Central District of California

            LOS ANGELES – Federal authorities have arrested a Redondo Beach man on charges of producing child pornography, allegedly by developing a relationship with at least one boy in the Philippines who performed sex acts online in exchange for money.

            Billy Frederick, 51, was arrested Wednesday morning without incident by special agents with Homeland Security Investigations. During his initial court appearance late Wednesday afternoon, a United States magistrate judge ordered Frederick jailed without bond pending trial. The criminal complaint naming Frederick was unsealed this afternoon.

            According to the complaint filed on June 22, Frederick stored in his Google accounts various images and videos depicting child pornography, at least some of which he obtained from video calls on Google Hangout. The affidavit in support of the complaint details one video from July 2020 in which a boy, who appears to be between 11 and 14 years old, engages in sexual activity while Frederick records the video call. In messages sent relating to the video call, the victim calls Frederick “master.”

            The investigation also uncovered chats between Frederick and the victim prior to the video call in which the boy asks to borrow money to purchase underwear. Immediately after the call, Frederick chatted online with the boy, who asked for money to be sent to his brother.

            The affidavit outlines other online chats from 2020 between Frederick and a person claiming to be relative of the victim seen on the Google Hangout video. In one chat, after telling Frederick that the victim had broken his leg and required medical aid, the relative wrote, “we’re just poor so I agree to my [relative] for what his doing,” according to the affidavit.

            During a search of one of Frederick’s online accounts, “I discovered many CSAM [child sexual abuse material] images of young nude male minors ranging from approximately 6 years of age to 15 years of age,” according to the affidavit by an HSI special agent. “Further, I discovered messages where Frederick would discuss the solicitation of CSAM of young boys, including enticement to engage in sexually explicit activity.”

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

            Frederick is charged with production of child pornography for transportation into the United States, an offense that carries a mandatory minimum sentence of 15 years in federal prison and a statutory maximum penalty of 30 years.

            Frederick is scheduled to be arraigned in this case on July 22.

            Homeland Security Investigations is investigating this matter.

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

The Department of Justice announced today that the Western Union Remission Fund began its third distribution of approximately $66 million in funds forfeited to the United States from the Western Union Company (Western Union) to approximately 6,000 victims located in the United States and abroad. These victims, many of whom were elderly victims of consumer fraud, will be recovering the full amount of their losses.

This is the third in a series of distributions. The first two distributions paid more than $300 million to over 142,000 victims, all of whom received full compensation for their losses. The Department of Justice anticipates authorizing compensation for more victims in the coming months. Petitions are accepted on an ongoing basis and potential victims who have not applied for compensation will be provided the opportunity to apply this year.

“This third distribution of funds from the Western Union forfeiture demonstrates the Department of Justice’s continued commitment to compensate and serve justice to victims, many of whom suffered immense losses from this fraud scheme,” said Deputy Assistant Attorney General Kevin O. Driscoll of the Justice Department’s Criminal Division. “Divesting criminals of ill-gotten gains and returning those funds to victims are the primary goals of the Asset Forfeiture Program, which has provided over $10 billion in forfeited funds to victims over the last two decades.”

“Since 2001, our office, in conjunction with the U.S. Postal Inspection Service, has been at the forefront of investigating and prosecuting cross-border frauds where global money services companies such as Western Union facilitate fraud by transferring millions of dollars overseas into the pockets of international fraudsters,” said Acting U.S. Attorney Bruce D. Brandler for the Middle District of Pennsylvania. “The historic 2017 deferred prosecution agreement with Western Union, and the payments to thousands of victims to compensate them for their losses, demonstrates our commitment to hold all responsible parties accountable and to make all victims whole. I want to thank all the prosecutors and agents who continue to work tirelessly on behalf of the victims.”

“Today’s $66 million distribution continues our commitment to ensuring justice for the thousands of victims who were financially harmed by multiple fraud schemes in this investigation,” said Postal Inspector in Charge Damon Wood of the U.S. Postal Inspection Service’s Philadelphia Division. “We are pleased that thus far over $350 million has been returned to approximately 150,000 victims, many who are among the most vulnerable: the elderly.  The U.S. Postal Inspection Service is dedicated to protect Americans and to ensure that all remedies are explored in delivering justice.”

In 2017, Western Union entered into a deferred prosecution agreement (DPA) with the United States. Pursuant to the DPA, Western Union had a criminal information filed against it acknowledged responsibility for its criminal conduct, which included violations of the Bank Secrecy Act and aiding and abetting wire fraud, and agreed to forfeit $586 million, which has been made available to compensate victims of an international consumer fraud scheme. Western Union simultaneously resolved a parallel civil investigation with the Federal Trade Commission.

According to court documents, in the scheme, fraudsters targeted consumers, including seniors, through multiple scams. Three specific scams directed towards seniors included the so-called grandparent scam, where the fraudster would pose as the victim’s relative in purported need of immediate money to avoid personal harm; lottery or sweepstakes scams, where the fraudster would tell the victim that he or she had won a large cash prize but had to pay fees, such as taxes, to claim the prize; and romance scams, where the fraudster would pose as an online love interest and request funds for a visit or for another purpose. In each of these scams, the fraudsters convinced their victims to send money through Western Union.

Certain owners, operators or employees of Western Union locations were complicit in the scheme. Western Union aided and abetted the scheme by failing to suspend or terminate complicit agents and by allowing them to continue to process fraud-induced monetary transactions. Western Union fulfilled its obligations under the DPA, and the court granted the motion to dismiss the criminal information against Western Union last year.

The Department of Justice, through the Asset Forfeiture Program, works diligently to restore lost funds to victims of crime and acknowledges the significant assistance of the U.S. Postal Inspection Service Philadelphia Division’s Harrisburg, Pennsylvania Office. The victim compensation payments in this case would not have been possible without the extraordinary efforts of the Criminal Division’s Money Laundering and Asset Recovery Section, and the U.S. Attorneys’ Offices for the Middle District of Pennsylvania, the Central District of California, the Eastern District of Pennsylvania, and the Southern District of Florida. The FBI’s Los Angeles Field Office, IRS-Criminal Investigation, U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations, the Federal Reserve Board, the Consumer Financial Protection Bureau Office of Inspector General, and the Department of the Treasury Office of Inspector General provided valuable assistance.

More information about the Western Union compensation process is available on the Western Union remission website at www.westernunionremission.com. Further questions may be directed to the Western Union Remission Administrator by phone at 844-319-2124 or by email at info@WesternUnionRemission.com.

The Department of Justice announced today that the Western Union Remission Fund began its third distribution of approximately $66 million in funds forfeited to the United States from the Western Union Company (Western Union) to approximately 6,000 victims located in the United States and abroad. These victims, many of whom were elderly victims of consumer fraud, will be recovering the full amount of their losses.

This is the third in a series of distributions. The first two distributions paid more than $300 million to over 142,000 victims, all of whom received full compensation for their losses. The Department of Justice anticipates authorizing compensation for more victims in the coming months. Petitions are accepted on an ongoing basis and potential victims who have not applied for compensation will be provided the opportunity to apply this year.

“This third distribution of funds from the Western Union forfeiture demonstrates the Department of Justice’s continued commitment to compensate and serve justice to victims, many of whom suffered immense losses from this fraud scheme,” said Deputy Assistant Attorney General Kevin O. Driscoll of the Justice Department’s Criminal Division. “Divesting criminals of ill-gotten gains and returning those funds to victims are the primary goals of the Asset Forfeiture Program, which has provided over $10 billion in forfeited funds to victims over the last two decades.”

“Since 2001, our office, in conjunction with the U.S. Postal Inspection Service, has been at the forefront of investigating and prosecuting cross-border frauds where global money services companies such as Western Union facilitate fraud by transferring millions of dollars overseas into the pockets of international fraudsters,” said Acting U.S. Attorney Bruce D. Brandler for the Middle District of Pennsylvania. “The historic 2017 deferred prosecution agreement with Western Union, and the payments to thousands of victims to compensate them for their losses, demonstrates our commitment to hold all responsible parties accountable and to make all victims whole. I want to thank all the prosecutors and agents who continue to work tirelessly on behalf of the victims.”

“Today’s $66 million distribution continues our commitment to ensuring justice for the thousands of victims who were financially harmed by multiple fraud schemes in this investigation,” said Postal Inspector in Charge Damon Wood of the U.S. Postal Inspection Service’s Philadelphia Division. “We are pleased that thus far over $350 million has been returned to approximately 150,000 victims, many who are among the most vulnerable: the elderly.  The U.S. Postal Inspection Service is dedicated to protect Americans and to ensure that all remedies are explored in delivering justice.”

In 2017, Western Union entered into a deferred prosecution agreement (DPA) with the United States. Pursuant to the DPA, Western Union had a criminal information filed against it and acknowledged responsibility for its criminal conduct, which included violations of the Bank Secrecy Act and aiding and abetting wire fraud, and agreed to forfeit $586 million, which has been made available to compensate victims of an international consumer fraud scheme. Western Union simultaneously resolved a parallel civil investigation with the Federal Trade Commission.

According to court documents, in the scheme, fraudsters targeted consumers, including seniors, through multiple scams. Three specific scams directed towards seniors included the so-called grandparent scam, where the fraudster would pose as the victim’s relative in purported need of immediate money to avoid personal harm; lottery or sweepstakes scams, where the fraudster would tell the victim that he or she had won a large cash prize but had to pay fees, such as taxes, to claim the prize; and romance scams, where the fraudster would pose as an online love interest and request funds for a visit or for another purpose. In each of these scams, the fraudsters convinced their victims to send money through Western Union.

Certain owners, operators or employees of Western Union locations were complicit in the scheme. Western Union aided and abetted the scheme by failing to suspend or terminate complicit agents and by allowing them to continue to process fraud-induced monetary transactions. Western Union fulfilled its obligations under the DPA, and the court granted the motion to dismiss the criminal information against Western Union last year.

The Department of Justice, through the Asset Forfeiture Program, works diligently to restore lost funds to victims of crime and acknowledges the significant assistance of the U.S. Postal Inspection Service Philadelphia Division’s Harrisburg, Pennsylvania, Office. The victim compensation payments in this case would not have been possible without the extraordinary efforts of the Criminal Division’s Money Laundering and Asset Recovery Section, and the U.S. Attorneys’ Offices for the Middle District of Pennsylvania, the Central District of California, the Eastern District of Pennsylvania and the Southern District of Florida. The FBI’s Los Angeles Field Office, IRS-Criminal Investigation, Homeland Security Investigations, the Federal Reserve Board, the Consumer Financial Protection Bureau Office of Inspector General and the Department of the Treasury Office of Inspector General provided valuable assistance.

More information about the Western Union compensation process is available on the Western Union remission website at www.westernunionremission.com. Further questions may be directed to the Western Union Remission Administrator by phone at 844-319-2124 or by email at info@WesternUnionRemission.com.

            LOS ANGELES – A federal grand jury today returned an 11-count indictment that alleges a Santa Barbara man stole approximately $12 million from victims who were promised their money would be used to purchase annuities from Swiss insurance companies.

            Darrell Arnold Aviss, 63, of Santa Barbara, was charged today with five counts of wire fraud and six counts of money laundering. Aviss was arrested June 18 pursuant to a criminal complaint, and he was subsequently ordered held without bond.

            According to the indictment filed this afternoon in United States District Court, Aviss ran the scheme from at least 2012 through last summer, 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 allegedly told victims the annuities would pay interest rates ranging from 5 to 7 percent.

            But, the indictment alleges, Aviss did not use the victims’ money to purchase annuities, even though he arranged for the victims to receive 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 $12 million, with most of that money coming from just one victim, according to court documents. Some money was paid back to victims to keep the scheme running.

            Instead of purchasing annuities, Aviss allegedly used the victims’ money for his own purposes and to support his lavish lifestyle. Court documents indicate that he used the money for, among other things, Ponzi payments to victims, mortgage payments, luxury car leases, expensive watches, trips to Monaco, more than $100,000 in purchases at a Santa Barbara nightclub, and 20 tickets to a U2 concert and after-party.

            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.

            Aviss is scheduled to be arraigned in this case on July 9.

            The indictment charges Aviss with five counts of wire fraud, each of which carries a statutory maximum sentence of 20 years in federal prison; one count of concealment money laundering, which has a maximum sentence of 20 years; and five counts of laundering criminal proceeds in excess of $10,000, each of which carries a potential sentence of 10 years.

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

            Assistant United States Attorney Monica E. Tait of the Major Frauds Section is prosecuting this case.

            If you or someone you know is age 60 or older and has been a victim of financial fraud, help is standing by at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This U.S. 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 from 10 a.m. until 6 p.m. Eastern Time, Monday through Friday. In addition to English, Spanish and other languages are available to callers.  

          LOS ANGELES – A San Gabriel Valley man pleaded guilty today to federal criminal charges for participating in a multimillion-dollar scheme to manufacture and ship counterfeit laptop computer batteries and other electronics from China to the United States, where the bogus batteries were sold to unsuspecting buyers in online marketplaces.

          Zoulin Cai, a.k.a. “Allen Cai,” 29, of La Puente, pleaded guilty to one count of conspiracy to commit wire fraud and mail fraud and one count of aggravated identity theft.

          According to his plea agreement, Cai conspired to import batteries, labels for batteries in laptop computers, cellphones, and other electronics from China to the United States. Cai then sold and shipped the counterfeit batteries to unsuspecting individual buyers via eBay and Amazon, falsely advertising them as brand-name new, genuine, original, or OEM (original equipment manufacturer) products. Those batteries bore counterfeit trademarks of companies such as Apple, Dell, HP and Toshiba, as well as counterfeit certification marks of UL, a company that tests and certifies the safety of electronic products.

          Counterfeit lithium-ion laptop batteries pose significant safety risks – including the risk of extreme heat, fire and explosions – and the batteries that Cai and his co-conspirators shipped frequently lacked required and essential internal safeguards.

          Cai and his co-conspirators established numerous U.S.-based corporations to facilitate the importation and sale of counterfeit lithium-ion batteries and other electronic accessories for laptop computers and cellular telephones.

          Co-conspirators in China packaged counterfeit batteries and electronics and shipped them to the United States, sometimes covering the trademarks with black tape or a similar material, so that a quick inspection of the items by customs officials would not reveal the trademark. The counterfeit batteries were imported, sold and shipped from Cai-controlled warehouses in La Puente.

          In December 2019, Cai’s warehouse (including containers on the premises) contained approximately 44,000 batteries, as well as approximately 175,000 labels, bearing the counterfeit marks of multiple companies, including Apple, Dell, HP, Toshiba, Lenovo, Asus, Acer and Samsung, according to the plea agreement.

          Cai admitted that from March 2014 to June 2019, he and his co-conspirators fraudulently obtained approximately at least $3.5 million and as much as $23,831,668 from the sale of laptop batteries through eBay and Amazon. During that time, Cai and his co-conspirators sent approximately $18,094,960 through wire transfers from U.S.-based bank accounts that they owned and controlled directly to Chinese bank accounts.

          United States District Judge John F. Walter has scheduled an October 4 sentencing hearing, at which time Cai will face a statutory maximum sentence of 22 years in federal prison.

          Homeland Security Investigations investigated this matter and was assisted in this investigation by the brand-holding companies.

          Assistant United States Attorney Julia S. Choe of the General Crimes Section and Assistant United States Attorney Khaldoun Shobaki of the Cyber and Intellectual Property Crimes Section are prosecuting this case.

          LOS ANGELES – An accountant was sentenced today to 51 months in federal prison for running a four-year, $3.3 million Ponzi scheme that conned dozens of investors through false promises of generous returns on foreign exchange currency investments and was funded, in part, by his embezzlement from his non-profit employer.

          Steven F. Brown, 53, of Marina del Rey, was sentenced by United States District Judge Philip S. Gutierrez, who also ordered Brown to pay $3,313,346 in restitution. Brown pleaded guilty in October 2020 to one count of wire fraud.

          Brown controlled and operated Alpha Trade Analytics, Inc., a financial consulting-and-investment company he largely ran out of his home. Neither Brown nor Alpha Trade was a registered broker or dealer in securities. Brown also served as the accountant for a non-profit organization providing dance and theater arts education to children and young adults in Los Angeles, which gave him access to its bank accounts.

          From April 2014 to May 2018, Brown solicited investments in Alpha Trade, including from people he encountered through his position at the non-profit, and through his relationship with its executives and employees, which afforded him access to high-net worth individuals.

          To encourage those individuals to invest with Alpha Trade, Brown falsely promised that their investments would only be used for foreign exchange (Forex) currency trading and that they would receive guaranteed monthly payouts of around 10%. He also falsely represented that he had extensive experience in Forex investing, regularly made profitable trades, and achieved substantial and growing rates of return that exceeded the industry average.

          Contrary to his representations to investors, Brown only used a small portion of the total amount invested in Alpha Trade for Forex trading, mostly in 2015. Instead, he routinely used investor funds for other purposes, including his rent, car payments, restaurant and retail expenses, and lulling payments to other investors.

          To induce investors to maintain or supplement their investments with Alpha Trade and to conceal his scheme, Brown periodically provided investors with account statements that reflected fabricated investment returns that often showed steady, significant gains.

          Brown made some of the promised recurring payouts and provided demanded refunds, not based on any Forex investment returns, but instead from money stolen from new investors and through funds he embezzled from the dance academy through unauthorized wire transfers, credit card advances and cash withdrawals he was able to make by virtue of his position as the dance academy’s accountant.

          In total, Brown caused losses of approximately $3,313,346 to 48 victims, including nearly $700,000 in losses to his former employer based on the money he embezzled from it.

          The Securities and Exchange Commission in September 2020 filed a lawsuit against Brown alleging violations of federal securities laws. That litigation is pending.

          The FBI investigated this matter.

          Assistant United States Attorney Kristen A. Williams of the Major Frauds Section prosecuted this case.

          LOS ANGELES – A federal jury has found four Los Angeles-area residents guilty of criminal charges for scheming to submit fraudulent loan applications seeking millions of dollars in Paycheck Protection Program (PPP) and Economic Injury Disaster Loan (EIDL) COVID-19 relief funds.

          At the conclusion of an eight-day trial, the following defendants were found guilty on June 25:

• Richard Ayvazyan, 42, of Encino;
• Richard Ayvazyan’s wife, Marietta Terabelian, 37, of Encino;
• Richard Ayvazyan’s brother, Artur Ayvazyan, 41, of Encino;
• Vahe Dadyan, 41, of Glendale.

          All four defendants were found guilty of one count of conspiracy to commit bank fraud and wire fraud, 11 counts of wire fraud, eight counts of bank fraud and one count of conspiracy to commit money laundering. Richard Ayvazyan also was found guilty of two counts of aggravated identity theft. Artur Ayvazyan also was found guilty of one count of aggravated identity theft. Vahe Dadyan also was found guilty of one count of money laundering.

          On June 28, the jury found the defendants must forfeit bank accounts, jewelry, watches, gold coins, three residential properties and approximately $450,000 in cash.

          According to the evidence presented at trial, the defendants used fake, stolen and synthetic identities – including the created identities of “Iuliia Zhadko” and “Viktoria Kauichko” – to submit fraudulent applications for PPP and EIDL loans guaranteed by the Small Business Administration (SBA) under federal law. In support of the fraudulent applications, the defendants often submitted false and fictitious documents to lenders and the SBA, including fake identity documents, tax documents and payroll records.

          The defendants then used the fraudulently obtained funds as down payments on luxury homes in Tarzana, Glendale and Palm Desert. They also used the funds to buy gold coins, diamonds, jewelry, luxury watches, fine imported furnishings, designer handbags, clothing, and a Harley-Davidson motorcycle. The conspirators obtained more than $18 million in COVID-relief funds.

          United States District Judge Stephen V. Wilson has scheduled a September 13 sentencing hearing, at which time each defendant will face decades in federal prison.

          Prior to the verdict, the following defendants pleaded guilty to criminal charges in this case:

• Manuk Grigoryan, 46, of Sun Valley, pleaded guilty on June 7 to one count of bank fraud and one count of aggravated identity theft. Judge Wilson has scheduled a September 13 sentencing hearing, at which time Grigoryan will face a statutory maximum sentence of 32 years in federal prison.
• Edvard Paronyan, 40, of Granada Hills, pleaded guilty on June 11 to one count of wire fraud. He will face a statutory maximum sentence of 20 years in federal prison at his August 30 sentencing hearing.
• Tamara Dadyan, 39, of Encino, Artur Ayvazyan’s wife and Vahe Dadyan’s cousin, pleaded guilty on June 14 to one count of conspiracy to commit bank fraud and wire fraud, one count of aggravated identity theft and one count of conspiracy to commit money laundering. She will face up to 52 years in federal prison at her September 27 sentencing hearing.
• Arman Hayrapetyan, 41, of Glendale, pleaded guilty on June 21, to one count of conspiracy to commit money laundering. He will face up to 20 years in federal prison at his sentencing hearing, which is scheduled for September 20.

          “Seeking quick riches, the defendants stole federal funds intended to help Americans harmed by the COVID-19 pandemic and the economic carnage left in its wake,” said Acting United States Attorney Tracy L. Wilkison. “The verdicts in this case are the first in this district resulting from a pandemic-related fraud scheme, and we are prepared to bring additional defendants to justice as we continue our efforts to safeguard our nation’s disaster-relief programs.”

          The FBI, IRS Criminal Investigation, the Small Business Administration’s Office of Inspector General, and the Federal Housing Finance Agency – Office of Inspector General investigated this matter.

          Assistant United States Attorneys Scott Paetty and Catherine S. Ahn of the Major Frauds Section, Assistant United States Attorney Brian R. Faerstein of the Environmental and Community Safety Crimes Section, Assistant United States Attorney Daniel G. Boyle of the Asset Forfeiture Section, and Trial Attorney Christopher Fenton of the Fraud Section of the Justice Department’s Criminal Division are prosecuting this case.

          On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

          Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

            LOS ANGELES – A Mexican national, who was aboard a SkyWest Airlines flight taxiing to the runway at Los Angeles International Airport Friday evening, allegedly approached the cockpit – banging on the cockpit door and trying to enter the restricted space – before opening an emergency exit and jumping to the tarmac, according to a federal criminal complaint made public today.

            Luis Armando Victoria Dominguez, 33, of La Paz, Mexico, was charged with interference with flight crew members and attendants. Victoria Dominguez, who suffered a broken leg when he fell to the tarmac and later underwent surgery, is expected to make his initial appearance later this week in United States District Court.

            The complaint alleges that Victoria Dominguez was a passenger on United Airlines flight 5365, operated by SkyWest Airlines, that was scheduled to fly from Los Angeles to Salt Lake City. Soon after the plane pushed back from the gate, Victoria Dominguez “sprinted” to the front of the aircraft past a seated flight attendant and “began banging on the cockpit door and manipulating the locked doorknob,” according to an FBI affidavit that was filed with the complaint.

            When he failed to gain entry to the cockpit, Victoria Dominguez pushed past the flight attendant and went to the emergency exit on the right side of the plane, where he managed to partially open the door, causing the emergency slide to partially deploy, the affidavit states. While a nearby passenger attempted to restrain him, Victoria Dominguez managed to get away and jump from the aircraft, missing the emergency slide.

            “Once Victoria Dominguez landed on the tarmac, he began crawling away from the aircraft. His right leg appeared broken,” the affidavit states.

            A criminal 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 criminal complaint naming Victoria Dominguez was signed by a United States magistrate judge on Sunday and docketed by the court this afternoon.

            The charge of interference with flight crew members and attendants carries a statutory maximum penalty of 20 years in federal prison.

            The FBI is investigating this matter and received substantial assistance from the Los Angeles Airport Police Department.

            Assistant United States Attorney Solomon Kim of the General Crimes Section is prosecuting this case.

          LOS ANGELES – The Justice Department today reached a settlement under Title II of the Americans with Disabilities Act (ADA) with San Luis Obispo County to ensure that inmates with mobility disabilities have an equal opportunity to participate in San Luis Obispo Jail’s (SLO Jail) programs, services and activities.

          Based on its investigation, the United States determined that SLO Jail facilities were inaccessible to inmates with mobility disabilities and denied them equal access to the jail’s programs, services and activities. San Luis Obispo County fully cooperated with the investigation and indicated a commitment to remedying barriers to equal access.

          “People with mobility disabilities are entitled to have access to cells and showers they can safely use while incarcerated,” said Acting United States Attorney Tracy L. Wilkison. “San Luis Obispo County has taken important steps to ensure that the facilities at its jail are in compliance with the ADA.”

          “Jails and prisons across our country must ensure that their facilities are accessible to people with disabilities. Compliance with the Americans with Disabilities Act ensures that inmates with disabilities have equal access to basic necessities, such as showers and sleeping areas, and to all activities that are offered to inmates without disabilities,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “We commend the County for recognizing its obligations and working with the Department of Justice to bring the facilities at its jail into compliance with the law.”

          Under the ADA, governmental entities that operate jails or prisons must make changes necessary to ensure that inmates with mobility disabilities do not serve time in a manner that is more difficult, or less safe, than those without disabilities.

          The Justice Department opened its investigation after receiving a complaint by a former inmate at SLO Jail who has a mobility disability and uses a prosthetic leg. The inmate alleged that SLO Jail failed to provide him with an accessible cell or shower, causing him to fall repeatedly and, in one instance, to break his leg. The complainant also alleged that, because of his disability, SLO Jail denied him equal opportunities for recreation and other programs, leading him to experience unnecessary isolation.

          Under the agreement, SLO Jail will make architectural changes to its facilities to ensure that they are accessible to inmates with disabilities. The jail will also train relevant staff, designate an ADA coordinator and implement an ADA complaint procedure. In addition, the jail will pay $175,000 to the complainant to compensate him for his pain and suffering.

          For more information about the ADA and today’s agreement, please visit https://www.ada.gov/ or call the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY). ADA complaints may be filed online at https://www.ada.gov/file-a-complaint/.

          SANTA ANA, California – Twin brothers – both former Orange County sheriff’s deputies – pleaded guilty today to federal charges and admitted that they defrauded Orange County taxpayers by submitting approximately two dozen fraudulent military orders to obtain military leave from the Sheriff’s Department so they would not be docked vacation days.

          Taylor Morgan, 26, and Tyler Morgan, 26, both of Long Beach, each pleaded guilty in separate hearings to a single-count information charging them with unlawful possession of an authentication feature of the United States, a misdemeanor offense.

          United States Magistrate Judge Autumn D. Spaeth sentenced each defendant to one year of probation. Taylor Morgan further was sentenced to six months of home detention and ordered to pay $14,000 in restitution while Tyler Morgan was sentenced to eight months of home detention and was ordered to pay $32,400 in restitution.

          According to their plea agreements, Tyler Morgan was employed as a correctional service assistant and deputy with the Orange County Sheriff’s Department (OCSD) from August 2015 to January 2021. Taylor Morgan had the same job titles with OCSD from January 2017 to January 2020. Both men also were in reserve units for the United States Marine Corps in Camp Pendleton.

          As part of their employment with OCSD, the defendants received 30 days of leave per year that could be used for vacations, military leave and other personal reasons. In addition to such leave, the defendants received an additional 30 days of leave per year when they had to fulfill their active duty obligations with their reserve units with the Marine Corps, including annual training.

          From June 2017 to November 2019, Tyler Morgan submitted 24 fraudulent military orders to OCSD to obtain military leave from the department. From May 2017 to January 2020, Taylor Morgan submitted 25 fraudulent military orders to OCSD to obtain military leave from the department. In fact, neither had been ordered by the Marine Corps to fulfill active duty obligations with their reserve units.

          Both defendants admitted that they defrauded the County of Orange to obtain wages paid for military leave by committing wire fraud using the fraudulent military orders. The defendants altered orders that appeared to be official notices requiring them to serve active duty at Camp Pendleton. The fraudulent orders appeared to have been authorized by a Marine Corps official and had the Department of Defense’s seal on them.

          The defendants submitted the fraudulent orders to OCSD’s Professional Standard Division so they would receive military leave from the county on the dates listed on the orders and their vacation days would not be used. In most instances, the defendants were at inactive duty training (also known as drill), which OCSD did not compensate for military leave.

          In at least one instance, Tyler Morgan did not inform OCSD that he was at drill or that the dates of his drill duties had changed, causing the County of Orange to incorrectly compensate him as if he had been on active duty. Tyler Morgan admitted to submitting a fraudulent military order that appeared to be from the Marine Corps requiring him to be on active duty for one week in late July 2019. In fact, he was on active duty for only part of that time period. Tyler Morgan did not inform OCSD that, during that week, he was also on drill, took a trip to Las Vegas, and spent one day at home playing the “Call of Duty” video game.

          In total, Taylor Morgan received 48 days of military leave to which he was not entitled, resulting in a loss of $14,000 to the County of Orange. Tyler Morgan received 64 days of fraudulently obtained military leave, resulting in a loss of $32,400 to the County.

          The FBI and the United States Department of Defense – Office of Inspector General investigated this matter. The Orange County Sheriff’s Department provided substantial assistance.

          Assistant United States Attorney Vibhav Mittal of the Santa Ana Branch Office prosecuted these cases.

          LOS ANGELES – Federal authorities have arrested two Illinois residents named in an indictment that accuses five defendants of conspiring to unlawfully export to Russia defense articles – specifically, thermal imaging riflescopes and night-vision goggles – without a license in violation of the Arms Export Control Act.

          The indictment also accuses all five defendants of conspiring to smuggle thermal imaging devices from the United States and file false export information to conceal their activities.

          The indictment, which was returned by a federal grand jury on May 26 and unsealed following the arrests on June 17, outlines a nearly four-year scheme in which the defendants purchased dozens of thermal imaging devices – most of which cost between $5,000 and $10,000 and are controlled by the International Traffic in Arms Regulations – from sellers across the United States.

          The defendants allegedly obtained many of the items using aliases, falsely assuring the sellers that they would not export the items from the United States. The thermal imaging devices were then exported to co-conspirators in Russia using aliases and false addresses to conceal their activities, according to the indictment.

          The defendants hid the thermal imaging devices among other non-export-controlled items when exporting them to Russia, and they falsely stated on export declarations that the contents of their exports were non-export-controlled items with values of less than $2,500, the indictment alleges. In no case did any of the defendants obtain the required export licenses to export defense articles to Russia.

          The two defendants arrested on June 17 in Illinois are Elena Shifrin, 59, of Mundelein, Illinois, and Vladimir Pridacha, 55, of Volo, Illinois. These two defendants made their initial court appearances last week in the United States District Court in Chicago and were released on $100,000 bond.

          The other three defendants named in the indictment are: Boris Polosin, of Russia; Vladimir Gohman, of Israel, and Igor Panchernikov, an Israeli citizen who, during much of the scheme, resided in Corona, California.

          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 charge of conspiring to violate the Arms Export Control Act carries a statutory maximum penalty of 20 years in federal prison. The second conspiracy charge alleged in the indictment carries a statutory maximum penalty of five years in prison.

          The FBI’s Los Angeles and Chicago field offices investigated this matter, with substantial assistance from the United States Postal Inspection Service and Homeland Security Investigations.

          Assistant United States Attorneys David T. Ryan and Wilson Park of the Terrorism and Export Crimes Section and Justice Department Trial Attorney Matthew Chang of the National Security Division’s Counterintelligence and Export Control Section are prosecuting this case.

A federal grand jury in Los Angeles unsealed an indictment Thursday that accuses five defendants of conspiring to unlawfully export defense articles to Russia. Specifically, the defendants allegedly exported thermal imaging riflescopes and night-vision goggles without a license, in violation of the Arms Export Control Act.

According to court documents, Elena Shifrin, 59, of Mundelein, Illinois, and Vladimir Pridacha, 55, of Volo, Illinois, were arrested June 17 for their roles in a nearly four-year scheme in which the defendants purchased dozens of thermal imaging devices, most of which cost between $5,000 and $10,000 and are controlled by the International Traffic in Arms Regulations, from sellers across the United States. The other three defendants named in the indictment are: Boris Polosin, 45, of Russia; Vladimir Gohman, 52, of Israel; and Igor Panchernikov, 39, an Israeli national who, during much of the scheme, resided in Corona, California.

As outlined in the indictment, the defendants allegedly obtained many of the items using aliases, falsely assuring the sellers that they would not export the items from the United States. The thermal imaging devices were then exported to co-conspirators in Russia using aliases and false addresses to conceal their activities.

As alleged, the defendants hid the thermal imaging devices among other non-export-controlled items when exporting them to Russia, and they falsely stated on export declarations that the contents of their exports were non-export-controlled items with values of less than $2,500. In no case did any of the defendants obtain the required export licenses to export defense articles to Russia.

All five defendants are charged with conspiring to violate the Arms Export Control Act and face up to 20 years in federal prison if convicted. The indictment also accuses all five defendants of conspiring to smuggle thermal imaging devices from the United States and file false export information to conceal their activities, which carries a statutory maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting U.S. Attorney Tracy Wilkison of the Central District of California and Assistant Attorney General John C. Demers of the Justice Department’s National Security Division made the announcement.

The FBI’s Los Angeles and Chicago Field Offices are investigating the case, with valuable assistance provided by the U.S. Postal Inspection Service and Homeland Security Investigations.

Assistant U.S. Attorneys David T. Ryan and Wilson Park of the Central District of California and Trial Attorney Matthew Chang of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case.

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

          LOS ANGELES – A Michigan man was sentenced today to 30 months in federal prison for robbing a credit union – and two days later attempting to rob a bank then leading law enforcement on a high-speed pursuit that ended with him crashing his getaway car near Vandenberg Air Force Base.

          Maurice Antwion Pilgrim Jr., 20, of Detroit, was sentenced by United States District Judge Percy Anderson, who also ordered him to pay $748 in restitution. Pilgrim pleaded guilty on April 8 to one count of bank robbery.

          On October 13, 2020, Pilgrim robbed Coast Hills Credit Union in Lompoc, netting $3,000 in the theft. Two days later, Pilgrim attempted to rob Mechanics Bank in Guadalupe by handing one of the tellers a note which read, “give me $5,000-$10,000 and no gets hurt.” Pilgrim fled the scene after seeing a nearby bank security guard.

          After fleeing Mechanics Bank, local law enforcement spotted Pilgrim driving a car on Highway 1 and began pursuing him. After initially stopping his car, Pilgrim refused to exit the vehicle and, to avoid capture, sped away. During his subsequent flight from law enforcement he drove at speeds more than 110 mph, weaving in and out of traffic, and almost colliding with other motorists on the road.

          Pilgrim’s vehicle went off the road near the Vandenberg Air Force Base visitor center, and he attempted to flee on foot, but he was quickly apprehended. Law enforcement recovered $552 from Pilgrim’s car and $1,700 from his pockets that were proceeds of his robbery of Coast Hills Credit Union two days earlier.

          “(Pilgrim) attempted to commit a second bank robbery after the first was successful, and his reaction to getting caught represented a serious disregard for the safety of others, including the public at large,” prosecutors wrote in their sentencing memorandum.

          The FBI, the Lompoc Police Department, the Guadalupe Police Department, and the Santa Barbara County Sheriff’s Office investigated this matter.

          Assistant United States Attorney Lynda Lao of the General Crimes Section prosecuted this case.

            RIVERSIDE, California – An attorney with a law practice in Ontario was taken into federal custody today on a charge of producing child pornography that alleges he paid a teenaged girl to send him sexually explicit images.

            Sagi Schwartzberg, 38, of Fontana, was taken into custody by special agents with the FBI after the San Bernardino County District Attorney on Wednesday dismissed its child exploitation charges against him. Schwartzberg – who used the aliases “Jason D,” “drunkesq_o64” and “xocdrunkx” on social media platforms – is expected to be arraigned on the federal charge this afternoon in United States District Court in Riverside.

            Schwartzberg is named in a federal criminal complaint, filed on April 27 and unsealed today, that charges him with production of child pornography, an offense that carries a mandatory minimum sentence of 15 years in federal prison.

            Schwartzberg was arrested February 17 in the state case, approximately three months after the National Center for Missing and Exploited Children forwarded a tip from Kik, a mobile messaging application, to the Fontana Police Department. The tip indicated that a person later identified as Schwartzberg had uploaded suspected child pornography to Kik from two locations – later determined to be his residence and his law office – in October and November. The FBI later reviewed the videos, one of which depicts a girl who appears to be under the age of 10 being sexually assaulted, according to the affidavit in support of the complaint.

            During a search on February 17, Fontana Police officers seized Schwartzberg’s mobile phone, which had a hidden vault containing file folders, labeled with girls’ names, one of which contained sexually explicit images and videos of a girl who is now 15 years old, the affidavit alleges.

            During a subsequent interview with police officers outlined in the affidavit, the girl said she had been solicited by Schwartzberg to send sexually explicit images via SnapChat starting 2019 and that she had received electronic gift cards in exchange. The victim “reported that ‘Jason’ asked her to meet up with him for sex but she never agreed to it,” the affidavit states. “‘Jason’ also asked her to introduce him to her other friends but [the victim] claimed that she did not introduce him to any of her friends.”

            Fontana Police also identified another victim, currently 17 years old, who had sent images to Schwartzberg via SnapChat when she was 16, sometimes in response to specific instructions, according to the affidavit, which notes authorities have identified at least two other minor victims who also sent images to Schwartzberg.

            The FBI continues to work to identify other victims in this case. Anyone who may have information in this matter is encouraged to contact the FBI’s Los Angeles Field Office at 310-477-6565.

            This matter is being investigating by the FBI in conjunction with Fontana Police Department, as part of Inland Regional Child Exploitation and Human Trafficking Task Force. The Task Force also includes the Upland Police Department, the Rialto Police Department, the San Bernardino County Sheriff's Department, the Riverside County District Attorney’s Office, the Riverside County Sheriff’s Department and the Riverside Police Department.

            Assistant United States Attorney Sonah Lee of the Riverside Branch Office is prosecuting this case.

          LOS ANGELES – A Lynwood man was found guilty today of federal robbery charges for organizing and leading a crew that committed 15 armed robberies of independent, “mom-and-pop” pharmacies across Southern California, with the intent of illegally selling the stolen prescription medication.

          Tyrome Lewis, 26, a.k.a. “Boobie,” was found guilty of all eight felony charges he faced after a two-day bench trial in April. Lewis has been in federal custody since his arrest in July 2019.

          In a ruling issued today, United States District Judge John A. Kronstadt found Lewis guilty of one count of conspiracy to interfere with commerce by robbery, one count of conspiracy to distribute oxycodone, two counts of interference with commerce by robbery, two counts of possession with intent to distribute oxycodone, and two counts of knowingly using and brandishing a firearm during a crime of violence.

          According to the evidence presented at trial, from May 2018 to July 2019, Lewis conspired with others to commit 15 armed robberies. Lewis selected the pharmacies to be robbed, targeting smaller pharmacies to steal oxycodone and other similar prescription medication. He also assigned the roles from the crew members, and then he served as a lookout while co-conspirators committed the robberies. Following the pharmacy robberies, Lewis and others would sell the stolen prescription medication on the black market.

          The court found the Lewis-led armed crew – dubbed the “Oxy Bandits” by law enforcement – robbed pharmacies in Glendale, Bellflower, Paramount, Cerritos, Hawthorne, South Los Angeles, Pico Rivera, Huntington Park, Claremont, Westminster, Fullerton, Anaheim, and Riverside.

          Each of the robberies shared a common modus operandi, including targeting smaller pharmacies, placing the stolen prescription drugs into the pharmacy’s trash bags or trash cans, using a black semi-automatic handgun to threaten and intimidate store employees, and forcing employees to open the medication vault.

          Today’s guilty verdict of Lewis for his role in this series of armed pharmacy robberies is part of a broader investigation of armed pharmacy robberies resulting from a partnership between the FBI and the Los Angeles County Sheriff’s Department. Through this partnership, the United States Attorney’s Office has charged 21 individuals for their roles in various pharmacy robberies. Since the investigation began in 2019, 19 individuals, including Lewis, have been convicted for their participation in pharmacy robberies, while two defendants await trial.

          Judge Kronstadt has scheduled a September 23 sentencing hearing, at which time Lewis will face a statutory maximum sentence of life in federal prison.

          The FBI and the Los Angeles County Sheriff’s Department investigated this matter, with assistance from the Claremont Police Department and the Glendale Police Department.

          Assistant United States Attorneys Jeffrey M. Chemerinsky and Joseph D. Axelrad of the Violent and Organized Crime Section, and Assistant United States Attorney Peter Dahlquist of the Riverside Branch Office, prosecuted this case.

            LOS ANGELES – The United States has filed a complaint under the False Claims Act against a Vacaville company alleging one of its owners and seven skilled nursing facilities (SNFs) “systematically paid money to referring physicians…to induce those physicians to make patient referrals, in knowing and willful violation” of the federal Anti-Kickback Statute.

            The complaint in intervention, which was filed in United States District Court in Los Angeles late Monday, names as defendants Paksn Inc.; Prema Thekkek, one of its owners; and seven SNFs owned by Thekkek and/or operated by Paksn.

            The United States alleges that the defendants entered into medical directorship agreements with certain physicians that purported to provide compensation for administrative services, but in reality, were vehicles for the payment of kickbacks to induce the physicians to refer patients to the seven SNFs. The Anti-Kickback Statute prohibits offering or paying anything of value to encourage the referral of items or services covered by federal health care programs.

            Those seven SNFs are four facilities in Hayward – Bay Point Healthcare Center, Gateway Care & Rehabilitation Center, Hayward Convalescent Hospital, and Hilltop Care & Rehabilitation Center – as well as Martinez Convalescent Hospital, Park Central Care & Rehabilitation Hospital in Fremont, and Yuba Skilled Nursing Center.

            The United States specifically alleges that the defendants hired certain physicians who promised in advance to refer a large number of patients to the SNFs, paid physicians in proportion to the number of expected referrals and terminated physicians who did not refer enough patients.

            On one occasion, a Paksn employee told Thekkek that two physicians were being hired because “they are promising at least 10 patients for $2000 per month.” On another, Thekkek complained that if Paksn’s employees did not pay medical directors promptly every month, “[t]hese doctors will not give us patients.” On a third occasion, a Paksn employee told Thekkek that because “lately there are no real referrals” from one of the medical directors, “i am planning to say goodbye to him.”

            “The payment of kickbacks to physicians for referrals turns patients into commodities that can be traded,” said Acting United States Attorney Tracy L. Wilkison. “Profits should not dictate medical decisions, which is why it is illegal to pay for referrals that can cloud physicians’ medical judgment.”

            “Illegal financial arrangements with physicians can improperly influence the type and amount of health care that is provided to patients,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “The department is committed to redressing the corrupting influence of kickbacks on the medical decision making of providers participating in federal health care programs.”

            This case was initially filed in December 2015 by Trilochan Singh, who was previously employed as Paksn’s vice president of operations and chief operating officer, under the whistleblower provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States for false claims and share in any recovery. The Act permits the United States to intervene and take over the lawsuit, as it has done here in part. Those who violate the Act are subject to treble damages and applicable penalties.

            The case is captioned United States of America ex rel. Trilochan Singh v. Paksn, Inc., et al., CV15-9064.

            The United States’ intervention in this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).

            This matter is being handled by the Civil Division’s Commercial Litigation Branch (Fraud Section) and the United States Attorney’s Office for the Central District of California (Civil Fraud Section), with assistance from the U.S. Department of Health and Human Services’ Office of Inspector General.

            The claims asserted against defendants are allegations only and there has been no determination of liability.

          RIVERSIDE, California – Three Inland Empire women have pleaded guilty to federal criminal charges accusing them of using information belonging to other people – including California state prison inmates – to file for pandemic-related unemployment benefits, with each defendant causing at least $350,000 in losses.

          Paris Denise Thomas, 33, of San Bernardino, pleaded guilty today to a one-count information charging her with wire fraud. United States District Judge Jesus G. Bernal has scheduled a September 13 sentencing hearing.

          On Friday, Sequoia Edwards, 35, of Moreno Valley, and Mireya Ramos, 42, of Colton, each pleaded guilty to one count of wire fraud. United States District Judge John W. Holcomb has scheduled an August 27 sentencing hearing for Ramos. Edwards’ sentencing hearing will be scheduled on a later date set by Judge Holcomb.

          As a result of their guilty pleas, all three women face a statutory maximum sentence of 30 years in federal prison.

          The Coronavirus Aid, Relief, and Economic Security (CARES) Act passed by Congress and signed into law in March 2020 provided additional unemployment insurance (UI) benefits to qualified individuals and helped provide UI benefits during the COVID-19 pandemic to people who did not otherwise qualify, including business owners, self-employed workers, independent contractors, and those with a limited work history.

          According to her plea agreement, from June 2020 to December 2020, Thomas submitted at least 47 fraudulent UI claims to the California Employment Development Department (EDD), which administers the UI program in California.

          Thomas admitted to receiving the names, Social Security numbers, dates of birth and other personally identifiable information of California state prison inmates and others, which she used to submit applications for UI benefits via the internet as if those persons were submitting the claims themselves. Thomas falsely represented to the EDD that the inmates were unemployed because of the COVID-19 pandemic. In exchange for cash payments, Thomas provided third parties with the electronic benefit payment debit cards which were loaded periodically with UI benefits and EDD website login credentials linked to the fraudulent UI claims.

          In total, Thomas caused EDD to disburse approximately $477,000 in fraudulently obtained unemployment benefits.

          Edwards admitted in her plea agreement that, from July 2020 to August 2020, she submitted at least 27 fraudulent UI claims to the EDD using the information of California state prison inmates and other people, and falsely stating they had lost their jobs because of the COVID-19 pandemic. In total, Edwards caused the EDD to disburse approximately $456,218 in UI benefits from July 2020 to March 2021.

          Ramos admitted that, from June 2020 to December 2020, she submitted approximately 37 fraudulent UI claims to the EDD using the personal information of California prison inmates and others, falsely representing to the EDD that the inmates were unemployed because of the COVID-19 pandemic. Ramos entered false occupations for each “applicant” and created various email addresses so she could monitor the status of each application, according to her plea agreement.

          In total, Ramos caused the EDD to fraudulently disburse approximately $353,532 in UI benefits from June 2020 to January 2021.

          The United States Department of Labor – Office of Inspector General, the FBI, and the United States Postal Inspection Service investigated these matters. Investigators with the California Employment Development Department and special agents from the California Department of Corrections and Rehabilitation – Office of Correctional Safety provided substantial assistance.

          Assistant United States Attorney Byron R. Tuyay of the Riverside Branch Office is prosecuting these cases.

          LOS ANGELES – A former executive at a Hollywood-based digital marketing company that represents influencers on Instagram and YouTube was sentenced today to 79 months in federal prison for embezzling more than $22 million from his employer and then using the stolen money for personal expenses and cryptocurrency gambling.

          Dennis Blieden, 31, of Cincinnati, but who formerly lived in Santa Monica, was sentenced by United States District Judge André Birotte Jr., who also ordered him to pay $22,669,979 in restitution.

          Blieden pleaded guilty in November 2019 to one count of wire fraud and one count of aggravated identity theft.

          From October 2015 to March 2019, Blieden was the controller and vice president of accounting and finance for StyleHaul Inc., a digital company once based in Hollywood. As part of his job, Blieden had control over the company’s bank accounts. He abused this authority to wire company money to his personal bank account, then, used the stolen money to pay for personal expenses, gambling debt, and to fund his cryptocurrency accounts.

          To conceal his scheme, Blieden made fraudulent entries in StyleHaul’s accounting records, falsely representing that the illegal wire transfers he made were authorized payments of money due to StyleHaul clients. Blieden also falsely indicated on one of StyleHaul’s bank accounts that wire transfers to Blieden’s personal bank account were “equity” draws that the company owed him. Furthermore, Blieden created fictitious wire transfer letters that purported to be from Western Union and were designed to make it appear that he had caused wire transfers from StyleHaul to pay money it purportedly owed to a client.

          Blieden also disguised his fraud by creating a fictitious lease in May 2018 for the rental of a condominium in Rosarito Beach, Mexico, which bore a forged signature of a StyleHaul executive. He illicitly transferred $230,000 of StyleHaul’s funds by falsely representing that the condominium was being rented for business purposes for StyleHaul’s clients and employees.

          Blieden, who has entered and won professional poker tournaments, also frequently engaged in online gambling with cryptocurrency he purchased with embezzled money.

          “(Blieden)…breached the trust and obligations owed to the young and perhaps unsophisticated YouTube, Instagram, and other social media influencers and creators, who earned money through their work on said platforms, that were needed to support their families,” prosecutors wrote in their sentencing memorandum. “Those clients relied upon defendant to do his job, when instead, he stole millions (of dollars) from them.”

          The FBI investigated this matter.

          Assistant United States Attorney Valerie L. Makarewicz of the Major Frauds Section prosecuted this case.

          RIVERSIDE, California – Law enforcement authorities today arrested 12 defendants charged in a federal grand jury indictment alleging they conspired to traffic large quantities of methamphetamine from their suppliers in Mexico into and throughout the Inland Empire.

          The 19-count indictment charges a total of 19 defendants with one count of conspiracy to distribute and possess with intent to distribute methamphetamine, an offense that carries a mandatory minimum 10-year prison sentence and a statutory maximum penalty of life imprisonment.

          During this morning’s takedown, 12 of the federal defendants were arrested. Three other defendants were already in federal or state custody on unrelated charges, and federal prosecutors will seek to have them brought into federal court. Four defendants are fugitives.

          The defendants arrested today are expected to make their initial appearances this afternoon in the United States District Court in Riverside and downtown Los Angeles.

          According to the indictment returned on May 5 and unsealed today, from April to August 2020, lead defendants Timoteo Gomez, 48, of Riverside, and Javier Rodriguez, a.k.a. “Harvey,” 54, of Riverside, purchased methamphetamine from their suppliers in Mexico as well as Los Angeles and Riverside counties. Other alleged members of the conspiracy would further distribute methamphetamine in the Inland Empire.

          The indictment details the conspirators’ efforts in April 2020 to smuggle 46.6 pounds (21.2 kilograms) of methamphetamine from Mexico across the U.S port of entry at Calexico and into Riverside County. In May 2020, another co-conspirator allegedly attempted to drive a load of 90.4 pounds (41 kilograms) of methamphetamine into the United States from Mexico through the San Ysidro port of entry.

          In total, law enforcement seized more than 150 pounds (68 kilograms) of methamphetamine and $31,035 in cash during this investigation.

          The indictment also charges some of the defendants with conspiracy to import methamphetamine, possession with intent to distribute methamphetamine, possession with intent to distribute fentanyl, being a felon in possession of ammunition, and attempted international money laundering.

          Two additional defendants were charged in separate indictments in March in connection with this case, bringing the number of defendants charged so far to 21. Both were arrested in April on charges of possession with intent to distribute methamphetamine and are currently in federal custody. One has pleaded guilty and the other is awaiting trial.

          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’s Inland Empire Safe Streets Task Force investigated this matter. The Task Force is a joint federal and state gang task force that includes the FBI; the Drug Enforcement Administration; IRS Criminal Investigation; the Riverside County Sheriff’s Department; and the Riverside Police Department. The FBI’s Safe Streets Task Force received assistance during the investigation from the San Bernardino County Sheriff’s Department; U.S. Customs and Border Protection, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the United States Marshals Service.

          The investigation leading to these federal charges focused on the criminal activities of the Riverside-based Casa Blanca Rifa criminal street gang to combat drug trafficking and associated violence in Riverside and the surrounding community.

          Assistant United States Attorney Robert S. Trisotto of the Riverside Branch Office is prosecuting this case.

          LOS ANGELES – Law enforcement officials have arrested three men allegedly involved in a ring that kidnapped at least six people near the U.S.-Mexico border, later demanding ransom for their release, and often refusing to release them after payments were made.

          Edgar Adrian Lemus, 23, of Vernon; Francisco Javier Hernandez Martinez, 20, also of Vernon; and Junior Almendarez Martinez, 23, of Watts, have been charged with one count of money laundering conspiracy. Lemus and Hernandez were arrested Monday evening on a federal criminal complaint. Almendarez was arrested – also on Monday evening – on a separate complaint. The three defendants are expected to make their initial appearances this afternoon in United States District Court in downtown Los Angeles.

          According to affidavits filed with the complaints, each of the kidnapping incidents targeted victims who were waiting or attempting to cross the border from Mexico into the United States. In each incident, the kidnappers offered to assist in smuggling the victims across the border from Mexico, but instead would hold them for ransom. The kidnappers insisted on ransom payments from the victim’s family members to release the victim, the affidavit states.

          The kidnappers allegedly used specific sections at Walmart and other stores in Southern California to meet with the family members to collect the ransom payments. After the payments were made, however, the kidnappers demanded additional money rather than releasing the victim, according to the affidavit.

          Law enforcement has identified Lemus, Hernandez and Almendarez as individuals that either picked up or received ransom payments from the victims’ family members, the affidavit alleges. Specifically, the defendants allegedly match the individuals captured on video surveillance footage during the ransom drops.

          Lemus allegedly picked up a $19,000 ransom payment on April 20 at a Walmart store in South Gate from the husband of a victim in Mexicali who had been promised she would be smuggled into the United States, but who had been kidnapped instead. After delivering the payment, the kidnappers allegedly refused to release the victim and demanded additional payment. After the victim’s husband told the kidnappers that they had made him crash his car and he was in the streets begging for more money, they stopped calling him. The victim was released on April 22.

          Hernandez allegedly picked up a $15,000 ransom payment on May 26 at a Walmart in Paramount from the husband of another kidnapping victim who was being held in Mexicali. After the ransom payment was made, the kidnappers allegedly demanded an additional $16,000 because the victim purportedly broke a package believed to contain narcotics, the affidavit states. All three allegedly were seen together on May 31 at a shopping center in Pico Rivera for another ransom payment pickup.

          Almendarez was observed with Lemus and Hernandez after Lemus picked up a ransom payment at a Target store in South Gate, an affidavit attached to a criminal complaint charging him alleges. From February 9 to June 2, Almendarez allegedly made 10 cash transfers – all but one sent to individuals in Mexico – totaling $14,720 at a MoneyGram store in Lynwood. Several of the transfers were sent to a receiving MoneyGram agent in Mexicali, where the kidnappings occurred, the affidavit alleges.

          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, the defendants would face a statutory maximum sentence of 20 years in federal prison.

          The FBI investigated this matter. The South Gate Police Department and the Santa Barbara County Sheriff’s Office provided substantial assistance.

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

            LOS ANGELES – Federal prosecutors today filed charges against a now-retired nun who was the principal of a Catholic elementary school in Torrance and who has agreed to plead guilty to fraud and money laundering charges for stealing more than $835,000 in school funds to pay for personal expenses, including gambling trips.

            Mary Margaret Kreuper, 79, of Los Angeles, was charged today with one count of wire fraud and one count of money laundering. In conjunction with the criminal information, prosecutors filed a plea agreement in which Kreuper agreed to plead guilty to the two charges that carry a maximum statutory penalty of 40 years in federal prison.

            For a period of 10 years ending in September 2018, Kreuper embezzled money from St. James Catholic School. As principal – a position she held for 28 years – Kreuper was responsible for the money the school received to pay for tuition and fees, as well as for charitable donations. Kreuper controlled accounts at a credit union, including a savings account for the school and one established to pay the living expenses of the nuns employed by the school.

            Kreuper, who as a nun had taken a vow of poverty, diverted school funds into the St. James Convent Account and the St. James Savings Account and then, as she admitted in her plea agreement, used the diverted funds “to pay for expenses that the order would not have approved, much less paid for, including large gambling expenses incurred at casinos and certain credit card charges.”

            Kreuper further admitted in her plea agreement that she falsified monthly and annual reports to the school administration to cover up her fraudulent conduct and “lulled St. James School and the Administration into believing that the school’s finances were being properly accounted for and its financial assets properly safeguarded, which, in turn, allowed defendant Kreuper to maintain her access and control of the school’s finances and accounts and, thus, continue operating the fraudulent scheme.” The criminal information also alleges that Kreuper directed St. James School employees to alter and destroy financial records during a school audit.

            Kreuper admitted that, over the course of the scheme, she caused losses to St. James Catholic School totaling $835,339.

            Kreuper has agreed to appear in United States District Court for an arraignment on July 1.

            The Torrance Police Department, the FBI and IRS Criminal Investigation conducted the investigation in this matter.

            Assistant United States Attorney Poonam G. Kumar of the Major Frauds Section is prosecuting the case.

          SANTA ANA, California – A former Orange County chiropractor was found guilty by a jury today of federal criminal charges accusing her of defrauding health insurers by fraudulently submitting and causing to be billed $2.2 million in billings for chiropractic services never provided, bogus medical diagnoses, office visits that never occurred, and medical devices falsely prescribed.

          Susan H. Poon, 56, of Dana Point, was found guilty of five counts of health care fraud, three counts of making false statements relating to health care matters, and one count of aggravated identity theft in the first criminal jury trial to occur in the Central District of California since March 2020.

          According to the evidence presented at her five-day trial, from January 2015 to April 2018, Poon, whose office was located in Rancho Santa Margarita, schemed to defraud Anthem and Aetna by submitting false reimbursement claims for services that never occurred, false diagnoses and chiropractic services that were never performed.

          Poon also submitted fraudulent prescriptions containing fabricated medical diagnoses of individuals that she had never met, including children, causing a medical device manufacturer to submit false claims for reimbursement to Blue Shield of California.

          The patient-victims that Poon claimed to have met with and treated were dependents – such as the spouses and children – of Costco Wholesale Corp. and United Parcel Service Inc. employees, dependents whose personal identification information Poon unlawfully took and used in her reimbursement requests and prescriptions. Poon obtained the personal information of employee-dependents by attending health fairs at various UPS warehouses and Costco locations, and soliciting such information from employees.

          In total, Poon billed and caused to be billed approximately $2.2 million through her scheme.

          Poon’s chiropractic license was revoked in July 2019, according to the California Department of Consumer Affairs.

          United States District Judge David O. Carter has scheduled an August 30 sentencing hearing, at which time Poon will face a statutory maximum sentence of 67 years in federal prison.

          The following agencies investigated this matter: Amtrak - Office of the Inspector General, California Department of Insurance, U.S. Department of Labor - Employee Benefits Security Administration, U.S. Department of Labor - Office of the Inspector General, the FBI, and Office of Personnel Management - Office of the Inspector General.

          Assistant United States Attorneys Daniel S. Lim and Daniel H. Ahn of the Santa Ana Branch Office are prosecuting this case.

          LOS ANGELES – The CEO of two Hollywood production companies that specialize in reality television programming has agreed to plead guilty to wire fraud for obtaining a $2 million business loan using fabricated documents and by misrepresenting his companies’ financial circumstances.

          Jonathan Lee Smith, 40, of West Hollywood, was charged in an information with wire fraud. In a plea agreement also filed today, Smith agreed to plead guilty to the felony offense, which carries a statutory maximum penalty of 20 years in federal prison.

          According to the plea agreement, Smith managed and owned two production companies, Hoplite Entertainment, Inc. and Hoplite, Inc. To convince a private lender to fund a $2 million loan last year, Smith falsely represented that his two companies had accounts receivable of $3,348,000, and he submitted falsified license agreements and other forgeries to back up the claim.

          To convince the private lender to give him additional time to repay the loan, court documents state, Smith falsely represented that payment was imminent. He also emailed a fake record showing a $100,000 wire payment from Hoplite, Inc. to the lender. In reality, the loan was never repaid, and Smith has agreed to pay $2 million in restitution.

          Smith is expected to make his initial appearance in this case in United States District Court on July 6.

          The FBI investigated this matter.

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

          LOS ANGELES – A Riverside County man pleaded guilty today to a federal criminal charge for inflicting severe injuries on a puppy – including slitting its throat – then posting videos of the suffering animal on his social media accounts.

          Angel Ramos-Corrales, 19, of Riverside, pleaded guilty to one felony count of animal crushing.

          According to his plea agreement, on February 13, Ramos-Corrales assaulted his pet dog, whom he named “Canelo,” inflicting severe injuries to the puppy’s head and torso, causing skull and rib fractures. The dog’s injuries caused it to continuously fall headfirst, and Ramos-Corrales recorded a video of the injured puppy and posted it on his Instagram account.

          On the same day, Ramos-Corrales slit Canelo’s throat by approximately 4.4 centimeters (1.7 inches), causing the dog to bleed significantly and lapse into unconsciousness. While Canelo was lying on a bathroom floor, Ramos-Corrales recorded a video of the puppy and posted it on his Snapchat account, according to the plea agreement. On the video, Ramos-Corrales makes a series of statements, including “I’m cold-hearted,” and then callously kicks the still-alive Canelo.

          After law enforcement arrived at Ramos-Corrales’ residence, Riverside County Department of Animal Services took custody of Canelo and a veterinarian determined that the dog was still alive, but later euthanized Canelo because of the severity of the dog’s injuries.

          United States District Judge John F. Walter has scheduled an August 16 sentencing hearing, at which time Ramos-Corrales will face a statutory maximum sentence of seven years in federal prison.

          The FBI investigated this matter and received substantial assistance from the Riverside Police Department. The Riverside County District Attorney’s Office received the initial referral from the Riverside Police Department, and, after reviewing the matter and conferring with the United States Attorney’s Office, a decision was made that federal prosecutors would file the case.

          Assistant United States Attorney Julius J. Nam of the Riverside Branch Office is prosecuting this case.

A California man pleaded guilty today to conspiracy to commit health care fraud.

According to court documents, Keyvan Amirikhorheh, M.D, 61, of Seal Beach, worked as a physician at Los Angeles Community Clinic. Together with his co-defendants, Amirikhorheh defrauded the Family Planning, Access, Care and Treatment (Family PACT) program administered by Medi-Cal, the California Medicaid program, by submitting and causing the submission of fraudulent claims for family planning services, diagnostic testing, and prescriptions for non-existent patients.

Amirikhorheh is the final defendant to plead guilty. Hilda Haroutunian, 61, of Sun Valley, California pleaded guilty on Sept. 25, 2020, and is scheduled to be sentenced on Dec. 17; Lorraine Watson, 57, a physician’s assistant, of Valley Village, California, pleaded guilty on Oct. 9, 2020, and is scheduled to be sentenced on Sept. 10; Edmond Sarkisyan, 41, of North Hollywood, California, pleaded guilty on Jan. 29, and is scheduled to be sentenced on July 16; and Noem Sarkisyan, 65, of North Hollywood, California, pleaded guilty on March 5, 2020, and is scheduled to be sentenced on Sept. 3.

As alleged in court documents, between approximately March 2016 and April 2019, Los Angeles Community Clinic and associated laboratories and pharmacies submitted approximately $8,406,204 in claims to Medi-Cal and were paid approximately $6,660,028 as the result of this fraudulent scheme.

Amirikhorheh pleaded guilty to conspiracy to commit health care fraud. He is scheduled to be sentenced on Oct. 1, and faces a maximum penalty of 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division; Acting U.S. Attorney Tracy L. Wilkison of the Central District of California; Assistant Director in Charge Kristi Koons Johnson of the FBI’s Los Angeles Field Office; Special Agent in Charge Timothy DeFrancesca of the U.S. Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Los Angeles Regional Office; and Special Agent in Charge Kris Lyle of the California Department of Justice made the announcement.

The FBI, Department of Health and Human Services-Office of Inspector General, and California Department of Justice are investigating the case, which was charged as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.

Trial Attorneys Alexis Gregorian and Claire Yan of the Criminal Division’s Fraud Section are prosecuting the case.

The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program nearly $19 billion.

          SANTA ANA, California – An Orange County man was sentenced today to 24 months in federal prison for operating an illegal virtual-currency money services business that exchanged up to $25 million – some of it on behalf of criminals – through in-person transactions and a network of Bitcoin ATM-type kiosks.

          Kais Mohammad, a.k.a. “Superman29,” 37, of Yorba Linda, was sentenced by United States District Judge Josephine L. Staton.

          Mohammad pleaded guilty in September 2020 to a three-count criminal information charging him with operating an unlicensed money transmitting business, money laundering, and failing to maintain an effective anti-money laundering program. Mohammad has agreed to forfeit to the government 17 Bitcoin ATMs, $22,820 in cash, 18.4 Bitcoin and 222.5 Ethereum cryptocurrency.

          From December 2014 to November 2019, Mohammad owned and operated Herocoin, an illegal virtual-currency money services business. As part of his business, Mohammad offered Bitcoin-cash exchange services, charging commissions of up to 25 percent – significantly above the prevailing market rate.

          Using the moniker “Superman29,” Mohammad advertised his business online to buy and sell Bitcoin in transactions up to $25,000. In a typical transaction, he met clients at a public location in Southern California and exchanged currency for them. Mohammad generally did not inquire as to the source of the clients’ funds and, on certain occasions, he knew the funds were the proceeds of criminal activity. Mohammad knew at least one Herocoin client was engaged in illegal activity on the dark web.

          Mohammad processed cryptocurrency deposited into the machines, supplied the machines with cash that customers would withdraw, and maintained the server software that operated the machines. Mohammad was able to monitor transactions on the machines and identify each transaction that occurred on them.

          During the time of Herocoin’s operation, Mohammad, a former bank employee who trained others on compliance matters, intentionally failed to register his company with the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN). Mohammad was aware that he was required to – but chose not to – develop and maintain an effective anti-money laundering program, file currency transaction reports for exchanges of currency in excess of $10,000, conduct due diligence on customers, and file suspicious activity reports for transactions over $2,000 involving customers he knew, or had reason to suspect, were involved in criminal activity.

          With respect to his Bitcoin ATM network, Mohammad’s machines allowed customers to conduct financial transactions without requiring any identification and permitted customers to conduct multiple, consecutive transactions of up to $3,000 each without ever reporting suspicious activity to regulators or law enforcement.

          After FinCEN contacted Mohammad in July 2018 about his need to register his company, Mohammad did so, but he continued to fail to comply fully with federal law concerning money laundering, conducting due diligence and reporting suspicious customers.

          “Rather than use his knowledge to create a robust compliance program, (Mohammad) avoided one altogether and profited by making his business an efficient, unchecked, and nearly anonymous conduit for money laundering and other crimes,” prosecutors wrote in their sentencing memorandum.

          From February 2019 to August 2019, Mohammad also conducted multiple in-person transactions with undercover agents who represented they worked at a “karaoke bar” that employed women from Korea who entertained men in various ways, including engaging in sexual activity. On August 28, 2019, Mohammad met with an undercover law enforcement agent and exchanged $16,000 in cash, which the agent represented were the proceeds from illegal activity, for 1.58592 Bitcoin. Mohammad never filed a currency transaction report or suspicious activity report for these transactions.

          In total, Mohammad exchanged between $15 million and $25 million from in-person exchanges and transactions occurring at his Bitcoin kiosks.

          IRS Criminal Investigation, Homeland Security Investigations, and the Los Angeles County Sheriff’s Department investigated this matter. This investigation was conducted with the support of the Organized Crime Drug Enforcement Task Force (OCDETF).

          Assistant United States Attorney Ian V. Yanniello of the International Narcotics, Money Laundering, and Racketeering Section prosecuted this case.

          LOS ANGELES – Two employees of a cargo handling company who worked at Los Angeles International Airport were arrested this morning pursuant to a federal grand jury indictment that charges them will stealing four gold bars that were part of a larger shipment going from Australia to New York.

          Marlon Moody, 38, and Brian Benson, 35, both of South Los Angeles, were arrested without incident by special agents with the FBI. The two defendants are expected to make their initial appearances this afternoon in United States District Court in downtown Los Angeles.

          A two-count indictment filed Tuesday charges Moody and Benson with conspiracy and theft of interstate and foreign shipment.

          The indictment alleges that both men worked for Alliance Ground International, a company that provided ground handling services at LAX. On the evening of April 22, 2020, a shipment of gold bars arrived at LAX on Singapore Airlines. A total of 2,000 gold bars, each weighing one kilogram and valued at approximately $56,000, were being shipped at the direction of a Canadian bank. During a stopover at LAX, the gold was offloaded and secured, but an inventory that evening showed one box containing 25 gold bars was missing.

          Moody allegedly found the missing box of gold bars near the Singapore Airlines cargo warehouse on the morning of April 23, placed the box on a belt loader and drove that vehicle to a nearby location, where he removed four of the bars. Soon after, Benson arrived to pick up Moody in a company van, where they exchanged text messages about the gold bars because other employees were in the van. The two defendants later left the airport and went to a nearby parking lot, where Moody gave Benson one of the four gold bars, the indictment states.

          The lost box with the 21 remaining gold bars was discovered by other cargo handlers later on April 23, and authorities began an investigation that ultimately led to Moody and Benson.

          Moody gave one gold bar to a relative on May 4 “and directed the family member to exchange the gold bar for a vehicle and/or money,” according to the indictment. Around this time, Moody buried the remaining two gold bars in the backyard of his residence.

          The FBI recovered all four gold bars about two weeks after they went missing from LAX.

          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 they were to be convicted of the two charges, Moody and Benson each would face a statutory maximum sentence of 15 years in federal prison.

          The FBI, the Federal Air Marshal Service, the Los Angeles Police Department, and the Los Angeles Airport Police investigated this matter.

          Assistant United States Attorneys J. Jamari Buxton of the Public Corruption and Civil Rights Section and Lyndsi C. Allsop of the General Crimes Section are prosecuting the case.

          LOS ANGELES – Two United States Postal Service (USPS) employees pleaded guilty today to federal criminal charges accusing them of unlawfully buying and cashing tens of thousands of dollars’ worth of Postal money orders with unemployment benefits fraudulently obtained with false claims of COVID-related job losses.

          Christian Jeremyah James, 31, of South Los Angeles, who worked in the Culver City Main Post Office, and Armand Caleb Legardy, 32, of Inglewood, who worked in the La Tijera Post Office on Crenshaw Boulevard in South Los Angeles, each pleaded guilty in separate hearings to one count of use of unauthorized access devices.

          According to their plea agreements, from August 2020 to February 2021, James and Legardy used debit cards that the California Employment Development Department (EDD) had issued to other people for unemployment insurance benefits – cards that were obtained by other unidentified individuals using stolen identities and false information.

          James and Legardy admitted they used the EDD-issued debit cards in other people’s names to purchase or cash money orders from the USPS and to withdraw thousands of dollars in cash from bank ATMs. The defendants also admitted that they deposited multiple fraudulently purchased Postal money orders directly into their own bank accounts.

          Between September 3 and September 19, 2020, James deposited more than $27,000 worth of USPS money orders into his bank account, according to his plea agreement. Legardy deposited more than $10,000 in USPS money orders that had been illegally purchased with California EDD cards in other people’s names, his plea agreement states.

          James admitted to knowingly using at least eight EDD debit cards in other people’s names and causing a loss of approximately $142,652. Legardy admitted to illegally using nine EDD cards and causing a loss of approximately $160,879.

          United States District Judge George H. Wu has scheduled sentencing hearings of October 7 for James and September 30 for Legardy, at which time each defendant will face a statutory maximum sentence of 10 years in federal prison.

          The United States Postal Service Office of Inspector General, the United States Department of Labor Office of Inspector General, IRS Criminal Investigation, and the California Employment Development Department investigated this matter.

          Assistant United States Attorney Charles E. Pell of the Santa Ana Branch Office is prosecuting these cases.

          LOS ANGELES – A Gardena man was sentenced today to 162 months in federal prison for running a multi-year scam in which he fraudulently obtained nearly $1 million in business loans by setting up shell corporations – complete with people paid to pose as fake corporate “officers” – that deceived small business lenders into believing they were legitimate companies.

          Troy Rustill Stroud, 54, of Gardena, was sentenced by United States District Judge Stephen V. Wilson, who also ordered him to pay $968,169 in restitution.

          Stroud pleaded guilty in August 2020 to one count of conspiracy to commit wire fraud. He has been in federal custody since his arrest in this matter in May 2020.

          Stroud created several corporations that purported to be in business, but in fact did none. The sham businesses included kitchen remodeling companies Glorious Oak Company and Glossy Grape Investments Inc., and Polished Pine Group, an audio-visual company, according to court documents. Stroud applied for business loans from at least 22 financial institutions and used the names of 14 companies in doing so, court documents state.

          Stroud conducted a series of transfers from bank accounts in some of his corporations’ names to those held in other names to make it appear that the sham corporations were engaging in business.

          Stroud paid other people to pretend to be officers of his corporations, and then he used the names of those “officers” to apply online for business loans for his sham companies. Stroud falsely reported that the shell companies had substantial revenues when in fact they had none.

          When Stroud received the loan proceeds, he used them to pay for his personal expenses, and defaulted on the loans immediately or after a payment or two. Stroud admitted that his scheme to defraud lenders caused $968,169 in actual losses.

          The FBI investigated this matter.

          Assistant United States Attorney Andrew Brown of the Major Frauds Section prosecuted this case.

          LOS ANGELES – A Riverside County man who used a Molotov cocktail in an attempt to destroy the East Valley Republican Women Federated (EVRWF) office in La Quinta was sentenced today to 60 months in federal prison.

          Carlos Espriu, 24, of Palm Desert, who has been in federal custody since his arrest in September 2020, was sentenced by United States District Judge Percy Anderson. Judge Anderson also ordered Espriu to pay $5,426 in restitution to the victim for the damage caused by the firebombing.

          Espriu pleaded guilty on March 15 to one count of attempted arson of a building.

          During the early morning hours of May 31, 2020, Espriu broke the front windows of the EVRWF headquarters and repeatedly tossed through the windows a lighted Molotov cocktail made of three bottles he had taped together.

          Several minutes later, surveillance video shows Espriu returning to the EVRWF office, smashing more windows with the bat and reaching into building to retrieve the Molotov cocktails before walking away with the device. Espriu returned to the EVRWF office about 30 seconds later, this time without a mask, and threw the set of bottles into the facility, which immediately caused a fire to start.

          Law enforcement executed search warrants on Espriu’s residence and car, and recovered a dash camera, among other items. Stored on the dash camera was a recording from June 28, 2020 in which Espriu spoke to a woman in detail about lighting the fire at the EVRWF. He described his planning, his attempts to recruit others to help him, and the steps he took to start the fire.

          The FBI’s Inland Empire Joint Terrorism Task Force investigated this matter.

          Assistant United States Attorney Sara B. Milstein of the Violent and Organized Crime Section prosecuted this case.

          SANTA ANA, California – An orthopedic surgeon was sentenced today to 15 months in federal prison for accepting nearly $623,000 in bribes and kickbacks in exchange for referring his patients to receive spinal surgeries at a corrupt Long Beach hospital.

          Dr. Jeffrey David Gross, 55, who resides in Dana Point and Las Vegas, was sentenced by United States District Judge Josephine L. Staton, who also ordered him to forfeit $622,936. Gross pleaded guilty in August 2020 to one felony count of conspiracy to commit honest services mail and wire fraud.

          The kickback scheme centered on Pacific Hospital in Long Beach, which specialized in surgeries, especially spinal and orthopedic procedures. The owner of Pacific Hospital, Michael D. Drobot, conspired with doctors, chiropractors and marketers to pay kickbacks in return for the referral of thousands of patients to Pacific Hospital for spinal surgeries and other medical services paid for primarily through the California workers’ compensation system.

          During its final five years, the scheme resulted in the submission of more than $500 million in fraudulent medical bills. To date, 15 defendants have been convicted for participating in the kickback scheme.

          From 2008 to 2013, Gross, a licensed neurosurgeon who operated Oasis Medical Providers Inc. in Laguna Niguel, agreed with Drobot to participate in a scheme to defraud patients of their right to honest services by accepting bribes and kickbacks that were paid to induce Gross to refer patients to Pacific Hospital for spinal surgeries and other medical services.

          In February 2008, Gross agreed with Drobot to sublease Oasis’s medical office space to a Pacific Hospital-affiliated company, Pacific Specialty Physician Management Inc. (PSPM), in return for monthly payments of $15,000. In November 2008, Gross entered into an option contract with PSPM in which Oasis was paid $15,000 per month to purchase the accounts receivable and all other tangible assets of Oasis.

          For both the sublease and option agreements, Gross knew and understood that one purpose of the agreements was to induce him to bring certain spinal surgery patients to Pacific Hospital, though that information wasn’t specified on the lease agreement, nor did Gross disclose that information to his patients.

          PSPM paid Oasis $145,000 under the sublease agreement and $105,000 under the option agreement.

          In April 2009, Gross entered into an outsourced collections agreement with Pacific Hospital that called for him to assist with collections on some of the spinal surgery cases that he performed at that hospital in exchange for 15 percent of any amounts the hospital collected in relation to those surgeries. This agreement, later amended, called for Gross to be paid 10 percent of the collected amount on other outpatient surgeries. During surgeries, if Gross used hardware from International Implants (I2), a Drobot-formed hardware distribution company, he was advanced $5,000 regardless of subsequent collections. Once again, Gross did not disclose this information to his patients. Pacific Hospital paid Oasis $372,936 under this agreement.

          In total, between April 2008 and May 2013, Drobot paid Gross $622,936 pursuant to these agreements. During the same period, Gross referred dozens of patients to Pacific Hospital for spinal surgeries based in part on payments made to him under those agreements.

          The FBI, IRS Criminal Investigation, California Department of Insurance, and the United States Postal Service Office of Inspector General investigated this matter.

          Assistant United States Attorneys Joseph T. McNally of the Violent and Organized Crime Section and Scott D. Tenley of the Santa Ana Branch Office prosecuted this case.

          LOS ANGELES – A Beverly Hills man was arrested today on a murder-for-hire charge that alleges he tried to hire a hitman to kill a woman he briefly dated and who had repeated tried to break off the relationship.

          Scott Quinn Berkett, 24, was arrested this afternoon without incident after being charged in a federal criminal complaint that alleges he sent thousands of dollars in bitcoin to arrange the murder and then wired another $1,000 to the “hitman,” who was actually an undercover FBI agent.

          According to the affidavit in support of the complaint, Berkett met “Victim 1” online last year, and the woman flew to Los Angeles to meet Berkett in late October. Victim 1, who described Berkett’s behavior as “sexually aggressive,” tried on several occasions to break off the relationship following the October trip, the affidavit states.

          In April, a family member who had learned that Berkett continued to contact Victim 1 called and sent text messages to Berkett’s father’s phone, and, on April 20, Berkett appears to have responded saying “consider this matter closed.”

          But, Berkett allegedly contacted a group on the dark web that advertised murder-for-hire services. While law enforcement believes that this dark web group was a scam, the group contacted a media outlet, which provided information to the FBI, including messages from Berkett, who was using a screenname of “Ula77,” and documentation of payments by Berkett, according to the affidavit.

          The media outlet provided “transaction information from an unnamed source on the Dark Web that showed that Bitcoin payments were made with an understanding that an unknown individual would murder Victim 1,” the affidavit states. “The information provided was specific about the identity and location of Victim 1, as well as social media accounts, nicknames, email, and a distinctive tattoo of Victim 1.”

          Berkett allegedly submitted his order for the hit on April 28, writing to the dark web group: “I’d like it to look like an accident, but robbery gone wrong may work better. So long as she is dead. I’d also like for her phone to be retrieved and destroyed irreparably in the process.” The information provided to the FBI indicated that Berkett made Bitcoin payments totally $13,000 between April 5 and May 5.

          An undercover FBI agent, posing as a hitman, made contact with Berkett on Wednesday and eventually sent a photo of Victim 1, which Berkett confirmed was the victim, according to the affidavit. During the discussions with the purported hitman, Berkett demanded a proof-of-death photo that would show the corpse and Victim 1’s distinctive tattoo.

          Berkett made the final $1,000 payment via Western Union late Thursday afternoon, the affidavit states.

          Berkett is expected to make his initial appearance in United States District Court on May 25.

          A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty in court.

          If convicted of the murder-for-hire count, Berkett would face a statutory maximum sentence of 10 years in federal prison.

          The FBI is investigating this matter.

          Assistant United States Attorney Joseph D. Axelrad of the Violent and Organized Crime Section is prosecuting the case.

          LOS ANGELES – The lead defendant in an indictment alleging that a drug trafficking organization shipped thousands of pounds of methamphetamine all over the world – sometimes hidden inside consumer and industrial products – arrived in the United States today after being extradited from France.

          Jose Guillermo Grosso Gamez, 41, of Sinaloa, Mexico, arrived at Los Angeles International Airport early this afternoon. Grosso is expected to be arraigned Monday afternoon in United States District Court in downtown Los Angeles.

          Grosso – who used various aliases, including “Greenhills” and “Martinez Asociados” – is charged with brokering and organizing methamphetamine shipments to destinations around the world. To evade law enforcement, Grosso allegedly concealed drug shipments in industrial machinery and bribed government officials in Mexico.

          According to an eight-count indictment returned by a federal grand jury in 2018, Grosso attempted to ship approximately 265 pounds of methamphetamine from Mexico to Australia concealed in computer equipment. The shipment was intercepted by U.S. law enforcement in Memphis, Tennessee.

          During the investigation, law enforcement in other countries also seized methamphetamine allegedly shipped by Grosso. Those seizures included approximately 725 pounds of methamphetamine hidden inside an industrial ore crusher and an asphalt roller in Manzanillo, Mexico, and approximately 185 pounds of methamphetamine found on a rooster ranch in the Philippines.

          The investigation also led to the discovery of a laboratory in Pomona that converted methamphetamine into crystal form and the seizure of over 12 metric tons of amphetamine powder in Guatemala.

          Grosso is the third defendant to be taken into custody pursuant to the indictment that charges 17 defendants, most of whom are believed to be in Mexico. An Inland Empire man who was previously arrested died in December. The other defendant -- Milton Eduardo Aquino Castaneda, 51, of the Harbor City neighborhood in Los Angeles – was arrested in November after he entered the United States from Mexico.

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

          If convicted of all charges, Grosso would face a potential sentence of decades in federal prison.

          This matter is being investigated by special agents with the Drug Enforcement Administration. The Organized Crime Drug Enforcement Task Force is providing support. Substantial assistance was provided by the Office of International Affairs, the Australian Federal Police, the Australian Criminal Intelligence Commission, and the governments of France and Australia.

          This case is being prosecuted by Assistant United States Attorneys Alexander B. Schwab of the Major Frauds Section and Benedetto L. Balding of the International Narcotics, Money Laundering, and Racketeering Section.

          LOS ANGELES – A federal grand jury today indicted alleged “brokers” accused of scheming to illegally obtain driver’s licenses for ineligible applicants by paying bribes to corrupt employees of the California Department of Motor Vehicles (DMV).

          Carlos Alberto Zea Londono, 58, of Granada Hills, and Eudelia Lopez Martinez, 50, of South Los Angeles, were charged in a superseding indictment with one count of conspiracy to commit honest services mail fraud, a felony offense that carries a statutory maximum penalty of 20 years in federal prison.

          Also charged in today’s indictment are Rogelio Zazueta, 52, of Huntington Park, and Arestakes Khachikyan, a.k.a. “Aries,” 54, of Granada Hills, who each face one count of aiding and abetting the illegal production of identification documents, which carries a 15-year statutory maximum prison sentence. The superseding indictment adds two new charges and three additional defendants to a June 2020 indictment that charged only Zazueta with the aiding and abetting count.

          Today’s indictment alleges that, from April to October 2016, Londono and Lopez negotiated the price that ineligible driver’s license applicants would pay in cash to fraudulently receive passing scores on the written test and/or driving test needed to obtain a California driver’s license. The cash payments ranged from $400 to $1,400, according to the indictment.

          The brokers then contacted the scheme’s ringleader – Antanacio Villegas, a.k.a. “A.T.,” 46, of Portales, New Mexico, but who previously lived in Long Beach and who worked as a license registration examiner at the DMV office in Torrance. Londono and Lopez allegedly paid Villegas cash bribes for the issuance of a validly issued California driver’s licenses without applicants taking the necessary tests to legitimately obtain it. The brokers allegedly also provided Villegas the personal identifying information for the driver’s license applicants.

          Villegas then solicited the services of different California DMV employees who also took cash bribes to make fraudulent entries in the DMV’s computer database to indicate that an applicant had passed the necessary written or driving tests – even though the applicant never actually took or passed the required tests to obtain a California driver’s license. Based on the fraudulent entries, the corrupt DMV employees then unlawfully issued instructional permits or driver’s licenses to the applicants, the indictment alleges.

          As a result, the California DMV prepared and mailed a California driver’s license to applicants that they were not lawfully entitled to receive. Law enforcement believes that more than 100 driver’s licenses were illegally issued because of the scheme.

          Zazueta allegedly aided and abetted the unlawful production of a California identification document in July 2016 on behalf of an individual. According to an affidavit filed with a criminal complaint in this case, Zazueta told the individual that he had connections at the Torrance DMV and could get a license for the individual for $1,200. The individual was issued a driver’s permit even though the individual had not taken a written test, the affidavit states.

          The indictment further alleges that Khachikyan aided and abetted the unlawful production of California identification document in July 2016 on behalf of an individual for whom a corrupt DMV employee entered passing scores on a test required for an instructional permit, then issued the permit without the individual taking or passing the required tests.

          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.

          Villegas is scheduled to plead guilty on June 21 to a seven-count information charging him with honest services mail fraud. In his plea agreement, Villegas admitted that he and other DMV employees accepted cash bribes at least several times per week, and otherwise ineligible drivers would be directed to the window of a corrupt DMV employee with an “identifier” such as a red hat, in order to fraudulently obtain their licenses.

          In a related case, Jovana Tameka Nettles, 44, of Norwalk, pleaded guilty on May 17 to three counts of honest services wire fraud. Nettles, a former manager at the DMV office in the Lincoln Park area of Los Angeles, admitted to fraudulently entering passing scores for applicants and issuing instructional permits for applicants who had not taken or passed the required tests in exchange for bribes. Nettles’ sentencing hearing is scheduled for August 23.

          In another related matter, Taliesha Shunte Ratliff, 37, of Gardena, a former DMV employee in Torrance, pleaded guilty in August 2020 to a single-count information charging her with soliciting and accepting bribes. She is expected to be sentenced in the coming months.

          Also, Otto Escobar, Sr., 63, of Granada Hills, pleaded guilty in November 2020 to one count of aiding and abetting concerning programs receiving federal funds. Escobar, who formerly operated the Van Nuys-based OK Driving School, admitted in his plea agreement that, from 2015 to 2017, he charged his customers a fee for obtaining a fraudulent passing DMV score, and to facilitate the fraud, and he collected money used to bribe DMV employees to commit the fraud. Escobar’s sentencing hearing is scheduled for June 7, at which time he will face 10 years in federal prison.

          The United States Coast Guard Investigative Service and the California Department of Motor Vehicles Office of Internal Affairs is investigating this matter. This matter is a spin-off investigation of CGIS Operation Buzzkill, an investigation to protect maritime safety and security involving the use of fraudulent identification documents by truckers to gain access to secured and restricted areas of the ports of Los Angeles and Long Beach. That investigation resulted in 16 convictions and also resulted in the identification of several corrupt DMV employees who were fraudulently issuing California driver’s licenses.

          Assistant United States Attorneys Amanda M. Bettinelli and Erik M. Silber of the Environmental and Community Safety Crimes Section are prosecuting these cases.

          LOS ANGELES – An Orange County man who led police on a high-speed car chase with more than 75 pounds of cocaine stashed in his vehicle was sentenced today to 186 months in federal prison.

          Anthony Martinez, 40, of La Habra, was sentenced by United States District Judge Michael W. Fitzgerald. Martinez pleaded guilty on January 15 to one count of possession with intent to distribute cocaine. Martinez is one of eight defendants charged in an indictment alleging a conspiracy to traffic cocaine throughout Southern California.

          On July 25, 2019 in Whittier, Martinez received two boxes from a co-defendant that contained 75.2 pounds (34.1 kilograms) of cocaine, placed the boxes in his car and drove off. When Whittier Police officers attempted to pull Martinez over, he initially pulled over, then sped away, refusing to stop, and led police on a car chase in which Martinez veered into oncoming traffic and drove on the wrong side of the road, the plea agreement states.

          “In so doing, [Martinez] recklessly created a substantial risk of death or serious bodily injury to individuals in the community and law enforcement by fleeing from officers,” prosecutors wrote in their sentencing memorandum.

          When police finally pulled Martinez over for good in Fullerton, they discovered the box of cocaine.

          Martinez also possessed 132.6 pounds (60.2 kilograms) of cocaine, separately wrapped in one kilogram “bricks” located in a storage locker, and 52.9 pounds (23.98 kilograms) of cocaine located inside a duffel bag.

          In total, Martinez admitted to possessing 260.6 pounds (118.2 kilograms) of cocaine.

          This case’s lead defendant, Jesus Manuel Landeros-Cisneros, 51, of Covina, pleaded guilty in August 2020 to one count of conspiracy to distribute cocaine. He is serving a 174-month federal prison sentence for that offense.

          Three other defendants in the case – Ryan Alexander Fischer, 23, a.k.a. “Flaco,” of Covina; Manuel Angel Landeros-Lopez, 43, of Covina; David Elgrably, 51, of Suisun City, California – are scheduled to go on trial on July 27. Three defendants – Harnidhan Bhangu, 30; Harmanjot Singh, 29; and Gurpreet Chahal, 41; all Canadian nationals – are fugitives.

          The Drug Enforcement Administration and Homeland Security Investigations investigated this matter. The investigation was conducted with the support of the Organized Crime Drug Enforcement Task Force (OCDETF). As to these seizures, substantial assistance was provided by the South Gate Police Department, the Brea Police Department, and the West Covina Police Department.

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

          LOS ANGELES – Federal authorities today announced 11 criminal cases against alleged drug dealers who sold or provided narcotics to users who suffered fatal overdoses from opioids such as fentanyl or fentanyl analogues.

          As a result of the operation led by the Drug Enforcement Administration, each of the 12 defendants named in the 11 cases is charged with distribution of narcotics resulting in death. If convicted, each defendant would face at least a 20-year mandatory minimum prison sentence and a potential maximum sentence of life without parole in federal prison.

          “These charges are the first steps in bringing justice to the families of victims who often died without knowing they were ingesting some of the world’s most powerful opioids,” said Acting United States Attorney Tracy L. Wilkison. “The conduct alleged in these cases demonstrates the grave threat people face now that fentanyl is widespread and is commonly hidden in a variety of illicit narcotics. The danger posed by opioids is real – both for unwitting users who risk death and for the dealers who face decades in prison for spreading deadly poison in our communities.”

          “The collaborative work to build these cases demonstrates our shared commitment to go after individuals who push fentanyl within our communities and further the opioid crisis, devastating families across the nation,” said DEA Special Agent in Charge Bill Bodner. “Drug dealers who market and sell counterfeit pills via online marketplace and social media platforms may think they can hide behind technology and are absolved from responsibility, but they are not. While our actions can’t bring back a loved one, we hope that we can save other lives by putting these individuals behind bars so they can’t continue to distribute dangerous opioids in the community.”

          The cases are the result of investigations by the DEA’s Overdose Justice Task Force, which was created to address opioid-related deaths in the greater Los Angeles area, most of which are caused the synthetic opioid fentanyl. Under the Overdose Justice program for the DEA’s Los Angeles Field Division, DEA agents collaborate with local law enforcement to analyze evidence to determine if there are circumstances that might lead to a federal criminal prosecution, and, if so, proactively target the drug trafficker. Since the start of the Overdose Justice program in 2018, the DEA has worked with an ever-expanding list of local police agencies to obtain approximately one dozen federal indictments that specifically charge death resulting from narcotics trafficking. The 11 cases announced today add to that list of prosecutions. The Task Force is currently investigating other incidents and expects to file additional criminal cases in federal court.

          The 11 cases announced today include seven new cases that were filed this week and one case in which prosecutors this week filed special allegations that would lead to a mandatory sentence of life without parole in federal prison if the defendant is convicted. The cases are summarized below.

          U.S. v. Fulton

          William Vaughn Fulton, 39, of Torrance, was named in a five-count indictment filed Tuesday that accuses him of distributing fentanyl that caused two deaths on consecutive days in Redondo Beach hotel rooms. In addition to the two charges of distributing fentanyl resulting in death, Fulton is charged with possession with intent to distribute methamphetamine, possession with intent to distribute fentanyl, and being a felon in possession of ammunition.

          The indictment alleges that Fulton distributed fentanyl on October 10, 2020 to a person who died, and the next day he allegedly distributed fentanyl at another hotel where another person died after ingesting the drug. When he was arrested on October 13 by the Redondo Beach Police Department, Fulton allegedly possessed more than two ounces of fentanyl and over 2.5 ounces of methamphetamine. Police also seized two 9mm “ghost guns” and 12 rounds of ammunition Fulton allegedly illegally possessed because, from 2004 through 2017, he previously had been convicted of 24 felony offenses.

          Fulton is currently in state prison after pleading guilty to related charges. The United States is seeking a writ to bring him into federal custody.

          The DEA and the Redondo Beach Police Department are investigating this matter. Assistant United States Attorney Jenna Williams of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting the case.

          U.S. v. Wilson

          Alexander Declan Bell Wilson, 20, of Rolling Hills, was arrested Wednesday after being indicted on Tuesday on one count of distributing pills containing fentanyl that led to the death of a 15-year-old boy on May 15, 2020. Law enforcement reviewed Snapchat conversations between the two that show the victim thought he was buying oxycodone, a commonly used and widely abused semi-synthetic opioid.

          Wilson is scheduled to be arraigned on the indictment this afternoon.

          The DEA and the Los Angeles County Sheriff’s Department are investigating this matter. Assistant United States Attorney Marina A. Torres of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting the case.

          U.S. v. McLaughlin

          Sean Robert McLaughlin, 47, of Aliso Viejo, the former security manager at the American Junkie nightclub in Newport Beach, was arrested this morning pursuant to an eight-count indictment alleging he distributed furanyl fentanyl, an analogue to fentanyl that has a nearly identical chemical makeup. During the early morning hours of November 18, 2016, the indictment alleges, McLaughlin provided a powdered drug to nightclub guests that resulted in three overdoses, one of which was fatal.

          In the indictment filed Wednesday, McLaughlin also is charged with possessing hydrocodone, cocaine, methamphetamine and ecstasy for distribution on the same night as the overdoses. McLaughlin is further charged with distributing cocaine in September 2016.

          McLaughlin was initially charged in December 2017 by Orange County District Attorney’s Office, which has agreed to allow the United States Attorney’s Office to take over the prosecution.

          The DEA and a task force officer from the Seal Beach Police Department are investigating this matter. The Newport Beach Police Department referred the case to federal authorities last year. Assistant United States Attorney Bradley E. Marrett of the Santa Ana Branch Office is prosecuting the case.

          U.S. v. Soheili

          Jason Amin Soheili, 26, of Laguna Hills, was arrested Wednesday pursuant to a criminal complaint filed Tuesday in federal court in Santa Ana. Soheili is charged with mailing fentanyl to a man in Fillmore, Utah, who died after taking the drugs on February 21.

          The affidavit in support of the complaint outlines evidence that Soheili sent a parcel containing fentanyl “blues” to his friend, who moved to Utah from Orange County to participate in a drug rehabilitation program. Law enforcement recovered the actual package with Soheili’s fingerprints at the victim’s residence. A search of Soheili’s home on April 20 resulted in the seizure of items indicating drug trafficking activity, including various narcotics, several of which tested positive for fentanyl, the complaint states.

          At his initial court appearance Wednesday afternoon, Soheili was ordered held without bond, and an arraignment was scheduled for June 1.

          The United States Postal Inspection Service, which worked with the Orange County Sheriff’s Department and the Millard County (Utah) Sheriff’s Office, is investigating this matter. Assistant United States Attorney Vib Mittal of the Santa Ana Branch Office is prosecuting the case.

          U.S. v. Boukhanian

          Michael Boukhanian, 42, of Northridge, was arrested late this morning after a grand jury named him in a one-count indictment filed on Wednesday. Boukhanian allegedly sold counterfeit oxycodone pills containing fentanyl on August 27, 2020 to a Woodland Hills man who died soon after receiving them. Boukhanian is expected to be arraigned Friday afternoon in federal court in Los Angeles.

          The DEA and the Los Angeles Police Department are investigating this matter. Assistant United States Attorney Jehan M. Pernas of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting the case.

          U.S. v. Wood

          Tobin Oliver Wood, 49, of Costa Mesa, was arrested on April 7 pursuant to a grand jury indictment that charges him with distributing fentanyl that caused the overdose death of a 32-year-old San Clemente man, who died on the morning of October 2, 2018. Wood allegedly posted an ad on Craigslist offering “Roxy board short,” which is a street term for oxycodone pills.

          Wood, who has pleaded not guilty and is free on bond, is scheduled to go on trial on March 22, 2022.

          The DEA, the Huntington Beach Police Department and the Costa Mesa Police Department are investigating this matter. Assistant United States Attorney Maxwell K. Coll of the General Crimes Section is prosecuting the case.

          U.S. v. Chi

          Calvin Chi, 28, of Hacienda Heights, has agreed to surrender Friday morning to face charges related to the death of a 29-year-old woman who overdosed on oxymorphone on October 10, 2018. Investigators uncovered text communications between Chi and the victim that allegedly show Chi sold the oxymorphone, along with alprazolam (also known as Xanax), to the victim hours before her death. The victim was found dead, slumped over in the front seat of her car, parked about a half mile from Chi’s San Gabriel Valley residence. Chi was indicted by a federal grand jury on Tuesday.

          In the fall of 2019, Chi was convicted in state court of unrelated drug trafficking charges and sentenced to probation. In July 2020, deputies with the Los Angeles County Sheriff’s Department conducted a probation compliance check of Chi’s residence and found evidence of drug sales, including scales, baggies, a variety of pills, and more than five grams of methamphetamine. In addition to the charge of distribution of narcotics resulting in death, Chi is charged with possession with the intent to distribute methamphetamine.

          The DEA and the Los Angeles County Sheriff’s Department are investigating this matter. Assistant United States Attorney Maria Jhai of the General Crimes Section is prosecuting the case.

          U.S. v. Lopez

          Edwin Lopez, 21, of Riverside, was arrested this morning on a grand jury indictment that charges him with one count related to a May 17, 2020, transaction in which he allegedly sold counterfeit oxycodone pills containing fentanyl to a 20-year-old Fontana man who suffered a fatal overdose two days later. The evidence in the case indicates that Lopez used Snapchat to negotiate the drug deal, and possibly other transactions, with the victim.

          Lopez is scheduled to be arraigned this afternoon in United States District Court in Riverside.

          The DEA and the Fontana Police Department are investigating this matter. The San Bernardino County Sheriff’s Department has provided assistance. The Riverside Branch Office is prosecuting the case.

          U.S. v. Nobar and Ziafathy

          Saied Ziafathy Nobar, 57, of the Rancho Park neighborhood of Los Angeles, and his nephew, Amir Ziafathy, 33, of Granada Hills, face charges of distributing fentanyl that resulted in an overdose death on December 30, 2019. The defendants allegedly sold the victim two counterfeit oxycodone pills that contained fentanyl. Nobar and Ziafathy were arrested in this case on March 16, and they are currently scheduled to go on trial on July 27.

          The FBI, the DEA and the Los Angeles Police Department are investigating this matter. Assistant United States Attorney Ali Moghaddas and Kathrynne Seiden of the General Crimes Section are prosecuting the case.

          U.S. v. Rodriguez

          Marcos Isaac Rodriguez, a.k.a. “Kumar,” 27, who resided in Costa Mesa, but recently relocated to Escondido, was arrested today pursuant to a two-count indictment that alleges distribution of fentanyl resulting in death and distribution of fentanyl. The indictment, which was filed on April 28, charges Rodriguez with distributing fentanyl in two transactions, the second of which resulted in the death of a 33-year-old Costa Mesa man on December 26, 2019. Rodriguez allegedly sold the victim counterfeit oxycodone pills that contained fentanyl.

          Rodriguez is expected to be arraigned this afternoon in United States District Court in Santa Ana.

          The DEA and the Costa Mesa Police Department are investigating this matter. Assistant United States Attorney Jake D. Nare of the Santa Ana Branch Office is prosecuting the case.

          U.S. v. Shepley

            Last year, a Westlake Village man was indicted on federal charges of participating in a conspiracy that allegedly distributed heroin to a Ventura County man who suffered fatal overdose, and this week federal prosecutors filed a new document that would bring a mandatory life sentence if he is convicted.

          Bradford Shepley, 35, is charged with distribution of heroin resulting in death and with participating in a heroin trafficking conspiracy in relation to the overdose of a 26-year-old man who died in his Oak Park residence on November 6, 2017. On Tuesday, prosecutors filed a two-count information alleging that Shepley was convicted in Los Angeles Superior Court in June 2017 of two felony narcotics offenses. If convicted in federal court of the heroin charge, and if prosecutors can prove he was previously convicted of narcotics offenses, Shepley would face a mandatory minimum sentence of life without parole in federal prison.

          Shepley, who is being held in custody without bond, has pleaded not guilty to the offenses alleged in the indictment, and he is currently scheduled to go on trial on November 2.

          The DEA and the Ventura County Sheriff’s Department are investigating this matter. Assistant United States Attorney Keith D. Ellison of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting the case.

          Indictments and criminal complaints contain allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

          LOS ANGELES – A former elementary school teacher who produced pornographic images of his 15-year-old ex-student was sentenced today to 360 months in federal prison.

          Sean David Sigler, 56, of Burbank, was sentenced by United States District Judge John A. Kronstadt, who described Sigler’s conduct as “inexcusable,” and further said, “Ruining the lives of minors is unspeakable.”

          Sigler, who pleaded guilty in September 2019 to two counts of production of child pornography, previously taught fifth-grade students at Bret Harte Elementary School in Burbank and at Gardner Street Elementary School in Hollywood.

          Sigler was the victim’s fifth-grade teacher and kept in contact with her after she left his classroom, using his position as former teacher and mentor to gain the trust of the victim and her parent. Sigler then exploited that trust to gain sexual access to the girl. Over the course of 15 months, Sigler regularly transported the victim to his home, where he gave her alcoholic beverages and pills.

          Sigler began having sex with the minor victim when she was 15 years old, and he created multiple sexually explicit videos of the victim and took sexually explicit photographs of her. The illicit conduct took place between September 2016 and May 2017.

          He also created child pornography by modifying a pornographic image of the minor victim’s body and digitally superimposing the face of a different underage former student, according to a January 2018 law enforcement search of Sigler’s digital devices. The devices contained numerous images and videos of his sexual acts with the victim, as well as more than 5,000 images of child pornography depicting unknown and previously identified pre-pubescent minors.

          Sigler agreed to forfeit $271,506 in cash seized by the government, which constitutes the proceeds from the sale of the home where he produced child pornography.

          Homeland Security Investigations and the Burbank Police Department investigated this matter.

          Assistant United States Attorneys Damaris Diaz of the Violent and Organized Crime Section, Devon Myers of the Cyber and Intellectual Property Crimes Section, and Jonathan S. Galatzan of the Asset Forfeiture Section prosecuted this case.

          LOS ANGELES – Three members of the Rollin’ 30s Crips street gang have been arrested on a federal criminal complaint alleging they committed an armed robbery at a Beverly Hills restaurant’s crowded outdoor dining area on March 4 in which one restaurant patron was held at gunpoint and another was shot and wounded.

          The complaint, which was unsealed on Tuesday, charges the following three men – all South Los Angeles residents and documented members of the Rollin’ 30s Crips – with one count of conspiracy to interfere with commerce by robbery:

• Malik Lamont Powell, 20;
• Khai McGhee, a.k.a. “Cameron Smith,” 18; and
• Marquise Anthony Gardon, 30.

          The defendants were arrested on Tuesday and are expected to make their initial appearances this afternoon in United States District Court in downtown Los Angeles.

          According to an affidavit filed with the complaint, during the afternoon of March 4, an armed robbery occurred at Il Pastaio restaurant in Beverly Hills. During the robbery, a restaurant patron was held at gunpoint while he was robbed by three men for his Richard Mille wristwatch, worth approximately $500,000. A struggle for the gun ensued, during which approximately two rounds were discharged from the firearm, striking another restaurant patron in the leg. Ultimately, the handgun was dropped to the ground during the struggle with the victim. The robbers fled the scene with the victim’s watch.

          Based on a review of video surveillance footage and witness statements, a total of five individuals are believed to be involved in the robbery crew that committed this robbery, the affidavit states. Law enforcement has identified Powell and McGhee as two of the three robbers, and Gardon has been identified as a driver of the robbery crew’s getaway car, according to the affidavit.

          Powell’s car – a black BMW – allegedly was used to transport the robbery crew to and from the robbery, and his cell phone allegedly was present near Il Pastaio at the time of the robbery. Powell’s social media accounts allegedly contained images of various guns and high-value wristwatches.

          McGhee’s DNA was found on the robbery victim’s clothing following the struggle for the gun, the affidavit states. Surveillance camera footage allegedly shows Gardon getting out of the rear passenger seat and into the driver’s seat of the getaway car just before the robbery at Il Pastaio, and his cell phone was present near the restaurant at the time of the robbery.

          Surveillance camera footage allegedly shows the robbers scouting the area prior to the robbery.

          If convicted, the defendants would face a statutory maximum sentence of 20 years in federal prison.

          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 the Beverly Hills Police Department investigated this matter with the Santa Monica Police Department providing assistance.

          Assistant United States Attorneys Joseph D. Axelrad and Jeffrey M. Chemerinsky of the Violent and Organized Crime Section are prosecuting this case.

          SANTA ANA, California – Law enforcement today arrested an employee of a Department of Defense contractor on a criminal complaint alleging he unlawfully sold United States Air Force technical data to an Orange County man who then illegally resold the data to customers.

          Sarfraz Yousuf, 43, of Miramar, Florida, was taken into federal custody this morning. Also arrested today was Marc Chavez, 53, of Trabuco Canyon.

          Yousuf is expected to make his initial appearance in United States District Court in Fort Lauderdale, Florida. Chavez is expected to appear in federal court in Santa Ana. Each man is charged with one count of theft of government property.

          According to an affidavit filed with the complaint, during an investigation into a U.S. Navy employee’s unlawful sale of government-controlled technical drawings to a Newport Beach-based company, Newport Aeronautical Sales Corp. (NASC), law enforcement discovered NASC also illegally obtained U.S. Air Force technical orders from the users of an email account used by Yousuf, an employee of Summit Aerospace Inc., a Miami-based aircraft maintenance company.

          The technical orders at issue in this case are documents that cover installation, operation, maintenance, and handling of Air Force equipment and material, according to the affidavit.

          During the investigation, law enforcement also discovered Chavez illegally acquired Air Force technical orders from Yousuf on behalf of LTC Products, a Trabuco Canyon-based company selling technical aerospace data that Chavez ran out of his home, the affidavit states.

          From January 2015 to July 2020, Chavez allegedly unlawfully acquired at least 1,875 Air Force technical orders from Yousuf in exchange for at least $132,280. Yousuf was not authorized to sell the technical orders and Chavez was not authorized to receive them.

          In June 2020, Yousuf allegedly sold 34 Air Force technical orders to Chavez, including one marked with a distribution statement reserved for “technical data of such military significance that release…may jeopardize an important technological or operational military advantage of the United States” and containing overhaul instructions related to a “Rate Gyro Assembly Flight Control,” for $2,170. Chavez allegedly resold the orders to customers for a profit.

          If convicted, the defendants would face a statutory maximum sentence of 10 years in federal prison.

          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.

          In a related case, Mark Fitting, 54, of Berlin, New Jersey, an engineer employed by the Navy at a facility in Philadelphia, pleaded guilty in December 2020 to one count of conspiracy to steal government property and one count of aiding and abetting the theft of government property. Fitting admitted in his plea agreement that he downloaded technical drawings and manuals related to U.S. military weapons systems and sold the items to NASC, which later resold the documents to domestic and foreign customers. Fitting’s sentencing hearing is scheduled for October 18 in Santa Ana.

          This case is being investigated by the Defense Criminal Investigative Service; the Naval Criminal Investigative Service; Homeland Security Investigations; the Department of Commerce, Bureau of Industry and Security, Office of Export Enforcement; U.S. Air Force Office of Special Investigations; and U.S. Army Criminal Investigation Command.

          Assistant United States Attorney Keith D. Ellison of the International Narcotics, Money Laundering, and Racketeering Section is prosecuting this case.

A California woman was arrested Thursday in Los Angeles on criminal health care fraud charges arising from her false home health certifications and related fraudulent billings to Medicare.

According to court documents, Lilit Gagikovna Baltaian, 58, of Porter Ranch, operated two medical clinics in the Los Angeles area. From approximately January 2012 to July 2018, Baltaian allegedly falsely certified patients to receive home health care from at least four Los Angeles area home health agencies. Baltaian’s false certifications were used by the home health agencies to fraudulently bill Medicare for the unnecessary home health care. Baltaian allegedly received a cash benefit related to these referrals and also submitted claims to Medicare for signing the fraudulent certifications and for patient visits and injections that were not needed and/or provided.

As further alleged in court documents, between January 2012 and July 2018, four home health agencies used Baltaian’s false certifications to submit fraudulent claims to Medicare, resulting in a total of approximately $6,029,674 paid on those claims.

Baltaian is charged with four counts of health care fraud. If convicted, Baltaian faces a maximum penalty of 10 years in prison on each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division; Acting U.S. Attorney Tracy L. Wilkison of the Central District of California; Assistant Director in Charge Kristi Koons Johnson of the FBI’s Los Angeles Field Office; and Special Agent in Charge Timothy DeFrancesca of the U.S. Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Los Angeles Regional Office made the announcement.

The FBI and HHS-OIG are investigating the case, which was charged as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.

The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program nearly $19 billion. 

Trial Attorney Emily Culbertson of the Criminal Division’s Fraud Section is prosecuting the case.

An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

          SANTA ANA, California – An Orange County man was arrested today on federal charges alleging he fraudulently obtained approximately $5 million in Paycheck Protection Program (PPP) loans for his sham businesses, then used the money on himself, including purchasing Ferrari, Bentley and Lamborghini sports cars.

          Mustafa Qadiri, 38, of Irvine, was named in a federal grand jury indictment returned Wednesday charging him with four counts of bank fraud, four counts of wire fraud, one count of aggravated identity theft, and six counts of money laundering.

          Qadiri surrendered to law enforcement this morning and is expected to make his initial appearance this afternoon in United States District Court in Santa Ana.

          According to the indictment, Qadiri claimed to have operated four Newport Beach-based companies, none of which are currently in operation: All American Lending, Inc., All American Capital Holdings, Inc., RadMediaLab, Inc., and Ad Blot, Inc.

          In May and June of 2020, Qadiri allegedly submitted false and fraudulent PPP loan applications to three banks on behalf of those companies. The false information allegedly included the number of employees to whom the companies paid wages, altered bank account records with inflated balances, and fictitious quarterly federal tax return forms. Qadiri allegedly also used someone else’s name, Social Security number and signature to fraudulently apply for one of the loans.

          Relying on this false information, the banks funded the PPP loan applications and transferred approximately $5 million to accounts Qadiri controlled, according to the indictment. Qadiri allegedly used the fraudulently obtained PPP loan proceeds for his own personal benefit, including for expenses prohibited under the requirements of the PPP program, such as the purchase of luxury vehicles, lavish vacations, and the payment of his personal expenses.

          Federal agents have seized the Ferrari, Bentley and Lamborghini cars that Qadiri allegedly purchased with the fraudulently obtained PPP loans, along with $2 million in alleged ill-gotten gains from his bank account.

          The Coronavirus Aid, Relief, and Economic Security (CARES) Act was designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April, Congress authorized more than $300 billion in additional PPP funding.

          The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent. Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within a set time period and use at least a certain percentage of the loan towards payroll expenses.

          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.

          Homeland Security Investigations, the Small Business Administration Office of Inspector General, the FBI and IRS Criminal Investigation investigated this matter as part of the El Camino Real Financial Crimes Task Force.

          Assistant United States Attorney Jennifer L. Waier of the Santa Ana Branch Office is prosecuting this case.

          RIVERSIDE, California – The former CEO of a La Quinta-based communication services company pleaded guilty today to federal criminal charges that he fraudulently obtained $5 million in bank loans by, among other things, submitting sham financial documents that falsely stated his company’s net worth.

          Richard Loren Lewis, 67, of La Quinta, pleaded guilty to a two-count information charging him with bank fraud and making a false statement to a financial institution.

          According to his plea agreement, from April 2013 to April 2016, Lewis schemed to defraud Silicon Valley Bank, a Santa Clara-based commercial bank that funds start-up technology companies.

          Lewis, who was the CEO of Blue Wave Media Inc., and served on its board of directors, fraudulently obtained loans from the bank by preparing and causing to be prepared false financial documents, including balance sheets and income statements, which falsely overstated, among other things, Blue Wave Media’s net worth, liquidity, and revenue.

          Based on the false financial documents, Lewis caused Silicon Valley Bank to approve the loans to Blue Wave Media and deposit the loan proceeds into a bank account he controlled. Lewis’s misrepresentations caused the bank to approve four loans totaling $5 million.

          Lewis admitted he executed the scheme by willfully causing a loan and security agreement to be signed with Silicon Valley Bank in April 2013 to secure a $500,000 loan. In January 2014, he submitted an amendment to the agreement to the bank to secure an additional $500,000 loan. In June 2014, Lewis willfully caused another amendment to the agreement to secure a $1 million loan, and, in April 2015, Lewis signed a third amendment to the agreement with the bank to secure a $3 million loan.

          As a result of Lewis’s fraudulent scheme, Silicon Valley Bank sustained actual losses of approximately $3,414,064, according to the plea agreement.

          United States District Judge John W. Holcomb has scheduled a July 30 sentencing hearing, at which time Lewis will face a statutory maximum sentence of 30 years in federal prison.

          The FBI investigated this matter.

          Assistant United States Attorney Robert S. Trisotto of the Riverside Branch Office is prosecuting this case.

          LOS ANGELES – A San Pedro man was sentenced today to 132 months in federal prison for being the gunman in a violent, takeover-style robbery of a Gardena credit union, where an employee helped with the planning and execution of the heist.

          Toyrieon Sessions, 30, a.k.a. “Phat” and “PhatStax,” was sentenced by United States District Judge André Birotte Jr.

          During a four-day trial in June 2019, a jury found Sessions guilty of three felonies in relation to the robbery of the Northrop Grumman Federal Credit Union (NGFCU) on April 21, 2017: conspiracy to commit armed bank robbery, armed bank robbery, and brandishing a firearm in furtherance of a crime of violence.

          The robbery also involved two conspirators who previously have been convicted for their roles in the robbery:

• Daronnie Thompkins, 32, of the Gramercy Park neighborhood of Los Angeles, who recruited Sessions to be the gunman and knew the credit union’s layout; and
• Iris Lester, 28, of Inglewood, a NGFCU employee who was Thompkins’ girlfriend at the time and who assisted with the robbery.

          On the day of the robbery, Sessions entered the office building in which the credit union is located and walked past NGFCU’s main entrance, entering a side hallway where the NGFCU’s bathrooms were located. Sessions waited in the men’s restroom until Lester and another NGFCU employee exited the women’s bathroom, which was the signal for the robbery to begin. At that point, Sessions left the men’s bathroom, brandished a semi-automatic handgun and used it to force Lester, who was pretending to be a victim, and the other employee to provide access to the credit union’s vault room.

          Once inside the vault room, Lester and the other NGFCU employee realized they did not have the key to open the vault. Sessions allowed Lester to exit the vault room – but, instead of escaping, Lester returned with another credit union employee who was supposed to have the vault key. Lester then left the room a second time and retrieved the keys.

          When Lester returned, Sessions ordered her and the two other credit union employees onto their knees while pointing the handgun at each of them – an experience that “terrorized the victims…and left them…deeply traumatized,” prosecutors wrote in their sentencing memorandum.

          Sessions stole a total of $311,300 from the credit union and placed the cash in a black trash bag before exiting the vault room and fleeing the scene in a silver Dodge Avenger.

          During an August 2018 bench trial, Thompkins was convicted of conspiracy and armed bank robbery. Judge Birotte later sentenced him to nine years in federal prison. Lester pleaded guilty to criminal charges in this case. Her sentencing hearing is scheduled for June 18.

          The FBI and the Los Angeles Police Department investigated this matter.

          Assistant United States Attorneys Jeffrey M. Chemerinsky and Bruce K. Riordan of the Violent and Organized Crime Section prosecuted this case.

          LOS ANGELES – A San Gabriel Valley man who drove his truck into a crowd of peaceful demonstrators last year in Pasadena has agreed to plead guilty to a series of federal firearms offenses, including illegally obtaining and transporting weapons, and possessing short-barreled rifles.

          Benjamin Jong Ren Hung, 28, a San Marino resident who also has a home in Lodi, entered into a plea agreement with prosecutors that was filed today in United States District Court. Hung agreed to plead guilty to 11 felony offenses – including conspiracy, transporting and receiving firearms across state lines, making false statements during purchases of firearms, and possession of unregistered firearms – charged in a superseding information that was also filed today.

          Hung admitted to participating in a multi-year conspiracy to make false statements to firearms dealers in Oregon and to illegally transport those firearms to California. Hung provided cash to a co-conspirator in Oregon to buy handguns for Hung and to falsely state that the co-conspirator was the actual buyer, rather than Hung. The co-conspirator then delivered the firearms to Hung in California. In his plea agreement, Hung admitted that he engaged in the scheme to obtain the firearms and “evade California’s firearms registration laws.”

          Hung also admitted to making false statements to firearms dealers in Washington in connection with his purchase of four rifles and one shotgun in March 2020. When he purchased the firearms, Hung falsely attested that he was a resident of Washington, rather than California, which was material because, as Hung admitted in the plea agreement, “the firearms dealers were not legally permitted to sell firearms to California residents.” Hung also agreed to plead guilty to illegally transporting those firearms to California.

          Hung further admitted he illegally possessed three unregistered short-barreled semiautomatic rifles, which authorities seized from his residence in Lodi in September 2020.

          In the plea agreement, Hung admitted bringing one of his illegally obtained firearms, a Glock 26 9mm handgun, to counterprotest in Old Town Pasadena against a group who had gathered on May 31, 2020, to protest against inequitable treatment of minorities by police, including the death of George Floyd at the hands of a police officer in Minneapolis. Hung, who was driving a customized Dodge pickup truck with vanity license plates reading “WAR R1G,” accelerated toward an intersection where the protest was taking place, sounded a train horn installed on the truck, came to a stop, and then continued through the intersection. As he drove past the demonstrators, Hung caused the truck to emit a large amount of exhaust in what is sometimes called “coal rolling.” No protesters were injured during the incident.

          Hung was detained by local police following his confrontation with the demonstrators, and the FBI then took over the investigation.

          A date for Hung to appear in court to formally enter the guilty pleas has not yet been set.

          This matter was investigated by the FBI’s Los Angeles Joint Terrorism Task Force, FBI civil rights squads and the Pasadena Police Department.

          This case is being prosecuted by Assistant United States Attorneys Frances S. Lewis of the Public Corruption and Civil Rights Section, and David T. Ryan of the Terrorism and Export Crimes Section.

          SANTA ANA, California – A Salvadoran national – who was previously deported after being convicted of sexually abusing a minor – was sentenced today to 240 months in federal prison for distributing child pornography on Facebook’s Messenger after he illegally reentered the United States.

          Jose Ramon Aguilar-Moreno, 52, of Fontana, was sentenced by United States District Judge David O. Carter.

          Aguilar-Moreno pleaded guilty in July 2020 to one count of distribution of child pornography and one count of failure to register as a sex offender.

          In August 2002, Aguilar-Moreno was convicted in San Bernardino County Superior Court of committing lewd and lascivious acts on a minor. Following his deportation in June 2003, he unlawfully returned to the United States in 2016. Since that time, he failed to register as a sex offender in California or anywhere else in the United States, which was required because of his 2002 conviction.

          In June 2018, Aguilar-Moreno used the name “Abel Aguilar” on the Messenger application to distribute three videos that depicted minors engaged in sexually explicit conduct.

          Law enforcement in June 2019 executed a search warrant at Aguilar-Moreno’s residence – which was across the street from an elementary school – and discovered over 900 still image and more than 1,200 videos of child pornography on his cell phones. Aguilar-Moreno’s child pornography “collection spans the gamut and is documentation of some of the most demeaning abuse inflicted on victims of child pornography,” prosecutors wrote in a sentencing memo filed with the court.

          In the sentencing memo, prosecutors noted that Aguilar-Moreno also used WhatsApp to welcome individuals to “the world of child pornography” as he solicited the exchange of images and videos. Aguilar-Moreno chatted with individuals in at least 14 countries, meaning “His reach and impact truly was global,” prosecutors wrote.

          In addition to the prison sentence, Judge Carter ordered Aguilar-Moreno to pay $60,000 in restitution to the victims depicted in the child pornography in this case.

          Homeland Security Investigations and the United States Marshals Service investigated this matter.

          Assistant United States Attorney Eli A. Alcaraz of the Riverside Branch Office prosecuted this case.

          LOS ANGELES – An Inglewood woman and her mother-in-law, who both ran a South Los Angeles drug-and-alcohol abuse treatment program, were sentenced today to federal prison for scheming to defraud Medi-Cal out of over $500,000 for services to clients who did not medically need substance abuse treatment and for services that were never provided.

          Mesbel Mohamoud, 48, was sentenced to 18 months’ imprisonment by United States District Judge Philip S. Gutierrez, who also sentenced Mohamoud’s mother-in-law, Erlinda Abella, 66, also of Inglewood, to one year and one day in federal prison. Each woman was ordered to pay $260,101 in restitution.

          Mohamoud and Abella pleaded guilty in November 2020 to one count of health care fraud.

          Mohamoud was the owner and executive director of The New You Center Inc. (TNYC), located in the Vermont Knolls neighborhood of South Los Angeles. Abella, who co-founded TNYC with Mohamoud in 2005, was the company’s program director. TNYC was authorized to provide medically necessary substance abuse treatment services through the Drug Medi-Cal program to adults and teenagers in Los Angeles County.

          From January 2009 to December 2015, TNYC submitted false and fraudulent claims for counseling sessions that were not conducted at all, were not conducted at authorized locations, or did not comply with Drug Medi-Cal regulations regarding the length of sessions or the number of clients.

          Mohamoud and Abella also caused TNYC to bill for clients who did not have a substance abuse problem, to falsify documents related to services supposedly provided to clients, and to forge client signatures on documents such as sign-in sheets.

          In September 2013, TNYC submitted a fraudulent claim for Medi-Cal reimbursement in the amount of $62.15 for a three-hour counseling session for a client on August 17, 2013 – the same day when the client was hospitalized and did not receive any counseling from TNYC.

          In her plea agreement, Mohamoud admitted she knew that Abella directed TNYC counselors to enroll clients in TNYC’s substance abuse treatment program even if the clients had used drugs or alcohol only occasionally or even just once.

          TNYC submitted approximately $527,313 in false and fraudulent claims for group and individual substance abuse counseling services and was paid $260,101 on those claims.

          The FBI, the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse, and the U.S. Department of Health and Human Services, Office of Inspector General investigated this matter.

          Assistant United States Attorney Cathy J. Ostiller of the Major Frauds Section prosecuted this case.

            LOS ANGELES – A former Orange County resident pleaded guilty Tuesday for his role in a scheme to defraud the government of Afghanistan out of more than $100 million. The funds were provided to Afghanistan by the U.S. Agency for International Development (USAID) for the purpose of constructing an electric grid in Afghanistan, in connection with the long-standing U.S. effort to strengthen that country’s basic infrastructure.

            Saed Ismail Amiri, 38, who currently lives in Granite Bay, but until last year was a resident of Irvine, pleaded guilty to one count of wire fraud before United States District Judge Stanley Blumenfeld Jr.

            According to court documents unsealed Tuesday afternoon, Amiri was at various times either the owner or senior consultant of Assist Consultants Incorporated (ACI), an Afghan company that had received over $250 million in U.S.-funded contracts since 2013. In or around January 2015, USAID, in connection with the U.S. effort to assist Afghanistan and its people, authorized the national power utility of Afghanistan, Da’ Afghanistan Breshna Sherkat (DABS), to solicit bids on a U.S.-funded contract to construct five electric power substations to connect Afghanistan’s Northeastern and Southeastern electric grid systems. Bids were sought only from companies that had substantial experience building electric power substations. Specifically, the contract criteria required bidders, such as ACI, to have previously worked on two electric substations of 220 kilovolts or more.

            In 2015 and 2016, Amiri, ACI employees and others engaged in a scheme to obtain the contract by submitting a false work history and fraudulent supporting documents to deceive DABS into believing that ACI met the required contract criteria.

            Specifically, in July 2015, ACI submitted a bid on the contract for $112,292,241, underbidding its competitors by more than $20 million. In its bid, ACI stated that it had worked as a subcontractor to a prime contractor on two 220 kilovolt substations for a cement factory in Uganda and a textile company in Nigeria. In fact, the alleged prime contractor was a fictitious company that ACI had invented and controlled, ACI had never worked to build a substation in Africa, and neither the Ugandan cement factory nor the Nigerian textile company existed.

            In February 2016, after Amiri had returned to Irvine, DABS contacted ACI and requested supporting documents to verify ACI’s work history. Amiri then sent emails to co-conspirators outside California, including emails in which he advised that some of them would need to go to Uganda and Nigeria to obtain false documents to respond to DABS. Amiri thereafter departed the United States and, in furtherance of the scheme, emailed documents to DABS he knew were false and altered, including ACI’s purported subcontract to work on the Ugandan substation, coordinates of the substation, photographs, false bank records, and a false letter purporting to be from a Ugandan government official.

            After submitting the fake records to DABS, Amiri met with U.S. law enforcement at the U.S. Embassy in Afghanistan and falsely stated, among other things, that he had learned the prior month that ACI had bid on the contract. Shortly thereafter, Amiri withdrew ACI’s bid. In a subsequent interview with law enforcement, Amiri also falsely stated that another ACI employee had submitted the false documents to DABS, when, in truth and in fact, Amiri had emailed the false documents himself.

            Amiri is scheduled to be sentenced by Judge Blumenfeld on August 10, at which time he will face a maximum penalty of 20 years in federal prison. Judge Blumenfeld will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

            This matter was investigated by the Special Inspector General for Afghanistan Reconstruction and the USAID Office of Inspector General.

            Assistant United States Attorney Jeff Mitchell of the Major Frauds Section and DOJ Trial Attorney Matt Kahn of the Criminal Division’s Fraud Section are prosecuting the case.

          LOS ANGELES – Law enforcement this morning arrested 19 defendants, most of whom are members and associates of the Bounty Hunter Bloods (BHB) street gang named in a series of federal grand jury indictments charging them with manufacturing and distributing crack cocaine in and around their “territory” of the Nickerson Gardens public housing projects in the Watts neighborhood of the City of Los Angeles.

          The 19 people arrested this morning are among 22 defendants charged in nine indictments unsealed today that allege violations of federal narcotics and firearms laws. The defendants arrested today are expected to be arraigned on the indictments this afternoon in United States District Court in downtown Los Angeles.

          In addition to those arrested during “Operation Loyalty Matters,” one defendant is already in custody on unrelated charges. Authorities are continuing to search for two defendants.

          During the investigation, law enforcement seized 26 firearms – including five “ghost guns,” or firearms lacking serial numbers – 1 kilogram of crack cocaine and 12 pounds of methamphetamine.

          The case’s main indictment centers on the alleged drug manufacturing and distributing activities of Damion Baker, 43, a.k.a. “Fatts,” and Tony Carr, 49, a.k.a. “T-Bone,” both of whom are documented Watts-based BHB gang members. The 15-count indictment also charges Baker’s alleged network of narcotics suppliers, manufacturers, and distributors.

          From August 2019 to May 2020, Baker obtained powder cocaine from suppliers and, along with Carr, manufactured or “cooked” crack cocaine in Nickerson Gardens, then prepared and packaged crack cocaine for other distributors and customers in the housing complex, according to the indictment. The conspirators allegedly collected proceeds from the crack cocaine sales after distributing the drugs to customers via hand-to-hand transactions.

          “Because of the highly dangerous and lucrative nature of crack cocaine trafficking, individuals who worked together in the distribution of crack cocaine often had established relationships through their membership or association with the BHB,” the indictment alleges.

          Baker, Carr and the indictment’s 10 other defendants are charged with one count of conspiracy to manufacture, distribute and possess with intent to distribute crack cocaine. Baker faces eight additional felony charges in the indictment, while Carr is charged with six additional felonies, including narcotics distribution and firearms-related offenses.

          The remaining eight indictments charge an additional 10 defendants with violating federal narcotics and firearms laws.

          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.

          Fourteen defendants, including all 12 defendants charged in the lead indictment, face potential sentences of life imprisonment if they are convicted of conspiracy to distribute more than 280 grams of crack cocaine, and they potentially face mandatory minimum sentences of 10 years in federal prison for that offense. Four additional defendants face mandatory minimum sentences of five years in federal prison if convicted of charges of conspiracy to distribute 28 grams or more of crack cocaine, and possession of a firearm in furtherance of a drug trafficking crime.

          Today’s arrests were made by the FBI’s Los Angeles Metropolitan Task Force on Violent Gangs, which consists of the FBI, the Los Angeles Police Department, the Los Angeles County Sheriff’s Department, and the California Department of Corrections and Rehabilitation.

          Assistant United States Attorney Amy E. Pomerantz of the Violent and Organized Crime Section is prosecuting this case.

            SANTA ANA, California – A federal grand jury today returned an indictment that charges a Covina man with kidnapping his wife in 2016 in an incident that resulted in her death.

            Eddy Reyes, 35, who lived with his wife in Santa Ana when she was last seen, was arrested in this case on April 15 pursuant to a criminal complaint that also charged him with kidnapping.

            Reyes, an employee of U.S. Customs and Border Protection who has been held without bond since his arrest, is scheduled to be arraigned on the indictment on May 3 in United States District Court in Santa Ana.

            The indictment alleges that Reyes kidnapped his wife, 21-year-old Claudia Sanchez Reyes, on May 6, 2016.

            According to court documents, Claudia Reyes was last seen leaving work on the night of May 6, 2016. After Reyes filed a missing person report four days later, the Santa Ana Police Department conducted an investigation that revealed co-workers heard Claudia Reyes fighting with her husband on May 6 soon before he picked her up in a rented SUV, according to the affidavit in support of the criminal complaint, which notes detectives later found a drop of Claudia Reyes’ blood in that vehicle and a cadaver dog indicated that a dead body had been in the SUV.

            The affidavit also documents a history of alleged domestic abuse by Reyes against his wife, including several threats to kill her, as well as temporary restraining orders Claudia Reyes obtained against her husband in 2014 and 2016.

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

            If he were to be convicted of the charge of kidnapping resulting in death, Reyes would face potential sentences of the death penalty or life in federal prison without parole.

            The investigation in this matter is being conducted by the Orange County Violent Gang Task Force, which is comprised of several federal, state and local agencies.

            Assistant United States Attorneys Gregory W. Staples and Daniel H. Ahn of the Santa Ana Branch Office are prosecuting this case.

A California man pleaded guilty Tuesday for his role in a scheme to defraud the government of Afghanistan of over $100 million. These funds were provided to Afghanistan by the U.S. Agency for International Development (USAID) for the purpose of constructing an electric grid in Afghanistan, in connection with the long-standing U.S. effort to strengthen that country’s basic infrastructure.

According to court documents, Saed Ismail Amiri, 38, of Granite Bay, was at various times either the owner or senior consultant of Assist Consultants Incorporated (ACI), an Afghan company that had received over $250 million in U.S. funded contracts since 2013. In or around January 2015, USAID, in connection with the U.S. effort to assist Afghanistan and its people, authorized the national power utility of Afghanistan, Da’ Afghanistan Breshna Sherkat (DABS), to solicit bids on a U.S. funded contract to construct five electric power substations to connect Afghanistan’s Northeastern and Southeastern electric grid systems. Bids were sought only from companies that had substantial experience building electric power substations. Specifically, the contract criteria required bidders, such as ACI, to have previously worked on two electric substations of 220 kilovolts or more.

In 2015 and 2016, Amiri, ACI employees, and others engaged in a scheme to obtain the contract by submitting a false work history and fraudulent supporting documents in an effort to deceive DABS into believing that ACI met the required contract criteria. More specifically, in July 2015, ACI submitted a bid on the contract for $112,292,241.05, and ACI underbid its competitors by more than $20 million. In the bid, ACI stated that it had worked as a subcontractor to a prime contractor on two 220 kilovolt substations for a cement factory in Uganda and a textile company in Nigeria. In fact, the alleged prime contractor was a fictitious company that ACI had invented and controlled, ACI had never worked to build a substation in Africa, and neither the Ugandan cement factory nor the Nigerian textile company existed.

In February 2016, Amiri returned to his residence in the Los Angeles area, at which time DABS had contacted ACI and requested supporting documents to verify ACI’s work history. Amiri then sent emails to co-conspirators outside California, including emails in which he advised that some of them would need to go to Uganda and Nigeria to obtain false documents to respond to DABS. Amiri thereafter departed the United States and, in furtherance of the scheme, emailed DABS documents he knew were false and altered, including ACI’s purported subcontract to work on the Ugandan substation; coordinates of the substation; photographs; false bank records; and a false letter purporting to be from a Ugandan government official. After submitting the fake records to DABS, Amiri met with U.S. law enforcement at the U.S. Embassy in Afghanistan. During that meeting, Amiri falsely stated, among other things, that he had learned the prior month that ACI had bid on the contract. Shortly thereafter, Amiri withdrew ACI’s bid. In a subsequent interview with law enforcement, Amiri also falsely stated that another ACI employee had submitted the false documents to DABS, when in truth and in fact, Amiri had emailed the false documents himself.

Amiri pleaded guilty to wire fraud. He is scheduled to be sentenced at a later date and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division; Acting U.S. Attorney Tracy Wilkison of the Central District of California; Inspector General John F. Sopko of the Special Inspector General for Afghanistan Reconstruction (SIGAR); and Acting Inspector General Thomas J. Ullom of the USAID Office of Inspector General (USAID-OIG) made the announcement.

SIGAR and USAID-OIG are investigating the case.

Trial Attorney Matt Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Jeff Mitchell of the Central District of California are prosecuting the case.

          LOS ANGELES – A federal grand jury in Los Angeles has indicted two Los Angeles-area men on conspiracy and hate crime offenses for allegedly attacking five victims at a family-owned Turkish restaurant while shouting anti-Turkish slurs, hurling chairs at the victims and threatening to kill them.

          The indictment was unsealed today following the arrest this morning of Harutyun Harry Chalikyan, 23, of Tujunga, who is scheduled to be arraigned this afternoon in United States District Court in Los Angeles.

          The second defendant in the case – William Stepanyan, 23, of Glendale – is currently in state custody and is expected to appear in federal court in this case in the coming weeks.

          Chalikyan and Stepanyan, both of whom are Armenian-American, are charged with one count of conspiracy and five hate crimes.

          According to the indictment, Stepanyan sent a text message on November 4, 2020, saying that he planned to go “hunting for [T]urks.” Later that day, Stepanyan met with Chalikyan and other Armenian-Americans to protest what they considered to be Turkish aggression against Armenians, express their contempt for Turkey and show their support for Armenia.

          Stepanyan, Chalikyan and other Armenian-Americans then drove to the family-owned restaurant, where Stepanyan and Chalikyan stormed into the restaurant and attacked the victims inside, the indictment alleges. Stepanyan and Chalikyan, who were both wearing masks during the attack, allegedly flung chairs at the victims while shouting derogatory slurs about Turkish people. Four of the five victims were of Turkish descent.

          The indictment further alleges that at least one of the defendants threatened to kill the victims, shouting: “We came to kill you!  We will kill you!”

          During the attack, multiple victims were injured, including one individual who lost feeling in their legs and collapsed multiple times due to the injury, the indictment states. After the victims escaped, Stepanyan and Chalikyan allegedly continued to destroy the restaurant, ultimately causing over $20,000 in damage, forcing the restaurant to close temporarily and causing thousands of dollars in lost revenue.

          An indictment is merely an allegation, and the defendants are presumed innocent unless proven guilty in a court of law.

          If convicted, Stepanyan and Chalikyan each would face a maximum penalty of 10 years in prison for the hate crime charges and five years in prison for the conspiracy charge.

          The FBI conducted the investigation in this matter and received substantial assistance from the Beverly Hills Police Department.

          Assistant United States Attorney Lindsey Greer Dotson of the Public Corruption and Civil Rights Section, and Trial Attorney Michael J. Songer of the Justice Department’s Civil Rights Division are prosecuting the case.