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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury sitting in New Haven has returned an indictment charging JOSEPH T. MORRIS, 51, of Fort Lauderdale, Fla., formerly of Connecticut, with defrauding the co-founders and investors of his Wilton-based company out of approximately $175,000.  The indictment was returned on July 1, 2014, and was unsealed yesterday during MORRIS’s arraignment before U.S. Magistrate Judge Holly B. Fitzsimmons in Bridgeport.

According to the indictment, MORRIS and two other individuals formed a company in October 2011 to develop business opportunities in Iraq.  The company’s initial focus was on establishing a pizza restaurant at the U.S. Consulate compound in Erbil, Iraq, and establishing a business to distribute and install specialty window film on vehicles and at hotels, residences, and government buildings, which would protect windows and windshields from blast and breakage, and provide heat retention, ultra-violet shielding, and privacy.  MORRIS was the company’s in-country manager in Iraq.

The indictment alleges that MORRIS made numerous fraudulent representations to his co-founders regarding the restaurant and the window film business, knowing that the representations would be communicated to potential investors to induce them to invest in the company.  Through the use of fraudulent emails and photographs, MORRIS falsely represented that a lease had been signed to establish a pizzeria on the U.S. consulate compound in Erbil, that renovations were underway, and that progress was being made toward completing renovations and opening the restaurant.  MORRIS also falsely represented that the company had an exclusive arrangement with a specialty window film manufacturer to distribute and install the window film in all of Iraq.  Based on these misrepresentations, MORRIS caused approximately a dozen investors, most of whom were U.S. military veterans, to invest approximately $175,000 in the company.  Instead of using the money from investors to pay for legitimate business expenses, MORRIS diverted large sums of money for his own personal use.

The alleged scheme collapsed in late April to early May 2012 when one of the co-founders discovered that the company did not have a lease or agreement to open and operate a pizza restaurant at the U.S. consulate compound in Erbil and that the company did not have an exclusive arrangement with a window film manufacturer to distribute and install specialty window film in Iraq.

The indictment charges MORRIS with five counts of wire fraud, an offense that carries a maximum term of imprisonment of 20 years on each count.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This case is being investigated by the U.S. Secret Service, the Wilton Police Department, and the Connecticut Financial Crimes Task Force, which includes federal, state and local law enforcement agencies.  The case is being prosecuted by Assistant U.S. Attorney Neeraj N. Patel.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that EL MEHDI SEMLALI FATHI, 26, a citizen of Morocco last residing in Bridgeport, waived his right to indictment and pleaded guilty today before Chief U.S. District Judge Janet C. Hall in New Haven to one count of perjury in an immigration matter.

According to court documents and statements made in court, in January 2008, FATHI was admitted to the United States after he obtained a student visa to study at Virginia International University.  In February 2009, FATHI’s student visa status was terminated by the university after he failed all of his classes during the Fall 2008 semester and did not register for classes for the Spring 2009 semester.  After his student visa status was terminated, FATHI failed to leave the U.S.

In December 2010, FATHI was detained in immigration custody as a result of an arrest in Virginia.  While he was detained, he met an individual who explained refugee relief to him.  In an effort to obtain refugee relief and remain in the U.S., FATHI reviewed certain country reports relating to Morocco and then prepared and filed, under penalty of perjury, a false refugee application (I-589), which included events he learned about in the country reports.  FATHI’s false statements included a claim that he would be persecuted by the Kingdom of Morocco based on his membership in a particular social group and imputed political opinion, and that he was arrested twice in 2007 and persecuted by the Moroccan government.

In June 2011, an immigration judge in Virginia released FATHI on bond.  FATHI then moved to Bridgeport and his immigration case was transferred to Connecticut.  In September 2011, FATHI represented to an immigration judge in Hartford that all of the information on his I-589 application was accurate when he knew that all of the information in support of his refugee claim was materially false.

While his immigration proceedings were pending, FATHI traveled to California where he was arrested and subsequently placed in immigration custody.  In January 2013, after his immigration proceedings were transferred to California, FATHI again falsely represented to an immigration judge in Adelanto, Calif., that his refugee application was true and accurate.  In another hearing in August 2013, FATHI again committed perjury while testifying in support of his refugee application by stating that he was arrested and savagely beaten several times by the Moroccan authorities when, in fact, he was never arrested or persecuted by the Moroccan authorities, and that he attended a university in Marrakech during which he participated in demonstrations that caused him to be arrested by the Moroccan authorities when, in fact, he never attended any university in Marrakech.

In February 2014, during an interview with a federal agent, FATHI falsely claimed that Moroccan intelligence authorities had arrested him as part of a conspiracy with all of the other members of Jamaat Ansar El-Mehdi, a Moroccan based terrorist group that was dismantled by Moroccan security forces in 2006.

FATHI has been detained since his arrest on April 7, 2014.

Chief Judge Hall scheduled sentencing for October 20, 2014, at which time FATHI faces a maximum term of imprisonment of five years.

In addition, FATHI has agreed to inform the immigration court that he falsified his refugee application, as well as perjured himself, and will accept a final order of removal to Morocco.

This matter is being investigated by the Federal Bureau of Investigation’s Joint Terrorism Task Force, which includes participants from Homeland Security Investigations (HSI) in New Haven, Internal Revenue Service – Criminal Investigation Division, Naval Criminal Investigative Service, Connecticut State Police, Bridgeport Police Department, Norwich Police Department and the New York Police Department.  The HSI attaché office in Casablanca, Morocco, has provided critical assistance to the investigation.

The case is being prosecuted by Assistant U.S. Attorney Krishna Patel and Stephen Reynolds.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, New London Police Chief Margaret Ackley and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, today announced that JOSE ROSADO, JR., also known as “Gugie,” 21, of New London, waived his right to indictment and pleaded guilty yesterday before U.S. District Judge Vanessa L. Bryant in Hartford to one count of committing a violent crime in aid of racketeering, and aiding and abetting the same.  The charge stems from the September 2012 homicide of Javier Reyes, 36, of New London.

According to court documents and statements made in court, ROSADO was an associate of a criminal organization that distributed marijuana, cocaine and other narcotics from the “Green Garages,” a series of garage bays located as 12/14 Walker Street in New London.  In the summer of 2011, the leader of the Green Garages organization was the intended victim of a murder-for-hire plot orchestrated by former members of his enterprise in an attempt to take over narcotics distribution at the Green Garages.  It is alleged that the leader of the organization orchestrated the assault of Javier Reyes to maintain his leadership position.  ROSADO and others were hired to carry out the assault of Reyes in exchange for cash.

On the evening of September 12, 2012, Reyes was stabbed multiple times outside of his apartment at 187 Huntington Street in New London, and died a short time later.  He also had blunt force trauma to the back of his head.

Video surveillance at the time of the attack shows ROSADO, carrying a bat, and another individual, creeping toward Reyes and then running away from him about 15 seconds later.

ROSADO has been detained since his arrest on January 15, 2014.  When he is sentenced, he faces a maximum term of imprisonment of 20 years. 

The alleged leader of the Green Garages organization, the other individual seen in the surveillance video and the individual who allegedly recruited ROSADO have been indicted as a result of this investigation.  U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.  A trial is scheduled for February 2015.

This matter is being investigated by the New London Police Department and the Federal Bureau of Investigation, with the assistance of the Connecticut State Police’s Eastern District Major Crime Squad, the Connecticut Department of Correction, Homeland Security Investigations, the U.S. Secret Service and the New London State’s Attorney’s Office.  The case is being prosecuted by Assistant U.S. Attorneys Anthony Kaplan and Sarah Karwan, and Senior Assistant State’s Attorney Paul Narducci.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that JESSE C. LITVAK, a registered broker-dealer and former managing director at New York investment bank Jefferies & Co., Inc. (Jefferies), was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to 24 months of imprisonment, followed by three years of supervised release, for defrauding customers trading in residential mortgage-backed securities (RMBS).  LITVAK was also ordered to pay a fine of $1.75 million.

For nearly three years, Jesse Litvak lied over 70 times to numerous Jefferies’ customers, cheating them and stealing their investors’ money,” stated U.S. Attorney Daly.  “While Litvak was being paid millions as a trader and managing director, he defrauded dozens of victims resulting in over six million dollars in loss to investors.  The victim investors included pension funds for teachers, firefighters, police officers, and other state or municipal employees, as well as taxpayer-provided bailout funds that helped our nation to recover from the 2008 financial meltdown.  This sentence serves as a warning bell to those who risk engaging in such corrupt practices.  We hope that this prosecution will act as a forceful disincentive to market participants tempted to commit securities fraud.  We commend SIGTARP and the FBI for their outstanding work on this investigation.”

“Today’s sentencing sends a clear message that lying in the already opaque markets of mortgage backed securities to drive up prices for the sake of profits is a crime that will result in years in federal prison,” said Christy Romero, Special Inspector General for TARP (SIGTARP).  “When caught by a customer trading with taxpayer bailout dollars, senior bond trader Litvak said it was a ‘hard year’ and ‘guys were doing what they needed to make money.’  The fact is that it was a hard year for everyone in that market.  The government used taxpayer dollars in a TARP bailout program to help restart a frozen mortgage backed securities market, but Litvak saw it as a criminal opportunity.  Litvak bragged in online chats about lying to customers and driving up prices, conduct that ultimately resulted in $6.3 million in fraudulent profits for his firm, Jefferies.  Litvak knew full-well that some of those customers were funds filled with taxpayer dollars, and he has zero remorse for ripping off those customers and jeopardizing the integrity of the bailout program, all for the sake of pure greed.  I want to thank U.S. Attorney Deirdre Daly for standing united with SIGTARP in the fight against bailout-related crime.”

“In March, a jury found Mr. Litvak guilty of securities fraud and TARP fraud; today, he learned that he will spend time in federal prison for those crimes,” said FBI Special Agent in Charge Ferrick. “With the incredible but legitimate salary Mr. Litvak was earning, the only explanation for his pilfering ways is pure and unadulterated greed.  Let this be a message to those in a position of trust who cheat their investors and the government:  You will be investigated, prosecuted and convicted.  Most importantly, you will go to jail.  The FBI is very appreciative of the work SIGTARP and the U.S. Attorney’s Office has done to ensure justice and encouraged by the deterrent effect Mr. Litvak’s case will have moving forward.”

On March 7, 2014, a jury found LITVAK guilty of 10 counts of securities fraud, one count of TARP fraud, and four counts of making false statements to the federal government.  According to the evidence introduced during the trial, in response to the 2008 financial collapse, the U.S. Department of Treasury introduced the Legacy Securities Public-Private Investment Program (PPIP), and used more than $22 billion of bailout money from the Troubled Asset Relief Program (TARP) to restart the trading markets for many troubled securities, including certain kinds of RMBS.  The program created nine PPIP funds, and more than 100 firms applied to manage the funds.  TARP infused between $1.4 billion and $3.7 billion of bailout money into each of the PPIP funds that was to be invested alongside private capital.

LITVAK, 39, of New York, N.Y., was a senior trader and managing director at Jefferies, a global securities and investment banking firm headquartered in New York.  Jefferies also had a trading floor in Stamford, Conn., where LITVAK and other members of its Mortgage and Asset-Backed Securities trading group worked.  Between February 2009 and October 2011, LITVAK engaged in a scheme to defraud Jefferies’ customers based on two types of misrepresentations.  First, as a broker-dealer, only LITVAK – not the bond seller or buyer – knew the selling and asking prices of the parties.  LITVAK exploited this information by misrepresenting the RMBS seller’s asking price to the buyer and by misrepresenting the buyer’s asking price to the seller.  By fraudulently increasing the difference or “spread” between the price paid by the buyer and the price paid to the seller, LITVAK pocketed the difference for Jefferies.  Second, LITVAK took bonds held in Jefferies’ inventory and sold them to RMBS buyers only after inventing a fictitious third-party seller.  This ruse allowed LITVAK to charge the buyer an extra commission that Jefferies was not entitled to because it was selling bonds it held in its own inventory.

LITVAK perpetrated this scheme more than 70 occasions against numerous PPIP funds and private investment funds, netting Jeffries more than $6.3 million in fraudulent profits.

LITVAK has been released on bond since his arrest on January 28, 2013.  He was ordered to report to prison by November 5, 2014.

The investigation of this matter revealed that members of Jefferies’ management in the fixed income division became aware that Jefferies employees were making misrepresentations to customers and did nothing to stop it.  Jefferies has cooperated with the federal criminal investigation and, on January 29, 2014, agreed to pay a total penalty of $25 million as part of a non-prosecution agreement with the government.  The penalty includes up to $11 million in restitution to victims and up to a $4,200,402 penalty to the U.S. Securities and Exchange Commission (SEC).  Jefferies also agreed to address deficiencies in the compliance and ethics practices and policies of its Mortgage and Asset-Backed Securities Trading group.  These measures include Jefferies’ agreement to retain an Independent Compliance Consultant to conduct a review of Jefferies’ policies and procedures for detecting and preventing fraud in connection with the purchase or sale of RMBS.

U.S. Attorney Daly noted that the criminal investigation of individuals and institutions involved in fraudulent RMBS trading activities remains active and ongoing.

This matter is being investigated by SIGTARP and the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Jonathan Francis and Christopher Mattei.

This prosecution was brought in coordination with the RMBS Working Group, a joint federal and state initiative created to investigate those responsible for misconduct contributing to the 2008 financial crisis. RMBS were pools of mortgages deposited into trusts and then sold as securities to investors who were to receive a stream of income from the mortgages packaged in the RMBS. The RMBS Working Group, which is chaired by Attorney General Eric Holder, brings together more than 200 attorneys, investigators, analysts and staff from dozens of state and federal agencies including the Department of Justice, ten U.S. Attorneys’ Offices, the FBI, the Securities and Exchange Commission, the Department of Housing and Urban Development (HUD), HUD’s Office of Inspector General, the Federal Housing Finance Agency’s Office of Inspector General, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), the Federal Reserve Board’s Office of Inspector General, the Recovery Accountability and Transparency Board, the Financial Crimes Enforcement Network, and more than ten state Attorneys General offices around the country.

For more information about the RMBS Working Group and the Financial Fraud Enforcement Task Force, please visit: www.stopfraud.gov.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANDREW MORRISON, also known as “Big Booby,” 25, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 66 months of imprisonment, followed by four years of supervised release, for his role in a Hartford-based narcotics trafficking ring.

According to court documents and statements made in court, this matter stems from a joint law enforcement investigation headed by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force and the Hartford Police Department into gang-related narcotics trafficking in Hartford’s South End.  The investigation specifically targeted a heroin and cocaine trafficking organization headed by Angel Rosa, also known as “Little” and “Daddy,” who is a member of the Los Solidos street gang, and his cousin, Angel Rosa, also known as “Mo Betta” and “Fab.”  “Little,” supervised the drug trafficking ring, which included several other family members, through fear and intimidation.  “Mo Betta” managed the daily operations of the organization, facilitated the delivery and transportation of large quantities of heroin, and supervised numerous drug sellers who distributed heroin and other narcotics in the Zion Street area.  At times, “Little” and “Mo Betta” used, or threatened to use, violence to ensure the success of the organization.

MORRISON was one of the principal heroin sellers in the Rosa drug trafficking organization.  In addition to working shifts selling substantial quantities of heroin in the Zion Street area, he sometimes brokered deals for heroin with his own source when Mo Betta and Little were having difficulty obtaining the drug from their principal suppliers.

MORRISON was arrested on April 17, 2013.  On January 31, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, heroin.

As a result of the investigation, 21 individuals were charged with various federal offenses, and law enforcement officers seized narcotics, one firearm, approximately $230,000 in cash, eight vehicles and jewelry.

Angel Rosa aka “Little” and Angel Rosa aka “Mo Betta” each pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, 100 grams or more of heroin.  On May 15, 2014, “Little” was sentenced to 235 months of imprisonment, and on April 29, 2014, “Mo Betta” was sentenced to 165 months of imprisonment.

This matter was investigated by the Federal Bureau of Investigation’s Northern Connecticut Violent Crimes Task Force, which includes members of the Connecticut State Police, Hartford Police Department, East Hartford Police Department, Connecticut Department of Correction and Connecticut National Guard.  The Connecticut State Police’s Emergency Services Unit, Hartford Police Department’s Emergency Response Team, Capital Region Emergency Response Team, Drug Enforcement Administration, Homeland Security Investigations and the New Britain, East Hartford, Wethersfield and Manchester Police Departments have provided valuable assistance to the investigation.

The case is being prosecuted by Assistant U.S. Attorneys Brian Leaming and Patrick Caruso.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that FRANCISCO R. CARBONE, 56, of Fairfield, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 24 months of imprisonment, followed by three years of supervised release, for his role in an insurance fraud scheme and a conspiracy to illegally distribute prescription narcotics.

This matter stems from “Operation Running Man,” a 14-month undercover fraud investigation headed by the Federal Bureau of Investigation.

According to court documents and statements made in court, CARBONE previously had been licensed to practice medicine, working as a sole practitioner in Bridgeport.  In March 2005, CARBONE’s license to practice medicine was revoked by the State of Connecticut.

Between December 2006 and February 2010, CARBONE conspired with attorney Joseph Haddad and Dr. Marc Kirshner, who owned and operated two chiropractor offices in Bridgeport and one in Stamford, to defraud several insurance companies by exaggerating the auto accident injuries of Haddad’s clients to justify a larger monetary settlement with the insurance companies.  As part of this scheme, the co-conspirators fabricated medical records, prescribed unnecessary pain medication, performed unnecessary chiropractic treatment, ordered and billed for diagnostic tests of questionable medical value, and overstated injuries or permanent partial disabilities that were allegedly caused by the accidents.

During the scheme, Haddad instructed his clients to see CARBONE, who both Haddad and Kirshner knew was an unlicensed doctor.  Because CARBONE had lost his license to practice medicine and was not permitted to prescribe pain medication, CARBONE enlisted James W. Marshall, Jr., a licensed doctor of osteopathic medicine in Monroe, to write prescriptions for oxycodone, hydrocodone and other narcotics, for CARBONE’s patients, even if the medication was not needed. 

CARBONE also fabricated medical records, including the clients’ injuries and medical condition, even though CARBONE had not done any medical examination on the vast majority of the patients.  The fabricated reports were given to Haddad who provided them to the insurance carriers in support of settlements.

CARBONE, at the request of Haddad and Kirshner, also referred clients to a diagnostic testing company owned by Kirshner to receive “Nerve Conduction Velocity” (NCV) testing, even though CARBONE had no prior knowledge of NCVs and did not rely on the test results for any medical purpose.  Kirshner’s office would submit a bill to Haddad in the amount of approximately $2000 for each NCV test that was performed, which would eventually be paid out of settlement proceeds.

In addition, CARBONE, Haddad and Kirshner engaged in a scheme to defraud the State of Connecticut.  By law, the state is entitled to 50 percent of the proceeds of a personal injury case if the individual who receives a settlement has been on public assistance, or has outstanding child support obligations.  Haddad provided fraudulent settlement statements to the state that inflated the payments to him, Kirshner and CARBONE, and reduced the net payout to the client.

CARBONE and Kirshner, at Haddad’s request, regularly kicked back a portion of their medical fees to Haddad’s clients.

More than 10 insurance carriers lost a total of more than $1.7 million as a result of this fraud scheme.

CARBONE was paid approximately $434,529 for participating in this scheme.  Today, he was ordered to pay restitution in that amount to the victim insurance carriers.

CARBONE was sentenced below the recommended sentencing guidelines range for cooperating during the investigation.

On July 19, 2011, CARBONE pleaded guilty to one count of conspiring to commit mail fraud to defraud insurance carriers, one count of conspiring to commit mail fraud to defraud the State of Connecticut, one count of making a false statement relating to health care matters, and one count of conspiring to distribute controlled substances outside the scope of the usual course of professional practice.

CARBONE’s criminal history includes federal convictions in 1999 for violating the Medicare/Medicaid anti-kickback statute and for filing a false federal tax return, for which he was sentenced to four months of imprisonment.  In 2002, CARBONE was sentenced to an additional 13 months of imprisonment for violating the conditions of his supervised release.

Haddad, Kirshner, Marshall and three other chiropractors pleaded guilty to charges stemming from this scheme.  On July 10, 2014, Haddad was sentenced to 51 months of imprisonment.  Kirshner and Marshall await sentencing.

This matter was investigated by the Federal Bureau of Investigation, with the assistance of the National Insurance Crime Bureau, the Metropolitan Property and Casualty Insurance’s Special Investigation Unit and the Travelers Insurance Company.

The case is being prosecuted by Assistant U.S. Attorneys Christopher W. Schmeisser and David J. Sheldon.

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The United States Attorney for the District of Connecticut today announced that THOMAS RAGONESE, 55, of Trumbull, pleaded guilty yesterday before U.S. Magistrate Judge Donna F. Martinez in Hartford to a federal tax offense stemming from a scheme to defraud a Bridgeport-based residential property owner.

According to court documents and statements made in court, Anthony Testo and business, ACT Builders, Inc., were contracted to serve as a property manager for an entity in Bridgeport that owned an apartment complex and several single and multi-family residences.  Testo’s role as property manager included filling vacant rental units, setting rental amounts, collecting security deposits, collecting rent from tenants and depositing rental payments in the property owner’s bank account.  Testo also was required to submit to the property owner a monthly “rent roll,” which was a spreadsheet showing the occupancy of the rental units, the rental amounts due and the rental payments collected from tenants.  RAGONESE provided accounting services to Testo and ACT Builders.  At Testo’s instruction, RAGONESE prepared the rent rolls.

From approximately January 2007 to August 2010, Testo and ACT Builders, with RAGONESE’s assistance, defrauded the property owner by submitting fraudulent rent rolls that misrepresented that certain rental units were vacant with no rent due when, in fact, the apartments were occupied and rent had been collected.  The rent rolls also misrepresented that the rent due and collected for certain rental units was lower than the amount that was actually collected.  Testo deposited rental income that was due to the property owner into both his personal bank account and the ACT Builders bank account.

Through this scheme, and also by submitting fraudulent subcontractor invoices to the property owner, Testo defrauded the defrauded the property owner of at least $275,000.

For the 2007 through 2010 tax years, RAGONESE prepared Testo’s federal tax returns, which failed to report the rental income that Testo kept for his own use and benefit.  This resulted in a tax loss to the Internal Revenue Service of $71,795.

RAGONESE pleaded guilty to one count of aiding and assisting the preparation and filing of a false tax return, an offense that carries a maximum term of imprisonment of three years.  He is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on October 2, 2014.

On June 20, 2014, Testo pleaded guilty to one count of conspiracy to commit wire fraud and one count of assisting in the preparation and filing of a false tax return.  Testo also admitted that he failed to report his fraudulent income on his 2007 through 2010 personal federal income tax returns.  In addition, Act Builders pleaded guilty to one count of conspiracy to commit wire fraud.

Testo and Act Builders are currently scheduled to be sentenced on September 2, 2014.

This matter is being investigated by the Federal Bureau of Investigation, and the Internal Revenue Service – Criminal Investigation Division.  The case is being prosecuted by Assistant U.S. Attorney Felice Duffy.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MICHAEL SMITH, also known as “Smitty” and “Fingers,” 44, of New Haven, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 120 months of imprisonment, followed by five years of supervised release, for distributing narcotics.

SMITH was charged as a result of “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven.  Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms.

On January 13, 2014, a jury found SMITH guilty of one count of conspiracy to possess with intent to distribute, and to distribute, cocaine and cocaine base (“crack cocaine”), and one count of possession with intent to distribute, and distribution of, cocaine base.

According to the evidence presented during his trial, investigators received court-authorization to monitor three of SMITH’s telephones.  The investigation revealed that SMITH conspired to receive and distribute large quantities of cocaine and crack cocaine.  In addition, on October 27, 2011, SMITH sold approximately 6.6 grams of crack cocaine to an individual working with law enforcement.

SMITH has been detained since his arrest on May 22, 2012.  On that date, law enforcement search an apartment connected to SMITH and recovered items used to convert cocaine into crack cocaine, as well as approximately $2000 in cash.

SMITH has a prior state firearms conviction, and seven prior felony drug convictions.

This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments.  The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments have provided valuable assistance to the investigation.

This case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Marc Silverman.

PUBLIC AFFAIRS CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury in Hartford has returned indictments against four Hartford residents allegedly involved in drug trafficking and associated criminal activity in the Garden Street area of Hartford known as the “Chicken Coop.”  The indictments were returned on July 16, 2014.

KEITH SHEPARD, also known as “Pretty,” 23, is charged with four counts of distributing crack cocaine and one count of possession of a firearm by a convicted felon.  The indictment alleges that on four occasions in June 2014, SHEPARD possessed and distributed crack cocaine.  The indictment further alleges that on June 20, 2014, SHEPARD, who previously had been convicted of multiple felony offenses, possessed a .380 caliber Taurus pistol.  He has been in custody since his arrest on June 23, 2014.

GARY PIERCE, also known as “GP,” 27, is charged with possession of a firearm by a convicted felon.  The indictment alleges that on May 11, 2014, PIERCE, who previously had been convicted of multiple felony offenses, possessed a .45 caliber Taurus pistol.  He has been in custody since his arrest on that date.

COURTNEY GRAVELY, also known as “Ceasar” and “Ceas,” 29, is charged with six counts of distributing crack cocaine and one count of possessing crack cocaine with intent to distribute it.  The indictment alleges that on six occasions in June and July 2014, GRAVELY possessed and distributed crack cocaine, and, on July 9, 2014, he possessed with intent to distribute crack cocaine.  He has been in custody since his arrest on July 9.

JAMES DUDLEY, also known as “Pooka,” 28, is charged with five counts of distributing crack cocaine, one count of maintaining a drug distribution premises, one count of being a felon in possession of firearms, and one count of possessing firearms in furtherance of drug trafficking crimes.  The indictment alleges that in June and July 2014, DUDLEY manufactured crack cocaine in an apartment at 2505 Main Street in Hartford, and then distributed the drug on multiple occasions.  The indictment further alleges that on July 9, 2014, DUDLEY, who previously had been convicted of multiple felony offenses, possessed a .380 caliber Taurus pistol and a .22 caliber Ruger rifle.  He has been in custody since his arrest on July 9.

This prosecution stems from Project Longevity, a comprehensive initiative to reduce gun violence in Connecticut’s major cities.  Through Project Longevity, community members and law enforcement directly engage with members of groups that are prone to commit violence. A critical component of the Project Longevity strategy is the “call-in,” a face-to-face meeting where Project Longevity partners engage group members and deliver a community message against violence, a law enforcement message about the consequences of further violence and an offer of help for those who want it.  The alleged criminal activity engaged in by the four defendants occurred after a call-in that was held on April 1, 2014, and was attended by associates of the defendants.

U.S. Attorney Daly stated that the investigation is ongoing.

The charge of possession with intent to distribute, and distribution of crack cocaine carries a maximum term of imprisonment of 20 years and a fine of up to $1 million.

With respect to the firearms counts, it is against federal law for a person previously convicted of a felony offense to possess a firearm that has moved in interstate or foreign commerce.  The charge of possession of a firearm by a previously convicted felon carries a maximum term of imprisonment of 10 years and a fine of up to $250,000.

DUDLEY faces an additional five-year consecutive term of incarceration if convicted of possessing firearms in furtherance of drug trafficking.  He also faces a maximum term of imprisonment of 20 years and a fine of up to $500,000 if convicted of maintaining a drug distribution premises.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the Hartford Police Department and the Federal Bureau of Investigation, and is being prosecuted by Assistant U.S. Attorney Michael J. Gustafson.

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WASHINGTON - A former senior executive of a subsidiary of Alstom SA, the French power and transportation company, pleaded guilty today for his participation in a scheme to pay bribes to foreign government officials.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Michael J. Gustafson of the District of Connecticut and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.

William Pomponi, a former vice president of regional sales at Alstom Power Inc., the Connecticut-based power subsidiary of Alstom, pleaded guilty today in federal court in New Haven, Connecticut, to a criminal information charging him with conspiracy to violate the Foreign Corrupt Practices Act (FCPA) in connection with the awarding of the Tarahan power project in Indonesia.  Pomponi was charged in a second superseding indictment on July 30, 2013.  Pomponi is the fourth defendant to plead guilty to charges stemming from this investigation.  Frederic Pierucci, the vice president of global boiler sales at Alstom, pleaded guilty on July 29, 2013, to one count of conspiracy to violate the FCPA and one count of violating the FCPA; and, David Rothschild, a former vice president of regional sales at Alstom Power Inc., pleaded guilty to conspiring to violate the FCPA on Nov. 2, 2012.  Marubeni Corporation, Alstom’s consortium partner on the Tarahan project, pleaded guilty on March 19, 2014, to one count of conspiracy to violate the FCPA and seven counts of violating the FCPA, and was sentenced to pay a criminal fine of $88 million.  FCPA and money laundering charges remain pending against Lawrence Hoskins, the former senior vice president for the Asia region for Alstom, and trial is scheduled for June 2, 2015.

“Three Alstom corporate executives and Marubeni, a major Japanese corporation, have now pleaded guilty to a seven-year scheme to pay bribes to Indonesian officials to secure a $118 million power contract,” said Assistant Attorney General Caldwell.  “The Criminal Division of the Department of Justice will follow evidence of corruption wherever it leads, including into corporate boardrooms and corner offices.  As this case demonstrates, we will hold both companies and their executives responsible for criminal conduct.” 

According to the court filings, the defendants, together with others, paid bribes to officials in Indonesia, including a member of the Indonesian Parliament and high-ranking members of Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia, in exchange for assistance in securing a $118 million contract, known as the Tarahan project, to provide power-related services for the citizens of Indonesia from facilities in Tarahan.  To conceal the bribes, the defendants retained two consultants purportedly to provide legitimate consulting services on behalf of Alstom and Marubeni in connection with the Tarahan project.  In reality, the primary purpose for hiring the consultants was to use the consultants to pay bribes to Indonesian officials.

The first consultant retained by the defendants allegedly received hundreds of thousands of dollars in his Maryland bank account to be used to bribe the member of Parliament.  The consultant then allegedly transferred the bribe money to a bank account in Indonesia for the benefit of the official.  According to court documents, emails between Hoskins, Pomponi, Pierucci, Rothschild, and their co-conspirators discuss in detail the use of the first consultant to funnel bribes to the member of Parliament and the influence that the member of Parliament could exert over the Tarahan project. 

However, in the fall of 2003, Hoskins, Pomponi, Pierucci and others determined that the first consultant was not effectively bribing key officials at PLN.  One email between Alstom employees described PLN officials’ “concern that if we have won the job, whether their rewards will still be satisfactory or this agent only give them pocket money and disappear.”  In another email, an employee at Alstom’s subsidiary in Indonesia sent an email to Hoskins asserting that the first consultant “has no grip on the PLN Tender team at all” and “is more or less similar to [a] cashier which I feel we pay too much.” 

As a result, the co-conspirators retained a second consultant to bribe PLN officials, according to the court documents.  The co-conspirators deviated from Alstom’s usual practice of paying consultants on a pro-rata basis in order to make a much larger up-front payment to the second consultant so that the consultant could “get the right influence.”  An employee at Alstom’s subsidiary in Indonesia sent an email to Hoskins, Pomponi, Pierucci and others asking them to finalize the consultancy agreement with the front-loaded payments but stated that in the meantime the employee would give his word to a high-level official at PLN, according to the charges.  The defendants and their co-conspirators were successful in securing the Tarahan project and subsequently made payments to the consultants for the purpose of bribing the Indonesian officials.

An indictment is merely an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad, with assistance from the Meriden, Connecticut, Resident Agency of the FBI.  Significant assistance was provided by the Criminal Division’s Office of International Affairs, and the department has also received substantial assistance from its law enforcement counterparts in Indonesia, Switzerland and Singapore and greatly appreciates their cooperation.  The case is being prosecuted by Assistant Chief Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David E. Novick of the District of Connecticut.

Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that JERRY GRUENBAUM, 59, of Woodbridge, waived his right to indictment and pleaded guilty yesterday before U.S. Magistrate Judge Thomas P. Smith in Hartford to failing to pay taxes on more than $1.3 million in income over a six-year period.

According to court documents and statements made in court, from 2005 to 2010, GRUENBAUM, an attorney, failed to report approximately $1,310,100 in taxable income on his federal tax returns.  For the 2005, 2006 and 2007 tax years, GRUENBAUM filed tax returns that he knew significantly understated his actual taxable income, and for the 2008, 2009 and 2010 tax years, he failed to file any tax returns.  Through this scheme, GRUENBAUM failed to pay $394,226 in additional tax due.

In pleading guilty, GRUENBAUM also admitted that he took steps to make it difficult for the IRS to determine his true income, including calculating the gross receipt figures for one of his businesses by reviewing just one of a number of the business’s bank accounts that he knew had reportable income.  He also utilized corporate bank accounts to pay his personal expenses, and received compensation for services rendered from at least three different corporations in the form of stock shares and salaries, and failed to report this income on his tax returns. 

GRUENBAUM pleaded guilty to two counts of filing a false federal tax return.  He faces a maximum term of imprisonment of six years when he is sentenced by U.S. District Judge Vanessa L. Bryant.

GRUENBAUM will also be required to pay approximately $877,646 in back taxes, penalties and interest.

This matter was investigated by the Internal Revenue Service – Criminal Investigation Division.  The case is being prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.   

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NEW HAVEN, Conn. – Two British nationals were sentenced today in New Haven federal court for conspiring to provide and providing material support to terrorists, including the solicitation of funds, personnel, and military equipment to the Taliban, at a time when they were harboring Usama bin Laden and Al Qaeda, and allowing them to have a base of operations in Afghanistan from which they could plan terrorist attacks directed at the United States.  Chief U.S. District Judge Janet C. Hall sentenced Babar Ahmad to 150 months of imprisonment, and Syed Talha Ahsan to approximately 96 months of imprisonment, time already served.  Ahmad, with Ahsan’s assistance, operated “Azzam Publications,” which maintained a then-pre-eminent series of websites through which the defendants provided extensive material support to terrorist groups, including the Taliban.

Today’s sentencing was announced by Deirdre M. Daly, United States Attorney for the District of Connecticut, John Carlin, Assistant Attorney General for National Security, Bruce Foucart, Special Agent in Charge of Homeland Security Investigations in Boston, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation.

“Babar Ahmad provided material support unprecedented in scope to terrorists for over seven years,” said U.S. Attorney Daly.  “Ahmad solicited funds, personnel and provided military equipment, training and expert advice in support of violent jihad in Afghanistan, knowing full well that his efforts could result in the killing of individuals, including U.S. forces.   This criminal conduct continued even after the tragedy of September 11, 2001.  I commend the dedicated investigators and members of our prosecution team who have worked tirelessly on this case for more than a decade.  Let this be a warning to those that support terrorism, the Government will not rest until you are brought to justice. We thank our law enforcement partners, including Homeland Security Investigations, the FBI, IRS-Criminal Investigation, DCIS, NCIS, and our counterparts in the United Kingdom, all of whom provided critical assistance in this investigation.”

“Today’s sentences prove once again that the United States doesn’t set a time limit on bringing supporters of terrorism to justice,” said John Carlin, Assistant Attorney General for National Security.  “We will remain tireless in our pursuit of those who provide material support to terrorists and promote violent extremism both here and abroad.”

“Today marks the culmination of a very long process,” said Bruce Foucart special agent in charge of HSI Boston. “This case began in the wake of the September 11th tragedy, and today, over a decade later these individuals have finally faced justice.  I would like to thank my special agents, the FBI and the brave men and women of the London Met for their dogged persistence over the years. Their steadfast support and perseverance throughout this process shows, that the best way to combat international terrorism is through international cooperation.”

“Terrorism comes in many shapes and sizes and, as this case demonstrates, so does the material and financial support of terrorism,” said FBI Special Agent in Charge Ferrick.   “We must remain ever vigilant of those like Ahmad who discreetly support radicals committed to violent jihad, not only through financial networking, but also through the supply of personnel, military equipment and intelligence.  Ahmad’s crimes were a serious threat to the United States and to the world.  It is critically important that the FBI, Homeland Security Investigations and all of our federal partners remain steadfast in the war on terror and those who support it.”

According to court documents and statements made in court, Ahmad was a member of a group that supported the Taliban through various means, including the operation of a series of websites under the name of “Azzam Publications,” including Azzam.com and Qoqaz.net, which promoted violent jihad and solicited support for such groups.  Azzam Publications posted articles on how to train for and support the jihad and the mujahideen, posted biographies of “martyrs,” and also produced and/or sold a number of audio and video products that were advertised on the websites, including videos containing real combat footage and biographies and images of deceased mujahideen. 

While the websites were in operation, the Taliban allowed territory under its control in Afghanistan to be used as a safe haven and base of operations for Usama bin Laden and Al Qaeda, who had committed and threatened to continue to commit acts of violence against the U.S. and its nationals, including the 1998 bombings of U.S. Embassies in Africa, the October 2000 attack on the U.S.S. Cole, and the terrorist attacks of September 11, 2001.  For a period of time, the Azzam websites were made possible through the unwitting services of a web-hosting company headquartered in Trumbull, Conn. 

Ahmad conspired with others to provide material support for terrorism through Azzam.com by soliciting and conspiring to provide funds and military equipment, and by facilitating the travel of individuals to attend training camps in Afghanistan.  Ahmad’s efforts were intended to support the Taliban regime in Afghanistan, and were done knowing that such support would be used in preparation for or in carrying out a conspiracy to commit murder, kidnaping, or maiming, and a conspiracy to kill nationals of the U.S. while such nationals were outside the U.S.

Ahmad has admitted that he operated the family of websites collectively known as Azzam Publications, and that “the purpose of Azzam Publications [was] to ‘Incite the believers’ and also secondly to raise some money for the brothers.” 

In 2001, Azzam Publications also posted on its websites an article entitled “What You Can Do to Help the Taliban,” which provided detailed instructions on how to raise, transport and personally deliver amounts over US$ 20,000 in cash to the Taliban government via its consulate in Pakistan.  Azzam Publications solicited personnel and physical items, including military suits and gas masks, for the Taliban.  This solicitation appeared on the Azzam websites following Usama bin Laden and Al Qaeda’s having claimed responsibility for the October 2000 attack on the U.S.S. Cole, and was intended to assist the Taliban defend against a claimed forthcoming attack by the United States in retaliation for Al Qaeda’s attack on the U.S.S. Cole.  

Ahmad and Azzam Publications’ support continued even after September 11, 2001, when U.S. forces were actively fighting Taliban and Al Qaeda forces in Afghanistan, and after Usama bin Laden and Al Qaeda had claimed responsibility for the September 11th attacks.  For example, from at least the fall of 2001 through mid-2002, Ahmad and the Azzam sites posted an “Appeal to Pakistanis All over the World,” which, post-9/11, encouraged Pakistanis worldwide to travel to and fight against “the Crusaders” in Afghanistan, and provided detailed instructions for Pakistani nationals to obtain a Pakistani visa under false pretenses.  On a linked page discussing the fighting in Afghanistan, the Azzam site also posted a bar graph comparing casualties at the World Trade Center with casualties in Afghanistan.  Moreover, a search of Babar Ahmad’s computer media from his office at Imperial College in London recovered a previously deleted document from December 2001 that discussed safe routes into and out of Afghanistan, the need for fighters, the provision of funds and night vision systems, and providing detailed information on U.S. casualties for circulation on the Azzam sites. 

In December 2003, a search of Ahmad’s residence in the United Kingdom revealed that Ahmad was in possession of an electronic document setting forth previously classified plans regarding the makeup, advance movements, and mission of a U.S. naval battle group as it was to travel from California to its deployment in the Middle East.  The document discussed the battle group’s perceived vulnerability to terrorist attack.  Forensic analysis revealed that Syed Talha Ahsan created the electronic version of the battle group document, carefully altered the metadata to hide his authorship, and then delivered the material to Ahmad. 

Ahmad, 40, has been detained since his arrest by British law enforcement authorities on August 5, 2004, and he was indicted in October 2004.  Ahsan, 34, was indicted in June 2006, and has been detained since his arrest by British authorities on July 19, 2006.  Following lengthy extradition proceedings, Ahmad and Ahsan were extradited to Connecticut in October 2012.  On December 10, 2013, each pleaded guilty to one count of conspiracy to provide material support to terrorists and one count of providing material support to terrorists. 

At the time of their pleas, Ahmad and Ahsan specifically agreed, in writing, that they pleaded guilty freely and voluntarily, and without intimidation or coercion of any kind, because they are guilty of conspiring to provide and providing material support to terrorists.

This case was investigated by a Task Force in Connecticut consisting of Special Agents from Homeland Security Investigations; law enforcement agents from the Federal Bureau of Investigation’s Joint Terrorism Task Force; the Internal Revenue Service – Criminal Investigation Division, Electronic Crimes Program; the Defense Criminal Investigative Service and the Naval Criminal Investigative Service.

U.S. Attorney Daly praised the substantial efforts of law enforcement authorities from the Metropolitan Police Service’s Counter Terrorism Command and the Extradition Unit, both within New Scotland Yard, whose efforts and assistance have been essential in the investigation in this case.   She also thanked HSI, the FBI, the U.S. Marshals Service, and Justice Department attachés in London for their assistance in the matter.

The case is being prosecuted by a team of federal prosecutors including Assistant U.S. Attorneys Stephen Reynolds and Ray Miller from the U.S. Attorney’s Office for the District of Connecticut, and Trial Attorney Alexis Collins from the Counterterrorism Section of the Justice Department’s National Security Division.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that CARLOS PADILLA, 29, a citizen of the Dominican Republic last residing in the Bronx, N.Y., was sentenced yesterday by Senior U.S. District Judge Warren W. Eginton in Bridgeport to 84 months of imprisonment for trafficking heroin.

According to court documents and statements made in court, on February 11, 2012, the Drug Enforcement Administration and Connecticut State Police stopped a vehicle PADILLA was driving on I-95 North in East Haven.  After PADILLA gave his consent, law enforcement officers searched the car and found approximately 1.1 kilograms of heroin secreted inside a “trap” that had been installed in the car.  PADILLA and a passenger, Francisco Torres, were arrested at that time.  The investigation revealed that PADILLA and Torres were transporting the heroin from New York to Rhode Island.

On February 26, 2014, PADILLA pleaded guilty to one count of possession with intent to distribute heroin.

Torres, also a citizen of the Dominican Republic, previously pleaded guilty to one count possession with intent to distribute one kilogram or more of heroin, and one count of unlawful reentry of a removed alien.  On April 15, 2014, he was sentenced to 130 months of imprisonment.

Torres’ criminal history includes a 2004 murder conviction in Rhode Island state court.  In July 2010, he was deported to the Dominican Republic.  He subsequently illegally reentered the United States.

This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force and the Connecticut State Police.  The case was prosecuted by Assistant U.S. Attorney Rahul Kale.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANTHONY HARRINGTON, also known as “Tone,” 29, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 60 months of imprisonment, followed by four years of supervised release, for his role in a narcotics trafficking ring.

This matter stems from a joint law enforcement investigation headed by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) into a narcotics trafficking operation headed by Luther Nance, also known as “Papers” and “Cash.”  The investigation, which included numerous controlled purchases of narcotics and physical surveillance, revealed that Nance and his associates sold crack cocaine and heroin in several communities throughout Connecticut utilizing multiple bases of operation, including a house on Carroll Road in East Hartford, the Sheldon Oaks housing complex in Hartford and an apartment on Valley Street in Willimantic.

According to court documents and statements made in court, HARRINGTON obtained crack cocaine from other members of the conspiracy, supplied the drug to other dealers and also sold it to his own customers in the Hartford area and in Providence, R.I.

On June 27, 2013, a federal grand jury returned a 51-count superseding indictment charging HARRINGTON, Nance and 13 other individuals with narcotics conspiracy and related offenses.

HARRINGTON has been detained since his arrest on June 13, 2013.  On March 27, 2014, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 28 grams or more of cocaine base (“crack cocaine”).

HARRINGTON’s criminal history includes multiple felony convictions in Connecticut and Rhode Island.
On March 7, 2014, Nance pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute 280 grams or more of cocaine base, and one count of conspiracy to engage in money laundering.  He is detained while awaiting sentencing.

This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the Internal Revenue Service – Criminal Investigation Division, the U.S. Marshals Service, the Office of the Chief State’s Attorney, the State’s Attorney for the Judicial District of Hartford, and the Hartford, Willimantic, East Hartford, Enfield and Middletown Police Departments.

The case is being prosecuted by Assistant U.S. Attorney Geoffrey M. Stone.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that GIOVANNI MASUCCI, also known as John Masucci, 46, of Woodbridge, was arrested yesterday on an indictment that charges him with defrauding a Connecticut company of more than $1 million.

MASUCCI appeared today before U.S. Magistrate Judge William I. Garfinkel in Bridgeport, entered a plea of not guilty and was ordered detained pending a hearing that is scheduled for July 17.

According to the indictment, MASUCCI operated a financial consulting business in North Haven.  As part of his business, he provided financial consulting services to a company located in Milford and had access to the company’s checkbooks and financial ledgers.  From approximately July 2011 to May 2014, it is alleged that MASUCCI defrauded the Milford company by diverting company funds to his own bank account.  He then used the funds to pay personal expenses, including travel and lodging expenses, and purchases at several high-end retailers.  It is further alleged that MASUCCI created false entries in the corporate check ledger that falsely indicated the checks were written for legitimate business purposes.  MASUCCI would typically forge the signature of the authorized company representative on the check. 

On July 9, 2014, a federal grand jury sitting in New Haven returned an indictment charging MASUCCI with four counts of wire fraud and three counts of mail fraud.  Each charge carries a maximum term of imprisonment of 20 years and a fine of up to $250,000.

U.S. Attorney Daly stressed that an indictment is only a charge and is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the Connecticut Financial Crimes Task Force, the United States Secret Service and the Greenwich Police Department.  The case is being prosecuted by Assistant U.S. Attorney Ray Miller.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANTHONY PATTERSON, 35, of Bridgeport, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 60 months of imprisonment, followed by three years of supervised release, for illegally possessing a firearm.

According to court documents and statements made in court, on November 13, 2012, a Connecticut State Police trooper stopped a rental car being driven by PATTERSON on I-95 South.  When the trooper approached the vehicle, PATTERSON informed him that he was on parole for conspiracy to commit murder and that he was driving without a license.  The trooper instructed PATTERSON to exit the vehicle, searched him and recovered a loaded .380 caliber handgun from PATTERSON’s waistband.

PATTERSON has been detained in state custody since his arrest.  On March 19, 2014, he pleaded guilty to one count of possession of a firearm by a previously convicted felon.

This is PATTERSON’s fifth felony conviction, including a conviction for conspiracy to commit murder.  In November 2001, a 32-year-old man was shot seven times and killed by PATTERSON’s accomplices at the Roodner Court housing complex in Norwalk after PATTERSON had lured the victim out of an apartment.

This matter was investigated by the Connecticut State Police, Norwalk Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.  The case was prosecuted by Assistant U.S. Attorney Vanessa Richards.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JOSEPH LUCA, 68, of Meriden, waived his right to indictment and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to federal theft and tax offenses.

According to court documents and statements made in court, in April 1993, LUCA applied for Social Security Disability Insurance (“SSDI”) claiming that he was disabled and unable to work.  From January 2002 through April 2011, LUCA regularly reported to the Social Security Administration, under the penalty of perjury, that he remained unable to work and he reported no earned income.  In fact, during this time, LUCA earned more than $1,000 per month from his work as a hairdresser at a beauty salon he owned and operated.  LUCA was not entitled to SSDI payments during this entire period because his earnings exceeded the SSA monthly substantial gainful activity limit.

An undercover investigation revealed that LUCA typically opened his beauty salon in the morning from Tuesday to Saturday each week, cut and styled his clients’ hair throughout the day in exchange for payment, and then locked up the salon at night.  Throughout the day, he stood while he worked without the assistance of a cane or similar device, and also carried and lifted items using his body and arms.  During the investigation, LUCA told an undercover agent who was posing as a client that he had been styling hair for 45 years.

Based on LUCA’s false representations that he was disabled, unable to work, and reported no income, the Social Security Administration paid him, as well as his children as auxiliary beneficiaries, a total of $122,332 that he and his children were not entitled to receive.

In May 2011, the Social Security Administration terminated LUCA’s SSDI benefit payments.

LUCA also willfully signed and filed federal tax returns for the 2006 through 2009 tax years that failed to report a total of more $675,000 in additional taxable income.  On each of these four tax returns, LUCA reported a loss and no tax due.  The investigation determined that LUCA did not report his receipt of income from various sources, including rental real estate, work as a private investigator, interest on bank accounts, SSDI payments he was not entitled to receive, and capital gains on rental properties. 

On his 2006 federal tax return alone, LUCA failed to report approximately $299,674 in additional income, with a tax due in the amount of $36,687.

LUCA pleaded guilty to one count of stealing government money and one count of filing a false federal tax return.  Judge Shea scheduled sentencing for October 3, 2014, at which time LUCA faces a maximum term of imprisonment of 13 years and a fine of up to $500,000.

In addition, LUCA also has agreed to pay $122,332 in restitution to the Social Security Administration, and $64,093 in back taxes, plus penalties and interest.

LUCA was released pending sentencing.

This matter was investigated by the Internal Revenue Service – Criminal Investigation Division, and the Social Security Administration, Office of Inspector General – Office of Investigations.  The case is being prosecuted by Assistant U.S. Attorney Peter S. Jongbloed with the assistance of Law Student Intern Owen Firestone.  

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JORDANO PERDOMO, 20, of Danbury, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 30 months of imprisonment, followed by three years of supervised release, for his participation in two Danbury-area violent home invasion robberies of illegal drugs and drug trafficking proceeds.

According to court documents and statements made in court, in January 2013 the Danbury Police Department began investigating a narcotics trafficking network that maintained a series of drug distribution locations, known as trap houses, in Danbury, out of which members of the organization sold crack and heroin.  The organization also rented hotel rooms where they packaged and distributed narcotics.  During the investigation, law enforcement learned that the individuals who headed the drug trafficking ring had organized and committed armed home invasion robberies of marijuana dealers.

PERDOMO participated in home invasion robberies on January 30 and February 14, 2013.  During both of these robberies, and a third in which PERDOMO did not participate, several men wearing masks and armed with firearms forced entry into the residence of a known marijuana dealer.  Once inside, the perpetrators attempted to or did steal marijuana and cash.  In each instance, the perpetrators pistol whipped a victim and threatened to kill others within the home.

PERDOMO brandished a BB gun during both of the robberies in which he participated.  During the robbery on February 14, PERDOMO held a woman at gunpoint in her bedroom and threatened to harm her if she called the police.

PERDOMO has been detained since his arrest on October 23, 2013.  On March 20, 2014, he pleaded guilty to one count of interference with commerce by robbery and one count of attempted interference with commerce by robbery.

The U.S. Attorney’s Office advocated for a sentence within the federal sentencing guidelines range of 70 to 87 months of imprisonment.

This matter is being investigated by the Drug Enforcement Administration’s New Haven Task Force and the Danbury Police Department.  The DEA Task Force includes personnel from the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments.  The case is being prosecuted by Assistant U.S. Attorneys Tracy Dayton and Vanessa Richards.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that FEDERICO CANNON, also known as “Rico,” 31, of Bridgeport, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 70 months of imprisonment, followed by three years of supervised release.  On May 22, 2013, a jury found CANNON guilty of one count of possession of a firearm and ammunition by a previously convicted felon.

According to the trial evidence, at approximately 1:15 a.m. on February 25, 2012, Bridgeport Police stopped a vehicle in which CANNON was a passenger on Caroline Street in Bridgeport.  CANNON initially exited the vehicle and attempted to walk away, but police ordered him back into the car.  After directing the driver out of the vehicle, a Bridgeport Police detective observed a semi-automatic pistol on the floor of the rear passenger area in the vicinity of where CANNON was sitting.  The firearm was a Smith & Wesson 9mm model 469, loaded with 10 live hollow-point cartridges and two full-metal jacket cartridges.

Prior to February 25, 2012, CANNON had sustained felony drug, firearms and burglary convictions, including a 2006 federal conviction for possession of a firearm and ammunition by a previously convicted felon.

The evidence at trial in the previous federal case revealed that in the early morning hours of October 21, 2004, CANNON was in a car with three other individuals driving northbound on Interstate 95 between Norwalk and Bridgeport when they initiated a confrontation with another car occupied by two men.  The confrontation culminated at the bottom of the Exit 25 ramp in Bridgeport when approximately seven or eight shots were fired at the victims’ vehicle.  A subsequent search of the vehicle in which CANNON was a passenger revealed a semi-automatic pistol at CANNON’s feet in the right rear passenger seat of the vehicle.  The jury found CANNON guilty and, on April 12, 2006, he was sentenced to 42 months of imprisonment.

This matter was investigated by the Bridgeport Police Department and the Federal Bureau of Investigation, with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives.  The case was prosecuted by Assistant U.S. Attorney Rahul Kale.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that DOMINICK RIBUSTELLO, 53, of the Bronx, N.Y., was sentenced yesterday by Senior U.S. District Judge Warren W. Eginton in Bridgeport to 18 months of imprisonment, followed by three years of supervised release, for trafficking cocaine.

This matter stems from a year-long investigation headed by the DEA’s Bridgeport High Intensity Drug Trafficking Area Task Force and Norwalk Police Department into the distribution of oxycodone, cocaine and marijuana in Fairfield County.  Sixteen individuals were charged and convicted as a result of this investigation.

According to court documents and statements made in court, RIBUSTELLO regularly supplied distribution quantities of cocaine to co-defendants Alfred Catino of Danbury and Konstantinos Zografidis of Norwalk.

RIBUSTELLO was arrested on June 5, 2012.  On March 18, 2014, he pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, cocaine.

Catino and Zografidis have pleaded guilty and await sentencing.

This matter was investigated by the DEA’s Bridgeport High Intensity Drug Trafficking Area Task Force and the Norwalk Police Department, with assistance provided by the Connecticut State Police and the Bridgeport, Stamford, Stratford and Westport Police Departments.  The case is being prosecuted Assistant U.S. Attorneys Vanessa Richards and Michael Runowicz.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MICHELLE LAUDATO, 36, of Farmington, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 12 months and one day of imprisonment, followed by three years of supervised release for stealing money from CD accounts at a bank where she was employed.

According to court documents and statements made in court, between July 2009 and June 2010, LAUDATO used her position as a teller supervisor at a branch of Webster Bank in Bristol to steal a total of $178,710.89 from the CD accounts of at least 18 bank customers.  Thirteen of the 18 bank customers were between the ages of 79 and 99.

As part of the scheme, LAUDATO sometimes withdrew funds from certain CD accounts to replace funds in the CD accounts she had previously accessed.  She also withdrew funds in increments of $10,000 or less to avoid currency transaction reporting requirements.

LAUDATO was ordered to pay full restitution to Webster Bank.  In addition, Judge Thompson ordered LAUDATO to perform 100 hours of community service during her term of supervised release, in activities that specifically benefit the elderly.

On June 18, 2013, LAUDATO pleaded guilty to one count of bank fraud.

LAUDATO, who recently gave birth to a child, was ordered to report to prison on February 25, 2015.

This matter was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Felice M. Duffy.   

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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that JOSEPH P. HADDAD, 65, of Orange, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 51 months of imprisonment, followed by three years of supervised release, for his role in an extensive insurance fraud scheme.  He was also ordered to pay a fine of $25,000.

This matter stems from “Operation Running Man,” a 14-month undercover fraud investigation headed by the Federal Bureau of Investigation.  The investigation included the use of recordings of an undercover special agent meeting with HADDAD, various doctors and chiropractors in relation to auto-accident personal injury litigation.

According to court documents, statements made in court and the admissions of his co-conspirators, HADDAD, a Bridgeport-based personal injury attorney, conspired with chiropractors and others to defraud several insurance companies by exaggerating the auto accident injuries of HADDAD’s clients, and the cost of their medical care, to justify larger monetary settlements with the insurance companies.  As part of the scheme, the co-conspirators fabricated medical records, prescribed unnecessary pain medication, performed unnecessary chiropractic treatment, ordered and billed for diagnostic tests of questionable medical value, and overstated injuries or permanent partial disabilities that were allegedly caused by the accidents.

“Over the course of years and in hundreds of cases, this corrupt attorney used his law license as a license to steal from insurance carriers,” stated U.S. Attorney Daly.  “Driven by greed, he illegally used runners to find highly questionable personal injury cases, convinced his clients to overstate treatment needs to inflate medical costs, pushed for doctors’ reports that falsely claimed permanent injury, all the while aware that his clients were improperly receiving prescriptions for narcotics to make them seem more injured than they actually were.  Through this scheme, Haddad and he cohorts bilked insurance companies of over $1.7 million dollars.  His crime both damages the reputation of all legal and medical professionals and inflates the cost of insurance for all of us.  I commend the FBI for their excellent work during this undercover investigation.”

“For years, Attorney Haddad operated a well-oiled fraud machine designed to bilk millions of dollars from automobile insurance companies,” stated FBI Special Agent in Charge Ferrick.  “Today, he learned that his long-running scheme has earned him 51 months in federal prison.  Lawyers, doctors, chiropractors and other licensed health care professionals can earn substantial incomes without having to steal.  Sadly, the criminal conduct of Haddad and the other defendants in Operation Running Man not only causes a loss of trust in lawyers and doctors, but also much higher insurance premiums for us all.  As covert investigations like Operation Running Man suggest, the FBI and the U.S. Attorney’s Office are fully committed to investigating and prosecuting licensed professionals who commit similar frauds.”

Between December 2006 and February 2010, HADDAD conspired in the scheme with Francisco R. Carbone, who had been licensed to practice medicine until his license was revoked by the State of Connecticut in March 2005, and with Dr. Marc Kirshner, who owned and operated two chiropractor offices in Bridgeport and one in Stamford.

As part of the scheme, HADDAD paid “runners” to locate and deliver to him clients for his personal injury practice.  Because state law barred attorneys from hiring runners in personal injury cases, HADDAD attempted to hide this practice by paying the runners in cash.  Dr. Kirshner regularly met with HADDAD to provide him with thousands of dollars in cash and, in return, HADDAD reimbursed Kirshner with checks written from his business account.  HADDAD often included on the checks false memo lines suggesting that the checks were for medical expenses incurred by his clients.  During the course of the conspiracy, Kirshner gave HADDAD more than $100,000 in cash.  HADDAD also paid runners with checks directly from his client trust account, often disguising these payments as “independent investigative services.”

HADDAD regularly instructed clients to see Carbone for purported medical treatment, even though HADDAD was aware that Carbone had lost his medical license.  Carbone provided HADDAD’s clients with prescription pain medication, even if the medication was not needed and, in reports, fabricated the clients’ injuries, medical conditions and permanent partial disability ratings.  In multiple instances, Carbone did no medical examination at all.  Carbone billed the victim insurance carriers in his name or in the name of another physician for services he allegedly rendered, and provided prescriptions, bills, medical reports and final reports to HADDAD, who submitted the documents to the victim carriers to support requests for settlement.

HADDAD also referred clients to Dr. Kirshner’s Bridgeport chiropractor offices, which operated under the name Health First Medical, P.C.  Kirshner often permitted HADDAD to influence the course of patients’ medical treatments by acquiescing to HADDAD’s instructions that a patient receive more treatment and diagnostic tests despite the questionable need for both.  Kirshner and other chiropractors at Health First, including Jennifer Netter, established a protocol to treat patients in HADDAD’s cases for six months, regardless of medical need, and would not resolve treatment of patients unless instructed to do so by HADDAD.  Netter and others at Health First often falsified medical records by indicating that they had examined the patients when they had not, and by misrepresenting that patients’ pain complaints and other symptoms continued.  After the six-month period, each patient would receive a permanent partial disability rating, regardless of the permanence of the medical condition.  If a patient had received a permanency rating for a prior accident, the protocol was to give a higher or different disability rating for the present accident.

Kirshner also owned a diagnostic testing company, Midas Medical LLC, and instructed his employees to conduct Nerve Conduction Velocity (NCV) tests whenever a patient’s symptoms could potentially implicate testing, even though he knew the test results would not change the course of treatment.  HADDAD and Kirshner arranged for Carbone to order the tests, believing that, if ordered by a doctor, the tests would be given greater weight by the victim insurance companies and increase the likelihood of higher settlement payments.  HADDAD summoned at least one chiropractor to his office so that Kirshner could explain that the chiropractor would receive a kickback of several hundred dollars for each referral of HADDAD’s clients for NCV testing.  Kirshner’s office would provide to HADDAD a bill of approximately $2,000 for each NCV test, and HADDAD would submit the bills to the victim carriers as part of settlement discussions.

More than 10 insurance carriers lost a total of more than $1.7 million as a result of this fraud scheme.  Judge Underhill ordered HADDAD to pay restitution in the amount of $1,758,368.

HADDAD was ordered to report to prison on September 24, 2014.

On January 3, 2014, HADDAD pleaded guilty to one count of conspiracy to commit mail fraud and one count of mail fraud.  After his guilty plea, he resigned from the practice of law.

Carbone, Kirshner, Netter, two other chiropractors and a licensed doctor of osteopathic medicine also pleaded guilty to charges stemming from this scheme.  On July 9, 2014, Netter was sentenced to two years of probation and ordered to perform 100 hours of community service.  Carbone and Kirshner await sentencing.

This matter is being investigated by the Federal Bureau of Investigation, with the assistance of the National Insurance Crime Bureau, the Metropolitan Property and Casualty Insurance’s Special Investigation Unit and the Travelers Insurance Company.

The case is being prosecuted by Assistant U.S. Attorneys Christopher W. Schmeisser and David J. Sheldon.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that IULIAN SCHIOPU, 34, of Romania, was sentenced yesterday by Chief U.S. District Judge Janet C. Hall in New Haven to 45 months of imprisonment for his role in an extensive Internet “phishing” scheme.

A phishing scheme uses the Internet to target large numbers of unwary individuals, using fraud and deceit to obtain private personal and financial information such as names, addresses, bank account numbers, credit card numbers and Social Security numbers.  Phishing schemes often work by sending out large numbers of counterfeit e-mail messages that are made to appear as if they originated from legitimate banks, financial institutions or other companies.  The fraudulent email messages ask individuals to click on a hyperlink contained in the email message, which would take the individual to a counterfeit site on the Internet that purports to be the Internet site of the particular bank, financial institution or company.  At the counterfeit Internet site, the individual is then asked to enter information such as the individual’s name, address and credit or debit card numbers.

According to court documents and statements made in court, in June 2005 a resident of Madison, Conn., contacted the FBI in New Haven about a suspicious email that she had received that purported to be from Connecticut-based People’s Bank.  The email stated that the recipient’s online banking access profile had been locked and instructed the recipient to click on a link to a web page where the recipient could enter information to “unlock” his or her profile.  The web page appeared to originate from People’s Bank, but, as the investigation revealed, was actually hosted on a compromised computer in Minnesota.  Any personal identifying and financial information provided by the individual would be sent by email to individuals in Romania, or to a “collector” account, which was an email account used to receive and collect the information obtained through phishing.

SCHIOPU and others were part of a loose-knit conspiracy of individuals from Craiova, Romania, and neighboring areas that shared files, tools, and stolen information obtained through phishing.  The co-conspirators used and shared a number of collector accounts, which contained thousands of email messages that contained credit or debit card numbers, expiration dates, CVV codes, PIN numbers, and other personal identification information such as names, addresses, telephone numbers, dates of birth, and Social Security numbers.  The co-conspirators then used the personal and financial information to access bank accounts and lines of credit and to withdraw funds without authorization, often from ATMs in Romania.

In addition to People’s Bank, financial institutions and companies targeted by the defendants included Citibank, Capital One, Bank of America, JPMorgan Chase & Co., Comerica Bank, Regions Bank, LaSalle Bank, U.S. Bank, Wells Fargo & Co., eBay and PayPal.

SCHIOPU was arrested in Sweden on May 7, 2013, and was extradited to the U.S. on September 12, 2013.

This investigation, which resulted in criminal charges against 19 Romanian citizens, was conducted by the Federal Bureau of Investigation in New Haven, Conn.

U.S. Attorney Daly acknowledged the critical assistance provided by the U.S. Department of Justice Office of International Affairs, the FBI Legal Attaché in Bucharest, Interpol, the Romanian National Police and the United States Marshals Service.

The case was prosecuted by Assistant U.S. Attorneys Edward Chang and Sarala Nagala.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Bruce M. Foucart, Special Agent in Charge of Homeland Security Investigations in New England, announced that a federal grand jury in Hartford returned an indictment today charging JOSEPH RAJKUMAR, 44, formerly of Farmington, with one count of use an interstate facility to persuade a minor to engage in sexual activity.  The charge stems from RAJKUMAR’s sexual relationship with a student while he was a teacher at Miss Porter’s School in Farmington. 

The indictment alleges that, in approximately November 2011, RAJKUMAR used a computer connected to the Internet to entice a minor who had not reached the age of 18 to engage in sexual activity for which any person could be charged with a criminal offense.

If convicted of the charge, RAJKUMAR faces a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life.

RAJKUMAR previously pleaded guilty in state court to sexual assault in the second degree and, in January 2014, was sentenced to 10 years of incarceration, execution suspended after 18 months, and 10 years of probation.  He is currently in state custody.

This matter is being investigated by Homeland Security Investigations with the assistance of the Farmington Police Department.  The case is being prosecuted by Assistant U.S. Attorney Sarala V. Nagala

U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that two West Haven residents involved in a cocaine distribution conspiracy were sentenced yesterday in Hartford federal court.  U.S. District Judge Alvin W. Thompson sentenced HERNAN VARON-RAMIREZ, also known as “Carlos,” 44, to 60 months of imprisonment and four years of supervised release, and RODRIGO ROMAN, also known as “Bobby,” 41, to approximately 25 months of imprisonment, time already served, and four years of supervised release.

This matter stems from a Drug Enforcement Administration New Haven Task Force investigation that targeted a cocaine distribution organization that was headed by VARON-RAMIIREZ and his associates.  The investigation employed several law-enforcement techniques, including the use of confidential informants, controlled purchases of cocaine, physical surveillance and the use of court-authorized wiretaps on cellular telephones utilized by members of the conspiracy.

The investigation revealed that VARON-RAMIREZ, ROMAN and others obtained large quantities of cocaine from sources of supply in the New Haven area and distributed it to drug sellers in and around New Haven.  Michael Smith, also known as “Smitty” and “Fingers,” of Hamden, was one of VARON-RAMIREZ’s cocaine customers.  Smith converted the cocaine to crack cocaine, which he sold to his own customer base.

VARON-RAMIREZ and ROMAN, who have been detained since May 22, 2012, each previously pleaded guilty to one count of conspiracy to distribute, and to possess with intent to distribute, cocaine.

Following service of his sentence, VARON-RAMIREZ faces deportation to Colombia.

On January 13, 2014, a federal jury in Hartford found Smith guilty of one count of conspiracy to distribute, and to possess with intent to distribute, cocaine and cocaine base (“crack cocaine”), and one count of possession with intent to distribute, and distribution of, cocaine base.  He awaits sentencing.

This matter was investigated by the Drug Enforcement Administration’s New Haven Task Force, including the U.S. Marshals Service and the New Haven, Hamden, West Haven, Branford, Ansonia and Meriden Police Departments.  The case is being prosecuted by Assistant U.S. Attorney H. Gordon Hall.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JOSE DE LA CRUZ AJQUI, 27, a citizen of Guatemala last residing in Willimantic, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 12 months of imprisonment for illegally reentering the U.S. after he was deported.

According to court documents and statements made in court, DE LA CRUZ AJQUI entered the U.S. illegally in 2005 and settled in Willimantic.  In September 2007, he was charged and subsequently convicted in Connecticut state court of sexual assault of a minor in the second degree.  DE LA CRUZ AJQUI received a sentence of five years of incarceration execution, suspended after nine months, and 10 years of probation.  He was also required to register as a sex offender for a period of 10 years.

DE LA CRUZ AJQUI was deported to Guatemala in May 2009.  By his own admission, he illegally reentered the U.S. less than two months later and returned to Willimantic. 

On October 7, 2011, DE LA CRUZ AJQUI was arrested by the Connecticut State Police in Woodstock for evading responsibility, operating a motor vehicle while under the influence of alcohol, and illegally operating a motor vehicle.  He also was found in possession of marijuana.  However, DE LA CRUZ AJQUI provided a false identity at the time of this arrest.  His illegal presence in the country was not detected in until May 7, 2013, when he was arrested by the Willimantic Police Department for failing to appear on the charges and his true identity was determined.  On December 6, 2013, he was sentenced in state court to five years of incarceration, execution suspended after one year, with 10 years of probation for violating his probation.

On March 25, 2014, DE LA CRUZ AJQUI pleaded guilty in federal court to one count of illegal reentry of a removed alien.

This matter was investigated by U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations.  The case was prosecuted by Assistant U.S. Attorney Deborah R. Slater.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, John K. Gauthier, Acting Special Agent in Charge of EPA’s Criminal Investigation Division for New England, and Commissioner Robert Klee of the Connecticut Department of Energy and Environmental Protection announced that THOMAS H. FARIA, 37, the former chief executive officer and president of Faria Limited, LLC, doing business as Sheffield Pharmaceuticals, waived his right to indictment and pleaded guilty today before U.S. District Judge Alvin W. Thompson in Hartford to a felony violation of the Clean Water Act.  As a condition of his guilty plea, FARIA resigned from the company on March 7, 2014, and shall have no role in the operations or management of Faria Limited.

“Any CEO operating a factory in Connecticut who ignores federal and state environmental laws risks not only significant fines, but also a jail sentence,” said U.S. Attorney Daly.  “The Clean Water Act applies to every industrial entity doing business in Connecticut.  For at least seven years, Thomas Faria knowingly violated the law by directing his employees to discharge industrial wastewater into the public sewage system without a permit, and without monitoring the chemical levels of the discharge.  He pursued this illegal course over the objection of a manager who urged him in writing to bring the company into compliance with the law.  This Office will vigorously prosecute corporate officers whose decisions and actions, in the name of corporate profits, threaten Connecticut’s natural resources and harm the public’s right to a clean environment.  We recognize and thank the EPA for their invaluable work in protecting the environmental integrity of Connecticut’s rivers and the Long Island Sound.”

“Blatant disregard for our environmental laws occurs whenever greed and poor judgment intersect,” said Acting Special in Charge Gauthier.  “EPA, along with the Department of Justice and our federal and state partners, work tirelessly to protect New England’s natural resources and to ensure that there are serious repercussions for decisions like those of Thomas Faria.”

“Connecticut’s laws and regulations concerning the handling of industrial discharges are designed to protect public health and natural resources,” said Commissioner Klee.  “Mr. Faria’s blatant disregard for those requirements stands in sharp contrast to the majority of business leaders in our state who understand that respect for and compliance with environmental rules is consistent with growth and a strong bottom line.  The no nonsense handling of this case by the U.S. Attorney’s office sends a strong signal to all businesses that it clearly pays to ‘do the right thing’ at all times when it comes to our environment.”

According to court documents and statements made in court, the Clean Water Act requires that every company obtain a permit from the Connecticut Department of Energy and Environmental Protection (“CT DEEP”) before it can discharge its industrial wastewater to the public sewage system, commonly known as the publicly owned treatment works (“POTW”).  Companies are also required, among other things, to test and monitor their industrial wastewater monthly to ensure that the chemical levels in the wastewater do not exceed federal and state limitations.

Sheffield Pharmaceuticals (“Sheffield”) has a factory at 170 Broad Street in New London that manufactures a wide range of over-the-counter pharmaceutical creams, ointments and toothpastes.  From approximately 1986 to July 2011, Sheffield discharged industrial wastewater from its New London manufacturing operations to the New London POTW without a permit and in violation of Connecticut’s approved pretreatment program.  The New London POTW discharges to the Thames River in southeastern Connecticut.  During this entire time period, Sheffield lacked a pretreatment system at its factory to treat its industrial wastewater prior to discharge to the New London POTW, performed no regular monitoring of its discharges of industrial wastewater, and submitted no monthly monitoring reports to the CT DEEP.

After becoming the company’s president and chief executive officer in April 2003, FARIA soon learned through his own employees that Sheffield was discharging pollutants, including the toxic metal zinc, in its industrial wastewater without the required permit.  FARIA also learned that in order to obtain a permit from CT DEEP, the company would have to install, at significant expense, a wastewater pretreatment system that would pretreat its industrial wastewater prior to discharging it to the New London POTW.  Although FARIA’s own employees urged him to make the financial investment to bring the company into compliance, FARIA chose not to do so.  FARIA continued this illegal course even when four environmental consulting firms, which the company had hired, advised him that the discharge of industrial wastewater to the public sewage treatment system, without a pretreatment system and CT DEEP permit, is illegal.

On April 20, 2011, the CT DEEP conducted an unannounced inspection of Sheffield.  After finding that the company had no wastewater discharge permits, the CT DEEP inspector issued a Notice of Violation and cited the company for discharging manufacturing and laboratory wastewater without a permit.  On or about May 27, 2011, Faria Limited, LLC submitted a permit application to CT DEEP so that the company could legally discharge industrial wastewater from its New London facility into the New London POTW. 

By July 2011, the company had installed a wastewater pretreatment system at its factory to pretreat the pollutants contained in its industrial wastewater prior to its discharge to the New London POTW.

FARIA pleaded guilty to one count of knowingly violating, or causing to be violated, the Clean Water Act, an offense that carries a maximum penalty of three years of imprisonment and a fine of not less than $5,000 but not more than $50,000 per day of the violation.  Judge Thompson scheduled sentencing for October 6, 2014.

This matter has been investigated by the U.S. Environmental Protection Agency and the Connecticut Department of Energy and Environmental Protection.  The case is being prosecuted by Assistant U.S. Attorney Hal Chen and Special Assistant U.S. Attorney Peter Kenyon.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MARCOS MARTINEZ-GUTIERREZ, 43, a citizen of Mexico last residing in Norwalk, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 30 months of imprisonment for illegally reentering the U.S. after he was deported.

According to court documents and statements made in court, MARTINEZ-GUTIERREZ has never held legal status in the U.S. and has been removed from the U.S. to his native Mexico on three separate occasions, most recently in June 2011.

While unlawfully in the U.S. since at least 1990, MARTINEZ-GUTIERREZ has amassed a criminal history that includes four convictions for driving while intoxicated, three convictions for possession of narcotics, two convictions for assault against his then-girlfriend, one conviction for patronizing a prostitute, one conviction for criminal impersonation and two convictions for illegal entry.

MARTINEZ-GUTIERREZ has been in custody since March 3, 2013.  In July 2013, he was sentenced in Connecticut state court to three years of incarceration for possession of narcotics and criminal impersonation.

On April 14, 2014, MARTINEZ-GUTIERREZ pleaded guilty in federal court to one count of illegal reentry of a removed alien.  Judge Thompson ordered MARTINEZ-GUTIERREZ to serve his 30-month federal sentence after he is released from state custody.

This matter was investigated by U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations.  The case was prosecuted by Assistant U.S. Attorneys Krishna R. Patel and Carolyn A. Ikari.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury sitting in New Haven returned a 10-count indictment yesterday charging three New Haven men with crack cocaine distribution offenses.  One defendant is also charged with illegally possessing a firearm.

The indictment alleges that between November 2013 and May 2014, PERRY FLOWERS, also known as “Mel,” 44, MILES PRICE, also known as “Molly Rock,” 25, and TONY BROWN, also known as “Boogie Down,” 35, possessed and distributed crack cocaine.

The indictment further alleges that on April 12, 2014, PRICE possessed a Smith and Wesson, model 29, .44 caliber revolver.  Prior to that date, PRICE had been convicted in Connecticut state court of sale of hallucinogen/narcotics (twice), possession of narcotics (twice) and criminal weapon possession.  It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.

FLOWERS, PRICE and BROWN are charged in multiple counts of the indictment with possession with intent to distribute, and distribution of, cocaine base (“crack”), an offense that carries a maximum term of imprisonment of 20 years.  PRICE is also charged with one count of possession of a firearm by a previously convicted felon, an offense that carries a maximum term of imprisonment of 10 years.

The three defendants were arrested on June 18, 2014, and are currently detained.

This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the New Haven Police Department.  The case is being prosecuted by Assistant U.S. Attorneys Peter D. Markle and Anthony E. Kaplan.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Michael J. Ferguson, Acting Special Agent in Charge of the Drug Enforcement Administration for New England, today announced that DR. JOHN KATSETOS, 52, of Fairfield, was arrested yesterday on a charge that he exceeded the scope of his medical license to dispense controlled substances.

KATSETOS appeared today before U.S. Magistrate Judge Holly B. Fitzsimmons in Bridgeport and was released on a $1 million bond.

As alleged in a criminal complaint, DR. KATSETOS has practiced medicine for more than 20 years, most recently out of offices located at 90 Morgan Street in Stamford and 353 Bridgeport Avenue in Milford.  KATSETOS operated as a general practitioner and was not a licensed as a pain specialist.  A long-term Drug Enforcement Administration investigation, which included the use of undercover law enforcement personnel, revealed that KATSETOS was writing prescriptions for large quantities of Schedules II, III, IV and V controlled substances outside the scope of legitimate medical practice.

The complaint further alleges that a vast majority of these prescriptions were for medications that contain oxycodone, and that KATSETOS prescribed oxycodone despite awareness that his patients were addicted, had been arrested for possessing and distributing controlled substances, or were not actually using oxycodone themselves.

The complaint charges KATSETOS with conspiracy to distribute and to possess with intent to distribute controlled substances, as offense that carries a maximum term of imprisonment of 20 years and a fine of up to $1 million.

U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt.  Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the DEA’s New Haven Tactical Diversion Squad and the Office of Inspector General of the U.S. Department of Health and Human Services, with the assistance of the State of Connecticut Department of Consumer Protection Drug Control Division, and several local police departments.  The case is being prosecuted by Assistant U.S. Attorneys Rahul Kale and Alina Reynolds.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that two chiropractors convicted of charges stemming from an investigation into health care and insurance fraud were sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport.  JENNIFER LYNNE, 41, of Milford, was sentenced to three years of probation, the first six months of which she must serve in home confinement with electronic monitoring.  GEORGE U. DeCARVALHO, 57, of Stamford, was sentenced to three years of probation, during which he must perform 90 hours of community service.

This matter stems from “Operation Running Man,” a 14-month undercover fraud investigation headed by the Federal Bureau of Investigation.  The investigation, which included the use of recordings by an undercover FBI special agent, revealed that Joseph P. Haddad, a Bridgeport-based personal injury attorney, conspired with chiropractors and others to defraud several insurance companies by exaggerating the auto accident injuries of Haddad’s clients, and the cost of their medical care, to justify larger monetary settlements with the insurance companies.  As part of the scheme, the co-conspirators fabricated medical records, prescribed unnecessary pain medication, performed unnecessary chiropractic treatment, ordered and billed for diagnostic tests of questionable medical value, and overstated injuries or permanent partial disabilities that were allegedly caused by the accidents.

Between December 2006 and February 2010, Haddad conspired in the scheme with Francisco R. Carbone, who had been licensed to practice medicine until his license was revoked by the State of Connecticut in March 2005, and with Dr. Marc Kirshner, who owned and operated two chiropractor offices in Bridgeport and one in Stamford.

As part of the scheme, Haddad paid “runners” to locate and deliver to him clients for his personal injury practice.  Haddad then regularly instructed clients to see Carbone for purported medical treatment, even though Haddad was aware that Carbone had lost his medical license.  Carbone provided Haddad’s clients with prescription pain medication, even if the medication was not needed and, in reports, fabricated the clients’ injuries, medical conditions and permanent partial disability ratings.  In multiple instances, Carbone did no medical examination at all.  Carbone billed the victim insurance carriers in his name or in the name of another physician for services he allegedly rendered, and provided prescriptions, bills, medical reports and final reports to Haddad, who submitted the documents to the victim carriers to support requests for settlement.

Haddad also referred clients to Dr. Kirshner’s Bridgeport chiropractor offices, which operated under the name Health First Medical, P.C.  Kirshner often permitted Haddad to influence the course of patients’ medical treatments by acquiescing to Haddad’s instructions that a patient receive more treatment and diagnostic tests despite the questionable need for both.

LYNNE and Jennifer Netter are licensed chiropractors who worked for Kirshner.  Between approximately December 2006 and February 2010, Health First chiropractors performed unnecessary chiropractic treatments on Haddad’s auto-accident clients.  As part of the scheme, the chiropractors established a protocol to treat patients in Haddad’s cases for six months, regardless of medical need, and would not resolve treatment of patients unless instructed to do so by Haddad.  The chiropractors often falsified medical records by indicating that they had examined the patients when they had not, and by misrepresenting that patients’ pain complaints and other symptoms continued.  After the six-month period, each patient would receive a permanent partial disability rating, regardless of the permanence of the medical condition.  If a patient had received a permanency rating for a prior accident, the protocol was to give a higher or different disability rating for the present accident.  The chiropractic practice prepared false reports, which were then provided to the victim insurance carriers.

More than 10 insurance carriers lost at least $1.7 million as a result of this fraud scheme.  The loss directly attributable to LYNNE’s dealing with Haddad clients is $117,251.  Judge Underhill today ordered LYNNE to pay restitution in that amount.

On March 15, 2012, LYNNE pleaded guilty to one count of conspiracy to make false statements relating to health care matters.

DeCARVALHO is a licensed chiropractor who owns and operates a chiropractic practice in Bridgeport.   DeCARVALHO and Carbone shared office space in Bridgeport from approximately January 2004 to November 2005.  Before Carbone’s medical license was revoked, DeCARVALHO and Carbone provided chiropractic and medical treatment on a number of common patients who were involved in auto-accident litigation.  After March 2005, DeCARVALHO continued to treat certain patients knowing that payments for his services were coming from insurance settlements based, in part, on the purported treatment provided by Carbone.

In addition, in May 2007, DeCARVALHO was involved in an auto accident in which the other driver was liable.  DeCARVALHO contacted Carbone to fabricate medical records to show that DeCARVALHO had suffered certain injuries and had received medical treatment for those injuries allegedly sustained from the accident.  DeCARVALHO indicated that Carbone could bill carriers for treatment under DeCARVALHO’s automobile MedPay insurance.  In October 2007, Carbone fabricated the medical records and submitted claims to MedPay for reimbursement totaling approximately $6,000.  Relying on the false medical bills, DeCARVALHO subsequently settled the accident claim for an additional $4,500.

On June 29, 2012, DeCARVALHO pleaded guilty to one count of conspiracy to commit health care fraud.

Haddad, Carbone, Kirshner, Netter, and Dr. James Marshall, Jr. have each pleaded guilty to charges stemming from this scheme.  They await sentencing.

This matter has been investigated by the Federal Bureau of Investigation, with the assistance of the National Insurance Crime Bureau, the Metropolitan Property and Casualty Insurance’s Special Investigation Unit and the Travelers Insurance Company.

The case is being prosecuted by Assistant U.S. Attorneys Christopher W. Schmeisser and David J. Sheldon.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that EDDIE HAMMETT, 50, of Stamford, was sentenced yesterday by U.S. District Judge Stefan R. Underhill in Bridgeport to 66 months of imprisonment, followed by five years of supervised release, for his role in a southwestern Connecticut narcotics trafficking ring. 

This matter stems from a six-month investigation spearheaded by the Drug Enforcement Administration and the Stamford Police Department’s Narcotics and Organized Crime Squad.  As a result of the investigation, 20 individuals were charged with various federal offenses related to the distribution of cocaine and crack cocaine in Bridgeport, Norwalk and Stamford.  In addition, law enforcement officers seized more than $100,000 in cash, 500 grams of cocaine, 350 grams of crack cocaine, several vehicles and jewelry.

According to court documents and statements made in court, the investigation revealed that Marvin Wooten, also known as “Smash,” of Norwalk, was operating a significant crack cocaine distribution ring in Fairfield County.  Between September 2012 and January 2013, Wooten regularly purchased multi-hundred gram quantities of cocaine from various sources of supply, including individuals who were selling cocaine out of a Bridgeport barbershop.  He then converted the cocaine to crack cocaine and distributed it to other dealers and customers.

HAMMETT, a trusted friend of Wooten’s, was intercepted over a court-authorized wiretap ordering large quantities of crack from Wooten.  He then distributed the crack to other dealers and to his own customers.

HAMMETT’s criminal history dates to 1987 and includes approximately 19 misdemeanor and felony convictions.  He was on special parole with the State of Connecticut at the time of this offense.

On September 4, 2013, HAMMETT pleaded guilty to one count of possession with the intent to distribute 28 grams or more of cocaine base (“crack cocaine”).

Wooten also pleaded guilty and, on May 22, 2013, was sentenced to 120 months of imprisonment.

This matter has been investigated by the Drug Enforcement Administration’s Bridgeport High Intensity Drug Trafficking Area (HIDTA) Task Force – including the Bridgeport, Stamford, Norwalk, Milford, Westport, and Stratford Police Departments, and the Connecticut State Police – and the Stamford Police Department’s Narcotics and Organized Crime Squad.  The U.S. Marshals Service also assisted in the arrests of several of the defendants.

This case is being prosecuted by Assistant U.S. Attorneys Sarah Karwan and Robert Spector.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that NANCY DILLON, 69, of Guilford, pleaded guilty today before U.S. District Judge Alvin W. Thompson in Hartford to a federal tax charge related to her participation in an illegal pyramid scheme known as “Gifting Tables.”

According to court documents and statements made in court, a Gifting Table is configured as a four-level pyramid, with eight participants assigned to the bottom row, four participants assigned to the third row, two participants assigned to the second row, and one participant assigned to the top row.  The top row participant is referred to as the “Dessert,” the two participants on the second row as “Entrees,” the four participants on the third row as “Soup and Salads,” and the eight participants on the bottom row as “Appetizers.”  To join a Gifting Table, new participants were required to pay $5,000, typically cash, to the Dessert, that is, the participant occupying the top position on the pyramid.  The $5,000 payment, which was fraudulently characterized as a gift, secured the new participant a position as an Appetizer on the bottom row.  Participants progressed from the bottom row of the pyramid by recruiting additional people to join the Gifting Table.  When eight new participants joined a Gifting Table, each having made a $5,000 “gift” to the person occupying the Dessert position at the top of the pyramid, the Dessert left the Gifting Table and kept the $40,000 paid by the eight new participants.  That particular Gifting Table was then split, with the two participants occupying the Entree position on the second row moving to the top position (Dessert) of two new pyramids.  The other incumbent members of the Gifting Table moved up a row on one of the two newly-formed pyramids, and the search for 16 new participants began.  The success of the Gifting Tables depended on new participants joining and making the $5,000 “gift.”

In 2009, DILLON received $40,000 while participating in the Gifting Tables scheme.  Even though she had been advised by an attorney that the money was taxable income and not a gift, she failed to pay federal income taxes on the money she received.

DILLON pleaded guilty to one count of willful failure to file a return, supply information or pay tax, a charge that carries a maximum term of imprisonment of one year and a fine of up to $25,000.  Judge Thompson scheduled sentencing for September 24, 2014.

This matter is being investigated by the Internal Revenue Service – Criminal Investigation Division and prosecuted by Assistant U.S. Attorneys Douglas P. Morabito and Peter S. Jongbloed.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a “Jury Duty Scam” has again been reported in Connecticut.

The Clerk’s Office for the U.S. District Court for the District of Connecticut recently learned that three people reported that they received a call from a man falsely identifying himself as “Lt. Steve Smith” with “badge number 8031” from the U.S. District Court in Bridgeport.  The man referred to a case number, that the person had failed to appear for jury selection, and there was a warrant for their arrest.  The caller told the people that a bond had been set and the matter would be resolved if they gave him four Green Dot pre-paid $500 VISA cards.  In one instance, a victim purchased a Green Dot card and, at the caller’s direction, provided the card’s number to the caller.

The public is advised that this is a scam, and if a person were to receive a jury service-related call they should not provide any personal identification information or money to the caller.  Federal and state courts in Connecticut do not call prospective jurors and ask for money or personal identifying information over the telephone.  Juror information for the U.S. District Court in Connecticut can be found at www.ctd.uscourts.gov.

Anyone receiving a “Jury Duty Scam” phone call should report it, with any available Caller ID information, to the Federal Bureau of Investigation in New Haven at 203-777-6311, or 1-800-CALL FBI (1-800-225-5324).

U.S. Attorney Daly urged individuals who receive phone calls from suspicious sources never to disclose personal identifying information, as it may be used to cause serious financial harm and jeopardize a person’s credit.

“Identity thieves and scammers defrauding the public will be vigorously prosecuted when identified,” U.S. Attorney Daly stated.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that CHARLES PRINCIPATO, 52, of Rye, N.Y., pleaded guilty on Monday in New Haven federal court to engaging in a scheme to defraud investors of more than $1.3 million. 

According to court documents and statements made in court, between approximately January 2011 and February 2014, PRINCIPATO acted as principal of Prince Direct, Inc., an entity that he represented to victim-investors as being in the business of marketing products through advertising such as “infomercials.”  PRINCIPATO solicited money from victims, including Connecticut residents, for the stated purpose of funding the business operations of Prince Direct.  However, instead of using victims’ money for the stated purposes, PRINCIPATO used it for his own personal expenses, including for vacations and home renovations, and for gambling.  Through this scheme, PRINCIPATO defrauded victim-investors of more than $1.3 million.

On June 23, 2014, PRINCIPATO waived his right to indictment and pleaded guilty before Chief U.S. District Judge Janet C. Hall in New Haven to one count of wire fraud.  Judge Hall scheduled sentencing for October 7, 2014, at which time PRINCIPATO faces a maximum term of imprisonment of 20 years.

PRINCIPATO is currently released on a $250,000 bond.

This matter has been investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Susan L. Wines.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that TYLON VAUGHN, also known as “Bucky B,” 36, of New Haven, was sentenced today by Senior U.S. District Judge Ellen Bree Burns in New Haven to 144 months of imprisonment, followed by five years of supervised release, for distributing crack cocaine and marijuana.

VAUGHN is one of more than 100 individuals charged as a result of “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven.  Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms.

On December 6, 2013, a jury found VAUGHN guilty of one count of conspiracy to possess with intent to distribute, and to distribute, 280 grams or more of cocaine base (“crack cocaine”) and a quantity of marijuana, and two counts of distributing cocaine base.  According to the evidence at trial, VAUGHN received distribution quantities of crack from co-defendant Britt Martin, also known as “Big Baby,” and distributed crack and marijuana, as well as other controlled substances, to customers in Fair Haven.  In May and June 2011, investigators made two controlled purchases of crack from VAUGHN.

VAUGHN’s criminal history includes 11 prior convictions, six of which were for drug offenses.

Martin pleaded guilty to his role in this conspiracy and is currently serving a 120-month prison term.

This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments.  The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments have provided valuable assistance to the investigation.

This case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Marc Silverman, with assistance from Special Assistant U.S. Attorney Charles Rombeau.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury sitting in New Haven has returned an indictment charging SALIH KAYA, 53, of West Hartford, with one count of food stamp fraud.  KAYA is the owner and operator of Green Apple Market, located at 264 Farmington Avenue in Hartford.

The indictment was returned on June 24, 2014, and KAYA was arrested yesterday.  Following his arrest, he appeared before U.S. Magistrate Judge Thomas P. Smith in Hartford and was released on a $25,000 bond.

The federal food stamp program, known as the Supplemental Nutrition and Assistance Program (“SNAP”), is administered by the USDA’s Food and Nutrition Service (“FNS”) and utilizes federal tax dollars to subsidize low-income households to provide them with the opportunity to achieve a more nutritious diet by increasing their food-purchasing power.  SNAP recipients purchase eligible food items at retail food stores through the use of an Electronic Benefit Transfer (“EBT”) card.  SNAP benefits may be accepted by authorized retailers only in exchange for eligible items.  Items such as alcoholic beverages, cigarettes, paper goods and soaps are not eligible for purchase with Food Stamp benefits, and it is a violation of the rules and regulations governing the food stamp program to allow benefits to be used to purchase ineligible items.  SNAP benefits may not lawfully be exchanged for cash under any circumstances.  The program is designed so that the total amount of each purchase is electronically transferred to the retailer’s designated bank account.

According to the indictment and statements made in court, KAYA has owned Green Apple Market since it opened on July 1, 2008.  Between July 2011 and May 2014, it is alleged that KAYA illegally exchanged food stamps for cash and other ineligible items with customers at the store.  The FNS estimates that a reasonable sales figure for the store, given the size, amenities and location of the store, should be no more than $60,000 per year.  During this approximately three-year period, sales for the store totaled approximately $2.8 million. 

If convicted of the charge, KAYA faces a maximum term of imprisonment of 20 years.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the U.S. Department of Agriculture, Office of Inspector General and the Office of the Chief State’s Attorney.  The case is being prosecuted by Assistant U.S. Attorney Deborah R. Slater.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that GARI-MARK THOMAS, 39, of Michigan, formerly of Norwalk, was sentenced yesterday by U.S. District Judge Vanessa L. Bryant in Hartford to 12 months and one day of imprisonment, followed by three years of supervised release, for conspiring to defraud the Federal Housing Authority through a mortgage fraud scheme.  THOMAS pleaded guilty to the charge on February 4, 2014.

According to court documents and statements made in court, in March 2008, THOMAS, while serving as a loan officer for Suntrust Mortgage, assisted his girlfriend in obtaining a residential real estate loan to purchase a property at 510 E. Main Street in Stratford by submitting fraudulent information to the lender and the Federal Housing Authority (FHA).  The fraudulent information included a false claim that his girlfriend was employed with a tax and accounting company, false paystubs, false IRS tax forms and phony bank statements to make it appear that she had a bank account with assets in it, when in fact she had no such assets.

Based on the fraudulent loan documentation, the loan was issued by the lender and insured by the FHA.  HOMAS’ girlfriend ultimately defaulted on the loan, causing a loss of $184,538.37 to the FHA.

Judge Bryant ordered THOMAS to pay full restitution.

This matter was investigated by the U.S. Department of Housing and Urban Development, Office of Inspector General, and the Federal Bureau of Investigation.  The case was prosecuted by the U.S. Attorney’s Office Financial Fraud and Public Corruption Unit.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ROBBIE ROSSI, 42, formerly of Massachusetts, pleaded guilty yesterday before U.S. Magistrate Judge Donna F. Martinez in Hartford to one count of mail fraud arising from a scheme to fraudulently obtain disaster relief funds from the Federal Emergency Management Agency (FEMA).

According to court documents and statements made in court, a severe storm and tornado outbreak struck central Massachusetts on June 1, 2011.  After a Presidential Declaration authorized FEMA to provide disaster relief funds to local residents, ROSSI obtained more than $12,000 in disaster relief benefits by falsely representing that he lived at a residence on New Bridge Street in West Springfield, Mass., that had been damaged by the storm.  As part of the scheme, ROSSI provided FEMA with false documentation of rent payments he claimed to have paid in the months following the storm.  Between August 2011 and April 2013, ROSSI received payments at various addresses that he supplied to FEMA, including a residence in Enfield, Conn.

ROSSI is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on September 18, 2014, at which time he faces a maximum term of imprisonment of 30 years.  ROSSI also has agreed to pay restitution in the amount of $12,718.60.

ROSSI has been detained since his arrest in Las Vegas on January 14, 2014.

This case was investigated by the Office of the Inspector General of the U.S. Department of Homeland Security with the assistance of the Las Vegas office of the U.S. Secret Service.  The case is being prosecuted by Assistant U.S. Attorney David J. Sheldon.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ERNIE NEGRONI, also known as “Omega” and “King Omega,” 33, a former resident of Mansfield, Ohio,  and Connecticut, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 72 months of imprisonment, followed by three years of supervised release, for trafficking firearms.

According to court documents and statements made in court, on June 13, 2013, NEGRONI sold two firearms for $900 to an individual working with law enforcement.  The sale occurred in an apartment on Franklin Avenue in Hartford.  During the sale, the individual who purchased the firearms observed a suitcase with numerous other firearms and a backpack containing ammunition. NEGRONI also told the individual that he would be returning to Ohio in the near future to obtain more guns.

In the early morning hours of June 14, 2013, law enforcement officers executed a state search warrant at the apartment and seized nine handguns, a sawed-off shotgun and several hundred rounds of ammunition.  NEGRONI was arrested on federal firearm charges at that time.

NEGRONI is believed to have acquired the firearms at gun shows operating in Ohio and surrounding states.

NEGRONI, an admitted member of the Almighty Latin King Nation, has a criminal history that includes multiple felony drug convictions.  It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.

NEGRONI has been detained since his arrest on June 14, 2013.  On February 3, 2014, he pleaded guilty to one count of possession of firearms and ammunition by a convicted felon.

This matter was investigated by the FBI’s Northern Connecticut Violent Crimes Task Force, the Connecticut State Police, the Hartford Police Department, and the Connecticut Department of Correction.  The case was prosecuted by Assistant U.S. Attorney Brian P. Leaming.

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New Haven – Law enforcement officials today announced the results of a four-month joint law enforcement initiative to stem violent crime in Bridgeport and New Haven.  The operation, headed by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), resulted in the seizure of more than 73 illegal firearms and is expected to result in the prosecution of 154 individuals on federal or state charges.  Today’s announcement was made by U.S. Attorney Deirdre M. Daly, ATF Special Agent in Charge Daniel J. Kumor, Bridgeport Police Chief Joseph L. Gaudett, Jr., New Haven Police Chief Dean Esserman, Commissioner Dora B. Schriro of the Connecticut Department of Emergency Services and Public Protection, Fairfield State’s Attorney John Smriga and New Haven State’s Attorney Michael Dearington.

“There is no higher calling in law enforcement than preventing violent crime,” stated U.S. Attorney Deirdre M. Daly.  “Under the powerful leadership of the ATF and with the invaluable collaboration of the Bridgeport and New Haven Police Departments, the Connecticut Department of Emergency Services and Public Protection and other local and federal law enforcement agencies, Operation Samson has successfully stemmed the violence in two of Connecticut’s largest cities.  Samson included dangerous undercover operations.  We commend the agents and officers who repeatedly risked their lives to remove over 70 illegal guns and a large number of violent offenders from our communities.”

“ATF is always focused on violent crime, as this four-month enhanced enforcement initiative has shown,” stated Daniel J. Kumor, Special Agent in Charge of the ATF Boston Field Division.  “The citizens of New Haven and Bridgeport have been victimized by violent criminals who act with total disregard for public safety and our goal is to take these offenders off the streets, period.  The partnership of law enforcement and prosecutors in Connecticut taking a united stand contributed to the operation’s overall success.  To this end, we are committed to utilize every resource to keep citizens safe.  To those who choose to disregard the rules of our communities by committing violence, be warned, we will not rest until you are off the streets.”

In March 2014, the ATF and the Bridgeport and New Haven Police Departments launched “Operation Samson” a multi-layered initiative targeting violent criminals and illegal firearm possession and firearm trafficking in New Haven and Bridgeport.  As part of the initiative, approximately 40 ATF special agents and personnel from Connecticut and across the country were deployed with New Haven and Bridgeport Police to conduct numerous covert operations.  The combined law enforcement team brought a range of expertise to the operation, including tactical, technical, analytical, undercover skills and supervisory experience.

Several other federal, state and local law enforcement agencies supported the initiative as investigations expanded into other cities and towns in Connecticut and across state lines.

The initiative employed intelligence-led policing to determine where to place resources in order to have the greatest impact.  During Operation Samson, law enforcement personnel conducted approximately 425 operations, which included undercover meetings, controlled purchases of firearms and narcotics, and the execution of search and arrest warrants.  As a result, a total of 80 individuals have been charged, or are expected to be charged, with a variety of federal firearms, narcotics and robbery violations.  In addition, 74 defendants have been charged, or expected to be charge, with various state offenses. 

The operation resulted in the confiscation of 73 firearms, including sawed-off shotguns, sawed-off rifles and a silencer. Law enforcement also recovered more than one kilogram of crack cocaine, approximately 750 grams of powder cocaine, more than 200 grams of heroin, more than seven kilograms of marijuana, and approximately 400 prescription narcotic pills.

During Operation Samson, investigators uncovered an alleged firearms trafficking ring that used out-of-state straw purchasers who accepted narcotics in exchange for firearms.  This ring was identified as having trafficked approximately 100 firearms into Connecticut.  A second alleged firearms trafficking ring that used straw-purchasers within Connecticut is estimated to be responsible for delivering 30 illegal firearms into New Haven and Bridgeport.  Both of these cases are still being actively investigated.

Investigators also identified and arrested alleged members of robbery crews, some of whom also trafficked in firearms and narcotics.

“I am deeply grateful to the ATF and also the state crime lab,” stated Bridgeport Police Chief Joseph L. Gaudett, Jr.  “For the last few months, ATF agents and our officers have worked together seamlessly every day and night.  There was a common goal to take guns and dangerous criminals off the street.  The technicians at the crime lab worked behind the scenes but they were equal partners in helping us build these cases.  Any time law enforcement sent evidence for analysis, the response unfailingly was ‘We’ll get right on it. When do you need the results?’ Because of those efforts, the streets of Bridgeport are safer today.”

“Cooperation between police departments, law enforcement agencies and the community are what’s required to achieve progress,” stated New Haven Police Chief Dean Esserman.  “This collaboration, led by the ATF, is an impressive example of cooperation.  We are particularly grateful to them, the U.S. Attorney’s Office and the Connecticut State Crime Laboratory.  This precedent-setting mission has targeted local gun violence and shown great results.  We’re proud of those who’ve put in the long hours to see this operation through.  New Haven and the State of Connecticut are safer for it.”

“The results of this initiative clearly demonstrate the effectiveness of cooperation between federal and state law enforcement,” stated Fairfield State’s Attorney John Smriga.

“This initiative has brought together all branches of law enforcement to strengthen partnerships, provide a sense of security and make our greater New Haven communities safer,” stated New Haven State’s Attorney Michael Dearington.

An instrumental component of Operation Samson has been the work of the Connecticut State Crime Laboratory in utilizing the National Integrated Ballistic Information Network (NIBIN) to analyze ballistics evidence.  NIBIN is an ATF-administered digital ballistics imaging system that aids law enforcement agencies in their investigations by capturing images of shell casings to link violent crimes involving firearms, and subsequently identify firearms users or “trigger pullers.”  NIBIN-users are able to acquire digital images of the unique markings made on fired ammunition recovered from a crime scene or test-fired from a crime gun recovered by law enforcement, and then quickly compare those images against earlier NIBIN entries.  If a potential match emerges, firearm examiners compare the original evidence with a microscope to confirm the match, or a “hit.”

Within recent months, the Connecticut State Crime Laboratory has entered ballistics evidence recovered from crimes committed within the state into NIBIN and identified a substantial number of NIBIN “hits.”  To date, 42 such hits have linked 104 crimes involving the unlawful discharge of firearms that have occurred in Bridgeport, New Haven and surrounding areas.  NIBIN has linked these unlawful discharges to robberies, aggravated assaults, and homicides.  Importantly, these links have provided law enforcement with timely, actionable leads to assist in identifying serial shooters and violent criminal organizations.  NIBIN has also been instrumental in the investigation of four separate homicides.  One firearm recovered during Operation Samson has been linked to a previously unsolved homicide and five additional shooting investigations.

“I would like to thank the Bureau of Alcohol, Tobacco and Firearms and Explosives for its commitment of resources to the state of Connecticut and to Operation Samson,” stated Dr. Dora B. Schriro, Commissioner of the Department of Emergency Services and Public Protection.  “Bridgeport and New Haven are to be commended as well for their leadership in making their communities safer places to live and work.  The additional financial support provided by the Statewide Firearms Trafficking Task Force and the participation by the Connecticut State Police and the State Crime Laboratory were also critical to the success of the Operation.  In just a matter of months, this partnership has helped to reduce gun violence and strengthen our communities.”

Operation Samson is the ninth Enhanced Enforcement Initiative (EEI) conducted by ATF since 2012.  The cities of New Haven and Bridgeport were chosen for this EEI based on Uniform Crime Reports that ranked both cities as having high amounts of violent crime, and due to existing partnerships between ATF and the New Haven and Bridgeport Police Departments.  Previous ATF EEI’s were deployed in New Orleans; Philadelphia; Oakland, Calif.; Flint, Mich.; Chicago; Stockton, Calif.; St. Louis, and Camden, N.J.
U.S. Attorney Daly and ATF Special Agent in Charge Kumor acknowledged and commended the investigative support and assistance of several additional law enforcement agencies including the U.S. Marshals Service, Homeland Security Investigations, the Statewide Firearms Trafficking Task Force, the Connecticut State Police, the Connecticut Department of Correction and the Milford, Norwalk, Stamford, Waterbury and West Haven Police Departments.

The federal cases are being prosecuted by the U.S. Attorney’s Office’s Violent Crime and Narcotics Unit under the leadership of Assistant U.S. Attorneys Dave Vatti, Robert Spector and Tracy Dayton.

U.S. Attorney Daly stressed that charges contained in indictments and complaints are not evidence of guilt.  Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, and Patricia M. Ferrick, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, today announced that WILFRIDO A. CARDENAS HOFFMAN, 30, of El Hatillo, Venezuela, was arrested on June 21 in Miami on a federal criminal complaint charging him with making numerous threatening phone calls to residents of Newtown, Connecticut, shortly after the Sandy Hook Elementary School shooting tragedy in December 2012.

On May 20, 2013, CARDENAS HOFFMAN was charged in a criminal complaint with transmitting threats in interstate or foreign commerce to injure the person of another.  According to the complaint, a redacted copy of which was unsealed today, CARDENAS HOFFMAN made numerous phone calls to residents of Newtown on December 16, 2012, two days after the shooting that claimed 26 lives at Sandy Hook Elementary School in Newtown.  In one of the telephone calls, HOFFMAN allegedly stated: “This is Adam Lanza. I’m gonna [expletive] kill you.  You’re dead.  You’re dead.  You hear me?  You’re dead.”  In another phone call, HOFFMAN allegedly stated: “This is Adam Lanza.  I’m gonna kill you.  You’re dead.  With my machine gun.  You’re dead [expletive].”

CARDENAS HOFFMAN was arrested on Saturday as he transitioned through Miami International Airport en route to Mexico from Venezuela.  He made his initial appearance today before U.S. Magistrate Judge William C. Turnoff in the Southern District of Florida and is scheduled to return to court on Thursday at 10 a.m. for a detention hearing.

UPDATE: On July 16, 2014, CARDENAS HOFFMAN appeared before U.S. Magistrate Judge Joan G. Margolis in New Haven.  He waived his right to a probable cause hearing for 60 days and was ordered to undergo a psychiatric evaluation. He has been detained since his arrest on June 21. 

Newtown residents who believe that they received a threatening call are encouraged to call Lori Vernali, the Victim/Witness Coordinator for the U.S. Attorney’s Office, at 203-821-3818.

“This complaint charges that Cardenas Hoffman made dozens of threatening telephone calls to residents of Newtown when they were suffering from one of the worst tragedies in our nation’s history,” stated U.S. Attorney Daly.  “Threatening such vulnerable people is reprehensible and inhuman criminal conduct.  Further, it inappropriately stressed law enforcement resources at a critically demanding time.  This case demonstrates the resolve of our office and the FBI to arrest individuals who believe that international boundaries will protect them from prosecution in the United States.”

“The motivation to catch criminals runs deep within the FBI, but the pursuit of criminals who prey on innocent victims motivates agents like nothing else,” stated FBI Special Agent in Charge Ferrick.  “That someone can so callously prey on a community with such hate and vitriol is beyond comprehension.  This arrest, a year and a half after the Newtown tragedy, speaks to the unrelenting commitment and compassion for victims and their families and sends an important warning to those inclined to commit similar crimes.  The FBI’s reach is exceptionally far and wide and equally enduring.”

The charge of transmitting threats in interstate or foreign commerce carries a maximum term of imprisonment of five years and a fine of up to $250,000.

U.S. Attorney Daly stressed that the filing of a criminal complaint is not evidence of guilt.  The charges in a criminal complaint are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorneys Edward Chang and Krishna Patel, with the assistance of the U.S. Attorney’s Office for the Southern District of Florida and Assistant U.S. Attorney Sarah Schall.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that MAURICE L. MILLIGAN, 35, of New London, pleaded guilty today before U.S. Magistrate Judge Thomas P. Smith in Hartford to one count of possession of a firearm by a previously convicted felon.

According to court documents and statements made in court, at approximately 11:30 p.m. on April 22, 2013, New London Police received reports of shots fired in the vicinity of a convenience store located on Ocean Avenue near the intersection of Evergreen and Sherman Streets.  Responding officers did not find any victim of the shooting, but did locate and seize four spent 9mm Winchester shell casings in the immediate area.  The investigation determined that two males had had a verbal altercation inside the convenience store and, shortly thereafter, a number of shots had been fired outside the business.  Review of video from inside and outside the store led to the identification of MILLIGAN as the probable shooter. 

On April 25, 2013, New London Police observed MILLIGAN sitting in the driver’s seat of a parked vehicle.  Officers ordered MILLIGAN to exit the car and saw that he was wearing a bullet-proof vest.  Officers then searched the vehicle and recovered from under the driver’s seat a Glock, Model 17, 9mm semi-automatic pistol with an obliterated serial number.  The handgun was loaded with 19 rounds of Winchester 9mm ammunition.  Further examination of the gun revealed that the serial number on the frame of the weapon had been removed.

A ballistics comparison made of the shell casings recovered on the night of April 22 with the Glock seized from under the driver’s seat of the car MILLIGAN was driving on April 25 established that the Glock was the weapon that fired the shots.

Prior to April 2013, MILLIGAN had been convicted in the Queens County (N.Y.) Supreme Court of third degree criminal possession of a loaded firearm and second degree robbery.

It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.  It is also a violation of federal law for a convicted felon to wear protective body armor, and for an individual who has been convicted of a violent felony offense to possess body armor.

MILLIGAN is scheduled to be sentenced by U.S. District Judge Vanessa L. Bryant on September 10, 2014, at which time he faces a maximum term of imprisonment of 10 years.  He has been detained since his arrest on April 25, 2013.

This matter has been investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the New London Police Department and the Office of the State’s Attorney for the Judicial District of New London.  The case is being prosecuted by Assistant U.S. Attorney John H. Durham.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ANTHONY STERLIN CANTAVE, 34, and VENUS VERGES, 33, both of Danbury, were arrested today on an indictment charging them with participating in a conspiracy involving the theft of monies from the U.S. Postal Service.  The indictment was returned by a federal grand jury in New Haven on June 18 and the defendants were arrested today.

According to the indictment, between August and October 2013, CANTAVE and VERGES purchased U.S. Postal Service money orders in amounts ranging from $400 to $1000 at post offices in Fairfield County.  After the money orders were purchased, the defendants used a mobile banking application to deposit the funds into bank accounts they controlled.  Shortly after depositing the funds, the defendants returned to the post offices from which the respective money orders had been purchased, failed to disclose that they had deposited the funds, returned the money orders and were refunded their money.

CANTAVE and VERGES are charged with one count of conspiracy to convert public money, and offense that carries a maximum term of imprisonment of five years.  In addition, CANTAVE is charged with 11 counts and VERGES is charged with five counts of conversion of public money, an offense that carries a maximum term of imprisonment of 10 years.

CANTAVE and VERGES appeared today before U.S. Magistrate Judge Donna F. Martinez in Hartford and entered pleas of not guilty.  They are currently detained.

The case has been assigned to U.S. District Judge Michael P. Shea in Hartford.

This matter is being investigated by the U.S. Postal Inspection Service and is being prosecuted by Assistant U.S. Attorney John H. Durham.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt.  Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that MICHAEL THOMPSON, 35, of New Haven, was sentenced yesterday by Senior U.S. District Judge Ellen Bree Burns in New Haven to 168 months of imprisonment, followed by five years of supervised release, for distributing cocaine, crack cocaine and oxycodone.

THOMPSON is one of more than 100 individuals charged as a result of “Operation Bloodline,” a joint law enforcement investigation targeting narcotics trafficking and gang violence in the Dwight-Kensington and Fair Haven sections of New Haven.  Led by the DEA New Haven Task Force and the New Haven and Hamden Police Departments, the year-long investigation included the use of court-authorized wiretaps on numerous telephones, extensive physical surveillance, controlled purchases of narcotics, execution of search warrants, and seizures of narcotics and firearms.

On December 6, 2013, a jury found THOMPSON guilty of one count of conspiracy to possess with intent to distribute, and to distribute, five kilograms or more of cocaine, 280 grams or more of cocaine base (“crack cocaine”), and a quantity of oxycodone.

According to the evidence at trial, THOMPSON received kilogram quantities of cocaine from suppliers, including co-defendant Christopher “White Boy Chris” Morley, which THOMPSON converted into crack cocaine and then sold to other narcotics distributors and customers.  Morley also provided THOMPSON with quantities of oxycodone, which THOMPSON redistributed to others.  At times, THOMPSON supplied powder cocaine to Morley.

THOMPSON’s criminal history includes at least nine prior felony convictions.

Morley pleaded guilty and awaits sentencing.

This matter has been investigated by the Drug Enforcement Administration’s New Haven Task Force, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia and Meriden Police Departments.  The United States Marshals Service, the Connecticut State Police, the Connecticut Department of Correction, Parole and Community Services and the Milford, Hartford, New Britain, North Branford and Stratford Police Departments have provided valuable assistance to the investigation.

This case is being prosecuted by Assistant United States Attorneys S. Dave Vatti and Marc Silverman.

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The United States Attorney for the District of Connecticut announced that ANTHONY TESTO, 66, of Monroe, pleaded guilty today before U.S. Magistrate Judge Donna F. Martinez in Hartford to fraud and tax charges stemming from a scheme to defraud a Bridgeport-based residential property owner.  TESTO, the owner and president of ACT Builders, Inc., also entered a plea of guilty on behalf of his company.

According to court documents and statements made in court, ACT Builders, Inc. was contracted to serve as a property manager for an entity in Bridgeport that owned an apartment complex and several single and multi-family residences.  TESTO’s role as property manager included filling vacant rental units, setting rental amounts, collecting security deposits, collecting rent from tenants and depositing rental payments in the property owner’s bank account.  TESTO also was required to submit to the property owner a monthly “rent roll,” which was a spreadsheet showing the occupancy of the rental units, the rental amounts due and the rental payments collected from tenants.

From approximately January 2007 to August 2010, TESTO, ACT Builders and others schemed to defraud the property owner by submitting fraudulent rent rolls that misrepresented that certain rental units were vacant with no rent due when, in fact, the apartments were occupied and rent had been collected.  The rent rolls also misrepresented that the rent due and collected for certain rental units was lower than the amount that was actually collected.  TESTO deposited rental income that was due to the property owner into both his personal bank account and the ACT Builders bank account.

TESTO, who hired subcontractors to provide maintenance services for the property, also submitted fraudulent subcontractor invoices to the property owner.

TESTO defrauded the property owner of at least $275,000 through this scheme.  He also failed to report this fraudulent income on his 2007 through 2010 personal federal income tax returns, resulting in a tax loss to the Internal Revenue Service of $71,795.

TESTO pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum term of imprisonment of 20 years, and one count of assisting in the preparation and filing of a false tax return, which carries a maximum term of imprisonment of three years.  Act Builders pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum term of probation of five years.

TESTO has agreed to pay full restitution to the victim property owner, as well as back taxes, plus penalties and interest.

TESTO and Act Builders are scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on September 2, 2014.    

TESTO was arrested on March 13, 2014 and is currently released on a $500,000 bond.

This matter is being investigated by the Federal Bureau of Investigation, and the Internal Revenue Service – Criminal Investigation Division.  The case is being prosecuted by Assistant U.S. Attorney Felice Duffy.

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The United States Attorney’s Office for the District of Connecticut hosted its annual United States Attorney’s Office Law Enforcement Awards Ceremony this afternoon in New Haven.  The ceremony at the City of New Haven’s aldermanic chambers recognized more than 160 individuals for their investigative efforts in 30 significant federal criminal prosecutions and civil cases in Connecticut.

The highlighted cases demonstrate the broad variety of work performed by local, state and federal law enforcement agencies in Connecticut, including the FBI, DEA, ATF, U.S. Marshals Service, U.S. Postal Inspection Service, U.S. Coast Guard, U.S. Department of Health and Human Services, U.S. Department of Housing and Urban Development, U.S. Department of Labor, U.S. Department of Transportation, U.S. Department of Homeland Security, U.S. Department of Defense, SIGTARP, the Connecticut State Police, Connecticut Department of Correction, and Connecticut Department of Banking.  More than 30 of the award recipients are members of local police departments from across Connecticut.

“Today, we proudly recognize our law enforcement partners for their exceptional work,” stated U.S. Attorney Daly.  “We are grateful for the courage and dedication they bring to the job.  It is our great honor to work with them and to celebrate their accomplishments as they devote their lives to ensuring the safety and security of our communities and all those who live in our state.”

Several unit awards and special awards were also presented during the ceremony.

The U.S. Attorney’s Award for Outstanding Investigator was presented to FBI Financial Analyst Elizabeth McCartney for her exceptional work on many significant financial fraud investigations.

The U.S. Attorney’s Award for Outstanding Partnership was presented to a group of local and state law enforcement officers who are assigned to various federal task forces.  Award recipients include Captain Luis Sosa of the Connecticut Department of Correction, Detective Stanford Dowling of the Bridgeport Police Department, Detective Mark Solomon of the Greenwich Police Department, Detective Francis Bellizzi of the New Britain Police Department, Officers Michael Mastropetre and Jonathan Young of the New Haven Police Department, Officer Brian Laurie of the New London Police Department, and Officer Heather Bozentko, Detective William Brevard, Sergeant Christopher Broems and Sergeant Kevin Keenan of the Stamford Police Department.

The Civil Division Unit Award was presented to Debra Reale, who has been the Associate Area Counsel, Small Business, Self Employed Division for the Internal Revenue Service’s Office of Chief Counsel for 26 years.

The National Security and Major Crimes Unit Award was presented to Peter Kenyon, Regional Criminal Enforcement Counsel for the Environmental Protection Agency, for his investigation and prosecution of numerous major environmental cases in Connecticut during the past 23 years.

The Financial Fraud and Public Corruption Unit Award was presented to FBI Special Agents William Aldenberg, Stacy Bowery, Matthew McPhillips and Jeffrey Waterman, whose investigative efforts led to the successful prosecution of eight individuals who engaged in a scheme to direct illegal contributions into the campaign of a candidate for the U.S. House of Representatives.

The Violent Crimes and Narcotics Unit Award was presented to the lead investigators in Operation Bloodline, which targeted narcotics trafficking and gang violence in New Haven, and resulted in more than 90 federal convictions.  The award recipients were DEA Special Agents Michael Cogan and Anastas Ndrenika, DEA Task Force Officers Tony Miranda and David Rivera of the New Haven Police Department, and DEA Task Force Officers Joshua Cameron and Dedric Jones, and Investigator Lance Helms, of the Hamden Police Department.

The United States Attorney’s Office is charged with enforcing federal criminal laws in Connecticut, and with representing the federal government in civil litigation in the District.  The District is composed of approximately 64 Assistant U.S. Attorneys and approximately 60 staff members at offices in New Haven, Hartford and Bridgeport.

PUBLIC AFFAIRS CONTACT:

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Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that a federal grand jury sitting in Hartford has returned an indictment charging KIEJUAN HAUGABOOK, 35, of Hartford, with one count of possession of a firearm by a convicted felon, one count of possession of a sawed-off firearm by a convicted felon, and one count of possession of body armor by a violent felon.  The indictment was returned on June 11 and was unsealed today during HAUGABOOK’s arraignment before U.S. Magistrate Judge Joan G. Margolis in New Haven.

As alleged in court documents and statements made in court, HAUGABOOK escaped from a halfway house in Hartford.  On February 3, 2014, a parole officer found him in an apartment in Hartford.  Upon entering the apartment, the parole officer noticed a firearm in plain view and contacted the Hartford Police Department.  Hartford Police arrived on the scene and seized a Harrington & Richardson, Model Topper 158, firearm with a sawed-off barrel, as well as ammunition, a Point Blank ballistic vest and a stun gun.

The indictment alleges that HAUGABOOK has previous state convictions for first and third degree robbery, possession of narcotics and carrying a pistol without permit.  It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce. It is also a violation of federal law for a person previously convicted of a violent felony offense to possess body armor that has moved in interstate commerce.

This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Hartford Police Department.  The case is being prosecuted by Assistant U.S. Attorneys Ndidi Moses and Brian Leaming.

U.S. Attorney Daly stressed that an indictment is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

PUBLIC AFFAIRS CONTACT:

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that JANIECE MICHELLE HOUGH, 41, of Kempner, Texas, pleaded guilty today before U.S. District Judge Stefan R. Underhill in Bridgeport to one count of smuggling goods from the United States.  The charge stems from HOUGH’s sale of two Advanced Combat Optical Gunsights (ACOGs) destined for Germany in violation of the International Trafficking in Arms Regulations.

Following her plea of guilty, Judge Underhill sentenced HOUGH to six months of imprisonment, followed by three years of supervised release, the first eight months of which she must serve in home confinement.  HOUGH was also ordered to perform 100 hours of community service and to forfeit $198,054.

According to court documents and statements made in court, HOUGH worked for a government contractor and was based at Fort Hood in Texas.  On the side, she operated an online business selling surplus military clothing and equipment on eBay.  While working at Fort Hood, HOUGH purchased military equipment from U.S. Army personnel, including Michael Bartch, for re-sale online.  In June 2010, HOUGH sold and shipped two ACOGs to an individual in Connecticut with the understanding that the AGOGs were destined for Germany.

HOUGH did not have a license from the U.S. State Department, which is required to export ACOGs and other items on the U.S. Munitions List.

Bartch, of Copperas Cove, Texas, was prosecuted by the U.S. Attorney’s Office for the Western District of Texas.  On April 17, 2013, he was sentenced to 24 months of imprisonment.

In the District of Connecticut, this case was investigated by the Defense Criminal Investigative Service, Homeland Security Investigations, and the U.S. Department of Commerce, Bureau of Industry and Security, Boston Field Office.  The case was prosecuted by Assistant U.S. Attorneys Edward Chang and Hal Chen.

PUBLIC AFFAIRS CONTACT:

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Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that LOUIS VUCCI, JR., 45, of Ridgefield, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 12 months of imprisonment, followed by three years of supervised release, for evading the payment of nearly $200,000 in federal taxes over a five-year period.

According to court documents and statements made in court, from 2005 through 2009, VUCCI failed to report more than $678,000 in income he received while serving as president and CEO of Diamond Ranch Foods (“DRF”), a publicly-traded company in the business of selling and distributing meat products in the New York area.  VUCCI underreported his income by $112,310 in 2005, $109,473 in 2006, $174,300 in 2007, $187,704 in 2008, and $95,126 in 2009.  The unreported income consisted of weekly pay checks from DRF in the amount of $2,500 that were made payable to VUCCI’s spouse, who did not work for DRF, and deposited into a bank account in his spouse’s name.  Also, in 2008 and 2009, VUCCI had one of DRF’s customers pay him for purchases with blank checks, which checks he then completed and deposited into his personal bank account.  The checks totaled $26,236 in 2008 and $65,387 in 2009.

In addition, large cash deposits totaling $16,100 in 2008 and $25,020 in 2009 were made into VUCCI’s personal bank accounts. These deposits were cash payments from another DRF customer for DRF sales to the customer.

VUCCI’s federal individual income tax returns reported income of $19,590 in 2005, $12,500 in 2006, $12,000 in 2007, $30,000 in 2008, $125,202 in 2009.  The reported low income from 2005 to 2008 automatically qualified VUCCI for the Earned Income Credit yielding refunds rather than taxes owed.

From mid-2005 to mid-2007, VUCCI and his spouse rented a home in Greenwich for $8,500 per month, had car expenses in excess of $1,000 per month, and paid a housekeeper for approximately 20 hours per week.  In 2007, VUCCI purchased a house in Ridgefield for $975,000 and continued to make the car payments.

Judge Bryant ordered VUCCI to pay back taxes in the amount of $196,425, as well as substantial interest and penalties.

On October 3, 2013, VUCCI pleaded guilty to one count of tax evasion.

VUCCI was ordered to report to prison on September 9, 2014.

This matter was investigated by the Internal Revenue Service – Criminal Investigation Division.  The case was prosecuted by Assistant U.S. Attorney Peter S. Jongbloed.

PUBLIC AFFAIRS CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
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