Southern District of California

NEWS RELEASE SUMMARY – November 6, 2018

SAN DIEGO – Austin Thompson, a Utah resident, pleaded guilty today in federal court in San Diego, admitting that he carried out a series of denial-of-service (“DoS”) computer hacking attacks against multiple victims between 2013 and 2014. 

A denial-of-service (DoS) attack occurs when legitimate users are unable to access information systems, devices, or other network resources due to the actions of a malicious cyber threat actor.  In such attacks, the hacker floods the targeted host or network with traffic until the target cannot respond or simply crashes, preventing access for legitimate purposes. According to the plea agreement, between December 2013 and January 2014, Thompson’s attacks, which flooded his victims’ servers with enough internet traffic to take them offline, were directed mainly at online gaming companies and servers, including then San Diego-based Sony Online Entertainment.  Thompson typically used the Twitter account @DerpTrolling to announce that an attack was imminent and then posted screenshots or other photos showing that victims’ servers had been taken down after the attack.  The attacks took down game servers and related computers around the world, often for hours at a time.  According to the plea agreement, Thompson’s actions caused at least $95,000 in damages.

“Denial-of-service attacks cost businesses millions of dollars annually,” said U.S. Attorney Adam Braverman.  “We are committed to finding and prosecuting those who disrupt businesses, often for nothing more than ego.”

"In today's world, cyber crime is an immense threat that affects private, commercial, and government sectors alike," said FBI Special Agent in Charge John Brown.  "The FBI's capacity to respond to cyber incidents is enhanced through collaboration with affected industries and partnerships in the community to prevent and combat these threats. Together, we will thwart those cyber criminals who target our communities' businesses and infrastructure."

Sentencing is set before United States District Judge Jeffrey Miller on March 1, 2019 at 9:00 a.m.

The case, which is being prosecuted by Assistant U.S. Attorneys Benjamin Katz and John Parmley, arose out of an investigation by FBI’s San Diego Field Office. 

DEFENDANT                                    Case Number  18cr4775JM

Austin Thompson                               Age:    23

SUMMARY OF CHARGES

Damage to a Protected Computer, 18 U.S.C. § 1030(a)(5)(A)

Maximum penalty: 10 years prison, $250,000 fine, 3 years supervised release

AGENCY

Federal Bureau of Investigation – San Diego Field Office

U.S. Air Force Office of Special Investigations

SAN DIEGO, CA – On Wednesday, October 31, 2018, a jury found defendant Carlos Miranda-Alonso guilty of felony assault on a federal officer, in violation of 18 U.S.C. § 111(a)(1), and felony assault on a federal officer with a dangerous weapon, in violation of 18 U.S.C. § 111(b).  The defendant separately pleaded guilty to being an alien who knowingly eluded examination and inspection by immigration officers, in violation of 8 U.S.C. § 1325(a)(2), a misdemeanor.

     According to the evidence presented at trial, the defendant illegally entered the United States on May 10, 2018 by crawling under the International Boundary Fence.  He then spent several hours making his way north before a U.S. Border Patrol Agent stopped the defendant while he was walking out of a protected wildlife estuary and onto a walking path near the Tijuana Estuary Visitor’s Center in Imperial Beach, California.

     When the Border Patrol Agent attempted to handcuff the defendant, the defendant swung his arm, hitting the Agent and breaking his grasp.  The defendant then ran several hundred yards into the estuary and for the next several minutes resisted the Agent’s attempts to capture him by striking the Agent’s arms.  When the Agent managed to get the defendant to the ground, the defendant picked up a section of 4x4 wooden fence post, stood up, and swung it at the Agent.  The Defendant dropped the post after the Agent drew his firearm; no shots were fired.  After approximately 15 minutes, the defendant was apprehended by several other Border Patrol Agents who had arrived on the scene to assist. 

     “United States Border Patrol agents put their lives on the line every single day to protect our borders,” said U.S. Attorney Adam L. Braverman.  “This office will vigorously pursue justice against those who engage in violence against agents carrying out that critical mission.”

     “The safety and well-being of the federal law enforcement officers protecting our nation’s borders are a priority for the Federal Bureau of Investigation,” said John Brown, FBI Special Agent in Charge.  “As shown in today’s conviction, we will fully investigate and bring to justice those who assault officers while carrying out their daily duties in order to keep our country safe.”         

     “I would like to thank the U.S. Attorney’s Office and the Federal Bureau of Investigation for ensuring acts of violent aggression against Border Patrol Agents will not be tolerated.    I am also grateful for the jury’s just decision finding this defendant guilty,” said Chief Patrol Agent Rodney S. Scott. “Assault a U.S. law enforcement officer:  expect to be held accountable.”      

     The sentencing is scheduled for January 22, 2019 at 9:00 a.m. in front of Judge William Q. Hayes.

The Justice Department announced today that Northrop Grumman Systems Corporation (NGSC) has agreed to settle civil allegations that it violated the False Claims Act (FCA), 31 U.S.C. §3729, by overstating the number of hours its employees worked on two battlefield communications contracts with the United States Air Force.  Under the settlement, NGSC, headquartered in Falls Church, Virginia, will make a payment of $25.8 million, which, combined with earlier repayments, will result in a civil recovery of approximately $27.45 million.

“Contractors that knowingly inflate their bills to the government will face serious consequences,” said Assistant Attorney General Joseph H. Hunt for the Department of Justice’s Civil Division. “This settlement demonstrates, once again, that we will not tolerate those who falsely charge the armed forces or any agency of the United States to illegally profit at the expense of the American taxpayer.”

“Federal contracts are not a license to steal from the U.S. Treasury,” said U.S Attorney Adam Braverman.  “DOJ is firmly committed to vigilantly weeding out abuse and will swiftly pursue all available remedies when egregious fraud occurs.”

“Air Force OSI’s Office of Procurement Fraud is dedicated to protecting the taxpayer’s interests worldwide while safeguarding the needs of the warfighter.  This investigation is a testament to AFOSI’s global reach, and to our partnerships with DCIS and the FBI which allowed us to meticulously unravel this international conspiracy to defraud the U.S. Air Force,” said Jason T. Hein, Special Agent in Charge of the Air Force OSI Office of Procurement Fraud, Detachment 6.

“We are committed to ensuring the funds of the American people are used for their intended purpose,” stated John Brown, Special Agent in Charge of the San Diego Field Office - Federal Bureau of Investigation.  “This is another example of the incredible partnerships between the FBI and our Department of Defense counterparts.  Together, uncovering this immense fraud against the government and returning the funds to the American taxpayer is vitally important to ensuring our military receives the honest services they are due.”

The Air Force entered into two contracts with NGSC for battlefield communications services: the Battlefield Airborne Communications Node contract and the Dynamic Re-tasking Capability contract.  Today’s settlement resolves allegations that NGSC billed the Air Force for labor hours purportedly incurred between July 1, 2010, and December 31, 2013, by individuals stationed in the Middle East who had not actually worked the hours claimed.  NGSC also entered into a separate agreement with the Criminal Division of the U.S. Attorney’s Office for the Southern District of California related to these contracts under which it has agreed to forfeit an additional $4.2 million.

The civil settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Southern District of California, the Defense Contract Audit Agency, the Air Force Office of Special Investigations, the Defense Criminal Investigative Service, and the Air Force Materiel Command Law Office Fraud Division.

Except for the conduct admitted in connection with the criminal agreement, the claims resolved by the civil agreement are allegations only, and there has been no determination of civil liability

NEWS RELEASE SUMMARY – November 2, 2018

SAN DIEGO – Northrop Grumman Systems Corporation (“NGSC”), a subsidiary of the Northrop Grumman Corporation, with offices in San Diego, California, agreed today to pay a total of $31.65 million to settle civil and criminal investigations into fraud arising out of its Battlefield Airborne Communications Node (“BACN”) and Dynamic Re-tasking Capability (“DRC”) contracts with the United States Air Force.  NGSC agreed to pay $27.45 million to settle civil allegations that it violated the False Claims Act by overstating the number of hours its employees worked on the BACN and DRC contracts with the United States Air Force.  Additionally, NGSC agreed to forfeit $4.2 million in a separate agreement to resolve a criminal investigation into fraudulent billing on the BACN contract.  In exchange for admitting its employees’ misconduct, making full restitution, and agreeing to cooperate in the ongoing criminal investigation, no criminal charges will be filed against NGSC.

(see the agreement HERE )

In the agreement resolving the criminal investigation of NGSC, the company admitted that its employees deployed to an air base in the Middle East defrauded the Air Force by overbilling time charged to the BACN contract.  Specifically, from January 2011 to October 2013, NGSC employees charged exactly 12 or 13.5 hours per day, seven days a week, despite the fact that the employees were not working those hours.  NGSC admitted that its employees billed time to the BACN contract when its employees were not working and engaged in leisure activities, such as golfing, skiing, visiting local amusement parks, going out to eat or drink, shopping, and enjoying various amenities at the five-star hotels where the employees were housed. 

By inflating their time, the employees working on the BACN contract personally profited and were paid thousands of dollars that they did not earn.  In an email, one NGSC employee summed up the billing practices by saying that they “work[ed] about 6-8 hours and charge[d] 13.”  NGSC admitted that its employees working on the BACN contract overbilled the United States by more than $5 million at one site alone.

“Federal contracts are not a license to steal from the U.S. Treasury,” said U.S. Attorney Adam Braverman.  “DOJ is firmly committed to vigilantly weeding out abuse and will swiftly pursue all available remedies when egregious fraud occurs.”

“Air Force OSI’s Office of Procurement Fraud is dedicated to protecting the taxpayer’s interests worldwide while safeguarding the needs of the warfighter.   This investigation is a testament to AFOSI’s global reach, and to our partnerships with DCIS and the FBI which allowed us to meticulously unravel this international conspiracy to defraud the U.S. Air Force,” stated Jason T. Hein, Special Agent in Charge of the Air Force OSI Office of Procurement Fraud, Detachment 6.

“We are committed to ensuring the funds of the American people are used for their intended purpose,” stated John Brown, Special Agent in Charge of the San Diego Field Office - Federal Bureau of Investigation.   “This is another example of the incredible partnerships between the FBI and our Department of Defense counterparts.  Together, uncovering this immense fraud against the government and returning the funds to the American taxpayer is vitally important to ensuring our military receives the honest services they are due.”

Chris Hendrickson, Special Agent in Charge of the Western Field Office, Defense Criminal Investigative Service, said:  “This settlement demonstrates how defense contractors will be held accountable for making false claims to the United States.  DCIS is committed to working with its law enforcement partners and the Department of Justice to aggressively investigate such matters, and the recovered funds can now be properly used to support the men and women of our Armed Forces.”

Except for the conduct admitted in connection with the criminal agreement, the claims resolved by the civil agreement are allegations only, and there has been no determination of civil liability.

The civil investigation was handled by Assistant U.S. Attorneys Joseph Price and Douglas Keehn and Benjamin C. Wei, Senior Trial Counsel, Fraud Section, Civil Division, Department of Justice.

The criminal investigation was handled by Assistant U.S. Attorneys Michelle L. Wasserman, Billy Joe McLain, Mark W. Pletcher, and Phillip L.B. Halpern.

AGENCIES

Air Force Office of Special Investigations

Defense Criminal Investigative Service

Federal Bureau of Investigation

Defense Contract Audit Agency

Air Force Materiel Command Law Office Fraud Division

For Further Information, Contact:

Assistant U. S. Attorneys Stephen H. Wong (619) 546-9464 and
Lara A. Stingley (619) 546-8403    

Carlos Adolfo Soto and Justin Wayne Caldwell pleaded guilty today in federal court to robbing 10 Metro PCS stores and a Subway restaurant in January and February of 2017.  The charges carry a maximum penalty of 20 years in prison and a $250,000 fine.

Soto was dubbed the “pinky bandit” for his distinctive pinky finger, which protruded out from the weapons he held during a string of eleven robberies beginning on January 25, 2017 and ending on February 21, 2017.  As described in the plea agreements, the robberies targeted Metro PCS stores in and around San Diego County.  In a typical robbery, Soto would enter the store holding a weapon such as a machete, tazer, or pellet gun that resembled a firearm.  Soto would point his weapon at store clerks and demand cellular phones and cash.  Caldwell typically waited outside the store in his vehicle, serving as the getaway driver who helped Soto escape the crime scene.  On at least one occasion, Caldwell also entered the store with a weapon.  For example, on February 14, 2017, the robbers pointed an object that resembled a handgun at a store clerk and forced the clerk into a storage area in the back of the store, kneeling down on his hands and feet, while they loaded a backpack with cellular phones. The robbers then ordered the clerk to open the cash register.

Public filings describe how Special Agents with the Federal Bureau of Investigation and robbery detectives with the San Diego Police Department and the San Diego Sheriff’s Department collaborated to solve this case.  In late January and early February of 2017, investigators noticed a series of robberies around San Diego County that fit a pattern. Ten of the eleven robberies involved Metro PCS cell phone stores and in each the robbers used similar methods, weapons, and disguises. Investigators identified the robbers after one of them registered a cell phone taken during an earlier robbery. Surveillance ultimately led investigators to the scene of the final robbery in the series.  Soto was arrested after a foot chase, during which he dropped merchandise taken during the final robbery.  Officers arrested Caldwell in his car, parked at the scene.

“After striking fear in the hearts of San Diego-area store clerks, these serial robbers were apprehended and charged due to the persistent efforts of dedicated local and federal law enforcement officers,” said U.S. Attorney Adam Braverman.  “Thanks to these efforts our community can rest easier, knowing that the culprits have been brought to justice.”

FBI Special Agent in Charge John Brown stated, “The FBI is committed to working side-by-side with our local partners in these criminal series cases that involve violence, fear, and intimidation in our community.  With today’s convictions, this violent spree of robberies has come to an end.”

Soto and Caldwell have been in custody since February 21, 2017, and are set for sentencing on January 22, 2019 before U.S. District Court Judge Thomas J. Whelan.

Case Number 17-CR-558-W

Defendants

Carlos Adolfo Soto

Justin Wayne Caldwell  

 

Summary of Charges

Hobbs Act Robbery, 18 U.S.C. § 1951

Maximum penalty:  20 years’ imprisonment, $250,000 fine, 3 years’ supervised release

 

Investigating Agencies

Federal Bureau of Investigation

San Diego Police Department

San Diego Sherriff’s Department 

For Further Information, Contact: Assistant U. S. Attorney Sherri Walker Hobson (619) 961-0287    

SAN DIEGO –   Defendant Luis Carlos Melgar-Morales, aka Aquaman, pled guilty today in a San Diego federal district court to international conspiracy to distribute over 10,000 kilograms of cocaine, knowing that the cocaine would be distributed in the United States, in violation of Title 21, United States Code, Sections 959, 960 and 963.  He also admitted to criminal forfeiture in the amount of $1,000,000.

Melgar-Morales, 28, admitted engaging in a two-year conspiracy to import and distribute cocaine in the United States and conceded he was a manager and leader of the responsible drug trafficking organization.  In furtherance of the charged conspiracy, and at direction of Willian Lemus, Melgar-Morales arranged for multiple go-fast vessels to travel in international waters on many occasions to transport bulk cocaine from Colombia and Ecuador, known source countries for the cocaine, to Costa Rica and Guatemala, and from there the drugs would be transported to Mexico and smuggled into the United States.  

Melgar-Morales also facilitated and coordinated the points of travel of the cocaine-laden go fast vessels as they met with refueling vessels on the high seas and communicated to the transportation network about the vessels’ status as they journeyed north.  In addition, he facilitated and coordinated the successful delivery of cocaine vessels from Columbia and Ecuador to Costa Rica and Guatemala. 

Melgar-Morales admitted that the international conspiracy involved the distribution of over 10,000 kilograms of cocaine during the two-year period from January 2016 to January 2018.  Melgar-Morales was also involved in multiple events that resulted in law enforcement seizures including the following: May 19, 2017 (810 kilograms of cocaine); May 23, 2017 (980 kilograms of cocaine); November 9, 2017 (750 kilograms of cocaine); December 16, 2017 (1,082 kilograms of cocaine); and January 27, 2018 (601 kilograms of cocaine).

Homeland Security Investigation (HSI) Special Agents and Customs and Border Protection officers arrested Melgar-Morales at the Los Angeles airport on January 26, 2018, as he was returning to Guatemala, where he resided.  Melgar-Morales’ associate, Willian Lemus-Lara, charged in a separate indictment, was arrested in Guatemala pursuant to an outstanding arrest warrant from the Southern District of California in June 2018, identified in United States v. Willian Lemus-Lara, 18CR0390DMS. Willian Lemus-Lara is currently in extradition proceedings.

 “Federal law enforcement officials worked together in three countries to successfully disrupt a dangerous drug trafficking ring that sought to smuggle 10,000 kilos of cocaine (with a retail value of $600 million) into the U.S.,” said U.S. Attorney Adam Braverman. “Through effective partnerships and excellent intelligence gathering tools, we intercepted significant loads of this highly addictive stimulant, stripped traffickers of drug profits, and helped to safeguard our communities.” 

“Today’s guilty plea highlights the success of collaborative efforts by HSI San Diego, DEA, Customs and Border Protection and other agency partners, as well as our HSI counterparts overseas. This joint effort has resulted in significant seizures of narcotics, firearms and other contraband and has helped law enforcement identify high ranking targets of this criminal organization,” said David Shaw, Special Agent in Charge for HSI San Diego. “HSI will remain committed in our investigative efforts to bring additional members to justice.”

“This case is an excellent example of the whole government approach set forth by the OCDETF Task Forces throughout our country,” said Drug Enforcement Administration Acting Special Agent in Charge Nathan Jones.  “It is a testament to the outstanding men and women in federal law enforcement who work tirelessly day in and day out to identify, target, and bring to justice the drug trafficking and transnational organized crime groups that seek to import illicit drugs into the United States and undermine the very fabric of our nation.”

This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise of federal, state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking, and money laundering organizations and enterprises.

Melgar-Morales’ sentencing date is scheduled for January 18, 2019 at 9:00 a.m. before the Honorable  Dana M. Sabraw, United States District Court Judge.

DEFENDANT                                                                       Case Number 18CR0391DMS                   

Luis Carlos Melgar-Morales, aka Aquaman                         Age: 28           Guatemala

 

SUMMARY OF CHARGES

International Conspiracy To Distribute 10,000 kilograms of cocaine into the United States

Maximum penalty: 10 years minimum to life; $1,000,000 fine; supervised release; $100 special assessment)

 

INVESTIGATING AGENCIES

Homeland Security Investigations (HSI)

Drug Enforcement Administration (DEA)

Customs and Border Protection (CBP)

U.S. Coast Guard

HSI Joint Task Force Investigations (JTF-I)

HSI Attaché Guatemala City, Guatemala

HSI  Attaché Mexico City Mexico

Joint Interagency Task Force-South (JIATF-S)

For Further Information, Contact: Assistant U. S. Attorney Benjamin Katz (619) 546-9604

SAN DIEGO –Nathan Dulley and Andrew Dulley, brothers from Los Angeles, California, pleaded guilty today for their role in trafficking drugs for former USC football player Owen Hanson’s “ODOG” Enterprise, an international drug trafficking, money laundering and illegal gambling syndicate that operated in the United States, Central and South America, and Australia from 2012 to 2016. 

According to court records, the ODOG Enterprise trafficked thousands of kilograms of cocaine, heroin, methamphetamine, MDMA (also known as “ecstasy”), and other drugs, routinely distributing controlled substances at wholesale and retail levels around the world.  The Dulley brothers, who imported and exported fine chocolate, played an integral role in the ODOG Enterprise by shipping large quantities of cocaine from the United States to Australia.  Upon receipt of cocaine from Hanson or his associates – usually in quantities of tens of kilograms or more – the Dulleys would intermix and package the cocaine with legitimate merchandise, so as to disguise the true contents from the shipper and customs authorities.  Using their established import/export routes, the Dulleys would then send the cocaine to Australia, where it was distributed and sold by other members of the ODOG Enterprise.

“Transnational racketeering organizations represent a clear and present danger to the safety and security of our communities.  Those who assist such criminal enterprises by allowing the corruption of their otherwise legitimate businesses will be held accountable for the harm wrought on our communities,” said U.S. Attorney Adam Braverman.

So far, all 22 other defendants charged in connection with this case have pleaded guilty, including:

• Owen Hanson, the founder of the ODOG Enterprise.  Hanson was sentenced to more than 21 years in prison and ordered to pay a criminal forfeiture in the amount of $5,000,000, including $100,000 in gold and silver coins, a Porsche Panamera, two Range Rovers, luxury watches, homes in Costa Rica, Peru, and Cabo San Lucas, a sailboat, and interests in several businesses.
• Giovanni (“Tank”) Brandolino, Hanson’s second in command.  Brandolino was sentenced in February 2018 to 87 months in prison, followed by three years of supervised release.   
• Luke Fairfield, a San Diego based Certified Public Accountant who assisted Hanson with laundering the proceeds of his various illegal endeavors by setting up shell corporations and advising members of the Enterprise on how to structure bank transactions to avoid law enforcement.  On October 2, 2018, Fairfield was sentenced to 21 months in prison.
• Derek Loville, a former professional football player, who pleaded guilty to distributing retail quantities of drugs for the ODOG Enterprise in Arizona.  In July 2017, Loville was sentenced to 15 months in prison and a $5,000 fine.
• Daniel Portley-Hanks, a Los Angeles-based private investigator who assisted Hanson with tracking down delinquent gamblers and other individuals who owed the enterprise money.  Portley-Hanks pleaded guilty and was sentenced to 16 months in prison.  
• Jack Rissell, an “enforcer” who, in one instance, travelled from Southern California to Minneapolis to attack a delinquent gambler in front of his family was sentenced to 24 months in prison.

 

Sentencing for both Nathan Dulley and Andrew Dulley is set for January 22, 2019, before District Judge William Q. Hayes.

The case arose out of a joint investigation by FBI, DEA, and the New South Wales (Australia) Police Force in conjunction with the New South Wales Crime Commission.   Assistant U.S. Attorneys Andrew P. Young, Benjamin Katz and Mark W. Pletcher are prosecuting the case.

 

DEFENDANT                                   Case Number: 18CR4207-WQH

Nathan Dulley                                     Age:    36

Andrew Dulley                                   Age:    34

 

SUMMARY OF CHARGES

Count 1

Conspiracy to Distribute Cocaine, 21 U.S.C. § 846, 841(a)(1)

Maximum penalty: 20 years’ prison, $1,000,000 fine, lifetime of supervised release.

 

AGENCY

Federal Bureau of Investigation – San Diego Field Office

U.S. Drug Enforcement Agency

Internal Revenue Service – San Diego

Australian Crime Commission

New South Wales Police Force

New South Wales Crime Commission

FOR IMMEDIATE RELEASE                                                          

TUESDAY, OCTOBER 30, 2018                                                                         

WWW.JUSTICE.GOV                                                                            

Chinese Intelligence Officers and Their Recruited Hackers and Insiders Conspired to Steal Sensitive Commercial Aviation and Technological Data for Years

Chinese intelligence officers and those working under their direction, which included hackers and co-opted company insiders, conducted or otherwise enabled repeated intrusions into private companies’ computer systems in the United States and abroad for over five years.  The conspirators’ ultimate goal was to steal, among other data, intellectual property and confidential business information, including information related to a turbofan engine used in commercial airliners.

The charged intelligence officers, Zha Rong and Chai Meng, and other co-conspirators, worked for the Jiangsu Province Ministry of State Security (“JSSD”), headquartered in Nanjing, which is a provincial foreign intelligence arm of the People’s Republic of China’s Ministry of State Security (“MSS”). The MSS, and by extension the JSSD, is primarily responsible for domestic counter-intelligence, non-military foreign intelligence, and aspects of political and domestic security. 

From at least January 2010 to May 2015, JSSD intelligence officers and their team of hackers, including  Zhang Zhang-Gui, Liu Chunliang, Gao Hong Kun, Zhuang Xiaowei, and Ma Zhiqi, focused on the theft of technology underlying a turbofan engine used in U.S. and European commercial airliners.  This engine was being developed through a partnership between a French aerospace manufacturer with an office in Suzhou, Jiangsu province, China, and a company based in the United States. Members of the conspiracy, assisted and enabled by JSSD-recruited insiders Gu Gen and Tian Xi, hacked the French aerospace manufacturer.  The hackers also conducted intrusions into other companies that manufactured parts for the turbofan jet engine, including aerospace companies based in Arizona, Massachusetts and Oregon.  At the time of the intrusions, a Chinese state-owned aerospace company was working to develop a comparable engine for use in commercial aircraft manufactured in China and elsewhere. 

Defendant Zhang Zhang-Gui is also charged, along with Chinese national Li Xiao, in a separate hacking conspiracy, which asserts that Zhang Zhang-Gui and Li Xiao leveraged the JSSD-directed conspiracy’s intrusions, including the hack of a San Diego-based technology company, for their own criminal ends.

“For the third time since only September, the National Security Division, with its US Attorney partners, has brought charges against Chinese intelligence officers from the JSSD and those working at their direction and control for stealing American intellectual property,” said John C. Demers, Assistant Attorney General for National Security.  “This is just the beginning.  Together with our federal partners, we will redouble our efforts to safeguard America’s ingenuity and investment.” 

 “State-sponsored hacking is a direct threat to our national security.  This action is yet another example of criminal efforts by the MSS to facilitate the theft of private data for China’s commercial gain,” said U.S. Attorney Adam Braverman.  “The concerted effort to steal, rather than simply purchase, commercially available products should offend every company that invests talent, energy, and shareholder money into the development of products.”

 “The threat posed by Chinese government-sponsored hacking activity is real and relentless,” said John Brown, FBI Special Agent in Charge of the San Diego Field Office. “Today, the Federal Bureau of Investigation, with the assistance of our private sector, international and U.S. government partners, is sending a strong message to the Chinese government and other foreign governments involved in hacking activities.  We are working together to vigorously investigate and hold hackers accountable regardless of their attempts to hide their illicit activities and identities.”

On October 10, the Department of Justice announced that a JSSD intelligence officer was extradited to the Southern District of Ohio, on charges that he attempted to steal trade secrets related to jet aircraft engines, and in September, in the Northern District of Illinois, a grand jury indicted a U.S. Army recruit who is accused of working as an agent of a JSSD intelligence officer, without notification to the Attorney General. 

As the indictment in the Southern District of California describes in detail, China’s JSSD intelligence officers and hackers working at their direction masterminded a series of intrusions in order to facilitate intrusions and steal non-public commercial and other data.  The hackers used a range of techniques, including spear phishing, sowing multiple different strains of malware into company computer systems, using the victim companies’ own websites as “watering holes” to compromise website visitors’ computers, and domain hijacking through the compromise of domain registrars.  

The first alleged hack began no later January 8, 2010, when members of the conspiracy infiltrated Capstone Turbine, a Los-Angeles-based gas turbine manufacturer, in order to steal data and use the Capstone Turbine website as a “watering hole.”   

China’s intelligence service also sought, repeatedly, to hack into a San Diego-based technology company from at least August 7, 2012 through January 15, 2014, in order to similarly steal commercial information and use its website as a “watering hole.”

Chinese actors used not only hacking methods to conduct computer intrusions and steal commercial information, they also coopted victim company employees.  From at least November 2013 through February 2014, two Chinese nationals working at the direction of the JSSD, Tian Xi and Gu Gen, were employed in the French aerospace company’s Suzhou office.  On January 25, 2014, after receiving malware from an identified JSSD officer acting as his handler, Tian infected one of the French company’s computers with malware at the JSSD officer’s direction. One month later, on February 26, 2014, Gu, the French company’s head of Information Technology and Security in Suzhou, warned the conspirators when foreign law enforcement notified the company of the existence of malware on company systems. That same day, leveraging that tip-off, conspirators Chai Meng and Liu Chunliang tried to minimize JSSD’s exposure by causing the deletion of the domain linking the malware to an account controlled by members of the conspiracy.

The group’s hacking attempts continued through at least May of 2015, when an Oregon-based company, which, like many of the other targeted companies, built parts for the turbofan jet engine used in commercial airliners, identified and removed the conspiracy’s malware from its computer systems.

Count Two of the indictment charges a separate conspiracy to hack computers in which Zhang Zhang-Gui, a defendant charged in Count One, supplied his co-defendant and friend, Li Xiao, with variants of the malware that had been developed and deployed by hackers working at the direction of the JSSD on the hack into Capstone Turbine. Using malware supplied by Zhang, as well as other malware, Li launched repeated intrusions that targeted a San Diego-based computer technology company for more than a year and a half.  These intrusions caused thousands of dollars of damage to protected computers.

Count Three of the indictment charges Zhang Zhang-Gui with the substantive offense of computer hacking a San Diego technology company, which was one of the targets of the conspiracies alleged in Counts One and Two.

***

The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty. 

The FBI, led by the San Diego Field Office, conducted the investigation that resulted in charges announced today.  This case is being prosecuted by Alexandra Foster and Sabrina Fève of the United States Attorney’s Office for the Southern District of California and Jason McCullough of the National Security Division’s Counterintelligence and Export Control Section.  The Criminal Division’s Office of International Affairs also provided assistance in this matter, and the Department appreciates the cooperation and assistance provided by France’s General Directorate for Internal Security (DGSI) and the Cybercrime Section of the Paris Prosecutor’s Office during the investigation of this matter.

# # #

13CR3132-H

NEWS RELEASE SUMMARY –  October 25, 2018

SAN DIEGO, CA – On Thursday, October 25, 2018 a federal jury in San Diego, California, found Isaiah Smallwood-Jackson guilty of production of child pornography, in violation of 18 U.S.C. § 2251(a) and enticement of a minor, in violation of 18 U.S.C. § 2422(b), announced United States Attorney Adam Braverman. The convictions trigger mandatory minimum sentences of 15 and 10 years, respectively.  

According to evidence presented at trial, Smallwood-Jackson began communicating with a 14-year-old girl, using the social media application “Spotafriend.” The victim’s profile listed her true age of 14.  Smallwood-Jackson admitted during chats with the victim that he was 21 years old and did not care that the victim was a minor.  Communicating over social media, Smallwood-Jackson discussed sexual acts he wanted to perform with the minor. He convinced her to produce and send him sexually explicit pictures and to provide her address.  The minor repeatedly told Smallwood-Jackson that she was not sure she wanted to meet with him, but he told her to “take a leap of faith.”  He then traveled to her home, convinced her to come outside, and engaged in sexual activity with her.  In texts afterward, Smallwood-Jackson apologized for hurting the minor victim.  She disclosed the event to her sister, who reported it to law enforcement.

“Internet predators beware: the Department of Justice is committed to striking back against repugnant crimes against innocent children," said U.S. Attorney Adam Braverman.  “No child should ever have to endure sexual abuse.  The United States will utilize every tool available to it to hold these predators accountable.”

Defendant is set to be sentenced on January 28, 2019, at 9am before the Honorable Cynthia Bashant.

AGENCIES

This case was investigated by the Oceanside Police Department.  The FBI then pursued federal charges through filing of a federal criminal complaint. 

NEWS RELEASE SUMMARY – October 29, 2018

SAN DIEGO – Jacob Burrell Campos pled guilty today in federal court to operating an unlicensed money transmitting business, in connection with his sale of hundreds of thousands of dollars in Bitcoin to over 1,000 customers throughout the United States from January 2015 to April of 2016.   

            According to the terms of his plea agreement, Burrell admitted to operating a Bitcoin exchange without registering with the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of Treasury, and without implementing the required anti-money laundering safeguards.  According to the plea agreement, Burrell advertised his business on Localbitcoins.com, and communicated with his customers through email and text messages, often using encrypted applications.  He negotiated a commission of 5% above the prevailing exchange rate, and accepted cash in person, through nationwide ATMs, and through MoneyGram.  Burrell admitted that he had no anti-money laundering or “know your customer” program, and performed no due diligence on the source of his customers’ money. 

Burrell admitted that, at first, he purchased his supply of Bitcoin through a U.S.-based, regulated exchange, but his account was soon closed because of the large number of suspicious transactions.  He then resorted to a cryptocurrency exchange in Hong Kong, where he purchased a total of $3.29 million in Bitcoin, in hundreds of separate transactions, between March 2015 and April 2017. 

Finally, Burrell admitted that he exchanged his U.S. currency, which he kept in Mexico, with Joseph Castillo, a San Diego-based precious metals dealer.  Between late 2016 and early 2018, Burrell and others imported over $1 million in U.S. currency on almost a daily basis.  Burrell admitted that they did this in amounts slightly below the $10,000 reporting requirement.  Castillo pled guilty to making a false statement on his federal tax returns, and is awaiting sentencing on December 13, 2018.

According to his plea agreement, Burrell agreed to forfeit to the United States a total of $823,357.00.

            “Unlicensed money transmitting businesses, especially those operating at or near the border, pose a serious threat to the integrity of the US banking system, and provide an ‘open door’ for criminals to utilize such businesses to launder the proceeds of their illicit activities,” said U.S. Attorney Adam Braverman.  “The Department of Justice will continue to investigate and prosecute all individuals and businesses that seek to evade the licensing and anti-money laundering requirements under federal law.”   

            Burrell will be sentenced on February 11, 2019, and faces a maximum of five years’imprisonment.

DEFENDANT                                                Case Number 18CR3554-H

Jacob Burrell-Campos                                    Age: 21                       Rosarito, Baja California, Mexico

Count 1:  Conducting an unlicensed money transmitting business, 18 USC 1960.

Statutory maximum:  5 years prison, $250,000 fine.

AGENCIES

Homeland Security Investigations, Internal Revenue Service, Postal Inspection Service

NEWS RELEASE SUMMARY – October 26, 2018

SAN DIEGO – Arash Sean Soltani of Vista was sentenced yesterday to 15 years in prison, followed by 5 years of supervised release, for possession of methamphetamine and marijuana with intent to distribute and for possession of firearm in furtherance of his drug trafficking activities, by the Honorable Gonzalo P. Curiel, United States District Judge, Southern District of California.

At the time of his guilty plea, Soltani admitted that he possessed four AR15-style rifles, a fully automatic handgun, and several thousand rounds of ammunition to protect his supply of more than half a pound of methamphetamine and 136 marijuana plants and to further his drug trafficking activities.  According to court records, in addition to the firearms, ammunition, methamphetamine and marijuana plants, law enforcement officers also seized marijuana oil extraction equipment, harvested and concentrated cannabis, cannabis oil and a scale with marijuana residue during a search of Soltani’s two homes in Vista. 

“Fighting violent crime is a top priority for our office,” said United States Attorney Adam Braverman.  “San Diego has the lowest crime rate in 49 years and the lowest violent crime rate of all major cities in the nation last year. We will continue to prosecute cases like this to keep San Diego safe.” 

“ATF recognizes the role firearms play in violent crimes and focuses on armed violent offenders and career criminals, narcotics traffickers, violent gang activity, and domestic and international arms trafficker’s” said Bureau of Alcohol, Tobacco, Firearms and Explosives Los Angeles’ Special Agent in Charge Bill McMullan. “ATF will continue to target, investigate and recommend for prosecution these offenders to reduce the level of violent crime and to enhance public safety.”

DEFENDANT                                                Case Number 17CR0843-GPC                               

Arash Sean Soltani                                         Age: 45                                   Vista, CA

SUMMARY OF CHARGES

Count 1, Possession of Methamphetamine and Marijuana with Intent to Distribute, in violation of Title 21, U.S.C. 841 (A)(1)

Maximum penalty: Life in prison and $10 million fine; mandatory minimum 10 years in prison

Count 2, Possession of Firearm in Furtherance of a Drug Trafficking Crime, in violation of Title 18, U.S.C. 924 (c) (1) (A) (i)

Maximum Penalty: Life in prison and $250,000 fine; mandatory minimum five years in prison

AGENCY

Bureau of Alcohol Tobacco Firearms and Explosives

San Diego County Sheriff’s Department

*This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime to make our neighborhoods safer for everyone.   Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

 

NEWS RELEASE SUMMARY – October 19, 2018

SAN DIEGO – Former U.S. Navy Commander Troy Amundson was sentenced today to 30 months in prison, followed by 3 years of supervised release, a $10,000 fine and $21,625.60 in restitution for federal bribery conspiracy charges by the Honorable Janis L. Sammartino of the U.S. District Court for the Southern District of California.  Amundson is the latest U.S. Navy official to plead guilty and be sentenced in the wide-ranging corruption and fraud investigation involving foreign defense contractor Leonard Glenn Francis and his Singapore-based company, Glenn Defense Marine Asia (GDMA).

Amundson, 50, of Ramsey, MN earlier this year pleaded guilty to one count of conspiracy to commit bribery, admitting that he conspired with Francis and others to receive things of value, including entertainment expenses and the services of prostitutes, in exchange for taking official acts for the benefit of GDMA and violating his official duties to the United States Navy. Francis pleaded guilty in 2015 to bribery and fraud charges, admitting that he presided over a massive, decade-long conspiracy involving “scores” of U.S. Navy officials, tens of millions of dollars in fraud and millions of dollars in bribes and gifts – from cash, prostitutes and luxury travel to Cuban cigars, Kobe beef and Spanish suckling pigs.

According to admissions made as part of his guilty plea, from May 2005 to May 2013, Amundson served as the officer responsible for coordinating the U.S. Navy’s joint military exercises with its foreign navy counterparts.  As part of his duties, Amundson was responsible for building and maintaining cooperative relationships with the U.S. Navy’s foreign navy exercise partners.

Amundson admitted that from September 2012 through October 2013, Francis paid for dinner, drinks, transportation, other entertainment expenses, and the services of prostitutes for Amundson and other U.S. Navy officers.  In one instance, Amundson wrote to Francis from a private e-mail account, arranging to provide Francis with internal, proprietary U.S. Navy information:  “Handoff?... [M]y [friend], your program is awesome.  I [Amundson] am a small dog just trying to get a bone… however I am very happy with my small program.  I still need 5 minutes to pass some data when we can meet up.  Cannot print.”  That night, Francis arranged the services of several prostitutes from Mongolia for Amundson. 

Having passed U.S. Navy ship schedules to Francis and having taken numerous other actions in favor of GDMA and in violation of his official duties, Amundson was interviewed by federal criminal investigators in October 2013.  As part of his plea agreement, Amundson admitted that he deleted all of his private e-mail account correspondence with Francis following his interview with law enforcement agents earlier that same day.  As the United States submitted in its Memorandum in Support of Sentencing, “Amundson destroyed evidence of his conspiratorial relationship with Francis after it appeared law enforcement had caught up with him.  In this attempt to cover-up and to destroy evidence, Amundson knew then what he would admit to years later in his plea agreement in this case:  He actively conspired to commit bribery with Francis and GDMA in violation of the law and in abrogation of his official duties to the U.S. Navy.”

“Amundson cavalierly and selfishly traded on a sacred position of trust, selling his honor to a foreign defense contractor in exchange for prostitutes and entertainment expenses,” said U.S. Attorney Adam Braverman.  “We will vigorously enforce the law when a public official puts his own selfish personal interests ahead of the interests of the Navy and our nation.”

So far, 33 defendants have been charged and 21 have pleaded guilty, many admitting they accepted luxury travel, parties and services of prostitutes from Francis in exchange for helping the contractor win and maintain contracts and overbill the Navy by millions of dollars.

The case is being prosecuted by Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California and Assistant Chief Brian R. Young of the Fraud Section of the Justice Department’s Criminal Division.                 

DEFENDANT                                                            Case Number: 18-CR-468-JLS                                   

Commander Troy Amundson                                     Age: 51          Ramsey, Minnesota

SUMMARY OF CHARGES

Conspiracy to Commit Bribery, in violation of 18 U.S.C. § 371

Maximum Penalty: 5 years in prison, a $250,000 fine

INVESTIGATING AGENCIES

Defense Criminal Investigative Service

Naval Criminal Investigative Service

Defense Contract Audit Agency

 

 

NEWS RELEASE SUMMARY – October 16, 2018

SAN DIEGO – The Department of Justice announced today a series of measures to target and dismantle the Cartel Jalisco Nueva Generacion (CJNG) – one of the largest, most dangerous drug cartels currently operating in Mexico. As part of those measures, the U.S. Attorney’s Office for the Southern District of California, announces the indictment of CJNG leader, Juan Perez-Vargas, aka Piolin.

A federal grand jury in San Diego returned a sealed indictment on January 27, 2017, charging Perez-Vargas, with Conspiracy to Distribute Controlled Substances Intended for Importation, and Conspiracy to Import Controlled Substances. On January 30, 2017, the Clerk of the Court issued a sealed warrant for his arrest. On September 20, 2017, Perez-Vargas was arrested in Guadalajara, Mexico pursuant to these charges in the United States and is currently awaiting extradition to San Diego.

CJNG is one of the most powerful cartels in Mexico and the Department of Justice considers it to be one of the five most dangerous transnational criminal organizations in the world, responsible for trafficking numerous tons of cocaine, methamphetamine and fentanyl-laced heroin into the United States. Founded in 2011, CJNG has grown in size and strength rapidly since its inception. Today, the DEA estimates the CJNG exerts influence in 23 of 31 (75 percent) of Mexican states, including key drug production and transportation corridors. CJNG is also responsible for significant amounts of violence and loss of life in Mexico. CJNG gained its power in Mexico as a result of the organization’s disciplined command and control, sophisticated money laundering techniques, efficient drug transportation routes, and extreme violence. The cartel has also expanded globally, with significant presence and illicit business not only throughout the United States and Mexico, but also Europe, Asia, and Australia.

The unsealed indictment marks the conclusion of the initial phase of a multi-year OCDETF investigation. This joint Homeland Security Investigations (HSI) and Drug Enforcement Administration (DEA) investigation targeted the leadership elements, lieutenants, associates, and money launderers connected with CJNG, the Rafael Caro-Quintero (RCQ) DTO and Beltran Leyva Organization (BLO).

“With today’s announcement, the Attorney General has made clear the Department’s focus on dismantling transnational criminal organizations,” said U.S. Attorney Adam L. Braverman. “This indictment proves yet again that the Southern District of California will take the lead to relentlessly target and bring to justice the most significant drug kingpins no matter where they operate.”

U.S. Attorney Braverman also praised the outstanding work of the federal team from HSI Calexico / DEA Imperial County in the culmination of this investigation. U.S. Attorney Braverman also thanked Customs and Border Protection, the U.S. Marshals Service, the U.S. Department of Justice’s Office of Enforcement Operations and the Office of International Affairs for their ongoing assistance in this investigation.

“Today’s Indictment is an example of the dedicated and collaborative efforts by HSI Calexico and DEA Special Agents,” said David Shaw, Special Agent in Charge for HSI San Diego.  “This joint effort allowed for the opportunity to narrow the investigation, identify more high level targets and significantly impact the cartel leadership structure. HSI agents remain committed to working with our partners and prosecutors in bringing additional members of this transnational criminal organization to justice.”

“Together with our law enforcement partners, DEA continues to target and take down some of the highest-level drug traffickers in the world,” said DEA San Diego Special Agent in Charge Karen Flowers. “CJNG is in our crosshairs and this indictment reflects that we will ensure that drug traffickers pay a very high price for their crimes.”

This case is also the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF) a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

DEFENDANT                                                                       Case Number 17CR219-CAB               

Juan Perez-Vargas, aka Piolin                                 Age: 37                   Guadalajara, Mexico                   

SUMMARY OF CHARGES

Conspiracy to Distribute Controlled Substances for Purpose of Unlawful Importation, in violation of Title 21 U.S.C. §§ 959, 960 and 963; Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10,000,000 fine and 5 years supervised release.

Conspiracy to Import Controlled Substances, in violation of Title 21 U.S.C. §§ 952, 960 and 963. Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10,000,000 fine and 5 years supervised release.

AGENCIES

Homeland Security Investigations

Drug Enforcement Administration

Customs and Border Protection, Office of Field Operations

United States Marshals Service

Department of Justice, Organized Crime Drug Enforcement Task Forces

Department of Justice, Office of Enforcement Operations

Department of Justice, Office of International Affairs

Customs and Border Protection, Office of Border Patrol

Immigration and Customs Enforcement, Enforcement and Removal Operations

El Centro Police Department

Brawley Police Department

Imperial County District Attorney’s Office

Imperial Valley, Law Enforcement Coordination Center

 

*An indictment or complaint is not evidence that the defendant committed the crimes charged. The defendant is presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.

NEWS RELEASE SUMMARY – October 12, 2018

SAN DIEGO – One year ago, the Department of Justice announced the revitalization and enhancement of Project Safe Neighborhoods (PSN), which Attorney General Sessions has made the centerpiece of the Department’s violent crime reduction strategy.  This program focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.  PSN brings together a wide array of community leaders to identify the most pressing violent crime problems and develop comprehensive solutions to address them. 

In the Southern District of California (SDCA), the PSN program operates primarily as a collaboration between the United States Attorney’s Office and the San Diego County District Attorney’s Office.  Utilizing intelligence from both local and federal law enforcement, these two prosecutorial offices (the largest two in the region) work to determine which jurisdiction (state or federal) will be able to provide the greatest impact for the community.  In the past year, the PSN partnership has frequently resulted in the deployment of federal enforcement resources against violent offenders who might face a much smaller sanction in state court.

Nationally, the FBI’s official crime data for 2017 reflects that the violent crime rate decreased by approximately one percent in 2017, while the homicide rate decreased by nearly one and a half percent.  Locally, San Diego has achieved its lowest crime rate in the past 49 years and we had the lowest violent crime rate of America’s largest cities last year.  A recent SANDAG (San Diego Association of Governments) report indicates that guns are used less often in violent crimes in San Diego than the national average.  

“Project Safe Neighborhoods is a proven program with demonstrated results,” Attorney General Jeff Sessions said. “We know that the most effective strategy to reduce violent crime is based on sound policing policies that have proven effective over many years, which includes being targeted and responsive to community needs.  I have empowered our United States Attorneys to focus enforcement efforts against the most violent criminals in their districts, and directed that they work together with federal, state, local, and tribal law enforcement and community partners to develop tailored solutions to the unique violent crime problems they face.  Each United States Attorney has prioritized the PSN program, and I am confident that it will continue to reduce crime, save lives, and restore safety to our communities.”  

“San Diego’s violent crime rate was the lowest of every major city in the nation last year due to effective partnerships,” stated U.S. Attorney Adam Braverman.  “Our federal prosecutors work hand-in-hand with local law enforcement agencies to successfully prosecute significant cases involving guns, drugs and gangs and to collaborate on evidence-based prevention efforts.  This approach has delivered clear results in the form of safer neighborhoods.”

Between fiscal year 2017 and fiscal year 2018, cases designated and prosecuted by the United States Attorney’s Office under the Project Safe Neighborhoods Program rose 75 percent; from approximately 79 cases in 2017 to 139 cases in fiscal year 2018.  These increases occurred at the same time as the United States Attorney’s Office increased the number of cases brought in other priority areas including narcotics trafficking and immigration enforcement.  Efforts to increase prosecutions for fiscal year 2019 are already underway.  Three recent examples highlight the types of the cases brought for federal prosecution, all aimed at making the Southern District of California safer:

• On September 6, 2018, Lorne Turman pleaded guilty in federal court for his role in a series of armed robberies throughout San Diego County.  See U.S. v. Bickham, et al., 18-CR-2557-JLS.  In his plea agreement, Turman admitted that he used a shotgun to rob a series of local businesses (known to local media as the “Grinch Bandit” robbery series).  Under the terms of the agreement, the United States will be recommending a 42-year prison sentence for Turman.
• On July 18, 2018, Tony Hwong, a Westside Luni Mob gang member, was sentenced to 10 years in federal prison for possessing a firearm while selling methamphetamine. See U.S. v. Hwong, 18-CR-059-WQH.  Hwong was originally arrested by members of the San Diego Police Department during a probation sweep but was diverted for federal prosecution based on the threat he posed to the community.
• On October 2, 2018, Chad Kipper, the former CEO of the Freedom Fighters Foundation, was convicted of felony gun trafficking.  See U.S. v. Kipper, 18-CR-2460-BAS.  Kipper admitted that he had falsely claimed to be an Arizona resident during fourteen firearms-purchases in Arizona during 2016.  Learn more about Kipper’s prosecution. 

 

The United States Attorney’s Office furthers PSN’s prevention mission by convening stakeholders, forging diverse partnerships, providing mentors, and using the following novel approaches to reduce violent crime:

• Because youth are often groomed and recruited by gangs before middle school, the USAO partnered with community groups as well as county health, local law enforcement and school officials to launch “Success Agents,” an innovative program that offers at-risk 4th graders at Porter Elementary mentors and wrap-around support from 4th through 8th grade. A USAO-led team meets weekly with Success Agents kids, providing interactive workshops to improve decision-making, foster relationships and academic achievement, and expand horizons.  Based on promising initial results, the San Diego Juvenile Justice Commission honored Success Agents for impressive teamwork in action and the San Diego District Attorney’s Office expanded it earlier this year to an additional elementary school.
• The USAO coordinates an 8-week Project Lead program in targeted elementary schools in a Southeast San Diego neighborhood affected by gangs and violent crime.  The team’s efforts significantly expanded youth education on drug, alcohol and gang refusal skills, preparing more than 1,500 vulnerable 5th graders to make wise choices when asked to join gangs, use drugs, tag a building, or skip school. The program also builds strong relationships between students and federal law enforcement agents from many agencies, including the USAO, CBP, the Secret Service, and the U.S. Marshal’s Service. 
• The USAO participates in the city’s creative Community Assistance Support Team (CAST), a stakeholder group designed to curb gang violence by partnering police with former gang and community members. Members work together immediately after shootings to prevent retaliation and escalation.  Through CAST, the USAO meets regularly with police officers, Deputy Sheriffs, community activists, local pastors and community leaders to review violent incidents, discuss resources and needs, share information, and solve problems.

 

These enforcement actions and partnerships are part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime. Learn more about Project Safe Neighborhoods.

NEWS RELEASE SUMMARY –  October 11, 2018

            San Diego, California  – Defendant Alejandro Barba pled guilty today to conspiracy to distribute methamphetamine, which carries a 10 year minimum mandatory sentence, before Magistrate Judge Nita Stormes of the U.S. District Court for the Southern District of California.   

            On May 1, 2018,  Barba, who was parked on the grounds of San Ysidro High school, received five kilograms of methamphetamine from a juvenile courier who attended San Ysidro High School.  Barba was arrested shortly thereafter by the San Diego Sheriff’s Office Border Suppression Team.  Special Agents with Homeland Security Investigation and Drug Enforcement Administration assisted in the investigation.       

            During his guilty plea today, Barba admitted picking up methamphetamine on multiple occasions at the San Ysidro High School parking lot from juveniles, who smuggled methamphetamine into the United States. 

            His next court appearance is on January 4, 2019 for sentencing before District Court Judge Anthony Battaglia.

DEFENDANT

 

Criminal Case No. 18CR2850AJB

Alejandro Barba                         27 years old        San Diego, California

CHARGE

Conspirary To Distribute Methamphetamine (21 U.S.C. 841 & 846)

10 years minimum to life in custody; $1,000,000 fine

AGENCIES

San Diego County Sheriff’s Department

SDCO’s Border Suppression Team

Homeland Security Investigations

Drug Enforcement Administration

Assistant U. S. Attorney Michael A. Deshong (619) 546-9290  

NEWS RELEASE SUMMARY – October 10, 2018

SAN DIEGO – Suspected drug dealer Trevon Lucas was indicted by a federal grand jury for distributing fentanyl that caused the death of a La Jolla resident, identified only as C.A.S. in court filings.

According to statements made by prosecutors at his detention hearing yesterday, C.A.S. was found dead in his mother’s home on the morning of June 30, 2018.  Evidence obtained from C.A.S.’s cellular phone and a parking lot surveillance camera indicate he met Lucas to purchase prescription oxycodone pills around 11:20 p.m. the night before his mother found his body. Law enforcement officials recovered counterfeit oxycodone pills that contained fentanyl from C.A.S.’s residence, and the medical examiner has since identified fentanyl intoxication as the cause of death.    

Lucas and three other residents of the Highland / San Bernardino area—Cenclair Fields, Donovan Carter, and Kevin Chandler—were also indicted for their roles in an ongoing conspiracy to distribute pharmaceutical pills containing hydrocodone. Law enforcement officials have gathered evidence indicating that Lucas and Carter posted advertisements on a well-known website to illegally sell prescription pills.

“Fentanyl is claiming record numbers of victims, most of whom don’t even know they’re swallowing a pill that’s laced with the deadly drug,” said U.S. Attorney Adam Braverman. “Those who sell fentanyl resulting in death will be held accountable for their callous and reckless disregard for human life.”

“We’re seeing a dangerous trend of drug dealers and cartels cutting various drugs with fentanyl, which is a recipe for death,” said District Attorney Summer Stephan. “When you sell fentanyl to another human being, you are providing them with toxic poison that can kill them in a matter of seconds. Even a tiny amount of fentanyl can be deadly, which is why we’re working with our partners at the U.S. Attorney’s Office, and Drug Enforcement Administration to address this disturbing trend.”

“Unless you buy your prescription pills from a legitimate pharmacy, it’s very likely you’ll get fake prescription pills laced with deadly fentanyl,” said DEA Special Agent in Charge Karen Flowers.  “Individuals seeking to make an easy buck are putting fentanyl into fake pills and passing them off as legitimate prescription medications. DEA and our law enforcement partners will continue to target and relentlessly pursue the individuals who are selling fake prescription pills laced with deadly fentanyl to citizens in our community.”

Lucas, Carter, Chandler, and Fields made their initial appearances in federal court Friday, October 5, before U.S. Magistrate Judge Barbara L. Major, followed by a detention hearing yesterday morning.  Judge Major detained Lucas based on the seriousness of the charges against him, while setting bonds for Fields, Carter and Chandler.  Their next hearing is scheduled for November 9, 2018 before U.S. District Judge Cathy Ann Bencivengo.

Lucas is the fifth person since January to be charged in the Southern District of California with Distribution of Fentanyl Resulting in Death. This case involved a collaborative effort between the United States Attorney’s Office and the San Diego County District Attorney’s Office. 

 DEFENDANTS                                           Case Number 18cr4224-CAB         

Trevon Antone Lucas                                     Age: 23                                   Highland, CA

Cenclair Marie Fields                                     Age: 23                                   Highland, CA

Kevin Vandale Chandler                                Age: 24                                   Highland, CA

Donovan Adontas Carter                                Age: 23                                   San Bernardino, CA

SUMMARY OF CHARGES

Distribution of Fentanyl Resulting in Death – Title 21, U.S.C., Section 841(b)(1)(C)

Maximum Penalty: Mandatory minimum 20 years’ imprisonment up to life

Conspiracy to Distribute and Possess with Intent to Distribute Hyrdrocodone – Title 21, U.S.C., Sections 846 and 841(a)(1) & (b)(1)(C)

Maximum Penalty: 20 years

AGENCIES

Drug Enforcement Administration

San Diego Police Department

Homeland Security Investigations

California Department of Health Care Services

Federal Bureau of Investigation

San Diego County District Attorney’s Office

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

 

Assistant U.S. Attorney Cindy Cipriani 619-546-9608

NEWS RELEASE SUMMARY – October 4, 2018

SAN DIEGO – U.S. Attorney Adam Braverman today announced several significant U.S. Department of Justice (DOJ) grants to San Diego entities, each of which submitted competitive proposals to increase public safety by preventing and/or responding to emerging crime problems.  The awards include:

• A total of $2,615,000 to Alliance for HOPE International (Alliance), a non-governmental organization that works to end violence against women, children and families. Of this sum, $2,165,000 will be used to streamline the case intake and service delivery process at Family Justice and Multi-Agency Centers and other victim service provider organizations. The revised system will increase agency coordination, provide easier access to services, and allow for data aggregation at the national level to improve service delivery and effectiveness for human trafficking survivors. The project will also integrate cutting-edge tools into the intake and assessment process, allowing Centers to quickly determine victims’ needs, streamline referrals, and automate and track effective service delivery. Alliance will also receive $450,000 to provide trainings and technical assistance to Family Justice Centers throughout the United States. In partnership with the National Center on Domestic Violence, Trauma, and Mental Health, the Alliance will provide training and technical assistance focused on building the capacity of Family Justice Centers/Multi-Agency Centers, as well as other co-located service centers, to provide effective services to survivors of domestic violence and sexual assault with substance use-related needs.
   
• $1,973,347 to the San Diego-based Identity Theft Resource Center (ITRC) to create technology solutions designed to help victims of identity crimes receive immediate assistance and reduce the risk of further victimization. ITRC plans to expand hours of service, improve tools for faster intake, develop the capability to offer immediate customized recommendations and resources, expand remediation tools, incorporate a data breach risk score, include real time alerts and additional remediation tools on an identity theft app, provide ways for victims to self-report and access case information, and launch an outreach campaign to increase awareness of ways to mitigate risks associated with identity crime.
   
• $1,200,000 to Rady Children’s Hospital Center to develop and strengthen Children's Advocacy Centers (CACs) and Multidisciplinary Child Abuse Teams (MDTs) in 13 states in the Western region. These funds will be used for conferences; information dissemination; on-site technical assistance and team training; multidisciplinary and discipline-specific training; use of innovative technologies; mentoring of CAC programs; CAC leadership development; and chapter development to strengthen state networks and develop new programs. The Chadwick Center for Children and Families at Rady Children’s Hospital – San Diego (RCHSD) will manage the Western Regional Children’s Advocacy Center (WRCAC). The WRCAC will help communities develop multidisciplinary teams and local programs, such as child advocacy centers, to better respond to child abuse and neglect, especially child sexual abuse, child sex trafficking, and severe physical abuse. It will also deliver training and technical assistance to strengthen existing functions in the 13 western states.
   
• $ 931,395 to the City of Escondido Police Department to create and begin implementing a strategic, collaborative, and community-oriented plan to reduce crime.  The City plans to identify, verify, and prioritize crime hot spots within a specific target neighborhood; work with cross-sector team and law enforcement partners to develop a multi-faceted strategy, using multiple approaches to address crime drivers; pursue community partnerships; engage the community by employing innovative approaches to collecting resident input; and collaborate with local law enforcement, a research partner/team, and the community to conduct analysis of crime drivers and an assessment of needs and resources.  The project managers plan to have neighborhood residents play an active role.
   
• $700,000 to San Diego Youth Services to enhance the specialized services available to assist victims of human trafficking by increasing interagency collaboration and ensuring a coordinated community response to victims.  This grant will fund provision of high-quality, specialized services that address the individual needs of trafficking victims, including housing, economic and leadership empowerment, mental health, substance abuse, and legal services. The program will also support efforts to increase the capacity of communities to respond to human trafficking victims through the development of interagency partnerships, professional training, and public awareness activities.
   
• $500,000 to the Escondido Education Compact, to support youth mentoring organizations that have a demonstrated partnership with a juvenile justice agency to provide mentoring services to youth screened as posing low risk to public safety. The goal of Project Hero, a diversion program that emphasizes the dual goals of rehabilitation and accountability, is to improve the quality of life for at-risk and high-risk juvenile justice system-involved youth, families, and communities by directly influencing youth outcomes. The program will target improved academic performance, reduced dropout rates, juvenile delinquency, substance use, and gang participation. To achieve this goal, the compact will provide high-quality, evidence-based mentoring services tailored to the needs of at-risk and high-risk youth referred to the program through the Escondido Police Department or other law enforcement agencies. By matching youth with mentors, the program intends to reduce recidivism and support academic achievement and school attendance.
   
• $ 401,136 to the City of San Diego for the Internet Crimes Against Children (ICAC) Task Force, to  prevent, interdict, investigate and prosecute technology-facilitated child exploitation and Internet crimes against children; improve task force effectiveness by educating, training and empowering local School Resource Officers and Juvenile Investigators; and engage in community outreach activities including training, prevention, and education seminars.
   
• $373,037 to the Strong Hearted Native Women’s Initiative, Inc., which serves tribal reservations and communities located in the counties of San Diego, Santa Barbara, San Bernardino, and Riverside. Additionally, SHNWC also works with many of the non-native service providers within San Diego and Riverside Counties, including four shelter programs and three rape crisis centers, as well as with San Bernardino-Riverside Indian Health under the Kiicha safe home project. With this award, SHNWC will provide technical assistance, training, and services to the community service area to enhance access and awareness to services for victims of domestic violence, sexual assault, dating violence, stalking, and sex trafficking.

 

“The U.S. Department of Justice is committed to keeping our community safe by supporting innovative programs that both prevent crime and showcase best practices in supporting victims,” said U.S. Attorney Adam L. Braverman.  “These grant awards will benefit San Diego and, in some instances, the entire country, by increasing awareness, upgrading crime reporting options, offering critical assistance to those who need it during an extremely difficult time in their lives, and connecting vulnerable communities to law enforcement resources.” 

 

  

 

Assistant U.S. Attorney Melanie K. Pierson (619) 546-7976

NEWS RELEASE SUMMARY – October 1, 2018

SAN DIEGO – A Tucson firm and two executives were recently sentenced to pay over $1.2 million in fines, forfeiture and restitution for the illegal trafficking in sea cucumber from 2010-2012.

In May of 2017, Blessings, Inc. of Tucson, its owner David Mayorquin, and former executive Ramon Torres Mayorquin of San Diego were charged in a 26-count indictment with conspiracy, illegal trafficking in wildlife, importation contrary to law, false labeling and criminal forfeiture related to the importation of $17 million of sea cucumber.

Blessings, Inc. pleaded guilty on March 8, 2018, admitting that the company conspired to illegally export sea cucumber to Asia. Defendant Ramon Mayorquin also pleaded guilty, acknowledging that he imported the sea cucumber into the United States from Mexico by means of documents containing false information. And, defendant David Mayorquin pleaded guilty, admitting that the sea cucumber he imported into the United States had been taken, possessed, transported or sold in violation of Mexican law.

At a hearing on September 17, 2018, U.S. District Judge Roger T. Benitez sentenced Blessings, Inc. and David Mayorquin to pay a fine of $973,490, and directed that half of the fine be deposited in the Lacey Act Rewards Fund and the other half into the Magnuson Stevens Fishery Conservation and Management Act Fund.  In addition, Blessings, Inc. was ordered to forfeit $237,879 in proceeds from the offense, and David Mayorquin was ordered to pay $40,000 to the government of Mexico as restitution for the loss of its natural resources.  All three defendants were placed on probation.

The Lacey Act Reward Account was established to accept any fine, penalty or forfeiture of collateral money collected for offenses involving either the Lacey Act or the Endangered Species Act in accordance with provisions of the 1981 Lacey Act Amendments.  Examples of how these funds may be used include to provide monetary awards to those who provide information about wildlife crimes and to pay costs incurred in caring for fish, wildlife or plants that are being held as evidence in ongoing investigations.  The Magnuson Stevens Fishery Conservation and Management Act Fund is used for rewards to those providing information that leads to enforcement action and costs related to investigations.

According to the Fish and Wildlife Service, there are about 1,200 species of sea cucumbers worldwide. Found on the ocean floor, sea cucumbers act as filters taking in various types of detritus, including carcasses and excrement, and expelling filtered material. This action helps keep the ocean floor free of organic matter that could lead to algae blooms. Through this process, sea cucumbers help protect coral reefs because the material they excrete includes calcium carbonate, a key building block of coral.

In many parts of the world, sea cucumbers are sought after as a delicacy and as a medicine and aphrodisiac. This has fueled demand and increased illegal trade of this species. Unfortunately, the illegal trade in sea cucumbers is leading to sharp declines of the species in parts of the world.

With increased cooperation with Mexican officials, the importation of sea cucumber from Mexico to the United States through the ports of entry in San Diego have decreased dramatically in the past four years. According to the NOAA Office of Science and Technology, Commercial Fisheries Statistics Division website, total sea cucumber imports from 2013 through 2017 into the San Diego ports of entry have decreased from 1,096,258 kg in 2013 to 63,545 kg in 2017.

“Illegal trafficking in fish and wildlife is big business,” said U.S. Attorney Adam L. Braverman.  “This case demonstrates our commitment to work together with our law enforcement partners to prosecute such criminals and take away their unlawful profits.”

“Protecting marine resources and combating wildlife trafficking is an important part of NOAA's mission,” said James Landon, Director of NOAA's Office of Law Enforcement. “This case demonstrates the results of partnerships and cooperation between enforcement agencies to achieve such a strong result.”

“Wildlife trafficking is a serious crime that impacts plants, animals and insects around the world,” said Edward Grace, Acting Assistant Director of the U.S. Fish and Wildlife Service’s Office of Law Enforcement. “We are committed to working with others to protect at-risk species, like sea cucumbers, and hope the sentencing in this case will send a strong message to those who choose to defy the law.”

“A large overseas demand for sea cucumbers harvested in Mexico has fueled an increase in illicit importation-schemes uncovered at commercial ports of entry on the U.S.-Mexico border,” said Dave Shaw, special agent in charge for Homeland Security Investigations in San Diego. “This investigation underscores HSI’s commitment to ensuring U.S. trade laws are not exploited by those seeking financial gain.”   

DEFENDANTS                                 Criminal Case No. 17cr1254-BEN

Blessings, Inc                                      Incorporated: 2003

Tucson, Arizona

David Mayorquin                                Age: 41                                  

Tucson, Arizona
Ramon Torres Mayorquin                   Age: 77

Chula Vista, California

SUMMARY OF CHARGES

Count 1 (Defendant Blessings)

Conspiracy, 18 U.S.C. § 371

Maximum penalty: 5 years’ prison, fine of $250,000

Count 12 (Defendant Ramon Mayorquin)

Importation Contrary to Law, 18 U.S.C. §545

Maximum Penalty: 20 years’ prison, $250,000 fine or twice the gross gain or loss caused by the offense, restitution, forfeiture of proceeds generated from the, five years of supervised release.

Counts 1 & 2 of Superseding Information (David Mayorquin)

Illegal Importation of Wildlife, 16 U.S.C. §3372(a)(2)(A) and §3373(d)(2)

Maximum Penalty: 1 year of prison, $100,000 fine per count

AGENCIES

National Oceanic and Atmospheric Administration, Office of Law Enforcement

U.S. Fish & Wildlife Service, Office of Law Enforcement

Homeland Security Investigations

 

Assistant U. S. Attorney Andrew R. Haden (619) 546-6961    

NEWS RELEASE SUMMARY – October 2, 2018

SAN DIEGO – Chad Clay Kipper, the former Chief Executive Officer of the Freedom Fighters Foundation, pleaded guilty in federal court yesterday, admitting to the unlicensed purchase and transportation of firearms.

According to court documents, in January 2018, the Bureau of Alcohol Tobacco Firearms and Explosives (ATF) became aware of a private firing range in San Diego where individuals were reportedly firing fully automatic firearms in close proximity to a nearby neighborhood.  A subsequent investigation revealed that Chad Clay Kipper was listed with the California Secretary of State as the Chief Executive Officer of the Freedom Fighters Foundation, the non-profit organization that owns the firing range. 

Record checks into Kipper revealed that he had not registered any fully automatic weapons with the State of California.  The checks also revealed that Kipper, a longtime resident of Carlsbad, had been purchasing firearms in Arizona and had then quickly resold several of them in California for a profit. 

On Monday, Kipper pleaded guilty to felony gun trafficking before U.S. District Judge Cynthia A. Bashant.  In his plea agreement, Kipper admitted that he had falsely claimed to be an Arizona resident during 14 firearms purchases in Arizona during the year 2016.  He also admitted to being the former Chief Executive Officer of the Freedom Fighters Foundation.

It is a federal crime to make material misrepresentations during the purchase of a firearm.  Federal statutes also make it illegal to purchase and transport firearms from one state back to your state of residence, unless you are a licensed firearms dealer.

After pleading guilty, Kipper was sentenced and is now a convicted felon. As such, he is prohibited by both federal and state laws from ever possessing a firearm. As part of his guilty plea, Kipper also forfeited 16 firearms to the United States that he had unlawfully obtained or possessed.  The list of forfeited firearms includes assault-style rifles and handguns.

“The Department of Justice takes federal firearms statute violations very seriously,” said U.S. Attorney Adam Braverman. “The trafficking of illegal guns in our communities is a threat to public safety and won’t be tolerated.”

 “It is imperative individuals follow the federal firearms laws, to reduce the risk of public safety caused by firearms trafficking.” said Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Los Angeles Field Division Special Agent in Charge Bill McMullan. “The mission of ATF is to protect communities from violent criminals, criminal organizations, and the illegal use and trafficking of firearms. As a result of this individual’s actions of lying and buying, he will never be allowed to legally own a gun.”

DEFENDANTS                                            Case Number 18-CR-2460-BAS                             

Chad Clay Kipper                                           Age: 34                                   San Diego, CA

SUMMARY OF CHARGES

Unlicensed Transportation of Firearms – Title 18, U.S.C., Section 922(a)(3)

Maximum penalty: 5 years’ imprisonment and $250,000 fine

AGENCY

Bureau of Alcohol Tobacco Firearms and Explosives (ATF)

*This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime to make our neighborhoods safer for everyone.   Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

Assistant U. S. Attorneys Andrew Young (619) 546-7981, Benjamin J. Katz (619) 546-9604 and Mark W. Pletcher (619) 546-9714

NEWS RELEASE SUMMARY – October 2, 2018

SAN DIEGO – Luke Fairfield, a San Diego-based Certified Public Accountant, was sentenced today to 21 months in prison for his role in the criminal enterprise led by former USC football player Owen Hanson – an international drug trafficking, gambling, and money laundering organization known as “ODOG.”

Hanson operated ODOG in the United States, Central and South America, and Australia from 2012 to 2016, trafficking in thousands of kilograms of cocaine, heroin, methamphetamine, MDMA (also known as “ecstasy”), and other illegal drugs in wholesale and retail quantities.  The ODOG enterprise also operated a vast illegal gambling network focused on high-stakes wagers placed on sporting events.  To carry out its gambling operation, the ODOG enterprise employed numerous bookies and money runners, and in the event a customer did not pay his gambling debt, the ODOG enterprise employed enforcers to threaten, intimidate, and injure its own customers in order to force compliance.

As Fairfield admitted when pleading guilty in March of 2017, his role in the ODOG enterprise included laundering money, aiding in the creation of shell companies to hide ODOG’s criminal proceeds, and training ODOG money runners on methods and tactics to hide the enterprise’s activities from law enforcement and banks.  On one occasion, Fairfield personally transferred proceeds of Hanson’s Australian drug trafficking to the United States using an alias and fake identification.  Fairfield also worked with Hanson to track the collection of debts from bookies and gamblers who owed the ODOG enterprise hundreds of thousands of dollars from illegal bookmaking. 

Because of this conviction, Fairfield is no longer licensed as a CPA. The defendant, who is free on bond, was ordered to surrender on November 9, 2018.

“Transnational racketeering organizations like Hanson’s are a threat to the safety and security of our communities, and we are committed to prosecuting the corrupt professionals, like Fairfield, who use their specialized skills to help criminal organizations,” said U.S. Attorney Adam Braverman.

“Money laundering is the grease that allows the wheels of Transnational Criminal Organizations to turn,” said John Brown, FBI Special Agent in Charge of the San Diego Field Office. “Today’s sentencing of Fairfield sends a clear message that business professionals who facilitate the finances of these organizations not only risk losing their professional licenses but also face the prospect of time in prison.  This conviction would not have been possible without the significant contributions of the Internal Revenue Service and the New South Wales Police Force.”

Fairfield is the last of 22 defendants charged in the case to be sentenced.  The case arose out of a joint investigation by FBI, DEA, and the New South Wales (Australia) Police Force in conjunction with the New South Wales Crime Commission.   Assistant U.S. Attorneys Andrew P. Young, Benjamin Katz and Mark W. Pletcher are prosecuting the case, with assistance from DOJ’s Office of International Affairs.

DEFENDANTS                                Case Number 15-CR-2310-WQH                                       

Owen Hanson                                     Age:    34

Luke Fairfield                                     Age:    40

Kenny Hilinski                                    Age:    39

Giovanni Brandolino                          Age:    42

Daniel Portley-Hanks                         Age:    70

Jack Rissell                                          Age:    50

Derek Loville                                      Age:    48

Chalie D’Agostino                              Age:    52

Marlyn Villareal                                  Age:    32

Dylan Anderson                                  Age:    34

Tim Bryan                                           Age:    48

Jim Muse                                             Age:    53

Jeff Bellandi aka “Jazzy”                    Age:    50

Curtis Chen                                         Age:    33

James Duley                                        Age:    41

Dee Foxx                                            Age:    35

Khalid Petras                                      Age:    55

Rahul Bhagat                                      Age:    31

David Kipper                                      Age:    35

Todd Oldham                                      Age:    32

Daniel Ortega                                     Age:    42

SUMMARY OF CHARGES

Racketeering Conspiracy to Conduct RICO Enterprise Affairs, 18 U.S.C. § 1962(d)

Maximum penalty: 20 years in prison, fine of $250,000 or twice the gross gain or loss caused by the offense, forfeiture of any property obtained or operated by RICO enterprise, 3 years’ supervised release.

AGENCIES

Federal Bureau of Investigation – San Diego Field Office

U.S. Drug Enforcement Agency

Internal Revenue Service – San Diego

Australian Crime Commission

New South Wales Police Force

New South Wales Crime Commission

Assistant U. S. Attorneys Andrew Young (619) 546-7981, Mark W. Pletcher (619) 546-9714 and Benjamin J. Katz (619) 546-9604

NEWS RELEASE SUMMARY – October 2, 2018

SAN DIEGO – Vincent Ramos, the chief executive of Canada-based Phantom Secure, pleaded guilty today to leading a criminal enterprise that facilitated the transnational importation and distribution of narcotics through the sale and service of encrypted communications devices.

In his plea agreement, Ramos admitted that he and his co-conspirators facilitated the distribution of cocaine, heroin, and methamphetamine to locations around the world including in the United States, Australia, Mexico, Canada, Thailand and Europe by supplying narcotics traffickers with Phantom Secure encrypted communications devices designed to thwart law enforcement.  To keep the communications out of the reach of law enforcement, Ramos and others maintained Phantom Secure servers in Panama and Hong Kong, used virtual proxy servers to disguise the physical location of its servers, and remotely deleted or “wiped” devices seized by law enforcement.  Ramos and his co-conspirators required a personal reference from an existing client to obtain a Phantom Secure device. And Ramos used digital currencies, including Bitcoin, to facilitate financial transactions for Phantom Secure to protect users’ anonymity and launder proceeds from Phantom Secure. Ramos admitted that at least 450 kilograms of cocaine were distributed using Phantom Secure devices. 

As part of his guilty plea, Ramos agreed to an $80 million forfeiture money judgment as well as the forfeiture of tens of millions of dollars in identified assets, ranging from bank accounts worldwide, to houses, to a Lamborghini, to cryptocurrency accounts, to gold coins.  In addition, Ramos agreed to forfeit the server licenses and over 150 domains which were being used to operate the infrastructure of the Phantom Secure network, enabling it to send and receive encrypted messages for criminals.

“The Phantom Secure encrypted communication service was designed with one purpose – to provide drug traffickers and other violent criminals with a secure means by which to communicate openly about criminal activity without fear of detection by law enforcement,” said U.S. Attorney Adam Braverman.  “As a result of this investigation, Phantom Secure has been dismantled and its CEO Vincent Ramos now faces a significant prison sentence. The United States will investigate and prosecute anyone who provides support, in any form, to criminal organizations, including those who try to help criminal organizations ‘go dark’ on law enforcement.”

“Today’s guilty plea of Phantom Secure’s CEO, Vincent Ramos, is a significant strike against transnational organized crime,” said John Brown, FBI Special Agent in Charge of the San Diego Field Office.  “The FBI and our international law enforcement partners have demonstrated that we will not be deterred by those who exploit encryption to benefit criminal organizations and assist in evading law enforcement.  With this case, we have successfully shut down the communication network of dangerous criminals who operated across the globe.”

Ramos’s co-defendants - Kim Augustus Rodd, Younes Nasri, Michael Gamboa and Christopher Poquiz – remain international fugitives, charged with participating in and aiding and abetting a racketeering enterprise and conspiring to import and distribute controlled substances around the world.  All have been charged with Conspiracy to Commit Racketeering in violation of 18 U.S.C. § 1962 and Conspiracy to Distribute Controlled Substances in violation of 21 U.S.C.  § 841 and 846.

Ramos is scheduled to be sentenced on December 17, 2018 before U.S. District Judge Sentencing was set for December 17 before Judge Hayes

This case was investigated by FBI San Diego. In addition to our foreign law enforcement partners, the U.S. Attorney’s Office further recognizes the support and assistance of the U.S. Drug Enforcement Administration; Customs and Border Protection; the Department of Homeland Security; Seattle and Las Vegas field offices of the Federal Bureau of Investigation; the Washington State Police Department; the City of Bellingham, Washington Police Department; the City of Blaine, Washington Police Department; and the Canada Border Services Agency, among others, without whose help this prosecution could not have been possible.

This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise of federal, state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking, and money laundering organizations and enterprises.

DEFENDANT                                               Case Number 18CR1404-WQH                                         

Vincent Ramos (1)                                          Richmond, British Columbia, Canada

   aka “CEO”

   aka “Business”

SUMMARY OF CHARGES

Racketeering Conspiracy (RICO Conspiracy), in violation of 18 U.S.C. § 1962(d)

Maximum Penalty: 20 years prison

AGENCIES

Federal Bureau of Investigation

Drug Enforcement Administration

Department of Justice, Office of International Affairs

Australian Federal Police

New South Wales Police (Australia)

New South Wales Crime Commission (Australia)

Australian Criminal Intelligence Commission

Royal Canadian Mounted Police

International Assistance Group, Department of Justice, Canada

Assistant U. S. Attorney Shital Thakkar (619) 546-8785 and Shane Harrigan (619) 546-6981

NEWS RELEASE SUMMARY – September 27, 2018

SAN DIEGO – Tyler Carender was sentenced in federal court today to 10 years in prison for damaging and destroying buildings at St. Andrew’s Episcopal Church and Oak Crest Middle School in Encinitas on three separate occasions in the fall of 2016, by means of fire and an explosive device.

Carender was arrested in July 2017 at his home on Island View Lane in Encinitas, which is adjacent to Oak Crest Middle School and about 400 yards from the church. He pleaded guilty on March 9, 2018 to all three arson-related charges in the indictment.

In his plea agreement, Carender admitted that he began his 21-day arson spree on Saturday, October 22, 2016, when he set fire to the “Friendship House” Counseling and Youth Center building at the Saint Andrew’s Episcopal Church complex on Balour Drive in Encinitas.  The rapid response of the Encinitas Fire Department prevented the fire from spreading to other church buildings and nearby residences.  However, the Youth Center was destroyed, resulting in an estimated monetary loss of at least $200,000.  St. Andrew’s uses the Youth Center building to house its youth group functions and to provide food, meals and shelter to the needy in the community. 

Carender also admitted that a week later, on Saturday, October 29, he set fire to the Administrative Building at the Oak Street Middle School by breaking into the building and using gasoline to set fire to books and files within the building.  Encinitas firefighters who arrived at the scene initially entered the building to fight the fire.  However, due to the extent and intensity of the fire and the possible collapse of the roof, they were forced to retreat from the building and battle the blaze from the exterior.  Carender admitted that his criminal conduct created substantial risk of injury to firefighters responding to the blaze.  The damage caused by Carender’s arson not only rendered the administrative hub of the school unusable, but destroyed student records and displaced staff -- significantly disrupting the daily functions and operations of the school.  The estimated monetary loss to the San Dieguito Union High School District is at least $1.5 million. 

Carender also admitted that two weeks later he returned to the St. Andrew’s campus, and threw a Molotov Cocktail into the office of the church’s Preschool Building, causing another fire.  The resulting damage to the building is estimated to be at least $25,000.  The Preschool services approximately 80 students, and includes non-members of the parish.    

According to court filings, San Diego Sheriff’s detectives received an anonymous tip from Crime Stoppers, which identified Carender as the arsonist.  Thereafter, Carender confided in a classmate about committing the three arsons, and that classmate informed investigators and provided a recording of a conversation with the defendant admitted his involvement in setting the fires.  After the Carender was arrested, he initially lied to agents, claiming innocence. However, after being confronted with evidence, he admitted starting all three fires.

At today’s hearing, the Reverend Brenda Sol, rector at St. Andrews Episcopal Church, addressed Carender and the Court stating that Carender’s actions cost the church a lot more than just money and time – it affected the lives of their church community and nearby neighbors in other more damaging ways.  Members of the church and local residents experienced great emotional distress.  The fires caused them to fear for their safety, placing them on constant alert.  Families also pulled their children out of the Preschool, fearing further attacks.  The fires also caused the church to divert resources from programs to feed the hungry in order to buy a security system. However, Rev. Sol expressed that although the church congregation is sad, they are not angry with Carender.   In addressing Carender directly, Rev. Sol stated,

“We pray that you understand the depth and breadth of the lives you touched in such horrible and negative ways, so that you understand you can touch just as many lives doing helpful and beneficial things . . . We want you to know that when you committed these crimes on our property, you became one of us, so you will always have a home at St. Andrew’s.”

In imposing the ten year sentence, Judge Janis L. Sammartino noted that Carender’s crimes were “horrific” and the damage from his arson spree went “far and wide – far beyond property damage.”  The Court deferred the determination of court ordered restitution until December 7, 2018, but is estimated that the restitution will exceed $1.5 million. 

“It is very clear that all of the victims are still recovering from the emotional, psychological and physical damage caused by the defendant,” said U.S. Attorney Adam Braverman. “While the victims have graciously offered forgiveness, this sentence is an appropriate outcome for serious crimes that put people and property at great risk.”

“Arson is an act we take very seriously,” said Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Los Angeles Field Division Special Agent in Charge Bill McMullan. “ATF uses its certified fire investigators to build these complex cases when arsonists commit these violent crimes. Damaging and attempting to destroy our community schools and places of worship will not be tolerated.”

DEFENDANT                                               Case Number 17cr1588                               

Tyler Carender                                                Age: 22                                   Encinitas, CA

SUMMARY OF CHARGES

Counts 1 and 3:

Malicious Damage to Buildings or Real Property Affecting Interstate Commerce by Means of Fire or an Explosive, in violation of Title 18, United States Code, Section 844 (i)

Count 2:

Malicious Damage to Buildings and Real Property Receiving Federal Financial Assistance by Means of Fire or an Explosive, in violation of Title 18, United States Code, Sec. 844(f )(1) and (f )(2)

AGENCY

U.S. Bureau of Alcohol, Tobacco Firearms and Explosives

San Diego County Sheriff’s Department

 

Assistant U.S. Attorneys Todd Robinson (619) 546-7994 and Kareem Salem (619) 546-8904

NEWS RELEASE SUMMARY – September 20, 2018

SAN DIEGO, CA – Twenty-six people, many of whom are alleged members and associates of criminal street gangs and the Mexican Mafia prison gang, are charged in complaints unsealed today with participating in drug- and gun-related conspiracies, including one that alleges a kidnapping and armed robbery that was prevented by law enforcement.

About 228 firearms were seized from a home in Lakeside during the investigation, and law enforcement officials who were listening in on conversations via court-approved electronic surveillance were able to thwart the attempted kidnapping of a gang member known as “Grizzly from Palm City.”

This morning before dawn, a contingent of more than 200 local, state and federal law enforcement officials searched dozens of locations around the county looking for defendants, guns and drugs. As of 3 p.m. today, 20 defendants are in custody. During searches today and over the course of the yearlong investigation, authorities have seized seven pounds of methamphetamine with an estimated street value of over $150,000. Six federal defendants are still at large, including Marla Caniglia, Christina Tovar, Farren Alcoser, aka “Sweetpea,” Soledad Mota, aka “Negra,” Tony Kiryakoza, and Candice Apra, aka “Babydoll.”  Anyone with information is asked to contact the FBI at 858-320-1800.

According to one complaint charging Robert Thomas Welsh, San Diego Sheriff’s Department’s Special Enforcement Division executed a search warrant at Welsh’s residence on Wildcat Canyon Road in Lakeside. They found multiple gun safes in various locations within the home, a total of 228 firearms including AR-15 assault rifles and guns with obliterated serial numbers, multiple high capacity magazines including a 50-round drum magazine, several firearm silencer devices, a “Glock switch” device that converts a semi-automatic pistol into an automatic pistol and multiple cases of ammunition.

According to another complaint, in June of 2018, agents participating in the investigation learned that defendants Fady Esho, Sergio “Shaggy” Sanchez and Jose “Chapo” Hernandez intended to assault, intimidate, rob at gunpoint and restrain the intended victim on behalf of the Mexican Mafia because they believed he stole  a laptop and other items from a gang associate.

Esho, along with fellow defendants Sergio “Shaggy” Sanchez and Jose “Chapo” Hernandez, set out to do the bidding of the prison gang leaders. However, the San Diego Police Department’s Gang Suppression Team conducted a traffic stop of their Hummer as the three defendants were en route to the “hit.” The trio was arrested and officers seized four firearms and zip ties.

According to the complaint, Esho was carrying a loaded Sig Saur .40-caliber handgun in a concealed holster on his waist, along with two filled magazines in separate holsters. Esho also had multiple zip ties in his rear pants pocket. A search of the Hummer resulted in the seizure of an additional three firearms, all of which were loaded: A Ruger 9mm handgun was located between the front passenger seat and the console; a Smith and Wesson 9mm handgun was located in a black bag in the rear seat; and a Ruger .22-caliber revolver was located under the driver’s floor mat.

In total, the defendants were charged in six complaints with various crimes, including racketeering, methamphetamine trafficking, felon in possession of firearms and other drug and gun offenses. According to the complaints, the gang members come from the following gangs: Otay Rasta Locos, Logan Heights Rep Steps, Encanto, Lomita, Logan Heights 30, Eastside, East County Blood, Lakeside Gangsters, Varrio Chula Vista and Pinoy.

“The seizure of hundreds of firearms is a very significant strike against gang violence in our communities,” said U.S. Attorney Adam Braverman. “Gang members live by a different set of norms, in a world where methamphetamine is a business and guns and violence are tools of the trade. Because of the strong partnerships between state, local and federal law enforcement, this operation is now closed.”

Federal Bureau of Investigation Special Agent in Charge John Brown stated, “Dismantling violent gangs is a continuing priority for the FBI. We share a long commitment with our law enforcement partners to address the dangerous threat facing our communities. Today's takedown demonstrates our focus and determination to strike at gang related enterprises and to eliminate the violence these groups inflict on our neighborhoods.”

The defendants had their initial appearance before United States Magistrate Judge Nita L. Stormes this afternoon. All defendants entered a plea of not guilty to the charges.  Their next court appearance will be on September 25, 2018, for a hearing on the Government’s motion to have the defendants remain in custody pending trial.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

DEFENDANTS                                Case Number: 18mj4902                             

Robert Thomas Welsh                                                                       

SUMMARY OF CHARGES

Title 18, U.S.C. § 922(o)(1) – Unlawful Possession of a Machine Gun

Maximum Penalty is 10 years in custody

Title 18, U.S.C. § 922(k) – Possession of a Firearm with Manufacturer’s Serial Number Removed and Obliterated

Maximum Penalty is 5 years in custody

DEFENDANTS                                Case Number: 18mj4979                                         

Jesus Ramirez aka “Chuy”

Jorge Gonzalez aka “Lonely”

Chans Milstead

Christopher Risdon

Alan Rohrback Jr.

Brian Allen

Victoria Villa

Ricky Felizmena

Farren Alcoser

Soledad Mota aka “Negra”

Candace Apra aka “Babydoll”

SUMMARY OF CHARGES

Conspiracy to Distribute Methamphetamine, in violation of Title 21, U.S.C. Sections 841 (a)(1) and 846

Maximum Penalty, based on alleged drug amounts: Up to life in prison; 10 year mandatory minimum

DEFENDANTS                                Case Number: 18mj4978

Jesus Ramirez aka “Chuy”

Jose Hernandez aka “Chapo”

Fady Escho

Dale Chaney

Keleli Gaylord

Tony Kiryakoza

David Gautreau

Marla Caniglia

Christina Tovar

Sara Beamer

SUMMARY OF CHARGES

Conspiracy to Distribute Methamphetamine, in violation of Title 21, U.S.C. Sections 841 (a)(1) and 846

Maximum Penalty, based on alleged drug amounts: Up to life in prison; 10 year mandatory minimum

DEFENDANTS                                             Case Number: 18mj4977

Fady Esho

Sergio Sanchez

Jose Hernandez

SUMMARY OF CHARGES

Violent Crime in Aid of Racketeering, in violation of Title 18, U.S.C. Section 1959

Maximum Penalty, based on the underlying racketeering crimes: Up to three years in prison

DEFENDANTS                                             Case Number: 14mj4972

Sammy Harold Baugues

SUMMARY OF CHARGES

Felon in Possession of a Firearm, in violation of Title 18, U.S.C. Section 922(g)(1) and 924(a)(2)

Maximum Penalty is 10 years in custody

Possession with Intent to Distribute Methamphetamine, in violation of Title 21, U.S.C. Section 841(a)(1)

Maximum Penalty is 20 years in custody

DEFENDANTS                                             Case Number: 18mj4971

Veronica Ojeda

Aimee Chavira

SUMMARY OF CHARGES

Conspiracy to Distribute Methamphetamine, in violation of Title 21, U.S.C. Sections 841 (a)(1) and 846

Maximum Penalty, based on alleged drug amounts: Up to life in prison; 10 year mandatory minimum

INVESTIGATING AGENCIES

Violent Crimes Gang Task Force

Task Force agencies include:

FBI, ATF, DEA, BOP, USPIS, California Department of Corrections and Rehabilitation, San Diego District Attorney's Office, San Diego Police Department, San Diego Sheriff's Department, National City Police Department, Chula Vista Police Department, La Mesa Police Department, El Cajon Police Department and Federal Bureau of Prisons- Joint Intelligence Sharing Initiative.

*A complaint is not evidence that the defendants committed the crimes charged.  The defendants are presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.

 

 

Assistant U.S. Attorneys Colin McDonald (619) 546-9144 and Jennifer McCullough (619) 546-8773    

NEWS RELEASE SUMMARY – September 18, 2018

SAN DIEGO – Former U.S. Supervisory Border Patrol Agent Martin Rene Duran was sentenced in federal court today to 24 months in custody for unlawfully depriving another of his civil rights under color of law and for firearms offenses.

On August 16, 2018, Duran pleaded guilty to two counts charging him with depriving an individual, R.C., of rights under color of law.  For over two years, Duran unlawfully wielded the power of the United States government to target and harass R.C., an innocent father trying to protect his child from sexual abuse. Duran created multiple entries in U.S. government databases to harass R.C.  Duran falsely accused R.C. of being an arms trafficker; he falsely claimed R.C. was making threats to law enforcement; he falsely claimed R.C. had bribed his way out of child sexual abuse charges in Mexico; he falsely caused law enforcement to detain and interrogate R.C. on several occasions; and he interrogated R.C. himself, threatening to take away R.C.’s legal permanent resident status in the United States.  The false database entries created by Duran resulted in R.C. being detained at the San Ysidro Port of Entry on multiple occasions.

Duran’s targeting of R.C. began just days after R.C. filed allegations of child sexual abuse in Mexico against Duran’s brother-in-law, Raymond Estrada Figueroa (who has since been charged with child sexual abuse offenses in the Southern District of California). When confronted about his actions, Duran lied about his behavior. For instance, Duran denounced any motive for targeting R.C., claiming he had no knowledge about the allegations against Estrada. That was false: among other things, Duran hired Estrada’s attorney for the case, sent the attorney emails about Estrada, and even paid Estrada’s attorney for his services. Duran also claimed his false reports about R.C. were based on information he received from a “confidential source.” But that “confidential source” denied even knowing R.C. 

Separately, on February 2, 2018, Duran was found guilty after a jury trial of seven counts of illegal transportation of firearms and one count of possession of a short-barreled rifle. Duran purchased seven firearms in Arizona in 2011, 2013 and 2014.  Duran made these purchases using an Arizona driver’s license with an address where he never lived and claimed Arizona residency even though he resided in California.  At the time of the execution of a federal search warrant in October 2015, Duran was in possession of multiple firearms that were illegal in California and one short-barreled rifle. 

Today, for his crimes, U.S. District Judge Marilyn L. Huff sentenced Duran to a term of 24 months’ custody on the firearms offenses and a concurrent term of 12 months’ custody on the civil rights offenses. 

“Martin Duran used his significant power as a Border Patrol official against someone he was sworn to protect,” said U.S. Attorney Adam Braverman. “He targeted a law-abiding citizen because of a personal vendetta, and for that he will go to prison.”

“Former Supervisory Border Patrol Agent Martin Duran selfishly tarnished the reputation and badge worn proudly by so many hard working and upstanding members of the law enforcement community,” said Jeffrey J. Gilgallon, Special Agent in Charge, ICE Office of Professional Responsibility. “He shamelessly turned his back on the citizens of the U.S. and used the powers of his office to serve his own personal needs. We are grateful to have the cooperation and support of our DHS federal partners in investigating officials who abuse the public trust.”

“It is ATF’s duty and obligation to conduct criminal investigations whenever presented with credible evidence of violations of federal firearms laws,” said ATF Los Angeles Field Division (LAFD) Special Agent in Charge Bill McMullan. “Duran, a law enforcement officer, introduced firearms into the criminal element instead of taking them away from the criminal element. Through his actions, public safety was jeopardized. ATF’s mission is to focus our efforts on firearms traffickers and trigger pullers and we will continue to pursue individuals engaged in this type of illegal activity.”

DEFENDANT                                  

Martin Rene Duran                             Age: 49                       Chula Vista, CA        

SUMMARY OF CHARGES

Case Number: 15CR2818

Deprivation of Rights Under Color of Law, in violation of Title 18, U.S.C., Sec. 242

Maximum Penalties: 12 months’ custody, a fine of $100,000, one year of supervised release.

Case Number: 15CR2817

Title 18, United States Code, Section 922(a)(3) – Illegal Transportation of Firearms

Maximum Penalties: 5 years’ incarceration, a fine of $250,000, three years of supervised release.

Title 26, United States Code, Sections 5861 and 5871 – Possession of Unregistered Firearm: Maximum Penalties: 10 years’ incarceration, a fine of $250,000, three years of supervised release.

AGENCIES

Bureau of Alcohol, Tobacco, Firearms and Explosives

Immigration and Customs Enforcement – Office of Professional Responsibility

Department of Homeland Security – Office of Inspector General

U.S. Customs and Border Protection - Office of Professional Responsibility

Special Assistant U.S. Attorneys Jeffrey D. Hill (619) 546-7924 or Lisa J. Sanniti (619) 546-8811

NEWS RELEASE SUMMARY – September 17, 2018

SAN DIEGO – Andre Lorenzo Jackson, aka “Andre The Player Jackson,” was indicted by a federal grand jury on charges of stealing almost $100,000 in Social Security disability benefits by concealing his residency in Germany for almost a decade.  An arrest warrant has been issued for Jackson, who authorities believe is still living in Germany.

In order to be eligible to receive Supplemental Security Income – a program designed to provide a floor of income for the aged, blind or disabled who have little or no income or resources – an individual must reside within the United States of America.  As alleged in the ten-count indictment returned last week, Jackson started defrauding the Social Security Administration (SSA) in February 2005 by falsely claiming to reside in San Diego, California, and concealing his extensive foreign travel, in order to continue collecting Supplemental Security Income he started receiving in 1986.  While collecting monthly Supplemental Security Income payments, Jackson traveled abroad extensively and promoted himself through social media as a professional athlete, entertainer, and musician.

According to the indictment, Jackson fraudulently represented to the SSA on numerous occasions that he continued to be eligible to receive these benefits.  During the decade he fraudulently received benefits into a United States bank account, Jackson would withdraw the funds using ATMs or debit card transactions to pay for his personal expenses.

“Jackson is accused of stealing tens of thousands of dollars intended to help our country’s most vulnerable,” said United States Attorney Adam L. Braverman.  “Individuals who abuse the trust and generosity of federal programs will be brought to account.”

“Supplemental Security Income provides a lifeline for the elderly and disabled located within the United States.  Because foreign residency fraud takes resources from this vital program and steals directly from the American taxpayer, the Social Security Administration’s Office of the Inspector General vigorously investigates allegations of residency fraud.  My office is pleased to see charges brought in this case, and grateful that the U.S. Attorney’s Office shares our determination to protect the integrity of this vital income security program,” said Robb Stickley, Special Agent in Charge of the Inspector General’s Office of Investigations in San Francisco.

This case was investigated by the San Diego division of the Social Security Administration, Office of the Inspector General, and is being prosecuted by Special Assistant United States Attorneys Jeffrey Hill and Lisa Sanniti, both of the Social Security Administration’s Office of General Counsel. 

DEFENDANT                       Case Number 18-cr-4055

Andre Lorenzo Jackson          Age: 58           Billigheim, Germany

SUMMARY OF CHARGES

Wire Fraud – Title 18, U.S.C. Section 1343

Maximum penalties: 20 years’ custody; 3 years’ supervised release; $250,000 fine; restitution; forfeiture.

Theft of Public Property – Title 18, U.S.C., Section 641

Maximum penalties: 10 years’ custody; 3 years’ supervised release; $250,000 fine; restitution; forfeiture.

Investigating Agency

Social Security Administration, Office of the Inspector General

*The charges and allegations in an indictment or complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.

Assistant U.S. Attorney Nicholas W. Pilchak and Andrew J. Galvin (619) 546-9709 and (619) 546-9721

NEWS RELEASE SUMMARY – September 17, 2018

SAN DIEGO – A father and son who fraudulently won over $4 million of federal contracts using false financial statements and other lies were sentenced to prison today and ordered to pay over $1 million in restitution.  The father also admitted to stealing more than half a million dollars from his consulting clients, and then using some of the laundered money to close escrow on a Rancho Santa Fe mansion. 

U.S. District Judge Roger T. Benitez sentenced Joseph Glenn Osborne, Sr., 68, to 57 months in prison for wire fraud and participating in a wire fraud conspiracy with his son and codefendant, Joseph Glenn Osborne, II, 31.  Osborne, II was sentenced to 12 months for falsely making a writing to obtain money from the United States.

In handing down the sentence, Judge Benitez told the father it appeared he’d “made a life out of lying and cheating.”

In his plea agreement, Osborne, Sr. admitted that he stole $588,489 from three different small businesses that had hired him as a consultant for securing federal contracts.  According to court documents and his own admissions, Osborne, Sr. promised to help the victims get contracts with the U.S. Department of Agriculture (USDA).  Osborne, Sr. then misused his position as their agent to change banking information in an online government system, so when USDA paid on his clients’ contracts, Osborne, Sr. diverted the funds to his own accounts. 

According to his plea agreement, Osborne, Sr. laundered some of the stolen money and used it to make a down payment on a $2.7 million mansion in Rancho Santa Fe, California.  Osborne, Sr. then forged a pair of emails to conceal the source of the money by falsely claiming that it was an early retirement withdrawal from his government benefits account.  In fact, according to court filings, Osborne, Sr. had no such account; the agency he impersonated did not actually exist; and he had simply altered an email from a real government employee. 

In 2013, after Osborne, Sr.’s clients terminated him, the Osbornes agreed to submit fraudulent financial statements to qualify Osborne, II’s new business—Worldwide Connect LLC (WWC)—as an approved USDA contractor.  As set out in their guilty pleas, the Osbornes recruited Osborne, II’s friend and bookkeeper to prepare false financial statements that substantially overstated WWC’s financial health.  For example, the statements fraudulently converted WWC’s 2013 year-end cash position from a $5,546 shortfall to a $37,954 surplus. 

The Osbornes also falsely certified that none of WWC’s principals was suspended or debarred from federal contracting.  In fact, according to documents filed in the case, Osborne, Sr. was suspended and debarred from all federal contracting from November 2013 to October 2016, due to conduct at his prior business, Global Health & Safety.  

As a result of its fraud, WWC was approved for federal contracting and won over $4 million of USDA food supply contracts.  Four of the five contracts were terminated for contractor default, however, after WWC failed to deliver over 100,000 cases of fruit juice and raisins to community food banks and lunch programs.  The Osbornes admitted that WWC caused its suppliers and financing company over $1.5 million in losses.  Meanwhile, as set out in the plea agreements and court filings, the Osbornes paid themselves approximately $285,245 of WWC funds in little more than a year.  They also used other company money for personal expenses—including almost $10,000 of nightclub charges and luxury hotel stays, and thousands more for escrow and renovating expenses for Osborne, Sr.’s new personal residence. 

After their contracts were terminated, the Osbornes applied to the Small Business Administration (SBA) to be readmitted to federal contracting.  As part of that application, Osborne, II misstated Osborne, Sr.’s military history, falsely claiming his father was a retired colonel in the Marine Corps.  Osborne, II also supplied a variety of falsified tax returns to the SBA for himself and WWC, including an altered tax return that converted his real $14,870 tax liability into a fake $5,427 tax overpayment.

In addition to their prison terms, each defendant was ordered to pay restitution to their victims in the amounts of approximately $1.7 million for Osborne, Sr. and $1.5 million for Osborne, II.    

“Government contracting depends upon the basic integrity and honesty of the people who seek to do business with the United States,” said U.S. Attorney Adam L. Braverman. “We will investigate and prosecute white collar criminals who think that they can manipulate the contracting system and enrich themselves through lies and deception.” 

FBI Special Agent in Charge John Brown said, “The FBI and our partner at USDA-OIG uncovered repeated deceit, theft and fraud by the Osbornes. Today, the personal greed and self-promotion ended with a federal sentence of custodial time and $1.7 million ordered in restitution to the victims.  The American taxpayers and their government funded programs deserve the dogged pursuit of justice exemplified by this case.”

Special Agent-in-Charge Lori Chan, United States Department of Agriculture (USDA), Office of Inspector General (OIG), Western Region, stated, “The USDA OIG has the responsibility for protecting the integrity of the Agriculture Marketing Service, Commodity Procurement Program.  OIG conducts investigations in each region of the U.S. to deter and uncover criminal activity that undermines the Commodity Procurement Program.  Contractors who engage in financial fraud exploit the public’s trust.  The OIG at USDA works to ensure the integrity of USDA programs.”

This case was investigated by the U.S. Department of Agriculture, Office of Inspector General, and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Nicholas W. Pilchak and Andrew J. Galvin.

DEFENDANT                                                                   Case Number 16CR2546-BEN                  

Joseph Glenn Osborne, Sr.                       Age: 68                                               Carlsbad, California

Joseph Glenn Osborne, II                         Age: 31                                               Carlsbad, California                 

SUMMARY OF CHARGES

Osborne, Sr.:   Wire Fraud, in violation of Title 18 U.S.C. § 1343; term of custody including 20 years in prison, $250,000 fine, 3 years of supervised release, and mandatory restitution. 

Osborne, Sr.:   Wire Fraud Conspiracy, in violation of Title 18 U.S.C. § 1349; term of custody including 20 years in prison, $250,000 fine, and 3 years of supervised release, and mandatory restitution. 

Osborne, II:     Falsely Making a Writing to Obtain Money From the United States, in violation of Title 18 U.S.C. § 495; term of custody including 10 years in prison, $250,000 fine, 3 years of supervised release, and mandatory restitution. 

AGENCIES

U.S. Department of Agriculture, Office of Inspector General

Federal Bureau of Investigation

Assistant U. S. Attorney Orlando B. Gutierrez (619) 546-6958    

NEWS RELEASE SUMMARY – September 14, 2018

SAN DIEGO – Jose Atalo Felix-Beltran, Arturo Felix-Beltran (U.S. citizens), and Osvaldo Felix-Beltran (U.S. resident) living in Indio, California, were arraigned in federal court today on charges that they conspired to distribute over 20,000 tablets of fentanyl. These three defendants are brothers who were arrested together on September 13, 2018, in El Centro, California,

According to a federal criminal complaint, these three brothers drove together to a restaurant located in El Centro, California, where they intended to sell 20,000 tablets of fentanyl to a purchaser who, unbeknownst to them, was an undercover Special Agent with the Drug Enforcement Administration.  Two of the brothers attempted to flee the scene, but were apprehended following a brief foot chase. The third brother was not able to flee and, following a brief period of forcible resistance, was ultimately taken into custody. 

This arrest followed a series of prior transactions where the brothers, together and at times alone, sold undercover DEA agents additional tablets of fentanyl.

At the brothers’ initial appearance in El Centro today before U.S. Magistrate Judge Ruth Bermudez Montenegro, the United States requested detention based on risk of flight. Judge Bermudez Montenegro scheduled a detention hearing for September 21, 2018 at 1:30 p.m. and a preliminary hearing for September 27, 2018 at 1:30 PM.

The fentanyl tablets that were to be sold to undercover agents on September 13, 2018 (depicted below), were tablets of fentanyl manufactured to look like 30mg tablets of oxycodone. The combined weight of the tablets seized from the three brothers on September 13, 2018, was approximately 2.23 kilograms of fentanyl (Schedule II).  The retail street value of these fentanyl tablets is estimated to be $600,000.  

“This is a significant seizure and I’m very happy that thousands of deadly pills will not make it to the streets,” said U.S. Attorney Adam Braverman. “But we are seizing fentanyl at an alarming rate. Despite our relentless efforts to interdict this dangerous drug and educate the community, people are still risking their lives. The next pill you take could very well be your last. Don’t do it.”

“We are at a cross road - We can either continue to let the drug cartels destroy American lives with deadly pills or we can commit to raising the intensity of our war against foreign criminals who profit from destroying American lives,” said DEA Special Agent in Charge Karen Flowers.  “Drugs are deadly and fentanyl has changed the game.  We are no longer dependent on the coca or the poppy plant.  We can create chemicals to mimic whatever affect we desire.  Our drugs are not Non-GMO certified.  They are all engineered in a laboratory.  They are cheap, easy to get and manufacture.  That line of coke, no longer is just cocaine.  That hit of smack is hyped up with fentanyl.  Crystal is not in your dining room, it is in your arm.  They are all potentially laced with a profit-induced additive called fentanyl.  No one is strong enough to win that battle.  It wins, you die.”  

DEFENDANTS                                            Case Number 18MJ10424                           

Jose Atalo Felix-Beltran,                    Age: 27                                   Indio, CA

Arturo Felix-Beltran                           Age: 30                                   Indio, CA

Osvaldo Felix-Beltran                         Age: 19                                   Indio, CA

SUMMARY OF CHARGES

Conspiracy to Distribute Controlled Substances (Felony) – Title 21 U.S.C. § 841 and 846

Maximum penalty: Life imprisonment and $10,000,000.00 fine.

AGENCIES

Drug Enforcement Administration; (Imperial County and Riverside);

Imperial County Sheriff’s Office;

United States Border Patrol;

Imperial County Probation Department;

El Centro Police Department;

United States Customs and Border Protection;

Homeland Security Investigations;

Drug Enforcement Administration - San Diego Air-wing; and

United States Attorney’s Office

Imperial County District Attorney’s Office

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (“OCDETF”), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

 

Assistant U. S. Attorney Michael Wheat (619) 546-8437    

SAN DIEGO – Marisol Chavez-Morales was arrested and charged this week with methamphetamine trafficking in connection with the seizure of 156 pounds, one of the largest in recent history in the Southern District of California.

According to a complaint, a confidential source for the Drug Enforcement Administration identified the defendant as a methamphetamine trafficker who had “offered to sell large amounts of methamphetamine and heroin” to the source. At the direction of the agent, the source negotiated with Chavez, who agreed to provide 130 kilograms of meth, 6 kilograms of black tar heroin and 11 kilograms of “China White” heroin for $775,000. They agreed to meet at a San Diego restaurant on September 7, 2018, to exchange the drugs for money.

According to the complaint, DEA agents established surveillance at the restaurant and observed a silver Chevrolet Cruze enter in the parking lot and park next to the source’s vehicle. The driver of the Chevrolet Cruze was later identified as Chavez. Agents approached the vehicle and Chavez and discovered approximately 71.5 kilograms of methamphetamine in the trunk and the back seat.  The methamphetamine was separated into different packaging and concealed within both a large tire located in the back seat and a large suitcase and small bag located in the trunk.  Additionally, agents found multiple vacuum-sealed brick packages containing suspected heroin contained within several boxes located in the back seat of the Chevrolet Cruze. Chavez was arrested.

During a hearing yesterday, the defendant declined to seek bond. The next court date is scheduled for September 25.

Methamphetamine seized in Chavez’s car on Sept. 7.

DEFENDANTS                                            Case Number 18MJ04833                                       

Marisol Chavez-Morales                                 Age: 34                               Highland , CA

SUMMARY OF CHARGES

Possession with Intent to Distribute Methamphetamine – Title 21, U.S.C., Section 841(a)(1)

Maximum penalty: Mandatory minimum 10 years, up to life imprisonment and $10 million fine.

AGENCY

U.S. Drug Enforcement Administration

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

 

NEWS RELEASE SUMMARY – September 7, 2018

SAN DIEGO – Lahkwinder Singh was sentenced in federal court today to 36 months in federal prison and a forfeiture of $1,955,521 to the United States for structuring approximately $2,955,521 in currency transactions with domestic financial institutions. The 36-month sentence is one of the longest imposed in the Southern District of California for a structuring conviction. Singh’s closely held corporation, Lovely Singh, Inc., was ordered to forfeit $1,000,000, and serve a 5-year term of probation.

Singh and Lovely Singh, Inc., owned and operated Postal Annex franchises in Lemon Grove, California. Singh also acted as the Chief Financial Officer of Lovely Singh, Inc.  In 2006, Singh began operating the Postal Annexes as an agent of Western Union, which required that he operate under a federal license as a money transmitting business, and required that the Postal Annexes maintain a comprehensive Bank Secrecy Act/Anti-Money Laundering (“BSA/AML”) program to ensure that the Postal Annexes were vigilant in preventing unlawful funds from passing through Western Union, and the financial system at large. Singh was the designated BSA/AML Officer responsible for ensuring the Postal Annexes complied with all US financial and banking laws.

Instead of protecting the financial system, by no later than 2011, Singh engaged in a multi-year pattern of cash transactions below the $10,000 threshold to avoid detection by banks and law enforcement, with the intent to deposit Lovely Singh, Inc.’s cash proceeds free from scrutiny.

As Singh and Lovely Singh, Inc. admitted in each of their plea agreements, Singh and his co-defendant distributed Schedule II controlled substances from the Postal Annexes to persons located throughout the United States. Couriers smuggled controlled substances into the United States from Mexico, and delivered them to the Postal Annexes. Over the course of 2011 through 2016 Singh admitted that he was aware of a high probability that hundreds of packages sent from the Postal Annexes contained a prohibited controlled substance, and he deliberately avoided learning the truth of their contents.

As he further admitted in his plea agreement, Singh structured and attempted to structure $2,955,521 of currency transactions over the course of 469 cash deposits at several domestic financial institutions such as Bank of America, N.A. and Wells Fargo Bank, N.A. Singh conducted multiple deposits of less than $10,000 in cash on the same day, and over the course of several business days, into at least 19 different bank accounts with the purpose of avoiding a Currency Transaction Report, which is the report a financial institution must file for cash deposits exceeding $10,000 during any banking day.

The structured cash deposits included cash received in return for shipping the controlled substances from the Postal Annexes stores, as well as Western Union money transfer funds.

At sentencing, Judge Bashant stated that, with his millions of dollars in structured deposits, Singh “knew exactly what he was doing” – namely “avoiding detection from the government … for shipping drugs” out of the Postal Annex. The sentence imposed, as Judge Bashant stated, serves as a “very important deterrent” to third-party money launderers who are the gateway to the financial system, who like Singh, are engaged in playing a “shell game” of transactions.

This case was a joint investigation with IRS-Criminal Investigation, HSI, DEA, U.S. Postal Inspection Service and California DOJ.

“The U.S. mail is not a delivery service for drug traffickers, and our banking system is not meant to launder millions of dollars of drug money,” said U.S. Attorney Adam Braverman. “Together with our law enforcement partners we have put a stop to this brazen scheme and kept our institutions from being exploited by criminals.”

Postal Inspector in Charge Nichole Cooper stated, “Postal Inspectors and our law enforcement partners will vigorously investigate, arrest, and prosecute anyone who willfully allows the introduction of a controlled substance into the U.S. Mail.  Today’s sentencing sends a strong message to drug traffickers that Postal Inspectors stand ready to protect the sanctity of the mail.”

“In this investigation, HSI and our law enforcement partners uncovered a sophisticated financial scheme aimed at providing cover for cash transactions that were tied to the illicit distribution of controlled substances in cities throughout the United States,” said Dave Shaw, HSI Special Agent in Charge in San Diego. “HSI continues to remind the community of the serious public health threat, as well as warn individuals who put consumers at risk for their own financial gain.  We are committed to working closely with all of our law enforcement partners, both domestic and abroad, to prevent counterfeit drugs from being smuggled into the U.S. and distributed illegally over the internet.”

“Lahkwinder Singh thought he had the perfect scam going when he started using his postal annex to hide money earned by drug traffickers from the IRS," said Special Agent in Charge R. Damon Rowe, IRS Criminal Investigation Los Angeles Field Office. "Thanks to the hard work of IRS CI special agents and their law enforcement partners, Singh is now paying the price for his scheme and drug traffickers have lost another venue to launder their ill-gotten gains.”

“Mr. Singh utilized a legitimate mail delivery business to distribute prescription drugs, including fentanyl and Oxycontin, throughout the United States in order to avoid detection by law enforcement,” said DEA Special Agent in Charge Karen Flowers. “Mr. Singh’s actions directly contributed to the devastation of our American communities caused by the opioid epidemic.  DEA will continue to investigate those seeking to profit from the illegal distribution of drugs and destruction of our communities.”

“Trafficking pharmaceutical drugs and illegally selling them without a prescription is dangerous and will not be tolerated,” said Attorney General Becerra. “Let this sentence send a message: if you attempt to unlawfully manipulate our financial system and fuel prescription drug abuse for a quick buck, federal and state law enforcement will hold you accountable."

DEFENDANTS                                                    Case Number 16cr729-BAS

Lahkwinder Singh                                                Age: 59                              Scripps Ranch, CA

Lovely Singh, Inc.                                                California Corporation

SUMMARY OF CHARGES

Structuring Currency Transactions with One or More Financial Institutions – Title 31, U.S.C., Sections 5324(a)(3), (d)(2).

Maximum penalty for Singh: Ten years in prison, $500,000 fine, forfeiture of all property, real or personal, involved in the offense and any property traceable thereto, and a term of supervised release of up to three years.

Maximum penalty for Lovely Singh, Inc.: $1 million fine, forfeiture of all property, real or personal, involved in the offense and any property traceable thereto, and a term of probation of up to five years.

AGENCIES

Internal Revenue Service

Homeland Security Investigations

Drug Enforcement Administration

U.S. Postal Inspection Service

California Department of Justice

Assistant U.S. Attorneys Kyle B. Martin and Matthew J. Sutton (619) 546-7726 and (619) 546-8941

NEWS RELEASE SUMMARY – September 5, 2018

SAN DIEGO – Two defendants, Gregory Amos and Christopher Hernandez, were charged this week in connection with a March 2018 explosion and fire resulting from their operation of a butane hash oil lab in a residential Vista neighborhood. Amos and Hernandez are scheduled to be arraigned before U.S. Magistrate Judge Jan M. Adler on Friday, September 7 at 2:00 p.m.

According to the complaint, in the morning hours of March 27, 2018, an explosion and fire on the balcony of a residence located on Barbara Drive in Vista shattered the glass door of the balcony and blasted dozens of cans of butane into the surrounding area. In the wake of the explosion, investigators discovered an active Butane Hash Oil (BHO) lab in the residence where the fire originated. After extinguishing the fire and securing the scene, investigators located a number of items related to a BHO manufacturing laboratory, including kilograms of marijuana, hundreds of cans of butane, glass tubes and other manufacturing items. Agents also seized approximately one pound of cocaine and three firearms including a Del-Ton DT-15 5.56 mm rifle and a Smith and Wesson 9 mm semi-auto pistol.

BHO labs are highly dangerous facilities used to extract tetrahydrocannabinol (THC), a Schedule I controlled substance found in marijuana plants, through the use of butane. The manufacture of BHO is a violation of federal law, Title 21, U.S. Code, Section 841. The manufacture of BHO is also a violation of California state law, Health and Safety Code, Section 11379.6. Since January 2018, law enforcement has responded to at least 17 illicit BHO labs in San Diego County (three of which had fires and or explosions).

BHO is similar in appearance to honey or butter. It contains extremely high levels of THC and can be up to four times more potent than high-grade marijuana. BHO is commonly manufactured by packing marijuana into a glass, plastic, or metal tube. Butane is then sprayed into the top of the tube. The butane strips the marijuana of its cannabinoid-containing oils, which drip from the bottom of the tube, often through a filter and into a holding container. The end product is highly-profitable and can be ingested as an oil, consumed in edibles, or solidified to make concentrated forms of cannabis known as “wax.”

During the manufacture of BHO, butane, a flammable gas that is odorless, colorless, and heavier than air, can evaporate out of the substance and collect on the floor, accumulating to explosive levels without proper ventilation. This process creates an invisible, but very real, risk of fires, explosions, and chemical burns.

“BHO manufacturing poses an enormous threat to human life,” said U.S. Attorney Adam L. Braverman. “No one is safe: not those involved in the illegal BHO manufacturing themselves; not those who happen to be living or visiting nearby; not first responders. Together with our law enforcement partners, we will aggressively prosecute all who threaten public safety by manufacturing these deadly substances.” 

“Drugs are dangerous.  End of story.  Nothing would have exploded if someone did not want to dab high potency THC,” said Special Agent in Charge Karen Flowers.  “You have a choice.  Your choice has a consequence.  Those consequences apply to those around you.  Just ask their neighbors.”

This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

The government’s case is being prosecuted by Assistant U.S. Attorneys Kyle B. Martin and Matthew J. Sutton.

DEFENDANTS                                                               Case Number: 18MJ4780-JMA

Gregory Allen Amos,                                  Age: 23                                  Vista, California

Christopher Paul Hernandez                  Age: 34                                  San Diego, California

SUMMARY OF CHARGES

Conspiracy to Distribute Hashish Oil - 21 U.S.C. §§ 841(a)(1) and 846

Maximum penalty: 5 years’ imprisonment and $250,000 fine

Endangering Human Life While Illegally Manufacturing Hashish Oil - 21 U.S.C. § 858

Maximum penalty: 10 years’ imprisonment and $250,000 fine

Possession of Cocaine with Intent to Distribute - 21, U.S.C., § 841(a)(1);

Maximum penalty: 20 years’ imprisonment and $1,000,000 fine

Possession of Firearm in Furtherance of Drug Trafficking Crime -18 U.S.C. § 924(c)

Mandatory 5 years’ imprisonment consecutive to drug trafficking sentence

AGENCIES

Drug Enforcement Administration

San Diego Sheriff’s Department

San Diego Police Department

Vista Fire Department

Department of Justice, Organized Crime Drug Enforcement Task Forces

*An indictment or complaint is not evidence that the defendants committed the crimes charged. The defendants are presumed innocent until the Government meets its burden in court of proving guilt beyond a reasonable doubt.

Special Assistant U.S. Attorney Jeffrey D. Hill (619) 546-7924 and Assistant U.S. Attorney Matthew C. Brehm (619) 546-7951

NEWS RELEASE SUMMARY – September 5, 2018

SAN DIEGO – Michael Vanden Brink pleaded guilty today to stealing thousands of dollars in benefits intended for the widow of a military veteran.  During his plea before U.S. Magistrate Judge Jan M. Adler this morning, Brink admitted that after the widow’s death in 2004, he converted her benefits paid out by the Department of Veteran’s Affairs to his own use.

Brink, 57, acknowledged that H.C.C., the spouse of a deceased veteran, began to receive Dependency and Indemnity Compensation benefits in 1972.  Sometime prior to March 2004, H.C.C. began to receive those benefits via direct deposit into a bank account in both her name and Brink’s.

Brink acknowledged that H.C.C. died on June 30, 2004, at her home in Oceanside, California, and that he was aware of her death and that her benefits should have ceased immediately upon her death.  Brink further acknowledged that he knew that he was not entitled to H.C.C.’s benefits, and that he knew that the money rightfully belonged to the United States.

As a part of his plea, Brink admitted that he received a monthly bank statement for the account, and that he never informed the bank that H.C.C.’s monthly benefits should cease.  Instead, Brink admitted that from July 1, 2004 until February 26, 2014, only he had access to and control of all funds in the bank account, and that during that time he converted a total of $145,035 in United States’ money to his own use.

 “For almost a decade, this defendant stole thousands of dollars intended to help the families of our brave men and women in uniform,” said United States Attorney Adam L. Braverman.  “This prosecution demonstrates the commitment of the United States Attorney’s Office to protecting the integrity of programs for our veterans and their families.”

“This investigation demonstrates the OIG’s commitment to aggressively pursue individuals who defraud VA programs.  The VA OIG will continue to identify criminal activity in order to protect the integrity of VA programs.” said Special Agent in Charge A.E. Pleasant, U.S. Department of Veterans Affairs, Office of Inspector General, Criminal Investigations Division, Western Field Office.

As a part of his plea agreement, Brink agreed to pay $145,035 in restitution to the Department of Veteran’s Affairs.  Brink faces up to 10 years in federal prison and a fine of up to $390,060 at his sentencing hearing before U.S. District Judge John A. Houston on December 10, 2018. 

DEFENDANT                       Case Number 18-cr-3894       

Michael Vanden Brink           Oceanside, CA.

SUMMARY OF CHARGES

Theft of Public Property – Title 18, U.S.C., Section 641

Maximum penalty: 10 years’ imprisonment, $390,060 fine, restitution

AGENCIES

U.S. Department of Veteran’s Affairs, Office of Inspector General – Criminal Investigations Division

NEWS RELEASE SUMMARY – August 31, 2018

SAN DIEGO – Two gang members of the Westside Crips pleaded guilty today for their participation in a racketeering conspiracy involving sex trafficking, narcotics trafficking, and other violent crimes as well as possession of a controlled substance with the intent to distribute.    

Corey DeShawn Austin (aka “Westwood”) and Travion McHenry (aka “Too Much”) admitted their respective membership and association with the Westside Crips, who primarily operated in Oceanside and elsewhere.  Sentencing for Austin is scheduled for December 14, 2018.  McHenry is scheduled to be sentenced on October 19, 2018.

In furtherance of the RICO conspiracy, Austin, the lead defendant, admitted he engaged in promoting prostitution of adult females between 2013 and 2015, including while he was in state custody for another offense.  Austin further admitted he possessed narcotics for sale in 2013 with co-defendant McHenry and posted photos of himself throwing up gang signs and wearing gang colors showing his allegiance to Westside Crips on social media between 2013-2016. 

To further his role in the RICO conspiracy, McHenry admitted he committed a 2012 home invasion robbery with two other coconspirators during which the victims were robbed at gunpoint.  He also admitted he possessed narcotics for sale in 2013 with co-defendant Austin and posted photos of himself throwing up gang signs and wearing gang colors showing his allegiance to Westside Crips on social media between 2012-2014.   

“Gang members, their associates and those who assist them will not be permitted to exploit members of our community for their own personal gain and notoriety by promoting sex trafficking, narcotics trafficking, and violent crime,” said U.S. Attorney Adam L. Braverman.

“One of the top priorities for the DEA in San Diego is dismantling violent street gangs that profit by selling drugs in our community.  The profit, cold hard cash, in turn fuels the violence on our streets,” said Special Agent in Charge Karen Flowers.  “DEA will continue to target and put away violent street gang members like Mr. Austin and Mr. McHenry because it makes San Diego County a safer place to live.”

“For over a decade, this sophisticated street gang terrorized the streets of Oceanside and the surrounding areas for profit,” said IRS Criminal Investigation’s Special Agent in Charge R. Damon Rowe.  “Our agency plays a unique role in federal law enforcement’s resolve to dismantle criminal gang enterprises. Our agents target the profit and financial gains of these violent organizations, following the money in an effort to disrupt these organizations and bring their members to justice.”

“The Oceanside Police Department would like to thank the US Attorney's Office and other law enforcement agencies for their collaboration and hard work during this operation.  “It is collective efforts like this that highlight why the San Diego region is a model for other law enforcement agencies to emulate, to keep their communities safe,” said Oceanside Police Chief Frank McCoy.

The remaining defendant, William Bright, is set for a motion hearing on October 1, 2018. The other defendants have pleaded guilty and many have been sentenced for their participation in the RICO conspiracy.

This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

DEFENDANTS                                              Case Number 17cr0270-JAH                                              

Corey DeShawn Austin aka “Westwood”                  Age: 38                       Oceanside, CA

Travion McHenry aka “Too Much”                           Age: 26                       Oceanside, CA

SUMMARY OF CHARGES

Title 18, United States Code, Section 1962(d) - Conspiracy to Conduct Enterprise Affairs Through a Pattern of Racketeering Activity; Title 18, United States Code, Section 1963 - Criminal Forfeiture Maximum Penalties: 20 years’ incarceration, a fine of $250,000, three years of supervised release

AGENCIES

North County Narcotics Task Force

Drug Enforcement Administration

Oceanside Police Department

Internal Revenue Service

NEWS RELEASE SUMMARY – August 31, 2018

SAN DIEGO – Today, United States District Court Judge Gonzalo P. Curiel sentenced Edwin Fuller to 100 months in custody following a November 2017 jury trial where he was convicted of conspiring to possess with the intent to distribute oxycodone, in violation of Title 21, U.S.C., Section 841(a)(1) and 846.

Fuller used fraudulent medical prescriptions to acquire approximately 20,520 tablets of oxycodone for the purpose of distribution. In handing down today’s sentence, Judge Curiel stated oxycodone is a very dangerous drug and defendant was responsible for acquiring and distributing large amounts of tablets.

DEFENDANTS                                              Case Number 16cr0867-GPC                                             

Edwin Fuller                                                   Age: 39                                   Los Angeles, CA

SUMMARY OF CHARGES

Conspiracy to possess controlled substances with the intent to distribute – Title 21, U.S.C., Section 841(a)(1) and 846

Maximum penalty: 20 years imprisonment

AGENCY

Drug Enforcement Administration

This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

 

 

Kelly Thornton, Director of Media Relations (619) 546-9726

NEWS RELEASE SUMMARY – August 21, 2018

SAN DIEGO – U.S. Rep. Duncan D. Hunter and his wife, Margaret E. Hunter, were indicted by a federal grand jury today on charges that they converted more than $250,000 in campaign funds to pay for personal expenses and filed false campaign finance records with the Federal Election Commission.   

A 48-page indictment details scores of instances beginning in 2009 and continuing through 2016 in which the Hunters illegally used campaign money to pay for personal expenses that they could not otherwise afford.  The purchases included family vacations to Italy, Hawaii, Phoenix, Arizona, and Boise, Idaho; school tuition; dental work; theater tickets; and domestic and international travel for almost a dozen relatives. The Hunters also spent tens of thousands of dollars on smaller purchases, including fast food, movie tickets, golf outings, video games, coffee, groceries, home utilities, and expensive meals.

To conceal their personal spending, the Hunters mischaracterized the purchases in FEC filings as “campaign travel,” “dinner with volunteers/contributors,” “toy drives,” “teacher/parent and supporter events,” “gift cards” for charitable donations, and “gift basket items,” among other false descriptions.  Family dental bills paid with campaign funds were characterized as a charitable contribution to “Smiles for Life.” Theater tickets were mischaracterized as “holiday gift certificates.”  Tickets for the family to see Riverdance at the San Diego Civic Theater became “San Diego Civic Center for Republican Women Federated/Fundraising.”  And to disguise their children’s tuition payments to Christian Unified Schools in El Cajon, the Hunters provided a number of conflicting explanations, including that the payments were charitable contributions. 

The Hunters’ improper use of campaign funds for personal expenses occurred despite numerous warnings about the prohibition against using campaign funds for personal expenses and repeated inquiries from Duncan Hunter’s campaign treasurer about questionable purchases. According to the indictment, the Hunters knew that many of their desired purchases could be made only by using campaign funds, since they did not otherwise have sufficient personal funds to pay for their purchases.  The criminal investigation began in June of 2016, two months after the Federal Election Commission and the San Diego Union-Tribune questioned some of Hunter’s campaign expenses as potentially personal.

“The indictment alleges that Congressman Hunter and his wife repeatedly dipped into campaign coffers as if they were personal bank accounts, and falsified FEC campaign finance reports to cover their tracks,” said U.S. Attorney Adam Braverman. “Elected representatives should jealously guard the public’s trust, not abuse their positions for personal gain.  Today’s indictment is a reminder that no one is above the law.”

The Hunters are scheduled to be arraigned on the indictment on Thursday at 10:30 a.m. before U.S. Magistrate Judge William V. Gallo. They are charged with Conspiracy to Commit Offenses Against the United States, Wire Fraud, Falsification of Records and Prohibited Use of Campaign Contributions.

This case was investigated by the San Diego Division of the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorneys Phillip Halpern, Emily Allen and Mark Conover.  The United States Attorney’s Office would like to thank the Department of Justice’s Public Integrity Section, Election Crimes Branch for their assistance in this matter.\

Indictment Document (click

HERE )

DEFENDANTS                                            Case Number 18cr3677                               

Duncan D. Hunter                                           Age: 41                       Alpine, CA

Margaret E. Hunter                                         Age: 43                       Alpine, CA

SUMMARY OF CHARGES

Conspiracy to Commit Offenses Against the United States – Title 18, U.S.C., Sec. 371

Wire Fraud – Title 18, U.S.C., Sec. 1343

Falsification of Records – Title 18, U.S.C., Sec. 1519

Prohibited Use of Campaign Contributions – Title 52 U.S.C., Secs. 30109(d) and 30114(b)

Aiding and Abetting – Title 18, U.S.C., Sec. 2

AGENCY

Federal Bureau of Investigation

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

 

Assistant U.S. Attorneys Mark W. Pletcher (619) 546-9714 and Patrick Hovakimian (619) 546-9718

NEWS RELEASE SUMMARY – August 16, 2018

SAN DIEGO – U.S. Navy Captain (Retired) David Williams Haas was indicted by a federal grand jury yesterday on charges that he received at least $145,000 in bribes from foreign defense contractor Leonard Francis, who plied him with parties at luxurious hotels, prostitutes, top-shelf booze and food.

In separate indictments, Master Chief Petty Officer (Retired) Ricarte Icmat David and Chief Petty Officer (Retired) Brooks Alonzo Parks were charged with honest services fraud for receiving cash, luxury travel, lavish hotel suites, dining and the services of prostitutes from Francis, owner and chief executive of Glenn Defense Marine Asia. The company provided services such as tugboats, security, fuel, food, water and trash removal to U.S. Navy ships during port visits in Asia Pacific.

According to three indictments returned today in San Diego, the trio reciprocated by using their influence within the Navy’s Seventh Fleet to approve inflated invoices by GDMA, to steer ships to GDMA-controlled ports and otherwise advance the interests of Francis and GDMA. The indictment further alleges that they and their co-conspirators used their access to slip GDMA classified and proprietary U.S. Navy information, and helped GDMA recruit other U.S. Navy officers to join the conspiracy.

According to the eight-count indictment, Haas received the following bribes, among others, from Francis:

• On November 5, 2011, while Haas was director of Maritime Operations for the Seventh Fleet staff aboard the USS Blue Ridge, Francis took Haas and others to dinner at the Ritz Carlton in Tokyo, Japan, and provided them with prostitutes at a cost of more than $20,000.
   
• On May 11-15, 2012, Francis paid for rooms at the Shangri-La in Jakarta, Indonesia, plus dinner, entertainment at a night club, alcohol and prostitutes for Haas and others.
   
• On June 29-30, 2012, in Tokyo, Japan, Francis paid for a two-day party for Haas and others including transportation, dinner at Nobu Restaurant and entertainment at several hostess clubs where the services of prostitutes were provided, at a cost of more than $75,000.
   
• On November 30, 2012, Francis provided a car and driver for Haas and his subordinate and co-conspirator Commander Michael Misiewicz from Yokosuka, Japan, to the Ritz Carlton Hotel in Tokyo, where Francis was staying. (Misiewicz pleaded guilty and was sentenced to 78 months in prison for  conspiracy and bribery in April 2016). In Francis’s room, with Haas present, Misiewicz handed Francis an envelope of classified long-range Seventh Fleet ship schedules and Seventh Fleet organization charts. The schedules were stamped “SECRET” and projected ship visits approximately 14 months in advance. These classified schedules included information related to the U.S. Navy ballistic missile defense operations in the Pacific.  After reviewing the ship schedules, Francis, Haas and Misiewicz pored over the Seventh Fleet organizational chart, which Haas and Misiewicz had brought with them, in an effort to identify and evaluate potential successors to the corrupt relationship with Francis when Misiewicz departed the Seventh Fleet the following month, in December 2012.  Following these discussions, Francis took Haas and Misiewicz to a strip club where food and prostitutes were provided at a cost of approximately $7,000.

 

A separate indictment alleges that Master Chief Petty Officer David conspired with Francis, GDMA and others to defraud the United States of David’s honest services. In exchange for breaching his fiduciary duties to the United States Navy and the American public, David received cash, hotel rooms, and prostitutes.  According to the indictment, David conspired to accept things of value from Francis and other GDMA employees in exchange for David approving fraudulently inflated invoices following port visits, passing classified information to GDMA, advocating for GDMA in contracting disputes, and providing GDMA with internal U.S. Navy information concerning competitors.

Francis gave David cash in exchange for David approving GDMA’s fraudulently inflated ship husbanding invoices, the indictment alleges. After the receipt of one cash installment, on November 16, 2005, David emailed Francis thanking him for the “wonderful Christmas present.”  David, thereafter, repeatedly asked Francis for cash to build his retirement home in the Philippines, among other things. During the course of the conspiracy, David received a total of approximately $40,000 in cash from Francis.

A third indictment alleges that Parks received gifts, lavish hotel suites, airline tickets and various other benefits in exchange for Parks providing sensitive and proprietary U.S. Navy information, including competitor pricing and U.S. Navy ship and personnel movement information, among others.

So far, 32 defendants have been charged and 20 have pleaded guilty in the U.S. Navy bribery and fraud scandal.

The case is being prosecuted by Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the U.S. Attorney’s Office for the Southern District of California.                

DEFENDANT                                                                       Case Number: 18CR3656                           

Captain (Retired) David Williams Haas                                 Age 50             Kailua, Hawaii

SUMMARY OF CHARGES

Conspiracy to Commit Bribery, in violation of 18 U.S.C. § 371

Maximum Penalty: 5 years in prison, a $250,000 fine or twice the gross pecuniary gain or twice the gross pecuniary loss, whichever is greater

Bribery, in violation of 18 U.S.C. § 201

Maximum Penalty: 15 years in prison, a $250,000 fine

Conspiracy to Commit Honest Services Fraud, in violation of 18 U.S.C., Secs. 1349, 1346, 1343

Maximum Penalty: 20 years in prison, a $250,000 fine or twice the gross pecuniary gain or gross pecuniary loss from the offense, or three times the monetary equivalent of the thing of value, whichever is greater

DEFENDANT                                                                       Case Number: 18CR3655                           

Master Chief Petty Officer (Retired) Ricarte Icmat David    Age 61            Tarlac Province, Philippines

SUMMARY OF CHARGES

Conspiracy to Commit Honest Services Fraud, in violation of 18 U.S.C., Secs. 1349, 1346, 1343

Maximum Penalty: 20 years in prison, a $250,000 fine

DEFENDANT                                                                       Case Number: 18CR3657                           

Chief Petty Officer (Retired) Brooks Alonzo Parks               Age 46             Naples, Italy

SUMMARY OF CHARGES

Conspiracy to Commit Honest Services Fraud, in violation of 18 U.S.C., Secs. 1349, 1346, 1343

Maximum Penalty: 20 years in prison, a $250,000 fine

INVESTIGATING AGENCIES

Defense Criminal Investigative Service

Naval Criminal Investigative Service

Defense Contract Audit Agency

Assistant U. S. Attorney Timothy D. Coughlin (619) 546-6768    

NEWS RELEASE SUMMARY – August 17, 2018

SAN DIEGO – Jaime Aburto, a United States citizen with a prior alien smuggling conviction, was sentenced in federal court today to forty-four months in prison for his role in a smuggling incident that left a Border Patrol Agent injured.

The sentence was handed down by U.S. District Judge Gonzalo P. Curiel following the defendant’s guilty plea in May to one count of Transportation of Certain Aliens for Financial Gain, in violation of Title 8, United States Code, Section 1324. During today’s sentencing, the Court heard testimony from United States Border Patrol Agent Francisco Hurtado, who was seriously injured in apprehending Aburto.

“Smugglers see customers as dollar signs and have no concern for the safety and well-being of those they smuggle,” said U.S. Attorney Adam Braverman. “This office is committed to prosecuting smugglers, particularly when it results in an injury to a border patrol agent performing his duties.”

According to Agent Hurtado, he was performing his assigned duties in the Chula Vista Border Patrol Station’s area of responsibility when he was notified by a fellow agent that she had observed two suspected aliens attempting to conceal themselves in a construction area near the border. Agent Hurtado responded to the area and positioned himself to make contact with any vehicle that may attempt to pick up the two suspected aliens. In fact, a white van stopped and the two suspected aliens jumped into the van. Agent Hurtado began to follow the van and activated his emergency lights and siren as he observed the vehicle traveling westbound on State Route 11.  Agent Hurtado gave the driver of the van, later determined to be Defendant Aburto, an opportunity to pull over and stop at a safe location. Aburto did not stop and accelerated to a speed of over 100 miles per hour and merged onto State Route 125.

Over the next several miles of his pursuit, Agent Hurtado saw defendant Aburto make a dangerous U-turn in the center median of SR 125, speed through a red traffic light across oncoming traffic near Otay Mesa Road, swerve around moving traffic, drive over the dividing median on Siempre Viva Road, drive through two heavily populated retail commercial lots and finally drive onto the sidewalk along the southbound lane of Roll Avenue, where he struck a pole and came to a stop.

The defendant jumped from the van and began to run southbound on Roll Avenue towards the Otay Mesa, California Port of Entry. Agent Hurtado engaged in a foot pursuit of Aburto and was able to overtake him.  There was a brief struggle as both Agent Hurtado and Aburto ended up wrestling on the ground. Agent Hurtado placed Aburto under arrest with the assistance of fellow border patrol agents.

As a result of Aburto’s actions of resisting arrest, Agent Hurtado sustained a serious leg injury which required him to be out of work for several weeks. He is still working to recover full mobility. Agent Hurtado spoke at Aburto’s sentencing detailing his prior military service and his 15-year career with the Border Patrol. Judge Curiel departed upward given the injury sustained by Agent Hurtado and sentenced Aburto to 44 months in custody.

DEFENDANTS                                            Case Number: 18cr1975-GPC                       

Jaime Aburto                                                  Age: 38           San Diego, California

SUMMARY OF CHARGES

One Count – Transportation of Certain Aliens for Financial Gain and Aiding and Abetting – Title 8, U.S.C., Section 1324(a)(1)(A)(ii) and (a)(1)(B)(i)

AGENCIES

Homeland Security Investigations

U.S. Border Patrol

 

Assistant U. S. Attorney Robert Ciaffa (619) 546-7748    

SAN DIEGO – Jacob Burrell Campos, a 21-year-old Bitcoin dealer, was ordered held without bail today in connection with a 31-count indictment charging him with operating an illegal money transmitting business, failing to maintain an anti-money laundering program, international money laundering and conspiracy to structure monetary transactions. Burrell was arrested on August 13 as he tried to enter the United States from Mexico at the Otay Mesa Port of Entry.

According to statements made in court by Assistant U.S. Attorney Robert Ciaffa during today’s bond hearing, Burrell was a prolific Bitcoin dealer who sold approximately $750,000 worth of Bitcoin to hundreds of buyers throughout the United States. He conducted 971 separate transactions with over 900 individual customers, and accepted cash in person, through his bank accounts, and through MoneyGram.  AUSA Ciaffa told the court today that Burrell operated as a Bitcoin “exchanger,” and his activities constituted a “money transmitting business.”  As such, he was required to register with the Department of Treasury, and comply with all anti-money laundering requirements, including reporting suspicious cash transactions.  In this case, Burrell accepted cash “with no questions asked,” and in return for a 5% fee, supplied hundreds of individuals with an easy outlet to avoid the anti-money laundering laws applicable to all financial institutions, including licensed and registered Bitcoin exchanges.  According to AUSA Ciaffa, Burrell’s activities “blew a giant hole” through the legal framework of U.S. anti-money laundering laws by soliciting and introducing into the U.S. banking system close to $1 million in unregulated cash.    

Burrell is also charged with 28 counts of international money laundering. According to the indictment, Burrell sent 28 wire transfers totaling over $900,000 from his bank accounts in the United States to a bank account in Taiwan in the name of Bitfinex. Bitfinex is a crypto-currency exchange located in Hong Kong.  According to AUSA Ciaffa, Burrell sent the money from the United States to buy Bitcoin and fund his business. With these and other funds, Burrell bought over $3 million worth of Bitcoin in over 2,600 transactions.  Burrell resorted to buying Bitcoin through Bitfinex after his account was closed by Coinbase, a U.S.-based Bitcoin exchange, for circumventing its ID verification process.

The indictment also charges Burrell with conspiracy to structure the importation of monetary instruments.  According to statements made by AUSA Ciaffa in court today, Burrell agreed with others to smuggle over $1 million in U.S. dollars into the United States from Mexico, in amounts slightly less than $10,000, in order to avoid the currency reporting requirements. 

U.S. Magistrate Judge Karen S. Crawford found that Burrell had significant ties to Mexico, citizenship in three countries, no steady employment in the United States, the ability to access large sums of cash, and a disdain and unwillingness to comply with U.S. laws. She concluded that Burrell posed a substantial risk of flight, and ordered him held without bail.    

Burrell was born in San Diego, and lives in Rosarito, Baja California.   

DEFENDANT                                               Case Number 18CR3554-H

Jacob Burrell-Campos                                     Age: 21                       Rosarito, Baja California, Mexico

SUMMARY OF CHARGES

Count 1:  Conducting an unlicensed money transmitting business, in violation of 18 USC 1960.

Statutory maximum:  Five years in prison, $250,000 fine.

Count 2:  Failing to maintain an anti-money laundering program, in violation of 18 USC 5318(h), 5322(b)

Statutory maximum: Ten years in prison, $500,000 fine.

Counts 3-30:  International money laundering, in violation of 18 USC 1956(a)(2).

Statutory maximum: Twenty years in prison for each count, $500,000 fine.

Count 31:  Conspiracy to structure international instrument transactions, in violation of 18 USC 371 and 31 USC 5324(c)(3)

Statutory maximum: Five years in prison, $250,000 fine.

AGENCIES

Homeland Security Investigations

Internal Revenue Service

Postal Inspection Service

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.

 

Assistant U.S. Attorney Colin McDonald (619) 546-9144    

NEWS RELEASE SUMMARY – August 16, 2018

SAN DIEGO – Former U.S. Border Patrol Supervisory Agent Martin Rene Duran pleaded guilty in federal court today, admitting that he used his official position to create bogus alerts in a border-security law enforcement database to have an innocent man detained by Customs and Border Protection officers at the San Ysidro Port of Entry.

According to the complaint, the target of Duran’s false alerts was R.C., a man who had accused Duran’s brother-in-law, Raymundo Estrada Figueroa, of sexually abusing R.C.’s child in Mexico. Within one week of those allegations, as admitted during the plea proceedings, Duran directed a subordinate Border Patrol officer to create a law enforcement alert for R.C. which falsely claimed R.C. was frequently armed with a .45 caliber handgun. As Duran admitted today, over the next several months, Duran then entered several false alerts for R.C. into a system known as TECS, the principal database used by officers at the border to assist with screening individuals seeking entry into the United States. In one TECS alert, Duran falsely claimed R.C. was “known to carry firearms” and was linked to a narcotics organization. In another, Duran falsely claimed R.C. had made recent threats to law enforcement.

According to the complaint, R.C.—who is identified only by his initials to protect his son’s identity—is a lawful permanent resident of the United States with no known criminal history. He was detained on multiple occasions at the San Ysidro border crossing in 2013 based on the false alerts entered by Duran. According to the complaint, every time R.C. was detained, no weapons or contraband were found and he was released. On one occasion, R.C. and his wife were removed from their vehicle, handcuffed, separated from their minor children, escorted to the security office and put in a holding cell for almost two hours before they were released. According to the complaint, R.C. believed Duran was trying to pressure him into dropping the charges against Estrada, the brother-in-law. And today, Duran admitted he had R.C. detained at the Port of Entry so he could question him about the matter involving Estrada.

In a separate case earlier this year, Duran was convicted by a federal jury of seven counts of illegal transportation of firearms and one count of possession of a short-barreled rifle. Duran is scheduled to appear before U.S. District Judge Marilyn L. Huff on September 17, 2018 at 9:00 a.m. for sentencing on both matters.

“This agent used his significant power against someone he was sworn to protect,” said U.S. Attorney Adam Braverman. “He targeted a law-abiding citizen because of a personal vendetta, and for that he will pay a price.”

DEFENDANT                                  

Martin Rene Duran                             Age: 49                       Chula Vista    

SUMMARY OF CHARGES

Case Number: 15CR2818

Deprivation of Rights Under Color of Law, in violation of Title 18, U.S.C., Sec. 242

Maximum Penalty: 12 months’ custody, a fine of $100,000, one year of supervised release.

Case Number: 15CR2817

Title 18, United States Code, Section 922(a)(3) – Illegal Transportation of Firearms

Maximum Penalties: 5 years’ incarceration, a fine of $250,000, three years of supervised release.

Title 26, United States Code, Sections 5861 and 5871 – Possession of Unregistered Firearm: Maximum Penalties: 10 years’ incarceration, a fine of $250,000, three years of supervised release.

AGENCIES

Bureau of Alcohol, Tobacco, Firearms and Explosives

Immigration and Customs Enforcement – Office of Professional Responsibility

Department of Homeland Security – Office of Inspector General

U.S. Customs and Border Protection - Office of Professional Responsibility

Assistant U. S. Attorney Ryan R. Crosswell (619) 546-9661

NEWS RELEASE SUMMARY – August 15, 2018

SAN DIEGO – Supervisory U.S. Customs and Border Protection Officer Harvey Booker was indicted by a federal grand jury yesterday for deprivation of rights under the color of law. He was arrested at his home early this morning.

Booker made his initial appearance in federal court today before U.S. Magistrate Judge Karen S. Crawford.  His next court appearance is a motions hearing on September 7, 2018, at 2:00 p.m. before Chief U.S. District Judge Barry T. Moskowitz.

According to the indictment, on July 8, 2018, Booker, while acting under color of law as a Customs and Border Protection Officer, strangled M.N., willfully depriving him of the right, secured by the Constitution and the laws of the United States, to be free from unreasonable force and unlawful assault by a law enforcement officer. According to the indictment, Booker’s assault resulted in bodily injury to M.N. The victim was not identified in the indictment to protect his privacy. A prosecutor explained in court that this incident was “an act of violence against a traveler at the Port of Entry.”

“There is no excuse for law enforcement officials to abuse the significant trust and power placed in them,” said U.S. Attorney Adam Braverman. “Law enforcement takes great pride in protecting the civil rights of all people. When that trust is betrayed, we must hold that officer accountable.”

Amanda Thandi, Special Agent in Charge of the Department of Homeland Security (DHS), Office of Inspector General (OIG), San Diego Field Office, stated: “All DHS law enforcement officers are required and expected to abide by the laws they enforce and protect.  DHS OIG is committed to hold anyone who betrays the public’s trust accountable for his/her actions, while supporting the men and women who proudly uphold their duties to serve, protect, and ensure the constitutional rights of all persons.” The public is encouraged to report violations of civil rights regarding DHS programs and activities to the DHS Office for Civil Rights and Civil Liberties; the civil rights complaint form is available at https://www.dhs.gov/publication/file-civil-rights-complaint.

“U.S. Customs and Border Protection stresses professionalism, honor and integrity in every aspect of our mission and does not tolerate actions by any employee that would tarnish the reputation of our agency,” said CBP Director of Field Operations for San Diego, Pete Flores.  “CBP is fully cooperating with the FBI and DHS Office of the Inspector General regarding this investigation.”

DEFENDANTS                                                       

Harvey Booker                                               Age: 70                       San Diego, CA                       

SUMMARY OF CHARGES

Deprivation of Rights Under Color of Law – Title 18, U.S.C., Section 242

Maximum penalty: 10 years’ imprisonment and a $250,000 fine

AGENCIES

Department of Homeland Security – Office of Inspector General

U.S. Customs and Border Protection – Office of Professional Responsibility

Federal Bureau of Investigation

*An indictment is not evidence that the defendant committed the crime charged. The defendant is presumed innocent until the United States meets its burden in court of proving guilty beyond a reasonable doubt.

 

NEWS RELEASE SUMMARY – August 10, 2018

SAN DIEGO – Former Major League Baseball All-Star pitcher Esteban Loaiza pleaded guilty in federal court today to an Information charging him with possession of 20 kilograms of cocaine with intent to distribute.

In a change of plea hearing before United States District Judge Janis L. Sammartino, Loaiza admitted that on February 9, 2018, he took possession of a silver Mercedes-Benz sport utility vehicle that he knew to contain cocaine. He further admitted that he drove the SUV to a townhouse he rented in Imperial Beach, California, where he transferred 20 kilograms of cocaine to another vehicle in the garage, and that he did so with the intent to distribute the cocaine to another person.

Loaiza will remain on bond and subject to electronic location monitoring pending his sentencing hearing.

Sentencing is scheduled to occur before Judge Sammartino on November 2, 2018 at 10:30 a.m.

This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

DEFENDANTS                                            Case 18CR1743-JLS                        

Esteban Antonio Loaiza                                  Age: 46                                   Imperial Beach, CA

SUMMARY OF CHARGES

Possession of Cocaine with Intent to Distribute – Title 21, U.S.C., Section 841(a)(1)

Maximum penalty: Life imprisonment and $10,000,000 fine

AGENCIES

United States Drug Enforcement Administration

United States Border Patrol

San Diego Sheriff’s Department

 

Assistant U. S. Attorney Sherri Walker Hobson (619) 961-0287    

NEWS RELEASE SUMMARY – August 9, 2018

SAN DIEGO – Fernando Jesus Peraza, a U.S. citizen living in Tijuana, was arraigned in federal court today on charges of importing over 20,000 fentanyl pills in what is believed to be the largest seizure of fentanyl in pill form along the U.S.-Mexico border.

Peraza, who works in San Diego County, was arrested at the San Ysidro Port of Entry today at 2:30 a.m.   According to court records, Peraza was the driver, registered owner and sole occupant of the vehicle. U.S. Custom Border & Protection officers initially contacted Peraza in preprimary inspection area but was then referred to secondary inspection, where officers found four packages concealed in the passenger side rear quarter panel. The pills tested positive for fentanyl but were designed to resemble M30s, or oxycodone. 

At Peraza’s initial appearance today before U.S. Magistrate Judge Jill Burkhardt, the United States requested detention based on risk of flight. Judge Burkhardt scheduled a detention hearing for August 10, 2018 at 10:00 a.m. and a preliminary hearing for August 21, 2018 at 9 a.m.

Earlier this month, Cristian Araujo Aguirre, 19 of Tijuana, was charged with importing 11,490 fentanyl pills, 61 pounds of methamphetamine and 14 pounds of heroin.  Aguirre was arrested at the San Ysidro Port of Entry on August 1, 2018. Aguirre is currently detained. His next court appearance is on August 31, 2018.

“This is the biggest fentanyl pill seizure we’ve seen along the Southwest Border, and it’s likely a national record,” said U.S. Attorney Adam Braverman. “I’m relieved that these pills are off the streets because of the vigilant work of law enforcement. But that relief is tempered by the fact that people are overdosing every day because they took fentanyl-laced pills just like these, oblivious to the deadly consequences.”

DEFENDANT                        Case Number 18MJ4376                            

Fernando Jesus Peraza                Age: 38        Tijuana, Mexico

SUMMARY OF CHARGES

Importation of Controlled Substances

Maximum penalty: Ten years minimum to life; $1 million fine

INVESTIGATING AGENCIES

Homeland Security Investigations

U.S. Customs & Border Protection

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty. 

NEWS RELEASE SUMMARY – August 6, 2018

SAN DIEGO –   Today, District Judge Larry A. Burns sentenced Flavio Diego Rivera Davalos, 20, to 87 months in custody based on his guilty plea admitting that he smuggled approximately 77 pounds of fentanyl into the United States. Davalos, who was 19 at the time of the offense, was arrested at the San Ysidro Port of Entry on December 8, 2017 following one of the largest seizures of the deadly opioid along the Southwest border.  According to expert opinions included in court records, 77 pounds of fentanyl would yield 800,000 potentially fatal dosage units and a market value of more than $2 million.   

According to court documents, Davalos entered the United States from Mexico through the San Ysidro, California Port of Entry. Davalos, a visa holder, was the driver, sole occupant and registered owner of the 2010 Ford Focus bearing Baja California, Mexico license plates.  In pre-primary inspection, a Customs and Border Protection Officer and an assigned Narcotics and Human Detection Dog were conducting roving operations when the canine alerted to the odor of narcotics in the vehicle.  The CBP officer questioned Davalos regarding his purpose of travel to the United States and he responded that he was going to “Las Americas” Premium Outlets shopping mall. At the secondary inspection area, CBP officers detected anomalies in the rear seat and rear quarter panels of the vehicle. According to the complaint, officers found 31 packages of fentanyl throughout the vehicle, including in the driver’s side quarter panel, the passenger’s side quarter panel, the driver’s side rear seat, the passenger’s side rear seat, the speaker box and the firewall under the hood.

According to court records, Davalos initially agreed to transport drug proceeds from Los Angeles to Tijuana and the traffickers gave a vehicle to Davalos, who used his new vehicle for work and college.  Traffickers also gave money to Davalos to place the vehicle in his own name and directed Davalos to “burn” the plates through the Port of Entry to minimize suspicion.  Davalos was also directed to provide receipts of his crossings to the traffickers to confirm that he had multiple crossings.  Davalos gave his vehicle to the traffickers the day before he crossed, thereby facilitating the placement of drugs in his vehicle.  When he entered the Port the next day as part of a three-vehicle caravan headed to Los Angeles, Davalos suspected that all three vehicles were loaded with drugs.    

Rejecting the defense plea for a 30-month sentence, District Court Judge Burns commented that Davalos “did not play a ‘minor’ role in the offense” but rather played a significant part in importing an illegal drug, particularly given the volume of the deadly substance and the specific facts of this case.  Judge Burns additionally found it troubling that defendant, a college student in Tijuana, was also a teacher who failed to set a good example for his young students.

“Our district’s work enforcing drug laws has never been more important than it is right now.  Cartels are on a mission to use California ports of entry to funnel highly addictive and fatal opioids throughout the United States, exacerbating the deadliest drug crisis in American history,” stated U.S. Attorney Adam Braverman. “Here vigilant law enforcement agents took 800,000 fatal fentanyl doses off the streets, effectively preventing defendant’s deadly fentanyl stash from resulting in thousands of devastating overdoses.”                                        

DEFENDANT                                   Case Number: 18-cr-01120-LAB

Flavio Diego Rivera Davalos             Age 20              Tijuana, Mexico

CHARGES

Importation of Controlled Substance: 10 year minimum mandatory to life; fine of $1 million dollars; at least 3 years of supervised release; $100 Special Assessment

AGENCIES

Customs and Border Protection (CBP)

Homeland Security Investigations (HSI)

NEWS RELEASE SUMMARY – August 2, 2018

SAN DIEGO –   Today, Cristian Araujo Aguirre, 19, was arraigned by Magistrate Judge Barbara Major, on charges of importing 11,490 fentanyl pills, 61 pounds of methamphetamine and 14 pounds of heroin.   Aguirre was arrested at the San Ysidro Port of Entry on August 1, 2018. 

According to court records, Aguirre, a United States citizen living in Tijuana, was the driver and sole occupant of a vehicle.  U.S. Custom Border & Protection (“CBP”) officers found anomalies in the driver’s side and passenger side rear door panels and spare tire of his vehicle.  CBP removed 8 packages of heroin in the vehicle’s firewall, two packages of methamphetamine from the rear driver’s side door; 2 packages of methamphetamine from the rear driver’s side door; 5 packages of methamphetamine from the right rear quarter panel; 11 packages of methamphetamine from the right passenger rear door; 9 packages of methamphetamine in the spare tire, 2 bags and one box of pills (totaling 11,490 pills) in the left rear quarter panel of the vehicle.  The pills tested positive for fentanyl but were designed to resemble M30s, or oxycodone. 

MORE PHOTOS - Click HERE

At defendant’s initial appearance, the United States requested detention based on risk of flight.  The detention hearing is scheduled for August 7, 2018 at 9:30 before Judge Major.  His preliminary hearing is scheduled for August 16, 2018 at 9:30 before Judge Major.

DEFENDANT                                                Case Number 18MJ4249                             

Cristian Araujo Aguirre                                 Age: 19           Tijuana, Mexico

SUMMARY OF CHARGES

Importation of Controlled Substances

Maximum penalty: 10 years minimum to life; $1,000,000 fine; supervised release; $100 special assessment)

INVESTIGATING AGENCIES

Homeland Security Investigations

U.S. Customs & Border Protection (CBP)

The public is reminded that a complaint is a charging document.  A defendant is presumed innocent until the government meets its burden in court of proving guilt beyond a reasonable doubt. 

NEWS RELEASE SUMMARY – July 31, 2018

SAN DIEGO, CA – Heraclio Osorio-Arellanes, who is charged with the first-degree murder of U.nited S.tates Border Patrol Agent Brian Terry, was extradited from Mexico to the United States today, announced Attorney General Jeff Sessions and Southern District of California U.S. Attorney Adam Braverman for the Southern District of California.  He will be arraigned in U.nited S.tates District Court in, Tucson, Arizona, Wednesday tomorrow afternoon.  Osorio-Arellanes has been in custody awaiting extradition since his arrest by Mexican authorities on April 12, 2017. 

Agent Terry was fatally shot on Dec.ember 14, 2010, when he and other U.S. Border Patrol agents encountered Osorio-Arellanes and four other members of a “rip crew” (a criminal gang that attempts to steal from drug and alien smugglers) operating in a rural area north of Nogales, Arizona.  Of the six defendants charged along with Osorio-Arellanes in the case, three have pleaded guilty, two were convicted following a jury trial, and one other defendant – Jesus Rosario Favela Astorga (arrested by Mexican authorities in October, 2017) – has not yet been tried. is pending extradition to the United States.

“The Department of Justice is pleased that the suspected killer of Border Patrol Agent Brian Terry has been successfully extradited to the United States and will now face justice for this terrible crime,” said Attorney General Jeff Sessions. “We are grateful for the efforts of the Federal Bureau of Investigation, U.S. Marshals Service and U.S. Customs and Border Protection as well as our law enforcement partners in Mexico. To anyone who would take the life of an American citizen, in particular an American law enforcement officer, this action sends a clear message: Working closely with our international partners, we will hunt you down, we will find you, and we will bring you to justice.”

“The arrest and extradition of Osorio-Arellanes reflects the steadfast commitment and tireless work of the United States and our law enforcement partners in Mexico, who shared the common goal of seeking justice for the murder of Agent Brian Terry,” said U.nited S.tates Attorney Adam Braverman.  “When an agent makes the ultimate sacrifice while serving his country, we must hold all the individuals who played a part in this tragic outcome accountable for their actions.  This extradition moves that important goal forward.”

The indictment charges the defendants with first-degree murder, second-degree murder, conspiracy to interfere with commerce by robbery, attempted interference with commerce by robbery, use and carrying a firearm during a crime of violence and assault on a federal officer.  In addition to the murder of Agent Terry, the indictment alleges that the defendants assaulted U.S. Border Patrol Agents William Castano, Gabriel Fragoza and Timothy Keller, who were with Agent Terry during the firefight with the “rip crew.”

This case is being prosecuted in federal court in Tucson by attorneys from the Southern District of California, Special Attorneys Todd W. Robinson and David D. Leshner.  The U.S. Attorney’s Office for the District of Arizona is recused.  The case is being investigated by the FBI.  The Government of Mexico assisted in the apprehension and extradition.  The Justice Department’s Office of International Affairs provided assistance with the extradition of defendant Osorio-Arellanes.

The public is reminded that an indictment is a formal charging document and defendants are presumed innocent until the government meets its burden in court of proving guilt beyond a reasonable doubt. 

DEFENDANT                                                                        Case No. 11-CR-00150-TUC-DCB (BPV)     

Heraclio Osorio-Arellanes

AGENCIES

Federal Bureau of Investigation

U.S. Customs and Border Protection

United States Border Patrol

DOJ Office of International Affairs                          

 

NEWS RELEASE SUMMARY – July 31, 2018

SAN DIEGO – Juan A. Mexicano, aged 33, pleaded guilty today in federal court before U.S. Magistrate Judge Ruben B. Brooks to an expanding cocaine distribution conspiracy, extending from Mexico to San Diego to the Chicago, Illinois area.  Mexicano, who remains in custody, is the fourth defendant to plead guilty in this case.  He admitted to maintaining a narcotics stash house in Illinois to further the distribution of cocaine that emanated from a Mexican-based trafficker, identified in court documents as “El 99”, and which entered the United States via the Southern District of California.  Mexicano also admitted that a cache of firearms and other weapons, including two live grenades, that law enforcement located in a storage facility rented in Mexicano’s name were possessed in relation to his involvement in the narcotics conspiracy. 

Through his plea agreement, Mexicano admitted that the stash house, approximately 10 miles northwest of Chicago, was used for the temporary storage of cocaine before it was further distributed.  Mexicano acknowledged that, up to approximately150 kilograms (approximately 330 pounds) of cocaine were stored at that property.  In August 2016, shortly before a search warrant was executed at the property, Mexicano admitted that he removed bulk U.S. currency and cocaine from the property.   Mexicano also admitted that, to further the conspiracy, he temporarily stored drug proceeds at a stash house before those proceeds were moved south from the Chicago area to Mexico.

The federal charges to which Mexicano has pleaded guilty carry a mandatory minimum ten year sentence and a maximum life sentence.  Mexicano is scheduled to be sentenced on October 19, 2018 before U.S. District Judge Gonzalo P. Curiel in San Diego.

Notwithstanding his guilty plea in San Diego, Mexicano still faces weapons charges in Kane County, Illinois (Case No. 17CF1720) related to the discovery of the weapons cache in Elgin, Illinois.  In addition to the live grenades, the weapons seized included fully automatic weapons, a submachine gun and others.  A photograph of the weapons, previously released by the Elgin Police Department (see Report #2016-59306), is attached.

In addition to Mexicano, other defendants who have entered guilty pleas in the case are: Walter Rovidio Ipina, aged 40; David Castaneda-Solis, aged 33; and Zachary Vasquez, aged 27.

Through his plea agreement, Ipina admitted that, during 2016, he moved the cocaine provided by El-99 that entered the United States through the Southern District of California by using his family owned trucking business’ tractor-trailer to transport the cocaine from Southern California to the Chicago, Illinois area.  In September 2016, he was stopped by law enforcement agents who seized the 32 kilograms (approximately 70 pounds) of cocaine that he was then carrying.  Ipina is scheduled for sentencing on August 3, 2018 before Judge Curiel. 

Castaneda-Solis pleaded guilty to laundering the narcotics proceeds.  On August 12, 2016, Castaneda-Solis was caught by law enforcement while he was unloading $154,000 in narcotics proceeds from a hidden compartment in the dashboard of  a Honda Pilot vehicle.  The $154,000 was seized by law enforcement.  Castaneda-Solis admitted that he placed these proceeds into a black bag to enable their further transport to their ultimate destination in Mexico.  Castaneda-Solis is scheduled for sentencing on October 4, 2018.

Vasquez pleaded guilty to the cocaine conspiracy and admitted that he served as a narcotics load coordinator/recruiter.  He admitted to coordinating with “El 99” in Mexico.  Vasquez also admitted to recruiting and supervising a driver who smuggled cocaine through the San Ysidro Port of Entry on at least four occasions before that driver was arrested and the cocaine the load driver was then transporting was seized.  Vasquez admitted that his activity involved more than 125 kilograms, but less than 150 kilograms (between approximately 275 and 330 pounds) of cocaine.  Vasquez is scheduled for sentencing on September 13, 2018.

DEFENDANTS                                  Case Number 17-cr-648                                                                              

Juan A. Mexicano                                           Age: 33                                   Addison, IL

Walter R. Ipina                                               Age: 40                                   Victorville, CA

David Castaneda-Solis                                   Age: 34                                   Mexico

Zachary Vasquez                                            Age: 27                                   Anaheim, CA

SUMMARY OF CHARGES TO WHICH GUILTY PLEAS ENTERED

Mexicano, Ipina & Vasquez

Conspiracy to Unlawfully Distribute Cocaine, 21 U.S.C. 846

Maximum penalty: Life in prison, and a mandatory minimum 10 years; $10,000,000 fine; and at least five years’ supervised release up to life.

Castaneda-Solis

Conspiracy to Launder Monetary Instruments, 18 U.S.C. 1956(h)

Maximum penalty: 20 years custody; 3 years supervised release; and $500,000 fine.

INVESTIGATING AGENCIES

Homeland Security Investigations

Bureau of Alcohol Tobacco Firearms and Explosives

Ventura County, CA Sheriff’s Office

Police Departments of: Elgin, IL; Addison, IL.; Chicago, IL; Hoffman Estates, IL;

New Lenox, IL; Olympia Fields, IL; Streamwood, IL; and Lombard, IL

Sheriff’s Offices of: Kane County, IL; DuPage County, IL; Will County, IL

*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless  and until proven guilty.

 

 

 

 

Assistant U. S. Attorney Sherri Walker Hobson (619) 961-0287

NEWS RELEASE SUMMARY – July 20, 2018

SAN DIEGO –   U.S. Navy Commander Adolph Garza, a 23-year veteran, pleaded guilty in federal court today to drug charges, admitting that he conspired to distribute, deliver and dispense controlled substances by means of the internet.

Garza, a San Diego resident, admitted using the Dark Web to make multiple purchases of various controlled substances, including ecstasy, ketamine, cocaine, amphetamine and other controlled substances over an 18-month period, beginning on August 12, 2016 and continuing up to March 7, 2018.

According to his plea agreement, Garza used multiple dark web market places to order controlled substances for distribution in San Diego and beyond. In his plea agreement, Garza admitted that on at least 15 occasions, the drugs he ordered were the same ones seized by U.S. Customs and Border Protection at airports in San Francisco, New York and Chicago; and by U.S. Postal Inspectors and Homeland Security Investigations agents in San Diego.

On March 7, 2018, Garza was arrested by U.S. Postal Inspectors, Special Agents with Homeland Security Investigations, and Special Agents with Naval Criminal Investigative Service following a search warrant for his San Diego condominium. Inside his residence, agents found sealers, packaging and mailing materials, and concealment mailing methods (including DVD cases).  Federal agents also seized MDMA, cocaine, ketamine, amphetamine and other controlled substances, as Garza admitted today in federal court.

According to court records, Garza also distributed controlled substances, including powder and tablet forms of MDMA and ketamine, by mailing multiple packages to individuals in Texas. 

Garza is scheduled to be sentenced before U.S. District Judge Cynthia Bashant on December 10, 2018 at 9 a.m.

DEFENDANT                                               Case Number 18-cr-1745                             

Adolph Garza                                                 Age: 54           San Diego, California

SUMMARY OF CHARGES

Conspiracy to Distribute Controlled Substances by Internet

Maximum penalty: 20 years’ imprisonment and $500,000 fine

INVESTIGATING AGENCIES

U.S. Postal Inspection Service

Homeland Security Investigations

Naval Criminal Investigative Service

U.S. Customs and Border Protection

San Diego Police Department

Special Assistant U.S. Attorney Ari Fitzwater (619) 546-8756, Special Assistant U.S. Attorney Emily Gibbons (619) 546-8419, Assistant U.S. Attorney Connie Wu

NEWS RELEASE SUMMARY – July 19, 2018

SAN DIEGO – Five crew members were sentenced in federal court this week for smuggling 1,205 pounds of cocaine across the ocean in low-profile vessels, including a captain who received a 17-year term.

Two of the defendants had previously been convicted of similar crimes in the Middle District of Florida. United States District Judge Roger T. Benitez sentenced the defendants to spend between 84-210 months in prison. 

On September 17, 2017, captain Jorge Ortiz-Salazar and crewmembers Elpidio Enriquez and Laureano Benitez-Montano were spotted traveling in the Eastern Pacific Ocean aboard a low-profile vessel loaded with cocaine. Meanwhile, another boat captain, defendant Luis Alberto Corado-Polanco, and crew member Juan Jose Valiente-Tomes, were traveling in a go-fast vessel intending to rendezvous with the other crew onboard the low-profile vessel. United States Coast Guard Cutter JAMES launched a helicopter to intercept the defendants’ vessels.

When the Coast Guard helicopter intercepted the low profile vessel, Ortiz-Salazar abandoned it by jumping onto Corado-Polanco’s go-fast vessel. Corado-Polanco then attempted to outrun the Coast Guard. The Coast Guard helicopter issued orders to stop, and then issued warning shots, both of which were ignored. Ultimately the go-fast vessel was stopped when the Coast Guard fired disabling shots at its engines. The Coast Guard later recovered approximately 1,205 pounds of cocaine from the low profile vessel. 

Three defendants are Colombian nationals and two defendants are Guatemalan nationals. Three defendants admitted to conspiring to distribute the cocaine.  Of those three defendants, Laureano Benitez-Montano was sentenced to 84 months in custody; Luis Alberto Corado-Polanco was sentenced to 96 months in custody; and Juan Jose Valiente-Tomes was sentenced to 84 months in custody. The Court found that Corado-Polanco, as captain of the go-fast vessel, created a potentially dangerous situation by fleeing from law enforcement. The other two defendants admitted to possession with intent to distribute the cocaine while onboard a vessel subject to the jurisdiction of the United States.  Of those defendants, Elpidio Enriquez was sentenced to 180 months in custody and Jorge Ortiz-Salazar was sentenced to 210 months in custody. 

“As we see more and more smugglers taking to the ocean, hoping to go undetected in the vast territory of the Eastern Pacific Ocean, we have redoubled our efforts and committed more resources to this problem,” said U.S. Attorney Adam Braverman. “We are at the forefront of our nation’s war against drugs and will continue to work together with our law enforcement partners at the Coast Guard and the DEA to dismantle violent and dangerous transnational organized crime networks that are using the high seas as a Narco expressway.”

“The Coast Guard’s mission of interdicting drug smugglers in the Eastern Pacific Ocean is extraordinarily challenging, but it is essential to protect our nation from the international flow of illegal drugs and the transnational organized criminals that thrive from the drug trade,” said Rear Adm. Peter Gautier, Commander of the 11th Coast Guard District.  “The Coast Guard will be steadfast in our role to dismantle transnational drug trafficking networks by intercepting their vessels, seizing their drugs and bringing the traffickers to court to answer for their crimes.”

“These men were brazen in fleeing from the U.S. Coast Guard, but today they were acquainted with Lady Justice,” said DEA Special Agent in Charge Karen Flowers. “As she stands in judgement, let those who threaten our nation be reminded that when law enforcement joins forces, they face no greater enemy.”

This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.

DEFENDANTS                                                       

Case Number 17cr3293                                           

Elpidio Enriquez                                                         Age: 62                                               Colombia

Laureano Benitez-Montano                                        Age: 43                                               Colombia

Case Number 17cr3328                                           

Luis Alberto Corado-Polanco                                     Age: 39                                               Guatemala

Juan Jose Valiente-Tomes                                           Age: 49                                               Guatemala

Jorge Ortiz-Salazar                                                    Age: 42                                               Colombia

SUMMARY OF CHARGES

Possession with Intent to Distribute Cocaine Onboard a Vessel Subject to the Jurisdiction of the United States – Title 46, U.S.C., Section 70503

Maximum Penalty: Life in prison and $10,000,000 fine

Conspiracy to Distribute Cocaine Intended for Unlawful Importation – Title 21, U.S.C., Sections 959, 960, and 963

Maximum penalty: Life in prison and $10,000,000 fine

AGENCY

Drug Enforcement Administration

United States Coast Guard

 

Assistant U. S. Attorney Benjamin A. Bish (619) 546-8662    

NEWS RELEASE SUMMARY – July 17, 2018

SAN DIEGO – Jorge Luis Martinez-Hernandez, a Mexican citizen with a prior alien smuggling conviction, was sentenced in federal court yesterday to more than eight years in prison for his role in a smuggling incident that left two undocumented immigrants dead.

The sentence was handed down by U.S. District Court Judge Marilyn L. Huff following the defendant’s guilty plea in April to eight counts of Bringing in Certain Aliens resulting in Death and Bringing in Certain Aliens for Financial Gain, all in violation of Title 8, United States Code, Section 1324.

“Smugglers see customers as dollar signs and have no concern for their safety and well-being,” said U.S. Attorney Adam Braverman. “This office is committed to prosecuting smugglers who exploit immigrants for financial gain.”

“This should give us all pause when thinking about the blatant disregard for human life,” said San Diego Sector Chief Patrol Agent Rodney Scott. “To tell people to cross a freeway in complete darkness with cars driving at 65-plus miles per hour is unconscionable. The men and women of the U.S. Border Patrol remain vigilant in our pursuit of these smugglers and the international criminal organizations they work for.”

“Martinez-Hernandez’s actions in this event led to the unfortunate deaths of two people. His conviction and sentence brings some closure to an unnecessary tragedy that involved exploiting individuals for his financial gain,” said David Shaw, Special Agent in Charge for Homeland Security Investigations (HSI) in San Diego. “This tragic case has once again heightened HSI’s commitment to enforce all criminal immigration law and we will continue our efforts to investigate and ultimately dismantle the transnational alien smuggling organizations.”

According to his plea agreement, on September 17, 2017, at approximately 1:45 a.m., Martinez-Hernandez guided eight undocumented individuals - five adults and three minors - through a hole in a wall near the San Ysidro, California Port of Entry.  Martinez-Hernandez and the group of eight entered a vehicle waiting on the U.S. side of the border near the hole, which was next to the southbound side of the Interstate 5.  Martinez-Hernandez took control as the driver and then made a U-turn into the oncoming traffic in the southbound lanes of the interstate.  He then drove north in the southbound lanes against traffic. Customs and Border Protection Officers began pursuit of the vehicle, driving north in the northbound lanes to track Martinez-Hernandez’s movements on the southbound side of the interstate.  Martinez-Hernandez then stopped the vehicle on the side of the interstate and directed the eight to follow him to another area. He admitted to investigators that he did this because his coconspirators planned to pick the group up in other vehicles to take them farther into the U.S. illegally. 

The investigation revealed that Martinez-Hernandez led the group of eight on foot across the northbound lanes of the Interstate 5, over the dividing fence, and across the southbound lanes. A vehicle travelling south at or near highway speed in the southbound lanes struck two of the undocumented individuals in the group as they ran across the interstate. The collision occurred near the Camino De La Plaza exit on Interstate 5.  The two were pronounced dead at the scene.  Martinez-Hernandez and the six remaining undocumented individuals were later apprehended when they were found hiding near the southbound side of the interstate and the Camino De La Plaza exit. 

Martinez-Hernandez admitted to guiding the eight during this event.  He further admitted that the eight undocumented individuals, including one who was from China, agreed to pay between $7,000 to $13,000 to be smuggled into the U.S.  Martinez-Hernandez admitted that he was going to receive $1,000 per undocumented individual that he successfully smuggled into the U.S. illegally.

DEFENDANTS                                            Case Number: 17cr3288-H                          

Jorge Luis Martinez-Hernandez                     Age: 33                                   Tijuana, B.C., Mexico

SUMMARY OF CHARGES

2 Counts - Bringing in Certain Aliens Resulting in Death – Title 8, U.S.C., Section 1324(a)(1)(A)(i) and (a)(1)(B)(iv), a Class A felony

6 Counts - Bringing in Certain Aliens for Financial Gain and Aiding and Abetting – Title 8, U.S.C., Section 1324(a)(2)(B)(ii) and Title 18, U.S.C., Section 2, a Class A felony

AGENCIES

Homeland Security Investigations

U.S. Customs and Border Protection

U.S. Border Patrol

California Highway Patrol

San Diego Fire Department

San Diego County Medical Examiner’s Office

 

 

Assistant U. S. Attorney Cindy Cipriani (619) 546-9608    

NEWS RELEASE SUMMARY – July 16, 2018

SAN DIEGO – Federal and state law enforcement officials have launched a billboard campaign in San Diego and Imperial counties to prevent middle and high school students from acting as drug mules for cartels.

The billboards, located in San Diego and Imperial counties as well as one in Mexico, feature stark warnings to minors that smuggling drugs could cost them their freedom and their futures and is not worth the few hundred dollars they are being offered. They were unveiled today at two locations in San Ysidro and one in Tijuana.

Also today, a San Diego teenager pleaded guilty in federal court to charges that he recruited classmates to smuggle methamphetamine and fentanyl. Phillip Junior Webb was a senior at Castle Park High School in Chula Vista when he committed the drug offenses.

The number of incidents in which drugs were seized from minors at ports of entry in the Southern District of California has increased significantly in recent years. There was a 153 percent spike in drug seizures from minors from FY 2016 to FY 2017, from 39 to 99. With four months to go in FY 2018, the pace is set to match FY 2017, with a troubling new twist: Minors are smuggling ultra-deadly fentanyl, which has not happened in prior years.

“As law enforcers, and as parents, we are tremendously concerned about our youth being exploited by drug cartels,” said U.S. Attorney Adam Braverman. “Juveniles need to know that consequences are real and dramatic. Ultimately, it is your choice, and the decision you make now will follow you the rest of your life. Don’t sell your future for a few hundred dollars.”

“We live in a beautiful county which includes a world class city and one of the busiest land border crossings in the world, the San Ysidro Point of Entry. Thousands travel by foot and car to conduct business, visit friends and family, shop, eat, and enjoy life each day. Our enemies use this same border crossing to entice our children to bring death and destruction to the United States,” said DEA Special Agent in Charge Karen Flowers.  “Parents, teachers, students - all of us need to know that drug smuggling fuels destruction of lives and the violence on both sides of the border. It is not okay. It is not sexy. It is not easy money. It is not worth losing your life, your dreams, your potential.”

“Smuggling narcotics is a dangerous proposition especially a lethal drug such as fentanyl,” said Pete Flores, director of field operations for CBP in San Diego. “Juveniles need to understand there that no matter what they have been told, there are consequences for smuggling narcotics, not to mention the dangers of working with transnational criminal organizations.”

“In less than a year, at least 70 juveniles were arrested at the Port of Entry trying to smuggle methamphetamine, cocaine, heroin and deadly Fentanyl into San Diego County,” District Attorney Summer Stephan said. “These are young people who are being used by dangerous, organized criminals and who do not fully understand the danger they are putting themselves in and the harm and devastation to potential drug users.”

“Homeland Security Investigations (HSI) is committed to investigating, dismantling, and referring for prosecution cases in which Transnational Criminal Organizations utilize juveniles to smuggle contraband for financial gain,” said James Plitt, Deputy Special Agent in Charge for HSI in San Diego.  “These dangerous organizations exploit young teenagers who do not fully understand  the negative consequences that this will have in their lives, those of their family and future goals.  Since 2009, HSI has partnered with CBP and other law enforcement agencies and prosecutors to educate the juveniles, parents, and community members of the dangerous people that are recruiting and targeting these juveniles. This outreach effort will remain a priority as long as these children continue to be exploited.”   

DEA reports that during a one-week span in March of this year, five minors were arrested at the San Ysidro Port of Entry attempting to smuggle significant quantities of fentanyl into the country. Other recent incidents involved a female teen who was driving a vehicle with fentanyl and cocaine concealed within the car. And on four different occasions, teenage boys attempted to enter through pedestrian lanes at the San Ysidro Port of Entry with over 2 kilograms each of fentanyl strapped to their bodies, under their clothes. According to DEA, 2 kilograms of fentanyl equals 2 million milligrams of fentanyl, and it would only take 2 to 3 milligrams to cause respiratory depression and possible death.

Drug traffickers take advantage of the naïve nature of juveniles and lure them with incentives like money and electronics in exchange for illegally crossing drugs into the U.S. Many of these children are recruited at the high schools they attend and some are being recruited by classmates.

Parents, teachers, caretakers, school administrators and children need to be aware that recruiting efforts of traffickers pose a constant threat. They have been known to recruit children at schools, but also may approach them at after-school functions, camps, libraries, on public transportation, via social media outlets, and over electronic communications like gaming consoles, text messages or chat rooms. Recruiters could be other children, parents, familiar adults or complete strangers.

In response to the trend, federal, state and local law enforcement have teamed up to educate the region’s youth about the consequences through school programs and billboards, including two billboards in San Diego County, one on the Mexican side of the border, several in Imperial County and many more are under consideration for Arizona, Texas and New Mexico. They warn about the dangers and collateral consequences of drug smuggling. These billboards were funded by the Drug Enforcement Administration and the High Intensity Drug Trafficking Area program, a drug-prohibition enforcement program run by the United States Office of National Drug Control Policy.

Prosecutors and agents are holding educational programs in South Bay high schools so that kids are aware of the extreme dangers of handling dangerous drugs like fentanyl, of working with violent cartels, and the fallout from being arrested and charged with related crimes.

Anyone with concerns about potential recruiting is encouraged to call the local DEA office at 858-616-4100 or submit a tip to the Drug Enforcement Administration via its website, www.DEA.gov.

In federal court today, Webb admitted that he arranged for juvenile couriers to smuggle a total of 6.18 kilograms of methamphetamine and 1.2 kilograms of fentanyl into the United States from Mexico, for delivery in San Diego, on four occasions: July 12, 2017; September 19, 2017; September 27, 2017 and October 23, 2017. On each of these occasions, the juveniles had drugs strapped on their bodies as they attempted to enter the United States at the San Ysidro or Otay Mesa Ports of Entry.

He also admitted that on May 5, 2018, he knowingly drove two undocumented immigrants into the United States at the San Ysidro Port of Entry in the trunk of his car for financial gain.

Webb is scheduled to be sentenced by U.S. District Judge Michael M. Anello on October 9, 2018 at 10:15 a.m.

DEFENDANT                                   Case No. 18MJ2229

Phillip Junior Webb                            Age: 18       Tijuana, Mexico

CHARGES

Count 1 – Conspiracy to Distribute Methamphetamine  (21 U.S.C. 841 & 846)

                  Maximum Penalty: Ten years minimum to life in custody; $1 million fine

Count 2 -  Bringing in Undocumented Aliens for Financial Gain (8 U.S.C. 1324)

                  Maximum Penatly: Three years mandatory minimum to 20 years in custody; $250,000 fine

AGENCY

Homeland Security Investigations

Drug Enforcement Administration

Customs & Border Protection

Homeland Security Investigations

San Diego County Sheriff’s Department

 

 

Special Assistant U.S. Attorney Jeffrey D. Hill (619) 546-7924 and Assistant U.S. Attorney Anne Perry (619) 546-7964

NEWS RELEASE SUMMARY – July 13, 2018

SAN DIEGO – Andres Avelino Anduaga was sentenced today to 37 months in federal prison for stealing over $350,000 in government benefits from federal, state and local agencies while impersonating an American citizen for over 30 years.  Anduaga was also ordered to repay $360,908.85 in restitution to the Social Security Administration, the California Department of Health Care Services and the County of San Diego.

In 1980, Anduaga used a birth certificate belonging to a United States citizen to obtain a California Driver’s License and a Social Security card.  Already a convicted felon, Anduaga used his new identity to commit a variety of crimes over the next 22 years.   

As he admitted in his plea agreement, Anduaga used that stolen identity to apply for disability benefits from the Social Security Administration in 1989.  Through 2016, he received almost $250,000 in Social Security benefits that he was not entitled to receive.  As a direct result, Anduaga also received Medi-Cal health benefits that he should not have been eligible to receive, and caused a loss of over $100,000 to the State of California.  Even after his Social Security was terminated in 2016, Anduaga signed up for CalFresh/Supplemental Nutrition (SNAP) benefits and continued to receive those benefits right up until his arrest in November 2017. 

In addition to his Theft of Public Property, U.S. District Judge John A. Houston also sentenced Anduaga for being a Removed Alien Found in the United States.  Anduaga admitted that, despite twice being deported as “Jose Reyes” in 1994 and 2000, he was able to return and travel freely between the United States and Mexico using a United States passport that he obtained using the same stolen identity he used to defraud public assistance programs. 

 “The theft of Social Security benefits is a direct attack on the most vulnerable and needy members of our community,” said U.S. Attorney Adam L. Braverman.  “Every dollar stolen through this kind of fraud reduces the funds available to our retirees and other worthy beneficiaries.”

“The SSA-OIG is steadfast in its determination to combat Social Security fraud, and relies heavily on the cooperation of both the Department of Justice and the Social Security Administration to meet this goal.  Preserving the integrity of SSA’s programs, through criminal prosecution when necessary, is crucial to the future of SSA’s beneficiaries and America’s taxpayers.  I’m pleased to see charges brought in this case and grateful that the DOJ shares our determination to ensure the integrity of SSA’s programs,” said Robb Stickley, Special Agent in Charge of the Inspector General’s Office of Investigations in San Francisco.

“It is this kind of malicious theft of identity and people’s hard-earned benefits which highlights the need for vigilance and thoroughness in all encounters which Border Patrol Agents undertake to thwart this kind of illegal activity,” said Chief Patrol Agent Rodney Scott. “This successful collaboration between the Social Security Administration, the U.S. Border Patrol and the Department of Justice highlights the need for, and importance of, cooperation among law enforcement partners.”

DEFENDANT                       Case Number 17-cr-4461-JAH       

Andres Avelino Anduaga       Tijuana, Mexico

SUMMARY OF CHARGES

Theft of Public Property – Title 18, U.S.C., Section 641

Maximum penalty: 10 years’ imprisonment, $721,817.70 fine, restitution

Removed Alien Found in United States – Title 8, U.S.C. Section 1326(a)

Maximum penalty: 2 years’ imprisonment, $250,000 fine

AGENCIES

Social Security Administration’s Office of the Inspector General

United States Border Patrol

United States Customs and Border Protection

California Department of Health Care Services

California Department of Motor Vehicles Investigations Division

Bureau of Public Assistance Investigations, County of San Diego