Eastern District of California

FRESNO, Calif. — A federal grand jury returned a four-count indictment today against Fresno residents Armando Perez, 50, and Christian Sandoval, 22, charging them with conspiracy to distribute and possess with intent to distribute methamphetamine and possession with intent to distribute methamphetamine, United States Attorney Benjamin B. Wagner announced.

According to court documents, on April 9, 2015, Perez provided an undercover officer with approximately one ounce of methamphetamine. On April 21, 2015, Perez provided the undercover officer with approximately one pound of methamphetamine. On May 7, 2015, Sandoval drove Perez to a meeting with an undercover officer, and Perez provided the officer with approximately 10 pounds of methamphetamine.

This case is the product of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation involving the Drug Enforcement Administration and Fresno County Sheriff’s Office. OCDETF is a program that facilitates joint investigative work by federal, state, and local law enforcement agencies. Assistant United States Attorney Kimberly A. Sanchez is prosecuting the case.

If convicted, Perez faces a maximum statutory penalty of life in prison and a $35 million fine. Sandoval is facing a maximum penalty of 20 years in prison and a $1 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; each defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — Marquist Piere Bradford, 29, of Chicago, was sentenced today to 10 and a half years in prison for sex trafficking of minors, U.S. Attorney Benjamin B. Wagner announced.

According to court documents, Bradford recruited a 15-year-old girl to travel from Fresno to Sacramento where she was used by Bradford as part of a prostitution business from January 19 through February 5, 2012. Bradford maintained an apartment in Rancho Cordova that he used as a base of operations for a prostitution business that spanned the Sacramento and Bay areas, as well as cities outside California. At least two of Bradford’s victims were under the age of 18. Bradford fled from Sacramento to the Chicago area after he became aware of law enforcement’s investigation of this case.

US Attorney Wagner stated: “The U.S. Attorney’s Office is committed to ensuring that the weakest and most vulnerable in our society receive the full protections to which they are entitled as Americans. Few are weaker and more vulnerable than the child victims of commercial sexual exploitation. This office is attacking the problem with federal, state and local law enforcement agencies. Since the beginning of 2011, 20 defendants have been sentenced in federal court for this offense with sentences ranging from five to 50 years in prison.”

“Exploiters like Bradford profit from trafficking vulnerable minors, using violence and threats to control the victims,” said Supervisory Special Agent Maria Johnson of the FBI's Sacramento field office. “The FBI and our task force partners are committed to recovering exploited minors and ensuring their traffickers face justice.”

Sacramento County Sheriff Scott Jones stated: “This resolution demonstrates the commitment of the Sacramento County Sheriff's Department in combatting human trafficking in our region, and the importance of ongoing collaborations between law enforcement agencies on all levels. Crimes involving human trafficking and the Internet occur in a dynamic environment that requires advanced investigative techniques. This case was an opportunity to stem the flow of crimes affecting human trafficking victims nationwide.”

This case was the product of an investigation by the Sacramento FBI Innocence Lost Task Force and the Sacramento County Sheriff’s Department. Assistant United States Attorney Matthew G. Morris prosecuted the case.

SACRAMENTO, Calif. — The United States Attorney’s Office announced today that Attorney General Loretta E. Lynch has appointed U.S. Attorney Benjamin B. Wagner to serve as co-chair of the White Collar/Fraud Subcommittee of the United States Department of Justice’s Attorney General’s Advisory Committee (AGAC).

Created in 1973, the AGAC provides advice and counsel to the Attorney General and other senior leaders in the U.S. Department of Justice on policy, management and operational issues, helping to shape policies to accomplish the Department’s core mission of serving justice. The White Collar/Fraud Subcommittee reports to the AGAC and represents the voice of the 93 U.S. Attorneys in matters relating to white collar crime. U.S. Attorney Wagner’s co-chair on the White Collar/Fraud Subcommittee is Melinda Haag, the U.S. Attorney for the Northern District of California.

Wagner previously served for three years on the AGAC after being appointed by Attorney General Eric Holder in May 2010. Wagner continues to serve on several AGAC subcommittees, including those focusing on Civil Rights and Terrorism and National Security.

SACRAMENTO, Calif. — United States Attorney Benjamin B. Wagner is pleased to announce the 2014 winner of the Eastern District of California Law Enforcement Award for Outstanding Investigator in the Sacramento Division. This award is one of four awards presented annually to a law enforcement agency and an officer in the Sacramento and Fresno divisions of the Eastern District of California to recognize outstanding collaboration between federal, state, and local law enforcement in addressing public safety issues in this region.

The winner of Sacramento Division’s Outstanding Investigator Award is Sacramento Police Detective Derek Stigerts for his work investigating crimes involving the sex trafficking of minors. Over the years, Detective Stigerts has worked on some of the most significant sex trafficking cases prosecuted by the U.S. Attorney’s Office. Two of those cases were brought against violent pimps Deandre Brown and Steven McKesson and resulted in lengthy federal prison sentences. Just last year, Detective Stigerts was instrumental in the conviction of Percy Love, a sex trafficker currently awaiting sentencing by the district court. None of those results would have been possible without Detective Stigerts’ dedication and expertise. He is a nationally recognized expert on sex trafficking crimes, and he frequently provides training to other law enforcement agencies. Even more important is Detective Stigerts’ unseen work with the victims of these crimes, helping them to reach the point where they can tell their stories and move forward with their lives.

U.S. Attorney Wagner stated: “It is my honor to recognize Derek Stigerts for the incredibly difficult and important work that he does. He brings some of our most dangerous criminals to justice, and he protects and assists some of the most vulnerable members of our community. It is because of Derek’s and his colleagues’ hard work that the Eastern District of California is seen as a national leader in the investigation and prosecution of the commercial exploitation of children. We thank him for his service.”

Earlier this year, two of the 2014 awards were presented to the Tehama County Sheriff’s Office and the Fresno County Sheriff’s office for their outstanding work in cooperation with the U.S. Attorney’s Office. The fourth and final award winner will be announced next week.

SACRAMENTO, Calif. — Alejandro Soto-Silva, 24, a Mexican national, was sentenced today by United States District Judge Kimberly J. Mueller to one year and six months in prison and restitution of $9,572 for growing marijuana and for depredation of public lands, United States Attorney Benjamin B. Wagner announced.

According to court documents, on July 30, 2014, a team of Plumas County Sheriff’s Office deputies and U.S. Forest Service agents raided a large marijuana cultivation site near the Soda Creek drainage on the Plumas National Forest. After entering the marijuana cultivation site, agents and deputies observed Soto-Silva nearby. Shortly after spotting Soto-Silva, deputies and agents arrested him in an area of the marijuana cultivation site used to process marijuana. Close to where they arrested Soto-Silva, law enforcement observed 30-40 pounds of processed marijuana in black plastic bags.

Law enforcement surveyed the marijuana cultivation site and counted 3,724 growing marijuana plants. They also documented habitat destruction to the Plumas National Forest caused by activities associated with marijuana cultivation, including trail building, forest clearing, irrigation, pesticide use, and extensive garbage throughout the cultivation site. Further, law enforcement observed water being diverted from forest waterways in order to cultivate marijuana. Rehabilitating and remediating the National Forest habitat injured by the marijuana cultivation will cost the U.S. Forest Service at least $9,572.

This case was the product of an investigation by the Plumas County Sheriff’s Office and the U.S. Forest Service. Assistant United States Attorney Christiaan Highsmith prosecuted the case.

FRESNO, Calif. —Arnoldo Delgado Garcia (Delgado), aka Fabricio Rene Delgado-Perea, 35, a Mexican national, pleaded guilty on Monday to conspiring to distribute and possess with intent to distribute methamphetamine and heroin, and in the same case Erik Gesus Rivera, 28, of Bakersfield, pleaded guilty to possession with intent to distribute methamphetamine, United States Attorney Benjamin B. Wagner announced.

According to court documents, from May 2013 through January 2014, Delgado and Rivera regularly distributed methamphetamine and heroin to various drug dealers and users in Kern County. During this time period, Delgado admitted that he distributed between 15 and 45 kilograms of methamphetamine and over 1,000 grams of a mixture or substance containing a detectable amount of heroin. Rivera admitted in his plea agreement that he was involved in the distribution of between 15 and 45 kilograms of methamphetamine, and on January 29, 2014, he was found to be in possession of over a pound of crystal methamphetamine and several ounces of heroin that were intended for distribution. According to the plea agreement, Delgado was the supplier for co-conspirator Jose Cruz, 28, of Bakersfield. On April 27, 2015, Cruz pleaded guilty to the conspiracy charge.

This case is the product of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Drug Enforcement Administration, Kern County Sheriff’s Office, and the Southern Tri-County High Intensity Drug Trafficking Area Task Force. Assistant United States Attorney Brian K. Delaney is prosecuting the case.

Cruz is scheduled to be sentenced by United States District Judge Lawrence J. O'Neill on July 20, 2015. Delgado and Rivera are scheduled to be sentenced by Judge O'Neill on August 3, 2015. Cruz and Delgado face a maximum statutory penalty of life in prison and a $10 million fine. Rivera faces a maximum statutory penalty of 40 years in prison and a $5 million fine. The actual sentences, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

FRESNO, Calif. — Marie E. Sherrill, 54, of Porterville, was arrested today on a 34‑count indictment charging her with wire fraud, money laundering, aiding the preparation of false tax returns, and corruptly interfering with the administration of the internal revenue laws, United States Attorney Benjamin B. Wagner announced.

According to court documents, Sherrill was a registered tax return preparer operating a bookkeeping and tax preparation business in Porterville under the name Sherrill Financial Services. Between January 2011 and December 2014, Sherrill allegedly prepared false tax returns for her clients containing false deductions to maximize their tax refunds, causing an alleged loss to the IRS of $255,901. She allegedly attempted to obstruct IRS audits of her tax-clients and prepared and filed tax returns using someone else’s electronic filing number.

The indictment also alleges that Sherrill used the intimate financial knowledge she gained about her various clients to identify potential victims she could lure into an investment fraud scheme. She allegedly told victims of this scheme that their money would be put into “pooled investments” with the money of other investors, to earn a high rate of return. The money was, in fact, never put into any investment, but was used instead to pay Sherrill’s personal expenses or to make lulling payments to earlier investors, to make them believe their money was earning a profit. The indictment alleges that as a result of this scheme, at least 17 investment victims were defrauded of at least $1.3 million.

This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation. Assistant United States Attorney Mark J. McKeon is prosecuting the case.

If convicted, Sherrill faces a maximum statutory penalty of 20 years in prison on each count of wire fraud; 10 years in prison on each count of money laundering; and three years in prison on each tax charge. She also faces a $250,000 fine on each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. —Sippy Lal, 62, of Sacramento, was sentenced to two years in prison today for conspiring to induce aliens to illegally enter the United States for private financial gain, United States Attorney Benjamin B. Wagner announced.

According to court documents, from at least October 24, 2006, until January 10, 2012, Lal and co-defendants Mamta Sharma, 37, and Rani Singh-Lal, 30, both of Sacramento, were involved in an elaborate immigration-fraud scheme involving foreign nationals from India who paid to enter into sham engagements or marriages with locally recruited U.S. citizens in an effort to legalize their immigration status. The citizens recruited by Lal were paid thousands of dollars to fly to India, meet and take pictures with a purported spouse, and sometimes enter into actual marriages (albeit often using aliases). Thereafter, fraudulent petitions were filed with the United States seeking visas allowing the Indian citizens to enter and reside within the United States. On at least one occasion, after an alien entered the country on a fraudulent fiancé visa procured through the scheme, Lal paid a U.S. citizen to further participate by entering into a sham marriage with the alien in Sacramento.

Sharma used various aliases to pose as a U.S. citizen in five different petitions filed since 2008, despite the fact that she is not a U.S. citizen and despite the fact that she was married to Lal throughout that time period. Similarly, Singh-Lal posed as the petitioner in three different petitions, all filed with slight variations of her true name. According to court documents, over 25 fraudulent petitions were submitted to immigration authorities as a result of the conspiracy, and at least nine Indian nationals entered the United States and were, at least for some period of time, able to avoid detection.

“At U.S. Citizenship and Immigration Services, a team of three fraud officers looked into the allegations, and developed information to provide to Immigration and Customs Enforcement that helped to get an admission of guilt,” said District Director Mari Carmen Jordan.

“Marriage fraud is not a storyline for a Hollywood movie, it’s a federal crime, and unfortunately one that is all too common,” Tatum King, acting special agent in charge for ICE Homeland Security Investigations (HSI) in northern California. “As this case makes clear, HSI will aggressively target those who conspire to corrupt the integrity of America’s legal immigration system for personal profit, putting our nation’s security at risk in the process.”

Sharma and Singh-Lal previously pleaded guilty and were sentenced to of 24 months and 27 months in prison, respectively.

This case was the product of an investigation U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), United States Citizenship and Immigration Services – Fraud Detection and National Security Unit, and the California Department of Justice – Bureau of Investigation and Intelligence. Assistant United States Attorneys Michele Beckwith and Philip Ferrari prosecuted the case.

FRESNO, Calif. — Fresno residents Michael Anthony Andrade, 34, and Javier Solis, 29, pleaded guilty today to sex trafficking of a minor, United States Attorney Benjamin B. Wagner announced.

According to court documents, Andrade and Solis forced two girls, ages 15 and 17, to prostitute themselves first in Fresno and then in San Luis Obispo. In addition, the 15‑year-old girl was taken to a tattoo parlor in Fresno where the defendants’ nicknames were tattooed on her, one name on each shoulder.

Court documents further reflect the 17-year-old, a runaway, spoke with Fresno Police officers on October 24, 2013, after her mother brought her home from San Luis Obispo. While being interviewed, she told officers about the 15-year-old who was still in San Luis Obispo under the control of the defendants as well as the motel where she was staying. In response, the San Luis Obispo Police Department was contacted, and officers were able to successfully remove her from that location.

Solis is scheduled to be sentenced on August 10, 2015, and Andrade is scheduled to be sentenced on August 17, 2015. Each faces a sentence of 10 years to life in prison and a $250,000 fine. The actual sentences, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case is the product of an investigation by the Federal Bureau of Investigation, the Fresno Police Department, the San Luis Obispo Police Department and the San Luis Obispo District Attorney’s Office. Assistant United States Attorneys Michael Frye and Mia Giacomazzi are prosecuting the case.

SACRAMENTO, Calif. — Peggy Babb, 55, of Lodi, was sentenced today by United States District Judge Troy L. Nunley to seven years and eight months in prison for distribution of methamphetamine and violating the terms of her supervised release, United States Attorney Benjamin B. Wagner announced.

According to court documents, on November 6, 2014, Babb sold approximately 118 grams of crystal methamphetamine to an individual working with law enforcement. She was arrested soon thereafter. At the time of her arrest, Babb was serving a term of supervised release following a nearly 10-year prison term for a federal drug trafficking felony she committed in 2003.

Judge Nunley sentenced Babb to 65 months in prison for methamphetamine distribution and 27 months in prison for violating the terms of her supervised release, which prohibited Babb from engaging in illegal conduct while under Court supervision. Babb has been in custody since her arrest.

This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Lodi Police Department. Assistant United States Attorney Christiaan Highsmith prosecuted the case.

SACRAMENTO, Calif. — After a 12–day trial, a federal jury today found six defendants guilty of all counts of wire fraud in connection with a mortgage fraud scheme, United States Attorney Benjamin B. Wagner announced.

Irina Markevich, 30, of Rio Linda; Anatoliy Markevich, 35, of Sacramento; and Marina Pukhkan, 53, of Rio Linda, were each convicted of two counts of wire fraud. Daniil Markevich, 38; his wife Svetlana Markevich, 38, both of Escondido; and Alex Markevich, 40, of Rio Linda, were each convicted on one count of wire fraud.

According to evidence presented at trial, between February 2007 and March 2008, the defendants each obtained home loans using fraudulent loan applications and related documents that contained false information about their income, assets, bank accounts, and intent to occupy the residences. The proceeds of the fraud scheme were derived from inflated purchase prices and payments for fake construction work that never in fact took place.

All together the defendants obtained over $5 million in home loans for six properties in Roseville, Sacramento, and West Sacramento, and then made only between three and six payments before letting the loans go into default. Although their loan applications claimed that they individually made approximately $190,000 to $426,000 per year, the defendants’ tax returns showed that they actually made only between about $3,000 and $22,000 in 2007, the year they purchased the homes.

Each of the properties purchased by the defendants was foreclosed upon within about one year of the purchase date. For acting as straw buyers in this mortgage fraud scheme, the defendants were collectively compensated hundreds of thousands of dollars and purchased such things as a Lincoln Navigator and a limousine with the proceeds. The total fraud proceeds to them, other family members, and other participants in the scheme was in excess of $700,000.

This case is the product of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation. Assistant United States Attorney Christopher S. Hales and Special Assistant United States Attorney E. Kate Patchen are prosecuting the case.

All of the defendants are scheduled to be sentenced by United States District Judge John A. Mendez on August 11, 2015. Each defendant faces a maximum statutory penalty of 20 years in prison and a $250,000 fine on each count of conviction. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

FRESNO, Calif. — Frank A. Bilan, 66, of Lodi, was arrested today on a three-count indictment charging him with one count of corrupt endeavor to obstruct and impede the administration of the internal revenue laws and two counts of failing to file tax returns, United States Attorney Benjamin B. Wagner announced.

According to court documents, Bilan, who formerly lived in Newman in Stanislaus County, earned income as a salaried engineer and through his engineering consulting business. However, Bilan did not timely file tax returns for tax years 2001 through 2009. When the IRS sent correspondence to Bilan regarding past due taxes, Bilan responded by submitting fictitious financial instruments titled “Money Order” or “Money Order Private Issue” in purported payment of his tax liabilities, attempting to file false purported income tax returns, and falsely reporting on an IRS form the discharge of monies owed by Bilan to the IRS. Bilan also failed to file income tax returns for tax years 2008 and 2009. The indictment alleges that between 2005 and 2009, Bilan received over $900,000 in income.

This case is the product of an investigation by the Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Henry Z. Carbajal III is prosecuting the case.

If convicted of a corrupt endeavor to obstruct and impede the administration of the internal revenue laws, Bilan faces a maximum statutory penalty of three years in prison and a $250,000 fine. The maximum statutory penalty for willful failure to file a tax return is up to one year in prison and a $100,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — Niesha Nicole Jackson, 35, was sentenced today by United States District Judge Kimberly Mueller to 15 years and seven months in prison for bank fraud and failure to appear for sentencing, United States Attorney Benjamin B. Wagner announced. Jackson had failed to appear for sentencing on the bank fraud conviction in 2011 and had been living as a fugitive until April 2014.

On July 30, 2009, a federal grand jury indicted Jackson on one count of conspiracy to commit bank fraud and one count of bank fraud. According to court documents, Jackson was part of a credit card scheme that netted over one million dollars in losses to 37 banks in 2007 and 2008. Operating from California, the scheme’s organizers sent runners to Alabama, Arizona, Illinois, Indiana, Montana, New Mexico, Ohio, Oklahoma, and Texas to use prepaid credit cards at banks for cash advances. Although the cards only had small amounts of money available, the runners would tell the bank tellers to call a toll-free number that was controlled by Jackson or another co-conspirator. Jackson, posing as a card services representative, would mislead the bank employee into believing that there were thousands of dollars available on the card, and then would instruct the teller what buttons to press on the card terminal in order to make the transaction go through. After receiving the cash, the runner would keep a portion, and the rest of the fraudulently obtained funds would go to the organizers in the Sacramento area. Jackson pleaded guilty in March 2010, but then failed to appear at her sentencing.

While she was a fugitive, Jackson was featured on CNBC’s program “American Greed: The Fugitives” and labeled as the “Bank Robbing Babe.” In April 2014, after receiving information that Jackson was in Fairfield, the Pacific Southwest Regional Fugitive Task Force, composed of U.S. Marshals and state and local agencies, set up surveillance and arrested her at a hotel. When Jackson was arrested, she had in her possession jewelry, a Cartier wristwatch, five pairs of luxury-brand shoes, 27 luxury-brand purses, and a T-shirt with “BR Babe” printed on it.

At sentencing today, Jackson addressed the Court and said that she had panicked on the day of her sentencing, and while on the run, she knew that one day it “would all come to an end.” Judge Mueller commented that in 2011, she had been inclined to impose a 10‑year sentence on Jackson, but that today, a longer sentence was necessary to send a message to defendants who might think about absconding. The judge said that even if Jackson had panicked on the day of sentencing, “she had plenty of time to think about it.” Thus, the Court imposed an increased sentence of 12 and a half years for the bank fraud and an additional, consecutive three years and one month for the charge of failure to appear.

This case was the product of an investigation by the U.S. Secret Service and the Federal Bureau of Investigation with assistance from police and sheriff’s departments in several states. Seven other defendants have previously been convicted and sentenced for their roles in the conspiracy. Assistant United States Attorney Matthew D. Segal prosecuted the case.

FRESNO, Calif. — A Shafter man pleaded guilty today to conspiring to import, distribute, and possess with intent to distribute 38 kilograms, or about 84 pounds, of cocaine, United States Attorney Benjamin B. Wagner announced.

Jimmy Gil, aka Joselin Jimelet Gil Sanchez, aka Joselin Gil, aka Gilberto Sanchez, 35, of Shafter, pleaded guilty to conspiring to smuggle cocaine with Jose Luis Montoya-Salazar, aka Rafael Salazar-Sanchez (Montoya), 42, of Mexico City, and Luis Ricardo Eslava-Corral (Eslava), 42, of Sinaloa, Mexico. As part of the plea agreement, Gil will forfeit $3.1 million in cash that drug agents seized during the investigation of the case.

According to court documents, Gil conspired with Eslava, the driver of a tractor trailer containing cocaine smuggled into the United States from Mexico at the Otay Mesa Port of Entry, to a location in Bakersfield. After Gil took possession of the tractor trailer, he and Montoya began unloading 18 one-kilogram packages of cocaine from a hidden compartment in the underside of the tractor trailer and placing the cocaine in Montoya’s vehicle. Gil and Montoya were arrested before they were able to unload 20 more kilograms of cocaine concealed in the tractor trailer. Follow-up investigation resulted in the seizure of $3,104,661 in cash hidden in an asphalt roller at another location in Bakersfield. The seized cocaine has a street value of over $3 million.

Gil is scheduled to appear for sentencing before U.S. District Judge Lawrence J. O’Neill in Fresno on July 27, 2015. Gil faces a mandatory minimum statutory penalty of 10 years in prison, a maximum statutory penalty of life in prison and a $10 million fine. Eslava previously entered a guilty plea and is scheduled for sentencing on May 11, 2015. Any sentence imposed would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges against Montoya are still pending and are only allegations; Montoya is presumed innocent until and unless proven guilty beyond a reasonable doubt. Montoya, if convicted, and Eslava are subject to removal to Mexico after serving any prison sentence imposed.

This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the U.S. Drug Enforcement Administration, Southern Tri-County High Intensity Drug Trafficking Area (HIDTA) task force, Kern County Sheriff’s Office, Tulare County Sheriff’s Office, and Bakersfield Police Department. Assistant United States Attorney Karen Escobar is prosecuting the case.

FRESNO, Calif. — Daniel James Owen, 28, of Fresno, was sentenced today by United States District Judge Anthony W. Ishii to 10 years in prison for possessing child pornography, United States Attorney Benjamin B. Wagner announced.

According to court documents, on December 23, 2012, Owen possessed eight separate images depicting minors engaged in sexually explicit conduct. The images also involved the portrayal of sadistic, masochistic, and other depictions of violence, and included depictions of pre-pubescent minors. Owen pleaded guilty to this charge on February 27, 2015. In light of a prior conviction, Owen faced a minimum statutory sentence of 10 years in prison.

This case was the product of an investigation by the Central California Internet Crimes Against Children Task force, specifically the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Fresno County Sheriff’s Office. Assistant United States Attorney Brian W. Enos prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about Internet safety education.

FRESNO, Calif. — Derik Carson Kumagai, 41, of Fresno, was sentenced today by United States District Judge Anthony W. Ishii to two years in prison for conspiring to commit bribery, United States Attorney Benjamin B. Wagner announced. Kumagai was ordered to self-surrender on June 12 at 2:00 p.m. to begin serving his sentence.

In addition, co-defendant Saykham Somphoune, aka Oat, 41, also of Fresno, was sentenced to time served, which was 13 months in jail for his role in the bribery conspiracy. Both defendants were ordered to pay $13,962 in restitution.

According to court documents, beginning in April 2012, federal law enforcement agents were investigating a group of individuals that included Somphoune and one of his associates, for suspected cultivation and distribution of marijuana. In October and November 2013, Somphoune had a series of meetings with his associate, some of which were attended by Kumagai. At the time, Kumagai was a Fresno Police Department detective in the Vice and Intelligence Unit.

During these meetings, the associate was told that he was under federal investigation, but that in return for a bribe payment, Kumagai could close the investigation and arrange to have the associate designated as a confidential informant for the Fresno Police Department. On November 6, 2013, the associate paid Kumagai approximately $20,000 cash. A few hours later, the associate signed documents for the purported purpose of becoming a confidential informant for the Fresno Police Department. The defendants were arrested in March of 2014, and the associate never actually served as a confidential informant for the Fresno Police Department.

“Former detective Kumagai violated the trust given to him as a law enforcement officer,” said U.S. Attorney Wagner. “He will now spend time in federal prison for his corrupt conduct. It is an important mission of the U.S. Attorney’s Office to prosecute law enforcement officers and other public officials who abuse their official authority for their own personal gain. We will continue to work closely with our law enforcement partners to investigate and prosecute these cases.”

“Such criminal activity tarnishes the reputations of the men and women in law enforcement who are committed to upholding laws that keep citizens safe,” said Assistant Special Agent in Charge John Gliatta of the Sacramento field office of the Federal Bureau of Investigation. “We and our law enforcement partners are committed to the identification and investigation of any such activity to ensure that those who corruptly abuse public trust are held accountable for their criminal activity.”

“Former police officer Derik Kumagai participated in an elaborate bribery scheme in which he utilized his position as a law enforcement officer for personal gain. This type of behavior from a public servant is not only illegal, but also appalling,” stated DEA Acting Special Agent in Charge Bruce C. Balzano. “DEA will vigorously work to hold those accountable who abuse their position and violate the public trust.”

“The defendant’s conduct was reprehensible and a dishonor to those who took an oath to uphold the law and protect citizens,” said IRS Criminal Investigation Special Agent in Charge José M. Martinez. “Mr. Kumagai used his position for personal gain, betraying the community he swore to protect. IRS-CI will continue to investigate public corruption to ensure everyone plays by the same rules—regardless of job or position.”

This case was the product of an investigation by the Federal Bureau of Investigation, the Drug Enforcement Administration, and the Internal Revenue Service - Criminal Investigation. Assistant United States Attorneys Grant B. Rabenn and Kevin P. Rooney prosecuted the case.

This case was the product of the Organized Crime Drug Enforcement Task Force (OCDETF), a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies.

FRESNO, Calif. —Tracy McArthur Harris, aka Trey Harris, 42, a federal inmate who is serving an 11-year prison sentence for a cocaine conspiracy, pleaded guilty today to conspiring with his brother, James Steven Harris, aka Steve Harris, 44, of Loma Linda, to smuggle synthetic cannabinoids into Taft Correctional Institution, United States Attorney Benjamin B. Wagner announced.

According to court documents, from December 2012, through April 2013, while incarcerated at Taft Correctional Institution, Trey Harris conspired to obtain smokable synthetic cannabinoids from his brother during visits. Some of the drugs, which were seized by prison authorities during the conspiracy, tested positive for XLR11, then a controlled substance analogue. In May 2013, DEA classified XLR11 as a Schedule I controlled substance following reports by the Centers for Disease Control that XLR11 not only produces hallucinogenic effects but causes kidney damage.

Trey Harris is scheduled for sentencing on July 20, 2015, before Senior U.S. District Judge Anthony W. Ishii. He faces a maximum sentence of five years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

Steve Harris is scheduled for a status conference on May 11, 2015, in federal court in Fresno. The charges against him are only allegations, and he is considered innocent unless and until proven guilty beyond a reasonable doubt.

This case is the product of an investigation by the Federal Bureau of Investigation and Taft Correctional Institution Investigations Department. Assistant United States Attorney Karen A. Escobar is prosecuting the case.

Law enforcement agencies have struggled to stem the tide of emerging smokable synthetic cannabinoids, substances that look like marijuana that are sprayed or mixed with a hallucinogenic chemical and often marketed and sold in smoke shops and convenience stores as “potpourri,” “incense,” or “spice.” The chemicals, typically imported from China, come in hundreds of varieties; new formulations appear constantly, with molecules subtly tweaked to try to avoid classification as a controlled substance. However, because they are chemically and pharmacologically similar to controlled substances, these chemicals are considered controlled substance analogues, which are illegal under federal law. Synthetic cannabinoid usage poses extreme health risks that have resulted in serious bodily injury or death. According to the American Association of Poison Control Centers, exposures to synthetic cannabinoids have spiked this year, with 2,252 exposures reported from January 1, 2015, through April 27, 2015.

FRESNO, Calif. — Sherise Lanelle Woolridge, 33, of Atwater, pleaded guilty today to mail fraud and aggravated identity theft for a scheme to obtain student aid grant funds and loans, United States Attorney Benjamin B. Wagner announced.

According to court documents, Woolridge participated in a scheme to defraud the United States Department of Education of student aid grants and loans. She submitted false financial aid applications to Axia College at the University of Phoenix and Capella University on behalf of students who did not intend to attend either school. She used stolen or wrongfully obtained personal identifying information for a person who did not know her identity would be used to apply for college financial aid. As a result of the scheme to defraud, more than $200,000 in grants and loans were disbursed.

This case is the product of an investigation by the U.S. Department of Education Office of Inspector General. United States Attorney Mark J. McKeon is prosecuting the case.

Woolridge is scheduled to be sentenced by United States District Judge Lawrence J. O'Neill on August 3, 2015. Woolridge faces a maximum statutory penalty of 20 years in prison and a $250,000 fine for mail fraud, and a mandatory sentence of two years in prison for aggravated identity theft. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

SACRAMENTO, Calif. —Kevin Dennis Golden, 39, of Reno, Nevada, was sentenced today to two years in prison for possession with the intent to distribute approximately 88 pounds of marijuana that he was attempting to fly in a private plane to Pennsylvania, United States Attorney Benjamin B. Wagner announced.

According to court documents, on December 14, 2012, law enforcement agents went to the Lincoln airport as part of an investigation into a suspicious Cessna airplane that had been making frequent flights from California to the Midwest and East Coast. They observed that the plane had landed and saw the pilot go into the pilot’s lounge. Approximately an hour later, a vehicle drove up to the airplane. Golden got out of the vehicle, removed three black suitcases and a backpack from the vehicle and placed them inside the airplane. Golden then drove to a nearby parking lot, parked, and walked back to the airplane. Agents approached the pilot of the plane and told him of their intent to perform a ramp check in accordance with Federal Aviation Administration regulations. While conducting the ramp check, the three suitcases were seen inside the small aircraft.  After receiving consent to look inside the suitcases from Golden, the agents discovered multiple vacuum-sealed bags of marijuana. An additional bag of marijuana was found in the smaller backpack that also contained Golden’s identification. A total of 40 kilograms (88 pounds) of marijuana were taken out of the suitcases and backpack. Further evidence showed that Golden had taken two previous trips to Philadelphia, Pennsylvania in the aircraft to deliver marijuana.

U.S. Attorney Benjamin Wagner stated: “The use of private planes and small private airports to transport and distribute controlled substances is a known and continuing problem within the Eastern District of California.  Persons involved in such activity should understand that they face prison, large fines, and, in appropriate cases, forfeiture of vehicles and aircraft used to engage in such activity.”

This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), with the assistance of the Lincoln Police Department and the Placer County Sheriff’s Office.

 

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FRESNO, Calif. — The government has moved to dismiss the federal indictment against Keith Matthew Emerald, 33, of Columbia, California, United States Attorney Benjamin B. Wagner announced. The indictment alleged that Emerald had caused the Rim Fire, which burned approximately 250,000 acres of land, and that he had made a false statement to federal investigators regarding the origin of that fire.

In its motion to dismiss, filed today, the government advised the United States District Court that two witnesses had unexpectedly died in recent months, since the filing of the indictment last August. The government’s motion characterized one witness as critical to the case and stated that he had been expected to provide trial testimony regarding his discussions with Emerald shortly after Emerald had been rescued from the vicinity of the Rim Fire’s origin. That witness died in a workplace accident in February. The second witness was the helicopter pilot who first responded to the Rim Fire. That witness had been expected to testify about the initial response to the Rim Fire and the rescue of the defendant very close to the Rim Fire’s point of origin. That witness died in March of cardiac arrest. These witnesses’ prior statements are inadmissible hearsay and cannot be used as evidence at trial.

In its motion, the government stated that it had reassessed the case in light of the loss of this anticipated trial testimony and determined that without that testimony it was unlikely to prove the charges in the case beyond a reasonable doubt to the unanimous satisfaction of a trial jury. Accordingly, it was in the interests of justice to dismiss the case.

United States Attorney Wagner stated, “I appreciate the hard work done by the US Forest Service in investigating this case, and I understand that the government’s motion to dismiss will be frustrating to some. However, when circumstances change after indictment, and our judgment is that a case is no longer likely to be proven beyond a reasonable doubt, it is our obligation to the defendant and to the Court to dismiss that case.”

The United States Attorney also noted that the indictment contained only allegations; a defendant is always presumed innocent until and unless proven guilty beyond a reasonable doubt.

 

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SACRAMENTO, Calif. — A federal grand jury returned a four-count indictment today against Gursharan Phagura, 39, and Harminder Phagura, 35, both residents of Yuba City, United States Attorney Benjamin B. Wagner announced.

According to court documents, Gursharan Phagura and Harminder are accused of conspiring to possess, with intent to distribute, cocaine, as well as accepting and facilitating bribes.  The indictment alleges that Harminder Phagura used his authority as a police officer to gather sensitive information, which Gursharan Phagura transmitted to a third party, who was posing as a cocaine trafficker.

Gursharan Phagura is charged separately with possessing, with intent to distribute, cocaine in 2011.

Harminder Phagura and Gursharan Phagura were arrested on April 15, 2015.  Harminder Phagura was released on a $100,000 bond.  Gursharan Phagura is in pretrial custody.

This case was the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).  The Federal Bureau of Investigation also provided resources to the investigation.  The Yuba City Police Department has assisted in the investigation.  Assistant United States Attorney Paul Hemesath is prosecuting the case.

If convicted, the defendants face a maximum statutory penalty of 20 years in prison and a $1,000,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

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SACRAMENTO, Calif. — A federal grand jury returned two separate indictments today charging a total of six defendants with methamphetamine trafficking offenses, United States Attorney Benjamin B. Wagner announced.

In the first case, Jose Acosta, 34, Jorge Rios, 39, Jose Luis Aguilar, 49, Diego Velazquez, 29, and Feliciano Ochoa Reyes, 30, all Mexican nationals, were charged with conspiring to traffic methamphetamine and use of a communications facility (cellular telephone) in furtherance of a drug trafficking crime. According to court documents, between September 10, 2014, and April 16, 2015, the defendants were engaged in conspiracy to traffic methamphetamine in and around the Sacramento area. Docket # 2:15-cr-092 JAM

In the second case, Alex Velasquez Rangel, of Sacramento, was charged with distribution of methamphetamine between February 12, 2014, and April 22, 2014. Docket # 2:15-cr-093 GEB

Both cases were the product of an investigation by the Drug Enforcement Administration. Assistant United States Attorney Christiaan Highsmith is prosecuting both cases.

All defendants have been detained pending trial. If convicted, each defendant faces a maximum statutory penalty of 20 years in prison and a $1 million fine on the conspiracy charge and four years in prison and a $250,000 fine on the use of a communications facility in a furtherance of a drug trafficking offense charge. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; each defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

 

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SACRAMENTO, Calif. — Earlier today in Merced in the presence of his family and many friends and former colleagues, a ceremony was held in honor of Rick Oules, former Law Enforcement Coordinator for the United States Attorney’s Office for the Eastern District of California, that included the unveiling of the Rick K. Oules Memorial Highway sign. Pursuant to a bill introduced in the state legislature earlier this year by Senator Anthony Canella (Ceres), the portion of State Highway Route 140 from Arboleda Drive to Plainsburg Road in Merced County will now be known as the Rick K. Oules Memorial Highway.

Rick began his career in law enforcement in 1977 with the Merced County Sheriff’s Office, where he served as a Patrol Deputy, a Narcotics Detective, and a Patrol Sergeant. In 1987, he joined the California Department of Justice as a Special Agent and was assigned to the Bureau of Narcotic Enforcement, where he worked on and supervised a clandestine lab enforcement team resulting in the investigation and dismantling of approximately 300 methamphetamine laboratories. In 2005, he was appointed as the Director of the California Department of Justice’s Division of Law Enforcement, one of the largest state investigative law enforcement agencies in the United States. During his career with the State of California, Rick served as President of the California Narcotic Officers’ Association (CNOA), served on the CNOA Executive Board of Directors and the Executive Board of Directors of the California Peace Officers’ Association, and was appointed to the California Council on Criminal Justice.

In January of 2008, Rick joined the United States Attorney’s Office as our Law Enforcement Coordinator. As LEC, Rick represented our office and the United States Department of Justice as the primary point of contact for the 34 county sheriffs’ offices, more than 100 police departments, and multiple other state local and tribal law enforcement agencies that serve the Eastern District of California. He served as LEC with great distinction until his untimely death in 2011, after a courageous battle with lung cancer that was determined to be a result of his frequent long-term exposure to the chemicals and solvents found in the methamphetamine laboratories he dismantled over the course of his career.

“Rick Oules was a dedicated, skilled and effective lawman, who spent years making California a safer place to live,” said United States Attorney Benjamin B. Wagner. During the all too brief time that we were fortunate to have with him, he represented the U.S. Attorney’s Office with dignity and grace, and to great effect. We miss all the great work that he did, but we miss him more as a friend. We are so pleased to see the establishment of this memorial in his name.”

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Sacramento, Calif. — Vincent J. Doyle, 56, formerly of Elk Grove, California, was sentenced on Wednesday by United States District Judge Kimberly J. Mueller to 51 months in prison for mail fraud arising out of his embezzlement from his former employer of more than $2.5 million.  Doyle was also ordered to pay over $2.5 million in restitution.

According to court documents, Doyle was the Chief Financial Officer for a civil engineering firm located in Sacramento and El Dorado counties.  From 2001 until he retired from the firm in 2009, Doyle used his position to write unauthorized checks in small varied amounts from the firm’s bank accounts that totaled over $2.5 million.  In order to conceal his fraud, Doyle often entered false payee information into the firm’s checkbook register and opened a Post Office box to receive mail associated with his fraud.  According to court documents, the defendant used a great deal of the money to pay the expenses for an exotic dancer/prostitute, including plastic surgery.

This case is the product of an investigation by the Federal Bureau of Investigation.  The case was prosecuted by Assistant United States Attorney Lee S. Bickley.          

 

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SACRAMENTO, Calif. — The former operations manager of WECO Aerospace Systems Inc. was sentenced today for conspiracy to destroy aircraft or aircraft facilities, United States Attorney Benjamin B. Wagner announced.

United States District Judge John A. Mendez sentenced Jerry Edward Kuwata, 64, of Granite Bay, to one year in prison. WECO was a Federal Aviation Administration-certified repair business with facilities in Lincoln and Burbank, California. According to court documents, WECO was permitted by the FAA to repair certain types of aircraft parts, including starter generators and converters, used on various types of aircraft, including small helicopters used by tour companies and law enforcement agencies. WECO employees regularly failed to follow FAA regulations in repairing and overhauling the aircraft parts. In many cases, WECO did not even have equipment capable of performing required tests. WECO employees at both locations nonetheless performed repairs and returned parts to customers, falsely certifying that the parts had passed tests and had been repaired in accordance FAA standards. There have been no known instances in which a fraudulent WECO repair resulted in an aircraft accident. However, WECO customers who testified at the trial of WECO’s owner, William Hugh Weygandt, 65, of Granite Bay, consistently testified that once they learned of the fraudulent repairs, they removed all WECO-repaired parts from their aircraft due to safety concerns.

At sentencing, Judge Mendez noted that Kuwata never took action to notify the FAA of the fraud, and expressed concern for the potential safety risks posed by such conduct.

A federal jury found Weygandt guilty at trial of conspiracy to commit fraud involving aircraft parts repair. He was sentenced on July 8, 2014, to two and a half years in prison. Other former WECO executives Michael Dennis Maupin, of Arbuckle; and Anthony Vincent Zito, of Saugus, previously pleaded guilty to federal offenses in connection with the conspiracy and await sentencing.

This case is the product of an investigation by the Inspector General for the Department of Transportation and the Federal Bureau of Investigation, along with the Inspectors General of the Department of Homeland Security, and Department of Defense. Assistant U.S. Attorney Michele Beckwith is prosecuting the case.

 

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SACRAMENTO, Calif. —Keith Joseph Banning, 59, of Magalia, pleaded guilty today to receipt of child pornography, United States Attorney Benjamin B. Wagner announced.

According to court documents, an undercover investigation revealed that in June through August of 2012, an Internet user at Banning’s home address was using a peer-to-peer file-sharing network to share pictures and videos depicting the sexual exploitation of children, including a number of videos involving children under the age of 10. A search warrant executed at Banning’s home revealed that his computers contained hundreds of videos depicting the sexual abuse of children, and that at various times many of those videos were made available to others over the Internet through a file-sharing network.

This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant United States Attorney Matthew G. Morris is prosecuting the case.

Banning is scheduled to be sentenced on August 4, 2015, by United States District Judge John A. Mendez. Banning faces a possible sentence of five to 20 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. Click on the “resources” tab for information about Internet safety.

 

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FRESNO, Calif. —Jose Mojarro Cruz, aka Shyboy, 28, of Bakersfield, pleaded guilty on Monday to conspiring to distribute and possess with intent to distribute methamphetamine and heroin, United States Attorney Benjamin B. Wagner announced.

According to court documents, from May 2013 through January 2014, Cruz regularly distributed methamphetamine and heroin to various drug dealers and users in Kern County.  In particular, Cruz admitted to distributing a combined total of more than 15 kilograms of methamphetamine. 

This case is the product of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Drug Enforcement Administration, Kern County Sheriff’s Office, and the Southern Tri-County High Intensity Drug Trafficking Area Task Force. Assistant United States Attorney Brian K. Delaney is prosecuting the case.

Cruz is scheduled to be sentenced by Judge Lawrence J. O'Neill on July 20, 2015. Cruz faces a maximum statutory penalty of life in prison and a $10 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

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FRESNO, Calif. — James Giulio Davidson, 59, of Modesto, was sentenced today by United States District Judge Anthony W. Ishii to 18 months in federal prison and ordered to pay a $127,000 in restitution for theft of government benefits, United States Attorney Benjamin B. Wagner announced.

According to court documents, Davidson and his deceased wife and former co-defendant, Shirley Kay Davidson, stole more than $64,000 in Supplemental Security Income (SSI) benefits and $63,000 in In-Home Supportive Services (IHSS) from January 2003 to July 2010. Shirley Kay Davidson created a fake person named Sharon Guinn to act as her and James Davidson’s purported IHSS caretaker. James and Shirley Davidson regularly filled out false time cards for the purported work provided by Sharon Guinn and then cashed the IHSS wages sent to this fake person for their personal use and benefit. Further, James and Shirley Davidson failed to report this fraudulent source of income to the Social Security Administration during redetermination interviews for continued SSI benefits. Additionally, James and Shirley Davidson stated to the SSA that they separated in November 2007, when in fact they continued to live together, which increased the amount of SSI benefits they received.

This case was the product of an investigation by the Social Security Administration, Office of Inspector General and the Stanislaus County Community Services Agency. Assistant United States Attorneys Grant B. Rabenn and Michael Tierney prosecuted the case.

Docket #: 1:12-cr-168-AWI

FRESNO, Calif. — David Arreola, 29, of Michoacán, Mexico, was sentenced today to seven and a half years in prison for conspiring to manufacture, distribute and possess with intent to distribute marijuana grown on public land and possessing a firearm in furtherance of the conspiracy, U.S. Attorney Benjamin B. Wagner announced.

According to court documents, Arreola and his co-defendants, Hernan Cortez-Villaseñor, 40; Homero Pacheco-Rivera, 22; Alfonso Cornejo, 32; and Jose Luis García-Villa, 22, all of Michoacán, Mexico, conspired in the cultivation of approximately 8,876 marijuana plants in the Greenhorn Creek area of the Sequoia National Forest in Kern County. Arreola also admitted that he possessed a 9 millimeter semi-automatic handgun in furtherance of the conspiracy and was in possession of the weapon at the time of his apprehension at the grow site by law enforcement officers.

In sentencing Arreola, Senior U.S. District Judge Anthony W. Ishii also ordered Arreola to make restitution to the U.S. Forest Service of $3,300 for damage to the land and natural resources caused by the marijuana operation. According to court documents, the Greenhorn Creek site sustained extensive damage as a result of the operation. Native oak trees and other vegetation were cut down or otherwise killed to make room for the marijuana plants. The soil was tilled, and fertilizers and pesticides, including Fosfuro de Zinc, an illegal rat poison, were spread throughout the site. As noted in his plea agreement, Fosfuro de Zinc contains zinc phosphide, a highly toxic chemical that can sicken or kill human beings. When Arreola was apprehended, he was sick and had to be air-lifted out of the grow site. According to Arreola, several other growers had previously left the site, because they were sick.

Three of Arreola’s co-defendants previously entered guilty pleas and were sentenced. Cortez-Villaseñor was sentenced to 10 years in prison, and Cornejo and García-Villa were both sentenced to 3 years and 10 months in prison. Pacheco-Rivera is a fugitive. Upon completion of his prison sentence, Arreola, like his co-defendants, faces potential removal to Mexico.

This case is the product of an investigation by the U.S. Forest Service, the U.S. Drug Enforcement Administration, the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the U.S. Environmental Protection Agency Criminal Investigation Division (EPA-CID), and the Kern County Sheriff’s Office. Assistant United States Attorney Karen Escobar prosecuted the case.

Docket #: 1:12-cr-184 AWI

SACRAMENTO, Calif. — Robert Anthony Guerena, 21, of Stockton, was sentenced today by United States District Judge Morrison C. England Jr. to 11 years and three months in prison for conspiring to distribute and to possess with intent to distribute methamphetamine, and possession with intent to distribute methamphetamine, United States Attorney Benjamin B. Wagner announced.

According to court documents, between August and September 2013, Guerena and co-defendant Robert Vargas met with an undercover agent on four separate occasions to conduct methamphetamine transactions. Each of these meetings occurred in a Walmart parking lot in Stockton, and with each subsequent meeting, the amount of methamphetamine provided by the defendants to the undercover officer agent increased. Over the course of the transactions, Guerena boasted that he had access to pound quantities of methamphetamine. On September 19, 2013, the defendants arrived at the Walmart parking lot intending to provide the undercover agent with two pounds of methamphetamine. Before the transaction was completed, both defendants were arrested. In all, the defendants provided the undercover agent with approximately 1.2 kilograms of pure methamphetamine.

Vargas is scheduled to be sentenced on May 14, 2015.

This case is the product of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Stockton Police Department, and the San Joaquin Sheriff’s Office. Assistant United States Attorney Olusere Olowoyeye is prosecuting the case.

Docket #: 2:13-cr-326 MCE

SACRAMENTO, Calif. — Glen Edward Meyers, 57, of Shasta Lake, was sentenced on Wednesday by United States District Judge Kimberly J. Mueller to eight years in prison for conspiring to distribute marijuana and conspiracy to launder money, United States Attorney Benjamin B. Wagner announced.

According to court documents, Meyers conspired with others to manufacture and distribute marijuana that had been grown in California and shipped to Pennsylvania for sale. When Meyers was arrested in Shasta Lake in September 2013, federal agents discovered numerous guns at his house, approximately 20 pounds of processed marijuana packaged for resale, as well as cash, heat sealers, and other indicia of drug trafficking. At the time, there were three minor children living in the home. As part of the investigation, agents also discovered a warehouse at another location, which contained approximately 490 plants in various stages of growth.

The government ultimately seized and forfeited approximately $1 million in drug proceeds from various bank accounts and other assets that Meyers controlled.

This case was the product of an investigation by the Internal Revenue Service – Criminal Investigation, and the Sacramento Valley Financial Crimes Task Force, with assistance from the Pennsylvania State Police, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Drug Enforcement Administration, and the Pennsylvania, Washington County Drug Task Force. Assistant United States Attorney Michele Beckwith, Michael D. McCoy, and Kevin Khasigian prosecuted the case.

SACRAMENTO, Calif. — Edwin Ludwig IV, 34, currently an inmate in an Oklahoma state prison, pleaded guilty on Wednesday to one count of conspiracy to defraud the United States and two counts of filing false claims for federal tax refunds, United States Attorney Benjamin Wagner announced.

According to court documents, beginning in March 2011, Ludwig and three fellow inmates in the California Correctional Center in Susanville obtained personal identification information of other inmates at the correctional center. Ludwig then provided the information to co-defendants on the outside who prepared and filed false income tax returns with the Internal Revenue Service, claiming refunds to which the inmates were not entitled. False tax returns also were filed in some of the defendants’ own names. The defendants caused the false refund checks to be deposited to various bank accounts they controlled. According to the indictment, the investigation into the conspiracy began on January 11, 2012, when a correctional officer found some records behind Ludwig’s personal locker.

According to court documents, the refunds were used for personal expenditures, and included the purchase of prepaid debit cards, and adding money to inmates’ commissary accounts. In all, the conspiracy resulted in at least 247 false claims for income tax returns in tax years 2008 through 2011. Although the IRS stopped some of the refunds, approximately 138 fraudulent refunds totaling approximately $219,984 were issued.

This case is the product of an investigation by the Internal Revenue Service, Criminal Investigation, the Federal Bureau of Investigation, and the Investigative Service Unit at the California Correctional Center. Assistant United States Attorney Sherry D. Hartel Haus is prosecuting the case.

Ludwig is scheduled to be sentenced by Judge Kimberly J. Mueller on July 8, 2015. On the conspiracy count, he faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. He faces additional a maximum sentence of five years in prison and a $250,000 fine on each false claims count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

Docket #: 2:14-cr-043 KJM

SACRAMENTO, Calif. — A federal grand jury returned a 21-count indictment today against Abolghasseni “Abe” Alizadeh, 56, of Granite Bay, and Mary Sue Weaver, 62, of Roseville, charging them with various counts of mail, wire and bank fraud in connection with schemes to defraud lenders in large commercial real estate transactions between mid-2004 and April 2008, United States Attorney Benjamin B. Wagner announced.

According to court documents, Alizadeh, a property developer, was formerly the principal partner in Kobra Properties, a company that owned numerous commercial real estate properties in Northern California. Alizadeh also owned dozens of Jack in the Box, TGI Fridays, Sonic Burger, Qudoba Mexican Grills and other restaurants in the region. Although his assets at one point had an estimated value of $1 billion, Kobra and several other entities controlled by Alizadeh filed for bankruptcy in 2008. Weaver was an escrow officer with Placer Title Company. The indictment alleges that she and Alizadeh engaged in a scheme to get loans at inflated amounts on commercial and residential real estate. To carry out the scheme, Alizadeh allegedly would submit false information, including altered purchase contracts for million-dollar property purchases, to federally insured banks in order to make it appear that Alizadeh was purchasing the properties for a greater amount than the actual purchase price. According to court documents, Weaver assisted the fraud scheme in various ways including by taking the money belonging to other Placer County clients and temporarily moving the funds into accounts controlled by Alizadeh.

“Over the last five years, we have prosecuted over 300 mortgage fraud defendants,” said U.S. Attorney Wagner. “Although we are seven years removed from the financial crisis, the statute of limitations has not run on many offenses from that period. We will continue to investigate and to hold accountable those whose conduct defrauded others and helped precipitate a financial crisis that did so much harm to homeowners, investors and the financial system.”

Wade V. Walters, Special Agent-in-Charge for of the FDIC Office of Inspector General’s Office of Investigations stated: “The Federal Deposit Insurance Corporation (FDIC) Office of Inspector General is pleased to join the U.S. Attorney’s Office and our law enforcement colleagues in bringing about this indictment. Our office is particularly concerned about conduct that could affect the safety and soundness of FDIC-insured institutions. We are committed in our efforts to help ensure integrity in the financial services industry.”

This case is the product of an investigation by the Federal Bureau of Investigation, the Internal Revenue Service—Criminal Investigation, and the Federal Deposit Insurance Corporation Office of Inspector General. Assistant United States Attorneys Michael D. Anderson and Heiko P. Coppola are prosecuting the case.

If convicted, Alizadeh and Weaver face a maximum statutory penalty of 30 years in prison and a $1 million fine for each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are each presumed innocent until and unless proven guilty beyond a reasonable doubt.

Docket #: 2:15-cr-087-KJM

FRESNO, Calif. —Emilio Perez-Solis, 39, of Oakland, was sentenced today to three years and 10 months in prison, for conspiring to sell counterfeit CDs and DVDs, United States Attorney Benjamin B. Wagner announced.

According to court documents, Perez-Solis used a building in a rural area of Fresno as a distribution point for counterfeit CDs and counterfeit DVDs. From the building, Perez-Solis sold counterfeit CDs and DVDs, including movies that were only in theatrical release and not yet available on DVD. On Feb. 21, 2014, the building was searched and found to contain approximately 70,000 counterfeit music CDs and movie DVDs.

This case was the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) with assistance from the Fresno County Sheriff’s Office. Assistant United States Attorneys Henry Z. Carbajal III and Patrick R. Delahunty prosecuted the case.

Docket #: 1:14-cr-042 LJO

FRESNO, Calif. — Christine Rose Caraway, 34, of Modesto, was sentenced by Senior United States District Judge Anthony W. Ishii to two and a half years in prison for conspiring to submit false claims to the IRS, United States Attorney Benjamin B. Wagner announced. Caraway was also ordered to pay over $60,000 in restitution to the IRS.

According to court documents, from December 2010 to May 2011, Caraway and her former spouse Heath Lee Roberson obtained personal identifying information from over 40 individuals. Caraway and Roberson then used this information to generate false tax returns and submitted them to the IRS. They funneled the tax refunds into accounts they controlled. Roberson was sentenced on July 21, 2014, to two years and nine months in prison.

This case was the product of an investigation by the Internal Revenue Service - Criminal Investigation. Assistant United States Attorney Michael G. Tierney prosecuted the case.

Docket #: 1:13-cr-342 AWI

FRESNO, Calif. —Toribio Cruz-Galvan (Cruz), 29, of Michoacán, Mexico, pleaded guilty today to conspiring to manufacture, distribute, and possess marijuana with intent to distribute, United States Attorney Benjamin B. Wagner announced.

According to court documents, Cruz was involved in the cultivation of 1,016 marijuana plants and processing of 51 pounds of dried marijuana in the Yucca Mountain area of the Sequoia National Park. The Yucca Mountain area is in an area generally known for its spring wildflower display. In addition to the growing marijuana plants, park rangers found processed marijuana, a shotgun, and ammunition for various firearms. The marijuana cultivation operation also caused significant damage to National Park land and natural resources. Fertilizer, rodenticide, propane tanks, and 300 pounds of trash were removed from the grow site. It is estimated that over one million gallons of water was diverted from a nearby spring to irrigate the marijuana plants.

Cruz remains detained as a flight risk and danger to the community and is scheduled for sentencing before U.S. District Judge Lawrence J. O’Neill on July 20, 2015. He faces a maximum statutory penalty of 20 years in prison and a $1 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case was the product of an investigation by the National Park Service. Assistant United States Attorney Karen A. Escobar is prosecuting the case.

Docket #: 1:14-cr-225-LJO

FRESNO, Calif. —Mark Jeff Zeldes, 53, of Broomfield, Colorado, was sentenced today to three years and eight months in prison for a conspiracy in California to manufacture, distribute and possess with intent to distribute marijuana, United States Attorney Benjamin B. Wagner announced. Zeldes was also ordered to forfeit over 300 pieces of equipment used for the indoor cultivation of marijuana.

This sentence follows Zeldes’ guilty plea earlier this year. In sentencing Zeldes, Senior U.S. District Judge Anthony W. Ishii considered court documents which indicate that Zeldes was responsible for a large-scale marijuana cultivation and distribution operation with multiple indoor grow locations in Bakersfield, Newbury Park, and Northridge, California. Law enforcement officers seized 1,856 marijuana plants in connection with those operations.

Court records also indicate that, at the time of his arrest in Colorado, Zeldes had several locked and loaded firearms in his residence, as well as several rounds of ammunition, including an automatic weapon magazine capable of holding 100 rounds of ammunition. Following his arrest, Zeldes was brought before a U.S. Magistrate Judge in Denver, who ordered him detained as a flight risk and danger to the community. In ordering his detention, the court cited to Zeldes’ ongoing involvement in marijuana cultivation and distribution activities, including a $9 million contract with private investors to operate a marijuana grow.

This case was the product of an investigation by the U.S. Drug Enforcement Administration with assistance from the U.S. Marshals Service and Bakersfield Police Department. Assistant United States Attorney Karen Escobar prosecuted the case.

Docket #: 1:14-cr-077 AWI

SACRAMENTO, Calif. — United States District Judge William B. Shubb issued a detailed, 63-page order today denying Sierra Pacific Industries’ motion to set aside the settlement of the Moonlight Fire case and emphatically rejecting each and every allegation by Sierra Pacific’s counsel that there was fraud on the court.

After an exhaustive review of the law and the record of this case, Judge Shubb concluded that the defendants “have failed to identify even a single instance of fraud on the court, certainly none on the part of any attorney for the government. They repeatedly argue that fraud on the court can be found by considering the totality of the allegations. Here, the whole can be no greater than the sum of its parts. Stripped of all its bluster, defendants’ motion is wholly devoid of any substance.” [Order at page 63.]

“I have repeatedly stated that a full examination of the actual record in this case would demonstrate that the misconduct claims made by the attorneys for Sierra Pacific were bogus, and I am very gratified by the Court’s thorough and thoughtful ruling,” said United States Attorney Benjamin B. Wagner. “Sierra Pacific’s reckless accusations have been broadcast in open court and in numerous media stories throughout the country. It is not an inconsequential thing to besmirch the integrity of dedicated public servants. Assistant United States Attorneys David Shelledy and Kelli Taylor provided skilled representation to the United States in holding the Sierra Pacific defendants responsible for the incredible damage they caused, and they provided that representation in accordance with the high ethical standards regularly demanded of Department of Justice employees. I am thankful for their service, and proud to be their colleague.”

The Moonlight Fire ignited on September 3, 2007, on private forest land in Plumas County, California, and raged for more than two weeks, consuming about 65,000 acres of land, including more than 46,000 acres of federal public lands. A jury trial in the case before U.S. District Judge Kimberly J. Mueller had been scheduled to begin on July 9, 2012 in Sacramento, but the parties entered into a settlement shortly before trial. At an estimated value of at least $122,500,000, the settlement was the largest recovery ever received by the United States for damages caused by a forest fire. In October 2014, Sierra Pacific filed a motion to set aside the judgment for damages resulting from the Moonlight Fire, claiming there had been a fraud on the court.

In rejecting each and every claim by Sierra Pacific’s attorneys, Judge Shubb noted that they were aware of almost all of the facts, which they now claim show fraud-on-the-court before they decided to settle the case. As the Court put it, “defendants made the calculated decision on the eve of trial to settle the case knowing everything that they now claim amounts to fraud on the court.” [Order at page 27.] Moreover, regardless of when the facts became known, the Court found that each of Sierra Pacific’s claims was without merit.

As to arguments that an Assistant U.S. Attorney facilitated perjury by an investigator in a deposition when he testified about what the defendants characterized as a “white flag” near the origin location, the Judge ruled that “[w]hen the record is examined there is no substance whatsoever to defendants’ contention.” [Order at page 34.] As to defendants’ suggestion that the removal of former Assistant U.S. Attorney Robert Wright from the Moonlight Fire case in early 2010 “tends to show” some sort of fraudulent intent by the government, Judge Shubb wrote, “[i]t neither shows nor suggests any such thing.” [Order at page 61.] As to claims relating to a state fund administered by CalFire, Judge Shubb observed that the defendants do not even allege the federal government had the documents at issue, and the state audit report revealing details of the fund did not even exist prior to the settlement of the Moonlight Fire case.

Judge Shubb noted that the defendants “have been represented by numerous high‑priced attorneys throughout this litigation,” and he chided some of those attorneys several times in the order for reckless or disingenuous arguments. He noted in a footnote that the attorneys “may be playing loose with their characterizations of the deposition testimony” that they cited. [Order at page 37, fn 10.] The court described another defense claim as “misleading” [Order at page 48], and stated that he was concerned “that defendants would so flippantly” make one representation to the court in arguing this motion, when it argued precisely the opposite to the court during the pre-settlement litigation of this case. [Order at pages 58-59.]

In its brief filed in February, the Government outlined instances in which the defendants’ attorneys manipulated the excerpts of record to support defense claims of witness perjury by excising portions of deposition transcripts that contradicted these claims.

Docket #: 2:09-cv-2445

SACRAMENTO, Calif. — A federal grand jury returned an 11-count indictment today against Donnie Phillips, 56, of Concord; Gordon Miller, 57, of Clayton; and Phyliss Mosher, 51, of Vallejo, charging them with conspiracy to distribute methamphetamine and related methamphetamine trafficking charges, United States Attorney Benjamin B. Wagner announced.

According to court documents, between June 2014 and February 2015, Mosher sold large amounts of methamphetamine to an undercover agent. Phillips and Miller supplied the methamphetamine to Mosher. Transactions took place in the counties of Solano, Contra Costa, Yolo, Shasta, and San Joaquin.

This case is the product of an investigation by the Drug Enforcement Administration, the Vallejo Police Department, and the El Dorado County Sheriff’s Office as part of an Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF Program was established in 1982 to conduct comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply.

If convicted, each defendant faces a maximum statutory penalty of life in prison and a $10 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — A federal grand jury returned a six-count indictment today against Mark F. Friend, 60, of Stockton, charging him with six counts of bank fraud relating to a mortgage fraud scheme, United States Attorney Benjamin B. Wagner announced.

According to the indictment, in 2005 and 2006 while working for National City Mortgage, then a division of National City Bank, in Stockton, Friend arranged loans for borrowers that contained numerous falsehoods. He submitted false loan applications and other documents, and he made down payments on behalf of borrowers who did not have enough money, and then was repaid out of escrow after the loans were funded. The loss to National City Bank was approximately $1.5 million.

This case is the product of an investigation by the Federal Bureau of Investigation. Assistant United States Attorneys John K. Vincent and Christiaan H. Highsmith are prosecuting the case.

If convicted, Friend faces a maximum statutory penalty of 30 years in prison and a $1 million fine for each count of bank fraud. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — A federal grand jury returned a single-count indictment today against Jonathan Arturo Alvarez, 25, of Bakersfield, charging him with possession with intent to distribute cocaine, United States Attorney Benjamin B. Wagner announced.

According to court documents, on April 2, 2015, a California Highway Patrol officer conducted a traffic stop of the vehicle driven by Alvarez in Siskiyou County. A subsequent search of the vehicle led to the recovery of 12 kilograms of cocaine.

This case was the product of an investigation by the California Highway Patrol and the Drug Enforcement Administration. Assistant United States Attorney Olusere Olowoyeye is prosecuting the case.

If convicted, Alvarez faces a maximum statutory penalty of life in prison and a $10 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

SACRAMENTO, Calif. — Michael Rea, 26, of Winters, was sentenced today by United States District Judge John A. Mendez to 13 years and one month in prison for receiving child pornography, United States Attorney Benjamin B. Wagner announced.

According to court documents, Rea is a registered sex offender with a history of repeatedly failing to update his registration information. In September 2013, Rea was on probation for a prior conviction for failing to register as required by California’s sex offender registration laws. Agents of the Sacramento Sexual Assault Felony Enforcement (SAFE) Taskforce and the Federal Bureau of Investigation found Rea living with a child at a location where he was not registered to live. A search of his belongings found a DVD containing six movies of children being sexually abused. Rea has been in custody since his arrest.

The SAFE Team is a multi-jurisdictional task force created with grant funding from the California State Office of Emergency Services. The SAFE Task Force is composed of members from the Sacramento County Sheriff’s Office, the Sacramento Police Department, the Sacramento County Probation Department, and the U.S. Marshals Service, and receives support from the California Department of Corrections and Rehabilitation. Assistant United States Attorney Matthew G. Morris prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc. Click on the “resources” tab for information about Internet safety.

Docket #: 2:13-cr-397 JAM

SACRAMENTO, Calif. — With the annual tax filing deadline approaching tomorrow on April 15, United States Attorney Benjamin B. Wagner noted that his office had taken a number of criminal enforcement actions in recent months in the Eastern District of California. The U.S. Attorney’s Office works with the Internal Revenue Service – Criminal Investigation and other law enforcement partners to enforce federal tax laws.

“This is an appropriate time of year to remind those few individuals who set out to cheat or evade their tax obligations that such conduct can result in prosecution,” said U.S. Attorney Wagner. “Every year some deliberately fail to file required returns or file false and fraudulent returns in order to evade the assessment and payment of tax due. It is the obligation of this office to pursue and prosecute them for their criminal conduct.”

“All Americans have a duty and responsibility to pay taxes. In today’s economic environment, it’s more important than ever that the American people feel confident that everyone is playing by the rules and paying the taxes they owe,” said José M. Martinez, IRS ‑ Criminal Investigation Special Agent in Charge of the Oakland Field Office. “Those Americans who file accurate, honest and timely returns can be assured that the government will hold accountable those who don’t. The IRS Criminal Investigation Division, together with the Department of Justice, will investigate and prosecute those who violate our tax system.”

Eastern District of California indictments so far in 2015 have included: (The charges in an indictment are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.)

United States v. Clint D. Bonderer et al. — According to the indictment, Bonderer, 38, of Stockton, and Slavic Khudoy, 35, of Loomis conspired to submit false claims that included false statements about the taxpayers’ income, filing status, and address, and fraudulently claimed credits. Between 2010 and 2012, they submitted 842 fraudulent tax returns, requesting more than $600,000 in refunds in the names of other people. In most cases, they kept the refunds for themselves. (2:15-cr-28)

United States v. Lejohn Windom Sr. et al. — According to the indictment, Sacramento residents Windom Sr., 52; Lejohn Windon Jr., 22; Tracy Hartway, 30; and Audrey Johnson, 48, filed 682 income tax returns, requesting nearly $2 million in fraudulent refunds. They used stolen IDs requesting tax refunds and forged the names of the taxpayers to make the fraudulent refund checks payable to themselves. (2:15-cr-29)

United States v. Emilio Lara — According to the indictment, Lara, 48, of American Canyon, owned and operated two income tax preparation services in Solano County. He was charged in a 38‑count indictment with preparing fraudulent income tax returns for clients. From 2009 to 2012, Lara helped clients claim false itemized deductions such as medical and dental expenses, charitable contributions, and unreimbursed employee expenses ranging from $740 to $19,093, for a total of $462,392. (2:15-cr-39)

United States v. Linda J. Miller — According to the indictment, Miller, 62, of Benicia, was charged with filing a false tax return. (2:15-cr-66)

United States v. Vivian Williams et al. — According to the indictment, Williams, 49, a tax preparer who operated out of her home in Stockton, was charged with 44 counts of conspiracy, false claims to a government agency, identity theft, and aiding and assisting in the preparation of false and fraudulent tax returns. Darrell Lemont Morris, 43, of Stockton, was charged with one count of conspiracy. Between January 2010 and March 2011, Williams submitted tax returns for clients reporting false income allowing the taxpayers to claim a higher tax refund as a result of the Earned Income Tax Credit and the Child Tax Credit. She filed tax returns for other taxpayers without their knowledge and collected their tax refunds. Morris allowed Williams to use his bank accounts for the deposit of tax refunds, and then shared in the proceeds with Williams. (1:15-cr-28)

United States v. Yolanda Castro — According to the indictment, Castro, 45, a 20-year employee of the IRS in Fresno, was charged with 10 counts of tax fraud and making false statements to a government agency. Between 2007 and 2013, she prepared and filed false federal income tax returns for herself, her family members and others in which she fraudulently claimed tax deductions and credits. On her own 2008 tax return, Castro claimed a credit for education expenses that she did not incur and provided phony textbook receipts to support the claim. Likewise, in tax returns she prepared for herself and others, Castro claimed child care expenses that had not been incurred. (1:15-cr-50)

United States v. Elaina S. Norris — According to the indictment, seasonal tax examiner Norris, 34, of Fresno, was charged with assisting a relative in filing a tax return that falsely claimed two individuals as dependents using the personal information she obtained through her employment at the IRS Service Center. She is also charged with falsely claiming a dependent on two of her personal tax returns, resulting in the receipt of tax credits and deductions that she was not authorized to receive. (1:15-cr-072)

United States v. Brandon Adam Eidson — According to the indictment, Eidson, 34, of Turlock, operated a hydroponics equipment and supply business and is charged with three counts of filing false tax forms, one count of drug distribution, and one count of structuring cash transactions. Between 2008 and 2010, he underreported his gross receipts by over $1.2 million. (1:15-cr-85)

Other actions so far this year:

On January 20, 2015, Rebekah Root, 34, of Visalia, was sentenced to three years and nine months in prison for wire fraud, making a false claim for a tax refund, and aggravated identity theft. According to court documents, in 2011, Root obtained tax documents that were stolen from an IRS office in Visalia. She used those tax documents to submit false tax returns on behalf of six taxpayers, without their knowledge or permission, and claimed approximately $50,000 in fraudulent tax refunds. (1:13-cr-376)

On January 20, 2015, Federico Garcia Garcia, 46, of Arvin, was sentenced to two years in prison for filing false claims with the IRS in a scheme to obtain tax refunds. He was also ordered pay $79,932 in restitution to the IRS. According to his plea agreement, between October 2007 and December 2008, Garcia caused 147 false federal income tax returns to be submitted to the IRS in the names of third parties with fabricated W-2s that contained false wage and withholding information. Garcia made fraudulent claims for approximately $308,317 in federal tax refunds in the scheme, and the IRS paid out approximately $79,932. (1:13-cr-233)

On February 9, 2015, Christine Rose Caraway, 34, of Modesto, pleaded guilty to one count of conspiracy to defraud the United States. According to court documents, from about December 2010 to May 2011, Caraway and her former spouse Heath Roberson obtained personal identifying information from over 40 individuals. Caraway used this information to generate false tax returns seeking over $121,000 in tax refunds and submitted them to the IRS. Roberson pleaded guilty in April 2014 and was sentenced to two years and nine months in prison and to pay over $66,000 in restitution to the IRS. Sentencing for Caraway is set for April 20, 2015. (1:13-cr-171)

On March 13, 2015, a jury convicted Terrylyn McCain, 67, of Stockton, of a scheme to defraud the United States by filing false tax returns and buying gold with the proceeds of the fraud. According to evidence presented at trial, McCain filed at least 12 fraudulent returns that sought nearly $3 million in tax refunds. In one instance, early in the scheme, the IRS refunded $156,373 to McCain. Within the month, she had used the refund money to purchase approximately $62,000 in gold coins. Sentencing for McCain is set for June 4, 2015. (2:12-cr-144)

More criminal tax investigations are underway.

FRESNO, Calif. — Lucia Chavez, 37, and her husband Joseph Chavez, 41, both of Bakersfield, pleaded guilty today to conspiracy to commit bank fraud, mail fraud, and wire fraud, in connection with a mortgage fraud scheme in Bakersfield, U.S. Attorney Benjamin B. Wagner announced. As part of their plea agreements, Lucia Chavez agreed to a personal forfeiture money judgment of $1,624,450, and Joseph Chavez agreed to a personal forfeiture money judgment of $3,092,000.

According to court documents, Lucia Chavez and Joseph Chavez conspired with seven co-defendants from 2007 to 2010 to use straw buyers to purchase residential properties in Bakersfield developed by Pershing Partners LLC, owned by Lucia Chavez, and Jara Brothers Investments (JBI), owned by her brothers, co-defendants Eliseo Jara and Sergio Jara. The conspirators paid straw buyers to purchase the properties from JBI and Pershing Partners, and funded the purchases using loans they obtained for the straw buyers from lenders based on false and fraudulent loan applications. The loan applications the conspirators submitted to lenders frequently contained false statements concerning the straw buyers’ employment status, income, assets, intent to occupy the properties as their personal residences, and source of down payments for the purchase of the properties. The conspirators concealed from the lenders that they funded certain of the straw buyers’ down payments. The conspirators also submitted false supporting documentation to lenders such as false and altered bank account statements purporting to show that the straw buyers had high bank account balances, false verifications of the straw buyers’ bank account funds, false verifications of rent purporting to be from straw buyers’ landlords, false pay stubs, and false verifications of employment.

This case is the product of an investigation by the Internal Revenue Service - Criminal Investigation and the Federal Bureau of Investigation. Assistant U.S. Attorneys Kirk E. Sherriff, Henry Z. Carbajal III, and Megan A.S. Richards are prosecuting the case.

The court set a sentencing hearing for the Chavez defendants on July 20, 2015. The maximum sentence for the conspiracy charge is 30 years in prison and a $1 million fine. The actual sentence will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.

The other seven co-defendants all previously pleaded guilty in this case. Co-defendant Antonio Perez-Marcial was sentenced on May 12, 2014 to 3 years and 10 months in prison for his role in the conspiracy. Co-defendants Eliseo Jara, Sergio Jara, Arlene Mojardin, and Candace Gonzales each pleaded guilty to conspiracy to commit bank fraud, mail fraud, and wire fraud, and are scheduled to be sentenced on the following dates: May 18, 2015 (Arlene Mojardin), June 8, 2015 (Candace Gonzales), and June 22, 2015 (Eliseo Jara and Sergio Jara). Co-defendant Melissa Jara pleaded guilty to wire fraud and is to be sentenced on June 22, 2015. Co-defendant Ricardo Salinas previously pleaded guilty to bank fraud, and his sentencing is set for June 29, 2015.

Docket #: 1:12-cr-213 AWI

FRESNO, Calif. — Evelyn Brigget Sanchez, 32, and Darling Arlette Montalvo, 34, both of Bakersfield, were sentenced today to two years in prison each for their involvement in a mortgage fraud scheme that ran from October 2005 to May 2007, United States Attorney Benjamin B. Wagner announced. Sanchez and Montalvo were convicted at trial of conspiracy to commit mail fraud, wire fraud, and bank fraud. Sanchez was also convicted of 11 counts of mail fraud, and Montalvo was also convicted of 10 counts of mail fraud and one count of money laundering.

According to court documents, between October 2005 and May 2007, Sanchez and Montalvo conspired with co-defendants Eric Hernandez, Monica Hernandez, and Patricia King to defraud mortgage lenders by submitting false loan applications and fraudulent supporting documentation, causing the lenders to fund mortgage loans for the defendants’ benefit on the basis of false and misleading information. During this time, Eric Hernandez and Evelyn Sanchez were employed at mortgage brokerages in Bakersfield. The defendants submitted loan applications to lenders that included material misstatements concerning the borrowers’ income, assets, and employment, and false statements concerning the borrowers’ intent to reside in the properties as owner-occupiers, among other false statements. The defendants also fabricated false supporting documentation and submitted it to lenders in support of the loan applications.

The court also ordered the defendants to pay forfeiture money judgments to the United States in the amounts of $1,412,100 for Sanchez and $1,017,100 for Montalvo. The court set a further hearing on June 22, 2015 to determine the restitution amounts owed to victims of the crime.

Eric Hernandez, Monica Hernandez, and Patricia King previously pleaded guilty and were sentenced for their roles in the scheme. Eric Hernandez was sentenced on Sept. 16, 2013, to 10 years and 10 months in prison. King was sentenced on April 23, 2012, to three years and one month in prison. Monica Hernandez was sentenced on January 5, 2015, to one year in prison.

This case is the product of an investigation by the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. Assistant U.S. Attorneys Kirk Sherriff and Henry Carbajal III prosecuted the case.

Docket #: 1:10-cr-249 AWI

FRESNO, Calif. — Kenneth Manuel Martin, 66, formerly of Modesto, pleaded guilty today to one count of wire fraud in connection with a Guatemalan real estate investment scheme, United States Attorney Benjamin B. Wagner announced.

Between a date unknown and August 2008, Martin induced individuals to give him money by saying that he would cause the money to be used to fund mortgage loans to borrowers in Guatemala so borrowers could purchase homes in that country. Among several false representations, Martin represented that his company would provide a real estate attorney in Guatemala who would be able to protect investor funds and would hold a grant deed in favor of the investors secured by Guatemalan real estate. He also represented that his company would provide investors who invested in his Guatemalan real estate venture a high interest rate of return and consistent monthly interest payments. Martin provided investors with conflicting explanations concerning the lack of consistent interest payments and his failure to return the investment principal of investors who requested such a return. As a result of Martin’s conduct, investors lost approximately $258,000.

This case is the product of an investigation by the Federal Bureau of Investigation and the Social Security Administration, Office of Inspector General. Assistant United States Attorneys Henry Z. Carbajal III and Grant B. Rabenn are prosecuting the case.

Martin is scheduled to appear before Senior U.S. District Judge Anthony W. Ishii on July 21, 2015, for an evidentiary hearing on sentencing issues. The maximum statutory penalty for a violation of wire fraud is 20 years in prison. The actual sentence will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

Docket #: 1:11-cr-219 AWI

SACRAMENTO, Calif. — A Mexican national was sentenced today to 12 years and one month in prison for possessing methamphetamine with intent to distribute, unlawfully possessing a firearm, and aggravated identity theft arising from false statements he made in an application for a U.S. passport, United States Attorney Benjamin B. Wagner and U.S. Department of State, Diplomatic Security Service Special Agent-In-Charge David Zebley announced.

According to court documents, Eliecer Reyes Huerta, 31, had been removed from the United States in 2006 and lacked lawful immigration status to be in the United States. On July 30, 2012, Huerta submitted an application for a U.S. passport to a passport acceptance officer in Vallejo. In the application, Huerta provided a false name belonging to a real person, a false birthdate, and a false birthplace in Puerto Rico. Huerta presented a birth certificate issued for the ID theft victim and a California driver’s license bearing Huerta’s photograph and the victim’s name and birthdate. Agents searched Huerta’s residence in Vallejo and found baggies containing methamphetamine, cocaine, and marijuana; two digital scales, miscellaneous supplies and substances that may be used in the manufacture of controlled substances. In Huerta’s bedroom closet, agents found a 9 mm semi-automatic Sig Sauer Model P226 handgun. Next to the firearm was a Sig Sauer handgun magazine loaded with seven rounds of 9 mm ammunition. Two children were living in the home at the time of the search.

“Individuals who use false or stolen identities are often engaged in other dangerous criminal activities and are a threat to the citizens of the United States," said David Zebley, Special Agent-In-Charge of the Diplomatic Security Service's San Francisco Field Office. “The Diplomatic Security Service is committed to investigating and pursuing anyone who applies for or obtains a United States passport using false documents, particularly when a U.S. Citizen's identity is stolen.”

This case was the product of an investigation by the U.S. State Department’s Diplomatic Security Service with assistance from the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the California Department of Motor Vehicles. Assistant United States Attorney Nirav Desai prosecuted the case.

Docket #: 2:13-cr-408-GEB

WASHINGTON – After a four-day jury trial, a Colorado man was convicted by a federal jury of kidnapping and producing child pornography involving two toddlers, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Benjamin B. Wagner announced.

Shawn McCormack, 31, of Colorado Springs, Colorado, was found guilty of four counts of sexual exploitation of a child and two counts of kidnapping.

US Attorney Wagner stated, “Determined, skillful and cooperative investigative efforts by multiple agencies across the continent led law enforcement to this defendant’s door. We are gratified by today’s verdict, which we hope will provide a measure of justice to the victims, and serve as a warning to those who would seek to harm the most vulnerable among us.”

“Child pornography, when it’s released on the Internet, lives on forever,” said Michael Toms, resident agent in charge for HSI Bakersfield. “It haunts the innocent children whose abuse is depicted in the images, and brings unspeakable pain to their parents and families, knowing that untold strangers are exploiting their worst experiences for their own perverse pleasure. HSI will continue to work closely with its law enforcement partners across the country and around the globe to ensure that those who sexually exploit our children are brought to justice.”

According to evidence presented at trial, McCormack, feigning to be a friend, traveled to a couple’s residence in Bakersfield, California, and stayed as an overnight guest on multiple occasions. During several of the overnight stays, in the middle of the night, McCormack snuck the couple’s toddler out of the house and recorded his sexual abuse of the toddler in a nearby motel, outdoors and in his truck. McCormack then returned the toddler to the house before the parents awoke. The evidence demonstrated that McCormack distributed the images and videos of his abuse to others online, including an undercover officer with the Toronto Police Services.

According to the evidence presented at trial, Homeland Security Investigations agents in Boston found images and recordings distributed by McCormack on a separate defendant’s computer in Massachusetts. The agents were able to identify the date, time and hotel room where one of the videos had been produced. When agents visited that hotel, they learned that McCormack had rented that hotel room on the night when the recording was created. During the investigation, agents uncovered evidence that McCormack had recorded his abuse of both of the couple’s children.

McCormack is scheduled to be sentenced by Senior U.S. District Judge Anthony W. Ishii on July 27, 2015. McCormack faces a possible sentence of 15 to 30 years in prison for each count of production of child pornography, and 20 years to life in prison for each count of kidnapping. The sentence will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case is the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) field offices in Bakersfield, California; Colorado Springs, Colorado; and Boston, Massachusetts, the Bakersfield Police Department, the Colorado Springs Police Department, and the Toronto Police Services. Trial Attorney Maureen C. Cain of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorneys Patrick R. Delahunty and Megan A.S. Richards of the Eastern District of California prosecuted the case.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

Docket #: 1:11-cr-324-AWI

FRESNO, Calif. — A federal grand jury indicted former Fresno deputy police chief Keith Foster and six others today, charging them with a variety of drug trafficking offenses, United States Attorney Benjamin B. Wagner announced.

In addition to Keith Foster, 51, the indictment includes charges against Randy Flowers, 48; Iran Dennis “Denny” Foster, 44; Rafael Guzman, 41; Jennifer Donabedian, 35; and Sarah Ybarra, 37, all of Fresno; and Ricky Reynolds, 30, of Shasta Lake. All defendants are scheduled to be arraigned on the indictment at 1:30 p.m. on Friday, April 10, 2015.

The indictment charges Keith Foster with participating in three separate conspiracies to distribute different controlled substances over the course of the past year. Keith Foster is charged with conspiring with Randy Flowers to distribute oxycodone. They are charged individually in four separate counts to distribute, or possess with the intent to distribute oxycodone. Flowers is further charged with being a felon in possession of three firearms.

Keith Foster and Rafael Guzman are charged with conspiring to distribute heroin. Keith Foster is also charged with conspiring with Reynolds, Donabedian, Ybarra and Denny Foster to distribute marijuana. Reynolds is separately charged with manufacturing marijuana, and both Reynolds and Denny Foster are charged individually in various counts alleging distribution of marijuana. Denny Foster is also charged with being a felon in possession of a firearm. Each defendant is charged in at least one count with using a cellphone in furtherance of a drug trafficking offense. Finally, Denny Foster and Guzman are charged with conspiring to distribute methamphetamine, cocaine and heroin.

This case is the product of an investigation by the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives. U.S. Attorney Wagner expressed his appreciation for the hard work done by the FBI and ATF investigators in the course of the investigation. Assistant United States Attorneys Melanie L. Alsworth and Dawrence W. Rice are prosecuting the case.

If convicted, the defendants face a statutory maximum penalty of 20 years in prison and a $1 million fine for the counts charging controlled substances other than or in addition to marijuana, a maximum of five years in prison and a $250,000 fine for the marijuana-only trafficking offenses, four years in prison and a $250,000 fine for using a cellphone to facilitate the commission of a felony, and a maximum penalty of 10 years in prison and a $250,000 fine for being a felon in possession of a firearm. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.