Central District of California

          LOS ANGELES – A former Major League Baseball (MLB) player has agreed to plead guilty to a federal charge for lying to federal law enforcement officials about bets on sporting events that he placed with an illegal gambling operation, according to court documents unsealed today.

          Yasiel Puig Valdés, 31, who currently plays professional baseball in South Korea, has agreed to plead guilty to one count of making false statements, a crime that carries a statutory maximum sentence of five years in federal prison.

          Puig, who formerly played for the Los Angeles Dodgers and two other MLB franchises, has agreed to pay a fine of at least $55,000. Puig has agreed to make his initial appearance on November 15 in United States District Court.

          “Under our system of justice, no one is above the law,” said United States Attorney Martin Estrada. “The integrity of our nation’s criminal justice system depends on people telling the truth, and those who fail to abide by this simple principle must face consequences.”

          “When given the opportunity to be truthful about his involvement with Nix’s Gambling businesses, Mr. Puig chose not to,” said IRS Criminal Investigation Los Angeles Field Office Special Agent in Charge Tyler Hatcher. “Mr. Puig’s lies hindered the legal and procedural tasks of the investigators and prosecutors.”

          “Lying to federal agents is a serious offense,” said HSI Los Angeles Acting Special Agent in Charge Eddy Wang. “HSI Los Angeles and our partners will actively pursue those that seek to hinder the fair administration of justice.”

          According to his plea agreement, which was filed on August 29, in May 2019, Puig began placing bets on sporting events through a third party – identified in court documents as “Agent 1” – who worked on behalf of an illegal gambling business run by Wayne Joseph Nix, 46, of Newport Coast.

          Puig called and sent text messages to Agent 1 with wagers on sporting events. Agent 1 then submitted the bets to the Nix gambling business on Puig’s behalf. By June 2019, Puig owed Nix’s gambling business $282,900 for sports gambling losses.

          Agent 1 and another person identified in court papers as “Individual B” instructed Puig to make a check or wire transfer payable to a Nix gambling business client – identified in court papers as “Individual A” – to whom the business owed at least $200,000 in gambling winnings.

          On June 25, 2019, Puig withdrew $200,000 from a Bank of America branch in Glendale then purchased two cashiers’ checks for $100,000 each that were made payable to Individual A. Puig did not immediately send the checks due to a dispute over the balance and access to Nix-controlled websites used to place sports bets. Nix refused to allow Puig access to the betting websites until Puig’s gambling debt was paid.

          After Puig paid the $200,000, Nix provided Puig direct access to the betting websites. From July 4, 2019 to September 29, 2019, Puig placed 899 additional bets on tennis, football and basketball games through the websites.

          In January 2022, federal investigators interviewed Puig in the presence of his lawyer. During the interview, despite being warned that lying to federal agents is a crime, Puig lied several times. During the interview, he falsely stated that he only knew Agent 1 from baseball and that he never discussed gambling with him, when in fact Puig discussed sports betting with Agent 1 hundreds of times on the telephone and via text message.

          After agents showed Puig a copy of one of the cashiers’ checks he purchased on June 25, 2019, Puig falsely stated that he did not know the person who instructed him to send $200,000 in cashiers’ checks to Individual A. Puig also falsely stated that he had placed a bet online with an unknown person on an unknown website that resulted in a loss of $200,000.

          In March 2022, Puig sent Individual B an audio message via WhatsApp in which he admitted to lying to federal agents during the interview two months earlier.

          Nix pleaded guilty on April 11 to one count of conspiracy to operate an illegal sports gambling business and one count of filing a false tax return. His sentencing hearing is scheduled for March 8, 2023.

          Federal prosecutors today also filed a plea agreement for former MLB player Erik Kristian Hiljus, 49, of Panorama City, who agreed to plead guilty to two counts of subscribing to false tax returns and will face up to six years in federal prison upon entering his guilty plea. Hiljus was an agent for Nix’s illegal gambling business but did not work with Puig.

          Homeland Security Investigations (HSI) and IRS Criminal Investigation are investigating this matter. The HSI agents are part of the El Camino Real Financial Crimes Task Force.

          Assistant United States Attorneys Jeff Mitchell of the Major Frauds Section and Dan Boyle of the Asset Forfeiture and Recovery Section are prosecuting these cases.

          SANTA ANA, California – A former executive at an Orange County commercial real estate agency was arrested today on a federal criminal complaint alleging a decade-long scheme in which he stole $2.5 million by submitting fictitious invoices for companies controlled by his family and friends whose services were never performed.

          Varun Aggarwal, 40, of Irvine, California, was arrested this morning by special agents with the FBI. He is scheduled to make his initial appearance this afternoon in United States District Court in Santa Ana.

          Aggarwal is charged with one count of mail fraud and one count of wire fraud.

          According to an affidavit filed with the complaint that was unsealed today, beginning at least in 2012 and continuing through January 2022, Aggarwal used his position at the Newport Beach-based KBS Realty Advisors to embezzle his employer’s money.

          During his decade-long tenure at KBS, Aggarwal worked in the company’s internal auditing department, rising to the level of the department’s director. As a member of the company’s accounting group, Aggarwal was intimately familiar with KBS’s policies and procedures for payments to vendors. Aggarwal used his knowledge of KBS’s policies and procedures to have his friends and family perform contracting work for his groups at KBS.

          After several of these companies became approved vendors for KBS, Aggarwal used these approved vendors to submit fraudulent invoices for consulting services that were not performed for the company, the complaint alleges. He then funneled the payments on the invoices from KBS to his own bank accounts – through the approved vendors – at times without informing the vendors that the invoices and the payments on the invoices were for his own benefit.

          Aggarwal resigned from KBS in January 2022 after the company began investigating the invoices, the affidavit states.

          A review of company, bank and tax records show that Aggarwal, using approximately six vendors, stole approximately $2,601,246 from KBS between approximately January 1, 2012, and January 13, 2022, according to the affidavit.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          If convicted of both counts, Aggarwal would face a statutory maximum sentence of 40 years in federal prison.

          The FBI investigated this matter.

          Assistant United States Attorney Brett A. Sagel of the Santa Ana Branch Office is prosecuting this case.

          LOS ANGELES – Based on the actions of its agents, including its billionaire Chinese real estate developer owner, a downtown Los Angeles-based company was found guilty today of paying more than $1 million in bribes – including luxury trip expenses, casino gambling chips and a sham loan – to then-Los Angeles City Councilman José Huizar to obtain city approval to build a 77-story skyscraper.

          After the jury deliberated for less than three hours, Shen Zhen New World I LLC was found guilty of all eight counts it faced: three counts of honest service wire fraud, four counts of interstate and foreign travel in aid of bribery, and one count of bribery.

          The owner of Shen Zhen – Wei Huang, 57, a resident of Shenzhen, China, who also maintains a residence in San Marino – is also charged in this case, but he has yet to make a court appearance in this matter. He is a fugitive believed to be in China.

          According to evidence presented at trial, in 2010, Shen Zhen – on behalf of its owner – purchased the L.A. Grand Hotel in downtown Los Angeles. The property was located in the 14th City Council District, whose representative at that time was José Huizar. As part of his roles on the Los Angeles City Council, Huizar was the chairman of the Planning and Land Use Management Committee, commonly referred to as the PLUM Committee, which oversaw major commercial and residential development projects in the city.

          In June 2018, Shen Zhen filed an application with the Los Angeles City Planning Department to redevelop the L.A. Grand Hotel into a skyscraper featuring a mix of residential and commercial uses.

          From February 2013 to November 2018, Shen Zhen, acting through Huang, provided Huizar and his aide George Esparza with cash, casino gambling chips, flights on private jets and commercial airlines, stays at luxury Las Vegas hotels and casinos, expensive meals, spa services, prostitution services, political contributions, and a $600,000 collateral for Huizar to confidentially settle a pending sexual harassment lawsuit against Huizar by a former staffer that threatened his career.

          At the time Shen Zhen provided these items, it did so intending to influence Huizar to take official acts to benefit the L.A. Grand Hotel redevelopment project, a project that would have transformed Shen Zhen’s hotel into a 77-floor mixed use skyscraper that would have been the tallest such structure west of the Mississippi River.

          Specifically, Shen Zhen intended that Huizar benefit the project by presenting motions and resolutions in various city committees; voting on the project in the PLUM Committee and City Council; taking action in the PLUM Committee to expedite the approval process of the project; exerting pressure on other city officials to influence the approval process of the project; and introducing and voting on city resolutions to enhance the professional reputation and marketability of Wei Huang.

          United States District Judge John F. Walter scheduled a January 23, 2023 sentencing hearing, at which time the company is expected to face a multi-million dollar fine.

          Huizar and former Deputy Mayor Raymond Chan have pleaded not guilty to the charges against them, which include racketeering conspiracy and multiple bribery counts, and are scheduled to go to trial on February 21, 2023. Esparza pleaded guilty in July 2020 to one count of racketeering conspiracy, and is scheduled to be sentenced on June 5, 2023.

          Federal prosecutors have now convicted a total of nine defendants along with receiving over $3 million in criminal penalties to resolve their investigation into two other major real estate development companies, as a result of Operation “Casino Loyale,” the ongoing corruption investigation into Los Angeles City Hall being conducted by the FBI and the United States Attorney’s Office.

          Salvador Huizar, José Huizar’s brother who testified as a witness for the prosecution in the Shen Zhen trial and is expected to testify at his brother’s trial, is scheduled to be sentenced on May 15, 2023 after he pleaded guilty to a felony charge of making false statements to federal investigators.

          In the first Huizar-related trial in this case, a federal jury on June 27 found real estate developer Dae Yong Lee, a.k.a. David Lee, 57, of Bel Air, and 940 Hill LLC, a Lee-controlled company, guilty of felony charges, including fraud and bribery, for providing $500,000 in cash to Huizar and his special assistant in exchange for their help in resolving a labor organization’s appeal of their downtown Los Angeles development project. Their sentencing hearings are scheduled for January 30, 2023.

          Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, Assistant United States Attorneys Susan S. Har and J. Jamari Buxton, also of the Public Corruption and Civil Rights Section, and Assistant United States Attorney Patrick Castañeda of the International Narcotics, Money Laundering, and Racketeering Section, are prosecuting this case.

          Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s tip line at tips.fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.

          LOS ANGELES – A Filipino man who fatally stabbed a fellow crewmember on a container ship en route from Shanghai to Los Angeles was sentenced today to 240 months in federal prison.

          Michael Dequito Monegro, 44, a resident of the Philippines, was sentenced by United States District Judge Dale S. Fischer, who said in court at today’s hearing that Monegro’s “conduct was unusually heinous, cruel and brutal.”

          Monegro pleaded guilty on May 2 to one count of committing an act of violence against a person onboard a ship that is likely to endanger the safe navigation of the ship.

          In September 2020, Monegro was working as a seaman aboard the MSC Ravenna, a 153,000-gross-ton Liberian-flagged container ship. The murder took place on September 20, 2020, when the Ravenna was approximately 80 nautical miles from Southern California and nearing the end of its two-week voyage from Shanghai to the Port of Los Angeles.

          That morning, several crewmembers were in a dressing room on the ship’s upper deck, preparing for their shift and waiting for their direct supervisor to provide their work assignments for the day. Shortly after Monegro saw his direct supervisor – identified in court documents as “M.S.” – in the hallway outside the locker room, Monegro began stabbing him with a knife while they were both in the hallway in full view of several crewmembers.

          The victim grappled with Monegro and the two fell to the floor. Monegro then got on top of the victim and continued stabbing him. Monegro then removed a second knife from the victim’s coveralls and stabbed him with both knives.

          Crewmembers attempted to intervene to stop Monegro, including throwing a trash can at him, but their actions were unsuccessful. Monegro stopped stabbing the victim only when he became too tired to continue. In total, Monegro stabbed the victim 31 times.

          The ship’s captain, chief mate and chief engineer all arrived on scene during the incident, and the captain convinced Monegro to get off the victim, who died on the ship from multiple stab wounds.

          Monegro was convinced by the captain to walk to a conference room. After continued discussions, Monegro placed the knives on the conference room table and was escorted to his cabin.

          After the incident, Monegro was confined to a cabin and crewmembers were assigned to guard the door, so they were unable to perform their normal duties on the ship. Other crewmembers were traumatized by witnessing Monegro stab and kill the victim.

          Federal agents arrested Monegro after the ship docked at the Port of Los Angeles on September 27, 2020. He has been in federal custody since his arrest.

          “The tragic impact of defendant’s conduct cannot be overstated,” prosecutors argued in a sentencing memorandum. “[Monegro’s] murder of M.S. left behind M.S.’s wife and daughter, who was 17 at the time of the murder. M.S. was the sole bread winner for the family, and his death caused significant financial strain on the family.”

          The FBI and the United States Coast Guard Investigative Service investigated this matter.

          Assistant United States Attorney Matthew W. O’Brien of the Environmental and Community Safety Crimes Section, Assistant United States Attorney Mark A. Williams, Chief of the Environmental and Community Safety Crimes Section, and Assistant United States Attorney Jeffrey M. Chemerinsky of the Violent and Organized Crime Section prosecuted this case.

          LOS ANGELES – A prolific international fraudster who conspired to launder tens of millions of dollars through a series of online scams and flaunted his luxurious, crime-funded lifestyle on social media was sentenced today to 135 months in federal prison.

          Ramon Olorunwa Abbas, a 40-year-old Nigerian national, also known by his Instagram handle, “Ray Hushpuppi,” was sentenced by United States District Judge Otis D. Wright II, who also ordered Abbas to pay $1,732,841 in restitution to two fraud victims.

          Abbas pleaded guilty in April 2021 to one count of conspiracy to engage in money laundering. He was arrested in Dubai, United Arab Emirates, in June 2020 and has remained in federal custody since his expulsion from the UAE.

          “Abbas bragged on social media about his lavish lifestyle – a lifestyle funded by his involvement in transnational fraud and money laundering conspiracies targeting victims around the world,” said United States Attorney Martin Estrada. “Money laundering and business email compromise scams are a massive international crime problem, and we will continue to work with our law enforcement and international partners to identify and prosecute those involved, wherever they may be.”

          “Ramon Abbas, a.k.a. ‘Hushpuppi,’ targeted both American and international victims, becoming one of the most prolific money launderers in the world,” said Don Alway, the Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Abbas leveraged his social media platforms – where he amassed a considerable following – to gain notoriety and to brag about the immense wealth he acquired by conducting business email compromise scams, online bank heists and other cyber-enabled fraud that financially ruined scores of victims and provided assistance to the North Korean regime. This significant sentence is the result of years’ worth of collaboration among law enforcement in multiple countries and should send a clear warning to international fraudsters that the FBI will seek justice for victims, regardless of whether criminals operate within or outside United States borders.”

          Abbas conspired with Ghaleb Alaumary, 37, of Mississauga, Ontario, Canada, a convicted money launderer, to launder funds derived from various crimes, including bank cyber-heists, business email compromise (BEC) schemes and other online frauds.  BEC schemes typically involve gaining unauthorized access to a business email account and attempting to trick a victim business into making an unauthorized wire transfer.

          In January 2019, Abbas conspired with Alaumary to launder funds stolen from a bank in Malta by providing account information for banks in Romania and Bulgaria. The United States has charged North Korean hackers with committing the bank cyber-heist in Malta, and alleged that those funds were destined for the North Korean government. Abbas has admitted that the intended loss with respect to the Maltese bank was approximately $14.7 million.

          In May 2019, Abbas conspired with Alaumary to launder millions of pounds stolen from a professional soccer club in the United Kingdom as well as a British company. In connection with that scheme, Abbas provided Alaumary with details for a bank account in Mexico that “could handle millions and not block,” according to court documents.

          Abbas also fraudulently induced a New York-based law firm in October 2019 to transfer approximately $922,857 to an account that a co-conspirator controlled under someone else’s name.

          Alaumary was charged separately and pleaded guilty in November 2020 to one count of conspiracy to engage in money laundering. He is serving a 140-month federal prison sentence and was ordered to pay more than $30 million in restitution.

          Abbas also admitted in his plea agreement to conspiring with others to defraud an individual in Qatar who sought a loan of $15 million to build a school.

          At today’s sentencing hearing, Judge Wright ordered Abbas to pay $922,857 in restitution to the law firm victim and $809,983 in restitution to the businessperson in Qatar.

          Abbas and another conspirator duped the victim businessperson into paying approximately $330,000 to fund an “investor’s account” to facilitate the loan. Abbas specifically directed the victim to send $100,000 to a bank account controlled by a co-conspirator, and $230,000 to the bank account of a luxury watch seller. Abbas used those funds for his personal benefit, including purchasing a $230,000 Richard Mille RM11-03 watch, which he arranged to have brought to him from New York to Dubai.  The watch made numerous appearances on Abbas’ wrist on his now-defunct Instagram account, often with the hashtag #RichardMille.

          Approximately $50,000 of proceeds from the scheme were used to fraudulently acquire a St. Christopher (St. Kitts) and Nevis citizenship and a passport for Abbas through a sham marriage to a St. Kitts citizen.

          In January and February 2020, Abbas and another conspirator corresponded with the victim businessperson, attempting to fraudulently induce a further payment of $575,000 in purported taxes to release the $15 million loan. In February 2020, the victim sent approximately $299,983 to Kenyan bank accounts specified by another conspirator. In March 2020, Abbas fraudulently induced the victim to send another $180,000 to U.S.-based bank accounts; those funds were subsequently laundered with assistance from several co-conspirators.

          “By his own admission, during just an 18-month period defendant conspired to launder over $300 million,” prosecutors wrote in a sentencing memorandum. “While much of this intended loss did not ultimately materialize, [Abbas’] willingness and ability to participate in large-scale money laundering highlights the seriousness of his criminal conduct.”

          The FBI investigated this matter as part of Operation Top Dog. The FBI thanks the government of the United Arab Emirates and the Dubai Police Department for their substantial assistance in this matter.

          Assistant United States Attorney Khaldoun Shobaki of the Cyber and Intellectual Property Crimes Section prosecuted this case. The Justice Department Criminal Division’s Office of International Affairs provided substantial assistance in this matter.

          LOS ANGELES – A Clarkston, Michigan man was sentenced today to 42 months in federal prison for his role in a series of “SIM swapping” schemes that allowed him and his accomplices to take control of online accounts, which resulted in the theft of cryptocurrency, causing more than $28,000 in losses.

          Anthony Joseph Carlson, 25, also conducted a separate “phishing” scheme to hijack valuable Instagram accounts, which he was able to monetize. And he defrauded other victims by selling stolen Instagram accounts, causing additional losses of over $93,000.

          Carlson was sentenced by United States District Judge Percy Anderson, who scheduled a hearing for January 18, 2023, to determine the amount of restitution that the defendant will be ordered to pay to approximately 10 individuals and companies.

          Carlson pleaded guilty on August 22 to four felony offenses – two counts of conspiracy to commit wire fraud and two counts of unauthorized access to a protected computer to obtain information.

          Judge Anderson today emphasized the seriousness of the cybercrimes by saying, “It’s the same as if the defendant was actually robbing the victims,” later adding, “You don’t get a break because you used a computer.”

          SIM swapping is fraud in which cell phone service providers are tricked into reassigning a victim’s cell phone number to a new cell phone controlled by a fraudster, without the victim’s knowledge or authorization. The new cell phone device has a new Subscriber Identification Module (SIM), thus, SIM swapping. After hijacking a victim’s phone service, a SIM swapper is able to receive communications intended for the victim, including password reset codes for a victim’s online accounts. Carlson worked with others in SIM swapping schemes to reset victim account passwords, take over victims’ online accounts and steal cryptocurrency.

          Carlson participated in two separate conspiracies to use SIM swapping to gain unauthorized access to the email, financial and social media accounts of the victims to steal cryptocurrency. One scheme that did not result in any actual losses involved the takeover of a Coinbase account in order to steal $10,000 in cryptocurrency, and a second involved the takeover of a Facebook account that allowed Carlson and a co-conspirator to obtain cryptocurrency from two friends of the person whose account had been compromised.

          As a result of a separate phishing scheme – in which Carlson sent emails purporting to be from a legitimate source to induce victims to reveal information, including personal identifying information and passwords – he was able to gain control of valuable Instagram accounts with large numbers of followers. Carlson told the victims who owned the Instagram accounts that he wanted to purchase advertising on their accounts, but he needed to first determine how valuable their accounts were for marketing purposes. Carlson convinced the victims to download his purported analytics software, which had a spoofed website name almost identical to a commonly used Instagram analytics software, and they were tricked into providing their Instagram usernames and passwords, which Carlson used to take over their Instagram accounts to monetize for his personal gain.

          Carlson also obtained stolen Instagram accounts from others and then re-sold them to other victims for thousands of dollars. In another scheme, Carlson collected money for advertising on Instagram accounts he did not actually control.

          The Federal Bureau of Investigation conducted the investigation in this matter.

          Assistant United States Attorney Lisa E. Feldman of the Cyber and Intellectual Property Crimes Section prosecuted this case.

          LOS ANGELES – A San Bernardino County man – at whose home dozens of illegal firearms lacking serial numbers, commonly known as “ghost guns,” allegedly were found – was arrested today on a federal criminal complaint alleging he acted as an unlicensed firearms dealer.

          Puleaga Pele, 44, of Hesperia, was arrested at his residence this morning as law enforcement executed a search warrant there. He is charged with one count of unlicensed dealing in firearms.

          Pele is expected to make his initial court appearance on Monday at United States District Court in downtown Los Angeles.

          According to an affidavit filed with the complaint, in July 2022, law enforcement searched a San Fernando Valley residence as part of a separate investigation. While reviewing the digital device of a target of the investigation, law enforcement allegedly discovered communications in which an individual – later identified as Pele – offered to sell the target of an investigation multiple firearms, which appeared to be of unknown manufacturer and without a serial number.

          Law enforcement later traced the firearms to Pele’s residence, which was searched this morning pursuant to a warrant, the affidavit states. Inside Pele’s house and in a Hummer truck in the garage, law enforcement allegedly found a total of 33 firearms, of which 10 were privately manufactured firearms (a.k.a. “ghost guns”), a stolen firearm, a machinegun, thousands of rounds of ammunition, and assorted high- capacity magazines and firearm parts.

          Pele does not have a federal firearms license for buying or selling firearms, according to the affidavit.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          If convicted of this charge, Pele would face a statutory maximum sentence of five years in federal prison.

          Homeland Security Investigations and the Los Angeles Police Department are investigating this matter.

          Assistant United States Attorneys Jeffrey M. Chemerinsky, Kevin B. Reidy, and Bruce K. Riordan of the Violent and Organized Crime Section are prosecuting this case.

          LOS ANGELES – A member of the San Fernando Valley-based Vineland Boys who helped run the street gang’s drug trafficking operations has been sentenced to 120 months in federal prison for federal racketeering and narcotics crimes, the Justice Department announced today.

          Mark Anthony Espinosa, 43, of Lancaster, was sentenced late Tuesday afternoon by United States District Judge Michael W. Fitzgerald.

          Espinosa pleaded guilty on April 7 to one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act and one count of conspiracy to distribute drugs, including methamphetamine.

          According to court documents, from November 2015 to November 2019, Espinosa was a member of the Pequeños clique of the Vineland Boys. Espinosa conspired with other Vineland Boys gang members to sell drugs throughout the gang’s “territory.” Espinosa also acted as a drug supplier and sell drugs within Vineland Boys territory, operate drug and firearms stash locations, and enforce the gang’s extortion of drug dealers, including through violence.

          In his plea agreement, Espinosa admitted to committing a series of criminal activities, including a March 2016 meeting in which he discussed an incident in which he and another Vineland Boys gang member held a gun to the head of an individual in a back-alley confrontation.

          Espinosa also admitted to engaging in a drug deal in June 2016, in which he and a co-defendant sold approximately 112 grams of methamphetamine to a buyer who paid $700.

          In 2019, a federal grand jury indicted 31 Vineland Boys members and associates. So far, federal prosecutors have secured 29 convictions in this case, including 14 convictions that have resulted in prison sentences of at least 10 years. One of them, Vineland Boys gang member Jesus Gonzalez Jr., 29, “Lil Chito,” “Gunner” and “Chuy,” of Sun Valley, is serving a 31-year federal prison sentence for committing multiple felonies, including the attempted murders of three rival gangsters.

          This case’s lead defendant, Mario Alberto Miranda, 31, of Sherman Oaks, an alleged Vineland Boys shot caller, and Ulises Botello, 46, of Palmdale, are scheduled to go to trial in October 2023 on racketeering conspiracy and narcotics charges.

          The FBI, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, IRS Criminal Investigation and the Los Angeles Police Department investigated this matter. 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.

          Assistant United States Attorneys Jennifer Chou and Sara Vargas of the Violent and Organized Crime Section are prosecuting this case.

          LOS ANGELES – A San Bernardino County woman was found guilty today of federal child exploitation charges, including that she obtained custody of an infant for the purpose of producing sexually explicit videos.

          Stefani Kasey Marie Stevens, 31, of Yucaipa, was found guilty of one count of obtaining custody of a minor with intent to produce child pornography, six counts of production of child pornography, one count of distribution of child pornography, and one count of possession of child pornography. United States District Judge Virginia A. Phillips issued the verdicts today after a four-day bench trial that ended last week.

          Judge Phillips scheduled an April 24, 2023 sentencing hearing, at which time Stevens will face a mandatory minimum sentence of 30 years in federal prison and a statutory maximum sentence of life imprisonment.

          According to evidence presented at the trial, between August 2019 and November 2019, law enforcement received information that three Kik online messaging application accounts associated with Stevens uploaded child sexual abuse material. Law enforcement also determined that a Google account associated with Stevens had uploaded seven sexually explicit images of the same victim, who was under the age of 12.

          In November 2019, federal agents executed a search warrant at Stevens’ home. During subsequent interviews, Stevens admitted to making sexually explicit videos of herself performing oral sex on the infant victim and that she took eight to 10 nude photographs with a second victim under the age of 12.

          Following the interviews, law enforcement accessed Stevens’ online accounts and learned that, the day before creating the sexually explicit videos of the infant in May 2019, Stevens and a like-minded user had online discussions about how Stevens was excited to take custody of the infant the next day so that she could create videos of herself engaging in sexual activity with the victim.

          Law enforcement also learned that, in addition to the sexually explicit videos of the infant created in May 2019, Stevens took sexually explicit photographs of the infant in June 2019 and of a second victim under the age of 12 in October and November 2018, all of which she stored in an online account, along with hundreds of other child pornography images and videos.

          Homeland Security Investigations and the San Bernardino County Sheriff’s Department investigated this matter.

          Assistant United States Attorneys Robert S. Trisotto and Sonah Lee of the Riverside Branch Office are prosecuting this case.

          LOS ANGELES – A Rhode Island man has pleaded guilty to federal criminal charges, admitting he defrauded investors out of more than $4.2 million in connection with the “Magic Mike Live” stage show in Las Vegas, the Justice Department announced today.

          John A. Santilli Jr., 48, of East Greenwich, Rhode Island, pleaded guilty late Thursday to one count of securities fraud and one count of wire fraud.

          According to his plea agreement, Santilli managed and partly owned Aloris Entertainment, LLC, which acquired an interest – through securities called “Class A Units” – in Mike’s Mobile Detailing, LLC, the company that operates the “Magic Mike Live” stage show, which is based on two “Magic Mike” movies that chronicle the life of a male stripper.

          From June 2016 to February 2020, Santilli raised funds from victims by soliciting investments in “Aloris Magic Mike LP,” a different business that he falsely told investors owned the Class A Units. Santilli lied to investors, telling them that, in return for their investment, they would receive “shares” in Aloris Magic Mike LP that corresponded to a particular number of Class A Units and entitled them to a percentage of the profits from “Magic Mike Live.” To bolster his false claims, Santilli used a doctored legal document that made it appear that Aloris Magic Mike LP was a shareholder of Mike’s Mobile Detailing.

          Santilli misappropriated a significant portion of his victims’ investments, including by withdrawing more than $1 million at casinos across the United States, where he used investors’ money for gambling. To raise more funds, Santilli falsely told his victims that new investment opportunities had arisen, resulting in Santilli selling shares in his businesses that corresponded to nearly double the number of Class A Units of Mike’s Mobile Detailing that his company actually owned.

          In total, Santilli caused approximately $4,258,679 in losses to his victims.

          United States District Judge Fernando M. Olguin scheduled an April 20 sentencing hearing, at which time Santilli will face a statutory maximum sentence of 40 years in federal prison.

          The FBI investigated this matter.

          Assistant United States Attorney Alexander B. Schwab of the Major Frauds Section is prosecuting this case.

          LOS ANGELES – United States Attorney Martin Estrada announced today that Assistant United States Attorney Thomas F. Rybarczyk will serve as District Election Officer for the Central District of California during the Justice Department’s nationwide Election Day Program for the upcoming November 8 general election.

          As District Election Officer, AUSA Rybarczyk will oversee the handling of complaints related to election fraud, voting rights concerns and threats of violence to election officials or staff occurring in the counties of Los Angeles, Orange, Riverside, San Bernardino, Ventura, Santa Barbara and San Luis Obispo. If complaints are received, he will coordinate with the FBI’s Field Office in Los Angeles to investigate them and will consult with the Department of Justice in Washington, D.C.

          “Every citizen must be able to vote without interference or discrimination and to have that vote counted in a free and fair election,” said United States Attorney Estrada. “Similarly, election officials and staff must be able to serve without being subject to unlawful threats of violence. The Department of Justice always will work tirelessly to protect the integrity of the election process.”

          The Department of Justice plays an important role in deterring and combating discrimination and intimidation at the polls, threats of violence directed at election officials and poll workers, and election fraud. The Department will address these violations wherever they occur. The Department’s longstanding Election Day Program furthers these goals and seeks to ensure public confidence in the electoral process by providing local points of contact within the Department for the public to report possible federal election law violations.

          Federal law protects against such crimes as threatening violence against election officials or staff, intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. The Voting Rights Act protects the right of voters to mark their own ballot or to be assisted by a person of their choice (where voters need assistance because of disability or inability to read or write in English).

          “The right to vote is the cornerstone of American democracy,” United States Attorney Estrada said. “We all must ensure that those who have the right to vote can exercise it if they choose, and that those who seek to corrupt it are brought to justice.”

          In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other voting rights abuses on election day. Agents at the FBI’s Los Angeles Field Office, which serves the same seven counties as the United States Attorney’s Office, can be reached by the public at (310) 477-6565.

          Complaints about possible violations of the federal voting rights laws can be made directly to the Civil Rights Division in Washington, D.C., by phone at (800) 253-3931 or via a complaint form that may be found at https://civilrights.justice.gov.

          Please note, however, in the case of a crime of violence or intimidation, please call 911 immediately and before contacting federal authorities. State and local police have primary jurisdiction over polling places, and almost always have faster reaction capacity in an emergency.

          LOS ANGELES – A West Los Angeles man who engaged in a harassment campaign targeting two female doctors at the West Los Angeles Veterans Affairs Medical Center, and two other female doctors working at the VA’s Loma Linda facility in San Bernardino County, was sentenced today to 216 months in federal prison.

          Gueorgui Hristov Pantchev, 51, was sentenced by United States District Judge John F. Walter, who said Pantchev “is a menace to society – a description that I don’t think I have ever used in describing a criminal defendant.”

          A federal jury on July 18 found Pantchev guilty of four counts of stalking. According to evidence presented at his five-day trial, Pantchev’s conduct with respect to two of the doctors began in 2011 with numerous threatening communications sent to West L.A. VA doctors identified in court documents as Victim C and Victim D. As a result of this harassment, Pantchev was charged by the Los Angeles County District Attorney’s Office and was convicted in 2014 of seven counts of stalking and witness intimidation.

          After serving a state prison sentence, Pantchev was paroled in 2017, and he was barred from the West L.A. VA Medical Center. Pantchev then began seeking medical services at the VA’s Loma Linda facility, where he started stalking, harassing, and intimidating Victims A and B.

          Notwithstanding the parole conditions that prohibited him from going to the West L.A. facility, Pantchev sought care there in 2020 and began sending harassing and intimidating communications to colleagues of Victims C and D.

          Pantchev deluged Victims C and D and their colleagues with hundreds of lewd, sexually explicit and defamatory fliers bearing large pictures of Victim C and Victim D. Pantchev repeatedly distributed these flyers around the West L.A. VA facility and numerous other locations in the Los Angeles area.

          “This defendant earned a lengthy prison sentence by terrorizing his victims for years,” said United States Attorney Martin Estrada. “The women subjected to his attacks suffered severe emotional distress, including constant fear for their physical safety and the safety of their families. Protecting victims is critical to the mission of our office, and I hope today’s sentencing brings them a sense of justice and security.”

          On the morning of Pantchev’s arrest in January 2021, he drove to Victim D’s home and her child’s elementary school and distributed more sexually explicit flyers that included the victim’s home address and contact information. During a search of Pantchev’s residence, law enforcement found more copies of the same flyers, along with printed copies of some of the letters and emails Pantchev sent to victims.

          Prosecutors wrote in court documents filed in relation to the sentencing that Pantchev’s “conduct was manifestly harmful and specifically designed to terrorize the victims and their families.”

          Pantchev has been in federal custody since his arrest in January 2021.

          During today’s sentencing hearing, Judge Walter said Pantchev’s “extreme anti-social behavior puts him in the top five to 10 defendants among the thousands that I have seen in over 20 years on the bench.”

          The FBI and the United States Department of Veterans Affairs investigated this matter.

          Assistant United States Attorneys Khaldoun Shobaki and Lauren Restrepo of the Cyber and Intellectual Property Crimes Section prosecuted this case.

          LOS ANGELES – A South Bay man, who along with his sister and other co-conspirators participated in a $6 million real estate scam that listed homes for sale without owners’ consent and collected money from multiple would-be buyers, was sentenced today to 108 months in federal prison.

          Adolfo Schoneke, 45, of Torrance, who pleaded guilty in May to one count of conspiracy to commit wire fraud, was sentenced by United States District Judge R. Gary Klausner. A restitution hearing was scheduled for December 12.

          Schoneke’s sister, Bianca Gonzalez, 39, pleaded guilty in April, admitting her role in the wire fraud scheme, and is scheduled to be sentenced on May 22, 2023.

          Schoneke and his sister, along with co-conspirators, operated real estate and escrow companies based in Cerritos, La Palma and Long Beach under a variety of names, including MCR and West Coast Realty Services. Schoneke and the other members of the conspiracy located properties to list for sale – even though they did not intend to sell the properties to anyone, and in many instances the properties were not for sale at all.

          The properties were listed on real estate websites such as the Multiple Listing Service (MLS) and were marketed as short sale opportunities. In some cases, the homes were marketed through open houses arranged by tricking homeowners or occupants into allowing their homes to be used.

          “The fraud scheme [Schoneke] invented, proposed to his co-conspirators, and carried out involved uniquely devious means designed to steal money from as many victims as possible,” according to a sentencing memorandum filed by prosecutors. “Playing on the dream of home ownership and seemingly out of reach home prices, [Schoneke] figured out a way to ‘sell’ homes that he did not own and had no business in listing for sale.”

          Multiple offers were accepted for each of the not-for-sale properties, but the co-conspirators hid this fact from the victims and instead led victims to believe their offer was the only one accepted. The co-conspirators strung victims along – sometimes for years – by telling them closings were being delayed because lenders needed to approve the purported short sales.

          Office workers opened bank accounts to hide the co-conspirators’ involvement in the fraud. Those accounts were used to receive down payments on the homes and other payments from victims who were convinced to transfer the full “purchase price” after receiving forged short sale approval letters. The co-conspirators directed the office workers to withdraw large amounts of cash from these accounts, which made the proceeds harder to trace.

          Schoneke “and his co-conspirators used numerous properties to further the fraudulent scheme, and collected more than $11.7 million from victims as part of the scheme (involving more than 860 transfers from approximately 750 or more victims),” according to the sentencing memo. “Although some of the victims were paid back, the scheme caused more than $6 million in losses to nearly 400 victims.”

          In a related case, Mario Gonzalez (no relation to Bianca Gonzalez), 51, of Garden Grove, pleaded guilty in 2019 to conspiracy to commit wire fraud and is scheduled to be sentenced on April 3, 2023.

          The FBI and the Federal Deposit Insurance Corporation, Office of Inspector General investigated this matter. The investigation was initiated by numerous complaints to the Long Beach Police Department and the Los Angeles County Sheriff’s Department, both of which provided substantial assistance during the federal investigation.

          Assistant United States Attorney Kerry L. Quinn of the Major Frauds Section is prosecuting this case.

          LOS ANGELES – A South Bay man was sentenced today to life without parole in federal prison after he admitted to producing thousands of sexually explicit images and videos of nearly three dozen children, one of whom was exploited over the course of at least two years and performed sex acts online in exchange for money. 

          Billy Edward Frederick, 52, of Redondo Beach, was sentenced by United States District Judge Dale S. Fischer, who said that “to say his conduct is despicable is an understatement.”

          Judge Fischer added that “life in prison adequately reflects the seriousness of the offense” in which Frederick “targeted” victims in a “part of the world where children are known for being sexually exploited.”

          Frederick pleaded guilty in September 2021 to two felony offenses: production of child pornography for transportation into the United States and enticement of a minor to engage in criminal sexual activity.

          According to court documents, Frederick obtained and stored in his Google accounts various images and videos depicting child sex abuse material. In messages sent to Frederick, several victims call Frederick “master.” Prosecutors said in a sentencing memorandum that Frederick exploited “young boys in the Philippines in need of money for food and school.”

          Frederick admitted to producing more than 5,000 images and videos of child pornography involving at least 35 different children by requesting these children engage in specified sexually explicit activity in exchange for money. Some of the videos and images depicted minor victims under the age of 12 being used for sexual acts.

          “Using Google chat to bridge their geographical divide, [Frederick], while living in Los Angeles County, exploited numerous boys who lived in the Philippines,” according to the sentencing memorandum. Frederick’s “years-long conversations with these Philippine boys were not coded; they were explicit and lurid – brimming with details regarding what defendant liked, demanded, and expected from his victims, should they wish to be paid.”

          In addition to the life sentence, Judge Fischer ordered Frederick to pay $5,000 to the Justice for Victims of Trafficking Act of 2015; $5,000 to the Amy, Vicky, and Andy Child Pornography Victim Assistance Act of 2018, and $8,000 in restitution to one of the victims.

          Homeland Security Investigations investigated this matter.

          Assistant United States Attorney Kathy Yu of the Violent and Organized Crime Section prosecuted this case.

          LOS ANGELES – Two men were arrested this morning on federal robbery and firearms offenses that allege they robbed an armored car on Monday and shot a guard several times in the leg.

          Gregory James, 47, of San Pedro, and Lamond Akins, 30, of Compton, were arrested pursuant to a federal criminal complaint that charges them with Hobbs Act robbery and discharging a firearm in furtherance of a crime of violence. Both men are expected to make their initial court appearance this afternoon in United States District Court in downtown Los Angeles.

          On Monday morning at approximately 11:20, a Loomis guard was ambushed by two armed suspects after working on ATMs at a Bank of America branch in Harbor City. According to the affidavit in support of the criminal complaint, surveillance video from the scene and from James’ residence link the two defendants to the robbery.

          Furthermore, “Akins is also the registered owner of a black Chevy Malibu, which is consistent with the vehicle used during the robbery,” the affidavit states. “Cell phone records for James’s cell phone place him in the location of the October 17, 2022, robbery at the time of the robbery.”

          During the incident, the robbers ambushed the guard and both opened fire, striking him in the leg several times. According to the affidavit, the robbers stole $140,000, as well as the guard’s firearm.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          The Hobbs Act robbery offense alleged in the complaint carries a statutory maximum penalty of 20 years in federal prison, and the firearms offense carries a mandatory minimum sentence of 10 years in prison

          The Los Angeles County Sheriff’s Department and the FBI are conducting the investigation in this matter. The Gardena Police Department provided substantial assistance.

          Assistant United States Attorney Jeffrey M. Chemerinsky of the Violent and Organized Crime Section is prosecuting this case.

          LOS ANGELES – A Canadian man was sentenced today to 174 months in federal prison for leading a drug-trafficking organization that intended to ship hundreds of pounds of cocaine and heroin from Southern California into Canada – and import MDMA (ecstasy) into the United States – using big-rig trucks and encrypted telephones to achieve their aims.

          Vincent Yen Tek Chiu, 44, of Vancouver, Canada, was sentenced by United States District Judge John A. Kronstadt.

          A federal jury found Chiu guilty in March of one count of conspiracy to distribute controlled substances, one count of conspiracy to export controlled substances, one count of distribution of cocaine, one count of distribution of heroin, and one count of distribution of MDMA.

          Chiu – the lead defendant in this criminal case, who was known by a number of monikers including “El Chino,” “Tiger,” “TigerOfMexico,” “TigerOfSweden” and “ControllerCard” – and other members of the drug trafficking organization obtained multi-kilogram quantities of cocaine, and sometimes heroin, in Los Angeles and passed the narcotics to couriers who intended to transport them to Canada for further distribution. Big-rig trucks were used in attempts to export some of the cocaine into Canada.

          Chiu arranged the purchase of bulk quantities of cocaine in the United States for importation into Canada in exchange for cash or bulk quantities of MDMA. Chiu also arranged for the transportation of MDMA from Canada into the United States in exchange for cocaine. Chiu and his co-conspirators used modified cellular devices with military-grade, end-to-end encryption to talk to each other about the drug buys and transportation of narcotics.

          At today’s sentencing hearing, the court determined that Chiu was involved in distributing 77 kilograms (169.7 pounds) of cocaine, 8 kilograms of heroin, and 24 kilograms of MDMA, which prosecutors presented evidence at trial had a wholesale value of more than $3 million. 

          Federal agents intercepted several of the drug deliveries in 2018 and 2019. Law enforcement seized more than $800,000 in Canadian currency during this investigation.

          “[Chiu] controlled every aspect of his lucrative and high-volume business: setting up the wholesale drug purchases and dictating the terms and price; managing the financials, including sending invoices for the product and orchestrating the money dropoffs; directing others to conduct quality testing of the product to ensure that it was ‘high heat,’ which was the type of cocaine he demanded; and arranging long-haul semi-trucks to transport the drug loads across the United States and into Canada,” prosecutors wrote in a sentencing memorandum.

          Other members of this drug trafficking conspiracy have received prison sentences, including Anthony Louis Lam, 37, of Vancouver, Canada, who is now serving four years in federal prison; Henry Liu, 33, of Rosemead, who is serving a 10-year prison sentence; Christian Raul Gastelum-Sanchez, 27, of Los Angeles, who is now serving five years in federal prison; Raul Arturo Gastelum-Benitez, 54, of Los Angeles, who is now serving four years in federal prison; and Khonsavanh Vorachack, 62, of Sacramento, California, who now serving three years in federal prison. Each defendant pleaded guilty to one count of conspiracy to distribute controlled substances.

          The FBI, Homeland Security Investigations, and the Royal Canadian Mounted Police investigated this matter. Critical support was provided by the U.S. Drug Enforcement Administration, the California Highway Patrol, and the West Covina Police Department.

          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.

          Assistant United States Attorneys Brittney M. Harris and MiRi Song of the International Narcotics, Money Laundering, and Racketeering Section prosecuted this case.

          LOS ANGELES – The former chairman and CEO of Beverly Hills-based Aviron Pictures was sentenced today to 41 months in federal prison for applying for and receiving $1.7 million in loans under the Paycheck Protection Program (PPP) for Aviron entities when the entire operation was being shuttered because of his embezzlement.

          William Sadleir, 68, of Beverly Hills, was sentenced by United States District Judge Dolly M. Gee, who also ordered him to pay $282,566 in restitution.

          Sadleir pleaded guilty on March 16 to one count of bank fraud and one count of money laundering.

          In April 2020, Sadleir – who had been terminated from Aviron Pictures four months earlier after a major company investor discovered he had embezzled company funds – filed bank loan applications that fraudulently sought more than $1.7 million dollars in forgivable PPP loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Sadleir obtained the loans for three Aviron entities by falsely representing that the funds would be used to support payroll expenses for 33 employees at each company, when in fact the entities were no longer operational.

          Within days of the loans being funded on May 1, 2020, Sadleir transferred nearly $1 million to his personal checking account.

          Sadleir spent most of the fraudulently obtained loan proceeds on utility bills, mortgage expenses, and his personal lawyer. He did not use any of the fraudulent loan proceeds to pay employees of the Aviron companies.

          Following the discovery of the fraudulent loan applications, federal agents seized $308,058 of fraudulent loan proceeds from an Aviron account, and Sadleir returned $1,122,090 to the bank that funded the loans. As a result of the fraudulent PPP loan scheme, the SBA suffered losses of $282,566.

          On September 9, Sadleir was sentenced in the Southern District of New York to https://www.justice.gov/usao-sdny/pr/hollywood-executive-and-former-white-house-staffer-sentenced-six-years-prison 72 months in federal prison after pleading guilty to two wire fraud counts for misappropriating more than $25 million that had been invested in Aviron. Judge Gee today ordered that the sentence imposed in the Los Angeles will run concurrent to the six-year sentence in the New York case.

          The FBI, the SBA’s Office of Inspector General, and the Federal Deposit Insurance Corporation’s Office of Inspector General investigated the Los Angeles matter.

          Assistant United States Attorney Gregory Bernstein of the Major Frauds Section prosecuted this case.

          In May 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 Justice 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.

          LOS ANGELES – The captain of the P/V Conception – a Santa Barbara-based dive boat that caught fire near Santa Cruz Island in 2019, resulting in the deaths of 33 passengers and one crew member – was indicted today by a federal grand jury on a charge of misconduct or neglect of ship officer.

          The one-count indictment naming Jerry Nehl Boylan, 68, of Santa Barbara, alleges a series of failures and the abandoning of his ship, which constituted “misconduct, gross negligence, and inattention to his duties” and led to the deaths of 34 victims.

          The new indictment reinstates the charge against Boylan after a federal judge last month dismissed a previous indictment charging Boylan with the same offense because it did not allege gross negligence.

          The charge of misconduct or neglect of ship officer contained in the new indictment alleges that Boylan – who “was responsible for the safety and security of the vessel, its crew, and its passengers” – failed his responsibilities in several ways, including by:

• failing to have a night watch or roving patrol;
• failing to conduct sufficient fire drills and crew training;
• failing to provide firefighting instructions or directions to crewmembers after the fire started;
• failing to use firefighting equipment, including a fire ax and fire extinguisher that were next to him in the wheelhouse, to fight the fire or attempt to rescue trapped passengers;
• failing to “to perform any lifesaving or firefighting activities whatsoever at the time of the fire, even though he was uninjured”;
• failing to use the boat’s public address system to warn passengers and crewmembers about the fire; and
• becoming the first crewmember to abandon ship “even though 33 passengers and one crewmember were still alive and trapped below deck in the vessel’s bunkroom and in need of assistance to escape.”

          The Conception was a 75-foot, wood-and-fiberglass passenger vessel that docked in Santa Barbara Harbor. During a Labor Day weekend dive trip in 2019, the boat carried 33 passengers and six crew members, including Boylan. During the early morning hours of September 2, 2019, a fire broke out while the boat was anchored in Platt’s Harbor near Santa Cruz Island. The fire, which engulfed the boat and led to its sinking, resulted in the deaths of 34 people who had been sleeping below deck. Five crewmembers, including Boylan, were able to escape and survived.

          Boylan will be directed to appear in the coming weeks in United States District Court for an arraignment on the new indictment.

          The charge of misconduct or neglect of ship officer carries a statutory maximum penalty of 10 years in federal prison.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          The FBI; the Coast Guard Investigative Service; and the Bureau of Alcohol, Tobacco, Firearms and Explosives are investigating this matter.

          Assistant United States Attorneys Mark A. Williams, chief of the Environmental and Community Safety Crimes Section; Matthew W. O’Brien of the Environmental and Community Safety Crimes Section; and Brian R. Faerstein of the Public Corruption and Civil Rights Section are prosecuting this case.

          LOS ANGELES – An Orange County man pleaded guilty today to federal criminal charges for defrauding 19 victims – some of whom he developed romantic relationships with – and then laundering the proceeds of his scheme.

          Ze’Shawn Stanley Campbell, 35, of Irvine, pleaded guilty to one count of wire fraud and one count of money laundering.

          According to his plea agreement, from April 2014 to April 2020, Campbell convinced his victims that he was reliable by befriending them and starting romantic relationships with them. To enhance his purported creditworthiness in their eyes, he told them lies, such as falsely saying that he had millions of dollars and operated successful businesses, including McDonald’s franchises, a security company and a chain of gyms in Texas. Campbell also boosted his stature with the victims by falsely telling them he was a successful investor in real estate and Bitcoin, as well as claiming he had served as a Navy SEAL in the Iraq and Afghanistan wars.

          Having convinced his victims of his bona fides, Campbell induced them to provide money and property to him, claiming that he would use the victims’ money and property to support his businesses, fund investments made on the victims’ behalf and pay his purported medical bills. Rather than use the victims’ money as he promised, however, Campbell used it to pay personal expenses and to buy luxury items for himself.

          For example, in December 2017, one victim wrote Campbell a check for $61,452, which Campbell deposited via interstate wires into a Wells Fargo bank account he controlled. Campbell promised the victim that the money would be used for an investment in Bitcoin on the victim’s behalf. In fact, Campbell spent the money on himself, including by making payments on a BMW and a Mercedes-Benz that he had leased in a different victim’s name.

          In total, Campbell admitted to causing losses of at least $250,000 and up to $1.5 million to 19 different victims, including 10 individuals and nine companies.

          United States District Judge Mark C. Scarsi scheduled a January 9 sentencing hearing, at which time Campbell will face a statutory maximum sentence of 30 years in federal prison.

          The FBI investigated this matter.

          Assistant United States Attorney Ranee A. Katzenstein, Chief of the Major Frauds Section, is prosecuting this case.

A federal jury convicted a California woman last Friday, Oct. 14 for a health care fraud and prescription drug diversion scheme involving two Southern California pharmacies.

According to court documents and evidence presented at trial, Irina Sadovsky, 53, of Calabasas, the owner and pharmacist-in-charge of Five Star RX doing business as Five Star Pharmacy (Five Star Pharmacy) and Ultimate Pharmacy Inc. (Ultimate Pharmacy), engaged in a health care fraud and black market prescription drug diversion conspiracy that began in or around September 2016, and continued through in or around April 2017. Sadovsky submitted claims to Medicaid of California (Medi-Cal) and Medicare for prescription drugs that were never dispensed to beneficiaries but rather were provided to co-conspirators to sell on the black market. 

Sadovsky’s co-conspirators created fraudulent prescriptions, either by writing the prescriptions themselves or by paying kickbacks to marketers with access to patients and prescribers. Sadovsky recommended the combinations of prescription drugs to be written, checked the eligibility of the patients for reimbursement, and fraudulently submitted claims to Medi-Cal and Medicare.  

Sadovsky was convicted of conspiracy to commit health care fraud and conspiracy to engage in the unlicensed wholesale distribution of prescription drugs. She is scheduled to be sentenced on Feb. 3, 2023 and faces a maximum penalty of 10 years in prison for the health care fraud conspiracy, and five years in prison for the unlicensed distribution conspiracy. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Martin Estrada for the Central District of California; Assistant Director in Charge Donald Alway of the FBI Los Angeles Field Office; and Special Agent in Charge Timothy B. DeFrancesca of the Department of Health and Human Services, Office of Inspector General (HHS-OIG) made the announcement.

The FBI and HHS-OIG investigated the case, which was brought as part of the Los Angeles Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The California Department of Justice provided valuable assistance.

Assistant Chief Alexis Gregorian and Trial Attorneys Justin Givens and Alex Michael of the Criminal Division’s Fraud Section are prosecuting the case.

The Fraud Section leads the Criminal Division’s efforts to combat health care fraud through the Health Care Fraud Strike Force Program. Since March 2007, this program, comprised of 15 strike forces operating in 24 federal districts, has charged more than 4,200 defendants who collectively have billed the Medicare program for more than $19 billion. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with the Office of the Inspector General for the Department of Health and Human Services, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at https://www.justice.gov/criminal-fraud/health-care-fraud-unit.

          LOS ANGELES – A San Fernando Valley woman was sentenced today to 72 months for conspiring to defraud health insurance companies by causing millions of dollars in fraudulent claims to be submitted to provide patients with “free” cosmetic procedures, including Botox injections, and for cheating on her taxes.

          Roshanak Khadem, 55, a.k.a. “Roxanne Khadem,” a.k.a. “Roxy Khadem,” of Sherman Oaks, was sentenced by United States District Judge Stephen V. Wilson, who also ordered her to pay $1,250,601 in restitution and a $30,000 fine.

          Khadem pleaded guilty on February 8 to one count of conspiracy to commit health care fraud and one count of subscribing to a false income tax return.

          Khadem owned and operated facilities that provided aesthetic services to clients, including R&R Med Spa in Valley Village and Nu-Me Aesthetic and Anti-Aging Center in Woodland Hills.

          From January 2012 to April 2016, Khadem caused patients to visit her clinics to receive cosmetic procedures, including Botox injections, facials and laser hair removal. Khadem knew these procedures were not covered by the patients’ health insurers. Khadem also knew that her employees informed some patients that, if they turned over their health insurance information to the Khadem-owned clinics, the patients could receive free or discounted cosmetic procedures pursuant to a “credit” they would earn.

          Health insurance information from these patients was provided to the insurance biller for the clinics, knowing and intending that the information would be used to submit false and fraudulent claims to the health insurers for medical procedures that Khadem knew were either not actually provided to the patients or were not medically necessary.

          Then, based on the amount that the health insurers paid on those false and fraudulent claims, Khadem and others would calculate an amount, which the co-conspirators referred to as a "credit," that the patients could use to receive free or discounted cosmetic procedures from the clinics. Those patients would then come into the clinics to receive the free or discounted cosmetic procedures.

          The proceeds from the health care fraud conspiracy were deposited into bank accounts that were held in the names of doctors who were affiliated with the clinics and who signed off on and caused to be submitted the false and fraudulent claims under their names.

          Khadem took possession of the proceeds from the doctors’ accounts in two ways. First, because Khadem had signatory authority on the bank accounts, she was able to obtain the funds by writing checks on the accounts. Second, she would withdraw funds from the bank accounts using pre-signed checks that she obtained from the doctors.

          From January 2012 to April 2016, Khadem and her co-conspirators submitted claims, which included false and fraudulent claims for which those companies paid out at least $1,250,601.

          The scheme involving the two clinics defrauded the International Longshore and Warehouse Union, Pacific Maritime Association Benefit Plan, which is the health benefit plan that covers longshore workers in Southern California and their dependents. Another victim was the Federal Employees Health Benefits Program, which provides health insurance for federal employees.

          Khadem failed to report this income on her income tax returns for 2013, 2014 and 2015. Khadem’s underreporting of her income for these three years caused a total tax loss of $453,451.

          The remaining four defendants in this case each have pleaded guilty. Lucine Ilangezyan, 42, of North Hills, pleaded guilty to one count of conspiracy to commit health fraud, and is serving an 18-month prison sentence. Gary Jizmejian, 48, of Santa Clarita, a former senior investigator at the Anthem Special Investigations Unit, the anti-fraud unit within Anthem that is responsible for investigating health care fraud committed against the insurance company, pleaded guilty to using his cell phone to send text messages to co-defendants as part of this commercial bribery scheme. He also is serving an 18-month prison sentence.

          Dr. Roberto Mariano, 64, of Rancho Cucamonga, a physician who helped operate the clinics, and Marina Sarkisyan, 53, of Panorama City, who was the office manager at the clinics, are scheduled to be sentenced on November 7.

          IRS Criminal Investigation, the United States Secret Service, and the United States Department of Labor – Employee Benefits Security Administration investigated this matter.

          Assistant United States Attorneys Valerie L. Makarewicz of the Major Frauds Section and Morgan J. Cohen of the General Crimes Section prosecuted this case.

          LOS ANGELES – A San Fernando Valley man has been sentenced to 120 months in federal prison for acting as an unlicensed gun broker by selling 16 rifles and handguns – many without serial numbers – as well as various firearms accessories over a seven-week period, and for selling nearly one pound of methamphetamine, the Justice Department announced today.

          Arthur Muradyan, 33, of North Hollywood, was sentenced Thursday afternoon by United States District Judge Fernando M. Olguin.

          Muradyan pleaded guilty on May 5 to one count of engaging in the business of dealing in firearms without a license and one count of distribution of methamphetamine.

          In August 2021 and September 2021, Muradyan sold firearms, firearms accessories and ammunition to an informant working with federal law enforcement. The items sold included machine guns, semi-automatic firearms with large capacity magazines, firearms bearing no legitimate manufacturer’s mark or serial number – commonly referred to as “ghost guns” – and unregistered and unserialized short-barreled rifles.

          Muradyan also sold 423.7 grams of methamphetamine to the informant on September 8, 2021, the same day he also sold a semi-automatic 9mm handgun and a machinegun conversion device commonly called a “Glock switch.”

          During the final gun sale on September 29, 2021, Muradyan sold an unserialized, short-barreled AR-15-type rifle with a 3D printed machinegun conversion device attached to it, another AR-15-type rifle with an obliterated serial number, a semi-automatic 9mm handgun, and another 9mm pistol with no serial number. On this date, authorities searched his residence and recovered another 23 firearms, magazines, ammunition of various calibers, and firearms component parts and accessories. Muradyan illegally possessed those seized firearms and ammunition because he previously had been convicted of felony burglary offenses in two cases.

          This case is the result of an investigation by the Los Angeles Firearms Trafficking Strike Force, which is spearheaded by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the United States Attorney’s Office. The Los Angeles Police Department provided substantial assistance in the investigation.

          Assistant United States Attorney Gregg E. Marmaro of the International Narcotics, Money Laundering, and Racketeering Section prosecuted this matter.

          LOS ANGELES – A high-ranking member of the Oxnard-based Surtown Chiques street gang was sentenced today to 162 months in federal prison for attempting to secure control of drug trafficking in Ventura County and extorting “taxes” on behalf of the Mexican Mafia prison gang.

          Armando “Criminal” Molina, 39, of Ventura, was sentenced by United States District Judge John A. Kronstadt.

          At the conclusion of a four-day trial in September 2019, a federal jury found Molina guilty of one count of conspiracy to distribute methamphetamine and five counts of distribution of methamphetamine.

          Molina was arrested in November 2013 as part of Operation “SuperNova,” a multi-agency task force investigation that targeted Mexican Mafia-affiliated street gangs in Ventura County.

          The federal criminal complaint on which Molina was arrested targeting “shotcallers” of Ventura County street gangs. The criminal complaint details a year-long undercover investigation and outlines a series of narcotics transactions that led to the seizure of more than two pounds of methamphetamine and quantities of heroin that were being sold on the streets of Ventura County.

          The drugs were supplied by a drug trafficking organization controlled by Mexican Mafia member Martin Madrigal-Cazares. Local street gangs communicated with the head of the organization in Mexico, while controlling narcotics sales and collecting “taxes” on behalf of the Mexican Mafia in Ventura County.

          From October 2012 and March 2013, Molina and his co-conspirators sold approximately 267 grams of pure methamphetamine to a confidential informant working for an FBI task force.

          “[Molina] was more than some street dealer doling out methamphetamine to addicts to make a buck,” prosecutors argued in a sentencing memorandum. “Rather, he was a key member in a broader, more dangerous criminal enterprise that sought to dominate profitable criminal conduct over the Ventura County region.”

          On the eve of Molina’s trial in 2019, a co-defendant, Frank Joshua “Villain” Ruiz, 40, of Ventura County, pleaded guilty to one count of conspiracy to distribute methamphetamine. In February 2020, Judge Kronstadt sentenced Ruiz to 135 months in federal prison.

          The investigation was conducted jointly by the FBI, the Ventura Police Department, and the Oxnard Police Department. The Ventura County-Multi-Agency Gang Task Force is one of many FBI Safe Streets Task Forces throughout the United States, funded for the purpose of assisting local police in identifying and addressing violent crime in America.

          Assistant United States Attorney Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section, prosecuted this case.

          RIVERSIDE, California – A Michigan man appeared in court today after being arrested on a federal criminal complaint alleging he deliberately set 25 fires on trailers belonging to a major commercial trucking company in eight different states over a span of more than two years.

          Viorel Pricop, 64, of Allen Park, Michigan, was arrested Tuesday morning and made his initial appearance today in United States District Court in Detroit, where a detention hearing is scheduled for tomorrow.

          Pricop is charged with one count of arson of property in interstate commerce, a crime that carries a mandatory minimum sentence of five years in federal prison and a statutory maximum of 20 years in federal prison.

          According to an affidavit filed with the complaint, 25 semi-truck trailers owned by Swift Transportation, a Phoenix-based commercial trucking company, were set ablaze from June 2020 to September 2022. In each of the incidents, the Swift-owned truck was parked or stopped at a fuel station or rest area when a fire occurred in or on the trailer portion of the vehicle, mainly on or near the trailer tires.

          These incidents occurred at locations spanning from Barstow, California to McCalla, Alabama, with most incidents occurring along Interstate 10 and Interstate 40. Law enforcement has learned of six fires in California, three fires in Arizona, nine fires in New Mexico, three fires in Texas, and one fire each in Oklahoma, Louisiana, Arkansas and Alabama.

          Swift hired fire investigation consultants to assist with fire scene examinations. A pattern also began to develop when multiple reports noted substantially similar methods of lighting the trailers on fire, including where on the vehicles the fires began, and the fact the fires occurred late at night.

          An investigation of cell phone towers near the fires revealed that a specific GPS navigation device installed in a commercial truck was present at the fires. Law enforcement determined that this device was installed on a vehicle owned and operated by Pricop, the affidavit states. Law enforcement then identified the cellphone subscribed to Pricop and, through historical cellular data analysis and ping warrants, learned that the phone was present in the general area of 24 of the 25 fires, the affidavit alleges.

          On September 16, search warrants were executed on Pricop’s vehicle and residence, yielding additional evidence on his alleged involvement in this series of arsons. Numerous logbooks, bills of lading, shipping receipts, and other record keeping documents were obtained in both paper and digital form from Pricop’s vehicles and residence. Many of these documents were found to contain location information, such as cargo pickup and delivery dates, which coincided with locations where fires in this series occurred, according to the affidavit.

          Further record checks for Pricop revealed that he was convicted in 2018 in the Eastern District of Michigan for transportation of stolen goods. Swift cooperated in the investigation and prosecution of that case. Pricop was sentenced to two years’ imprisonment and was given credit for time served. His term of supervised release ended in June 2019, about one year before the arsons in this case began, the affidavit states.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          The Bureau of Alcohol, Tobacco, Firearms and Explosives is investigating this matter.

          Assistant United States Attorney John A. Balla of the Riverside Branch Office is prosecuting this case.

          LOS ANGELES – Salvador Huizar – the brother of former Los Angeles City Councilman José Huizar, who faces federal racketeering charges stemming from a “pay-to-play” scheme – admitted in a plea agreement filed today in United States District Court that he took cash from José Huizar on numerous occasions and immediately wrote checks back to him or arranged to pay his expenses, and then lied about his actions to federal investigators.

          Salvador Huizar, 57, of Boyle Heights, agreed to plead guilty to one felony count of making false statements to federal investigators, acknowledging that he repeatedly lied about accepting cash from his brother, including to a federal grand jury and most recently two weeks ago during an interview with FBI agents and federal prosecutors.

          “Between at least November 26, 2013, and August 22, 2018, upon José Huizar’s request, [Salvador Huizar] accepted envelopes of cash from José Huizar on at least 20 occasions,” Salvador Huizar admitted in the plea agreement. “In exchange, [Salvador Huizar] contemporaneously wrote checks, or facilitated electronic payments from [his] own bank account, to either José Huizar directly or to pay José Huizar’s expenses in the same amounts as the cash provided by José Huizar.”

          Even though Salvador Huizar asked his brother on multiple occasions about the cash, José Huizar said “it was better that [Salvador Huizar] did not know the source of the cash,” according to the plea agreement.

          Salvador Huizar admitted he lied to FBI agents on November 17, 2018, when he falsely stated that José Huizar never asked him to write any checks, except on two occasions and for which he was not paid back. However, on at least 20 occasions, José Huizar gave his brother an envelope of cash and asked him to write checks or facilitate electronic payments to José Huizar or for his expenses, the plea agreement states.

          Salvador Huizar also admitted he made false statements to the FBI and federal prosecutors on January 30, 2020 – when he said cash from his brother was to pay off a debt or that he received cash later, after the check was written – and two weeks ago when he reiterated these false statements before recanting and saying José Huizar regularly had cash with him and gave Salvador Huizar cash at the time he wrote the checks.

          During an appearance before a federal grand jury on March 5, 2020, Salvador Huizar also made false statements when he testified under oath that cash from José Huizar was to pay off a debt and that cash was received only after Salvador Huizar wrote a check to his brother.

          As part of his plea agreement, Salvador Huizar has agreed to cooperate with the government’s ongoing investigation and has agreed to testify at the next two trials in this case.

          Salvador Huizar is expected to formally enter his guilty plea before a federal judge in the coming weeks. The charge of making a false statement to a federal agency carries a statutory maximum sentence of five years in federal prison.

          Assistant United States Attorneys Mack E. Jenkins, Chief of the Public Corruption and Civil Rights Section; Susan S. Har and J. Jamari Buxton of the Public Corruption and Civil Rights Section; and Patrick A. Castañeda of the International Narcotics, Money Laundering, and Racketeering Section are prosecuting the case against Salvador Huizar.

          José Huizar and former Los Angeles Deputy Mayor Raymond Chan are scheduled to go to trial on February 21, 2023, on federal charges alleging they conspired to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act. Huizar allegedly agreed to accept at least $1.5 million in illicit financial benefits and faces dozens of additional federal criminal charges.

          Previously in this racketeering case, real estate developer Dae Yong Lee and one of his companies were convicted in June of federal criminal charges for providing $500,000 in cash to José Huizar and his special assistant in exchange for their help in resolving a labor organization’s appeal of their downtown Los Angeles development project and obstructing justice by falsifying financial documents.

          The next scheduled trial in this case is scheduled to begin October 25. Shen Zhen New World I LLC, an entity owned by real estate developer Wei Huang, is charged with bribing Huizar related to another downtown Los Angeles development project. Huang remains a fugitive.

          Any member of the public who has information related to this or any other public corruption matter in the City of Los Angeles is encouraged to send information to the FBI’s tip line at tips.fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.

          LOS ANGELES – A Santa Barbara man was sentenced today to 133 months in federal prison for stealing approximately $14 million from victims who thought their investments would be used to purchase annuities issued by Swiss insurance companies and for failing to pay over $3 million in federal income tax.

          Darrell Arnold Aviss, 64, was sentenced by United States District Judge Stanley Blumenfeld Jr., who also ordered him to pay $ 14,486,169 in restitution and to forfeit his interest in a Santa Barbara home worth approximately $4 million.

          At today’s court hearing, Judge Blumenfeld, who remanded Aviss into federal custody, described Aviss as “cruel, callous and self-absorbed” and adding, “the devastation in this case is real.”

          On June 28, Aviss pleaded guilty to 21 felonies: five counts of wire fraud, one count of money laundering, five counts of engaging in monetary transactions in criminally derived property over $10,000, three counts of tax evasion, six counts of willful failure to report foreign bank and financial accounts, and one count of aggravated identity theft.

          Aviss ran his Ponzi scheme from at least 2012 through the summer of 2020, soliciting money from people who wanted to purchase annuities from insurance companies based in Switzerland. Aviss claimed the Swiss annuities he offered were safe and secure, and, in some instances, he told victims the annuities would pay interest rates ranging from 5% to 7%.

          But Aviss did not use the victims’ money to purchase annuities, even though he arranged for the victims to receive fabricated statements showing the purported value of the annuities, which the false documents showed were increasing over time.

          Victims, most of whom were over the age of 60, gave Aviss more than $14 million, with most of that money coming from just one victim. Some money was paid back to victims to keep the scheme running.

          Instead of purchasing annuities, Aviss used the victims’ money for his own purposes and to support his lavish lifestyle. He used the money for, among other things, Ponzi payments to victims, mortgage payments, luxury car leases, expensive watches, trips to Monaco, more than $170,000 in purchases at a Santa Barbara nightclub, and 20 tickets to a U2 concert and after-party.

          One victim lost more than $9.7 million in Aviss’ Ponzi scheme. Aviss stole $400,000 from another victim whom he knew recently had been diagnosed with cancer, according to the prosecution’s sentencing memorandum.

          “Aviss has essentially been living a life of pure crime for about a decade,” prosecutors wrote in a sentencing memorandum. “Based on the financial records and his statements to the probation officer, Aviss has had no source of money – no real job – since at least 2012, apart from the money he stole from the victims, including retirees who denied themselves luxuries to save up the nest eggs Aviss stole.”

          Aviss also defrauded the United States by failing to file tax returns for 2014, 2015 and 2016 and failing to pay any income taxes for those years. Aviss evaded paying more than $3 million in income taxes.

          Aviss also failed to file with the Department of the Treasury Reports of Foreign Bank and Financial Accounts for the years 2015 through 2020 in an attempt to conceal accounts he controlled in Monaco, where he deposited some of his ill-gotten gains. He transferred victims’ money to these offshore accounts, one of which was established with information from an identity theft victim.

          The FBI and IRS Criminal Investigation conducted the investigation in this matter.

          Assistant United States Attorneys Monica E. Tait and Ali Moghaddas of the Major Frauds Section prosecuted this case. Assistant United States Attorney Daniel G. Boyle of the Asset Forfeiture and Recovery Section is handling asset forfeiture matters in this case.

          If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This Department of Justice hotline, managed by the Office for Victims of Crime, is staffed by experienced professionals who provide personalized support to callers by assessing the needs of the victim and identifying relevant next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting, connect callers directly with appropriate agencies, and provide resources and referrals, on a case-by-case basis. Reporting is the first step. Reporting can help authorities identify those who commit fraud, and reporting certain financial losses due to fraud as soon as possible can increase the likelihood of recovering losses. The hotline is staffed seven days a week from 3 a.m. to 8 p.m. PT. English, Spanish, and other languages are available.

          Information about the Department of Justice’s Elder Fraud Initiative is available at www.justice.gov/elderjustice.

          LOS ANGELES – An Orange County physician pleaded guilty today to a federal criminal charge for conspiring to illegally prescribe more than 120,000 opioid pills to 18 different people over a six-year span without a legitimate medical purpose in exchange for cash and insurance payments.

          Dr. Dzung Ahn Pham, 61, of Tustin, pleaded guilty to one count of conspiracy to distribute controlled substances, a crime that carries a statutory maximum sentence of 20 years in federal prison.

          According to his plea agreement, Pham, who owned Irvine Village Urgent Care, conspired with Jennifer Thaoyen Nguyen, 51, of Irvine, to illegally distribute controlled substances.

          Nguyen, a licensed pharmacist who operated the Irvine-based Bristol Pharmacy, has agreed to plead guilty to one count of conspiracy to distribute controlled substances. She is scheduled to enter her guilty plea to the felony charge on October 14.

          Pham admitted in his plea agreement that from January 2013 to December 2018, he wrote prescriptions for approximately 53,693 oxycodone pills, approximately 68,795 hydrocodone pills, and approximately 29,286 pills of amphetamine salts. The prescriptions were filled using 18 different patient names. Pham admitted that he acted with the intent to distribute the drugs outside the course of professional practice and without a legitimate medical purpose.

          On four occasions in November and December of 2017, Pham wrote prescriptions for a patient – identified in court papers as “S.C.” – whom he knew was a drug addict for a total of 704 pills of 30 mg of oxycodone. On two occasions in August 2018, Pham wrote prescriptions in the name of S.C.’s wife, who was not Pham’s patient, never saw Pham for any medical appointment, and was not aware Pham was issuing a prescription in her name for her husband’s use.

          Pham knew that many other pharmacies would not fill his prescriptions because they did not have a legitimate medical purpose, according to court documents. So, he directed his patients to Nguyen’s pharmacy, according to Nguyen’s plea agreement. There, Nguyen accepted payments from Pham’s patients and she subsequently gave Pham these payments from his patients for “office visits” even though she knew these patients did not have a legitimate office visit with Pham prior to her filling the prescription, her plea agreement states.

          Nguyen admitted in her plea agreement to filling prescriptions for eight individuals outside the usual course of professional medical practice and without a legitimate medical purpose.

          Nguyen further admitted that, from May 2017 to November 2018, she filled Pham-written prescriptions for a total of approximately 160 pills of oxycodone, approximately 1,810 pills of hydrocodone, and approximately 450 pills of amphetamine salts.

          Both Pham and Nguyen admitted in their plea agreements to abusing their positions of trust as a physician and pharmacist, respectively.

          United States District Judge Josephine L. Staton scheduled a January 6, 2023 sentencing hearing for Pham.

          The Drug Enforcement Administration’s Tactical Diversion Squad, the Irvine Police Department, and IRS Criminal Investigation investigated this matter.

          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

          Assistant United States Attorneys Brett A. Sagel and Gregory W. Staples of the Santa Ana Branch Office are prosecuting this case.

INFORMATION (Chavez) PLEA AGREEMENT (Chavez) PLEA AGREEMENT (Pacheco)

         

LOS ANGELES – A former San Bernardino County planning commissioner has agreed to plead guilty to a federal criminal charge for funneling bribes through his company to a corrupt Baldwin Park politician in exchange for the politician’s votes and influence over the city’s cannabis permitting process, the Justice Department announced today.

Gabriel Chavez, 65, of Upland, agreed to plead guilty to a one-count criminal information charging him with bribery. Both the information and Chavez’s plea agreement were filed today in United States District Court, and Chavez is expected to enter a guilty plea in the coming weeks.

The politician who solicited the bribes – former Baldwin Park City Councilmember Ricardo Pacheco – pleaded guilty in June 2020 to a federal bribery charge. Federal prosecutors today also unsealed additional portions of Pacheco’s plea agreement in which he admits to bribery schemes involving Chavez and other individuals.

Pacheco was first elected to the Baldwin Park City Council in 1997 and served as mayor pro-tem in 2018. He resigned from the city council in June 2021 and is awaiting sentencing.

Both Chavez and Pacheco have signed plea agreements in which they have agreed to cooperate in the government’s ongoing investigation.

According to Chavez’s plea agreement, in June 2017, Baldwin Park began permitting the cultivation, sale and manufacturing of marijuana within its city limits. Soon afterward, Pacheco decided to solicit bribe payments from businesses seeking marijuana development agreements and related permits in the city. In exchange for the illicit payments, Pacheco agreed to use his position in city government to assist the companies with obtaining marijuana permits.

Chavez agreed to act as an intermediary to funnel those bribes to Pacheco by using his Claremont-based internet marketing company, Market Share Media Agency. In exchange for the bribes, Pacheco agreed to vote and use his influence over the city’s permitting process to secure marijuana permits for two companies, identified in court documents as “Marijuana Company 3” and “Marijuana Company 4.”

Pacheco and Chavez agreed that Pacheco would get 60% of the companies’ bribe money while Chavez would retain the remainder as payment primarily for facilitating the bribes.

Chavez obtained bribe payments to pass to Pacheco from an individual identified in court papers as “Person 14,” another public official, who was helping Marijuana Company 4 obtain its marijuana permit. To conceal the true nature of the payments, the bribes Chavez accepted were disguised as consulting payments from Person 14’s consulting company to Market Share Media Agency.

From August 2017 to March 2018, Chavez received at least $125,000 from Marijuana Company 3 and at least $45,000 on behalf of Marijuana Company 4, none of which he reported to the IRS as personal income or as his company’s revenue. Chavez paid Pacheco between $80,000 and $93,000 in cash, out of at least $170,000 collected from both companies.

On multiple occasions, Chavez used coded language in text messages to tell Pacheco that he had cash bribes to pass to him. For example, in January 2018, Chavez sent Pacheco a text message stating, “I’m planning to bring all the documents…,” by which Chavez meant he planned to bring Pacheco cash bribes.

Per Chavez’s agreement with Pacheco, the cash payments were in exchange for Pacheo’s votes on the two companies’ marijuana permits and Pacheco’s help securing the necessary votes from other members of the Baldwin Park City Council.

Pacheco performed his end of the bargain, voting in favor of Marijuana Company 3 and Marijuana Company 4’s cannabis permits, first in December 2017 and later in May 2018.

Chavez further admitted in his plea agreement that Market Share Media Agency won a no-bid, $14,500 contract from the City of Huntington Park signed by Person 14. The no-bid contract represented, in part, further compensation for Chavez in his efforts facilitating the bribe to Pacheco to secure the marijuana permit for Marijuana Company 4 in Baldwin Park. To further secure this permit, Person 14 gave Chavez a $5,000 check made payable to the church associated with the school where Pacheco’s child attended.

Chavez was appointed to the San Bernardino County Planning Commission in June 2018 but resigned in November 2018 after the FBI executed a search warrant at his home.

The FBI and IRS Criminal Investigation are investigating this matter.

Any member of the public who has information related to this or any other public corruption matter in Los Angeles County is encouraged to send information to the FBI’s tip line at tips.fbi.gov or to contact the FBI’s Los Angeles Field Office at (310) 477-6565.

Assistant United States Attorneys Thomas F. Rybarczyk and Lindsey Greer Dotson of the Public Corruption and Civil Rights Section are prosecuting this case.

          SANTA ANA, California – A Fountain Valley man has agreed to plead guilty to federal offenses for operating illegal gambling dens and paying $128,000 in cash bribes to a Santa Ana Police officer to avoid law enforcement scrutiny of his underground casinos, according to a plea agreement filed today in federal court.

          Niem Ngoc Ha, aka “Dung Body,” 47, agreed to plead guilty to conspiracy, operating an illegal gambling business and bribery. These three offenses cumulatively carry a statutory maximum sentence of 20 years in federal prison. Ha is expected to formally enter the guilty pleas in court in the coming weeks.

          In the plea agreement, Ha admitted that he opened and operated four illegal casinos commonly called “nets” (if they are in a commercial district) or “slaphouses” (for those in residential areas), all of which were located in Santa Ana. Ha admitted to conspiring with three others to operate the casinos, which featured video gambling machines and generated thousands of dollars in profits each day.

          Ha acknowledged that acts of violence took place at the casinos. In one case, Ha directed a co-conspirator to physically assault a casino patron who had started a fight, and, in a separate incident, a worker at another casino was shot in the neck, according to the plea agreement.

          Ha also admitted that over the course of about six months in 2020 he paid approximately $128,000 to then-Santa Ana Police Officer Steven Lopez in an effort to protect his illicit casinos from law enforcement intervention. Lopez, who pleaded guilty in December 2020 to accepting the bribes and is no longer employed by the Santa Ana Police Department, is scheduled to be sentenced on June 5, 2023.

          Ha was one of nine defendants named in three indictments focusing on illegal gambling, attempted extortion and drug trafficking that were unsealed following a law enforcement takedown in May. Ha was named in an indictment that charges three other alleged co-conspirators, all of whom are currently scheduled to go on trial next May.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.

          The investigation into illegal gambling houses in Orange County is being conducted under the auspices of the Orange County Asian Organized Crime Task Force. The primary investigatory agencies are the FBI; the Santa Ana Police Department; the California Department of Justice, Bureau of Gambling Control; IRS Criminal Investigation; and the United States Postal Inspection Service.

          Assistant United States Attorneys Daniel S. Lim and Benjamin D. Lichtman of the Santa Ana Branch Office are prosecuting this case.

          LOS ANGELES – A San Bernardino County man was sentenced today to 60 months in federal prison for committing 52 smash-and-grab robberies of T-Mobile and AT&T cellphone stores throughout Southern California during a two-month crime spree, using hammers to smash display cases to steal iPhones and other merchandise.

          Tony Tyron Lee Stewart, 22, of Highland, was sentenced by United States District Judge John A. Kronstadt, who also ordered him to pay $333,122 in restitution.

          Stewart, the lead defendant in this case, pleaded guilty on June 9 to one count of conspiracy to interfere with commerce by robbery.

          On January 15, 2022, Stewart and two co-conspirators – Rayford Newsome, 21, of Compton; and Jerome Gregory Belser, 21, of San Bernardino – robbed T-Mobile stores in Long Beach, Carson, Inglewood, Encino, and Camarillo.

          Stewart and his co-conspirators entered the stores during store hours, carrying hammers with employees and customers present. Once inside the stores, the defendants, wearing ski masks, used the hammers to smash security display cases, threaten employees and customers, and then stole cellphones, watches, and other electronic devices. They then fled the store and made their escape in a car.

          After the Camarillo robbery on January 15, the trio – with Newsome driving – fled from police officers when law enforcement attempted a lawful traffic stop. Stewart and his co-conspirators led police on a vehicle pursuit through a residential neighborhood in North Hollywood before Newsome stopped the car.

          In addition to these robberies, from November 11, 2021 to January 13, 2022, Stewart and other members of the conspiracy committed smash-and-grab robberies at cellphone stores in Los Angeles, Orange, Ventura, San Bernardino, and Kern counties.

          Specifically, the stores robbed were located in South Los Angeles, West Los Angeles, Marina del Rey, Hermosa Beach, East Los Angeles, Boyle Heights, Lincoln Heights, Pico-Union, Hollywood, Koreatown, Silver Lake, Valley Village, Reseda, Sherman Oaks, Canoga Park, Woodland Hills, Agoura Hills, Mission Hills, San Fernando, Burbank, Pasadena, Alhambra, Monterey Park, Azusa, La Crescenta, South El Monte, Duarte, Monrovia, La Cañada Flintridge, Covina, Hacienda Heights, Lancaster, Norwalk, Downey, Bell Gardens, Cerritos, Bellflower, Rowland Heights, La Habra, Simi Valley, Camarillo, and Tehachapi.

          The robberies – several of which occurred on the same date – resulted in a loss of approximately $293,444. In addition, the robberies caused approximately $46,376 in damage to the stores.

          Both Newsome and Belser have pleaded guilty to one count of conspiracy to interfere with commerce by robbery in this case. On September 9, Judge Kronstadt sentenced Belser to 70 months in federal prison. Newsome’s sentencing hearing is scheduled for January 5, 2023, at which time he will face a statutory maximum sentence of 20 years in federal prison.

          “Stewart and his co-defendants terrorized cell phone stores throughout Southern California, traumatizing employees and customers in over 50 different stores in just over two months – all for [Stewart’s] own personal gain,” prosecutors argued in a sentencing memorandum. “In almost each of these…robberies, there were between two and four employees present along with multiple customers. Each employee is forced to return to these work locations, provide customer service, and attempt to earn a living a while dealing with the fear and anxiety that they may again be robbed or threatened with a dangerous weapon while at work.”

          The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Los Angeles Police Department investigated this matter.

          Assistant United States Attorneys Kevin B. Reidy and Kevin J. Butler of the Violent and Organized Crime Section prosecuted this case.

          LOS ANGELES – A federal grand jury today indicted three Long Beach men who allegedly participated in the daylight smash-and-grab robbery of a Beverly Hills jewelry store in which more than $2.6 million worth of merchandise was stolen.

          The two-count indictment returned today charges Long Beach residents Jimmy Lee Vernon III, 31, Ladell Tharpe, 37, and Deshon Bell, 20, with conspiracy and interference with commerce by robbery (Hobbs Act).

          According to the indictment, on March 23, the defendants and other co-conspirators drove in tandem in three vehicles headed from Long Beach to Beverly Hills. Once outside the victim jewelry store, Vernon and other co-conspirators allegedly got out of a Kia vehicle, smashed the store’s exterior glass cases multiple times, and then stole merchandise worth at least $2,674,000.

          Vernon and the others then ran out of the store to a nearby alley, leaving behind their Kia vehicle – which had been reported stolen out of Long Beach four days before the robbery, according to an affidavit filed with a criminal complaint in this case. During the robbery, Vernon’s cellphone fell out of his sweatpants pocket while he smashed the jewelry’s store’s window, was left behind and later recovered by law enforcement, the affidavit states.

          Bell allegedly waited in a car near the victim jewelry store and served as the getaway driver for Vernon and the other co-conspirators.

          The defendants allegedly stole property consisting of approximately 19 bracelets, seven pairs of earrings, four necklaces, a pair of obelisks, eight rings, and 20 watches.

          On March 25, Tharpe posted on his Instagram account numerous photographs that included large stacks of money and a message praising his “robbery gang,” according to the indictment.

          Law enforcement arrested the defendants last month. Vernon is in federal custody, was ordered jailed without bond, and his arraignment is scheduled for October 13 in United States District Court. Tharpe is in state custody and are expected to be remanded to federal custody in the coming weeks. Bell was released on $15,000 bond and his arraignment in federal court is scheduled for October 20. A juvenile, who is not charged in the federal indictment, also was arrested in connection with the robbery, and is charged in Los Angeles Superior Court with commercial burglary.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          If convicted of both charges, each defendant would face a statutory maximum sentence of 20 years in federal prison for each count.

          The FBI and the Beverly Hills Police Department investigated this matter.

          Assistant United States Attorneys Kevin J. Butler and Kevin B. Reidy of the Violent and Organized Crime Section are prosecuting this case.

          LOS ANGELES – A federal grand jury today indicted a Texas woman who allegedly illegally sold a live jaguar cub for approximately $30,000 to a Riverside County man who soon afterward re-sold the cub, which was ultimately abandoned on the doorsteps of an animal rescue center.

          Trisha Denise Meyer, a.k.a. “Mimi,” 40, of Houston, is charged in a four-count indictment with interstate transportation of an endangered species in the course of commercial activity, interstate sale of an endangered species, trafficking prohibited wildlife species, and trafficking endangered species.

          Also charged in the indictment returned today is Abdul Rahman, a.k.a. “Manny Rahman,” 34, of Murrieta, who is charged with interstate transportation of an endangered species in the course of commercial activity, trafficking prohibited wildlife species, and trafficking endangered species.

          The criminal charges against Meyer and Rahman allege violations of the Endangered Species Act, under which jaguars are protected, and the Lacey Act, which prohibits wildlife trafficking.

          Local and federal law enforcement agents in Houston are currently searching for Meyer. Rahman will be summonsed to appear in United States District Court in Riverside on November 9.

          According to the indictment, Meyer sold Rahman a live jaguar (Panthera onca) cub in spring 2021. Prior to the sale, Meyer posted on Instagram photographs and videos of herself with the cub, according to an affidavit filed with a criminal complaint in this case. The cub’s sale price was approximately $30,000 and the animal was transported – for an additional $1,000 fee – from Texas to California.

          Rahman owned the jaguar for one to two months before selling it for $20,000 to another buyer, identified in court documents as “H.G.” This individual lived in a house with a pregnant wife or girlfriend and later decided to allow the animal to be taken to a rescue center after someone expressed concerns about having a juvenile jaguar and a newborn infant in the same house, the affidavit states.

          The person who expressed concerns about the jaguar – identified in court documents as “R.A.” – later told law enforcement that he and his roommate put the jaguar in a large dog kennel and drove it to an animal rescue center in Alpine. They dropped off the jaguar at the facility’s entrance on September 17, 2021, at approximately 9:50 p.m. The event was captured on security cameras and law enforcement was notified.

          The jaguar remains at the animal sanctuary in Alpine.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          If convicted of all charges, Meyers would face a statutory maximum sentence of eight years in federal prison and a $700,000 fine. Rahman would face a statutory maximum sentence of seven years in federal prison and a $600,000 fine.

          The United States Fish and Wildlife Service and the California Department of Fish and Wildlife are investigating this matter.

          Assistant United States Attorney Joseph O. Johns of the Environmental and Community Safety Crimes Section is prosecuting this case.

          SANTA ANA, California – A federal grand jury today returned an eight-count indictment charging an Orange County man with defrauding California’s unemployment insurance program by using personal information stolen from people with similar names to apply for $1.25 million in COVID-19 unemployment benefits.

          Nhan Hoang Pham, 36, of Santa Ana, was charged with three counts of mail fraud in relation to benefits connected to presidentially declared emergency, one count of wire fraud in relation to benefits connected to presidentially declared emergency, and four counts of aggravated identity theft. Pham is currently in state custody on unrelated charges, and he is expected to be arraigned on the federal indictment following his release later this month.

          The indictment alleges that Pham, from approximately July 2020 through April 2021, submitted fraudulent applications for unemployment insurance after acquiring personal identifying information – such as dates of birth and Social Security numbers – from individuals with identical or similar names who lived in California, Texas and Michigan. Pham allegedly submitted 24 fraudulent applications to the California Employment Development Department (EDD), which administers unemployment insurance benefits for residents of California, including Pandemic Unemployment Assistance benefits to individuals who were unemployed because of the COVID-19 pandemic.

          Pham directed that unemployment benefit cards issued by Bank of America on behalf of the EDD be sent to mail drops he controlled in Anaheim, according to the indictment, which alleges that Pham and co-schemers used the benefit cards to withdraw cash from ATMs across Orange County.

          Pham allegedly filed applications that fraudulently sought $1,255,350 in unemployment benefits, and the total loss in this case is approximately $408,496.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          If convicted of the charges in the indictment, Pham would face a statutory maximum sentence of 30 years in federal prison for each of the four fraud counts. Additionally, the aggravated identity theft charges carry a mandatory two-year consecutive sentence.

          The United States Secret Service; the United States Department of Labor’s Office of Inspector General; the California Employment Development Department, Investigation Division; the Orange County District Attorney’s Office, Bureau of Investigation; and the Santa Ana Police Department conducted the investigation into Pham

          Assistant United States Attorney Daniel S. Lim of the Santa Ana Branch Office is prosecuting this case.

          LOS ANGELES – The United States Attorney’s Office for the Central District of California announced today that it is welcoming 14 additional federal prosecutors’ offices as they join the Justice Department’s Transnational Elder Fraud Strike Force as part of its continuing efforts to protect older adults and to bring perpetrators of fraud schemes to justice.

          Since 2019, current Strike Force members — including the Department’s Consumer Protection Branch, six U.S. Attorney’s Offices including the Central District of California, the FBI, U.S. Postal Inspection Service and Homeland Security Investigations — have brought successful cases against the largest and most harmful global elder fraud schemes and worked with foreign law enforcement to disrupt criminal enterprises, disable their infrastructure and bring perpetrators to justice.

          Expansion of the Strike Force will help to coordinate the Department’s ongoing efforts to combat sophisticated fraud schemes that target or disproportionately impact older adults. The expansion will increase the total number of U.S. Attorneys’ Offices comprising the Strike Force from six to 20, including all of the U.S. Attorneys’ Offices in California, Arizona, Texas, Florida, Georgia, Maryland and New York.

          “We are intensifying our efforts nationwide to protect older adults, including by more than tripling the number of U.S. Attorneys’ offices participating in our Transnational Elder Fraud Strike Force dedicated to disrupting, dismantling and prosecuting foreign-based fraud schemes that target American seniors,” said Attorney General Merrick B. Garland. “This expansion builds on the Justice Department’s existing work to hold accountable those who steal funds from older adults, including by returning those funds to the victims where possible.”

          “Our Office, along with our law enforcement partners across the District, have diligently pursued criminals who target and harm older adults, including in cases ranging from transnational romance scams, investment schemes, and even the kidnapping of a local older adult,” said United States Attorney Martin Estrada. “Members of our elder justice team also regularly conduct outreach to educate local seniors and to help them avoid new scams. Our goal is to protect our community from economic exploitation by providing information on how to avoid becoming a victim. When that fails, however, we will use all of our tools to investigate crimes that target our most vulnerable residents and vigorously prosecute those responsible for elder abuse.”

          The Strike Force expansion will further enhance the Department’s existing efforts to protect older adults from fraud and exploitation. During the period from September 2021 to September 2022, Department personnel and its law enforcement partners pursued approximately 260 cases involving more than 600 defendants, both bringing new cases and advancing those previously charged. The matters tackled by the Department and its partners ranged from mass-marketing scams that impacted thousands of victims to bad actors scamming their neighbors. Substantial efforts were also made over the last year to return money to fraud victims.

          This past year, the elder justice cases the United States Attorney’s Office in Los Angeles prosecuted included:

• Paul Ricky Mata, 59, a former Upland-based financial advisor now serving a 14-year federal prison sentence for committing a real estate investment scam that caused his clients – many of them elderly people who had invested their retirement savings – to lose more than $12 million.
• George Ugochukwu Egwumba, 47, of Cypress, and Princewell Arinze Duru, 33, of Sacramento, who are scheduled to be sentenced on October 17 after a federal jury found them guilty on June 15 of criminal charges for participating in an extensive, long-lasting, multimillion-dollar conspiracy – much of it committed by Nigerian nationals – that perpetrated a wide variety of frauds, including those committed against elders.
• Anuj Mahendrabhai Patel, 32, of Lake Elsinore, is serving a nine-year federal prison sentence for participating in an international fraud scheme in which he helped collect more than $550,000 in cash conned out of elderly victims by other co-conspirators pretending to be federal agents threatening the victims with arrest on bogus warrants.

          As part of the Central District of California’s elder fraud efforts, it engages in outreach to the community and industry to raise awareness about scams and exploitation and preventing victimization. In April 2022, our district's Elder Justice Coordinator gave a presentation to an audience of older adults at a local NGO's “Senior Safety Summit,” identifying the most reported scams currently targeting older adults, explaining cryptocurrency's role in prevalent scams, and providing tips on how to spot and hopefully avoid falling for any scam.

          The Central District of California is comprised of approximately 20 million residents and the seven counties of Los Angeles, Orange, Riverside, San Bernardino, Ventura, Santa Barbara, and San Luis Obispo.

          The Department of Justice today also highlighted two other efforts, including success in returning money to victims and efforts to combat grandparent scams.

          In the past year, the Department has notified over 550,000 people that they may be eligible for payments. Notifications were made to consumers whose information was sold by one of three data companies prosecuted by the Department and were later victims of “sweepstakes” or “astrology” solicitations that falsely promised prizes or individualized services in return for a fee. More than 150,000 of those victims cashed checks totaling $52 million, and thousands more are eligible to receive checks. Also notified were consumers who paid fraudsters perpetrating person-in-need scams and job scams via Western Union. In the past year, the Department has identified and contacted over 300,000 consumers who may be eligible for remission. Since March of 2020 more than 148,000 victims have received more than $366 million as a result of a 2017 criminal resolution with Western Union for the company’s willful failure to maintain an effective anti-money laundering program and its aiding and abetting of wire fraud.

          Over the past year, the Department pursued cases against the perpetrators of “grandparent scams,” otherwise known as “person-in-need scams.” These scams typically begin when a fraudster, often based overseas, contacts an older adult and poses as either a grandchild, other family member or someone calling on behalf of a family member. Call recipients are told that their family member is in jeopardy and is urgently in need of money. When recently sentencing one of eight perpetrators of a grandparent scam indicted under the Racketeer Influenced and Corrupt Organizations Act, a federal judge described such scams “heartbreakingly evil.” The Department is working with government partners and others to raise awareness about these schemes. Reporting from consumers about fraud and fraud attempts is critical to law enforcements efforts to investigate and prosecute schemes targeting older adults. If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available the National Elder Fraud Hotline: 1-833 FRAUD-11 (1-833-372-8311). This Department of Justice Hotline, managed by the Office for Victims of Crime, is staffed by experienced professional who provide personalized support to callers by assessing the needs of the victim and identifying next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting or connect them with agencies, and provide resources and referrals on a case-by-case basis. The hotline is staffed seven days a week from 3 a.m. to 8 p.m. Pacific Time. English, Spanish and other languages are available. More information about the Department’s elder justice efforts can be found on the Department’s Elder Justice website, www.elderjustice.gov.

          Some of the cases that comprise today’s announcement are charges, which are merely allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

          LOS ANGELES – A former California lawyer has been sentenced to 37 months in federal prison for lying to his clients about winning cases for them and then deceiving them with bogus documents – some with the forged signatures of judges, the Justice Department announced today.

          Matthew Charles Elstein, 52, of Redondo Beach, was sentenced late Monday afternoon by United States District Judge Mark C. Scarsi, who also ordered him to pay $254,354 in restitution.

          Elstein pleaded guilty in November 2021 to one count of wire fraud.

          Elstein was a licensed California attorney from December 1994 until the State Bar of California ordered him inactive in March 2019. From June 2015 to July 2018, Elstein engaged in a scheme to defraud his clients by falsely claiming he obtained favorable legal resolutions for them, when in fact the favorable resolutions had never been obtained.

          In some cases, Elstein never initiated any legal action. Elstein also admitted to misappropriating funds by falsely informing victims their fees were going into his client trust account, when in fact he directed them to deposit money into his personal bank account.

          “[Elstein] caused irreparable financial, reputational, and emotional damage to his victims that exceeds the mere monetary damage caused by a typical fraud,” prosecutors argued in a sentencing memorandum. “[Elstein’s] motive appears fueled not only by greed but also malice.”

          For example, in June 2016, Elstein falsely informed a corporate client that it had won a $52 million default judgment. He emailed the victim-client a fake court order that contained a judge’s forged signature. In order to conceal the fact that he never actually filed a lawsuit on his client’s behalf, Elstein further misrepresented that the case was improperly under seal due to a United States Department of Justice investigation.

          To further his fraudulent scheme, Elstein presented his clients with a fake settlement agreement between the client and the United States Attorney’s Office for the Eastern District of California. It was not until the company reached out to that United States Attorney’s Office to authenticate the settlement agreement that it discovered that the agreement was a forgery.

          Elstein also fabricated depositions in a federal case in Washington state in September 2015. Because these depositions were fake, no one appeared for them. Nonetheless, Elstein had a court stenographer present and made a formal record of the nonappearances. Elstein also billed the client for attending the sham depositions and his travel expenses to Seattle.

          Elstein also falsely told the victim that he had obtained a $4.25 million judgment in the victim’s favor and provided the victim with a fake court order containing the forged signature of a judge. When the victim traveled to Seattle to collect the judgment, he was informed by the court that no such case existed.

          In total, Elstein’s fraudulent schemes resulted in losses of at least $358,855 to his victims.

          The FBI’s Public Corruption Squad investigated this matter.

          Assistant United States Attorney Daniel J. O’Brien of the Public Corruption and Civil Rights Section prosecuted this case.

          LOS ANGELES – A Bay Area man and former FBI special agent was found guilty today by a federal jury of conspiring to accept at least $150,000 in cash bribes and other items of value in exchange for providing sensitive law enforcement information to a corrupt lawyer with ties to Armenian organized crime.

          Babak Broumand, 56, of Lafayette, California, was found guilty of one count of conspiracy, two counts of bribery of a public official, and one count of monetary transactions in property derived from specified unlawful activity.

          United States District Judge R. Gary Klausner scheduled a January 30, 2023 sentencing hearing, at which time Broumand will face statutory maximum sentences of 15 years in federal prison for each bribery count, 10 years in federal prison for each unlawful monetary transactions count, and five years in federal prison for the conspiracy count.

          Judge Klausner ordered Broumand remanded into federal custody.

          Broumand, an FBI special agent from January 1999 until shortly after search warrants were served on his home and businesses in 2018, was responsible for national security investigations and was assigned to the FBI Field Office in San Francisco.

          According to evidence presented at his 11-day trial, from January 2015 to December 2018, Broumand accepted cash, checks, private jet flights, a Ducati motorcycle, hotel stays, escorts, meals, and other items of value from an organized crime-linked lawyer – identified in court papers as “E.S” and each man acted to conceal the true nature of their corrupt relationship.

          In return for the bribe payments and other items of value, Broumand conducted law enforcement database inquiries and used those inquiries to help E.S. and his associates avoid prosecution and law enforcement monitoring. Specifically, Broumand informed E.S. whether a particular person or entity was under criminal investigation by stating that E.S. should “stay away” from that person or that they were “OK.”

          To conceal the nature of their corrupt relationship, Broumand made it falsely appear that E.S. was working as an FBI source. Broumand wrote reports after the fact to make it falsely appear that he conducted legitimate law enforcement database inquiries.

          In exchange for the illegal inquiries, E.S. paid Broumand at least $150,000 in cash and check bribes, including a Ducati motorcycle and accessories valued at more than $36,000. The bribes were deposited into the accounts for Love Bugs LLC, a Lafayette-based lice-removal hair salon business that Broumand and his wife started in 2007.

          Soon after the bribery scheme began, E.S. asked Broumand to query the FBI database for Levon Termendzhyan, an Armenian organized crime figure for whom E.S. had worked. The database search “rang all the bells” and revealed an FBI investigation in Los Angeles, according to court documents, which note that Broumand accessed the FBI case file on Termendzhyan repeatedly in January 2015. Broumand also allegedly accessed the Termendzhyan FBI case file in May 2016.

          Termendzhyan, a.k.a. “Lev Aslan Dermen,” was found guilty in March 2020 in federal court in Utah on criminal charges related to a $1 billion renewable fuel tax credit fraud scheme. He awaits sentencing.

          In December 2015, at E.S.’s request, Broumand searched a confidential FBI database for information about Sam Sarkis Solakyan, a medical imaging companies CEO, and later warned E.S. to “stay away” from Solakyan, who was “trouble,” meaning that Solakyan was under law enforcement investigation. Solakyan eventually was charged, tried, convicted and sentenced to five years in federal prison for running a scheme that submitted more than $250 million fraudulent claims through California’s workers compensation system.

          In May 2016, Broumand interfered with an FBI investigation into Felix Cisneros Jr., a corrupt special agent with Homeland Security Investigations who also had ties to Termendzhyan. Cisneros was convicted at trial in two different cases. The first trial, in 2018, resulted from Cisneros’s corrupt acts for Termendzhyan. The second trial, earlier this year, resulted from Cisneros’ corrupt acts for E.S. Cisneros is scheduled for sentencing on October 17.

          “Ensuring public confidence in those who investigate and enforce the law is paramount,” said United States Attorney Martin Estrada. “By taking bribes and gifts from a person he knew was linked to organized crime, Mr. Broumand breached the public trust placed in him and violated his oath of office, something which simply cannot be tolerated. The FBI’s agents and staff work tirelessly every day to keep us safe, and I am proud that they partnered with our Office to ferret out this corruption.”

          “The conviction of Mr. Broumand, a veteran FBI agent who chose greed over integrity and turned his back on the oath he swore to uphold, is proof that the FBI will root out corruption of any kind, to include veteran agents within its ranks,” said Don Alway, the Assistant Director in Charge of the FBI's Los Angeles Field Office. “This prosecution was the result of hard work by multiple partner agencies to work through the painful truth of having to investigate one of its own.”

          “Broumand conspired with the very types of criminals he was trusted to investigate. Today’s guilty verdict sends a clear message that no one is above the law, and any Department of Justice employee who participates in these types of schemes will be brought to justice,” said Zachary Shroyer, Special Agent in Charge of the Department of Justice Office of the Inspector General Los Angeles Field Office.

          “All of us in law enforcement are held to a higher standard and this is no exception,” stated IRS Criminal Investigation Oakland Field Office Special Agent in Charge Mark H. Pearson. “The American public places high expectations on law enforcement to uphold and defend the law. While today is a blemish in our community as Babak Broumand, a former FBI Agent, was found guilty for conspiring, bribery, and money laundering; I want to emphasize and highlight the exceptional professionalism, integrity and dedication demonstrated by the Federal Bureau of Investigation special agents, the Office of Inspector General, DOJ, the United States Attorney’s Office – CDCA, and the Internal Revenue Service-Criminal Investigation, for their commitment to upholding the law and seeing that justice is sought in all cases regardless of a person’s affiliation. I want to thank our partners for entrusting us with this investigation, and hope that the American public sees our efforts as an example of what the good men and women in law enforcement represent.”

          The jury today also found Broumand not guilty of one count of bribery of a public official and one count of monetary transactions in property derived from specified unlawful activity.

          The FBI, the United States Department of Justice Office of the Inspector General, and IRS Criminal Investigation investigated this matter and were assisted at trial by the Department of Homeland Security, Office of the Inspector General.

          Assistant United States Attorney Ruth C. Pinkel of the Public Corruption and Civil Rights Section and Assistant United States Attorneys Michael J. Morse and Juan M. Rodríguez of the General Crimes Section are prosecuting this case.

          LOS ANGELES – Martin Estrada, the United States Attorney for the Central District of California, announced today the creation of an Environmental Justice Coordinator and the prioritization of Environmental Justice Enforcement under his leadership as top federal prosecutor in the nation’s most populous federal judicial district.

          Assistant United States Attorney Amanda M. Bettinelli has been selected to serve as the office’s Environmental Justice Coordinator. In this role, she will focus on protecting the rights of district residents who are disproportionately burdened by environmental and health hazards, including those affected by illegal dumping, soil contamination and child lead exposure.

          The Central District of California is comprised of approximately 20 million residents in the counties of Los Angeles, Orange, Riverside, San Bernardino, Ventura, Santa Barbara, and San Luis Obispo.

          The Office is creating this position in recognition of President Joseph Biden’s directive in Executive Order 14008, which mandates that “[a]gencies shall make achieving environmental justice part of their missions by developing programs, policies, and activities to address the disproportionately high and adverse human health, environmental, climate-related and other cumulative impacts on disadvantaged communities, as well as the accompanying economic challenges of such impacts.”

          “Protecting the environment is critical to the work of this Office and our Environmental Justice Coordinator will support our longstanding commitment to protecting the communities that we serve by investigating and prosecuting environmental violations,” said United States Attorney Martin Estrada. “Pollution and other environmental threats all too often disproportionately impact people of color and underserved communities. We will continue to vigorously enforce federal environmental laws and hold polluters accountable.”

          The Office maintains a dedicated Environmental Crimes and Community Safety Section and the Environmental Justice Coordinator will play a critical role in the Office’s longstanding commitment to fighting environmental crimes and pollution. The Office will continue to partner and coordinate with the Environmental Protection Agency, law enforcement partners, local communities, and agencies across federal, state, and local governments to better serve the needs of disadvantaged communities and the mission of environmental justice throughout the Central District of California.

          LOS ANGELES – A San Gabriel Valley man was sentenced today to 48 months in federal prison for scheming to help wealthy Chinese nationals unlawfully gain admission into the United States by falsely making them eligible for student visas through a network of fraud, including imposter test takers, essay ghostwriters and fake transcript sellers.

          Yi Chen, a.k.a. “Brian Chen,” 35, of Monrovia, was sentenced by United States District Judge Mark C. Scarsi, who also ordered him to pay a criminal fine of $400,000 and to forfeit $50,000 of his ill-gotten gains.

          After a six-day bench trial that concluded on March 21, Judge Scarsi found Chen guilty of one count of visa fraud and one count of aggravated identity theft. Chen was acquitted of one count of conspiracy to commit immigration document fraud and 10 counts of visa fraud.

          From June 2015 to February 2021, Chen was the CEO and owner of two “educational consulting” companies in Alhambra and Arcadia – Prime U.S. International and MS Education. These companies charged foreign students thousands of dollars for “guaranteed” admission to a college that would lead to the issuance of an F-1 student visa.

          To secure admission to a school, the companies prepared application packages that used bogus or altered transcripts, and they hired people to impersonate the prospective student to take standardized tests, such as the Test of English as a Foreign Language (TOEFL). Chen submitted applications containing these fraudulent supporting materials on behalf of at least one foreign national, which helped the student obtain admission to New York University.

          Once a foreign student was admitted to a college, the school issued a “Form I-20, Certificate of Eligibility for Nonimmigrant (F-1) Student Status – For Academic and Language Students,” which provided the basis for a student visa application or extension of permission to remain in the United States.

          “Under the guise of operating an ‘educational consulting’ company, [Chen] made millions of dollars by faking every aspect of the college admissions process,” prosecutors argued in a sentencing memorandum.

          Chen, who has been in federal custody since March 2021, received the lion’s share of the profits from the visa fraud scheme. He also controlled seven bank accounts that received more than $15 million in deposits between 2016 and 2020.

          Chen and co-defendant Yixin Li, a.k.a. “Eason Li” and “Calvin Wong,” 29, of San Gabriel, are linked to a group of imposter test-takers who were the subject of an earlier indictment that outlined how they used fake Chinese passports to take TOEFL exams on behalf of foreigners seeking college admissions and student visas. All six defendants in that earlier case pleaded guilty and were sentenced to probation. Li was sentenced on February 22 to time served.

          Homeland Security Investigations and the Department of State, Diplomatic Security Service investigated this matter. U.S. Citizenship and Immigration Services, Fraud Detection and National Security Section, provided substantial assistance. The Educational Testing Service, which administers the TOEFL exam, provided assistance during the investigation.

          Assistant United States Attorneys Julia Hu of the Major Frauds Section and Maria Jhai of the Terrorism and Export Crimes Section prosecuted this case.

          RIVERSIDE, California – The former mayor pro tem of Adelanto was sentenced today to 60 months in federal prison for accepting a $10,000 cash bribe and hiring a man to burn down his restaurant so he could fraudulently collect hundreds of thousands of dollars in insurance proceeds.

          Jermaine Wright, 46, of Riverside, was sentenced by United States District Judge Jesus G. Bernal.

          At the conclusion of a six-day trial, a federal jury on June 22 found Wright guilty of one count of bribery of programs receiving federal funds and one count of attempted arson of a building affecting interstate commerce.

          In early 2017, federal investigators began a probe into possible corruption in Adelanto, a city located in San Bernardino County. During the investigation, law enforcement used an informant who introduced Wright to two undercover FBI agents and recorded a series of conversations in which Wright discussed both plots.

          In the first scheme, Wright – then an Adelanto city councilman as well as the city’s mayor pro tem – accepted a $10,000 bribe from an undercover FBI agent who told Wright he wanted his assistance in securing votes to expand the marijuana business zone, and for protection from code enforcement related to a supposed marijuana transportation business.

          “Unfortunately, [Wright’s] decision to accept a $10,000 bribe payment was not a one-off event,” prosecutors wrote in a sentencing memorandum. “The recordings in this case show that he spoke to the undercover agent…over a period of months. [Wright] initially quoted a price of $20,000 for his vote on a City Council matter. Later, he suggested $15,000 for ‘pushing’ permits. Finally, he accepted a $10,000 payment, and he said that he expected ‘a stack,’ or $2,000, each time he would interfere with code enforcement going forward.”

          In the second scheme, in August 2017, Wright sought the informant’s assistance in finding someone to burn down Fat Boyz Grill, his restaurant in Adelanto. In late September, Wright asked the informant to pass his cell phone number to the “electrician” – so named because Wright wanted the cause of the fire to appear to be an electrical problem.

          Wright met the “electrician” – actually the second undercover FBI agent – on October 3, 2017 and said he wanted the fire on the following Saturday when the sprinkler system would be turned off. After Wright assured the undercover agent that his insurance policy covers everything, the “electrician” agreed to do the job for $1,500. At a meeting three days later, Wright paid the $1,500 after the undercover agent told Wright he needed more time to prepare for the job.

          Wright also gave the agent a tour of the restaurant and assisted in the planning of the arson by providing a ladder for the undercover agent and discussing various tactics to ensure the planned arson would be a success.

          In October 2017, the FBI executed a search warrant at Fat Boyz Grill and interviewed Wright, who confessed to hiring the undercover agent to burn down the restaurant. The next day, the informant reported to the FBI that Wright had told the informant that the FBI had approached Wright, and that Wright requested the informant’s assistance in making the undercover agent “go away,” according to court documents.

          In October 2017, the FBI executed a search warrant at Fat Boyz Grill and interviewed Wright, who confessed to hiring the undercover agent to burn down the restaurant. The next day, the informant reported to the FBI that Wright had told the informant that the FBI had approached Wright, and that Wright requested the informant’s assistance in making the undercover agent “go away.”

          The FBI investigated this matter.

          Assistant United States Attorney Sean D. Peterson, Chief of the Riverside Branch Office, prosecuted this case.

          LOS ANGELES – A federal grand jury today charged a La Cañada Flintridge man who allegedly conspired with a San Fernando Valley resident to hire a hitman to kill two men involved in litigation against him.

          Arthur Raffy Aslanian, 53, is charged in a three-count indictment with one count of conspiracy to use interstate commerce facilities in the commission of murder-for-hire. Also facing this charge in the indictment is Sesar Rivera, 40, of North Hollywood, Aslanian’s employee and alleged co-conspirator.

          Both defendants were arrested earlier this month on a federal criminal complaint alleging the murder-for-hire plot. Today’s indictment adds an additional charge to each defendant, charging Aslanian and Rivera each with one count of use of interstate commerce facilities in the commission of murder-for-hire.

          Aslanian was ordered jailed without bond after his arrest on September 15. His arraignment is scheduled for October 6 in United States District Court in downtown Los Angeles. Rivera made his initial court appearance on September 19 and is free on $20,000 bond. His arraignment is scheduled for October 25.

          According to the indictment returned today, in April 2022, Rivera met with an individual and said that a real estate businessman named “Arthur” wanted to pay this individual to kill two people – identified in the indictment as “S.E.” and “M.Y.” – who were involved in litigation against him.

          M.Y. was a lawyer who represented Aslanian in a bankruptcy proceeding in which Aslanian had prevailed but then refused to pay approximately $220,000 in legal fees and expenses to M.Y.’s law firm, according to court documents. In early 2022, M.Y.’s law firm filed paperwork to mediate the dispute and prepared to sue Aslanian if the mediation failed.

          S.E. had defeated Aslanian in court, after Aslanian tried to take possession of the Brentwood home in which S.E.’s parents lived, court documents state.

          In July 2022, Rivera again allegedly met with the individual and said “Arthur” wanted the killing done as soon as possible. Rivera showed the individual information about M.Y. The individual secretly recorded a portion of this July 2022 in-person meeting on his phone and provided a copy of the recording to law enforcement, according to an affidavit filed with the criminal complaint in this case.

           Rivera allegedly also promised the individual that Aslanian would pay $20,000 for the murder once Rivera had photographic proof that the murder had been committed.

          On August 10, Rivera allegedly again met with the individual and told him to focus on murdering S.E. before murdering M.Y. On August 19, Rivera allegedly used the Facebook Messenger application to send the individual a multi-media message with a screenshot of victim S.E.’s Facebook profile, including S.E.’s picture and business name, to assist the CI in locating and murdering S.E.

          Law enforcement contacted and warned M.Y. and S.E. of the murder plots against them, court papers state.

          On September 7, law enforcement detained and questioned Rivera, who later agreed to cooperate with them, according to court documents.

          Aslanian was arrested shortly after a September 15 meeting in which Rivera showed him a staged murder photograph of S.E.

          An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          If convicted of all charges, each defendant would face a statutory maximum sentence of 20 years in federal prison.

          The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Los Angeles Police Department investigated this matter.

          Assistant United States Attorneys Kevin B. Reidy and Kevin J. Butler of the Violent and Organized Crime Section are prosecuting this case.

          LOS ANGELES – The Justice Department today announced that Westlake Financial has agreed to pay more than $225,000 to resolve allegations that it violated the Servicemembers Civil Relief Act (SCRA) by failing to provide qualified servicemembers with interest rate benefits for the entire period required under the SCRA and by improperly delaying approval of interest rate benefit requests.

          “Servicemembers make enormous sacrifices, and we have a responsibility to protect their rights and ensure they have full access to important benefits guaranteed under the law,” said United States Attorney Martin Estrada. “The settlement with Westlake Financial reflects the Justice Department’s firm commitment to protecting the rights of servicemembers – and to defending civil rights for everyone.”

          “The Servicemembers Civil Relief Act makes clear that those serving in our nation’s military are entitled to receive interest rate benefits as soon as they are called to service,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “This settlement sends the message that we will hold companies accountable when they deny servicemembers the important interest rate benefits they are entitled to under federal civil rights law.”

          The SCRA provides that interest on any debt incurred by a servicemember before entering military service is limited to 6 percent per year. To take advantage of the interest rate cap, a servicemember must provide the creditor with written notice and a copy of their military orders or other documentation of their military service no later than 180 days after leaving service. After receiving notice, a creditor must forgive any interest in excess of 6 percent retroactively back to the date orders are issued calling the servicemember to active duty.

          Westlake Financial is a Los Angeles-based auto finance company that specializes in subprime and near-subprime loans. In 2017, the Justice Department filed a complaint in United States District Court in Los Angeles alleging that Westlake and its subsidiary, Wilshire Commercial Capital, violated the SCRA by unlawfully repossessing at least 70 vehicles owned by SCRA-protected servicemembers. To resolve those allegations, Westlake entered into a settlement requiring the company to pay over $700,000 to servicemembers and a $60,788 civil penalty and to be subject to monitoring by the department.

          While monitoring Westlake’s compliance with the SCRA, the Justice Department discovered problems with the company’s handling of interest rate benefit requests. The department determined that Westlake was failing to apply interest rate benefits back to the date orders were issued calling the servicemember to active duty. The department also determined that Westlake had improperly delayed the approval of interest rate benefits to some servicemembers.

          Under an amended settlement agreement, Westlake has agreed to pay an additional $185,460 to 250 servicemembers who did not receive interest rate benefits back to the date their orders were issued or who had to wait more than 60 days to receive their benefits. Each servicemember who did not receive interest rate benefits back to the date their orders were issued will receive a refund of any excess interest they paid, as well as an additional payment of three times the overpayment or $100, whichever is higher. Servicemembers whose interest rate approvals were delayed more than 60 days will each receive $500. Westlake will also be required to pay an additional $40,000 civil penalty to the United States. The amended agreement also requires Westlake to revise its SCRA policies and procedures and training to ensure that interest rate benefits are timely and appropriately applied to servicemember accounts.

          Assistant United States Attorney Matthew E. Nickell of the Civil Division’s Civil Rights Section, and Trial Attorneys Audrey M. Yap and Alan A. Martinson of the Justice Department’s Civil Rights Division’s Housing and Civil Enforcement Section worked on this case.

          Since 2011, the Justice Department has obtained over $476 million in monetary relief for over 121,000 servicemembers through its enforcement of the SCRA. For more information about the department’s SCRA enforcement efforts, please visit www.servicemembers.gov.

          Servicemembers and their dependents who believe that their rights under the SCRA have been violated should contact the nearest Armed Forces Legal Assistance Program Office. Office locations may be found at http://legalassistance.law.af.mil.

          LOS ANGELES – A Riverside man who previously served a lengthy prison sentence in two aircraft-related cases was sentenced today to nearly four years in federal prison for selling bogus aircraft parts and for falsifying related documents.

          Aman Khan, who is also known as Amanullah Khan, 73, of Riverside, was ordered to serve 46 months in prison by United States District Judge R. Gary Klausner. In addition to the prison term, Judge Klausner ordered Khan to pay $1,538,054 in restitution and further ordered the forfeiture of all aircraft components seized from Khan’s former business.

          Khan pleaded guilty on June 6 to two counts of fraud involving aircraft parts in interstate and foreign commerce, admitting that he sold fraudulent, counterfeit and unapproved aircraft parts from his Riverside-based company, California Aircraft and Avionics Corporation.

          Court documents outline how Khan manufactured various parts – including wheel assemblies and aircraft turbine gas nozzles that had been ordered for NATO jets – and submitted documents that falsely certified the provenance of the equipment and conformity to approved design data.

          “By selling fraudulent and unapproved parts to companies in the aircraft industry, [Khan] caused the risk that his parts would be installed on commercial and military aircraft instead of genuine aircraft parts,” Khan admitted in his plea agreement. “In so doing, [Khan] consciously and recklessly caused a risk of death or serious bodily injury to aircraft passengers and to the general public.”

          Khan previously was convicted in this district of aircraft parts fraud and export violations. In 2005, Khan was sentenced to 188 months in federal prison for both falsely certifying flight-critical aircraft parts sold by his company and, in a separate case brought in the District of Columbia, for selling parts for military jet fighters to China.

          The United States Department of Transportation, Office of Inspector General; the United States Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement; the Defense Criminal Investigative Service; the FBI, and NASA’s Office of Inspector General conducted the investigation that resulted in today’s sentencing.

          Assistant United States Attorney Benjamin D. Lichtman of the Santa Ana Branch Office prosecuted this case.

          LOS ANGELES – An Orange County man was sentenced today to 48 months in federal prison for fraudulently obtaining more than $5 million in COVID-relief loans for three shell companies.

          Raghavender Reddy Budamala, 36, of Irvine, was sentenced by United States District Judge Otis D. Wright II, who also ordered Budamala to pay $5,151,497 in restitution.

          Budamala pleaded guilty on June 21 to one count of bank fraud and one count of money laundering. As part of his plea agreement, Budamala agreed to forfeit real estate in Orange County, Malibu and Los Angeles, as well as approximately $4,119,662 in funds from bank and investment accounts and cryptocurrency.

          From January 2019 to August 2019, Budamala formed or acquired three shell companies with no operations – Hayventure LLC, Pioneer LLC, and XC International LLC. Following the outbreak of the COVID-19 pandemic and the enactment of federal programs designed to address the resulting economic fallout, Budamala submitted to the Small Business Administration seven applications for pandemic-relief loans under the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) program.

          As part of the applications filed from April 2020 through March 2021, Budamala falsely represented to the banks administering the COVID-relief business loan programs that his companies employed dozens of individuals and earned millions of dollars in revenue, and that he needed the money for payroll and business expenses.

          The addresses listed for the companies were bogus, nonexistent or residential. The states where Budamala’s companies purportedly operated have no records of those companies paying wages to any employees, and bank records for the companies reflect no significant business income or operating expenses.

          The SBA and the banks funded six of the loans and disbursed a total of $5,151,497. Budamala applied to have several of the loans forgiven and falsely represented that he had used the SBA money entirely for payroll.

          Once the loans were funded, Budamala used the money to pay for personal expenses, including the purchase of a $1.2 million investment property in Eagle Rock, the purchase of a $597,585 property in Malibu, the purchase of a personal residence in Irvine, a $970,000 investment in an EB-5 Immigrant Investor Visa Program and a nearly $3 million deposit into Budamala’s personal TD Ameritrade account.

          Budamala has been in federal custody since his arrest on February 23, when he attempted to abscond from the United States to Mexico via the San Ysidro border crossing. A criminal complaint was filed against him on February 24.

          IRS Criminal Investigation, the FBI, and the Small Business Administration’s Office of Inspector General investigated this matter.

          Assistant United States Attorney Gregory D. Bernstein of the Major Frauds Section and Assistant United States Attorney Maxwell K. Coll of the Asset Forfeiture and Recovery Section prosecuted this case.

          In May 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.

          LOS ANGELES – The owner of an Inland Empire business pleaded guilty today to filing false tax returns that failed to report more than $4.8 million over a five-year period, resulting in his failure to pay $1.6 million in taxes due to the IRS.

          Liang “Paul” Chen, 63, the owner of the Chino-based construction company Mass Development Inc. (MDI), who is identified in court documents as a resident of Los Angeles County, admitted in court today that he filed false corporate tax returns for the years 2013 through 2016.

          Chen pleaded guilty to one count of aiding and assisting in the preparation of a false income tax return. In a plea agreement filed in federal court, Chen agreed to pay the IRS restitution of $1,642,935.

          According to his plea agreement, from January 2013 through October 2017, Chen was in charge of MDI’s daily business activities and was listed as the owner of MDI on its financial documents. To conceal income, Chen deposited only a portion of the checks made payable to MDI into the company’s bank account and then cashed nearly $5 million of additional checks made payable to MDI at a bank and a local liquor store that offered check-cashing services.

          In relation to MDI’s federal tax returns, Chen provided the tax return preparer with statements from MDI’s business bank account as and falsely advised the tax return preparer that all of MDI’s income had been deposited into the business bank account.

          By failing to tell MDI’s return preparer that he had cashed a substantial portion of business checks made payable to MDI, Chen caused MDI to falsely report its gross receipts to the IRS. This underreporting resulted in an underpayment of federal taxes totaling $1,642,935.

          Chen is scheduled to be sentenced by United States District Judge Mark C. Scarsi on December 12, at which time Chen will face a statutory maximum sentence of three years in federal prison.

          IRS Criminal Investigation investigated this matter.

          Assistant United States Attorney Steven M. Arkow of the Major Frauds Section is prosecuting this case.

          LOS ANGELES – An Orange County man was charged today in a federal criminal complaint that alleges he punched a flight attendant in the back of the head during a flight from Mexico to Los Angeles – an assault that a fellow passenger recorded on video.

          Alexander Tung Cuu Le, 33, of Westminster, is charged with one count of interference with flight crew members and attendants, a crime that carries a statutory maximum sentence of 20 years in federal prison.

          Le is expected to make his initial appearance this afternoon in United States District Court in downtown Los Angeles.

          According to an affidavit filed with the complaint, on September 21, Le flew on American Airlines flight 377 from San José del Cabo, Mexico to Los Angeles International Airport. Approximately 20 minutes after takeoff, Le exited his seat while flight attendants were conducting food and beverage service. Le grabbed one flight attendant’s left shoulder from behind and asked for coffee. Moments later, Le grabbed both of the flight attendant’s shoulders from behind. After the flight attendant stepped back and put up a defensive posture, Le walked to the front of the airplane.

          Le then allegedly loitered near the first-class cabin and then sat in an unoccupied aisle near the wall dividing the first-class cabin and the main cabin of the aircraft. A different flight attendant approached Le and requested that Le return to his assigned seat. Le did not comply and allegedly stood up and assumed a fighting stance towards the flight attendant by making closed fists with both of his hands, which the flight attendant interpreted as a threat.

          Around this time, Le allegedly swung his arm at the flight attendant and missed. The flight attendant decided to report Le’s behavior to the pilot, turned away from Le and walked towards the front of the airplane. At this time, Le rushed toward the flight attendant and punched him in the back of the head, which was witnessed by several passengers, including one who filmed the attack, according to the affidavit.

          After assaulting the flight attendant, Le fled toward the back of the airplane. Several passengers apprehended Le near an exit row. Out of safety concerns, Le was moved to a different row, and his hands and legs were cuffed. Le continuously unbuckled his seatbelt, causing flight attendants to restrain him to the seat with seatbelt extenders.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          The FBI is investigating this matter.

          Assistant United States Attorney Kellye Ng-McCullough of the General Crimes Section is prosecuting this case.

          LOS ANGELES – A Beverly Hills man – whose sons pleaded guilty earlier this month to felonies for defrauding COVID-relief programs – pleaded guilty today to a federal criminal charge for fraudulently seeking more than $6.7 million in COVID-related small business loans for more than half a dozen fake companies.

          Ramiro Da Rosa Mendes, 61, pleaded guilty to one count of wire fraud.

          According to his plea agreement, from April 2020 to August 2020, Mendes schemed to fraudulently obtain federal disaster relief funds distributed through the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) programs that were intended to help small businesses through the economic shock of the COVID-19 pandemic.

          Mendes claimed to own numerous fake businesses purportedly based in Beverly Hills, including One Wilshire Enterprises, Professional Music Services, and MB Property Management Group LLC. These companies were fake businesses that did not exist prior to the COVID-19 pandemic and did not have any operations or employees.

          Mendes also claimed to be the owner of fake real estate services companies, including Ramiro Mendes Real Estate Services, Real Estate Services, and Real Estate Invesst-ments, also located in Beverly Hills and Massachusetts, as well as other businesses registered in Wyoming.

          In his plea agreement, Mendes admitted to submitting 19 applications for PPP and EIDL loans that contained false and fraudulent information, including the purported existence of payroll expenses, phony tax forms, and the operational status of the businesses.

          For example, on June 24, 2020, Mendes submitted a fraudulent PPP loan application to a Florida-based bank, seeking a loan of $975,100. The loan application falsely stated that One Wilshire Enterprises employed 18 people, had an average monthly payroll of $390,040, and, according to a false tax form, earned $4,810,149 in revenue in 2019. Based on this false information, the bank approved and funded a PPP loan in the amount of $793,300. The loan amount was wired into a bank account Mendes controlled.

          Mendes admitted in his plea agreement to stealing the COVID-relief loans and misusing the proceeds for his own personal benefit, including the purchase of cryptocurrency. He further admitted that the intended loss in this case was approximately $6,708,963 and the actual loss was at least approximately $2,228,302.

          United States District Judge Percy Anderson scheduled a December 12 sentencing hearing, at which time Mendes will face a statutory maximum sentence of 20 years in federal prison.

          In separate cases, Mendes’ sons – Ammon Jose de Pina Mendes, 26, of Beverly Hills, and Mateus Pina Mendes, 33, of Los Angeles – each pleaded guilty on September 1 to one count of wire fraud. Using the names of fake businesses, Ammon and Mateus Mendes fraudulently obtained approximately $222,225 and $143,283, respectively, in PPP and EIDL loans. Their sentencing hearings are scheduled for November 29, at which time each defendant will face up to 20 years in federal prison.

          This matter was investigated by the FBI; the Federal Housing Finance Agency – Office of the Inspector General; the United States Postal Inspection Service; the Federal Deposit Insurance Corporation – Office of the Inspector General; the Treasury Inspector General for Tax Administration – Office of the Inspector General; IRS Criminal Investigation; and the Small Business Administration – Office of the Inspector General.

          Assistant United States Attorney Scott Paetty of the Major Frauds Section and Trial Attorney Jennifer Bilinkas of the Justice Department’s Fraud Section are prosecuting this case.

          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 Hotline at (866) 720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

          LOS ANGELES – An Echo Park man has agreed to plead guilty to federal criminal charges for using an online messenger app to attempt to sexually traffic two children – ages 7 and 9 – and for distributing sexually explicit images of children, the Justice Department announced today.

          Francisco Anthony Dorame, 41, a.k.a. “dadboss99,” a.k.a. “SEXYCONN,” is charged in an information with one count of attempted sex trafficking of a child under 14 years old and one count of distribution of child pornography. He has agreed to plead guilty to the charges.

          Dorame is expected to appear Thursday for his arraignment in United States District Court in downtown Los Angeles. He has been in federal custody since his arrest on a federal criminal complaint in this matter on August 23.

          According to his plea agreement filed Tuesday, in May 2022, Dorame used Kik Messenger, a social media messaging platform, to knowingly attempt to traffic two minor children – ages 7 years old and 9 years old. During a Kik conversation, Dorame made two payments, totaling $100, to a person who had access to the victims. Among other things, Dorame requested photographs of the victims, expressed his desire to “play with them right away” upon meeting up, and set a specific date, time, and location for the meeting.

          Dorame further admitted in his plea agreement that in April 2022 he used Kik to distribute sexually explicit images of children between the ages of 4 years old and 6 years old.

          Once Dorame enters a guilty plea to the criminal charges, he will face a statutory maximum sentence of life imprisonment and a mandatory minimum sentence of 15 years in federal prison.

          The FBI is investigating this matter.

          Assistant United States Attorneys Kathy Yu and Scott M. Lara of the Violent and Organized Crime Section are prosecuting this case.

          Any member of the public who has information related to this matter is encouraged to contact the FBI’s Los Angeles Field Office at 1-800-CALL-FBI (1-800-225-5324).

          LOS ANGELES – A former San Gabriel Valley resident who ran Los Angeles County-based investment companies and was a frequent guest on financial television news programs was charged today in a federal criminal complaint alleging he lied to investors.

          James Arthur McDonald Jr., 50, formerly of Arcadia and who is believed to be in hiding, is charged with one count of securities fraud, a crime punishable by up to 20 years in federal prison.

          According to an affidavit filed with the complaint, McDonald frequently appeared as an analyst on the CNBC financial TV news network and was the CEO and chief investment officer of two companies: Hercules Investments LLC, based in downtown Los Angeles, and Index Strategy Advisors Inc. (ISA), based in Redondo Beach.

          In late 2020, McDonald lost tens of millions of dollars of Hercules client money after adopting a risky short position that effectively bet against the health of the United States economy in the aftermath of the U.S. presidential election. McDonald projected that the COVID-19 pandemic and the election would result in major selloffs that would cause the stock market to drop. When the market decline didn’t occur, Hercules clients lost between $30 million and $40 million, according to the affidavit. By December 2020, Hercules clients were complaining to company employees about the losses in their accounts.

          Since McDonald’s compensation for his investment advisory services primarily was based on a percentage of assets under his management – typically 2% of a client’s total assets held by Hercules – the massive losses to Hercules clients significantly decreased the fees McDonald was entitled to collect.

          In early 2021, McDonald solicited millions of dollars' worth of funds from investors in the form of a purported capital raise for Hercules but misrepresented how the funds would be used and failed to disclose the massive losses Hercules previously sustained. McDonald – an avid football enthusiast – stated that he planned to launch a publicly traded mutual fund under the ticker symbol “NFLHX.” The losses to Hercules clients and the potential for litigation related to those losses jeopardized the success of that fund because any litigation would have had to be publicly disclosed.

          As part of the capital raise, McDonald obtained $675,000 in investment funds from one victim group on March 9, 2021. He then misappropriated those funds in various ways, including spending roughly $174,610 of them at a Porsche dealership. Approximately $109,512 was transferred to the landlord of a home McDonald was renting in Arcadia; and approximately $6,800 was spent on a website that sells designer menswear.

          McDonald allegedly also falsely represented to clients that ISA, his other firm, was a registered investment adviser, even though he had withdrawn ISA as a state-registered investment adviser firm in May 2019. He also allegedly sent ISA clients false account statements, including for one client who invested approximately $351,000, later needed the money to make a down payment on a home, was informed by McDonald that much of the money had been lost, and never got his full investment back.

          The United States Securities and Exchange Commission subpoenaed McDonald to testify before it in November 2021, but – without advance notice – he failed to appear as required. According to the complaint, McDonald also appears to have terminated his previous phone and email accounts and told one person that he planned to “vanish.”

          Anyone with information about McDonald’s whereabouts is encouraged to call the FBI’s Los Angeles Field Office at (310) 477-6565.

          A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          The FBI and IRS Criminal Investigation investigated this matter. The SEC filed a civil complaint today charging McDonald and Hercules with violations of federal securities law.

          Assistant United States Attorneys Carolyn S. Small and Alexander B. Schwab of the Major Frauds Section are prosecuting this case.

          LOS ANGELES – A Paramount-based clothing wholesale company has agreed to plead guilty to federal criminal charges for undervaluing imported garments in a scheme to avoid paying almost $6.4 million in customs duties and for doing business with a woman in Mexico who has ties to the Sinaloa drug cartel, the Justice Department announced today.

          Ghacham Inc., which does business under the “Platini” brand name, is charged in a two-count information with conspiracy to pass false and fraudulent papers through a customhouse and conspiracy to engage in any transaction or dealing in properties of a specially designated narcotics trafficker under a statute known as the Foreign Narcotics Kingpin Designation Act.

          Also charged today is Mohamed Daoud Ghacham, 38, of Bell, a Ghacham Inc. executive who is charged with one count of conspiracy to pass false and fraudulent papers through a customhouse. Both defendants also signed plea agreements filed today in United States District Court and are expected to make their initial court appearances on November 18.

          According to court documents, Ghacham Inc. imported clothing from China and submitted fraudulent invoices to United States Customs and Border Protection (CBP) that undervalued the shipments, allowing it to avoid paying the full amount of tariffs owed on the imports.

          At Mohamed Ghacham’s direction, the Chinese suppliers prepared two invoices for the clothing ordered by Ghacham Inc. – a true invoice, which reflected the actual price paid for the goods, and a fraudulent “customs invoice,” which reflected an understated price. Ghacham Inc. submitted the customs invoices to CBP and customs brokers to fraudulently reduce the tariffs owed on the imports, while it maintained the true invoices in its accounting records.

          Ghacham Inc. and Mohamed Ghacham admitted that, between July 2011 and February 2021, they undervalued imported garments by more than $32 million and failed to pay customs duties approximately $6,390,792.

          Ghacham Inc. also illegally conducted business with Maria Tiburcia Cazarez Perez in violation of the Kingpin Act, which prohibits people and businesses in the United States from doing business with her. Cazarez Perez was previously designated a “Specially Designated Narcotics Traffickers” under the Kingpin Act for her participation in the financial network of Ismael “El Mayo” Zambada Garcia and Victor Emilio Cazares Salazar, two leaders of the Mexico-based Sinaloa Cartel. Cazares Salazar was sentenced to 15 years in federal prison for drug trafficking activities in federal cases out of San Diego and New York City.

          Upon entering guilty pleas, Ghacham Inc. will face a statutory maximum penalty of a $10.5 million fine and five years’ probation – during which time it will be required to implement an effective anti-money laundering compliance and ethics program with an outside compliance monitor, and Mohamed Ghacham will face up to five years in federal prison.

          Homeland Security Investigations and CBP investigated this matter. The U.S. Department of Commerce Office of Export Enforcement, Treasury Department’s Office of Foreign Assets Control, and IRS Criminal Investigation provided significant assistance.

          Assistant United States Attorneys Alexander B. Schwab of the Major Frauds Section and Diana L. Pauli of the International Narcotics, Money Laundering, and Racketeering Section are prosecuting the case.

          This case 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.

          LOS ANGELES – A Willowbrook man pleaded guilty today to federal criminal charges for robbing three banks during a six-day crime spree while he was on supervised release for bank robbery convictions over a decade ago.

          Rickey Lewis, 53, pleaded guilty to three counts of bank robbery and one count of attempted bank robbery.

          According to his plea agreement, from January 22 to January 28, 2019, Lewis stole a total of $4,035 in cash by robbing two JPMorgan Chase bank branches in Gardena and an International City Bank branch in Long Beach. Lewis also attempted to rob a Bank of America branch in Downey.

          During the robberies, Lewis threatened to shoot bank tellers – though it was not apparent that he was carrying a firearm – and he had clear tape on his fingers. In fear for their lives, the bank tellers handed over the cash.

          According to an affidavit filed with a criminal complaint in this case, law enforcement recovered a partial palm print recovered from the Long Beach bank robbery that matched Lewis’ palm print.

          While he committed the January 2019 bank robbery spree, Lewis was on supervised release for bank robbery convictions he sustained after he pleaded guilty in February 2006 to a month-long spree in which he robbed six banks in South Los Angeles and Inglewood.

          United States District Judge Christina A. Snyder scheduled a January 23, 2023 sentencing hearing, at which time he will face a statutory maximum sentence of 20 years in federal prison for each count.

          The FBI investigated this matter with the assistance of the Long Beach Police Department, the Downey Police Department, the Gardena Police Department, and the Los Angeles County Sheriff’s Department.

          Assistant United States Attorneys Patrick Castañeda of the International Narcotics, Money Laundering, and Racketeering Section and Kevin J. Butler of the Violent and Organized Crime Section are prosecuting this case.