District of Delaware

WILMINGTON, Del. – A criminal information was filed today in the U.S. District Court for the District of Delaware against Roos Foods Inc., charging the company with the distribution of adulterated cheese in interstate commerce, U.S. Attorney Charles M. Oberly, III announced today.   The company has signed a plea agreement in which it has agreed to plead guilty to a misdemeanor violation of the federal Food, Drug and Cosmetic Act (FDCA).  In addition to the company’s agreement to plead guilty, Roos, and its principals, Ana A. Roos and Virginia Mejia, have agreed to a proposed consent decree of permanent injunction. 

Roos Foods distributed several varieties of ready-to-eat cheese, including ricotta, queso fresco and fresh cheese curd and sold and distributed its products to wholesale customers in Maryland, New Jersey, Virginia and Washington D.C., according to the information.  A civil complaint along with the proposed consent decree was also filed in the U.S. District Court for the District of Delaware.  The criminal charge and civil complaint allege that Roos distributed cheese in interstate commerce connected to an outbreak of Listeria monocytogenes (L. mono) in early 2014. 

“We must work to ensure that the food we buy is free from dangerous bacteria and is safe to eat,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “The Department of Justice will continue to work aggressively to combat and deter conduct leading to the distribution of adulterated food to consumers.”

“It is cases like this that demonstrate the need for government regulations concerning food safety, ” said U.S. Attorney Charles M. Oberly III for the District of Delaware. “Fortunately, there were no serious or permanent injuries as a result of the marketing of contaminated cheese. Manufacturers of our nation’s food supplies must comply with the law and when violators are found they should expect to be prosecuted and, if necessary, put out of business.”

The criminal information alleges that on Feb. 21, 2014, the Centers for Disease Control and Prevention (CDC) reported that a total of eight people (five adults and three newborns) in Maryland and California were infected with L. mono and according to the CDC, several of the Maryland patients reported having eaten soft or semi-soft cheeses in the month before becoming ill. 

L. mono is the bacterium that causes the disease listeriosis.  Listeriosis is most commonly contracted by eating food contaminated with L. mono.   Listeriosis can be serious, even fatal, for high-risk groups such as unborn babies, newborns and those with impaired immune systems. 

Unlike many other foodborne microbes, L. mono bacteria are capable of adapting and growing even at refrigerator temperatures.  Thus, the presence of L. mono in ready-to-eat foods is a particularly significant public health risk.

As alleged in the information, following a report that L. mono had been isolated from cheese manufactured by Roos Foods, the U.S. Food and Drug Administration (FDA) inspected the firm’s Kenton, Delaware, facility and established that ready-to-eat cheese products were adulterated in that they had been prepared, packed or held under insanitary conditions whereby they may have become contaminated with filth or rendered injurious to health.  As alleged, FDA found numerous failures to implement effective monitoring and sanitation controls in accordance with current Good Manufacturing Practices.

The information alleges that the FDA inspection revealed significant sanitation deficiencies, such as widespread roof leaks in the manufacturing area, including over open manufacturing equipment; rust flakes on the manufacturing equipment from corroded roof trusses and metal roofing; un-cleanable surfaces on walls, floors and ceilings and product residue on equipment that had purportedly been cleaned.  In addition, as alleged in the information, FDA collected environmental samples and found L. mono on 12 surfaces in the facility.

On March 11, 2014, FDA suspended the food facility registration of Roos Foods after determining there was a reasonable probability that food manufactured, processed, packed, or held by Roos Foods would cause serious adverse health consequences or death to humans.  A company without a food facility registration cannot distribute any food products.  Roos Foods has not reopened.

“The FDA will not tolerate food companies that fail to provide adequate safeguards and place the public health at risk by producing and shipping contaminated products,” said FDA’s Deputy Commissioner for Global Regulatory Operations and Policy Howard Sklamberg, J.D.  “We will continue to work with the Department of Justice to use the full force of our justice system against those that place profits over the health and safety of American consumers.”

The civil complaint alleges that Roos Foods and two individual defendants violated the FDCA by, among other things, introducing or delivering for introduction into interstate commerce articles of food that were adulterated in that the food was prepared, packed or held under insanitary conditions whereby it may have become contaminated with filth or rendered injurious to health.  The proposed consent decree of permanent injunction requires the defendants to cease receiving, preparing, processing, packing, holding and distributing all food products unless and until the defendants bring their operations into compliance with the FDCA and its implementing regulations.

The criminal case is being prosecuted by Trial Attorney Heide L. Herrmann of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorneys Jennifer Welsh and Edmond Falgowski of the District of Delaware.  They were assisted by Associate Chief Counsel Laura Pawloski of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services.  The case was investigated by the FDA’s Office of Criminal Investigations.

The government is represented in the civil case by Trial Attorney Megan Englehart of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorney Patricia Hannigan of the District of Delaware, with the assistance of Associate Chief Counsel Shannon M. Singleton of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services.

A criminal information is merely an allegation and every defendant is presumed innocent until proven guilty beyond a reasonable doubt.

A civil complaint is merely a set of allegations that, if the case were to proceed to trial, the government would need to prove by a preponderance of the evidence.

WILMINGTON, Del. – Dalton R. Truitt, 32, of Bridgeville, Del., and Kentae D. Watts, 29, of Bridgeville, Del., were each sentenced to seven (7) years of imprisonment for their roles in in a Seaford, Del. home invasion committed on May 1, 2014, announced Charles M. Oberly, III, United States Attorney for the District of Delaware.  Truitt and Watts were also sentenced to five (5) years of supervised release following their prison sentences.

According to statements made at the sentencing hearings and other documents filed in court, shortly after midnight on May 1, 2014, Truitt, Watts, and two other men went to the Seaford, Delaware residence of Kevin Barnes and his girlfriend Laura Taylor with the intent to steal Barnes’ heroin stash and money at gunpoint.

Through a window, Barnes caught a glimpse of one of the robbers outside his house, carrying an assault-type rifle.  He told his girlfriend to call 911 (which she did, from the bedroom closet), and he armed himself with a handgun.  Watts then kicked down the door, at which point Barnes opened fire.  All four robbers fled.  At least one of them returned fire towards the house.

Police arrived shortly thereafter and pulled over Watts and Truitt in a car nearby.  The other two robbers got away.  Inside the car that Watts and Truitt were in, officers found two 9mm magazines and black clothing.  Inside Barnes’ residence, officers found three handguns, as well as over 100 grams of heroin and $5,000 in cash – all of which Barnes admitted belonged to him.  An assault-type rifle, handgun, and machete were discarded by the fleeing robbers and later recovered in the area.

Barnes pleaded guilty to drug and gun charges related to the incident, for which he was sentenced on October 15, 2015, to 80 months of imprisonment, to be followed by four (4) years of supervised release.

The case is the product of an investigation conducted by the Wilmington Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Delaware State Police, and the Dover Police Department.  Assistant United States Attorney Elizabeth L. Van Pelt and former Assistant United States Attorney Mark M. Lee prosecuted the case on behalf of the United States.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that an Indictment was unsealed today, charging Ishmael Rodriquez, age 30, of Wilmington, Delaware, with wire fraud, and conspiracy.  The Indictment also charges Christopher Ross, age 47, of Seaford, Delaware with wire fraud, conspiracy, interstate transportation of stolen property, and money laundering.  Both men face up to 20 years in prison on the wire fraud and conspiracy charges, in addition to possible fines and restitution.  Ross faces up to 10 years on the remaining counts. 

The Indictment alleges that, from April through October 2014, Rodriquez, Ross, and others, conspired with one another to devise a fraudulent scheme involving the delivery of stolen automobile batteries to local recycling businesses.  It is alleged that the two men used rental trucks to remove thousands of used automobile batteries from the warehouse of a trucking company in Middletown, Delaware.  It is further alleged that they delivered the used batteries to recycling businesses in Delaware and Maryland, in exchange for at least $449,000, in cash and checks.

According to the Indictment, Ross transported thousands of pounds of stolen batteries across state lines, to a recycling business in Maryland.  It is specifically alleged that he transported more than 24,000 pounds of batteries to Maryland on October 8, 2014, in exchange for payment of $6,960 in cash.  It is alleged that he transported more than 34,000 pounds of batteries to Maryland October 15, 2014, for payment of $22,011 in cash; and he transported more than 38,000 pounds of batteries to Maryland October 16, 2014, for payment of $10,685 in cash.  The Indictment alleges that Ross used $20,200 in cash proceeds to purchase a commercial tractor trailer from a dealership in New Castle, Delaware.

This case is the result of an investigation conducted by the United States Postal Inspection Service and the Internal Revenue Service.

The charges in the Indictment are only allegations.  The defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

WILMINGTON, Del. – Today, a federal grand jury returned a Second Superseding Indictment adding the Wilmington Trust Corporation as a defendant to the indictment already pending against four former senior bank executives, David Gibson, Robert V.A. Harra, William North, and Kevyn Rakowski, for their respective roles in concealing from the Federal Reserve, the Securities and Exchange Commission (SEC) and the investing public the total quantity of past due loans on Wilmington Trust’s books from October 2009 through November 2010.  The Nineteen-Count Second Superseding Indictment (15-23-RGA) charges defendants with making false statements in securities filings and to agencies of the United States government. 

Wilmington Trust was required to report in its quarterly filings with both the SEC and the Federal Reserve the quantity of its loans for which payment was past due for 90 days or more. Investors and banking regulators consider the amount of past due loans at a bank as an important metric in evaluating the health of a bank’s loan portfolio.  According to the Second Superseding Indictment, Wilmington Trust, through the actions of the charged senior executives, concealed the truth about the health of its loan portfolio from the SEC, the investing public and from Wilmington Trust’s regulators.  During the course of the alleged conspiracy, in February 2010, Wilmington Trust raised approximately $273.9 million through a public stock offering.  

In November 2010, Wilmington Trust announced an agreement to be acquired by M&T Bank Corporation, at a price of $3.84 per share, a discount of approximately 46% from the bank’s share price the prior trading day, and approximately $9.41 per share less than at the time of Wilmington Trust’s capital raise in February 2010.  This decline in price, between February and November 2010, represented a loss of $204 million in total market value of the shares bought during the capital raise.  The acquisition was completed on May 16, 2011, and Wilmington Trust Corporation became a wholly owned subsidiary of M&T Bank, which assumed both its assets and liabilities.  The criminal conduct set forth in the Second Superseding Indictment predated M&T Bank’s acquisition of Wilmington Trust and related solely to Wilmington Trust’s commercial banking operations.

I did not make the decision lightly to seek charges against the Wilmington Trust Corporation.  Ultimately, I have determined that bringing the Second Superseding Indictment is necessary to achieve justice and attempt to make whole those members of our community who suffered significant financial harm as a result of the alleged criminal conduct perpetrated by Wilmington Trust Corporation and its multiple senior bank officers.  Wilmington Trust Corporation had an obligation, to its shareholders and to the public, to accurately report the important financial metrics which enable investors to make informed decisions.  Difficult financial times may present significant business challenges, but they do not excuse anyone or any entity from complying with the law.  Wilmington Trust received $330 million in TARP funds and is the first TARP recipient institution to be indicted.

I am grateful to the Federal Bureau of Investigation, the Special Inspector General for the Troubled Asset Relief Program, the Internal Revenue Service’s Criminal Investigative Division, the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau for their diligent and thorough investigation of these matters, as well as to the staff of the United States Attorney’s Office for their hard work and commitment to achieving justice.

Finally, I remind everyone that, as always, the charges contained in an indictment are merely accusations, and a corporate defendant, like an individual, is presumed innocent unless and until proven guilty.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Victor Kwabenda Adofo Asante, a.k.a.Victor Asante, age 25, formerly of Newark, Delaware, was sentenced today by the Honorable Leonard P. Stark, United States District Judge for the District of Delaware, to 39 months imprisonment and full restitution in the amount of $259,342.00.  The defendant pleaded guilty to False Claims and Bank Fraud Conspiracy in June 2015. 

According to court filings and statements at the sentencing hearing, the defendant and others used stolen identities to file fraudulent federal income tax returns with the Internal Revenue Service.  The defendant obtained some of the stolen identities by convincing an associate to steal personal information from patients of her employer, a neuro-rehabilitation center.  The defendant also participated in bank fraud activities.  He and others compromised, and stole money from, unsuspecting victims’ credit card, annuity, and other financial accounts. 

The defendant concealed his involvement in the fraudulent activity by, among other things, receiving fraud proceeds into bank accounts he opened or controlled in other people’s names, withdrawing the proceeds in cash, transferring the funds to other bank accounts, and exchanging the funds with others through money orders and checks.

Two of the defendant’s separately charged co-conspirators were previously sentenced by the court.  In February 2015, James Ekeke, age 26, of Smyrna, Georgia, pleaded guilty to false claims conspiracy and access device fraud.  Ekeke was sentenced in June 2015 to serve 54 months in prison.  In May 2015, Festus Frimpong, age 20, of Newark, Delaware, pleaded guilty to false claims conspiracy and access device fraud.  Frimpong was sentenced in October 2014, to serve 46 months imprisonment. 

An additional co-conspirator, Natasha Pollard, awaits sentencing.  She pleaded guilty to aiding and abetting receipt of stolen government property, and bank fraud conspiracy, in October 2015.

A fourth co-conspirator, Amaserwaah Asante, awaits trial on March 28, 2016.  She was charged by a Superseding Indictment dated March 12, 2015, with false claims conspiracy, money laundering, and bank fraud conspiracy.

U.S. Attorney Oberly gave the following comments: “Frauds like this have become all too common and are costing the government huge sums of money. My office is committed to prosecuting those engaged in this kind of criminal behavior and to seeking substantial periods of imprisonment to serve as a deterrent to others who might want to attempt to commit the same or similar frauds. I personally want to thank the federal agencies, investigators and Assistant United States Attorney who worked diligently to bring Mr. Asante and his co-defendants to justice.”

“Defendant Victor Ofosu-Asante demonstrated a blatant disregard of the integrity of the United States tax system. Rest assured that IRS Criminal Investigation, along with our law enforcement partners, and the U.S. Attorney's Office, will hold those who engage in similar behavior fully accountable." said Akeia Conner, Special Agent in Charge.

These cases are the result of an ongoing investigation conducted by the Internal Revenue Service Criminal Investigation, the United States Postal Inspection Service, and the Social Security Administration Office of the Inspector General.

WILMINGTON, Del. - Old Towne Physical Therapy LP has agreed to a $710,000 settlement with the government to resolve allegations of health care fraud arising under the False Claims Act.  Old Towne Physical Therapy is an outpatient physical therapy practice that owns three clinics in Delaware.  The United States contends that Old Towne improperly billed Medicare for physical therapy services.  The settlement was announced today by United States Attorney Charles M. Oberly, III. 

Allegedly, from August 1, 2007 through November 13, 2009, Old Towne submitted claims to Medicare for physical therapy services performed at the Old Towne clinics by physical therapists and physical therapist assistants without the adequate supervision by a Medicare-enrolled physical therapist, as required by Medicare rules.  As part of the resolution of this case, Old Towne and its parent company, U.S. Physical Therapy, Inc., entered into a Corporate Integrity Agreement with the Department of Health and Human Services’ Office of Inspector General.

"The United States Attorney's Office for the District of Delaware is to committed to ensuring that Medicare beneficiaries receive the quality health care they deserve, and that the government gets what it pays for," said Oberly.  "When providers cut corners by failing to ensure that procedures are adequately supervised, it cheats both the patients and the government."

This case was investigated by the United States Attorney's Office for the District of Delaware and the United States Department of Health and Human Services' Office of Inspector General.  Within the United States Attorney's Office, the case was handled by Assistant United States Attorneys Jennifer Hall and Shannon Hanson, and Auditor Lawrence Kutys.

WILMINGTON, Del. – United States District Court Judge Richard G. Andrews sentenced Edwin Hernandez, 46, of Wilmington, Del. to 18 months in prison followed by 4 years of supervised release, and Hector Hernandez, 37, of New Castle, Del., to 60 months in prison followed by 4 years of supervised release.  Both men pled guilty yesterday to charges relating to the attempted distribution of a half-kilogram of cocaine in Wilmington, Del. 

The sentences were announced by United States Attorney for the District of Delaware Charles M. Oberly, III and Gary Tuggle, Special Agent in Charge of the Philadelphia Field Division of the Drug Enforcement Administration (DEA).

According to statements made at the sentencing hearings and documents filed in court, Edwin and Hector Hernandez, who are brothers, conspired to distribute a significant amount of cocaine.  Edwin Hernandez was arrested on February 5, 2015, in the CVS Pharmacy parking lot at 1005 Delaware Avenue in Wilmington, Delaware.  At the time of his arrest, while on duty as Maintenance Superintendent for the Wilmington Housing Authority, Edwin Hernandez was in possession of more than 500 grams of cocaine, which is valued at over $50,000.  The cocaine was found in a Wilmington Housing Authority van.  Hector Hernandez was arrested at the same time, nearby in his own vehicle, while in possession of a loaded handgun.  Hector Hernandez later admitted to supplying his brother with the cocaine earlier that day.

Edwin Hernandez worked at the Wilmington Housing Authority for 24 years.  His employment was terminated after his arrest in this case.

The case is the product of an investigation conducted by the Drug Enforcement Administration (“DEA”) Drug Trafficking Task Force, which is part of the New Castle County HIDTA, a collaborative effort among federal, state, and local law enforcement agencies.  The DEA Drug Trafficking Task Force includes members from the following agencies: DEA, Delaware State Police, New Castle County Police Department, Newark Police Department, Department of Homeland Security – Homeland  Security Investigations, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Delaware Attorney General’s Office.  Assistant United States Attorney Elizabeth L. Van Pelt prosecuted the case on behalf of the United States.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Penni Enama, age 50, of Lewes, Delaware, pled guilty to one count of wire fraud, in violation of 18 U.S.C. § 1343, and one count of tax evasion, in violation of 26 U.S.C. §7201.  Enama, who will be sentenced on March 23, 2016, at 2 p.m. by the Honorable Gregory M. Sleet, United States District Judge for the District of Delaware, faces a maximum sentence of twenty years in prison, a fine of $250,000, and 3 years of supervised release following any term of imprisonment.

According to statements made at the plea hearing and documents filed in court, Enama was employed by a law firm in Delaware, for approximately two years when, in May 2007, she began embezzling funds from the firm’s escrow account.  Enama was a real estate paralegal, and she used her access to a closing escrow account to divert at least $439,824.40 to her personal use.  Enama fabricated additional real estate closing parties in the firm’s records, and she used the additional funds to pay her personal credit cards and/or deposit the funds into her personal bank accounts.  Enama did not declare the embezzled funds on her federal income tax returns for the 2011-2013 tax years. 

U.S. Attorney Oberly commented, “This is a particularly troublesome case where an experienced para-professional abused her position of trust to steal, at least, nearly $440,000.00 from a Delaware law firm. Whether it is a law firm, a physician’s office, or any office where people are entrusted with handling money, thieves like Ms. Enama can expect to be prosecuted and face incarceration.”

 “To build faith in our nation’s tax system, honest taxpayers need to be reassured that everyone is paying their fair share. The overarching principle of IRS' enforcement strategy is simply this: We protect the integrity of the tax system by ensuring everyone pays the right amount of tax,” said Akeia Conner, Special Agent In Charge IRS Criminal Investigation.

This case is being investigated by the Internal Revenue Service - Criminal Investigation, and it is being prosecuted by Assistant United States Attorney Lauren Paxton.

WILMINGTON, Del. – A federal grand jury in Wilmington, Delaware, indicted a resident of Church Hill, Maryland, today on one count of attempting to transfer obscene materials to a minor, U.S. Attorney Charles M. Oberly III of the District of Delaware announced today. 

Lee Robert Moore, 37, was employed by the U.S. Secret Service-Uniformed Division and was assigned to the White House at the time of his arrest.  Moore was arrested on Nov. 9, 2015, and has remained in custody since that time.

According to the indictment and court documents filed in the case, Moore allegedly maintained a profile on the social media application “Meet24,” which provides a mobile-based platform for exchanging digital images, as well as voice and text messages.  Delaware State Police Detectives with the Delaware Child Predator Task Force created a profile on this site, posing as a 14-year-old girl, with whom Moore allegedly engaged in a number of online chat sessions, via the “Meet24” and “Kik” mobile apps over a two-month period, including while Moore was at work.  A number of the online chats allegedly between Moore and the supposed female minor were sexual in nature and, on several occasions, Moore allegedly sent pictures of himself, including one depicting his penis. 

U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Delaware Child Predator Task Force conducted the investigation.  Trial Attorney Amy E. Larson of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Edward J. McAndrew of the District of Delaware are prosecuting the case. 

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

A federal grand jury in Wilmington, Delaware, indicted a resident of Church Hill, Maryland, today on one count of attempting to transfer obscene materials to a minor, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Charles M. Oberly III of the District of Delaware announced today. 

Lee Robert Moore, 37, was employed by the U.S. Secret Service-Uniformed Division and was assigned to the White House at the time of his arrest.  Moore was arrested on Nov. 9, 2015, and has remained in custody since that time.

According to the indictment and court documents filed in the case, Moore allegedly maintained a profile on the social media application “Meet24,” which provides a mobile-based platform for exchanging digital images, as well as voice and text messages.  Delaware State Police Detectives with the Delaware Child Predator Task Force created a profile on this site, posing as a 14-year-old girl, with whom Moore allegedly engaged in a number of online chat sessions, via the “Meet24” and “Kik” mobile apps over a two-month period, including while Moore was at work.  A number of the online chats allegedly between Moore and the supposed female minor were sexual in nature and, on several occasions, Moore allegedly sent pictures of himself, including one depicting his penis. 

U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Delaware Child Predator Task Force conducted the investigation.  Trial Attorney Amy E. Larson of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Edward J. McAndrew of the District of Delaware are prosecuting the case. 

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

WILMINGTON, Del. – Charles M. Oberly III, United States Attorney for the District of Delaware, today announced multiple guilty pleas to conspiracy to distribute heroin from within B&D Detailing, an auto detailing shop adjacent to the now-shuttered Thunderguards Clubhouse on Northeast Boulevard in Wilmington. 

Daywine Hunter, 32, of Wilmington, pled guilty on November 18, 2015 to participating in the aforementioned conspiracy, in violation of Title 21 United States Code Section 841(a)(1), (b)(1)(B) and 846.  The investigation focused on Hunter, a member of the Thunderguards Motorcycle Club and the owner of B&D Detailing.  Hunter and his father, Victor Williams, both sold heroin from B&D Detailing during the investigation. 

Victor Williams, 54, Brian Teat, 53, Prince Seward, 51, Jaquanda Lewis-Davis, 22, all of Wilmington, and Yanthonic Herrera, 23, of Philadelphia, were also arrested as part of the heroin conspiracy.  Williams, Teat, and Seward have also pled guilty to their participation in the heroin distribution ring, headed by Hunter.

Pursuant to federal wiretap orders, Drug Enforcement Administration agents intercepted Hunter’s telephone calls.  Agents also covertly installed and monitored video and audio surveillance equipment, commonly referred to as “bugs”, from inside B&D Detailing.  This electronic surveillance continued until the defendants’ arrests on April 22, 2015.

According to statements made by the government during court hearings in this case, Hunter used Williams and his co-defendants Teat, Seward, and Lewis-Davis as drug couriers.  Hunter ordered the couriers to travel to Philadelphia in vehicles equipped with hidden compartments to pick up in excess of 100 grams of heroin per trip from Hunter’s heroin source of supply.  These trips occurred weekly.

On April 22, 2015, the day after the couriers made a trip to Philadelphia, video surveillance caught a Lincoln Aviator with a hidden compartment as it backed into B&D Detailing.  Hunter was then seen removing a shopping bag from the Navigator.  Officers executed a search warrant at B&D Detailing and recovered the bag, which was found to contain in excess of 100 grams of heroin packaged for distribution. 

United States Attorney Charles M. Oberly, III, said, “This case is the result of a tremendous partnership fostered by the New Castle County High Intensity Drug Trafficking Area (“HIDTA”).  Virtually every law enforcement agency in the region contributed to the takedown of a significant heroin drug trafficking group.  We will continue to use every resource available to fight heroin trafficking here in Delaware.”

"Investigations where the DEA works with its partners from other law enforcement agencies to dismantle a heroin drug trafficking organization like this are a top priority for my office and the DEA across the country," said Gary Tuggle, the Special Agent in Charge of the DEA's Philadelphia Field Division, which encompasses Delaware.  "Heroin abuse is destroying numerous lives and families across our region.  The DEA will remain vigilant in using all of its technological resources to aggressively target heroin traffickers as was done here."

This case is the result of an investigation conducted by the Wilmington Resident Office of the Drug Enforcement Administration, HIDTA Group 41, the Delaware State Police, the Wilmington Police Department, the Newark Police Department, New Castle County Police Department, Delaware Probation and Parole, and the Department of Homeland Security, Homeland Security Investigations.  The prosecution is being handled by Assistant United States Attorney Jennifer K. Welsh.

WILMINGTON, Del – Kevin Chambers, 39, of Austell, Georgia, was indicted by a federal grand jury on November 12, 2015 for trafficking heroin and cocaine, announced Charles M. Oberly, III, United States Attorney for the District of Delaware.

According to the criminal complaint, on or about October 26, 2015, Chambers conspired to distribute a kilogram of heroin and a kilogram of cocaine.  Then, on November 4, 2015, Chambers was arrested at Harrah’s Casino in Chester attempting to obtain two additional kilograms of cocaine.  The defendant faces a maximum penalty of 20 years imprisonment, a 5 year mandatory minimum term of imprisonment, at least 3 years of supervised release, a fine of up to $1,000,000 and a $100 special assessment, if convicted.

The case was investigated by the DEA Wilmington Resident Office – HIDTA Group 41.  Special Assistant United States Attorney Christopher L. de Barrena-Sarobe is prosecuting the case on behalf of the United States.

Indictments are only charges and are not evidence of guilt.  A defendant is presumed to be innocent until and unless proven guilty.

WILMINGTON, Del. – A former U.S. Navy Lt. Commander and ordained Catholic priest pleaded guilty in U.S. District Court for the District of Delaware to one count of production of child pornography and one count of distribution of child pornography, announced U.S. Attorney Charles M. Oberly III of the District of Delaware.

John Thomas Matthew Lee, 50, of Millsboro, Delaware, pleaded guilty today before Chief U.S. District Court Judge Leonard P. Stark of the District of Delaware.  A sentencing hearing is scheduled for March 2, 2016 at 10:00 a.m.  Lee is a registered sex offender following his 2007 conviction in a general court martial of sexually assaulting another Naval officer while serving as a Chaplain at its United States Naval Academy.  Lee has been in custody since his November 3, 2014 arrest. 

Following a series of CyberTipline reports from the National Center for Missing and Exploited Children, U.S. Immigration and Customs Enforcement-Homeland Security Investigations (ICE-HSI) agents were able to trace to Lee accounts that were being used to upload images of child pornography to several social networking sites.  In executing a search warrant at Lee’s residence in Millsboro, agents found tens of thousands of child-pornography images on several of Lee’s electronic devices, including his phone.  Via online messenger applications and text messages, Lee also used his phone to induce several juveniles to send him pornographic images of themselves.  Lee uploaded at least one of these images to a publicly accessible social media site.  He also traded other images of child pornography online with other adults. 

U.S. Attorney Oberly stated, “I commend all the investigators and prosecutors who have played a role in bringing this second offender to justice.  As a predator focusing his attention on children, Mr. Lee can expect to spend many years, if not the remainder of his life, in prison.  The Government’s efforts to rid society of those who exploit and abuse children is of the highest priority and we will continue to seek out these criminals.”

This case is being investigated by the Department of Homeland Security, Homeland Security Investigations, and is being prosecuted by Assistant United States Attorney Edward J. McAndrew.

A former U.S. Navy Lt. Commander and ordained Catholic priest pleaded guilty in U.S. District Court for the District of Delaware to one count of production of child pornography and one count of distribution of child pornography, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Charles M. Oberly III of the District of Delaware.

John Thomas Matthew Lee, 50, of Millsboro, Delaware, pleaded guilty today before Chief U.S. District Court Judge Leonard P. Stark of the District of Delaware.  A sentencing hearing is scheduled for March 2, 2016.  Lee is a registered sex offender following his 2007 conviction in a general court martial of sexually assaulting another Naval officer.  Lee has been in custody since his arrest on Nov. 3, 2014.

Following a series of CyberTipline reports from the National Center for Missing and Exploited Children, U.S. Immigration and Customs Enforcement-Homeland Security Investigations (ICE-HSI) agents were able to trace to Lee accounts that were being used to upload images of child pornography to several social networking sites.  In executing a search warrant at Lee’s residence in Millsboro, agents found tens of thousands of child-pornography images on several of Lee’s electronic devices, including his phone.  Via online messenger applications and text messages, Lee also used his phone to induce several juveniles to send him pornographic images of themselves.  Lee uploaded at least one of these images to a publicly accessible social media site.  He also traded other images of child pornography online with other adults. 

This investigation was conducted by ICE-HSI Resident in Charge Wilmington, Delaware, with assistance from several other ICE-HSI regional offices to locate and interview the juvenile victims.  This case is being prosecuted by Trial Attorney Herbrina D. Sanders of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Edward J. McAndrew of the District of Delaware.

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

WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Kent Buckson, age 36, of Newark, Delaware, was sentenced today by United States District Court Judge Sue L. Robinson to 70 months incarceration for 14 robberies, eight occurring in Delaware, three in Pennsylvania and three in Maryland.

According to statements made at the sentencing hearing and documents filed in court, over an approximate six-week period beginning in June 2014, in a tri-state area Buckson robbed six stores, three pharmacies, and five banks, as follows:

DATE

LOCATION

June 8

7-Eleven, Elkton, MD

June 10

Lampost Liquors

June 12

7-Eleven, 100 Four Seasons Parkway, Newark, DE

June 13

7-Eleven 284 Christiana Road, Newark, DE

June 15

Rite Aid, Bear, DE

June 17

Wawa, Newark, DE

June 18

Sunoco Mini-Mart, Chadds Ford, PA

June 19

WSFS, Bear, DE

July 5

Wells Fargo, Lancaster, PA

July 8

PNC Bank, Glen Mills, PA

July 10

PNC Bank, Wilmington, DE

July 17

Rite Aid, Millsboro, DE

July 17

Rite Aid, Delmar, MD

July 23

National Penn Bank, Rising Sun, MD

In each of the store robberies, Buckson wore a mask and brandished a knife.  In the two pharmacy robberies of July 17, 2014, committed four hours apart, Buckson robbed the clerks of approximately 1,236 Oxycodone pills, having a value of over $4,000.00.

In each of the five bank robberies and the two pharmacy robberies of July 17, 2014, Buckson disguised himself as a woman and presented the teller/clerk a note threatening a gun and the shooting of the teller/clerk.  In addition, to the value of the Oxycodone pills, Buckson’s robberies resulted in financial losses of $25,250.00.  When Buckson was arrested, $31,125.00 was recovered from the robbery at the National Penn Bank in Rising Sun, Maryland.

Following the sentencing, Charles M. Oberly, III, United States Attorney for the District of Delaware, stated, “This serious multi-state crime spree was ended and Buckson apprehended in Newark, Delaware on July 24, 2014, due to the swift and cooperative efforts of the Delaware State Police, Pennsylvania State Police, Maryland State Police, Elkton, Maryland Police Department, and Delmar, Maryland Police Department.”

“A dangerous criminal has been brought to justice after the determined work of investigators.  The work of law enforcement is only as good as the partnerships we create and maintain, and this case proves that to be true,” said Kevin Perkins, Special Agent in Charge of the FBI in Wilmington.  

This case was investigated by the Delaware State Police, Pennsylvania State Police, Maryland State Police, Elkton, Maryland Police Department, Delmar, Maryland Police Department, and the Federal Bureau of Investigation.  It is being prosecuted by Assistant United States Attorney Edmond Falgowski.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Damien Piper, age 34, of Wilmington, Delaware, pled guilty today to violations of 18 U.S.C. § 666 (Theft of Public Funds).  Piper, who will be sentenced on February 2, 2016, by the Honorable Gregory M. Sleet, United States District Judge for the District of Delaware, faces a maximum sentence of ten years in prison, a fine of $250,000, and 3 years of supervised release.

According to statements made at the plea hearing and documents filed in court, the defendant was an Assistant Site Manager for the Wilmington Housing Authority’s Crestview Apartments.  In February 2012, he began converting residents’ rental payments to his personal use.  Residents often paid their rent by money order.  Piper received and altered the money orders, making them payable to himself.  Piper deposited the money orders into bank accounts he owned and controlled, and he cashed some of the money orders at check cashing businesses.

From February 10, 2012, and continuing up to and including October 7, 2014, Piper took more than 700 money orders that were designated for the Housing Authority, and he obtained at least $179,000.  Piper altered the Housing Authority’s computerized records to conceal the converted payments as “adjustments.”  These altered Housing Authority records indicated that less rent was due from the residents.  In fact, Piper collected the full amount of rent from the residents and kept the “adjustment” amount for himself.”

U.S. Attorney Oberly commented:  “I personally want to thank everyone involved who made this prosecution possible.  Those who think they can commit crimes like this will be prosecuted and punished accordingly.”

This case is the result of an investigation conducted by the U.S. Department of Housing & Urban Development, Office of Inspector General, and the United States Postal Inspection Service.  The case is being prosecuted by Assistant United States Attorney Lauren Paxton.

WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced today that Salvatore Leone, age 52, of Dover, was sentenced today by U. S. District Court Judge Gregory M. Sleet to 1 year and one day of imprisonment and 3 years of supervised release.  Mr. Leone was also ordered to pay restitution in the amount of $784,568.00 to the Wilmington Trust Company.

The sentencing came after Mr. Leone pleaded guilty on October 7, 2013, to one count of conspiracy to commit bank fraud, in violation of 18 U.S.C. § 1349.

Leone was a project manager for and partner with a prominent developer in several limited liability companies formed for the purpose of developing real estate in or around Dover, Delaware.  Between September 24, 2007 and February 27, 2009, Leone and others submitted, or caused to be submitted, false draw requests to Wilmington Trust Company totaling approximately $483,568,000.00.  In addition, defendant misappropriated an escalated lease payment totaling $260,000.00.

U.S. Attorney Oberly stated,  “The sentence handed down by the Court was justified. Mr. Leone defrauded a financial institution out of a substantial sum of money for his personal gain.  Today’s sentence reflects accountability for those actions.  Those who seek to enrich themselves at the expense of financial institutions and those institutions’ shareholders will be prosecuted by this office and brought to face the consequences of their unlawful actions.”

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service Criminal Investigation Division, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), and the Office of Inspector General, Board of Governors of the Federal Reserve System and is being prosecuted by Assistant United States Attorneys Lesley Wolf and Robert Kravetz.

WILMINGTON, Del. – Amanda Carey, age 28, of New Castle, Del., pleaded guilty today to embezzling over $150,000 from a PNC Bank location in Greenville, Del., announced Charles M. Oberly, III, United States Attorney for the District of Delaware.  Carey, who will be sentenced on February 3, 2016, by the Honorable Richard G. Andrews, United States District Judge for the District of Delaware, faces a maximum sentence of 30 years imprisonment, a $1,000,000 fine, and 5 years of supervised release following her prison sentence.

According to statements made at the plea hearing today and documents filed in court, Carey embezzled approximately $150,000 from PNC Bank over the course several months this year.  She was employed as a teller supervisor at the bank, beginning in January 2015.  On June 19, 2015, Carey did not report to work as scheduled.  An audit of the bank’s vaults was conducted, and the bank learned that over $150,000 of cash was missing.  An arrest warrant was issued for Carey on July 10, 2015, and she was arrested in Emporia, Virginia on July 28, 2015.

This case is being investigated by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorneys Lauren Paxton and Elizabeth L. Van Pelt, with the cooperation and assistance of PNC Bank Investigative Services Group.

WILMINGTON, Del. – The United States announced today that it has settled claims under the False Claims Act with St. Francis Hospital for improperly billing Medicare and Medicaid for patients admitted into its inpatient rehabilitation unit in Wilmington, Delaware between 2007 and 2010, when admission was not medically necessary and/or the services provided did not fully qualify for reimbursement.  St. Francis closed the inpatient rehabilitation unit in early 2011.  The settlement agreement also resolves separate allegations that St. Francis employed an individual who was excluded from participating in any Federal health care programs. 

After it discovered the issues, St. Francis took corrective action to resolve the improper payments, and voluntarily disclosed the issues to the United States Attorney’s Office and the Office of the Inspector General of the Department of Health and Human Services.  St. Francis has agreed to pay $4,081,816.00 to the United States and $199,894.00 to the State of Delaware to resolve the matter.

“This resolution is an example of how voluntary self-disclosure benefits both the government and providers who report potential fraud and compliance problems,” said Charles M. Oberly, III, United States Attorney for the District of Delaware.  “The government was able to recover monetary damages for compliance issues that might not have been revealed without St. Francis’ self-disclosure, and St. Francis can move forward without concern about lingering liabilities related to this conduct.”

This matter was handled by Assistant United States Attorneys Jennifer Hall and Shannon Hanson, Deputy Attorney General Tiphanie Miller of the State of Delaware Medicaid Fraud Control Unit, and Lisa Veigel, an attorney with the United States Department of Health and Human Services Office of the Inspector General.

WILMINGTON, Del. – Carl McBride, age 50, of Claymont, Delaware, pleaded guilty earlier today to Receipt of Child Pornography, in violation of federal law.  Charles M. Oberly, III, United States Attorney for the District of Delaware, announced the guilty plea following a hearing in the United States District Court for the District of Delaware.

McBride faces a mandatory minimum sentence of at least five years, and up to twenty years, in prison, a fine of up to $250,000, and a term of supervised release of at least five years to life following his prison sentence.  He also will be required to register as a sex offender in any jurisdiction in which he resides, works or attends school.  United States District Judge Gregory M. Sleet has scheduled McBride’s sentencing hearing for December 29, 2015 at 10:00 a.m.

According to statements made and documents filed in court, a U.S. Department of Homeland Security special agent identified McBride while conducting an online undercover investigation into hidden, or “dark web,” child pornography trafficking networks.   That investigation revealed that McBride had utilized a hidden peer-to-peer computer network to distribute child pornography to over 150 individuals from his Claymont home.  After identifying McBride through computer network records, investigators discovered that another person residing at his Claymont residence was then providing daycare services out of the home under the name “Little Tykes Day Care.”

On November 5, 2013, federal law enforcement agents executed a search warrant at McBride’s Claymont home, and seized multiple computers and digital devices.  McBride was arrested that day after a forensic examination of a laptop computer found near a diaper changing table revealed over 28,000 files depicting photographs and movies of child pornography.  Most of these images depicted the violent sexual abuse of prepubescent girls.

During a post-arrest interview, McBride admitted to trafficking in child pornography, but claimed he was doing so in an effort to identify and help law enforcement agencies apprehend other child predators.  McBride admitted, however, that he had not contacted any law enforcement agencies about his ‘efforts’ to catch online predators, adding that he was “almost done collecting the evidence” at the time of the search and his arrest.  McBride has been held in federal custody since then.  The Office of Child Care Licensing suspended the daycare operator’s license the same day.

This case was investigated by the United States Department of Homeland Security, Homeland Security Investigation.  It is being prosecuted by Assistant United States Attorney Edward J. McAndrew.

WILMINGTON, Del. – United States District Court Judge Richard G. Andrews sentenced Michael Nolting, age 25, of Newark, Delaware to 36 months in prison followed by three years of supervised release.  Nolting had pled guilty to making false statements to a licensed firearms dealer in the acquisition of a firearm.

The sentence was announced by United States Attorney for the District of Delaware Charles M. Oberly, III and William McMullan, Special Agent in Charge of the Baltimore Office of the Bureau of Alcohol, Tobacco and Firearms (ATF).

According to statements made at the sentencing hearing and documents filed in court, over an approximate four week period beginning in July 2014, Nolting, then a heroin user, straw purchased a total of five semi-automatic pistols for his several heroin suppliers, falsely denying that he was a drug user, and fraudulently purporting that he was the actual purchaser, when, in fact, he knew the drug dealers were the actual purchasers.

A “straw purchase” occurs when an individual who is not eligible to lawfully purchase a firearm solicits another person to conduct the transaction. Among other requirements, ATF Form 4473 required Nolting to certify that he was the actual buyer of the firearms and that he was not using any unlawful drugs.

“It is a violation of federal law to make a false statement in order to purchase a firearm.  It is even more egregious to supply illegally obtained firearms to drug dealers,” said U.S. Attorney Charles M. Oberly, III.

William McMullan, Special Agent in Charge of the Baltimore Office of the Bureau of Alcohol, Tobacco and Firearms said, “ATF’s primary mission is to target violent criminals who illegally possess firearms as well as those who help to arm criminals.  This case is an example of ATF’s commitment to identifying individuals who illegally purchase firearms for prohibited persons and then holding them accountable for their actions.” 

This case was prosecuted by Edmond Falgowski and investigated by the special agents and task force officers of the Wilmington Office of the ATF.

WILMINGTON, Del. – Robert V.A. Harra, age 66, of Wilmington, David Gibson, age 58, of Wilmington, William North, age 55 of Bryn Mawr, Pennsylvania, and Kevyn Rakowski, age 61, of Lakewood Ranch, Florida, were indicted today for their respective roles in concealing from the Federal Reserve, the Securities and Exchange Commission (SEC) and the investing public the total quantity of past due loans on Wilmington Trust’s books from October 2009 until November 2010.  The Nineteen-Count Superseding Indictment charges defendants with making false statements in securities filings and to agencies of the United States government.

All defendants are charged with conspiracy to defraud the United States, to commit fraud in connection with the purchase and sale of securities, and making false statements to regulators  (18 U.S.C. § 371).  All defendants are charged with one count of false statements in connection with the purchase or sale of securities (18 U.S.C. § 1348), four counts of making false entries in banking records (18 U.S.C. § 1005), seven counts of making false statements to agencies of the United States government (18 U.S.C. § 1001), and two counts of making false statements in SEC reports (15 U.S.C. §§ 78m(a) and 78ff).  Harra and Gibson are also charged with two additional counts of making false statements in SEC reports and Gibson is charged with three counts of falsely certifying financial reports (18 U.S.C. § 1348).  North and Rakowski were previously charged with two counts of making false statements to an agency of the United States, relating to the concealment from the market and the Federal Reserve the total quantity of past due loans on the bank’s books during the months of October and November 2009.

Wilmington Trust was required to report in its quarterly filings with both the SEC and the Federal Reserve the quantity of its loans for which payment was past due for 90 days or more. Investors and banking regulators consider the 90-day number in evaluating the health of a bank’s loan portfolio.  According to the Superseding Indictment, Harra, Gibson, North, and Rakowski helped conceal the truth about the health of Wilmington Trust’s loan portfolio from the SEC, the investing public and from the bank’s regulators.

The Superseding Indictment alleges that Harra, Gibson, North, and Rakowski participated in Wilmington Trust’s failure to include in its reporting a material quantity of past due loans, despite the reporting requirements and knowing the significance of past due loan volume to investors and regulators.  North, as the bank’s Chief Credit Officer, approved the exclusion or “waiver” of such loans from internal reports that he knew would be used to generate the bank’s external financial reports.  As the bank’s President and Head of Regional Banking, Harra encouraged the “waiver” of past due loans.  He served as a primary point of contact with the bank’s regulators during 2009 and 2010, signed bank regulatory filings, participated in quarterly earnings calls with investors, and did not disclose the bank’s failure to report “waived” loans.  The Chief Financial Officer, Gibson, also knew the bank had “waived” loans from public reporting and failed to disclose this.  Despite this knowledge, Gibson helped to draft and approved SEC filings and certified that those same filings fairly presented the financial condition of Wilmington Trust.  Rakowski, as Controller, approved the bank’s filings with the SEC and the Federal Reserve knowing that those reports did not include past due loans that had been “waived.”

In November 2010, Wilmington Trust was acquired by another bank at a discount of approximately 46% from the bank’s share price the prior trading day.

In announcing the Superseding Indictment, United States Attorney for the District of Delaware Charles M. Oberly, III, stated, “This Superseding Indictment marks the next significant step in our investigation into the illegal conduct by at Wilmington Trust.  The failure by these individuals to properly inform regulators and investors about the true financial condition of Wilmington Trust resulted in significant harm to those investors and losses to the Delaware community.  As high-ranking bank executives, these individuals had an obligation to accurately report important financial metrics which enable investors to make informed decisions.  Even in the wake of the financial crisis, their deception was neither permissible nor excusable.”

“The deception explained in this indictment shows the defendants set out to hide information from the federal government.  The men and women named in this case not only hid financial details from regulators but from the general public and investors,” said acting Special Agent in Charge Scott Hinckley of the FBI in Delaware.  “These aren’t victimless crimes and those who committed them will be held accountable.”

“The criminal charges filed today allege that four senior executives of a TARP bank did not want to face the consequences of telling the truth about past due loans on the bank’s books, and in reporting to regulators, investors and shareholders,” said Christy Romero, Special Inspector General for TARP (SIGTARP).  “These TARP bankers allegedly engaged in a practice of waiving past-due loans from their external reports, and making mass extensions of past-due loans with limited – if any – underwriting and many lacking updated appraisals.  In 2008 Treasury, on behalf of American taxpayers, invested $330 million in TARP bailout funds in Wilmington Trust. In 2010, the bank then turned to the market to raise capital using its falsely reported past due numbers.  The bank was then sold at a severe discount, roughly half its discount from the prior day.  Bankers across the nation were faced with declining economic conditions and rising past-due loans, and told the truth about those loans and losses.  Bankers at Wilmington Trust did not.  We commend United States Attorney Charles Oberly, III and our law enforcement partners for standing firm with SIGTARP to combat TARP-related crime.”

“Bank executives hold positions of trust not only within their banks but also in the eyes of the public. That trust is broken when such executives abuse their power and commit crimes. This latest indictment should serve as a continued warning to anyone who is contemplating similar financial fraud, that their illegal activity will not go unnoticed” said Akeia Conner, Special Agent In Charge, IRS Criminal Investigation.

“Today’s indictment sends a clear message that bank executives who engage in fraud to deceive regulators and the public will be held accountable for their actions,” said Mark Bialek, Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau.The case is being investigated by the Federal Bureau of Investigation, the Department of Treasury’s Special Inspector General for the Troubled Asset Relief Program, the Internal Revenue Service’s Criminal Investigative Division, and the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau. The Securities and Exchange Commission has also contributed to the investigation. The case is being prosecuted by Assistant U.S. Attorneys Robert Kravetz and Lesley Wolf of the District of Delaware.

The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

WILMINGTON, Del. – Rogelio “Roger” Cordero, age 58, of New Castle, Delaware, was sentenced today by United States District Judge Sue L. Robinson to 262 months in federal prison for Receipt of Child Pornography, in violation of federal law. Cordero also was sentenced to a life term of supervised release following his prison sentence. He also will be required to continue to register as a sex offender in any jurisdiction in which he lives, works, or attends school.

Cordero was previously convicted in Delaware of Unlawful Sexual Intercourse, Unlawful Sexual Penetration and Unlawful Sexual Contact Second Degree in 1992. Those crimes involved Cordero’s sexual abuse of two female minors over an 18-month period. He was sentenced to 18 years in Delaware state prison, and 5 years of probation following his release. He was also ordered to undergo approximately 85 months of sex offender treatment. He was released from custody in December 2006, and committed the offenses at issue in the current case while on state probation.

According to statements made and documents filed in court, Cordero came to the attention of the Delaware Child Predator Task Force (the “Task Force”) after it began an investigation into two other registered child sex offenders living in Delaware. That investigation began in October 2012, after the Task Force received a cybertip from the National Center for Missing and Exploited Children (NCMEC). The cybertip reported that an AOL user, subsequently identified as Cordero, had transmitted numerous emails containing child pornography using AOL’s email service.

On December 20, 2012, Task Force officers executed a search warrant at Roger Cordero’s New Castle residence, where they found computers, smartphones and other digital devices containing thousands of images of child pornography featuring mostly prepubescent and adolescent children. They also found that Cordero had been trading child pornography with David Pennington, another registered child sex offender whom Cordero had met while both were incarcerated in the Smyrna Correctional Institution for child sex offenses. The men shared the images of child pornography by mailing digital photographs saved to thumb drives back and forth to one another. They also found a small, concealable “pen” camera that Cordero had used to record explicit footage of a minor child changing clothes.

Later on the day of December 20, 2012, Task Force officers executed a state search warrant at Pennington’s Georgetown residence. Pennington, who was then wearing an electronic monitoring device due to a state probation violation, was present for the search. During the search, Task Force members recovered evidence relating to the mailing of USB “thumb drives” containing child pornography and handwritten child sexual abuse stories between Pennington and Cordero. Pennington also informed the officers that he would view child pornography mailed to him by Cordero with another registered sex offender, William Zimmerman, of Georgetown, Delaware.

On January 8, 2013, Task Force officers executed a state search warrant at Zimmerman’s Georgetown residence. They recovered several pieces of computer equipment found to contain hundreds of images of child pornography. The images featured children ranging in age from infancy to mid-teen being posed or engaged in sexual acts with adult males.

Cordero is now the third member of the group to be sentenced for child exploitation crimes. On October 11, 2013, David Pennington was sentenced to 28 years in prison by Delaware Superior Court Judge T. Henley Graves after pleading guilty to Dealing in Child Pornography, in violation of Delaware law. On April 22, 2014, William Zimmerman was sentenced to the mandatory minimum term of 15 years in federal prison by United States District Judge Gregory M. Sleet after pleading guilty to Receipt of Child Pornography.

Following the sentencing hearing, United States Attorney Charles M. Oberly III said: “Cases like this are all too prevalent today. Mr. Cordero’s sentence should prevent him from ever exploiting another child. To those who are following in Cordero’s path, law enforcement is closing in on you, and when caught you should expect to be successfully prosecuted and sentenced to lengthy prison terms.”

“Homeland Security Investigations and our Delaware law enforcement partners stand vigilant against those who commit such heinous crimes," said John Kelleghan, HSI Philadelphia special agent in charge. "It’s also another example of the extraordinary collaborative efforts among law enforcement in Delaware to protect the most vulnerable among us."

Col. Nathaniel McQueen, Jr., Delaware State Police superintendent stated, "The Delaware law enforcement community was utilized in bringing these three child predators to justice.  This case revealed the most horrific images and videos of child sexcual exploitation.  This investigation encompassed areas from New Castle County to Sussex County.  Without the complete collaborative effort from the law enforcement community, this investigation would not have seen the successful service of justice that was issued against each child predator in this case."

This case, as well as those of Pennington and Zimmerman, was investigated by the Delaware State Police and the United States Department of Homeland Security, Homeland Security Investigations. All three cases were prosecuted by Assistant United States Attorney Edward J. McAndrew.

WILMINGTON, Del.  – A federal jury has convicted David T. Matusiewicz, his mother, Lenore Matusiewicz, and his sister, Amy Gonzalez, of interstate stalking and cyberstalking, in violation of federal law.  The jury also found all three defendants criminally responsible for the death of Christine Belford, who was murdered in the lobby of the New Castle County Courthouse by co-conspirator Thomas Matusiewicz on February 11, 2013.

The defendants, who will be sentenced by United States District Judge Gerald Austin McHugh on October 15, 2015, face a maximum sentence of life in prison.  Following the completion of any prison term, the defendants face a maximum of three years of supervised release. 

The jury’s verdict follows the August 2013 indictment charging David T. Matusiewicz, Lenore Matusiewicz, and Amy Gonzalez with one count of conspiring to commit interstate stalking and cyberstalking, in violation of Title 18, United States Code, Sections 371 and 2261A(1)-(2); two counts of interstate stalking, in violation of Title 18, United States Code, Section 2261A(1); and one count of cyberstalking, in violation of Title 18, United States Code, Section 2261A(2).  This appears to be the first federal conviction of any defendant for cyberstalking resulting in death, in violation of the Violence Against Women Act.

According to the indictment and court documents filed in this case and in prior cases, David T. Matusiewicz and Christine Belford were engaged in divorce and child custody proceedings in the Family Court of Delaware in 2007.  In August 2007, David T. Matusiewicz and his mother, Lenore Matusiewicz, kidnapped the three young children born of his marriage to Christine Belford and fled to South America.  In March 2009, David and Lenore Matusiewicz and the young children were found living in a motor home in Nicaragua.  David and Lenore Matusiewicz were arrested and prosecuted in Delaware, and the children were returned to the care of their mother, Christine Belford. 

In September 2009, David and Lenore Matusiewicz both pled guilty to crimes relating to their kidnapping of the children.  In December 2009, David T. Matusiewicz was sentenced to 48 months in prison to be followed by 5 years of supervision by the United States Probation Office. 

In the days following his December 2009 sentencing, David T. Matusiewicz and Lenore Matusiewicz began to orchestrate, from their prison cells, a course of conduct designed to stalk, harass, and intimidate Christine Belford and her children.  They enlisted Thomas Matusiewicz, Amy Gonzalez and various other persons in this effort, which stretched from December 2009 to February 2013. 

The Matusiewicz family began their stalking campaign by broadly disseminating -- by mail, email, websites, Internet postings, and other means -- false allegations that Christine Belford had, among other things, abused her children, suffered from mental illness and attempted to harm Lenore Matusiewicz.  They used a website, posted YouTube videos, and sent letters to Christine Belford’s church, her children’s schools, the family’s neighbors, friends and relatives repeating their false and defamatory allegations.  Christine Belford and her children were placed in fear and suffered substantial emotional distress as a result of the Matusiewicz family’s widespread, public dissemination of this false and defamatory information. 

In August 2011, the Family Court of the State of Delaware terminated David T. Matusiewicz’s parental rights as to his children with Christine Belford following a multi-day trial.  In doing so, the Family Court rejected David T. Matusiewicz’s assertion that Christine Belford was abusing the children, referring to those allegations as “baseless” and “made up.”  Following the completion of the Family Court termination of parental rights trial, the Matusiewicz family recruited and used a variety of people to conduct physical and online surveillance of Christine Belford and her children. 

After his release from federal custody, David T. Matusiewicz resided in southern Texas, first with Amy Gonzalez and then with Lenore and Thomas Matusiewicz.  Between September and November 2012, the United States Probation Office twice denied David T. Matusiewicz’s requests for permission to travel from Texas to New Jersey.  On November 9, 2012, David T. Matusiewicz filed a petition to reduce the monthly child support arrearage payments he owed Christine Belford in the Family Court of the State of Delaware.  That petition ultimately resulted in the scheduling of the February 11, 2013 court hearing.  Christine Belford was ordered to attend that hearing in the New Castle County Courthouse. 

On January 8, 2013, David T. Matusiewicz sought and received permission from the United States Probation Office in Texas to travel to Delaware to attend the child support arrearage hearing scheduled for February 11, 2013.  David T. Matusiewicz never informed the probation officer that he intended to travel to Delaware with Thomas and Lenore Matusiewicz. 

Between February 4 and 7, 2013, David, Lenore and Thomas Matusiewicz traveled from Texas to the Delaware Valley in two vehicles – a Honda Civic and Honda CRV – later found to contain numerous weapons, ammunition, restraints, an electric shock device, several gas cans, a shovel, and numerous pictures of Christine Belford’s children and residence.

On the morning of February 11, 2013, David and Thomas Matusiewicz drove to a parking garage near the New Castle County Courthouse in the Honda CRV, which contained ammunition, a military style knife, three sets of restraints of progressively smaller sizes, a bullet proof vest, an electric shock device, binoculars, and photographs of Christine Belford’s children and residence.  After entering the courthouse lobby at approximately 7:30 a.m., David T. Matusiewicz entered and stayed in the security screening line, while Thomas Matusiewicz moved around the lobby, occasionally approaching and talking to David T. Matusiewicz. 

Shortly before 8:00 a.m., David T. Matusiewicz passed through courthouse security screening and walked to another floor of the building.  Thomas Matusiewicz remained in the lobby, where he shot Christine Belford multiple times as she entered the courthouse lobby, killing her.  He then shot Laura Mulford multiple times as she attempted to flee.  After a shootout during which he shot and injured two Capitol Police officers, Thomas Matusiewicz died on the sidewalk of the courthouse of a self-inflicted gunshot wound. 

On February 15, 2013, Amy Gonzalez filed a petition for custody of Christine Belford’s three children in the New Castle County Courthouse, which houses the Family Court of the State of Delaware.  The check written to pay the filing fee to the Family Court was dated February 12, 2013 – the day after the Courthouse murders. 

This case was investigated by the Federal Bureau of Investigation and the Delaware State Police, and is being prosecuted by Assistant United States Attorneys Jamie M. McCall, Edward J. McAndrew, and Shawn A. Weede. 

WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Dawan Nelson, age 33, of Houston, Delaware, was sentenced today by United States District Court Judge Sue L. Robinson to 88 months incarceration.   Nelson had pled guilty to possessing 33 kilograms of cocaine with intent to distribute, being a felon in possession of a firearm, and dog fighting. 

According to statements made at the sentencing hearing and documents filed in court, Delaware State Police and Delaware Animal Care and Control officers searched Nelson’s home in Houston, Delaware, on January 8, 2013, and found 33 kilograms of cocaine, two loaded semi-automatic pistols, and 67 American Terrier Pit Bulls.  Many of the pit bulls bore scars from dog fighting.  During the search, officers also found disposable skin staplers, a gallon bottle of iodine, weighted collars, weighted sleds, breaking sticks and spring poles.  The investigation showed that dogs that lost matches sometimes were disposed of by being shot or suffocated.

Following the sentencing, Charles M. Oberly, III, United States Attorney for the District of Delaware, stated, “Depravity associated with dog-fighting, including the torture and execution of dogs, deserves punishment associated with such cruelty.”

This successful prosecution at the federal level sends a message that dog fighting is illegal and will not be tolerated in Delaware,” said Capt. Sherri Warburton, Delaware Animal Care and Control. 

This case was investigated by the Delaware State Police, the Drug Enforcement Administration, Delaware Animal Care and Control, and the U.S. Department of Agriculture.  The case was prosecuted by Assistant United States Attorney Edmond Falgowski.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that James Ekeke, age 26, of Smyrna, Georgia, was sentenced yesterday by the Honorable Leonard P. Stark, United States District Judge for the District of Delaware, to 54 months imprisonment and full restitution.  The defendant pleaded guilty to violations of 18 U.S.C. § 286 (False Claims Conspiracy) and 18 U.S.C. § 1029(a)(3) (Access Device Fraud), in February 2015.  The defendant is a citizen of Nigeria, and he faces deportation at the conclusion of his term of imprisonment.

According to court filings and statements at the sentencing hearing, the defendant and his co-conspirators attempted to obtain more than $4,000,000 in taxpayer funds from the United States Department of Treasury, through the filing of false tax returns.  The defendant was personally responsible for purchasing and supplying more than 600 stolen identities to others, he personally filed many fraudulent tax returns, and he received a significant portion of the proceeds. 

The Department of Treasury lost more than $1.2 million in taxpayer funds, and the hundreds of individuals whose identities were used suffered the compromise of their personal information.  Judge Stark remarked, “The losses to the identity theft victims are hard to quantify.”

The defendant began participating in fraudulent conduct within months of entering the United States, and he continued to participate in tax fraud after one of his co-conspirators was arrested. After the arrest of separately charged and convicted co-conspirator, Festus Frimpong, the defendant changed his telephone number and his internet router, before filing additional false tax returns in 2014.

Also today, co-conspirator Victor Kwabenda Adofo Asante, a.k.a.Victor Asante, age 25, formerly of Newark, Delaware, pled guilty to violations of 18 USC § 286 (False Claims Conspiracy), and 18 USC § 1349 (Bank Fraud Conspiracy).  He will be sentenced on October 1, 2015, before Honorable Leonard P. Stark.  Asante faces a maximum sentence of thirty years in prison, a fine of $250,000, and 5 years of supervised release.

U.S. Attorney Oberly gave the following comments:  “It is gratifying to see the United States District Court, Judge Stark, hand down a sentence of more than four years of incarceration for Mr. Ekeke.  Defendants like Mr. Ekeke deserve such sentences and subsequent deportation when applicable. The American public, the ultimate victims in schemes like this need to know that defendants who engage in activities such as this will be prosecuted as felons and incarcerated.  This District is committed to vigorously prosecuting defendants like Mr. Ekeke and Mr. Asante.”

“Defendants Ekeke and Asante demonstrated a blatant disregard of the integrity of the United States tax system and caused immeasurable hardship to innocent victims. IRS Criminal Investigation remains committed to the pursuit of identity theft and, together with our partners at the U.S. Attorney’s Office, we will hold those who engage in similar conduct accountable”, said Akeia Conner, IRS Criminal Investigation Special Agent in Charge, Philadelphia Field Office.

These cases are the result of an ongoing investigation conducted by the Internal Revenue Service Criminal Investigation, the United States Postal Inspection Service, and the Social Security Administration Office of the Inspector General.  The cases are being prosecuted by Assistant United States Attorney Lauren Paxton.

WILMINGTON, Del. – Medco Health Solutions Inc., a wholly-owned subsidiary of the pharmacy benefit manager Express Scripts Holding Company, of Missouri, has agreed to pay the government $7.9 million to settle allegations that it engaged in a kickback scheme in violation of the False Claims Act, the Justice Department announced today.  Medco provides pharmacy benefit management services to clients who receive subsidies under the Medicare Retiree Drug Subsidy program.

“We will continue to pursue pharmacy benefit managers that enter into kickback arrangements with pharmaceutical manufacturers,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “Hidden financial agreements between drug manufacturers and pharmacy benefit managers can improperly influence which drugs are available to patients and the price paid for drugs.”

The settlement resolves allegations that Medco solicited remuneration from AstraZeneca, a pharmaceutical manufacturer, in exchange for identifying Nexium as the “sole and exclusive” proton pump inhibitor on certain of Medco’s prescription drug lists known as formularies.  The United States alleged that Medco received some or all of the remuneration from AstraZeneca in the form of reduced prices on the following AstraZeneca drugs: Prilosec, Toprol XL and Plendil.  The United States contended that this kickback arrangement between Medco and AstraZeneca violated the Federal Anti-Kickback statute, and thereby caused the submission of false or fraudulent claims for Nexium to the Retiree Drug Subsidy Program.  In January 2015, the United States and AstraZeneca reached a $7.9 million settlement to resolve kickback allegations arising out of the same conduct.

“By this agreement we are making important strides in holding pharmacy benefit managers accountable not only in Delaware but nationwide,” said U.S. Attorney Charles M. Oberly III of the District of Delaware.  “I am proud of the tireless work by this office to investigate this case.”

“Pharmacy benefit managers that seek or accept kickbacks will be held accountable for their improper conduct,” said Special Agent in Charge Nick DiGiulio of the U.S. Department of Health and Human Services-Office of Inspector General (HHS-OIG).  “We will continue to crack down on kickback arrangements, which can undermine drug choices for patients and corrode the public’s trust in the health care system.”

This civil settlement resolves a lawsuit filed under the qui tam, or whistleblower, provision of the False Claims Act, which allows private citizens with knowledge of false claims to bring civil actions on behalf of the government and to share in any recovery.  The lawsuit was filed by former AstraZeneca employees Paul DiMattia and F. Folger Tuggle, whose share of the settlement has not been determined.

The settlement with Medco was the result of a coordinated effort among the Civil Division, the U.S. Attorney's Office for the District of Delaware, the HHS-OIG, the U.S. Postal Service's Office of Inspector General and the FBI Wilmington, Delaware, Resident Agency Office and the FBI's Major Provider Response Team.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.

The False Claims Act lawsuit was filed in the U.S. District Court for the District of Delaware and is captioned United States ex rel. DiMattia et al. v. Medco Health Solutions, Inc.,No. 13-1285 (D. Del.).  The claims settled by this agreement are allegations only; there has been no determination of liability.

WILMINGTON, Del. – William North, the former Chief Credit Officer and Kevyn Rakowski, the former Controller, of Wilmington Trust, were indicted today for their respective roles in making false statements to agencies of the United States government.  The charges include one count of making false statements to the Securities and Exchange Commission (SEC), and three counts of making false statements to Federal Reserve.  The charges stem from North’s and Rakowski’s involvement in concealing from the market and the Federal Reserve the total quantity of past due loans on the bank’s books during October and November 2009.

Wilmington Trust was required to report in its quarterly filings with both the SEC and the Federal Reserve the quantity of its loans for which payment was past due for 90 days or more.  Investors and banking regulators consider the 90-day number in evaluating the health of a bank’s loan portfolio.  According to the Indictment, North, age 55, of Bryn Mawr, Pennsylvania, and Rakowski, age 61, of Lakewood Ranch, Florida, helped conceal the truth about the quality of Wilmington Trust’s loan portfolio from the investing public and from the bank’s regulators. 

Notwithstanding these reporting requirements and the value of this metric to investors and regulators, North and Rakowski participated in Wilmington Trust’s failure to include in its reporting a material quantity of past due loans.  North, as the bank’s Chief Credit Officer, approved the exclusion or “waiver” of such loans from internal reports that he knew would be used to generate the bank’s external financial reports.  Rakowski, as Controller, approved the bank’s filings with the SEC and the Federal Reserve knowing that those reports did not include past due loans that had been “waived.”

In November 2010, Wilmington Trust was acquired by another bank at a discount of approximately 46% from the bank’s share price the prior trading day.

In announcing the Indictment, United States Attorney for the District of Delaware Charles M. Oberly, III, stated, “This Indictment represents another significant step forward in holding accountable those individuals whose criminal conduct contributed to the decline of Wilmington Trust.  As the Chief Credit Officer and Controller of Wilmington Trust, North and Rakowski knew that the false information being provided to the Bank’s regulators and shareholders masked the true condition of its loan portfolio.  Their respective roles in compiling and providing this false information to regulators during the Fall of 2009 are addressed in the Indictment returned today by the Grand Jury.”

“We are committed to holding accountable wrongdoers whose fraudulent actions impact the safety and soundness of financial institutions regulated by the Federal Reserve Board,” said Mark Bialek, Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau.

“Bankers across our nation faced rising past due loans during the financial crisis, but not all made a choice to hide the bad loans from shareholders and regulators like these two former Wilmington Trust officers are alleged to have done,” said Christy Romero, Special Inspector General for TARP (SIGTARP).  We commend United States Attorney Charles Oberly and our law enforcement partners for standing firm with SIGTARP to combat TARP-related crime.”

“Today’s indictment of William North and Kevyn Rakowski sends a strong message that individuals who engage in this type of financial fraud will not go undetected” said Akeia Conner, Special Agent In Charge, IRS Criminal Investigation. "The IRS is proud to share its financial investigative expertise in this and other increasingly sophisticated financial investigations. We will continue to work with our law enforcement partners to bring this investigation to a thorough and complete conclusion."

The case is being investigated by the Federal Bureau of Investigation, the Department of Treasury’s Special Inspector General for the Troubled Asset Relief Program, the Internal Revenue Service’s Criminal Investigative Division, and the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau.  The Securities and Exchange Commission has also contributed to the investigation.  The case is being prosecuted by Assistant U.S. Attorneys Robert Kravetz and Lesley Wolf of the District of Delaware.

WILMINGTON, Del. – Eric R. Aldrich, age 24, of Milford, Delaware, pled guilty today to Receipt of Child Pornography, in violation of federal law.  Charles M. Oberly, III, United States Attorney for the District of Delaware, announced the guilty plea following a hearing in the United States District Court for the District of Delaware.

Aldrich was previously convicted in Delaware of Dealing in Child Pornography in October 2011.  He was sentenced to 15 years in prison, suspended after service of 2 years.  Prior to this incident, he was last released from custody and placed on probation in May 2014. 

As a result of his prior convictions, Aldrich faces enhanced sentencing penalties under federal law, including a mandatory minimum sentence of fifteen years, and a maximum sentence of forty years, in prison.  Aldrich also faces a term of supervised release of five years to life following his prison sentence, and he will be required to continue to register as a sex offender in any U.S. jurisdiction in which he lives, works, or attends school.  Aldrich will be sentenced on August 7, 2015 by Chief United States District Judge Leonard P. Stark.

According to statements made and documents filed in court, Aldrich came to the attention of the Delaware Child Predator Task Force (the “Task Force”) in June 2014, about one month after his release from custody.  That investigation began after the Task Force received cybertips from the National Center for Missing and Exploited Children (NCMEC).  The cybertips reported that a YouTube user, subsequently identified as Aldrich, had uploaded files containing child pornography to YouTube.  

On June 18, 2014, Task Force officers executed a state search warrant at Aldrich’s Milford residence, where they found computer equipment containing over 5,000 still images and 200 videos depicting child pornography.  A significant portion of the child pornography featured mostly prepubescent and adolescent girls being sexually abused by adult males, and webcam images of young teen girls engaged in sexual conduct.  During an interview with law enforcement agents, Aldrich admitted that, since his release from prison, he had been accessing the Internet via a laptop and downloading files containing child pornography. 

WILMINGTON, Del. – Keba Williams, 39, of Wilmington, Del. was sentenced today to seven (7) years of imprisonment for possession with intent to distribute cocaine base (“crack cocaine”) in Wilmington, Del., announced Charles M. Oberly, III, United States Attorney for the District of Delaware.  Williams was also sentenced to three (3) years of supervised release following his prison sentence.

According to the indictment and other documents filed in court, Williams was arrested on June 11, 2014 with 1157 grams of crack cocaine, valued at somewhere between $115,700 and $173,550, which represents the largest seizure of crack cocaine in Delaware in many years.  Inside Williams’ Trolley Square residence, detectives also found materials used to cook crack cocaine, drug packaging paraphernalia, and over $6,500 in cash.  Williams admitted that he had been selling drugs for the past eight (8) years.

United States District Court Chief Judge Leonard P. Stark, who imposed the sentence, called Williams’ conduct “extremely serious and dangerous” and said that “to contribute to the drug trade at such a massive scale warrants a serious punishment.”

The case is the product of an investigation conducted by the Wilmington Resident Office of the Drug Enforcement Administration and the Wilmington Police Department.  Special Assistant United States Attorney Elizabeth L. Van Pelt prosecuted the case on behalf of the United States.

WILMINGTON, Del. – A fourth member of an international computer hacking ring has pleaded guilty to conspiring to break into computer networks of prominent technology companies to steal more than $100 million in intellectual property and other proprietary data. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Charles M. Oberly III of the District of Delaware and Special Agent in Charge Stephen E. Vogt of the FBI’s Baltimore Division made the announcement.

Austin Alcala, 19, of McCordsville, Indiana, pleaded guilty to conspiracy to commit computer intrusions and criminal copyright infringement based on his role in the cyber theft of software and data related to the Xbox One gaming console and Xbox Live online gaming system, and popular games such as the “FIFA” online soccer series; “Call of Duty:  Modern Warfare 3;” and “Gears of War 3.”  A sentencing hearing is set before U.S. District Judge Gregory M. Sleet of the District of Delaware on July 29, 2015.

According to the statement of facts filed in connection with his guilty plea, Alcala was part of the hacking conspiracy between the spring of 2012 and April 2014.  During that period, hacking group members located in the United States and abroad gained unauthorized access to computer networks of various companies, including Microsoft Corporation, Epic Games Inc., Valve Corporation and Zombie Studios.  The conspirators accessed and stole unreleased software, software source code, trade secrets, copyrighted and pre-release works and other confidential and proprietary information.  Members of the conspiracy also stole financial and other sensitive information relating to the companies—but not their customers—and certain employees of such companies. 

Specifically, the data theft targeted software development networks containing source code, technical specifications and related information for Microsoft’s then-unreleased Xbox One gaming console, as well as intellectual property and proprietary data related to Xbox Live and games developed for that online gaming system.

Alcala admitted in court that he was personally involved in hacking into and stealing log-in credentials and intellectual property from victim companies including Microsoft and Zombie Studios.  Alcala further admitted that, on one occasion, he transmitted to co-conspirators a database file containing approximately 11,266 log-in credentials stolen from a victim company. 

The value of the intellectual property and other data stolen by the hacking ring, as well as the costs associated with the victims’ responses to the conduct, is estimated to range between $100 million and $200 million.  To date, the United States has seized over $620,000 in cash and other proceeds related to the charged conduct.

Sanadodeh Nesheiwat, 28, of Washington, New Jersey, and David Pokora, 22, of Mississauga, Ontario, Canada, previously pleaded guilty to the same conspiracy charge on Sept. 30, 2014.  They remain in custody pending their sentencing hearings, which are scheduled for April 2015.  Nathan Leroux, 20, of Bowie, Maryland, pleaded guilty to the same conspiracy charge on Jan. 20, 2015, and remains in custody pending his sentencing hearing scheduled for May 2015.

This case is being investigated by the FBI, with assistance from the Criminal Division’s Office of International Affairs, the U.S. Department of Homeland Security’s Homeland Security Investigations and Customs and Border Protection, the U.S. Postal Inspection Service, the Canada Border Services Agency, the Western Australia Police and the Peel Regional Police of Ontario, Canada.  The case is being prosecuted by Deputy Chief for Litigation James Silver of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Edward J. McAndrew of the District of Delaware.  

WILMINGTON, Del. – Rogelio “Roger” Cordero, age 58, of New Castle, Delaware, pled guilty today to Receipt of Child Pornography, in violation of federal law.  Charles M. Oberly, III, United States Attorney for the District of Delaware, announced the guilty plea following a hearing in the United States District Court for the District of Delaware.

Cordero was previously convicted in Delaware of Unlawful Sexual Intercourse, Unlawful Sexual Penetration and Unlawful Sexual Contact Second Degree in 1992.  Those crimes involved Cordero’s sexual abuse of two female minors over an 18-month period.  He was sentenced to 18 years in Delaware state prison, and 5 years of probation following his release. 

As a result of his prior convictions, Cordero faces enhanced sentencing penalties under federal law, including a mandatory minimum sentence of fifteen years, and a maximum sentence of forty years, in prison.  Cordero also faces a term of supervised release of five years to life following his prison sentence, and he will be required to register as a sex offender in any U.S. jurisdiction in which he lives, works, or attends school.  Cordero will be sentenced on ­July 27, 2015 by United States District Judge Sue L. Robinson.

According to statements made and documents filed in court, Cordero came to the attention of the Delaware Child Predator Task Force (the “Task Force”) after it began an investigation into two other registered child sex offenders living in Delaware.  That investigation began in October 2012, after the Task Force received a cybertip from the National Center for Missing and Exploited Children (NCMEC).  The cybertip reported that an AOL user, subsequently identified as Cordero, a registered child sex offender from New Castle, Delaware, had uploaded files containing child pornography through an AOL server. 

On December 20, 2012, Task Force officers executed a state search warrant at Roger Cordero’s New Castle residence, where they found computers containing thousands of images of child pornography featuring mostly prepubescent and adolescent children.  They also found that Cordero had been trading child pornography with David Pennington, another registered child sex offender whom Cordero had met while both were incarcerated in the Smyrna Correctional Institution for child sex offenses.  The men shared the images of child pornography by mailing digital photographs saved to thumb drives back and forth to one another.  They also found a small, concealable “pen” camera that Cordero had used to attempt to record explicit footage of a minor child changing clothes. 

Later on the day of December 20, 2012, Task Force officers executed a state search warrant at Pennington’s Georgetown residence.  Pennington, who was then wearing an electronic monitoring device due to a state probation violation, was present for the search.  During the search, Task Force members recovered evidence relating to the mailing of USB “thumb drives” containing child pornography and handwritten child sexual abuse stories between Pennington and Cordero.  Pennington also informed the officers that he would view child pornography mailed to him by Cordero with another registered sex offender, William Zimmerman, of Georgetown, Delaware.

On January 8, 2013, Task Force officers executed a state search warrant at Zimmerman’s Georgetown residence.  They recovered several pieces of computer equipment found to contain hundreds of images of child pornography.  The images featured children ranging in age from infancy to mid-teen being posed or engaged in sexual acts with adult males. 

Cordero is now the third member of the group to be convicted of child exploitation crimes.  On October 11, 2013, David Pennington was sentenced to 28 years in prison by Delaware Superior Court Judge T. Henley Graves after pleading guilty to Dealing in Child Pornography, in violation of Delaware law.  On April 22, 2014, William Zimmerman was sentenced to the mandatory minimum term of 15 years in federal prison by United States District Judge Gregory M. Sleet after pleading guilty to Receipt of Child Pornography. 

All three cases were brought as part of the United States Department of Justice’s Project Safe Childhood Program, which was launched in May 2006 to combat the growing epidemic of online child sexual exploitation and abuse.  Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue child victims. 

As intended by the United States Department of Justice’s Project Safe Childhood Program, the Delaware Child Predator Task Force, the United States Department of Homeland Security, Homeland Security Investigations, the Delaware Attorney General’s Office and the U.S. Attorney’s Office worked together to investigate and prosecute Cordero, Pennington and Zimmerman.  Based on their outstanding efforts, the investigative and prosecution team recently received the United States Department of Homeland Security’s “Exemplary Partnership Award,” the only award of its kind presented nationally by DHS this year. 

WILMINGTON, Del. – Ingrid Gonzalez-Rodriguez, 28, of Philadelphia, Pa., Joseph Collazo, 25, of Wilmington, Del., and Stefano Saienni, 23, of Elkton, Md., were indicted by a federal grand jury today on charges relating to the trafficking of a significant amount of heroin into the Wilmington, Del. area, announced Charles M. Oberly, III, United States Attorney for the District of Delaware. 

According to court documents filed in support of the indictment, Gonzalez-Rodriguez, Collazo, and Saienni conspired to distribute heroin in Delaware.  The case is the result of a four-month investigation by the Drug Enforcement Administration (“DEA”), which culminated in January 2015 when Gonzalez-Rodriguez was caught delivering two packages of heroin from Philadelphia to Wilmington.  Approximately 5,720 bags of heroin were seized from Gonzalez-Rodriguez, some of which were packaged inside baby diapers.  The heroin is valued at nearly $30,000. 

If convicted, the defendants face charges that carry a maximum penalty of 40 years imprisonment (with a mandatory minimum of five years), up to a lifetime of supervised release (with a mandatory minimum of four years), a fine of up to $5,000,000 and a $100 special assessment.  In addition, Saienni faces a charge for possession of a firearm in furtherance of a drug trafficking crime, which carries an additional mandatory minimum term of five years imprisonment.  The case is the result of an investigation conducted by the Wilmington Tactical Diversion Squad of the DEA.  Assistant United States Attorney Shawn A. Weede and Special Assistant United States Attorney Elizabeth L. Van Pelt are prosecuting the case on behalf of the United States.

Indictments are only charges and are not evidence of guilt.  A defendant is presumed to be innocent until and unless proven guilty.

WILMINGTON, Del. – Aaron Cephas, 33, of Wilmington, Del., Dashawn Broomer, 20, of Claymont, Del., and Andre Green, 20, of Claymont, Del., pled guilty yesterday to conspiring to distribute heroin in Wilmington, Del., announced Charles M. Oberly, III, United States Attorney for the District of Delaware. 

This case is the result of a year-long Federal Bureau of Investigation (“FBI”) investigation into these men, who ran a heroin trafficking organization based in Wilmington.  The investigation culminated in a one-and-a-half-month long wiretap investigation involving the interception of three telephones – one used by Cephas, one used by Broomer, and one used by Green.

Co-conspirator Joshua Cirwithian, 28, of Wilmington, Del., previously pled guilty to the same conspiracy charge on December 22, 2014.  All defendants remain in custody pending their sentencing hearings.  Cirwithian’s sentencing hearing is scheduled for April 23, 2015.  Cephas’, Broomer’s, and Green’s sentencing hearings are scheduled for June 10, 2015.

According to the indictment and other court records filed in support of today’s guilty pleas, Cephas, Broomer, and Green were arrested on June 27, 2014.  At that time, pursuant to a federal warrant, Broomer’s residence in Claymont, Del. was searched.  Detectives found over 900 bags of heroin, a loaded handgun, and over $28,500 in cash.  Cirwithian has been incarcerated since February 24, 2014, when he was arrested in a car in Virginia with a loaded handgun and approximately $65,000 in cash.

Cephas and Broomer face a maximum penalty of 40 years imprisonment (with a mandatory minimum of five years), up to a lifetime of supervised release (with a mandatory minimum of 4 years), a fine of up to $5,000,000, and a $100 special assessment.  Green and Cirwithian face a maximum penalty of 20 years imprisonment, up to a lifetime of supervised release (with a mandatory minimum of 3 years), a fine of up to $1,000,000, and a $100 special assessment. 

The case is the product of an investigation conducted by the Federal Bureau of Investigation (“FBI”) Violent Crime Task Force, which is part of the New Castle County HIDTA, a recently established collaborative effort among federal, state, and local law enforcement agencies.  The FBI Violent Crime Task Force includes members from the following agencies: FBI, Delaware State Police, New Castle County Police Department, Delaware State Probation and Parole, and the Delaware Attorney General’s Office.  In addition, the Wilmington Police Department assisted on this case. Assistant United States Attorney Shawn A. Weede and Special Assistant United States Attorney Elizabeth L. Van Pelt are prosecuting the case on behalf of the United States.

WILMINGTON, Del. – Edwin Hernandez, 46, of Wilmington, Del., and Hector Hernandez, 36, of New Castle, Del., were indicted by a federal grand jury today on charges relating to the distribution of a half-kilogram of cocaine in Wilmington, Del., announced Charles M. Oberly, III, United States Attorney for the District of Delaware. 

Edwin Hernandez has worked at the Wilmington Housing Authority as Maintenance Superintendent for over twenty years.  According to the criminal complaint filed in the case, on February 5, 2015, Edwin Hernandez was arrested in a Wilmington Housing Authority van in the CVS Pharmacy parking lot at 1005 Delaware Avenue in Wilmington, Delaware.  At the time of his arrest, he was found to be in possession of more than 500 grams of cocaine, which is valued at over $50,000.

Also charged was Edwin Hernandez’s brother, Hector Hernandez, who was arrested at the same time, in possession of a loaded firearm, near the CVS Pharmacy parking lot.

The defendants face two charges that each carry a maximum penalty of 40 years imprisonment (with a mandatory minimum of five years), up to a lifetime of supervised release (with a mandatory minimum of 4 years), a fine of up to $5,000,000 and a $100 special assessment, if convicted.  In addition, Hector Hernandez faces a third charge, for possession of a firearm in furtherance of a drug trafficking crime, which carries an additional mandatory minimum term of 5 years imprisonment.

The case is the product of an investigation conducted by the Drug Enforcement Administration (“DEA”) Drug Trafficking Task Force, which is part of the New Castle County HIDTA, a recently established collaborative effort among federal, state, and local law enforcement agencies.  The DEA Drug Trafficking Task Force includes members from the following agencies: DEA, Delaware State Police, New Castle County Police Department, Newark Police Department, Department of Homeland Security – Homeland  Security Investigations, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Delaware Probation and Parole, and the Delaware Attorney General’s Office.  Assistant United States Attorney Shawn A. Weede and Special Assistant United States Attorney Elizabeth L. Van Pelt are prosecuting the case on behalf of the United States.

Indictments are only charges and are not evidence of guilt.  A defendant is presumed to be innocent until and unless proven guilty.

WILMINGTON, Del. – AstraZeneca LP, a pharmaceutical manufacturer based in Delaware, has agreed to pay the government $7.9 million to settle allegations that it engaged in a kickback scheme in violation of the False Claims Act, the Justice Department announced today.  AstraZeneca markets and sells pharmaceutical products in the United States, including a drug sold under the trade name Nexium.

“We will continue to pursue pharmaceutical companies that pay kickbacks to pharmacy benefit managers,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division.  “Hidden financial agreements between drug manufacturers and pharmacy benefit managers can improperly influence which drugs are available to patients and the price paid for drugs.”

The settlement resolves allegations that AstraZeneca agreed to provide remuneration to Medco Health Solutions, a pharmacy benefit manager, in exchange for Medco maintaining Nexium’s “sole and exclusive” status on certain Medco formularies and through other marketing activities related to those Medco formularies.  The United States alleged that AstraZeneca provided some or all of the remuneration to Medco through price concessions on drugs other than Nexium, namely on Prilosec, Toprol XL and Plendil.  The United States contended that this kickback arrangement between AstraZeneca and Medco violated the Federal Anti-Kickback statute, and thereby caused the submission of false or fraudulent claims for Nexium to the Retiree Drug Subsidy Program.

“By this agreement we are making important strides in holding drug manufacturers accountable not only in Delaware but nationwide,” said U.S. Attorney Charles M. Oberly III of the District of Delaware.  “I am proud of the tireless work by this office to investigate this case.”

This civil settlement resolves a lawsuit filed under the qui tam, or whistleblower, provision of the False Claims Act, which allows private citizens with knowledge of false claims to bring civil actions on behalf of the government and to share in any recovery.  The lawsuit was filed by former AstraZeneca employees Paul DiMattia and F. Folger Tuggle, who will collectively receive $1,422,000. 

The settlement with AstraZeneca was the result of a coordinated effort among the Civil Division, the U.S. Attorney’s Office for the District of Delaware and the U.S. Department of Health and Human Services’ Office of Inspector General. 

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $23.5 billion through False Claims Act cases, with more than $15 billion of that amount recovered in cases involving fraud against federal health care programs.

The False Claims Act lawsuit was filed in the U.S. District Court for the District of Delaware and is captioned United States ex rel. DiMattia et al. v. AstraZeneca LP et al. No. 10-910 (D. Del.).  The claims settled by this agreement are allegations only; there has been no determination of liability.

WILMINGTON, Del. – Harry K. Roche, age 44, of Millsboro, Delaware, was sentenced yesterday to 35 years in prison for Production and Transportation of Child Pornography, in violation of federal law.  Roche also was sentenced to a lifetime of supervised release following his prison sentence.  He also will continue to be required to continue to register as a sex offender in any jurisdiction in which he lives, works, or attends school. 

Roche was previously convicted in Delaware of Dealing in Child Pornography and Possession of Child Pornography in 2003, which involved Roche producing sexually explicit images of children in his Magnolia, Delaware apartment.  In 1994, Roche had been convicted of sexual harassment of a minor boy.  At the time of the instant offense, Roche was registered as a sex offender as required by Delaware and federal law. 

 According to statements made and documents filed in court, Roche came to the attention of the Delaware Child Predator Task Force after it received a cybertip from the National Center for Missing and Exploited Children (NCMEC).  The cybertip reported that an AOL user, subsequently identified as Roche, had distributed files containing child pornography through an AOL server.         

On January 31, 2013, Delaware Child Predator Task Force officers executed a search warrant at Roche’s apartment, which was located above the Bluewater Grill restaurant, in Millsboro, Delaware.  Roche and a roommate were present for the search, during which officers seized numerous computers, cellular phones and external digital storage devices.  A subsequent forensic examination of that computer equipment revealed that Roche had collected and distributed hundreds of pictures and movies of child pornography, virtually all of which featured prepubescent boys engaged in sexual acts.  In a number of these images and movies, the child victims were bound, gagged or blindfolded as they were violently raped by adult males.

Also during the forensic examination of Roche’s iPhone, a forensic examiner discovered a series of photographs of Roche in the bedroom of his residence engaged in a sexual act with a young boy.  The Delaware Child Predator Task Force and the United States Department of Homeland Security, Homeland Security Investigations, worked together to identify the child victim, who resided in Delaware at the time.  Roche subsequently distributed the images that he had produced, along with other images of child pornography, to other child sex offenders. 

Following the sentencing hearing, United States Attorney Charles M. Oberly, III stated:  “Harry Roche is every child’s bogeyman and every parent’s worst nightmare.  Stealing a child’s innocence, along with the physical and emotional damage associated therewith, is deserving of a severe sentence, as mandated by law.  Harry Roche, hopefully, will never hurt another child as a result of today’s sentence.  To those who are engaging in similar behavior, we are coming after you.”

 “The safety of our children is of vital importance, and we do everything within our power to protect it,” said Abigail Layton, Commander of the Child Predator Task Force of the Delaware Department of Justice. “The link between those who possess child pornography and those who commit physical offenses against children is too strong to take lightly, and the Child Predator Task Force is proud to work with federal law enforcement officials to find these dangerous predators.”

“This criminal will be away from society for decades thanks to the collaborative efforts of HSI and local law enforcement,” said John Kelleghan, HSI Philadelphia special agent in charge. “Child predators can be assured we are focused and determined to flush them out and seek justice for the victims of their heinous crimes.”

This case is being investigated by the Delaware Child Predator Task Force and the United States Department of Homeland Security, Homeland Security Investigations.  It is being prosecuted by Assistant United States Attorney Edward J. McAndrew.

WILMINGTON, Del. – A third member of an international computer hacking ring has pled guilty to conspiring to break into computer networks of prominent technology companies and to steal more than $100 million in intellectual property and other proprietary data. 

Nathan Leroux, 20, of Bowie, Maryland, pled guilty to conspiracy to commit computer intrusions and criminal copyright infringement based on his role in the cyber theft of software and data related to the Xbox One gaming console and Xbox Live online gaming system, and popular games such as the “FIFA” online soccer series; “Call of Duty:  Modern Warfare 3;” and “Gears of War 3.”  Leroux has been in custody since attempting to flee into Canada from Buffalo, New York, on June 16, 2014.

U.S. Attorney Charles M. Oberly III of the District of Delaware, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, and Special Agent in Charge Stephen E. Vogt of the FBI’s Baltimore Field Office made the announcement.

“As the indictment charges, the members of this international hacking ring stole trade secret data used in high-tech American products, ranging from software that trains U.S. soldiers to fly Apache helicopters to Xbox games that entertain millions around the world,” said Assistant Attorney General Caldwell.  “The American economy is driven by innovation.  But American innovation is only valuable when it can be protected.  Today’s guilty pleas show that we will protect America’s intellectual property from hackers, whether they hack from here or from abroad.”

“With this plea, we see not just rampant hacking and data theft, but the subsequent exploitation of stolen intellectual property to generate illicit funds online,” said U.S. Attorney Oberly. 

“This group hacked into the computer systems of multiple companies, took their property and tried to make money capitalizing on someone else’s hard work and effort.  When you put it in very simple terms, it’s theft and against the law.  There are consequences to breaking the law in the U.S., whether you live here or in another country,” said Stephen Vogt, FBI Special Agent in Charge of the Baltimore Field Office.

Conspirators Sanadodeh Nesheiwat, 28, of Washington, New Jersey, and David Pokora, 22, of Mississauga, Ontario, Canada, previously pled guilty to the same conspiracy charge on September 30, 2014.  They remain in custody pending their sentencing hearings, which are scheduled for April 2015.  Pokora’s plea is believed to be the first conviction of a foreign-based individual for hacking into U.S. businesses to steal trade secret information.  Charges against a fourth defendant, Austin Alcala, 19, of McCordsville, Indiana, remain pending. 

 According to the superseding indictment and other court records filed in support of today’s guilty plea, Leroux was part of the hacking conspiracy between January 2011 and September 2012.  During that period, hacking group members located in the United States and abroad gained unauthorized access to computer networks of various companies, including Microsoft Corporation, Epic Games Inc., Valve Corporation, and Zombie Studios.  The conspirators accessed and stole unreleased software, software source code, trade secrets, copyrighted and pre-release works, and other confidential and proprietary information.  Members of the conspiracy also allegedly stole financial and other sensitive information relating to the companies – but not their customers – and certain employees of such companies.  

  Specifically, the data theft targeted software development networks containing source code, technical specifications and related information for Microsoft’s then-unreleased Xbox One gaming console, as well as intellectual property and proprietary data related to Xbox Live and games developed for that online gaming system.

Leroux admitted in court that he and others used the stolen intellectual property to build, and attempt to sell, counterfeit versions of the Xbox One console before its public release in November 2013.  In July 2013, the FBI intercepted a counterfeit console built by Leroux, which was destined for the Republic of Seychelles. 

Leroux also admitted that he developed a software exploit  that allowed him and others to generate millions of “coins” for the FIFA soccer games playable on the Xbox Live platform.  These coins are the virtual, in-game currency used to build a “FIFA Ultimate Team” in the games.  Without the authorization of Electronic Arts, the intellectual property rights holder to the FIFA games, Leroux and others sold bulk quantities of the “FIFA coins” via online black markets. 

The value of the intellectual property and other data that the defendants stole, as well as the costs associated with the victims’ responses to the conduct, is estimated to range between $100 million and $200 million.  To date, the United States has seized over $620,000 in cash and other proceeds related to the charged conduct.

  This case is being investigated by the FBI, with assistance from the Criminal Division’s Office of International Affairs, the U.S. Department of Homeland Security’s Homeland Security Investigations and Customs and Border Patrol, the U.S. Postal Inspection Service, the Canada Border Services Agency, the Western Australia Police and the Peel Regional Police of Ontario, Canada. 

The case is being prosecuted by Trial Attorney James Silver of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Edward J. McAndrew of the District of Delaware.

See also:  http://www.justice.gov/usao/de/news/2014/09-30.html

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Arthur Robinson, age 39, of Frederick, Maryland, was sentenced yesterday by the Honorable Sue L. Robinson, United States District Judge for the District of Delaware, to 56 months imprisonment and full restitution.  The defendant pleaded guilty to violations of 42 U.S.C. § 408 (social security fraud), and 18 U.S.C. § 1028A (aggravated identity theft), in April 2014.

Over the course of more than a decade, the defendant defrauded multiple federally insured financial institutions, obtaining at least $200,000.  The defendant’s fraud involved making false statements in credit card applications, using the credit cards to make extensive charges, disputing the charges, abandoning significant balances on the cards, and suing the lenders when they commenced collection efforts.  In some instances, the defendant used his real name and social security number on the applications, meanwhile falsifying his wage and employment information to appear more creditworthy.  In other instances, the defendant used aliases, including “Arthur Collier” and “Michael Johnson”, as well as the names and social security numbers of minor children. 

The defendant was able to dispute the charges with lenders, by falsely claiming that he was a victim of identity theft and/or the goods he purchased were not delivered by the merchants.  Some of the lenders agreed to remove the charges from the defendant’s credit card accounts.  Some did not.  When the defendant began receiving collection calls from lenders on the outstanding balances, he responded, once again, with false statements.  The defendant sued the lenders, claiming that he knew nothing about the credit cards, and he sought damages under the Telephone Consumer Protection Act, 47 U.S.C. § 227 (TCPA).

At various points in time, the defendant’s fraudulent activities resulted in negative marks on his credit report.  The defendant responded by contacting at least one of the credit agencies to dispute the negative marks.  The defendant claimed that he was a victim of identity theft.  The defendant’s efforts succeeded in clearing some of the credit history, enabling further fraud.  However, by early 2009, extensive negative credit history had accrued.  The defendant escalated the fraud by attempting to obtain a new social security number from the government. 

The defendant made repeated false representations to the Social Security Administration (SSA), claiming that he was an identity theft victim.  The defendant was determined to obtain a new SSN.  The SSA initially denied the defendant’s application.  Undeterred, the defendant returned to the SSA with falsified letters from banks, purporting to state that the defendant was an identity theft victim.  These letters appeared to be authentic at the time, and the defendant was successful in obtaining a new SSN.  Within months of the issuance of the new SSN, the defendant used it to open new lines of credit and continue the fraud.

At the Sentencing Hearing, the Honorable Sue L. Robinson commented that the defendant was one of the most “relentlessly dishonest” defendants she had encountered in her years as a Judge.

U.S. Attorney Oberly gave the following comments:  “I want to personally thank Barclays Bank for bringing this matter to the attention of my office.  Financial institutions, as well as other corporate entities, are increasingly themselves victims of financial crimes. Individuals who defraud individuals or corporations can expect to be prosecuted when crimes such as those committed by Arthur Robinson are brought to our attention.”

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Tendayi Mandere, a 36 year old citizen of Zimbabwe, was sentenced today by the Honorable Richard G. Andrews, United States District Judge for the District of Delaware, to 64 months imprisonment and full restitution.  The defendant pleaded guilty to violations of 18 USC § 286 (False Claims Conspiracy) and 18 USC § 1028A(a)(1) (Aggravated Identity Theft), in April 2014. 

The defendant participated in a tax fraud conspiracy involving the filing of more than 130 false individual federal income tax returns with the Internal Revenue Service.  The defendant obtained the names and social security numbers of real individuals from his co-conspirators, and he used them to electronically file false tax returns via the Internet.  The defendant fabricated the wage and withholding information on the returns, which sought refunds of more than $600,000.  Most of these fraudulent returns were rejected by the Internal Revenue Service.  The defendant was ordered to pay restitution to the Internal Revenue Service in the amount of $114,000, the amount obtained by the defendant and his co-conspirators during the course of the scheme. 

U.S. Attorney Oberly gave the following comments:  “This case should send a clear signal that individuals who conspire with others to file false claims against the United States Treasury will face significant penalties.  My office is committed to working with the Internal Revenue Service to prosecute these cases, and I will seek incarceration wherever possible and appropriate.”

This sentence exemplifies IRS Special Agents' intense focus on the rigorous pursuit of identity theft and refund fraud," said Richard Goss, Acting Special Agent in Charge, IRS Criminal Investigation. "Mr. Mandere perpetuated an elaborate scheme driven by insatiable greed and a blatant disregard for the tremendous damage inflicted on innocent victims. Be assured that IRS Criminal Investigation, together with our law enforcement partners and the U.S. Attorney's Office, will hold those who engage in similar behavior fully accountable."

This case is the result of an investigation conducted by the Internal Revenue Service Criminal Investigation, the United States Postal Inspection Service, and the Social Security Administration, Office of the Inspector General.  The case is being prosecuted by Assistant United States Attorneys Lauren Paxton.

WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced today that United States District Judge Richard G. Andrews sentenced James A. Ladio, the founder and former CEO of Midcoast Community Bank, Inc. (“Midcoast”), to a term of imprisonment of 24 months.

Ladio, age 58, of Wilmington, Delaware, pleaded guilty on December 17, 2013, to two counts of bank fraud and two counts of money laundering.  The charges related to a nominee loan scheme, in which Ladio recruited two former MidCoast customers to obtain loans, the proceeds of which they loaned back to Ladio. 

According to facts revealed during the sentencing hearing, Ladio had been involved in a decade-long “loan-swap” arrangement with former Wilmington Trust Co. (“WTC”) Market Manager Brian Bailey, in which the two men provided more than twenty (20) loans to each other totaling in excess of $1.5 million.  In June 2010, WTC called Ladio’s loans and required him to enter into a Global Restructuring Agreement (the “Agreement”).  Ladio engaged in the nominee loan scheme in substantial part to make interest and principal payments under the Agreement.

United States Attorney Oberly said, “The Court rightly punished Mr. Ladio for his serious fraud offenses, which negatively impacted his bank and other financial institutions.  Today’s sentence sends a powerful message that bankers who abuse their positions of trust and engage in self-dealing will face significant consequences, including imprisonment and being banned from banking.” 

“Ladio, former president and chief executive officer of MidCoast Community Bank and a leader in the Delaware banking community, was sentenced to spend the next 24 months in federal prison for bank fraud against three banks, including TARP bank Wilmington Trust Corporation said Christy Romero, Special Inspector General for TARP (SIGTARP). “For more than a decade involving more than 20 transactions, Ladio lined his pockets by fraudulently securing Wilmington Trust loans through former Wilmington Trust officer Brian Bailey in exchange for Ladio making sweetheart loans to Bailey. Ladio used the loans to pay off personal debt. SIGTARP and our law enforcement partners will hold accountable perpetrators who engage in fraud related to TARP. We will not rest in our efforts to identify and investigate those individuals, unravel their crimes, and support their prosecution. We are proud to stand together with the United States Attorney’s Office for the District of Delaware in our combined fight against bailout related crime.”  

"In recent years illegal activity involving the banking industry has brought financial ruin to many Americans, as well as to several American banks,” said Richard Goss, IRS Criminal Investigation Acting Special Agent in Charge. “This joint investigative effort continues to demonstrate our resolve to ensure that the financial services industry will not be used for personal financial gain and will be operated in a fair and honest manner to preserve the public interest.” 

The case was investigated by the Federal Bureau of Investigation, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), the Internal Revenue Service Criminal Investigation Division, and the Office of Inspector General, Board of Governors of the Federal Reserve System.  Assistant United States Attorneys Robert F. Kravetz and Lesley F. Wolf prosecuted the case.     

WILMINGTON, Del. – Charles Jobe, 54, of Marcus Hook, Pennsylvania, pleaded guilty today to one count of assault on a federal officer, a misdemeanor in violation of Title 18, United States Code, Section 111(a), announced Charles M. Oberly, III, United States Attorney for the District of Delaware. 

Jobe admitted to pointing an inoperable BB gun at several VA police officers at the Wilmington Veterans Administration Medical Center on June 6, 2014.  The BB gun looked very similar to a handgun.  Jobe did not comply with officers’ commands to drop his weapon, at which point an officer fired two shots at Jobe, one of which grazed his hand.  Jobe was then taken into custody, where he received treatment for a small abrasion to his hand and was involuntarily committed to a psychiatric facility for a week.  After his release from the psychiatric facility, Jobe was transported to the Federal Detention Center in Philadelphia, Pennsylvania, where he has been detained ever since, pending the above federal charge.

In a post-arrest statement, the defendant said that he was depressed, that he wanted to end his life, and that the above conduct was an attempt to commit suicide by having a police officer shoot him to death.

United States Magistrate Judge Sherry R. Fallon scheduled a sentencing hearing for January 15, 2015 at 9:30 a.m. Jobe faces a maximum penalty of 1 year imprisonment, 1 year of supervised release, a fine of $100,000, and a special assessment of $25.

The case was investigated by the Wilmington Field Office of the FBI and the United States Department of Veterans Affairs, Criminal Investigations Division, Office of the Inspector General.  Special Assistant United States Attorney Elizabeth L. Van Pelt is prosecuting the case on behalf of the United States.

WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced today that Peter W. Hayes, age 49 of Newark, DE, pleaded guilty to one count of accepting a gift for procuring loans, in violation of Title 18, United States Code, Section 215.  United States District Judge Richard G. Andrews scheduled a sentencing hearing for March 17, 2015, at 9 a.m.

Hayes, a former Relationship Manager at Wilmington Trust Corp. (“WTC” or the “Bank”), admitted that he purchased two model homes from a large Bank customer (the “customer”) in November 2005 as part of a sale/lease-back arrangement, whereby the customer agreed to pay Hayes and his business partner monthly lease payments in the exact amount of, and to satisfy, their monthly mortgage payments.  In March 2008, Hayes and his partner sold the model homes to a third-party for a loss, leaving Hayes with a $70,000.00 obligation to his mortgage lender.  Hayes ultimately requested a loan from the WTC customer to cover the shortfall.  In November 2008, the customer loaned Hayes the necessary funds by issuing him a check from the customer’s operating account at WTC.  Hayes repaid the loan in February 2009 by depositing a treasury check directly into the customer’s WTC operating account.

During the four year period in which Hayes had a financial relationship with the customer, he approved millions of dollars in financing for various projects being developed by the customer.  As part of his guilty plea, Hayes admitted to making specific funding decisions for the customer that were based on materially false statements and omissions, or were otherwise in contravention of existing loan agreements.

With his guilty plea, Hayes becomes the third former Bank employee to plead guilty to criminal conduct relating to his employment at WTC.          

United States Attorney Oberly said, “It is a serious offense for a bank insider to engage in self-dealing with a client for his own personal benefit.  The successful prosecution of Mr. Hayes demonstrates my Office’s commitment to uncover criminal misconduct committed by bank officers, particularly where such activity has the potential to affect the safety and soundness of a financial institution and its shareholders.”
“Hayes, a former relationship manager at TARP bank Wilmington Trust, is the third employee to plead guilty to charges stemming from the investigation by SIGTARP and our partners of purported criminal conduct at the bank,” said Christy Romero, Special Inspector General for TARP (SIGTARP).  “In today’s plea, Hayes admitted to exchanging favors with a long-time bank customer for his personal benefit.  SIGTARP and our law enforcement partners stand united in our commitment to safeguarding TARP on behalf of taxpayers, and perpetrators of crime related to TARP will be brought to justice.”

WILMINGTON, Del. - United States Attorney Charles M. Oberly, III, announced today that Assistant United States Attorney (AUSA) Patricia C. Hannigan will lead the efforts of her Office in connection with the Justice Department’s nationwide Election Day Program for the upcoming November 4, 2014, general elections. AUSA Hannigan has been appointed to serve as the District Election Officer (DEO) for the District of Delaware, and in that capacity is responsible for overseeing the District’s handling of complaints of election fraud and voting rights abuses in consultation with Justice Department Headquarters in Washington.

United States Attorney Oberly said, “Every citizen must be able to vote without interference or discrimination and to have that vote counted without it being stolen because of fraud. The Department of Justice will act promptly and aggressively to protect the integrity of the election process.”

The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations whenever and wherever they occur. The Department’s long-standing Election Day Program furthers these goals, and also seeks to ensure public confidence in the integrity of the election process by providing local points of contact within the Department for the public to report possible election fraud and voting rights violations while the polls are open on election day.

Federal law protects against such crimes as intimidating or bribing voters, buying and selling votes, impersonating voters, altering vote tallies, stuffing ballot boxes, and marking ballots for voters against their wishes or without their input. It also contains special protections for the rights of voters and provides that they can vote free from acts that intimidate or harass them. For example, actions of persons designed to interrupt or intimidate voters at polling places by questioning or challenging them, or by photographing or videotaping them, under the pretext that these are actions to uncover illegal voting may violate federal voting rights law. Further, federal law protects the right of voters to mark their own ballot or to be assisted by a person of their choice.

The franchise is the cornerstone of American democracy. We all must ensure that those who are entitled to the franchise exercise it if they choose, and that those who seek to corrupt it are brought to justice. In order to respond to complaints of election fraud or voting rights abuses on November 4, 2014, and to ensure that such complaints are directed to the appropriate authorities, United States Attorney Oberly stated that AUSA/DEO Hannigan will be on duty in this District while the polls are open.  She can be reached by the public at the following telephone number (302) 507-1607.

In addition, the FBI will have special agents available in each field office and resident agency throughout the country to receive allegations of election fraud and other election abuses on election day. The local FBI field office can be reached by the public at (302) 658-4391.  Complaints can be made directly to the Civil Rights Division’s Voting Section in Washington by phone at 1-800-253-3931 or (202) 307-2767, by fax at (202) 307-3961, by email to voting.section@usdoj.gov or by complaint form at http://www.justice.gov/crt/complaint/votintake/index.php.

WILMINGTON, Del. – Charles M. Oberly III, United States Attorney for the District of Delaware, announced that an Indictment has been handed down by a federal grand jury charging Shakil Miller (age 21), Jon Henry (age 20), and Corey Harris (age 19), all of Dover, with Conspiracy to Provide False Information to a Federal Firearms Licensee, in violation of Title 18 U.S.C. Section 371, and separately charging Miller with Providing False Information to a Federal Firearms Licensee, in violation of Title 18 U.S.C. Section 922(a)(6) and 924(a)(2).  The defendants face up to 5 years imprisonment and a maximum of $250,000 fine on the Conspiracy count, and Miller faces 10 years imprisonment and a $250,000 fine on the Providing False Information count.

The Indictment alleges that Miller traveled with Henry and Harris to Milford Trade and Exchange to purchase a firearm for others.  After Harris picked out a particular handgun for purchase, Miller filled out an ATF Form 4473 for that firearm and falsely represented that he was the actual transferee or buyer of the handgun. In reality, Miller was purchasing the firearm, at Harris’ request, for others.  Miller is alleged to have acted as a straw purchaser. The prosecution of straw purchasers and those with whom they allegedly conspire is an important step in keeping firearms out of the hands of those who will not or cannot lawfully purchase firearms.

This case is the result of an investigation conducted by the Dover Police Department and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives.  The prosecution is being handled by Assistant United States Attorney Jennifer K. Welsh.

The charges in the Indictment are only allegations. The defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

WILMINGTON, Del. – Charles M. Oberly, III, United States Attorney for the District of Delaware, announced today that Tyron Burgess, age 36, of Manhattan, was sentenced today by United States District Court Judge Gregory M. Sleet to 42 months of imprisonment and 3 years of supervised release.  Mr. Burgess was also ordered to pay restitution in the amount of $129,985.02 to five different financial institutions. 

The sentencing came after Mr. Burgess pleaded guilty on March 25, 2014 to one count of conspiracy to commit mail fraud, in violation of 18 U.S.C. § 1349, one count of wire fraud, in violation of 18 U.S.C. § 1343, one count of bank fraud, in violation of 18 U.S.C. § 1344, and one count of aggravated identity theft, in violation of 18 U.S.C. § 1028A.  The aggravated identity theft charge carried a mandatory 24 month term of incarceration.

Between July and November 2011, Mr. Burgess engaged in multiple fraud and identity theft schemes in and around the Dover, Delaware area.  Using stolen personal identification information, Mr. Burgess secured financing for the purchase of an ATV and a Corvette.  Mr. Burgess also obtained at least a dozen credit cards, in the names of others, from two separate financial institutions and purchased luxury clothing items and electronics with those cards.  Mr. Burgess also obtained fraudulent bank loans from another financial institution.

U.S. Attorney Oberly stated, “I am pleased with the sentence Mr. Burgess received.  Identity theft is a serious crime that has a very real impact on its victims and society. Those contemplating similar crimes should be reminded of the likely consequences of their actions.  This office remains committed to prosecuting these offenses.”

“Whether the schemes involve identity theft or identity fraud, Postal Inspectors will continue to work with our law enforcement partners and the financial institutions to protect consumers, said David Bosch, Inspector-In-Charge of the Philadelphia Division of the US Postal Inspection Service”

The case was investigated by the United States Postal Inspection Service and the Social Security Administration Office of the Inspector General, with the assistance of the United States Secret Service.  The case was prosecuted by Assistant United States Attorney Lesley Wolf.  U.S. Attorney Oberly thanked the investigators for their hard work in pursuing this investigation.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that Festus Frimpong, age 19, of Newark, Delaware, was sentenced today by the Honorable Leonard P. Stark, United States District Judge for the District of Delaware, to 46 months imprisonment and full restitution.  The defendant pleaded guilty to violations of 18 U.S.C. § 286 (False Claims Conspiracy) and 18 U.S.C. § 1029(a)(3) (Access Device Fraud), in May, 2014.  The defendant is a citizen of Ghana, and he faces deportation at the conclusion of his term of imprisonment.

The defendant participated in a tax fraud conspiracy involving the filing of more than 300 false individual federal income tax returns with the Internal Revenue Service, using stolen identities.  The investigation uncovered more than 1,000 potential victims.  The returns sought refunds of more than $1.7 million.  The defendant’s role in the conspiracy involved receiving and distributing stolen identity information, including names, addresses, dates of birth, and social security numbers to other co-conspirators.  The defendant also opened bank accounts to receive the proceeds of refunds generated by the false tax returns.

U.S. Attorney Oberly gave the following comments:  “It is gratifying to see the United States District Court, Judge Stark, hand down a sentence of nearly four years of incarceration. Defendants like Mr. Frimpong deserve such sentences and subsequent deportation when applicable. The American public, the ultimate victims in schemes like this need to know that defendants who engage in activities such as this will be prosecuted as felons and incarcerated. This District is committed to vigorously prosecuting defendants like Mr. Frimpong.”

This case is the result of an ongoing investigation conducted by the Internal Revenue Service Criminal Investigation, the United States Postal Inspection Service, and the Social Security Administration Office of the Inspector General.  This case was prosecuted by Assistant United States Attorney Jennifer Welsh.

WILMINGTON, Del. – Four members of an international computer hacking ring have been charged with breaking into computer networks of prominent technology companies and the U.S. Army and stealing more than $100 million in intellectual property and other proprietary data.  Two of the charged members have already pleaded guilty.  The alleged cyber theft included software and data related to the Xbox One gaming console and Xbox Live online gaming system; popular games such as “Call of Duty: Modern Warfare 3” and “Gears of War 3”;  and proprietary software used to train military helicopter pilots.

U.S. Attorney Charles M. Oberly III of the District of Delaware, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, and Special Agent in Charge Stephen E. Vogt of the FBI’s Baltimore Field Office made the announcement.

“Electronic breaking and entering of computer networks and the digital looting of identities and intellectual property have become much too common,” said U.S. Attorney Oberly.  “These are not harmless crimes, and those who commit them should not believe they are safely beyond our reach.”

Nathan Leroux, 20, of Bowie, Maryland; Sanadodeh Nesheiwat, 28, of Washington, New Jersey; David Pokora, 22, of Mississauga, Ontario, Canada; and Austin Alcala, 18, of McCordsville, Indiana, were charged in an 18-count superseding indictment returned by a federal grand jury in the District of Delaware on April 23, 2014, and unsealed earlier today.  The charges in the indictment include conspiracies to commit computer fraud, copyright infringement, wire fraud, mail fraud, identity theft and theft of trade secrets.  The defendants are also charged with individual counts of aggravated identity theft, unauthorized computer access, copyright infringement and wire fraud.

Today, Pokora and Nesheiwat pleaded guilty to conspiracy to commit computer fraud and copyright infringement.  Their sentencings have yet to be scheduled.  Pokora was arrested on March 28, 2014, while attempting to enter the United States at the Lewiston, New York, Port of Entry.  Pokora’s plea is believed to be the first conviction of a foreign-based individual for hacking into U.S. businesses to steal trade secret information. 

According to the superseding indictment and other court records, from January 2011 to March 2014, the four men and others located in the United States and abroad allegedly hacked into the computer networks of Microsoft Corporation, Epic Games Inc., Valve Corporation, Zombie Studios and the U.S. Army.  The defendants and others allegedly obtained access to the victims’ computer networks through methods including SQL injection and the use of stolen usernames and passwords of company employees and their software development partners.  Once inside the victims’ computer networks, the conspirators accessed and stole unreleased software, software source code, trade secrets, copyrighted and pre-release works and other confidential and proprietary information.  Members of the conspiracy also allegedly stole financial and other sensitive information relating to the companies – but not their customers – and certain employees of such companies. 

Specifically, the data cyber-theft allegedly included source code, technical specifications and related information for Microsoft’s then-unreleased Xbox One gaming console; intellectual property and proprietary data related to Xbox Live, Microsoft’s online multi-player gaming and media-delivery system; Apache helicopter simulator software developed by Zombie Studios for the U.S. Army; a pre-release version of Epic’s video game, “Gears of War 3;” and a pre-release version of Activision’s video game, “Call of Duty: Modern Warfare 3.”  The defendants also allegedly conspired to use, share and sell the stolen information. 

The value of the intellectual property and other data that the defendants stole, as well as the costs associated with the victims’ responses to the conduct, is estimated to range between $100 million and $200 million.  To date, the United States has seized over $620,000 in cash and other proceeds related to the charged conduct.

In addition to those charged in the United States, an Australian citizen has been charged under Australian law for his alleged role in the conspiracy. 

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

This case is being investigated by the FBI, with assistance from the Criminal Division’s Office of International Affairs, the U.S. Department of Homeland Security’s Homeland Security Investigations and Customs and Border Patrol, and the U.S. Postal Inspection Service.  The investigation also has been coordinated with the Western Australia Police and the Peel Regional Police of Ontario, Canada. 

WILMINGTON, Del. - David C. Weiss, Acting United States Attorney for the District of Delaware, announced that an Indictment has been handed down by a federal grand jury charging Joseph L. Capano, age 73, of Middletown, Delaware, with three counts of making false statements to federal authorities (18 United States Code §1001(a)), and charging Capano and Riverbend Community LLC, a Delaware Corporation, with conspiracy to violate the Clean Water Act (18 United States Code §371). Defendant Capano faces up to 5 years of imprisonment for the false statement charges, 3 years of imprisonment on the Clean Water Act conspiracy, and a maximum of $250,000 fine for each offense.  Defendant Riverbend faces a fine of up to $500,000 for the Clean Water Act conspiracy. 

The Indictment alleges that Capano and Riverbend Community LLC conspired with others to discharge pollutants into wetlands subject to federal jurisdiction without a permit, during development of Riverbend at Old New Castle, a residential development located off of Delaware State Route 9 in New Castle, Delaware.  The Indictment focuses on earthmoving, construction and excavation activities that Capano, on behalf of Riverbend Community LLC, directed employees and contractors to perform on the entrance road to the development, known as the causeway.  Specifically, the defendants directed contractors and employees to expand the causeway into wetlands subject to federal jurisdiction.  The defendants also directed contractors and employees to place a water main pipe through the causeway wetlands area, even after the Army Corps of Engineers instructed the defendants to stop performing construction in wetland areas.

In addition, the Indictment alleges that Capano knowingly and willfully made multiple false statements to the Army Corps of Engineers regarding when the water main pipe was installed in the causeway wetland areas, including executing a false affidavit, and that he withheld maaterial information from the Army Corps of Engineers.

“Construction activities in wetland areas have the potential to pollute our waters and damage our environment.  Before developers perform work in wetland areas, they must first seek a permit from the Army Corps of Engineers.  When interacting with formal regulators regarding activities in wetland areas, developers must accurately describe the nature of their activities.  Those who fail to do so proceed at their peril.” said Acting United States Attorney David C. Weiss.
“Wetlands play a critical role in maintaining a healthy environment,” said David G. McLeod, Jr., Special Agent in Charge of EPA’s criminal enforcement program in the Middle Atlantic States.  “Once gone, it’s rare to see wetlands fully restored.  EPA and its law enforcement partners are working to protect these invaluable natural assets as well as the communities around them.”

This case is the result of an investigation conducted by the United States Environmental Protection Agency, Criminal Investigation Division Philadelphia Area Office.  The prosecution is being handled by Assistant United States Attorney Jennifer K. Welsh, District of Delaware.
The charges in the Indictment are only allegations. The defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

WILMINGTON, Del. - Charles M. Oberly, III, United States Attorney for the District of Delaware, announced that an Indictment has been handed down by a federal grand jury charging James Ekeke, age 26, of Smyrna, Georgia, with false claims conspiracy (18 U.S.C. § 286), aiding and abetting access device fraud (18 U.S.C. § 1029 & 2), wire fraud (18 U.S.C. § 1343), and money laundering (18 U.S.C. § 1956).  The defendant faces up to 20 years in prison on the wire fraud and money laundering charges, and 10 years on the remaining counts, in addition to possible fines and restitution. 

The Indictment alleges that, from January through November 2013, the defendant obtained hundreds of names and social security numbers of individuals in Delaware, New Jersey, Ohio, and elsewhere.  The defendant supplied the identity information to co-conspirators in Delaware, who used the information to file more than 600 fraudulent tax returns, seeking more than $4 million in refunds.  Many of the victims were individuals who receive Social Security Disability benefits. 

The Indictment further alleges that the tax fraud conspiracy electronically filed the fraudulent tax returns, using another person’s identity, as if the returns were submitted by a tax preparer.  The defendant and his co-conspirators are alleged to have received the refund proceeds into bank accounts they owned and controlled, and they are alleged to have conducted further transactions with the proceeds in cash and by money order, to conceal and disguise the nature and source of the fraudulent tax refunds.

Festus Frimpong, another individual involved in the scheme, has pleaded guilty to false claims conspiracy (18 U.S.C. § 286), and access device fraud (18 U.S.C. § 1029 & 2).  Frimpong awaits sentencing on October 20, 2014.

U.S. Attorney Oberly gave the following comments:  “Offenses like these filed against Mr. Ekeke are crimes affecting the efficient operation of our government and are injurious to all Americans who work hard and pay their taxes.  The theft of money from the government is a priority prosecution of the United States Attorney's Office, and the perpetrators, if convicted can expect to be incarcerated.”

"The IRS enforces the nation's tax laws, but also takes particular interest in cases where someone, for their own personal benefit, has taken what belonged to others,” stated Akeia Conner, Special Agent in Charge. “The use of identity theft to commit refund fraud is of particular concern to IRS Criminal Investigation.  We are pleased with the indictments associated with this investigation due to the cooperative efforts of our law enforcement partners --- United States Postal Inspection Service and the United States Attorney’s Office."

This case is the result of an investigation conducted by the Internal Revenue Service, the United States Postal Inspection Service, and the Social Security Administration, Office of the Inspector General.  The prosecution is being handled by Assistant United States Attorney Lauren Paxton, District of Delaware.