compliance program. TD Bank has separately reached agreements with the FRB, OCC, and FinCEN, and the Justice Department will credit $123.5 million of the forfeiture toward the FRB’s resolution.
The Justice Department reached its resolution with TD Bank based on a number of factors, including the nature, seriousness, and pervasiveness of the offenses, as a result of which TD Bank became the bank of choice for multiple money laundering organizations and criminal actors and processed hundreds of millions of dollars in money laundering transactions. Although TD Bank did not voluntarily disclose its wrongdoing, it received partial credit for its strong cooperation with the Department’s investigation and the ongoing remediation of its AML program. TD Bank did not receive full credit for its cooperation because it failed to timely escalate relevant AML concerns to the Department during the investigation. Accordingly, the total criminal penalty reflects a 20% reduction based on the bank’s partial cooperation and remediation.
IRS Criminal Investigation, the Federal Deposit Insurance Corporation Office of Inspector General, and Drug Enforcement Administration investigated the case. The Morristown Police Department, U.S. Attorney’s Office for the District of Puerto Rico, Homeland Security Investigations, U.S. Customs and Border Protection, and New York City Police Department provided substantial assistance.
Trial Attorneys D. Zachary Adams and Chelsea R. Rooney of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorneys Mark J. Pesce and Angelica Sinopole for the District of New Jersey prosecuted the case.
MLARS’ Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers, and employees, whose actions threaten the integrity of the individual institution or the wider financial system. Since its creation in 2010, the Bank Integrity Unit has prosecuted financial institutions for violations of the BSA, money laundering, sanctions, and other laws, imposing total penalties of over $25 billion.
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 www.justice.gov/OCDETF.
TD Bank US Holding Company Information
TD Bank N.A. Information
TD Bank US Holding Company Plea Agreement and Attachments
TD Bank N.A. Plea Agreement and Attachments
Spokane Man Involved in Robbery of Large Amount of Methamphetamine and Fentanyl Sentenced to Federal PrisonRead the Press Release
Spokane, Washington - Vanessa R. Waldref, United States Attorney for the Eastern District of Washington, announced that Brady Baughman, age 34, of Spokane, Washington, was sentenced after pleading guilty to one count of Robbery Affecting Commerce and one count of Possession with Intent to Distribute 30 Grams or More of Fentanyl. United States District Judge Mary K. Dimke imposed a sentence of 120 months imprisonment to be followed by 5 years of supervised release.
According to court documents and information presented at the sentencing hearing, on February 6, 2022, Baughman went to a stash house in Spokane to buy a large quantity of methamphetamine and fentanyl from a drug trafficking organization operating in Spokane. Baughman presented $12,000.00 of counterfeit U.S. currency to members of the drug trafficking organization. Immediately recognizing that the buy money was counterfeit, the sellers declined the sale. Baughman then robbed drug couriers who were entering the stash house carrying controlled substances inside a kitty litter bucket and a backpack. Baughman then sped off in his vehicle with the stolen drugs.
Members of the drug trafficking organization attempted to find Baughman. They ultimately tracked Baughman near the intersection of Nettleton and Rowan in Spokane and fired several shots at his vehicle during high-speed pursuit. Baughman fled from the vehicle with the kitty litter bucket and backpack.
Immediately thereafter, Spokane Police Department (SPD) located the kitty litter bucket and backpack, abandoned, lying in the parking lot of a business nearby. The kitty litter bucket contained approximately 16 pounds of Methamphetamine. The backpack contained 50,441 fentanyl laced pills.
After an arrest warrant was issued for his involvement with the robbery, on August 12, 2022, SPD located Baughman after an SPD officer observed Baughman driving a motorcycle more than 55 mph in a 30-mph zone. The SPD officer activated his lights and attempted a traffic stop. Baughman refused to pull over, ran several stop signs and traffic lights, and sped off into a residential neighborhood. The SPD officer was required to abandon his pursuit. A few minutes later, Baughman crashed his motorcycle and sustained a serious head injury. Inside a backpack Baughman was carrying, SPD officers found a loaded 9mm pistol and 1,178 fentanyl pills.
When Baughman, who was in the hospital being treated for injuries from the motorcycle crash, became aware he had been indicted and was wanted by law enforcement, he fled the medical center.
After remaining a fugitive for almost a year, on March 28, 2023, Baughman was located and arrested on his outstanding warrants. During a search incident to arrest, officers located a blue bottle with 100 fentanyl laced pills. During a search of the car, SPD found an additional 1,500 fentanyl laced pills.
“The scope of Mr. Baughman’s criminal conduct is shocking. From the robbery of a large amount of deadly drugs, to a high-speed getaway with shots fired, and including a reckless attempt to avoid law enforcement that ended with serious injury, Mr. Baughman’s actions repeatedly put our community in danger,” stated U.S. Attorney Waldref. “I’m grateful for our close partnerships with local and federal law enforcement who work to hold people like Mr. Baughman accountable for their actions and make Eastern Washington safer and stronger.”
“This case is a snapshot of the threats to the community posed by drug traffickers like Mr. Baughman,” said David F. Reames, Special Agent in Charge, DEA Seattle Field Division. “He engaged in reckless and violent behavior, all while trying to poison our community with fentanyl and methamphetamine for his personal gain. I am proud of the efforts of the Drug Enforcement Administration and our partners in safely bringing this case to a conclusion.”
This case was investigated by the Drug Enforcement Administration and the Spokane Police Department. It was prosecuted by Assistant United States Attorney Stephanie Van Marter.
2:22-cr-00072-MKD
South Bend Man Sentenced to 110 Months in PrisonRead the Press Release
SOUTH BEND – Tony Young, 54 years old, of South Bend, Indiana, was sentenced by United States District Court Judge Damon R. Leichty after pleading guilty to being a convicted felon in possession of a firearm, announced United States Attorney Clifford D. Johnson.
Young was sentenced to 110 months in prison followed by 3 years of supervised release.
According to documents in the case, in March and April 2024, law enforcement was investigating drug activity at a Mishawaka residence, which included the sale of methamphetamine by Young. A search warrant of the residence resulted in the recovery of a loaded stolen revolver. Young, who has a number of prior felony convictions, was prohibited from possessing the firearm in this case.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Drug Enforcement Administration with assistance from the Mishawaka Police Department and the Indiana State Police. The case was prosecuted by Assistant United States Attorney Joel Gabrielse.
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.
Somerset County Man Admits Federal Hate Crime in Connection with Breaking into Center for Islamic Life at Rutgers University and Destroying PropertyRead the Press Release
Video Statement:
https://youtu.be/eBEn8v-pD10
NEWARK, N.J. – A Somerset County, New Jersey, man admitted committing a federal hate crime for breaking into the Center for Islamic Life (CILRU) at Rutgers University in New Brunswick and destroying property, U.S. Attorney Philip R. Sellinger for the District of New Jersey, Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, and New Jersey State Attorney General Matthew J. Platkin announced today.
Jacob Beacher, 24, of North Plainfield, New Jersey, pleaded guilty before U.S. District Judge Robert Kirsch in Trenton federal court on Oct. 9, 2024, to an information charging him with damage to religious property.
“The free exercise of religion is a fundamental right of all Americans. Jacob Beacher admitted he intentionally broke into the Center for Islamic Life during the holy Eid-al-Fitr holiday and damaged and destroyed religious artifacts because of the Islamic faith of those associated with the facility. This office will not tolerate the use of force or threats to intimidate people and put them in fear of worshipping as they see fit.”
U.S. Attorney Philip R. Sellinger
“This defendant is being held accountable for Islamophobic-fueled acts of hate, interfering with the religious freedom of university students and staff during a sacred holiday for those of the Islamic faith,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department stands ready, along with our state and local partners, to hold accountable people who use force, or threats of violence, in order to intimidate people from exercising their religious beliefs. Islamophobic hate crimes have no place in our society today. We will continue to enforce the laws that make it safe for people of all faiths to engage in religious observance, including at educational institutions.”
“When we learned of this vandalism back in April, we immediately engaged with our law enforcement partners and Rutgers University,” FBI Newark Acting Special Agent in Charge Nelson I. Delgado said. “Within days, we tracked down and arrested Beacher. We want our actions and the speed with which we responded to illustrate our commitment and resolve to protect houses of worship in New Jersey. We all have the right to practice whatever religion we choose, without fear of hate marring the physical and spiritual place where we do it.”
According to documents filed in this case and statements made in court:
On April 10, 2024, during the Eid-al-Fitr holiday, Beacher broke into the CILRU around 2:41 a.m., where he damaged the CILRU’s property, including several religious artifacts, such as Turbah prayer stones, which are clay stones on which Muslims prostrate during prayer, and numerous other items that contained holy language from the Qur’an, Islam’s sacred scripture. Beacher also stole a Palestinian flag and a charity box belonging to the CILRU. He caused damage and destruction of property in excess of $5,000.
The charge of damage to religious property carries a maximum potential penalty of three years in prison and a fine of up to $250,000 fine, or twice the gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Feb. 11, 2025.
U.S. Attorney Sellinger credited special agents of the FBI, Branchburg Resident Agency, under the direction of Acting Special Agent in Charge Nelson I. Delgado in Newark; prosecutors and detectives from the New Jersey Attorney General’s Office, under the direction of Attorney General Matthew J. Platkin; detectives from the Middlesex County Prosecutor’s Office, under the direction of Prosecutor Yolanda Ciccone; the Rutgers University Police Department-New Brunswick Division, under the leadership of Chief of University Police Kenneth Cop; and the New Jersey Regional Computer Forensics Laboratory.
The government is represented by Assistant U.S. Attorney Benjamin Levin, Chief of the General Crimes Unit, and R. Joseph Gribko, Deputy Chief of the Civil Rights Division, with assistance from the National Security Unit for the District of New Jersey, as well by Trial Attorney Daniel Grunert of the Justice Department’s Civil Rights Division.
beacher.information.pdfSimpson County Sheriff’s Deputy Indicted for Using Excessive Force Against a Handcuffed ArresteeRead the Press Release
Jackson, Miss. – A Simpson County Sheriff’s Deputy appeared for an arraignment today following an Indictment filed in Jackson on criminal charges related to his use of excessive force against an arrestee.
According to court documents, Adrian Durr, 43, of Magee, used excessive force against an arrestee in the custody of the Simpson County Sheriff’s Office. The Indictment alleges that while the arrestee was handcuffed to a bench that was bolted to the floor and shackled with leg irons on his ankles, Durr struck the arrestee in the head with the handgrip of his taser. After striking the arrestee with his taser, Durr kicked the arrestee in the head rendering him unconscious. At all times, the arrestee was handcuffed and hobbled with leg irons on his ankles.
“Law enforcement officers in Mississippi and throughout the nation are required to take care of the safety and welfare of the people they arrest,” said U.S. Attorney Todd Gee. “Unlawful physical assaults on arrestees are federal crimes that the Justice Department will prosecute.”
“Our citizens deserve credible law enforcement to safeguard the community from crime,” said FBI Special Agent in Charge Robert A. Eikhoff. “The actions of Mr. Durr significantly deprived the citizens of that protection and eroded the trust earned each day by honest law enforcement officers throughout the nation. The FBI is committed to aggressively investigating those who misuse their authority and violate individual’s rights in the execution of their sworn duties.”
Durr is charged by Indictment with Deprivation of Civil Rights Under Color of Law. If convicted, he faces a maximum penalty of 10 years in prison.
U.S. Attorney Todd W. Gee and Special Agent in Charge Robert A. Eikhoff of the Federal Bureau of Investigation made the announcement.
The Federal Bureau of Investigation is investigating the case.
Assistant U.S. Attorney Samuel Goff is prosecuting the case.
Seventeen Individuals Indicted Alleging A Sophisticated Nationwide Money Laundering Scheme Originating with Violent Crime in Baltimore CityRead the Press Release
Baltimore, Maryland – 17 individuals were indicted yesterday in a Drug Enforcement Administration and Department of Homeland Security investigation involving a sophisticated money laundering scheme and illegal marijuana distribution network resulting in the seizure of over $6,000,000 and over 2,000 pounds of marijuana in illegal proceeds to date.
The investigation – which was undertaken by the Drug Enforcement Administration-Washington Division and Department of Homeland Security-Baltimore Field Office (“HSI”), with support from DEA offices in New Jersey, New York, Washington, and Oregon - began in March 2023 with two separate non-fatal shootings of one individual in Baltimore, Maryland, that has subsequently revealed a sprawling network of individuals laundering millions of dollars generated from the illegal distribution of massive quantities of marijuana. That network includes large-scale launderers operating a Chinese Money Laundering Organization (MLO) in New York city, and drug traffickers operating in Maryland, sending large quantities of bulk cash proceeds from Maryland to other states, including New York, New Jersey, and Oregon to obtain further shipments of marijuana and to conceal the source of the proceeds.
The Indictment charges the following individuals in count one with Conspiracy to Engage in Money Laundering, and in count two with Conspiracy to Distribute Controlled Substances: Qihai Tao; Michael Micklos; Can Xu; Praveen Morgan; Michael Tilmon, III; Emanuel Dukes; Steven Mack; William Brown, III; Malik Bridgers; David Hilliard; Derian Green; Huayi Zhong; Zebin Liu; Chunbing Qin; Peng Huang; Isaac Huynh, and Li Chen. The maximum penalty for Conspiracy to Engage in Money Laundering is twenty years imprisonment and up to a $500,000 fine. The maximum penalty for Conspiracy to Distribute Controlled Substances, as charged in the indictment, is up to twenty years imprisonment and up to $1,000,000, per defendant. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Additionally, Michael Tilmon III, and Steven Mack are charged in one count each with Possession of a Firearm by a Prohibited Person. The maximum penalty for this offense is up to fifteen years imprisonment, and up to a $250,000 fine.
“When violence erupts in our communities, we will track it down to its core. This investigation demonstrates how organized international money laundering drives gun violence and illegal drug trafficking,” said Erek L. Barron, U.S. Attorney for the District of Maryland. “Through the coordinated efforts of our OCDETF Strike Force and law enforcement partners, our highest priority is protecting the nation’s safety and security.”
“This investigation is a clear example of how we use DEA’s collective resources to identify money laundering schemes and drug distribution networks in order to disrupt and dismantle their operations,” emphasized Jarod Forget, Special Agent in Charge of DEA Washington Division. “The increasingly dynamic and complex nature of the illicit drug trade demands enhanced cooperation with local, state and federal partners that reflects the reality of a globalized supply chain for illegal drugs and its transnational money laundering activities. We will pursue all enablers of these illicit activities by denying the criminal networks of their ill-gotten proceeds and interrupt their ability to transfer working capital to fund their range of illicit activities.”
“This investigation stands as a compelling example of the remarkable outcomes achieved when law enforcement agencies collaborate toward a common objective,” said Special Agent in Charge Michael McCarthy of HSI Baltimore. “What began as an inquiry into two seemingly unrelated shootings in Baltimore evolved into a comprehensive investigation that exposed a vast criminal enterprise engaged in drug trafficking and the laundering of millions of dollars. This nefarious network extended its reach from Maryland to New York and beyond, infiltrating multiple communities. HSI remains resolute in its commitment to safeguarding Maryland’s neighborhoods by working in close coordination with our law enforcement partners to dismantle and disrupt such criminal organizations.”
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty at some later criminal proceedings.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations. The specific mission of the Baltimore Strike Force is to identify, disrupt, and dismantle violent drug trafficking, money laundering, and transnational criminal organizations to reduce drug-related and/or gang violence in the Baltimore metropolitan and surrounding areas. The Baltimore Strike Force is comprised of agents and officers from the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Drug Enforcement Administration, the Federal Bureau of Investigation, the Department of Homeland Security, the United States Marshals Service, the United States Secret Service, United States Postal Inspection Service, the Maryland State Police, the Baltimore Police Department, the Baltimore Sheriff’s Office, the Baltimore County Police Department, the Maryland Transportation Authority, and the Maryland Department of Public Safety and Correctional Services. The prosecution is being led by the Office of the United States Attorney for the District of Maryland.
U.S. Attorney Barron commended the DEA-Baltimore Field Office, the HSI-Baltimore Field Office, Baltimore County Police Department, Maryland Department of Public Safety and Correctional Services, and Maryland State Police. Mr. Barron thanked the U.S. Attorney’s Office for the Eastern District of New York, the Southern District of New York, the District of New Jersey, the Western District of Washington, the District of Oregon, and the Eastern District of Texas for their vital cooperation in this investigation. Mr. Barron also thanked Assistant U.S. Attorneys Alex Kalim, Alex Levin, and James Wallner, who are prosecuting the federal case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Seventeen Individuals Indicted Alleging A Sophisticated Nationwide Money Laundering Scheme Originating with Violent Crime in Baltimore CityRead the Press Release
Baltimore, Maryland – 17 individuals were indicted yesterday in a Drug Enforcement Administration and Department of Homeland Security investigation involving a sophisticated money laundering scheme and illegal marijuana distribution network resulting in the seizure of over $6,000,000 and over 2000 pounds of marijuana in illegal proceeds to date.
The investigation – which was undertaken by the Drug Enforcement Administration-Baltimore Field Office and Department of Homeland Security-Baltimore Field Office (“HSI”), with support from DEA offices in New Jersey, New York, Washington, and Oregon - began in March 2023 with two separate non-fatal shootings of one individual in Baltimore, Maryland, that has subsequently revealed a sprawling network of individuals laundering millions of dollars generated from the illegal distribution of massive quantities of marijuana. That network includes large-scale launderers operating a Chinese Money Laundering Organization (MLO) in New York city, and drug traffickers operating in Maryland, sending large quantities of bulk cash proceeds from Maryland to other states, including New York, New Jersey, and Oregon to obtain further shipments of marijuana and to conceal the source of the proceeds.
The Indictment charges the following individuals in count one with Conspiracy to Engage in Money Laundering, and in count two with Conspiracy to Distribute Controlled Substances: Qihai Tao; Michael Micklos; Can Xu; Praveen Morgan; Michael Tilmon, III; Emanuel Dukes; Steven Mack; William Brown, III; Malik Bridgers; David Hilliard; Derian Green; Huayi Zhong; Zebin Liu; Chunbing Qin; Peng Huang; Isaac Huynh, and Li Chen. The maximum penalty for Conspiracy to Engage in Money Laundering is twenty years imprisonment and up to a $500,000 fine. The maximum penalty for Conspiracy to Distribute Controlled Substances, as charged in the indictment, is up to twenty years imprisonment and up to $1,000,000, per defendant. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Additionally, Michael Tilmon III, and Steven Mack are charged in one count each with Possession of a Firearm by a Prohibited Person. The maximum penalty for this offense is up to fifteen years imprisonment, and up to a $250,000 fine.
“When violence erupts in our communities, we will track it down to its core. This investigation demonstrates how organized international money laundering drives gun violence and illegal drug trafficking,” said Erek L. Barron, U.S. Attorney for the District of Maryland. “Through the coordinated efforts of our OCDETF Strike Force and law enforcement partners, our highest priority is protecting the nation’s safety and security.”
“This investigation is a clear example of how we use DEA’s collective resources to identify money laundering schemes and drug distribution networks in order to disrupt and dismantle their operations,” emphasized Jarod Forget, Special Agent in Charge of DEA Washington Division. “The increasingly dynamic and complex nature of the illicit drug trade demands enhanced cooperation with local, state and federal partners that reflects the reality of a globalized supply chain for illegal drugs and its transnational money laundering activities. We will pursue all enablers of these illicit activities by denying the criminal networks of their ill-gotten proceeds and interrupt their ability to transfer working capital to fund their range of illicit activities.”
“This investigation stands as a compelling example of the remarkable outcomes achieved when law enforcement agencies collaborate toward a common objective,” said Special Agent in Charge Michael McCarthy of HSI Baltimore. “What began as an inquiry into two seemingly unrelated shootings in Baltimore evolved into a comprehensive investigation that exposed a vast criminal enterprise engaged in drug trafficking and the laundering of millions of dollars. This nefarious network extended its reach from Maryland to New York and beyond, infiltrating multiple communities. HSI remains resolute in its commitment to safeguarding Maryland’s neighborhoods by working in close coordination with our law enforcement partners to dismantle and disrupt such criminal organizations.”
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty at some later criminal proceedings.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) Strike Force Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations to disrupt and dismantle the most significant drug traffickers, money launderers, gangs, and transnational criminal organizations. The specific mission of the Baltimore Strike Force is to identify, disrupt, and dismantle violent drug trafficking, money laundering, and transnational criminal organizations to reduce drug-related and/or gang violence in the Baltimore metropolitan and surrounding areas. The Baltimore Strike Force is comprised of agents and officers from the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Drug Enforcement Administration, the Federal Bureau of Investigation, the Department of Homeland Security, the United States Marshals Service, the United States Secret Service, United States Postal Inspection Service, the Maryland State Police, the Baltimore Police Department, the Baltimore Sheriff’s Office, the Baltimore County Police Department, the Maryland Transportation Authority, and the Maryland Department of Public Safety and Correctional Services. The prosecution is being led by the Office of the United States Attorney for the District of Maryland.
U.S. Attorney Barron commended the DEA-Baltimore Field Office, the HSI-Baltimore Field Office, Baltimore County Police Department, Maryland Department of Public Safety and Correctional Services, and Maryland State Police. Mr. Barron thanked the U.S. Attorney’s Office for the Eastern District of New York, the Southern District of New York, the District of New Jersey, the Western District of Washington, the District of Oregon, and the Eastern District of Texas for their vital cooperation in this investigation. Mr. Barron also thanked Assistant U.S. Attorneys Alex Kalim, Alex Levin, and James Wallner, who are prosecuting the federal case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Readout of Principal Deputy Associate Attorney General Benjamin C. Mizer’s Participation in OECD Global Roundtable on Equal Access to JusticeRead the Press Release
Principal Deputy Associate Attorney General (PDASG) Benjamin C. Mizer traveled to Ottawa, Canada, on Oct. 8-9, to represent the United States at the Organization for Economic Cooperation and Development (OCED) Global Roundtable on Equal Access to Justice. The roundtables are a forum for the exchange of practices and lessons learned and provide an opportunity for policymakers to share experiences on improving access to justice for all, including from the perspective of people and businesses. PDASG Mizer provided remarks on behalf of the United States at the OECD Roundtable’s High-Level Dialogue.
On the sidelines of the dialogue, PDASG Mizer met with a range of stakeholders, including representatives from ministries of justice and civil society organizations from around the world. During the roundtable, the Office for Access to Justice moderated a workshop with Department of Justice Canada on people-centered approaches to administrative justice and participated in panel discussion on inclusive justice strategies.
High-Level Dialogue at the Organization for Economic Cooperation and Development (OCED) Global Roundtable on Equal Access to Justice.Providence Man Sentenced for Trafficking MethamphetamineRead the Press Release
PROVIDENCE, RI – A Providence man who participated in a conspiracy to possess and distribute large quantities of methamphetamine has been sentenced to six years in federal prison, announced United States Attorney Zachary A. Cunha.
Charles Bersch, 40, was sentenced today by U.S. District Court Judge Mary S. McElroy to 72 months of incarceration to be followed by three years of supervised release. Bersch pleaded guilty on February 5, 2024, to a charge of conspiracy to distribute and conspiracy to possess with intent to distribute five grams or more of methamphetamine, as well as a charge of possession with intent to distribute five grams or more of methamphetamine.
According to information presented to the court, in May 2022, a member of the FBI Safe Streets Task Force was conducting surveillance outside a Cranston residence as part of an ongoing FBI investigation. While outside the residence, the task force officer saw Bersch and another person, Peter Walkovich, 30, of Pepperrell, MA, arrive by car and enter the building. The task force officer had developed information that Walkovich was in possession of a significant quantity of methamphetamine.
After several minutes, Bersch and Walkovich left the residence with two other individuals and the four men drove off in the car that Bersch and Walkovich arrived in. An officer stopped the car a short distance from the residence. After making observations of suspicious behavior by Walkovich, the officer searched the care and found three backpacks , including one carried from the Cranston residence by Walkovich. Each backpack contained large quantities of methamphetamine. One of the backpacks contained $7,000 in cash. Four thousand dollars was also found inside the vehicle’s spare tire compartment. Lab tests later determined that all of the meth seized was between 97% and 100% pure.
Walkovich pleaded guilty on July 20, 2023, to conspiracy to distribute and to possess with intent to distribute methamphetamine and possession with intent to distribute methamphetamine. He was sentenced on September 6, 2023, to 48 months of incarceration to be followed by three years of supervised release.
The cases were prosecuted by Assistant U.S. Attorney Paul F. Daly, Jr.
The matter was investigated by the FBI Safe Streets Task Force, consisting of agents and law enforcement officers from the FBI, Rhode Island State Police, the Cranston, Woonsocket, Pawtucket, West Warwick, and Central Falls Police Departments, and the U.S. Marshals Service.
U.S. Attorney Cunha thanks the DEA for providing lab testing that determined the weight and the purity of the drugs seized.
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Protestor Federally Charged with Assault on Officers During the July 24 Demonstration in Washington D.C.Read the Press Release
WASHINGTON – Zachary Kam, 24, of Chicago, IL, was arrested this morning in connection with a federal criminal complaint charging him with assault on two law enforcement officers during a demonstration at Columbus Circle in front of Union Station in Washington, D.C., on July 24, 2024.
The charges were announced by U.S. Attorney Matthew M. Graves, Special Agent in Charge Sanjay Virmani of the FBI Washington Field Office Counterterrorism Division, and Chief Jessica M. E. Taylor of the National Park Service’s United States Park Police (USPP).
Kam will make his initial appearance this afternoon in the U.S. District Court for the Northern District of Illinois. He is charged with two counts of assaulting, resisting, opposing, intimidating, interfering, or impeding certain officers or employees.
“Assaulting a federal officer during the course of a protest is not constitutionally protected speech, it is a federal crime,” said U.S. Attorney Graves. “Tens of thousands of people peacefully protest in our Capital every year. It is a federal crime to punch, push, grab, or shove a federal officer. The relatively few who engage in such conduct during a protest should expect to be federally charged.”
According to court documents, on July 24, 2024, an organization was granted a permit to demonstrate in the area of Columbus Circle, located at Massachusetts Ave. NE, and E St. NE, directly in front of Union Station. From about 3 p.m. until 5 p.m., demonstrators who had gathered in Columbus Circle pulled down flags affixed to the flagpoles; burned flags and objects; sprayed graffiti on multiple statutes and structures; and interfered with law enforcement’s ability to place individuals under arrest.
On July 24, 2024, at approximately 3 p.m., USPP officers were attempting to arrest an individual for pulling down a flag from a flagpole in Columbus Circle. The individual fled and USPP officers caught up with him in the crowd.
As USPP officers were effecting that arrest, Kam approached USPP Officer L.I. from behind, grabbed the top of the officer’s vest, pulled the officer to the ground, and dragged the officer several feet. The assault was captured in multiple videos and photos, later shared on Twitter and other platforms, as well as USPP body-worn camera. Kam then dashed into the crowd, but other police were unable to catch him.
Less than a minute later, Kam returned, grabbed another officer by his vest and pulled that officer to the ground. The second assault was also captured on multiple open-source videos that were later posted to various internet platforms. After the second assault, the attacker again disappeared into the crowd.
At the time of the assaults, Kam was wearing a red and blue hat, gray t-shirt, a tan camouflage vest, blue jeans, and black shoes. USPP Officers who were stationed in an observation post near Columbus Circle broadcasted Kam’s description over police radio. At 7:13 p.m., USPP Officers near John Marshall Park, which is located on the 400 Block of C Street Northwest, spotted an individual that matched the individual’s description, who was later identified as Zachary Kam.
After being stopped by USPP, Kam was placed under arrest and charged in the Superior Court for the District of Columbia with assaulting a police officer.
This case is being investigated by the USPP’s Intelligence and Counterterrorism Unit and the FBI Washington Field Office, with assistance from the FBI Chicago Field Office. It is being prosecuted by Assistant U.S. Attorney Sarah Martin.
A criminal complaint is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Owner of Sumner Wholesale Auto Group and a Co-Conspirator Charged in Scheme to Defraud Ford Motor CompanyRead the Press Release
NASHVILLE – John Alan Nebel, 39, of Gallatin, Tennessee, and Joshua David Nichols, 52, of Nashville, Tennessee, have been charged with conspiring to defraud Ford Motor Company by selling old fuel injectors in boxes falsely labeled with Ford markings to make it appear as though those parts were eligible for a rebate from Ford, announced Acting United States Attorney Thomas J. Jaworski for the Middle District of Tennessee.
According to court documents, Nebel was a founder and co-owner of Sumner Wholesale Auto Group LLC, which operated under the name SWAG Performance & Off-Road LLC in Hendersonville, Tennessee, during the time of the conspiracy. SWAG has relocated to Cotton Town, Tennessee. Nichols was an independent contractor working for SWAG.
Ford offered a rebate program through which customers who bought a genuine Ford replacement fuel injector, which cost approximately $300, could return their old fuel injector (“core”) and receive $180 from Ford. Instead of selling genuine Ford cores to SWAG’s customers, Nebel, Nichols and their co-conspirators bought old, used cores for $35 to $45, packaged them using fake labels, decals and logos so that they appeared to be cores that were associated with the purchase of new replacement parts, and then sold them to SWAG customers for $95 to $170 each, knowing that SWAG’s customers would make rebate claims to Ford for the full $180 rebate.
If convicted, Nebel and Nichols face up to 20 years in federal prison and a maximum fine of $250,000 each.
This case is being investigated by Homeland Security Investigations. Assistant U.S. Attorney Stephanie N. Toussaint is prosecuting the case.
An indictment or information is merely an allegation. The defendants are presumed innocent until convicted.
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Ohio Man Sentenced for Creating and Distributing Videos Depicting Monkey Torture and MutilationRead the Press Release
An Ohio man was sentenced today to 54 months in prison and three years of supervised release in connection with his involvement with online groups dedicated to creating and distributing videos depicting acts of extreme violence and sexual abuse against monkeys.
According to court documents, Ronald P. Bedra, of Etna, conspired with others to create and distribute videos depicting acts of sadistic violence against baby and adult monkeys. The conspirators used encrypted chat applications to direct money to individuals in Indonesia willing to commit the requested acts of torture on camera. Bedra also mailed a thumb drive containing 64 videos of monkey torture to a co-conspirator in Wisconsin.
According to a statement of facts signed by defendant Bedra, the videos in question included depictions of monkeys having their digits and limbs severed and monkeys being forcibly sodomized with a heated screwdriver. Bedra pleaded guilty in April.
“Defendant Ronald Bedra commissioned grotesque videos of torture of juvenile and baby monkeys,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “Such appalling conduct has no place in our society. The Justice Department stands ready to prosecute individuals engaging in this activity to the fullest extent of the law.”
“We will punish participants of sadistic conspiracies like this one no matter their role in the crime,” said U.S. Attorney Kenneth L. Parker for the Southern District of Ohio. “As this case shows, even if you do not commit the torture firsthand, you will be held accountable for promoting this obscene animal abuse.”
“The torture of animals in this case is disturbing, cruel and illegal,” said Special Agent in Charge Elena Iatarola of FBI’s Cincinnati Field Office. “The FBI and our partners will continue to work to protect defenseless animals and investigate those who intentionally harm them.”
“Today’s sentencing underscores the U.S. Fish and Wildlife Service’s unwavering commitment to combating the exploitation of wildlife in any form,” said Assistant Director Edward Grace of the U.S. Fish and Wildlife Service’s Office of Law Enforcement. “These monstrous crimes are indefensible. This case serves as a stark reminder that those who harm animals protected under federal and international laws and treaties will face serious consequences. We continue to work diligently with our partners to identify and prosecute individuals engaged in these cruel activities to the fullest extent of the law.”
The FBI and U.S. Fish and Wildlife Service investigated the case. Homeland Security Investigations provided critical assistance.
Trial Attorney Mark Romley and Senior Trial Attorney Adam Cullman of the Environment and Natural Resources Division’s Environmental Crimes Section and Assistant U.S. Attorney Nicole Pakiz for the Southern District of Ohio are prosecuting the case.
New York Man Charged with Attempted Sexual Exploitation of A Minor and Enticement of A Minor to Engage in Illegal Sexual ActivityRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Darnell Henry, age 42, of Bronx, New York, was indicted by a federal grand jury for attempted sexual exploitation of a minor and enticement of a minor to engage in illegal sexual activity.
According to U.S. Attorney Gerard M. Karam, the indictment charges Henry with attempted sexual exploitation of child who had not obtained the age of 18-years-old, between May 9, 2024 and May 25, 2024, in Adams County. The indictment further charges Henry with enticement of a minor to engage in illegal sexual activity between May 9, 2024 and June 2, 2024.
The case was investigated by the Pennsylvania State Police, the New York City Police Department, and the Federal Bureau of Investigation. Assistant United States Attorney K. Wesley Mishoe is prosecuting the case.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc.
The maximum penalty upon conviction for the charged offense is life imprisonment, a lifetime term of supervised release following imprisonment, a fine, a statutory assessment, and a special assessment. A sentence following a finding of guilt is imposed by a court 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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New Jersey Man Pleads Guilty to Federal Hate Crime for Breaking into Center for Islamic Life at Rutgers University and Destroying PropertyRead the Press Release
A New Jersey man pleaded guilty yesterday to a federal hate crime for breaking into the Center for Islamic Life at Rutgers University (CILRU) in New Brunswick, New Jersey, and destroying property.
“This defendant is being held accountable for Islamophobic-fueled acts of hate, interfering with the religious freedom of university students and staff during a sacred holiday for those of the Islamic faith,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department stands ready, along with our state and local partners, to hold accountable people who use force, or threats of violence, in order to intimidate people from exercising their religious beliefs. Islamophobic hate crimes have no place in our society today. We will continue to enforce the laws that make it safe for people of all faiths to engage in religious observance, including at educational institutions.”
“The free exercise of religion is a fundamental right of all Americans,” said U.S. Attorney Philip R. Sellinger for the District of New Jersey. “Jacob Beacher admitted he intentionally broke into the Center for Islamic Life during the holy Eid-al-Fitr holiday and damaged and destroyed religious artifacts because of the Islamic faith of those associated with the facility. This office will not tolerate the use of force or threats to intimidate people and put them in fear of worshipping as they see fit.”
“When we learned of this vandalism back in April, we immediately engaged with our law enforcement partners and Rutgers University,” said Acting Special Agent in Charge Nelson I. Delgado of the FBI Newark Field Office. “Within days, we tracked down and arrested Beacher. We want our actions and the speed with which we responded to illustrate our commitment and resolve to protect houses of worship in New Jersey. We all have the right to practice whatever religion we choose, without fear of hate marring the physical and spiritual place where we do it.”
According to court documents, on or about April 10, at approximately 2:39 a.m., during the Eid- al-Fitr holiday, video surveillance footage showed Jacob Beacher, 24, walking toward the rear door of the CILRU. Soon after, at approximately 2:41 a.m., an intruder, later determined to be Beacher, forcibly entered the CILRU through its back door. Specifically, Beacher broke a glass pane on the door, pushed through a piece of plexiglass that was affixed to the interior side of the door and then manually opened the door from the inside by reaching through the broken glass to unlatch a deadbolt lock.
Once inside the CILRU, Beacher damaged the CILRU’s property, including several religious artifacts, such as Turbah prayer stones and numerous items that contained holy language from the Qur’an, Islam’s sacred scripture. Beacher also stole a Palestinian flag and at least one charity box belonging to the CILRU.
A sentencing hearing will be scheduled for a later date. Beacher faces a maximum penalty of three years in prison. A federal district court judge will determine any sentence based on the U.S. Sentencing Guidelines and other statutory factors.
The FBI Newark Field Office, Branchburg Resident Agency, New Jersey Attorney General’s Office, Middlesex County Prosecutor’s Office, Rutgers University Police Department-New Brunswick Division and New Jersey Regional Computer Forensics Laboratory investigated the case.
Assistant U.S. Attorneys Benjamin Levin and R. Joseph Gribko for the District of New Jersey and Trial Attorney Daniel Grunert of the Justice Department’s Civil Rights Division are prosecuting the case.
New Jersey Construction Company Owner Pleads Guilty to Tax EvasionRead the Press Release
A New Jersey man pleaded guilty today to tax evasion for evading employment tax penalties assessed against him.
According to court documents and statements made in court, Joseph Caravella, of Randolph, owned several masonry companies in New Jersey. From 2008 to 2016, the IRS assessed approximately $650,000 in Trust Fund Recovery penalties against Caravella for causing three masonry businesses that he owned to not pay their federal employment taxes. From around March 2008 through in or around April 2019, Caravella sought to evade the payment of these penalties by placing companies that he controlled in the names of nominee owners and avoiding using a bank account in his own name to prevent the IRS from levying the funds. Also during that time, Caravella continued to cause his businesses not to pay employment taxes, resulting in an additional loss of $1.2 million to the IRS.
In total, Carvalla caused a tax loss to the IRS of $1,885,519.39.
Caravella is scheduled to be sentenced on March 18. He faces a maximum penalty of five years in prison, a period of supervised release, restitution and monetary penalties. A federal judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Philip R. Sellinger for the District of New Jersey made the announcement.
IRS Criminal Investigation are investigating the case.
Trial Attorneys Kenneth Vert and Evan Mulbry of the Tax Division and Assistant U.S. Attorney Shontae Gray for the District of New Jersey are prosecuting the case.
McAlester Resident Sentenced for Sexual Exploitation of A ChildRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Amanda Lynn Howerton, age 41, of McAlester, Oklahoma, was sentenced to 210 months in prison for one count of Sexual Exploitation of a Child.
The charges arose from an investigation by the Federal Bureau of Investigation and the Choctaw Nation Lighthorse Police.
On February 5, 2024, Howerton pleaded guilty to the charge. According to investigators, on January 22, 2023, Howerton produced a visual depiction of the sexual abuse of a child, then sold that image on the internet.
“The defendant exploited the innocence of a child by taking sexually suggestive photographs for personal financial gain. This is not only an abhorrent violation of the law, but morally reprehensible and will not be tolerated by the FBI,” said FBI Oklahoma City Special Agent in Charge Doug Goodwater. “This sentencing delivers a clear message that the FBI will work tirelessly with our partners to ensure those who harm children will face consequences.”
“The defendant’s acts—producing and selling depictions of child sexual abuse for personal gain—were despicable and heartless,” said United States Attorney Christopher J. Wilson. “Although the sentence handed down will not erase the trauma of such betrayal, it is most certainly deserved.”
The Honorable Ronald A. White, U.S. Chief District Judge in the United States District Court for the Eastern District of Oklahoma, presided over the hearing. Howerton will remain in the custody of the U.S. Marshal pending transportation to a designated United States Bureau of Prisons facility to serve a non-paroleable sentence of incarceration.
Assistant U.S. Attorney Morgan Muzljakovich represented the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
We encourage anyone who suspects or has information regarding child sexual exploitation, trafficking of minors, sextortion, child pornography, or any other means of child exploitation to immediately contact law enforcement. You can file a report on the National Center for Missing & Exploited Children (NCMEC)'s website at www.cybertipline.com, call 1-800-843-5678, contact the FBI at 1-800-CALL-FBI (1-800-225-5324), or call 877-4-HSI TIP.
Maryland Man Indicted for $35 Million Bank Fraud SchemeRead the Press Release
MINNEAPOLIS – A Maryland man has been indicted for his role in a $35 million bank fraud conspiracy, announced U.S. Attorney Andrew M. Luger.
According to court documents, from September 2020 through October 2021, Karl Reid Selle, 38, of Bowie, Maryland, conspired with Matthew Thomas Onofrio to devise and execute a scheme to defraud federally-insured banks and credit unions in Minnesota, Wisconsin, and elsewhere. As part of the scheme, Onofrio, who operated a business entity called Northwoods Management LLC, marketed a program for investors to acquire commercial real estate located in various states. Onofrio, or his business entity, would cause false information to be submitted to lenders financing investors’ real estate purchases and in some cases altered purchase agreements to support higher appraisals of the properties. The indictment also alleges that part of the scheme was to withhold information from the lenders, including the fact that Onofrio made loans to investors to help them purchase the properties and that the loans constituted liabilities that should be disclosed in a loan application.
The indictment charges Selle with one count of conspiracy to commit bank fraud. He made his initial appearance in U.S. District Court on October 8, 2024, before Magistrate Judge Douglas L. Micko.
This case is the result of an investigation conducted by the FBI.
Assistant U.S. Attorney Robert M. Lewis is prosecuting the case.
An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Marion Woman Charged with Wire FraudRead the Press Release
Megan Middaugh, age 38, from Marion, Iowa, has been charged with five counts of wire fraud. The charges are contained in an Indictment filed today in United States District Court in Cedar Rapids.
The Indictment alleges that, beginning in about January 2020, and continuing until June 2023, Middaugh devised a scheme to defraud and to obtain the funds of a dependent person. Middaugh used and misappropriated funds and assets from a dependent person’s bank accounts. Middaugh had access to the bank accounts as a conservator and trustee. She used the misappropriated funds for her own purposes and not for the benefit of the dependent person. This included the alleged use of approximately $52,000 for online games through the gaming platform, Skillz, Inc. The Indictment alleges five transfers of amounts between $100 and $500 to Skillz, Inc. between January 30, 2020, and January 22, 2021.
If convicted on all charges, Middaugh faces a possible maximum sentence of 100 years’ imprisonment, a $1,250,000 fine, and three years of supervised release following any imprisonment.
Middaugh’s first appearance in federal court in Cedar Rapids for arraignment is set for October 21, 2024.
As with any criminal case, a charge is merely an accusation and a defendant is presumed innocent until and unless proven guilty.
The case is being prosecuted by Assistant United States Attorney Kyndra Lundquist and was investigated by Marion Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 24-CR-0089.
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Magellan Diagnostics Sentenced for Concealing Malfunction in Lead Testing DevicesRead the Press Release
BOSTON –Magellan Diagnostics, Inc., a medical device company headquartered in Billerica, Mass., was sentenced yesterday in federal court in Boston for criminal charges related to the concealment of a device malfunction that produced inaccurately low lead test results for tens of thousands of children and other patients.
Magellan has been ordered to pay a $21.8 million fine, $10.9 million in forfeiture and a minimum of $9.3 million to compensate patient victims. Magellan pleaded guilty to two counts of introducing a misbranded medical device into interstate commerce. Magellan was charged criminally on May 21, 2024
“Keeping the people of Massachusetts safe takes a variety of forms. In the case of Magellan Diagnostics, it means protecting children who may have been exposed to dangerous levels of lead that can lead to serious health consequences. This company has admitted that it left lead blood level monitoring devices in pediatricians’ offices that it knew were providing inaccurately low readings, putting thousands of kids at risk of not having their elevated lead levels accurately diagnosed. In addition to holding the company accountable, this criminal sentence requires the company to undertake an extensive effort to identify and compensate victims.”
“Medical device makers have an obligation to provide truthful information to protect patients. By deliberately concealing and consistently misleading consumers and the FDA about device malfunctions, Magellan acted with gross disregard for its responsibility to comply with FDA requirements and put patients at risk,” said Fernando McMillian, Special Agent in Charge, FDA Office of Criminal Investigations, New York Field Office. “We will continue to thoroughly investigate those whose actions undermine the integrity of the FDA regulatory process which exists to protect consumer health.”
“It’s absolutely appalling that Magellan Diagnostics was more concerned about its bottom line than it was about coming clean to their customers and the FDA about a serious malfunction in its lead testing devices that we believe unnecessarily endangered the health of incredibly vulnerable victims,” said Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “When you’re not feeling well, and you’re trying to find out why, the last thing you should have to worry about is whether the diagnostic test you’re relying on lives up to its manufacturer’s claims. The FBI is grateful to see that the victims affected by Magellan’s actions in this case are one step closer to being compensated.”
“Magellan concealed a serious flaw in its lead testing devices while ignoring the well-being of patients and knowingly providing inaccurate results of lead levels in the blood,” said Roberto Coviello, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General. “This type of egregious conduct, which only sought to benefit the corporate bottom line, can erode the public’s trust in our nation’s health care system. Today’s sentencing should send a clear message that any company engaging in such dangerous activity will be held accountable.”
Magellan’s LeadCare Ultra and LeadCare II devices detected lead levels and lead poisoning in the blood of children and adults using either venous (blood draws through the arm) or fingerstick samples. LeadCare II, which was predominantly used to test fingerstick samples, accounted for more than half of all blood lead tests conducted in the United States from 2013 through 2017. LeadCare Ultra was predominantly used to test venous samples.
According to court documents, Magellan failed to timely notify the FDA about a serious malfunction that caused the company’s LeadCare devices to produce inaccurate blood lead level results when used to test venous blood samples. Magellan also changed the user instructions for the LeadCare devices without prior FDA notice or approval.
Magellan first learned that a malfunction in its LeadCare Ultra device could cause inaccurate lead test results – specifically, lead test results that were falsely low – during the FDA clearance process in June 2013. Magellan, however, released LeadCare Ultra to the market in late 2013 without informing customers or the FDA of the malfunction. In August 2014, LeadCare Ultra customers independently discovered the malfunction and complained about inaccurate results. FDA regulations required the company to file a medical device report about the malfunction within 30 days, but Magellan did not do so.
In November 2014, Magellan sent a letter to its LeadCare Ultra customers advising them of the malfunction and recommending that they wait 24 hours before running their tests. This contradicted the instructions for use approved by the FDA. Magellan did not, however, report the malfunction to the FDA or advise the FDA of its change to the instructions until April 2015, nearly 21 months after Magellan discovered the malfunction and almost 8 months after customers discovered the malfunction on their own. In August 2015, Magellan changed the label instructions for the LeadCare Ultra device to require users to wait 24 hours before using the device to test blood samples, rather than testing the samples immediately. FDA regulations required the company to provide advance notice of the label change and file necessary reports of device correction, but Magellan did neither.
Magellan’s testing in 2013 also indicated that the same malfunction affected the LeadCare II device when it was used to test venous samples. Magellan, however, did not notify the FDA about the LeadCare II malfunction until November 2016.
The FDA ultimately found that the LeadCare devices could not accurately test venous samples, leading to a recall of all LeadCare devices using venous samples and a warning to the public not to use LeadCare Ultra, LeadCare II or LeadCare Plus for testing venous blood samples because of the malfunction and a recommendation that doctors retest certain patients.
According to the Centers for Disease Control and Prevention, there is no safe level of lead in the blood. Lead exposure may cause irreversible lifelong physical and mental health problems. Young children and pregnant women are most vulnerable to lead exposure, especially those from low-income households and those who live in housing built before 1978 because those homes are more likely to contain lead-based paint and have fixtures containing lead.
As part of the criminal resolution, Magellan has agreed to compensate patients who were demonstrably harmed for the economic damages they suffered as a result of the malfunction in Magellan’s blood lead testing devices. If you or a family member believe you received an inaccurate blood lead test result from a LeadCare device between 2013–2017, please complete the questionnaire located on the FBI’s website at www.fbi.gov/MagellanCaseInquiry. Information about the status of the case is located on the U.S. Attorney’s Office website: https://www.justice.gov/usao-ma/victim-and-witness-assistance-program/magellan-diagnostics-inc.
Acting U.S. Attorney Levy; FDA SAC McMillan; FBI SAC Cohen; and HHS-OIG SAC Coviello made the announcement today. Assistant U.S. Attorneys James Herbert, Kelly Lawrence and Leslie Wright of the Health Care Fraud Unit prosecuted the case.
Lynn Man Charged with Threatening an Elected OfficialRead the Press Release
BOSTON – A Lynn man was arrested and charged for allegedly making threats to an elected official.
Justin David Gaglio, 50, was charged by criminal complaint with one count of transmitting interstate threats. Gaglio was arrested on Sept. 27, 2024 made an initial appearance in federal court in Boston later that day. The defendant remains in federal custody following a detention hearing held on Sept. 30, 2024, as the Court took the matter of detention under advisement.
According to the charging document, beginning in or around January 2023, Gaglio began contacting the victim via online submissions through the victim’s website. Between January 2023 and September 2024, Gaglio allegedly submitted over 80 separate messages to the victim via the website – sometimes sending multiple messages within minutes of each other.
It is further alleged that, on or about Sept. 8, 2024, Gaglio submitted a contact request to the victim’s website in which he threatened to murder the victim and their family.
The charge of transmitting interstate threats carries a maximum penalty of five years in prison, three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
Acting United States Attorney Joshua S. Levy and Jodi Cohen, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. Valuable assistance was provided by the United States Capital Police, the Massachusetts State Police and the Lynn and Salem Police Departments. Assistant U.S. Attorney Alathea E. Porter of the National Security Unit is prosecuting the case.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Los Angeles County Man Sentenced for Identity Theft OffensesRead the Press Release
FRESNO, Calif. — Sean Lamont Wyatt, 47, of Los Angeles County, was sentenced Wednesday to two years and six months in prison for committing identity theft and aggravated identity theft, U.S. Attorney Phillip A. Talbert announced.
According to court documents, in June 2021, 27 pages of victims’ personally identifiable information were found in Wyatt’s assigned inmate bunk at the federal prison in Atwater. Investigation revealed that while Wyatt was incarcerated, he used a contraband phone to call victims’ banks and creditors. In the phone calls, Wyatt used the victims’ names, dates of birth, addresses, and social security numbers to falsely identity himself and to add himself as an authorized user on the victims’ accounts. Wyatt did this to boost his own credit and then to apply for new credit lines.
This case was the product of an investigation by the U.S. Postal Inspection Service. Assistant United States Attorney Brittany M. Gunter prosecuted the case.
Licking County man sentenced to more than 4 years in prison for conspiracy crime involving videos of monkey torture & mutilationRead the Press Release
COLUMBUS, Ohio – A Licking County man was sentenced in U.S. District Court today to 54 months in prison for conspiring to create and distribute videos depicting acts of extreme violence and sexual abuse against monkeys. The sentence imposed by U.S. District Judge Edmund A. Sargus, Jr. is an upward variance from the sentencing guidelines in this case.
Ronald P. Bedra, 42, of Etna, pleaded guilty in April to conspiring to create and distribute “animal crush” videos and to distributing the videos.
According to court documents, Bedra conspired with others to create and distribute videos depicting acts of sadistic violence against baby and adult monkeys. The conspirators used encrypted chat applications to direct money to individuals in Indonesia willing to commit the requested acts of torture on camera. Bedra also mailed a thumb drive containing 64 videos of monkey torture to a co-conspirator in Wisconsin.
The videos included depictions of monkeys having their digits and limbs severed and monkeys being forcibly sodomized with a heated screwdriver.
“We will punish participants of sadistic conspiracies like this one no matter their role in the crime,” said U.S. Attorney Kenneth L. Parker of the Southern District of Ohio. “As this case shows, even if you do not commit the torture firsthand, you will be held accountable for promoting this obscene animal abuse.”
“Defendant Ronald Bedra commissioned grotesque videos of torture of juvenile and baby monkeys,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “Such appalling conduct has no place in our society. The Justice Department stands ready to prosecute individuals engaging in this activity to the fullest extent of the law.”
“Today’s sentencing underscores the U.S. Fish and Wildlife Service’s unwavering commitment to combating the exploitation of wildlife in any form,” said Assistant Director Edward Grace of the U.S. Fish and Wildlife Service’s Office of Law Enforcement. “These monstrous crimes are indefensible. This case serves as a stark reminder that those who harm animals protected under federal and international laws and treaties will face serious consequences. We continue to work diligently with our partners to identify and prosecute individuals engaged in these cruel activities to the fullest extent of the law.”
The U.S. Fish and Wildlife Service, the FBI and HSI investigated the case.
Trial Attorney Mark Romley and Senior Trial Attorney Adam Cullman of the Environmental and Natural Resource Division’s Environmental Crimes Section and Assistant U.S. Attorney Nicole Pakiz for the Southern District of Ohio are prosecuting the case.
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Lehigh County Man Sentenced to 10 Years in Prison for Trafficking MethamphetamineRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Sterling Crumblin, age 34, of Lehigh County, Pennsylvania, was sentenced on October 10, 2024, by U.S. District Court Judge Jennifer P. Wilson to 10 years in prison for trafficking methamphetamine.
According to United States Attorney Gerard M. Karam, Crumblin was sentenced for his possession with the intent to distribute methamphetamine. Crumblin received the ten-year mandatory minimum sentence for trafficking over 500 grams of methamphetamine.
Crumblin previously entered a guilty plea where he admitted that on November 15, 2021, Pennsylvania State Police conducted a traffic stop on Crumblin’s vehicle while he was driving through Dauphin County, Pennsylvania. Troopers secured a search warrant for Crumblin’s vehicle and ultimately discovered more than a kilogram of methamphetamine and a stolen handgun.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
The case was investigated by the Federal Bureau of Investigation and Pennsylvania State Police. Assistant U.S. Attorney Stephen W. Dukes is prosecuting the case.
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Kern County Man Sentenced to 7 Years in Prison for Receiving Child PornographyRead the Press Release
FRESNO, Calif. — Christopher Patterson, 43, of Bakersfield, was sentenced Wednesday to seven years in prison for receipt of child pornography, U.S. Attorney Phillip A. Talbert announced.
According to court documents, between July 2018 and November 2018, Patterson used an SD card to knowingly receive more than 600 files containing visual depictions of children, some under the age of twelve, engaging in sexually explicit conduct.
This case was the product of an investigation by Homeland Security Investigations. Assistant U.S. Attorney Brittany M. Gunter prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet-safety education.
Justice Department Secures over $6.5M from Citadel Federal Credit Union to Address Redlining of Black and Hispanic CommunitiesRead the Press Release
The Justice Department announced today that Citadel Federal Credit Union (Citadel) has agreed to pay over $6.5 million to resolve allegations that it engaged in a pattern or practice of lending discrimination by redlining predominantly Black and Hispanic neighborhoods in and around Philadelphia. This landmark agreement is the Justice Department’s first redlining settlement with a credit union, making this a historic achievement for the Combating Redlining Initiative.
Redlining is an illegal practice in which lenders avoid providing credit services to individuals living in communities of color because of the race, color or national origin of residents in those communities.
“This redlining settlement marks the Justice Department’s very first resolution involving a credit union, making clear our intent to hold all types of lenders accountable for their role in modern-day redlining,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “There are well over 4,600 credit unions across America, all subject to federal laws that prohibit redlining and lending discrimination. Redlining and other forms of lending discrimination harm communities of color and families by denying them an equal opportunity to access credit, attain the dream of homeownership and build generational wealth. This settlement will expand investment in Black and Hispanic communities, particularly in Philadelphia, and increase opportunities for homeownership and financial stability. Residents of communities harmed by unlawful redlining will finally be able to access credit services from Citadel in their own neighborhoods, including at the new branches required by the settlement.”
“For generations, Philadelphia’s communities of color have lacked equal access to the credit needed for homeownership. We know that redlining has a devastating impact on a family’s finances and future, and results in economic and other inequalities that plague our communities for decades,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “We also know the transformational change that can occur when credit is made available to underserved residents, and particularly when lenders, like Citadel, establish branch locations in these neighborhoods.”
The Justice Department’s complaint, which was filed today in the Eastern District of Pennsylvania, alleges that, from at least 2017 through 2021, Citadel failed to provide mortgage lending services to majority-Black and Hispanic neighborhoods in and around Philadelphia and discouraged people seeking credit in those communities from obtaining home loans. Citadel’s home mortgage lending was focused disproportionately on white areas around Greater Philadelphia. Peer lenders generated mortgage applications in predominately Black and Hispanic neighborhoods at nearly three times the rate of Citadel and originated mortgage loans in these areas at more than three times the rate of Citadel.
The complaint further alleges that Citadel’s branches are located almost exclusively in majority-White neighborhoods, with no branches in Philadelphia, which contains more than 75% of the majority-Black and Hispanic neighborhoods and 34% of the total population in Citadel’s market area.
Under the proposed consent order, which is subject to court approval, Citadel has agreed to invest $6.52 million to increase credit opportunities for communities of color in and around Philadelphia. Specifically, Citadel will:
- Invest at least $6 million in a loan subsidy fund to increase access to home mortgage, home improvement and home refinance loans for residents of majority-Black and Hispanic neighborhoods in Philadelphia;
- Spend at least $250,000 on community partnerships to provide services related to credit, consumer financial education, homeownership and foreclosure prevention for residents of predominantly Black and Hispanic neighborhoods in Citadel’s market area;
- Spend at least $270,000 for advertising, outreach, consumer financial education and credit counseling focused on predominantly Black and Hispanic neighborhoods in Philadelphia;
- Open three new branches in predominantly Black and Hispanic neighborhoods in Philadelphia; and
- Hire a community lending officer who will oversee the continued development of lending in communities of color.
Citadel also agreed to retain independent consultants to enhance its fair lending program and better meet the communities’ needs for mortgage credit. The credit union will conduct a community credit needs assessment, evaluate its fair lending compliance management systems, and conduct staff trainings.
With assets of approximately $6 billion, Citadel is headquartered in Pennsylvania and operates 24 branches in its market area of Greater Philadelphia, which includes Bucks, Chester, Delaware, Lancaster, Montgomery and Philadelphia Counties. Citadel is the second largest credit union in the region and has over 263,000 members. Citadel cooperated with the Justice Department’s investigation.
In October 2021, Attorney General Merrick B. Garland and Assistant Attorney General Clarke launched the Justice Department’s Combating Redlining Initiative, a coordinated enforcement effort to address this persistent form of discrimination against communities of color. Since 2021, the department has announced 14 redlining resolutions and secured over $144 million in relief for communities of color that have been the victims of lending discrimination across the country. In March, Assistant Attorney General Clarke presented remarks to America’s Credit Unions’ Governmental Affairs Conference regarding the unique issues raised by redlining in the credit union industry.
A copy of the complaint and information about the Justice Department’s fair lending enforcement work can be found at www.justice.gov/fairhousing. Individuals may report lending discrimination by calling the Justice Department’s housing discrimination tip line at 1-833-591-0291 or submitting a report online.
Justice Department Reaches Agreement with Citadel Federal Credit Union to Resolve First-Ever Redlining Action Against a Credit UnionRead the Press Release
PHILADELPHIA, PA – The United States Department of Justice announced today that Citadel Federal Credit Union (Citadel) has agreed to resolve allegations that it engaged in a pattern and practice of lending discrimination by “redlining” predominantly Black and Hispanic neighborhoods in and around Philadelphia. If approved by the court, this redlining resolution would be the Justice Department’s first involving a credit union.
“Redlining” is an illegal practice in which lenders avoid providing credit services to individuals living in certain communities or zip codes because of the race, color, or national origin of persons residing there. Under a proposed consent order filed today in federal court in conjunction with a complaint, Citadel has agreed to invest over $6.5 million to increase credit opportunities in neighborhoods of color in the Philadelphia metropolitan area. The proposed consent order also requires Citadel to establish three new branches in Black and Hispanic neighborhoods in Philadelphia over the course of five years.
In its complaint, the United States alleges that from at least 2017 through 2021, Citadel provided mortgage lending services to majority-Black and Hispanic neighborhoods in and around Philadelphia at rates far below that of comparable lenders. During the same time frame, peer lenders generated mortgage applications in predominantly Black and Hispanic neighborhoods at nearly three times the rate of Citadel and originated mortgage loans in those neighborhoods over three times as often.
The United States alleges that Citadel disproportionately focused its outreach, marketing, and home mortgage lending on the predominately White suburbs in the Greater Philadelphia region. All but one of Citadel’s full-service branches are in majority-White neighborhoods, and no branches are in Philadelphia, which contains over 75% of the majority-Black and Hispanic neighborhoods and 34% of the total population in Citadel’s market area.
Under the proposed consent order, Citadel agrees to invest at least $6 million in a loan subsidy fund to increase access to home mortgage, home improvement, and home refinance loans for residents of majority-Black and Hispanic neighborhoods in Philadelphia. Citadel will spend an additional $250,000 on community partnerships to provide credit, consumer finance, homeownership, and foreclosure prevention services to the residents of these areas, and at least $270,000 on advertising, consumer financial education, and credit counseling. Citadel will also open three new branches in predominantly Black and Hispanic neighborhoods in Philadelphia and will hire a community lending officer to oversee the continued development of lending in communities of color.
According to United States Attorney Jacqueline C. Romero, the proposed resolution presents a tremendous opportunity for long-underserved Philadelphia residents. “For generations, Philadelphia’s communities of color have lacked equal access to the credit needed for homeownership. We know that redlining has a devastating impact on a family’s finances and future, and results in economic and other inequalities that plague our communities for decades,” said Romero. “We also know the transformational change that can occur when credit is made available to underserved residents, and particularly when lenders, like Citadel, establish branch locations in these neighborhoods.”
“This redlining settlement marks the Justice Department’s very first resolution involving a credit union, making clear our intent to hold all types of lenders accountable for their role in modern-day redlining,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “There are well over 4,600 credit unions across America, all subject to federal laws that prohibit redlining and lending discrimination. Redlining and other forms of lending discrimination harm communities of color and families by denying them an equal opportunity to access credit, attain the dream of homeownership and build generational wealth. This settlement will expand investment in Black and Hispanic communities, particularly in Philadelphia, and increase opportunities for homeownership and financial stability. Residents of communities harmed by unlawful redlining will finally be able to access credit services from Citadel in their own neighborhoods, including at the new branches required by the settlement.”
The settlement is part of the U.S. Attorney General’s Combating Redlining Initiative, announced in October 2021 and aimed at coordinating agencies’ enforcement efforts to address this persistent form of discrimination. The Initiative expands the Justice Department’s reach by strengthening partnerships with U.S. Attorney’s Offices and other federal and state agencies across the country. Since 2021, the department has announced 14 redlining resolutions and secured over $144 million in relief for communities of color that have been the victims of lending discrimination across the country.
Assistant U.S. Attorney Bryan C. Hughes, Assistant U.S. Attorney Paul Kaufman (now with the District of New Jersey), Deputy Civil Chief for Civil Rights Lauren DeBruicker, and former Investigator Jeffrey Braun handled this matter for the U.S. Attorney’s Office for the Eastern District of Pennsylvania, in collaboration with attorneys from the Justice Department’s Civil Rights Division. Citadel cooperated with the Justice Department’s investigation and worked with the department to resolve the redlining allegations.
Information about the Justice Department’s fair lending enforcement work can be found here. Individuals may report lending discrimination by calling the Justice Department’s housing discrimination tip line at 1-833-591-0291 or submitting a report online.
Justice Department Files Suit for Unpaid Duties and Penalties for Alleged Misclassification and Failure to Pay Duties on Imported Chinese Solar PanelsRead the Press Release
The Justice Department has filed a civil lawsuit against Paul Bakhoum, who was the Vice President for Operations for Ecosolargy Inc., a California Corporation that imported Chinese-manufactured solar panels into the United States. The lawsuit alleges that Mr. Bakhoum made false statements to customs officials and, as a result, avoided paying harmonized tariff schedule (HTS), antidumping and countervailing duties owed on the imported solar panels.
At the time merchandise is entered into the United States, the importer is responsible for providing all information necessary to enable Customs and Border Protection (CBP) to assess the applicable duties owed on the goods, including any HTS, antidumping and countervailing duties applicable to the merchandise. The HTS sets duties based on the category of the product (for example, solar cells), while antidumping and countervailing duties are trade remedies that help protect domestic industries from unfair trade practices by foreign businesses and countries, such as government subsidies or below market sales.
The United States’ complaint contends that Bakhoum caused Ecosolargy to falsely classify solar panels imported from China as LED lights. In particular, the United States alleges that Bakhoum negligently misrepresented to CBP the imported solar panels’ HTS code and value and failed to identify both the proper antidumping duty and countervailing duty rates applicable to the panels.
“The Justice Department is committed to pursuing those who evade customs duties or otherwise engage in unfair trade practices that harm U.S. manufacturers,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to employ all of our available tools to ensure that U.S. manufacturers are competing on a level playing field.”
“CBP takes its trade mission of protecting the U.S. economy very seriously as we strive to maintain fair trade and preserve American jobs from predatory practices,” said Executive Director Susan Thomas of CBP’s Cargo and Conveyance Security, Office of Field Operations. “These civil penalties should serve as a warning to those who attempt to do harm to our economy and American businesses.”
The complaint seeks the recovery of almost $300,000 in import duties and almost $800,000 in civil penalties.
CBP’s Electronics Center of Excellence and Expertise investigated the case. CBP and Homeland Security Investigations are the agencies responsible for enforcing U.S. laws related to the importation of merchandise into the United States, including the collection of duties and assessment of penalties.
Trial Counsel Daniel Hoffman of the Civil Division’s Commercial Litigation Branch, National Courts Section, handled the case.
The case, which is filed in the Court of International Trade, is captioned United States v. Paul Bakhoum No. 24-00188.
To combat trade fraud, including avoidance of import duties, the Justice Department created a Trade Fraud Task Force. The Task Force partners with CBP and other law enforcement agencies to ensure compliance with United States trade laws.
The claims in the complaint are allegations only. There has been no determination of liability.
Justice Department Concurs with Federal Trade Commission’s Changes to Premerger Notification Form Used in Merger ReviewRead the Press Release
The Justice Department’s Antitrust Division announced today its concurrence with the Federal Trade Commission (FTC)’s unanimous vote to finalize changes to the premerger notification form and associated instructions, as well as to the premerger notification rules implementing the Hart-Scott-Rodino (HSR) Act.
The final rule, which was adopted after a rigorous public comment process, marks the first large-scale material update to the HSR form since it was first established in 1978. The rule will address critical gaps in the information available to the Justice Department and the FTC (the Agencies) when they review merger filings, making the Agencies’ initial review more efficient and effective. In response to public comment on the proposed rule, the final rule contains many changes aimed at reducing the burden on parties while still improving the information the Agencies receive to help streamline initial merger review.
“Access to better information at the beginning of the merger review process ensures that the antitrust agencies can devote our resources to the most important issues and reduces the burden on filers, third parties, and other market participants,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “I’m grateful to the Commissioners who have worked diligently to evaluate the public comments to develop the excellent rule.”
Under the HSR Act, parties to certain mergers and acquisitions are required to submit premerger notification forms that disclose certain information about their proposed deal and business operations. The Agencies use this information to conduct a premerger assessment in the short time allowed under the HSR Act, typically 30 days, to determine which transactions may violate the antitrust laws, and thus require additional review.
The requests added to the HSR form reflect the dramatic changes over the past four decades in global markets and in how mergers and acquisitions are conducted. These additions include:
- Requiring parties to submit transaction-related documents prepared by or for the supervisory leader of the deal team;
- Requiring parties to describe their principal categories of products and services as reflected in the parties’ ordinary course business documents;
- Requiring disclosure of additional information about the buyer’s officers, directors, and investors, including those with management rights over the firm; and
- Ensuring the Agencies have access to translations of all documents submitted in a language other than English.
This additional information will enable the Agencies to streamline their initial reviews and make decisions more quickly. In some circumstances, it will allow the Agencies to evaluate a merger without opening a preliminary investigation or seeking additional information through a second request. In this way, the final rule complements the FTC’s decision to lift its temporary suspension on early termination of HSR filings. When additional information is necessary to review a merger, the final rule will enable the Agencies to issue more targeted requests, reducing the time and effort required to respond. Under the prior form, the Agencies routinely had to rely on third parties, many of whom were small businesses, to fill in informational gaps. By helping to fill some of these gaps, the final rule can alleviate the burden on third parties as well.
The new information required by the final rule is already within the possession of the filing parties. The rule was carefully structured to provide the Agencies with important additional factual and documentary information that is readily available to the merging parties. Moreover, the Agencies carefully reviewed the hundreds of public comments filed in response to the proposed rule and made substantial changes to reduce the burden on merging parties. The final rule differs from the proposed rule in many ways, including among other things, eliminating the requirements to:
- Submit preliminary drafts of deal-related documents;
- Collect and produce ordinary course documents from people who report directly to the CEO;
- Provide information about employees’ commuting zones and occupation classifications;
- Report prior acquisitions that are more than five years old or involve entities with less than $10 million in sales or revenue; and
- Certify that the filer took steps to preserve documents.
These changes eliminated substantial costs to filing parties while ensuring that the Agencies will receive the additional information they require to more effectively and efficiently review merger filings.
The final rule will be effective 90 days after it is published in the Federal Register.
Jury Returns Guilty Verdict Against District Man on First-Degree Murder While Armed for 2020 ShootingRead the Press Release
WASHINGTON – A jury sitting in Superior Court today found Dennis Chase, 32, of Washington, D.C., guilty of first-degree murder while armed, possession of a firearm during a crime of violence, and unlawful possession of a firearm in the December 2020 shooting death of Anthony Orr. The verdict was announced by U.S. Attorney Matthew M. Graves and Chief Pamela A. Smith, of the Metropolitan Police Department (MPD). Sentencing is scheduled for January 10, 2024.
According to the government’s evidence, the defendant drove around the Washington Highlands neighborhood with the victim, Anthony Orr, sitting in the passenger seat. As the defendant slowly drove down Xenia St SE, he raised a gun to Mr. Orr’s head and fired one lethal shot. The defendant pushed Mr. Orr out of the car and sped off. The defendant drove 30 miles North of the District to the woods of Severn, Maryland, where he doused the car in diesel exhaust fluid and attempted to light it on fire. The defendant then hiked through the woods until he found a random home, where he stripped down and hid his clothes and other evidence in the back shed, knocked on the back door, and asked for help. The homeowner called 911, and Anne Arundel County Police arrested the defendant on an unrelated warrant. MPD Homicide Detectives later charged defendant for the murder of Mr. Orr. The defendant claimed he acted in self-defense.
This case was investigated by the Metropolitan Police Department and Assistant United States Attorney Peter Roman. It was prosecuted and tried by Assistant United States Attorneys Wes Faulkner and Andrea Antonelli.
Jury Convicts Omaha Man for Selling Fentanyl that Resulted in the Death of a Four-Year OldRead the Press Release
United States Attorney Susan Lehr announced Michael Reis, age 29, of Omaha, Nebraska was convicted by a jury on October 9, 2024, in federal court in Omaha for distributing fentanyl that resulted in the death of 4-year-old. United States District Judge Brian C. Buescher presided over the trial.
On March 12, 2022, Douglas County Sheriff’s Office (DCSO) Deputies were dispatched to the Aspen Grove apartment complex for an unresponsive 4-year-old. Upon arrival, deputies began CPR until an ambulance could take the child to Children’s Hospital and Medical Center. The child was later pronounced dead due to fentanyl toxicity.
DCSO crime scene investigators, laboratory technicians, and fentanyl overdose investigators assisted in the investigation. Michael Reis was eventually identified as a person of interest. On March 27, 2022, Reis was arrested on an outstanding warrant. A search warrant was executed on Reis’s phone which detailed an extensive history of selling pills to the child’s mother. Messages found in Reis’s phone from March 12, 2022, showed that Reis delivered a pill to the child’s mother and that Reis received digital payment from her.
In addition to the testimony by DCSO investigators, Dr. Robert Bowen and Dr. Suzanne Haney testified extensively on the child’s cause of death . Dr. Bowen is the Douglas County Coroner’s physician assistant (pathologist) and Dr. Haney is both the Medical Director of Project Harmony and Chief Physician of Child Abuse Pediatrics at Children’s and the University of Nebraska Medical Center.
“I am immensely proud of the team efforts of our DCSO Deputies and our local and federal partners in law enforcement, as well as the U.S. Attorney’s Office, to bring justice to [this child],” said Douglas County Sheriff Aaron Hanson. “Fentanyl and fentanyl dealers are a true scourge in our community. Those who deal and recklessly possess fentanyl should know that there is no room for them in a safe civil society and that they will be pursued and prosecuted to the fullest extent of the law.”
Sentencing is set for January 9, 2024. The penalties for distributing fentanyl resulting in death include a mandatory minimum term of imprisonment of 20 years. There is no maximum sentence.
Michael Reis has a second federal case in which he pled guilty to sex trafficking of a minor. Sentencing for that matter is set for December 5, 2024. The penalties for sex trafficking a minor include a mandatory minimum term of imprisonment of 10 years. The maximum sentence is life.
This case was investigated by the Douglas County Sheriff’s Office and the Drug Enforcement Administration.
Jerome Man Convicted of Possession with Intent to Distribute Methamphetamine Sentenced to 7 Years in Federal PrisonRead the Press Release
BOISE – Jason Earl Wright, 49, of Jerome, was sentenced to 84 months in federal prison for possession with intent to distribute methamphetamine, U.S. Attorney Josh Hurwit announced today.
According to court records, Wright was involved in a drug trafficking organization spanning Idaho and Oregon, though his conduct was limited to the Idaho arm of this organization. Wright was found with a total of more than one and a quarter pounds of methamphetamine, two firearms, and a small amount of cocaine between the dates of June 28, 2023 and February 7, 2024. When he was arrested after his federal indictment, he was in possession of a loaded handgun, two loaded magazines, more than an ounce of methamphetamine, two cell phones, two scales, small plastic baggies, and two drug ledgers.
Senior U.S. District Judge B. Lynn Winmill also ordered Wright to pay a $500 fine and to serve four years of supervised release following his prison sentence.
U.S. Attorney Hurwit commended the work of the Drug Enforcement Administration, the Nampa Police Department Special Investigations Unit, the Meridian Police Department, the Boise Police Department, the Oregon State Police High Desert Drug Task Force, and the U.S. Marshals Service, which led to the charges and arrest. Assistant U.S. Attorney David Morse and former Special Assistant U.S. Attorney Marie Chong prosecuted this case.
This case was prosecuted by the Special Assistant U.S. Attorney hired by the Ada County Prosecuting Attorney’s Office with funds provided by the Oregon-Idaho High Intensity Drug Trafficking Areas (HIDTA) program. HIDTA is an Office of National Drug Control Policy (ONDCP) sponsored counterdrug grant program that coordinates with and provides funding resources to multi-agency drug enforcement initiatives, including the Special Assistant U.S. Attorney position.
The High Desert Drug Task Force is a multi-jurisdictional narcotics task force that identifies, disrupts, and dismantles local, multi-state, and international drug trafficking organizations using an intelligence-driven, multi-agency prosecutor-supported approach. They are supported by the Oregon-Idaho High-Intensity Drug Trafficking Area (HIDTA).
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Ithaca Man Sentenced to Serve 24 Months in Federal Prison for Pandemic Loan FraudRead the Press Release
SYRACUSE, NEW YORK – Ejembi Onah, age 61, of Ithaca, New York, was sentenced to serve 24 months in federal prison yesterday following trial convictions for two counts of wire fraud and three counts of transacting in criminally derived property for fraudulently obtaining two Paycheck Program (PPP) loans during the pandemic, receiving over $140,000 in loan proceeds, and spending those proceeds, among other things, in three separate transactions each exceeding $10,000.
United States Attorney Carla B. Freedman; Thomas Fattorusso, Executive Special Agent in Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (IRS-CI); and Erin Keegan, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI), made the announcement.
PPP loans were United States Small Business Administration (SBA)-guaranteed, forgivable loans authorized in the Coronavirus Aid Relief, Economic Security (CARES) Act, which was enacted in March 2020 to provide emergency financial assistance to Americans suffering adverse economic effects from the COVID-19 pandemic.
The government’s evidence at Onah’s October 2023 non-jury trial established that Onah submitted two fraudulent PPP loan applications to two different lenders in June 2020. Each application included false information about the payroll and number of employees at Onah’s company, which he claimed was engaged in a seasonal nanotechnology business and were supported by falsified tax returns. Onah spent the more than $140,000 he received to, among other things, pay back rent at his personal residence, lease a luxury car, and pay for his daily living expenses.
United States District Judge David N. Hurd also ordered that Onah serve a two-year term of supervised release following his release from prison and pay $218,983.32 in restitution to his victims.
IRS-CI and HSI investigated the case. Assistant United States Attorneys Michael D. Gadarian and Joshua R. Rosenthal prosecuted the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
IMPD Sergeant Facing Federal Charges for Possession and Distribution of Child Sexual Abuse MaterialRead the Press Release
INDIANAPOLIS—A federal grand jury has returned an indictment charging Indianapolis Metropolitan Police Department Sergeant, Javed Richards, 42, with five counts of distribution of child sexual abuse material and one count of possession of child sexual abuse material. Richards had his initial appearance in federal court on October 10th.
According to the indictment, on July 14, 2024, Richards allegedly distributed at least five videos of minors under the age of 12 engaged in sexually explicit conduct to other individuals via the Kik messenger application. Richards is further charged with possessing numerous images and videos of child sex abuse material on his iCloud account.
IMPD announced it has suspended Sergeant Richards pending a recommendation of termination to the IMPD Civilian Police Merit Board.
The FBI and Indiana Internet Crimes Against Children Task Force is investigating this case, with cooperation from the Indianapolis Metropolitan Police Department. If convicted, Richards faces up to 20 years in federal prison.
U.S. Attorney Myers thanked Assistant U.S. Attorney Tiffany J. Preston, who is prosecuting this case.
This investigation was conducted by the FBI which is part of the Indiana Internet Crimes Against Children (ICAC) Task Force, a multiagency task force led by the Indiana State Police that investigates and prosecutes persons who use the internet to sexually exploit or entice children. Each year, Indiana ICAC investigators evaluate thousands of tips, investigate hundreds of cases, and rescue dozens of children from ongoing sexual abuse. Visit https://www.internetcrimesagainstkids.com to learn more about their efforts.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Harrison County Man Sentenced for Methamphetamine ChargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Todd Eugene Haynes, age 49, of Clarksburg, West Virginia, was sentenced today to 10 years in federal prison for the distribution of methamphetamine.
According to court documents and statements made in court, Haynes sold more than 100 grams of methamphetamine in Harrison County.
Haynes has a criminal history that includes robbery, battery, domestic assault, stalking, and drug possession. He will serve five years of supervised release following his prison sentence.
Assistant U.S. Attorney Brandon Flower prosecuted the case on behalf of the government.
The Greater Harrison Drug Task Force, a HIDTA-funded initiative, investigated.
Chief U.S. District Judge Thomas S. Kleeh presided.