Northern District of Illinois

CHICAGO — John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, today announced an observance of National Crime Victims’ Rights Week.  This year’s observance celebrates victims’ rights, protections and services, and features the theme, “Seek Justice ~ Ensure Victims’ Rights ~ Inspire Hope.”

“While we all work to combat the challenges presented by the coronavirus pandemic, our office remains vigilant in seeking justice on behalf of victims of federal crimes,” said U.S. Attorney Lausch.  “Our attorneys and staff members work tirelessly to advocate for the rights of victims, offering a tremendous amount of support and assistance during an often difficult legal process.”

“Every year, millions of Americans suffer the shock and trauma of criminal victimization, affecting their well-being and sense of security and dignity,” said Attorney General William P. Barr.  “To these victims, we affirm our unwavering commitment to supporting them in their hour of need.  We also commend the thousands of victim advocates and public safety professionals who labor tirelessly to secure victims’ rights and support survivors.”

During National Crime Victims’ Rights Week, victim advocacy organizations, community groups and state, local and tribal law enforcement agencies traditionally host rallies, candlelight vigils, and other events to raise awareness of victims’ rights and services.  This year, many communities are organizing virtual gatherings and online public awareness campaigns.  The annual National Crime Victims’ Service Awards Ceremony will also be postponed until a time when we can honor this year’s award recipients in person.  To learn more about past recipients, visit www.ovc.gov/gallery.

Ronald Reagan proclaimed the first Victims’ Rights Week in 1981, putting crime victims’ rights, needs, and concerns in a prominent spot on the American agenda.  He also established the President’s Task Force on Victims of Crime, which laid the groundwork for a national network of services and legal safeguards for crime victims.  President Trump and his administration have implemented historic levels of support for victim assistance and victim compensation.

Approximately 3.3 million Americans age 12 and older were victims of violent crime in 2018, according to the National Crime Victimization Survey.  The Office for Victims of Crime (OVC), part of the Justice Department’s Office of Justice Programs (OJP), supports more than 7,000 local victim assistance and victim compensation programs in every state and U.S. territory.  Funds for these programs come from the Crime Victims Fund, which is comprised of federal criminal fines, penalties and bond forfeitures.

“While we have made tremendous progress driving down crime and violence across the country, far too many Americans continue to suffer the pain and loss of criminal victimization,” said Katharine T. Sullivan, Principal Deputy Assistant Attorney General of OJP.  “This week, we stand by these survivors and their families, and we pledge our ongoing support to the countless men and women who serve them with such extraordinary skill and compassion.”

“Crime victims deserve to know that they have the encouragement and support of the American people,” said OVC Director Jessica E. Hart.  “I hope that citizens throughout the nation will take the opportunity this week to remember all victims of crime and their heroic stories of survival.”

For more information on how to create your own public campaigns to raise awareness about crime victims’ rights – online and through events during the year – please visit: https://ovc.ncjrs.gov/ncvrw2020/overview.html.

CHICAGO — John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, today announced the appointment of a federal prosecutor to lead the fight against fraud related to the COVID-19 pandemic.

Attorney General William Barr has directed U.S. Attorneys nationwide to remain vigilant in detecting, investigating, and prosecuting criminal activity related to the crisis.  As part of this strategy, U.S. Attorney Lausch appointed Assistant U.S. Attorney Tyler Murray, Chief of the office’s Financial Crimes Section, to serve as the COVID-19 Fraud Coordinator for the Northern District of Illinois.  Working with federal, state, and local law enforcement partners, AUSA Murray will coordinate and lead investigations and prosecutions of those who attempt to take advantage of people during this time of crisis.

To report fraud related to COVID-19, call (866) 720-5721 or file a complaint online at https://www.justice.gov/disaster-fraud/webform/ncdf-disaster-complaint-form.

“My office will vigilantly guard the public from fraudsters who try to take advantage of a vulnerable time for our nation,” said U.S. Attorney Lausch.  “A national crisis is by no means a safe harbor for criminal activity.”

U.S. Attorney Lausch warned the public to be extra cautious about unscrupulous schemes, particularly online.  There have been reports locally and throughout the country of individuals and businesses selling fake cures or test kits for COVID-19 and engaging in other forms of fraud.  Phishing emails from entities posing as the World Health Organization or the Centers for Disease Control and Prevention have been sent to unsuspecting citizens.

U.S. Attorney Lausch offered tips to help avoid scammers:

• Do not click on links from sources you don’t know.  These could be attempts to download viruses onto your computer or cell phone.
• Ignore online offers for vaccinations.  There currently are no vaccines, pills, potions or other prescription or over-the-counter products available to treat or cure COVID-19.
• Do your homework when it comes to donations, whether through charities or crowdfunding websites.  Do not let anyone rush you into making a donation.  If someone asks for a donation in cash, gift card, or wire transfer, do not do it.

CHICAGO — A federal indictment unsealed this week charges ten alleged members of the LAFA street gang with participating in a criminal organization that murdered its rivals and violently protected its drug-dealing territories on the South Side of Chicago.

Law enforcement uncovered the criminal activity through an investigation conducted by the Organized Crime Drug Enforcement Task Force (OCDETF).  Drug or firearm charges were originally filed in related cases against eleven individuals, including a woman and two of her sons.  The superseding indictment unsealed this week adds new defendants and alleges numerous acts of violence, including four murders and 13 attempted murders.  The new charges include racketeering conspiracy against ten of the defendants. 

Arrests were carried out this week in Illinois, Indiana, and Minnesota.  One defendant was arraigned this week in federal court in Chicago, while arraignment dates for the others have not yet been scheduled.

During the course of the multi-year probe, law enforcement seized 34 firearms, a machete and sheath, approximately a kilogram of cocaine, 78 pounds of marijuana, more than $190,000 in suspected illicit cash proceeds, designer clothing appraised at more than $300,000, Rolex watches, and numerous pieces of diamond jewelry, including two necklaces that had attached to them 14-carat gold pendants with the initials “LAFA” written in diamonds.

The superseding indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Charlie Beck, interim Superintendent of the Chicago Police Department.  Substantial assistance was provided by U.S. Attorney’s Offices in the Districts of Northern Indiana and Minnesota; Cook County State’s Attorney’s Office; U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives; IRS Criminal Investigation Division in Chicago; Illinois State Police; Cook County Sheriff’s Office; police departments in Orland Park, Evergreen Park, Bolingbrook and Joliet; Minnesota-based Lake Superior Drug and Violent Crimes Task Force; Duluth, Minn., Police Department; St. Louis County, Minn., State’s Attorney’s Office; and FBI offices in Minneapolis, Minn., and Indianapolis, Ind.  Assistant U.S. Attorneys Sheri Wong, Ankur Srivastava and Paul Mower represent the government.

“These RICO charges are the result of many federal, state, and local law enforcement partners working together to hold violent Chicago gang members accountable for various acts involving murder, attempted murder, witness intimidation, and drug trafficking, and for committing certain firearm offenses,” said U.S. Attorney Lausch.  “Our common mission is clear: we want to keep the people of Chicago and our other communities safe.”

"These charges reflect an outstanding show of teamwork by our law enforcement and prosecutorial partners at all levels,” said Special Agent-in-Charge Buie.  “We will continue to work tirelessly to remove illegal drugs, weapons, and other ill-gotten gains from our streets and ensure that our communities remain safe for all."

The superseding indictment alleges that LAFA members trafficked illicit drugs, including marijuana, cocaine, cocaine base, heroin, methamphetamine, and MDMA, in Chicago and Duluth, Minn.  LAFA members allegedly stole vehicles for use in the affairs of the enterprise, and violently retaliated against rivals, former members, victims, and witnesses to prevent cooperation with law enforcement. 

The charges accuse five alleged LAFA members of committing murder in furtherance of the gang’s activities:

• AKEEM ASAD, 28, of Chicago, allegedly murdered Janeen Hancock and Alixi Johnson on July 23, 2012, in Chicago.
• MARTEZ EASTER, 27, of Chicago, and COTTRELL MACKEY, 26, of Chicago, allegedly murdered Denero Appleton on June 1, 2014, in Chicago.
• MARDI LANE, 31, of Chicago, and REGINALD JONES, 26, of Chicago, allegedly murdered Deonte Hoard on March 2, 2015, in Chicago.

Asad, Lane, Easter, Jones and three other defendants – CAREY HINTON, 27, of Chicago, TONY PARKER, 25, of Chicago, and QUENTIN LUCIOUS, 29, of Chicago – are charged with committing attempted murders on behalf of the gang.

Several firearm offenses are also charged in the indictment, as are multiple counts of witness intimidation.

The investigation was conducted under the OCDETF program, a partnership between federal, state and local law enforcement agencies.  The principal mission of OCDETF is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations.  

The public is reminded that an indictment contains only charges and is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

Racketeering conspiracy generally carries a maximum sentence of 20 years in prison, but a life sentence is possible for certain underlying racketeering activities, including certain murders and attempted murders charged in the indictment.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.

ROCKFORD — A Rockford man pleaded guilty Friday before U.S. District Judge Philip G. Reinhard to charges of transportation of child pornography via the internet and possession of child pornography. 

DONOVAN HEIDENREICH, 25, admitted in a written plea agreement that on Sept. 25, 2017, he used a computer to send a video file over the internet to another user of the KIK messaging application.  The image depicted an actual male child under the age of 18 engaged in sexually explicit conduct.  Heidenreich also admitted that on Nov. 28, 2017, he possessed a laptop computer that contained more than 600 images of children engaged in sexually explicit conduct. Heidenreich further admitted he traded images of children engaged in sexually explicit conduct with other persons in return for his receipt of images of children engaged in sexually explicit conduct.

Sentencing for Heidenreich is set for June 8, 2020, at 9:00 a.m.  For transporting child pornography, HEIDENREICH faces a mandatory minimum sentence of five years in prison and a maximum sentence of 20 years. For possession of child pornography, the maximum is 20 years’ imprisonment.   The sentence will be determined by the United States District Court, guided by the Sentencing Guidelines.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI. The government is represented by Assistant U.S. Attorney Michael D. Love.

CHICAGO — The U.S. Attorney’s Office will monitor the federal and local primary elections in Chicago and surrounding suburbs on March 17, 2020, John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, announced today.

As part of the monitoring effort, the office will operate a telephone hotline for citizens to report complaints related to the voting process.  Assistant U.S. Attorneys and other office personnel will monitor the hotline and respond to complaints, as needed.

The hotline number, staffed on Election Day only, is (312) 469-6157.

“A vital part of our democracy is the integrity of our electoral system,” said U.S. Attorney Lausch.  “A citizen who is entitled to vote should not be hindered or prevented from doing so, and we stand ready to ensure the sanctity of the process.”

The Department of Justice has an important role in deterring election fraud and discrimination at the polls, and combating these violations wherever they occur.   The Department’s longstanding Election Day Program seeks to ensure public confidence in the voting process.

Federal voting-rights laws protect the rights of voters to mark their own ballot or be assisted by a person of their choice.  Actions designed to interrupt or intimidate voters at polling places may constitute a violation.  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.  Violations carry penalties ranging from one to ten years in prison, and fines of up to $250,000.

For information as to the location and hours of polling sites, Illinois residents are advised to contact the Illinois State Board of Elections by logging on to www.elections.il.gov or by calling (312) 814-6440.

CHICAGO — A north suburban man has pleaded guilty to federal criminal charges for threatening to publish sexually explicit images of an underage girl unless she sent him more explicit photos and videos of herself.

DAVID J. COTTRELL, 30, of Niles, enticed the underage victim into sending him sexually explicit photos of herself via online social messaging applications.  After collecting the photos, Cottrell informed the girl that he knew her real name, the name of her school, and her parents’ jobs, and he threatened to post the images online and send them to her family unless the girl sent him additional, more explicit photos and videos, which she did.  Cottrell contacted the victim on a regular basis until her parents discovered the messages in 2017 and contacted law enforcement.

Cottrell pleaded guilty Wednesday to one count of sexual exploitation of a child, which is punishable by a mandatory minimum sentence of 15 years in federal prison and a maximum of 30 years, and one count of possession of child pornography, which is punishable by up to ten years.  U.S. District Judge Robert W. Gettleman set sentencing for June 4, 2020, at 10:30 a.m.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and James M. Gibbons, Special Agent-in-Charge of the Chicago office of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.  The government is represented by Assistant U.S. Attorney Charles W. Mulaney.

Cottrell admitted in a plea agreement that he similarly induced or attempted to induce four other minor victims into sending him sexually explicit images of themselves.  While communicating with the victims online, Cottrell used the screennames “sevendollarcab,” “brightcitylights,” “b88785,” and “YouShallSubmitToMe Sir.”

If you believe you are a victim of sexual exploitation, you are encouraged to call the National Center for Missing and Exploited Children by calling 1-800-843-5678, or logging on to www.cybertipline.com.

CHICAGO — A federal judge in Chicago has sentenced a contractor to more than three years in prison for paying bribes to the mayor of Markham to maintain and expand business with the south suburb.

MICHAEL JARIGESE, 67, of Frankfort, was convicted last year on nine counts of wire fraud and one count of bribery.  The jury also convicted Mokena-based TOWER CONTRACTING LLC on the same charges.  Jarigese was Tower’s president when he paid more than $80,000 in bribes to Markham Mayor DAVID WEBB JR. to maintain contracting work and obtain future business from the city.  To conceal the bribes, Jarigese provided Webb with a false invoice and used coffee cups to hide cash payments.  In exchange for the money, Webb took official action that benefited Jarigese and Tower, such as helping to award the company a multi-million dollar construction project.

U.S. District Judge Robert W. Gettleman on Thursday sentenced Jarigese to three years and five months in prison.  Judge Gettleman fined Tower Contracting $1.2 million and sentenced it to four years of probation.

The sentences were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  The U.S. Securities and Exchange Commission provided valuable assistance.

“By bribing Webb, Jarigese rigged the system, ensuring that Tower’s uncompetitive and unchallenged proposals were the only option presented to the Markham City Council,” Assistant U.S. Attorneys Steven J. Dollear, Heather K. McShain and Georgia N. Alexakis argued in the government’s sentencing memorandum.  “Markham did not get the best value for each of the construction projects completed by Tower; instead, they were subject to a corrupt relationship between Jarigese, Tower, and Webb.”

Webb, who served as mayor of Markham from 2001 to 2017, pleaded guilty prior to trial and admitted participating in the scheme.  Webb’s sentencing has not yet been scheduled.

A fourth defendant, THOMAS SUMMERS, owner of an Alsip-based sewer business, was tried separately and convicted last year of making false statements to the FBI and IRS.  Summers is set to be sentenced by Judge Gettleman on April 28, 2020.

WASHINGTON – The Justice Department and the Drug Enforcement Administration (DEA) today announced the results of Project Python, a DEA-led interagency operation encompassing all global investigations and related disruption activities targeting the Cártel de Jalisco Nueva Generación (CJNG).

This announcement marks the successful conclusion of six months of investigative and enforcement activity targeting CJNG, culminating in large scale arrests throughout the country within the past week.  Project Python has resulted in more than 600 arrests, 350 indictments, as well as significant seizures of money and drugs.  In the DEA's Chicago Division, which includes Illinois, Wisconsin and Indiana, approximately 50 arrests at the federal and state level have been made against CJNG members and associates pursuant to Project Python enforcement actions.

“With today’s announcement, the Attorney General has made clear the Department’s focus on dismantling transnational criminal organizations,” said John R. Lausch, Jr., United States Attorney for the Northern District of Illinois.  “We will continue to investigate and hold accountable members of drug cartels who seek to traffic narcotics in our communities.”

“DEA classifies the CJNC as one of the five most dangerous criminal organizations in the world,” said Robert J. Bell, DEA Chicago Division Special Agent-in-Charge.  “CJNG has used extreme violence, extortion and bribes to steadily expand trafficking networks.  CJNG is one of the two most prolific transnational criminal organizations responsible for trafficking huge quantities of illegal drugs to the Chicago Division.  Project Python is a coherent effort to focus national efforts on the plague CJNG spreads.  DEA will continue aggressively working with its federal, state and local partners to make Illinois, Indiana and Wisconsin inhospitable places for the CJNG.”

“Project Python marks the most comprehensive action to date in the Department of Justice’s campaign to disrupt, dismantle, and ultimately destroy CJNG,” said Assistant Attorney General Brian A. Benczkowski of the Department of Justice's Criminal Division.  “When President Trump signed an Executive Order prioritizing the dismantlement of transnational criminal organizations, the Department of Justice answered the call and took direct aim at CJNG.  We deemed CJNG one of the highest-priority transnational organized crime threats we face.  And with Project Python, we are delivering results in the face of that threat for the American people.” 

“Project Python is the single largest strike by U.S. authorities against CJNG, and this is just the beginning,” said Acting DEA Administrator Uttam Dhillon. “This strategic and coordinated project exemplifies DEA’s mission: to disrupt, dismantle, and destroy drug trafficking organizations around the world and bring their leaders to justice.  Today, DEA has disrupted CJNG’s operations, and there is more to come as DEA continues its relentless attack on this remorseless criminal organization.”

The Justice Department and its law enforcement partners are committed to fulfilling the President’s Executive Order 13773 to identify, interdict, disrupt and dismantle transnational criminal organizations.  The department designated CJNG as one of the top transnational criminal groups targeted as part of carrying out this executive order, and DEA instituted Project Python to support this ongoing effort. 

CJNG is one of the fastest growing transnational criminal organizations in Mexico, and among the most prolific methamphetamine producers in the world.  It is responsible for a significant proportion of drugs entering the United States, and elevated levels of violence in Mexico.  With methamphetamine abuse and overdose deaths on the rise, Project Python aims to disrupt CJNG’s ability to distribute methamphetamine and other drugs throughout the United States by attacking the group at all levels. 

Federal law enforcement has taken a number of steps to degrade CJNG’s ability to operate in the United States.  Today, the Justice Department and DEA announced a superseding indictment on charges of alleged continuing criminal enterprise against Nemesio Ruben Oseguera Cervantes, also known as “El Mencho,” the undisputed leader of CJNG.  Last month, El Mencho’s son, Ruben Oseguera Gonzalez, also known as “Menchito,” and second in command of CJNG, was extradited from Mexico to the United States on charges of alleged drug trafficking and firearm use in relation to drug trafficking activities.  On Feb. 26, 2020, El Mencho’s daughter, Jessica Johanna Oseguera Gonzalez, was arrested in the United States on financial charges related to her alleged criminal violation of the Foreign Narcotics Kingpin Designation Act.

Additionally, DEA has worked with its interagency partners to apply further pressure to CJNG.  The U.S. Department of Treasury has designated El Mencho as a “specially designated narcotics trafficker” pursuant to the Foreign Narcotics Kingpin Designation Act, and the U.S. Department of State has issued one of the largest narcotics rewards ever – $10 million – for information leading to the arrest of El Mencho.   

The efforts highlighted in the more than 600 arrests nationwide are illustrative of the significant reach the CJNG has in manufacturing, importing and distributing a wide array of illegal narcotics within the United States and the negative impact on the fabric of our local communities.  The proceeds from the local distribution of these narcotics are repatriated back to Mexico and further fuel transnational organized criminal organizations such as the CJNG.  The Department of Justice and its law enforcement partners will continue to vigorously fight this scourge against the United States. 

The Department of Justice’s multi-agency Special Operations Division, federal prosecutors from the Narcotic and Dangerous Drug Section of the Department’s Criminal Division, the Criminal Division’s Office of International Affairs and Office of Enforcement Operations provided invaluable support to this operation.

CHICAGO — A Chicago consultant has been indicted in federal court for allegedly corruptly offering money to an Illinois State Senator in connection with obtaining state approval for a suburban development project.

WILLIAM A. HELM, 56, of Chicago, is charged with one count of federal program bribery.  The indictment was returned Thursday in U.S. District Court in Chicago.  Arraignment is set for March 10, 2020, at 2:00 p.m., before U.S. Magistrate Judge Sheila M. Finnegan.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  The government is represented by Assistant U.S. Attorneys Christopher J. Stetler and James P. Durkin.

According to the indictment, Helm and his consulting firm were retained by a construction company to assist in obtaining approval from the Illinois Department of Transportation for signalization and roadwork in connection with the company’s development project in East Dundee.  The company sought approval from IDOT in 2017, the indictment states.  From July 2018 to at least November 2018, Helm corruptly offered and agreed to pay money to influence and reward the senator in connection with IDOT approval of the project, the indictment states.  At the time, the senator was Chairman of the Senate Transportation Committee and was in a position to assist with obtaining such approvals, the indictment states.

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The charge in the indictment is punishable by up to ten years in federal prison.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.

WASHINGTON – John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, today joined Attorney General William P. Barr in announcing the Department of Justice’s National Nursing Home Initiative, which will coordinate and enhance civil and criminal efforts to pursue nursing homes that provide grossly substandard care to their residents. 

This initiative is focusing on some of the worst nursing homes around the country and the Department has already initiated investigations into approximately thirty individual nursing facilities in nine states as part of this effort. 

“Millions of seniors count on nursing homes to provide them with quality care, and to treat them with dignity and respect when they are most vulnerable,” said Attorney General William P. Barr.  “Yet, all too often, we have found nursing home owners or operators who put profits over patients, leading to instances of gross abuse and neglect. This national initiative will bring to justice those owners and operators who have profited at the expense of their residents, and help to ensure residents receive the care to which they are entitled.” 

“Protecting older Americans in nursing facilities is a top priority for the Department of Justice,” said U.S. Attorney Lausch.  “We are committed to defending our vulnerable seniors from those who abuse or neglect them.”

The department considers a number of factors in identifying the most problematic nursing homes.  For example, the department looks for nursing homes that consistently fail to provide adequate nursing staff to care for their residents, fail to adhere to basic protocols of hygiene and infection control, fail to provide their residents with enough food to eat so that they become emaciated and weak, withhold pain medication, or use physical or chemical restraints to restrain or otherwise sedate their residents.  These care failures cause residents to suffer in pain and to be exposed to the great indignities.  Care failures cause residents to develop pressure sores down to the bone, to lie in their own waste for hours, to starve because they cannot reach the food on their trays and to remain unwashed for weeks at a time.  Nursing homes that provide grossly substandard care also force vulnerable elderly residents who cannot leave the facilities to live in filthy and dangerous conditions where there are leaks in the roofs, mold is found growing and rodents found living in residents’ rooms.  These are some of the actions and the inactions that the department intends to pursue.

The National Nursing Home Initiative reflects the department’s larger strategy and commitment to protecting our nation’s seniors, coordinated by the department’s Elder Justice Initiative in conjunction with U.S. Attorneys’ Offices across the country.  The Elder Justice Initiative and the U.S. Attorneys’ Offices are essential to the department’s investigative and enforcement efforts against nursing homes and other long-term care entities that deliver grossly substandard care to Medicare and Medicaid beneficiaries.  The Initiative and the U.S. Attorneys’ Offices also support the efforts of state and local prosecutors, law enforcement, and other elder justice professionals to combat elder abuse, neglect and financial exploitation, with the development of training, resources, and information.  Learn more about the Justice Department’s Elder Justice Initiative at http://www.justice.gov/elderjustice/.

CHICAGO — A federal jury in Chicago has convicted a Chinese national of laundering illegal narcotics proceeds on behalf of drug traffickers in Mexico.

On three occasions in 2018, XIANBING GAN schemed to have narcotics proceeds totaling approximately $534,206 picked up in Chicago and transferred to various bank accounts in China, in order for the money to ultimately be remitted to drug traffickers in Mexico.  Gan is a Chinese national who facilitated the money transfers while residing in Guadalajara, Mexico.  Unbeknownst to Gan, a purported money courier who picked up the drug proceeds in Chicago was actually an undercover law enforcement agent.

U.S. authorities arrested Gan in November 2018 at Los Angeles International Airport during a brief layover on a flight from Hong Kong to Mexico.  He has remained in U.S. custody since then.

After a nearly two-week trial, a federal jury in Chicago on Thursday convicted Gan, 49, on three counts of money laundering and one count of operating an unlicensed money transmitting business.  The jury acquitted Gan on one count of conspiracy to commit money laundering. 

Each money laundering count is punishable by up to 20 years in federal prison, while the maximum sentence for the money transmission crime is five years.  U.S. District Judge Thomas M. Durkin set sentencing for May 21, 2020.

The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; James M. Gibbons, Special Agent-in-Charge of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Chicago; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  The government is represented by Assistant U.S. Attorneys Richard M. Rothblatt and Sean J.B. Franzblau.

CHICAGO — A suburban man has been sentenced to more than a dozen years in federal prison for amassing a collection of nearly 200,000 images and videos of child pornography.

JONATHAN STEPHENS, 50, of Forest Park, used a computer to access file-sharing software and download child pornography.  Over a period of at least four years, Stephens amassed a collection of approximately 194,000 sexually explicit images and videos that he stored on computers and external hard drives in his home and which he allowed other users to access and download.  Many of the minors in the images and videos were under the age of 12 and forced to engage in sadistic and masochistic conduct.

Stephens pleaded guilty in 2018 to one count of transportation of child pornography.  U.S. District Judge Ronald A. Guzman on Wednesday sentenced Stephens to 12 years and seven months in prison, to be followed by nine years of supervised release.  Judge Guzman also ordered Stephens to pay $187,500 in restitution to the known child victims.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The case was investigated by the FBI’s Child Exploitation and Human Trafficking Task Force, specifically members from the Cook County Sheriff’s Office and Cook County State Attorney’s Investigations Bureau, as well as  the Forest Park Police Department.

“The defendant’s victims are numerous,” Assistant U.S. Attorney Jeannice W. Appenteng argued in the government’s sentencing memorandum.  “Each child depicted in the images and videos went through a horrible experience and continues to relive that suffering and endure new suffering because of the defendant’s actions.”

The government was represented in the case by Ms. Appenteng and Assistant U.S. Attorney Jared C. Jodrey.

If you believe you are a victim of sexual exploitation, you are encouraged to contact the National Center for Missing and Exploited Children by logging on to www.missingkids.com/home or by calling 1-800-843-5678.  The service is available 24 hours a day, seven days a week.

CHICAGO — A federal jury has convicted an Indiana man of kidnapping a child from a Calumet City street as she walked home from school.

On Dec. 20, 2017, at approximately 3:30 p.m., BRYAN PROTHO grabbed the child as she walked on a sidewalk in the south suburb.  Protho forcibly dragged the victim into a red Ford Explorer sport-utility vehicle and drove away.  He then parked the vehicle in a nearby alley and assaulted the child.  The victim was able to get out of the car and flag down a passing vehicle, and law enforcement was contacted.  The kidnapping was captured on a residential surveillance system.

Protho was arrested on Dec. 27, 2017, and he has remained in federal custody since then.  During the two-week trial in federal court in Chicago, the victim testified about her ordeal and identified Protho has her abductor.

The jury on Monday convicted Protho, 41, of East Chicago, Ind., on one count of kidnapping.  The conviction is punishable by a minimum sentence of 20 years in federal prison and a maximum of life.  U.S. District Judge Andrea R. Wood did not immediately set a sentencing date.  A status hearing was scheduled for March 5, 2020.

The Calumet City Police Department led the investigation, with assistance from the FBI and the Lansing Police Department.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Christopher Fletcher, Chief of the Calumet City Police Department; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Dennis Murrin, Jr., Chief of the Lansing Police Department.  The officials thanked members of the community for providing valuable assistance in the investigation.

The government is represented by Assistant U.S. Attorney Christopher V. Parente and Kelly Guzman.

CHICAGO — A Chicago man has been arrested on a federal child pornography charge for allegedly enticing an underage girl to produce sexually explicit videos of herself.

HUGH B. FOWLER enticed the 16-year-old girl to produce the videos and send them to him last year, according to a criminal complaint and affidavit filed in federal court in Chicago.  Fowler communicated with the victim via an online messaging application, the complaint states.

The complaint charges Fowler, 62, with one count of production of child pornography.  Fowler was arrested on Wednesday.  U.S. Magistrate Judge Gabriel A. Fuentes scheduled a detention hearing for Feb. 25, 2020, at 3:00 p.m.

The complaint and arrest were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Charlie Beck, interim Superintendent of the Chicago Police Department.  The case was investigated by the FBI’s Child Exploitation and Human Trafficking Task Force, specifically members from the Chicago Police Department and Cook County Sheriff’s Office, as well as officers from CPD’s 19th District.  The government is represented by Assistant U.S. Attorney Erin E. Kelly.

According to the complaint, Fowler sent the victim detailed instructions for how he wanted the sexually explicit videos to look.  Fowler told the victim to display her private parts and to write Fowler’s first name or his initial on her body, the complaint states.  “I would like music if possible,” Fowler wrote to the victim, according to the complaint.  “It’s better if the video is longer than short,” Fowler allegedly told the victim.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. 

Production of child pornography is punishable by a minimum sentence of 15 years in federal prison and a maximum of 30 years.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

If you believe you are a victim of sexual exploitation, you are encouraged to contact the National Center for Missing and Exploited Children by logging on to www.missingkids.com or by calling 1-800-843-5678.  The service is available 24 hours a day, seven days a week.

CHICAGO — Ten defendants have been charged in federal court with conspiring to illegally conduct a multi-million dollar sports gambling business in the Chicago area.

VINCENT DELGIUDICE, also known as “Uncle Mick,” directed an operation that accepted wagers from as many as 1,000 gamblers on the outcome of professional and amateur sporting events, according to a nine-count indictment returned Wednesday in U.S. District Court in Chicago.  Delgiudice paid a service fee to a foreign sportsbook for use of its platform, and recruited gamblers to place wagers on a website, www.unclemicksports.com, according to the charges.  Delgiudice sometimes communicated with representatives of the sportsbook via an anonymous, end-to-end encrypted messaging application to ensure their communications remained secret, the indictment states.

The indictment alleges that Delgiudice also recruited several individuals to work on behalf of his gambling operation.  These agents enlisted new gamblers and worked with Delgiudice to collect or pay out cash depending on the outcome of wagers, the indictment states.  Delgiudice paid the agents a commission based on a percentage of losses incurred by the gamblers they recruited, the charges allege.

A law enforcement search of Delgiudice’s residence in Orland Park seized more than $1.06 million in cash; silver bars and jewelry valued at $347,895; and gold coins valued at $92,623.  The indictment seeks forfeiture of these items, as well as Delgiudice’s residence.  It also seeks a personal money judgment against Delgiudice of $8 million.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  The government is represented by Assistant U.S. Attorneys Ankur Srivastava, Terry Kinney, and Abigail Peluso. 

The FBI’s Integrity in Sport and Gaming Initiative (ISG) is designed to tackle illegal sports gambling and combat threats of influence from criminal enterprises.

The indictment charges Delgiudice, 54, with one count of conspiracy to conduct an illegal gambling business, one count of conducting an illegal gambling business, one count of conspiracy to commit money laundering, and six counts of money laundering. 

The indictment charges eight alleged agents of Delgiudice’s operation with one count of participating in the gambling conspiracy and one count of conducting an illegal gambling business: MATTHEW KNIGHT, also known as “Sweaters” and “McDougal,” 46, of Mokena; JUSTIN HINES, 40, of Algonquin; KEITH D. BENSON, 49, of Lemont; TODD BLANKEN, 43, of Cary; NICHOLAS STELLA, 42, of Chicago; MATTHEW NAMOFF, 23, of Midlothian; CASEY URLACHER, 40, of Libertyville; and VASILIOS PRASSAS, 37, of Chicago.  The tenth defendant, EUGENE DELGIUDICE, also known as “Gino,” 84, of Orland Park, allegedly assisted in the collection or paying out of cash to gamblers recruited by Vincent Delgiudice.  Eugene Delgiudice is charged with one count of participating in the gambling conspiracy and one count of conducting an illegal gambling business. 

Arraignments in federal court in Chicago have not yet been scheduled.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  Each money laundering count carries a maximum sentence of 20 years in federal prison, while the other counts in the indictment are each punishable by up to five years.  If convicted, the Court must impose reasonable sentences under federal statutes and the advisory U.S. Sentencing Guidelines.

CHICAGO — A sales agent for a Chicago-area red-light camera company has been indicted for allegedly conspiring to pay bribes to obtain approval to install additional cameras in suburban Oak Lawn.

PATRICK J. DOHERTY, 64, of Palos Heights, is charged with one count of conspiracy to use an interstate facility to facilitate bribery, and two counts of using an interstate facility to facilitate bribery.  The indictment was returned Thursday in U.S. District Court in Chicago.  An arraignment date has not yet been scheduled.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  The government is represented by Assistant U.S. Attorneys Christopher J. Stetler, Tiffany A. Ardam and James P. Durkin.

According to the indictment, Doherty worked as a sales agent for the red-light camera company that since 2014 had a contract with Oak Lawn to provide cameras at certain intersections.  Renewal of the contract and installation of cameras at additional intersections required approval from Oak Lawn’s Board of Trustees, the indictment states. 

The charges allege that in 2017 Doherty conspired with an individual with a financial interest in the red-light camera company and another sales agent of the company to pay money to a relative of an elected Oak Lawn Trustee to influence the Trustee into using his official position to approve installation of cameras at additional intersections.  The conspirators agreed to pay the relative a total of approximately $4,000 over an eight-week period, the indictment states.  In order to conceal the purpose of the payments, the conspirators agreed that Doherty would make the payments from a separate company, the indictment states.

In a telephone conversation on May 25, 2017, Doherty told the other sales agent that Doherty would pay the Trustee’s relative “if it’s going to get us the job,” according to the indictment.  Doherty allegedly added, “I’ll just pay it.  Just make sure we get the, make sure we get the [expletive] thing, the contract.”

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

Each count in the indictment is punishable by up to five years in prison.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.

CHICAGO — The owner of a construction company has been indicted for allegedly fraudulently obtaining more than $2.75 million in Chicago Housing Authority contracts designed to benefit minority-owned businesses.

LESTER COLEMAN owned Coleman Development Corp., a Chicago-based construction company and certified minority-owned business.  From 2010 to 2018, Coleman falsely represented to the CHA that his company would perform construction work sufficient to satisfy the agency’s minority-owned business requirements, which mandated that a certain percentage of work on CHA properties be performed by minority or women-owned enterprises, according to an indictment returned Thursday in U.S. District Court in Chicago.  In reality, Coleman subcontracted nearly all of the work to a company that was not certified as a minority-owned business, the indictment states.  Coleman, through his company, fraudulently obtained more than $2.75 million in payments from the CHA contracts, including for construction or rehab work on properties in the Chicago neighborhoods of West Ridge, North Park, Albany Park, Archer Heights, and Oakland, the indictment states.

The charges also allege that Coleman falsely represented and certified to the CHA that the employees performing the work were paid the prevailing wages required by federal labor laws, when, in fact, they were not paid the prevailing wages.

The indictment charges Coleman, 62, of Chicago, with three counts of wire fraud.  An arraignment date in federal court in Chicago has not yet been scheduled.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Elissa Rhee-Lee, Inspector General of the CHA; Brad Geary, Special Agent-in-Charge of the U.S. Department of Housing and Urban Development’s Office of Inspector General in Chicago; and Irene Lindow, Special Agent-in-Charge of the U.S. Department of Labor’s Office of Inspector General in Chicago.  The government is represented by Assistant U.S. Attorney Stephen Heinze.

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. 

Each count of wire fraud is punishable by up to 20 years in federal prison.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

Complaints of fraud at the CHA may be reported to the CHA’s Office of Inspector General  by clicking here.

A federal jury found a Chicago woman guilty today for her role in a scheme to defraud Medicare of approximately $7 million between 2011 and 2017.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney John R. Lausch Jr. of the Northern District of Illinois, Special Agent in Charge Emmerson Buie Jr. of the FBI’s Chicago Field Office and Special Agent in Charge Lamont Pugh III of the United States Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Division Office made the announcement.

After a four-day trial, Angelita Newton, 42, was found guilty of one count of conspiracy to commit health care fraud and wire fraud.   Sentencing has been scheduled for Oct. 13, 2020 before U.S. District Judge Virginia Kendall of the Northern District of Illinois, who presided over the trial. 

According to evidence presented at trial, from approximately 2011 to 2017, Newton worked at Care Specialists, a home health company based in Chicago, Illinois, and owned by Ferdinand Echavia, 46, and Ma Luisa Echavia, 44, both of Chicago.  Newton was the Echavias’ employee and personal assistant.  In that role, Newton conspired with the Echavias and others to submit claims to Medicare for unnecessary home health services for unqualified patients, or for visits that did not happen as billed, the evidence showed.  Newton created and completed visit notes and other documents purporting to reflect nursing services purportedly rendered by Ferdinand Echavia with the knowledge that he was not actually providing the services.  Newton was aware that Ferdinand Echavia was making cash payments to patients, which Newton knew to be illegal, the evidence showed.

The evidence at trial showed that between 2011 and 2017, Medicare paid Care Specialists approximately $7 million for home health care services. 

Three other defendants have been charged in connection with the fraud at Care Specialists.  Ferdinand Echavia pleaded guilty to conspiracy to commit health care fraud and wire fraud on Jan. 28, 2020, and is awaiting sentencing.  Ma Luisa Echavia pleaded guilty to conspiracy to commit health care fraud and wire fraud on Jan. 29, 2020, and is awaiting sentencing.  A former nurse at Care Specialists, Reginald Onate, 31, of Aurora, Illinois, pleaded guilty to one count of conspiracy to commit health care fraud, and is awaiting sentencing. 

This case was investigated by the FBI and HHS-OIG.  Trial Attorneys Leslie S. Garthwaite and Patrick Mott of the Criminal Division’s Fraud Section are prosecuting the case.  Former Trial Attorney Jessica Collins of the Fraud Section previously handled the prosecution.   

The Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.

CHICAGO — A federal jury in Chicago has convicted a physician on fraud charges for approving medically unnecessary tests that were billed to Medicare.

While working for Chicago-based Grand Medical Clinic Inc., DR. OMAR GARCIA authorized percutaneous allergen tests for numerous Medicare beneficiaries, knowing that the tests were not medically necessary.  In most instances, Dr. Garcia issued his approval after the tests had already been completed.  Dr. Garcia submitted or caused to be submitted fraudulent claims to Medicare for payment of the unnecessary tests.

The jury in federal court in Chicago on Monday convicted Dr. Garcia, 52, of Ocala, Fla., and formerly of Wilmington, Ill., on all six counts of health care fraud.  Each count is punishable by a maximum sentence of ten years in prison.  U.S. District Judge Matthew F. Kennelly set sentencing for May 6, 2020.

The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; and Martin J. Dickman, Inspector General of the U.S. Railroad Retirement Board.  The U.S. Office of Personnel Management and the U.S. Food and Drug Administration provided valuable assistance.  The government is represented by Assistant U.S. Attorneys Kavitha J. Babu and Saurish Appleby-Bhattacharjee.

Evidence at the five-day trial revealed that Dr. Garcia’s fraud scheme began in 2011 and continued until 2015.  Dr. Garcia and others submitted the fraudulent bills from Grand Medical and other medical entities in an attempt to reduce the volume of billing by any single company and minimize scrutiny from Medicare.  After the entities received payments from Medicare, Dr. Garcia was paid via checks reflecting his percentage of the payments.

CHICAGO — A former suburban insurance agent has been indicted on federal fraud charges for allegedly swindling money from an elderly client.

DIANE LAZAR was a licensed insurance producer and authorized agent of various insurance companies.  Beginning in 2008 and continuing until 2014, Lazar submitted applications for an elderly client in his 80s to purchase several annuities and a life insurance policy from the companies Lazar represented, according to an indictment returned in U.S. District Court in Chicago.  Upon approval of the applications, the client paid hundreds of thousands of dollars in premiums and Lazar received commissions from the companies, the indictment states.  In some instances, Lazar designated her daughter as the beneficiary of the annuities, falsely claiming that her daughter was the client’s grandchild or great grandchild, the indictment states. 

Upon the client’s death in 2014, Lazar attempted to fraudulently collect some of the client’s annuity and insurance proceeds, the indictment alleges.  She also submitted a phony power of attorney to the client’s bank to fraudulently withdraw approximately $100,000 from his checking account, the indictment states.

The indictment was returned on Feb. 4, 2020.  It charges Lazar, 46, of Cape Coral, Fla., and formerly of Palos Heights, with two counts of wire fraud, one count of bank fraud, and one count of making a false statement to a financial institution.  Arraignment is set for Feb. 12, 2020, at 10:00 a.m., before U.S. District Judge Charles R. Norgle, Sr.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The government is represented by Assistant U.S. Attorney Corey B. Rubenstein.

“Keeping older Americans safe from fraud is a top priority for the Department of Justice,” said U.S. Attorney Lausch.  “We are committed to protecting our vulnerable seniors from those who seek to exploit them.”

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. 

The bank fraud and false statement counts are each punishable by up to 30 years in federal prison, while each count of wire fraud is punishable by up to 20 years.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

Elder fraud complaints may be filed with the Federal Trade Commission at www.ftccomplaintassistant.gov or at 877-FTC-HELP.  More information about the Department of Justice’s efforts to help seniors is available at its Elder Justice Initiative webpage.

CHICAGO — A Chicago man has been found guilty of illegally structuring nearly $350,000 in cash deposits in an effort to evade federal reporting requirements.

In 2015 and 2016, ANTUANE KING made at least 37 deposits of less than $10,000 each at seven financial institutions, including the Chicago Firefighters Credit Union.  The deposits were structured in an effort to evade federal reporting rules, which require financial institutions to notify the U.S. Department of the Treasury about transactions of more than $10,000.  After making all of the structured cash deposits, King later combined all of the money to purchase three residences in Markham, Lynwood, and Homewood.

A federal jury in Chicago on Wednesday convicted King, 49, on two counts of structuring a currency transaction.  Each count is punishable by up to five years in federal prison.  U.S. District Judge Jorge L. Alonso set sentencing for June 12, 2020.

The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  The government is represented by Assistant U.S. Attorneys Christopher V. Parente and Esther Mignanelli.

ROCKFORD — Seven Rockford residents have been arrested by law enforcement officers on federal drug-trafficking and firearm charges. 

DEREK D. JACOBS, also known as “Showtime” and “G,” 27, and RICO L. TURNER, 27, were arrested on charges of conspiracy to distribute fentanyl and heroin in Rockford from July through August 2019.  The indictment returned last week also charged Jacobs with one count of distribution of heroin and two counts of distribution of fentanyl, and charged Turner with three counts of distribution of fentanyl.

Additional arrests in related cases included:

MICHAEL A. ALEXANDER, also known as “Big Mike,” 43, who was charged with four counts of distribution of cocaine base or “crack,” and one count of distribution of crack cocaine, fentanyl, and heroin.

RASHOD C. DAVIS, also known as “Rock,” 24, who was charged with one count of distribution of heroin and one count of distribution of a mixture containing fentanyl and heroin.

MARCUS I. RAYMOND, 24, TERRAIL HUNTER, 48, and CHARLES DAVIS, 26, were each charged in separate cases with illegally possessing a firearm as a convicted felon.

The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives; and Dan O’Shea, Rockford Police Chief.   The FBI, Winnebago County Sheriff’s Office, and Illinois State Police assisted in the investigation. The government is represented by Assistant U.S. Attorney Vincenza Tomlinson.

Jacobs, Turner, Alexander, Rashod Davis, and Hunter appeared before U.S. Magistrate Judge Lisa A. Jensen in federal court in Rockford.  Alexander pleaded not guilty and stipulated to detention.  Jacobs, Turner, and Hunter each pleaded not guilty and remain in custody pending detention hearings.  The hearings for Jacobs and Turner are scheduled for Feb. 6, 2020, and the detention hearing for Hunter is scheduled for Feb. 5, 2020.  Rashod Davis was placed on home incarceration with location monitoring. 

The public is reminded that charges contain only accusations and are not evidence of guilt.  Each defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

The conspiracy count against Jacobs and Turner carries a five-year mandatory minimum prison sentence and a maximum sentence of 40 years.  Each count against Jacobs, Turner, Alexander, and Rashod Davis for distribution of heroin, a mixture containing heroin and fentanyl, and crack cocaine carry a maximum sentence of 20 years.  The charge of illegal possession of a firearm by a convicted felon against Raymond, Hunter, and Charles Davis carries a maximum sentence of ten years.  If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.

Federal charges were also announced last week against three Rockford-area residents for alleged drug trafficking.

Holding drug dealers and illegal firearm possessors accountable through federal prosecution is a centerpiece of Project Guardian and Project Safe Neighborhoods (PSN) – the Department of Justice’s violent crime reduction strategies.  Project Guardian focuses specifically on investigating, prosecuting, and preventing gun crimes, and it emphasizes the importance of using modern technologies to promote gun crime intelligence.  In the Northern District of Illinois, U.S. Attorney Lausch and law enforcement partners have deployed the Guardian and PSN programs to attack a broad range of violent crime issues facing the district.

CHICAGO — A north suburban man pleaded guilty today to federal fraud and tax offenses in connection with a $9.6 million fraud scheme.

ROBERT GORODETSKY, 27, of Northbrook, pleaded guilty to one count of wire fraud and one count of filing a false tax return.  U.S. District Judge Elaine E. Bucklo set sentencing for April 29, 2020.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The government is represented by Assistant U.S. Attorney Patrick J. King, Jr.

Gorodetsky admitted in a plea agreement that from 2014 to 2018 he schemed to defraud an individual of approximately $9.6 million in connection with purported stock market investments and wagers on sporting events.  Gorodetsky represented himself as a successful “day trader” who would invest the individual’s money in the stock market and share in the profits, the plea agreement states.  After initially obtaining approximately $953,000 from the individual, Gorodetsky invested only $215,000 of it and pocketed the rest for his personal use, the plea agreement states.

Gorodetsky later falsely told the individual that his investments had increased to $2 million, and that the purported gains should be put toward sports wagers, according to the plea agreement.  Gorodetsky induced the individual to invest approximately $8.74 million of additional funds to wager on sports.  Gorodetsky used much of this money for purposes unrelated to sports wagering, including personal expenditures such as living expenses, travel and entertainment costs, and luxury automobiles and jewelry, the plea agreement states.  In all, Gorodetsky’s fraud scheme resulted in a loss to the individual of approximately $7.1 million.

The tax offense pertains to Gorodetsky’s failure to report the money he received from the individual as income on his tax returns, resulting in an approximate tax loss of more than $2.65 million.

Wire fraud is punishable by up to 20 years in prison, while the tax charge carries a maximum sentence of three years.  The Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

CHICAGO — A Grundy County businessman has been charged with fraud for allegedly orchestrating a Ponzi scheme that raised at least $75 million from more than 500 investors.

KENNETH D. COURTRIGHT owned and operated Today’s Growth Consultant Inc., a Minooka-based business that purported to build or acquire websites for investors.  TGC also did business through a division known as The Income Store, which had an office in Lancaster, Penn.  From at least January 2017 to October 2019, Courtright falsely promised to provide investors with a guaranteed income stream of up to 20% of their initial investment or 50% of the website revenues, whichever was higher, according to a criminal complaint filed in federal court in Chicago.  TGC backed these guarantees through fraudulent claims that the companies were financially healthy, the complaint states. 

In reality, the payment of returns to investors was primarily funded through a Ponzi scheme, with Courtright paying early investors with money raised from later investors, the charges allege.  Courtright also spent some of the investor funds to pay his mortgage and the school tuition of a family member, the complaint states.  By December 2019 the scheme had become unsustainable, and TGC notified investors of a “moratorium” on payments of returns purportedly due to unspecified “challenges and headwinds,” the complaint states.

The complaint charges Courtright, 49, of Minooka, with one count of wire fraud.  Courtright was arrested this morning and made an initial court appearance this afternoon before U.S. Magistrate Judge Jeffrey I. Cummings in Chicago.  Judge Cummings ordered Courtright released on bond.

The complaint was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The government is represented by Assistant U.S. Attorneys Jason Yonan and Saurish Appleby-Bhattacharjee.  The U.S. Securities and Exchange Commission provided valuable assistance.  The SEC previously filed a civil enforcement action and obtained a temporary restraining order and asset freeze against Courtright and TGC.

Wire fraud carries a maximum sentence of 20 years in prison.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.  The public is reminded that a criminal complaint is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

CHICAGO — Two former employees of the Chicago White Sox schemed with a ticket broker to fraudulently sell thousands of tickets to White Sox baseball games, according to an indictment returned in federal court in Chicago.

While working as ticket sellers for the White Sox, JAMES COSTELLO and WILLIAM O’NEIL fraudulently generated complimentary and discount game tickets without the team’s authorization and gave them to the broker, BRUCE LEE, in exchange for cash payments, the 14-count indictment states.  Lee, who owned the Chicago-based ticket brokerage Great Tickets, then sold the tickets on the online marketplace StubHub at prices below face value, the indictment states. 

During the 2016 to 2019 baseball seasons, Lee earned approximately $868,369 by selling approximately 34,876 tickets that he fraudulently obtained from Costello and O’Neil, the charges allege.  As a result of the scheme, the White Sox suffered a loss of approximately $1 million, the indictment states.

The indictment was returned Thursday in U.S. District Court in Chicago.  It charges Lee, 34, of Chicago, with eleven counts of wire fraud and two counts of money laundering, while Costello, 66, of New Lenox, is charged with one count of wire fraud, and O’Neil, 51, of New Lenox, is charged with one count of making a false statement to the FBI.  Arraignments have not yet been scheduled.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The government is represented by Assistant U.S. Attorney Matthew Schneider.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  Each count of wire fraud is punishable by up to 20 years in federal prison, while each money laundering count carries a maximum sentence of ten years.  The false statement charge is punishable by up to five years.  If convicted, the Court must impose reasonable sentences under federal statutes and the advisory U.S. Sentencing Guidelines.

ROCKFORD — Three Rockford-area residents were arrested today by federal and local law enforcement officers on drug-trafficking charges. 

ANTOWAN S. LAMBERT, also known as “Twan,” 42, of Rockton, and JESSE M. LEAVY, also known as “Lil Jesse” and “Lil Head,” 35, of Rockford, were arrested on charges of conspiracy to distribute cocaine and cocaine base, or “crack,” and multiple counts of distribution of cocaine or crack.  An indictment returned last week in federal court charged both men with a conspiracy to distribute cocaine and cocaine base from June through October 2019. In a separate but related case, SAMMY R. GORDON, JR., also known as “Sosa,” 31, of Rockford, was charged by federal criminal complaint with distributing fentanyl and heroin in Rockford. 

Law enforcement today also executed court-authorized search warrants at multiple locations in Rockford.  During the searches, authorities recovered ten handguns, approximately $30,000, more than 100 grams of crack, approximately 90 grams of heroin, and more than 4.5 kilograms of marijuana.

The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Robert J. Bell, Special Agent in Charge of the Chicago Office of the U.S. Drug Enforcement Administration; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives; Dan O’Shea, Rockford Police Chief; Gary Caruana, Winnebago County Sheriff; Brendan F. Kelly, Director of the Illinois State Police; and Kathy A. Enstrom, Special Agent-in-Charge of the Chicago Office of the IRS–Criminal Investigation Division.  The government is represented by Assistant U.S. Attorneys Talia Bucci and Vincenza Tomlinson.

Lambert, Leavy, and Gordon, Jr., appeared today before U.S. Magistrate Judge Lisa A. Jensen in federal court in Rockford.  They pleaded not guilty and will remain in custody pending detention hearings.  The detention hearings for Leavy and Gordon, Jr. are scheduled for Feb. 3, 2020, and for Lambert on Feb. 4, 2020.

The public is reminded that a complaint or an indictment contains only charges and is not evidence of guilt.  Each defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. Each count against Lambert and Leavy carries a maximum sentence of 20 years in prison.  The count against Gordon, Jr. carries a five-year mandatory minimum and a maximum of 40 years’ imprisonment.  If convicted, the Court must impose reasonable sentences under federal sentencing statutes and the advisory United States Sentencing Guidelines.

CHICAGO — Former Illinois State Sen. MARTIN A. SANDOVAL pleaded guilty today in federal court in Chicago to bribery and tax offenses included in an information filed in federal court Monday.

Sandoval, 56, of Chicago, pleaded guilty to one count of federal program bribery, which is punishable by a maximum sentence of ten years in federal prison, and one count of willfully filing a false income tax return, which is punishable by up to three years.  As part of a plea agreement, Sandoval has agreed to fully and truthfully cooperate in any matter in which he is called upon by the U.S. Attorney’s Office.  The government requested that Sandoval’s sentencing be delayed until his cooperation is complete.  U.S. District Judge Andrea R. Wood did not immediately set a sentencing date.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; and Andrea Kropf, Special Agent-in-Charge of the Department of Transportation-Office of Inspector General in Chicago.  The government is represented by Assistant U.S. Attorneys Christopher J. Stetler and James P. Durkin.

Sandoval admitted in the plea agreement that he solicited and accepted financial and other benefits from an individual affiliated with a Chicago-area red-light camera company, in return for Sandoval using his official position as a state senator to block legislation harmful to the red-light-camera industry.  Sandoval also admitted that he engaged in corrupt activities with other public officials and accepted money from other individuals in return for using his official position to attempt to benefit those individuals and their business interests.  Sandoval admitted accepting more than $250,000 in bribes as part of criminal activity that involved more than five participants.

In addition to the bribery, Sandoval admitted that he willfully caused his accountant to file income tax returns that Sandoval knew underreported his income for the calendar years 2012 through 2017.  Sandoval admitted in the plea agreement that his tax offenses caused a total loss to the IRS of at least $72,441, and a loss to the Illinois Department of Revenue of at least $13,384.38, which he has agreed to pay.

CHICAGO — A Streamwood man was sentenced today to nearly seven years in federal prison for enticing a 16-year-old boy to produce sexually explicit videos of himself.

MICHAEL LIEDTKE, 35, pleaded guilty last year to one count of receipt of child pornography.  U.S. District Judge Elaine E. Bucklo imposed a sentence of six years and eleven months in federal prison.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Douglas S. Beidler, Acting Deputy Special Agent-in-Charge of the Chicago office of the FBI; and Robert Berlin, DuPage County State’s Attorney.  The Carol Stream Police Department provided valuable assistance.  The government was represented by Assistant U.S. Attorneys Abigail Peluso and Matthew McCrobie.

Liedtke admitted in a plea agreement that in December 2016 he enticed the 16-year-old boy to create two sexually explicit videos and send them to Liedtke via cellphone.  During a court-authorized search of Liedtke’s home last year, law enforcement discovered an external disk drive that contained 29 images and six videos of children engaged in sexually explicit conduct.  Each of the children depicted in the images and videos was identified as a known child victim by the National Center for Missing and Exploited Children. 

Liedtke also admitted in the plea agreement that in January 2019 he possessed and operated a video camera that he intentionally hid in the ceiling of a public restroom at the DuPage County Training Academy in Carol Stream.  Recordings from the camera depicted the unclothed body parts of approximately 400 people using the restroom, including approximately 300 children under the age of 18.  Liedtke acknowledged in the plea agreement that he placed the video camera in the restroom to obtain the images.

After Liedtke pleaded guilty in federal court, the DuPage County State’s Attorney’s Office moved to dismiss the parallel state criminal charges filed against Liedtke.

“My office will continue to prosecute and hold accountable those individuals who prey upon our youth,” said U.S. Attorney Lausch.  “We appreciate the outstanding work of our colleagues at the DuPage County State’s Attorney’s Office, as well as our federal, state, and local law enforcement partners, who worked together to bring justice on behalf of the victims in this case.”

“Thanks to the coordinated efforts of law enforcement and prosecutorial partners at all levels, Mr. Liedtke will be held accountable for victimizing hundreds of our community’s most vulnerable citizens,” said FBI Acting Deputy SAC Beidler.  “The FBI will always strive to safeguard our youth from those who seek to exploit them.”

“I would like to thank the U.S. Attorney’s Office for their work in removing this sexual predator from society,” DuPage County State’s Attorney Berlin said.  “Mr. Liedtke’s deviant actions demonstrate his complete disregard for others and society as a whole.  While this has been a very disturbing case, Mr. Liedtke’s guilty plea and nearly seven-year sentence underscores the close partnership shared by local and federal authorities working together to keep our communities safe.”

If you believe you are a victim of sexual exploitation, you are encouraged to contact the National Center for Missing and Exploited Children by logging on to www.missingkids.com/home or by calling 1-800-843-5678.  The service is available 24 hours a day, seven days a week.

CHICAGO — A former Rosemont resident has been indicted on federal child pornography charges for allegedly exploiting a minor to produce sexually explicit images.

MARCOS GERMAN MENDEZ, 32, is charged with two counts of using a minor to produce child pornography, one count of transporting child pornography, and one count of possession of child pornography on his cell phone.

The indictment was returned in 2016 in U.S. District Court in Chicago.  Mendez was arrested in July of last year in León, Guanajuato, Mexico, and recently extradited to Chicago.  He made an initial court appearance here on Thursday before U.S. Magistrate Judge Jeffrey I. Cummings.  Mendez pleaded not guilty to the charges and will remain in custody pending a detention hearing on Feb. 3, 2020, at 2:00 p.m.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and James M. Gibbons, Special Agent-in-Charge of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Chicago.  Substantial assistance was provided by the U.S. Postal Inspection Service, U.S. Customs and Border Protection, Cook County Sheriff’s Office, and U.S. Marshals Service.  The government is represented by Assistant U.S. Attorney Misty N. Wright.             

The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

If you believe you are a victim of sexual exploitation, you are encouraged to contact the National Center for Missing and Exploited Children by logging on to www.missingkids.com/home or by calling 1-800-843-5678.  The service is available 24 hours a day, seven days a week.

CHICAGO — A Chicago investment manager has been indicted for allegedly swindling money from women he met through online dating services.

MARCUS BEAM, who owned and controlled various companies in Chicago and the suburbs, exaggerated his financial success and the expected return on investments to fraudulently obtain money from women he met online and other investors, including a family member and a former employee, according to an indictment returned Thursday in U.S. District Court in Chicago.  Beam falsely claimed that their funds would be invested in popular stocks such as Uber and Lyft, and other investment products such as gold, art, and real estate, the indictment states.  In reality, Beam spent the money for his own personal benefit, including rent, auto loans, and purchases at retail stores such as Walmart and Ikea, the indictment states.  The fraud scheme began in 2015 and continued until October of last year, resulting in a loss to investors of at least $500,000, the indictment states.

The indictment charges Beam, 49, of Woodridge, with nine counts of wire fraud and one count of mail fraud.  Arraignment in federal court has not yet been scheduled.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Craig Goldberg, Inspector-in-Charge of the U.S. Postal Inspection Service in Chicago; Jeffrey A. Monhart, Regional Director of the Chicago Regional Office of the U.S. Department of Labor, Employee Benefits Security Administration; and Tanya Solov, Director of the Illinois Securities Department of the Illinois Secretary of State.  The government is represented by Assistant U.S. Attorney Jacqueline Stern.

Valuable assistance has been provided by the U.S. Securities and Exchange Commission, which previously filed a civil complaint against Beam.

According to the indictment, Beam held himself out as the owner of a Chicago investment company called Chase Private Equity LLC, which was also known as New World Capital LLC.  Beam also owned and operated other companies, including a Naperville-based virtual reality company called VR 360 LLC, and Imex Energy Inc., a Bolingbrook-based brokerage firm that claimed to sell retail electricity for third parties, the indictment states.

The charges allege that Beam attempted to conceal his fraud scheme by furnishing victims with account statements that misrepresented the value of their funds.  Beam also made false lulling statements to investors for why their money could not be paid back as requested, the indictment states.  Some of the money allegedly misappropriated by Beam came from investors’ retirement accounts.

Each count in the indictment is punishable by up to 20 years in prison.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.  The public is reminded that an indictment is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

ROCKFORD — A suburban Chicago man was sentenced Monday in federal court before U.S. District Judge Matthew F. Kennelly to eight years in prison for stealing firearms from a licensed firearms dealer and conspiring to steal firearms from licensed firearm dealers. 

KELVIN CULPS, also known as “Forty,” 23, of Dolton, was sentenced in two separate but related cases after pleading guilty on Sept. 17, 2019.

With respect to the first case, Culps admitted that in the early hours of April 18, 2017, he and codefendant BRUCE WALKER, 24, of Calumet City, and another individual obtained a stolen vehicle and drove from Cook County to a federally-licensed firearms dealer in Manteno.  The three individuals used a hammer to shatter one of the business’s glass exterior doors and entered the premises.  After entering, they attempted to break into a firearms safe inside the gun store, but were unsuccessful.  Culps, however, stole a rifle with a 30-round magazine from the office of the gun store.  Culps, Walker, and the other individual also stole boxes of ammunition before returning to Cook County with the stolen rifle and ammunition.  About three hours later, Culps, Walker, and the other individual used the same stolen vehicle to drive to a federally-licensed firearms dealer in Tinley Park. There they attempted to shatter the front glass door and front window of the gun store, but fled after failing to do so.

With respect to the second case in which Culps was sentenced, Culps and his codefendant in that case, PARIS L. BROWN, also known as “Pairo,” 24, of Chicago, admitted that they drove in a stolen vehicle from Cook County to a licensed firearms dealer in Loves Park.  Culps used a hammer to break through the glass exterior door, and Culps and Brown stole 12 handguns and rifles from the store.  Culps and Brown concealed the stolen firearms in the trunk of the stolen vehicle and drove back to Cook County, where they intended to sell and distribute the stolen firearms. 

The sentencing for Culps was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, and Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives.  The Police Departments of Loves Park, Manteno, Chicago, Tinley Park, and Lombard assisted in the investigation, as did the Winnebago County Sheriff’s Office.  The government was represented by Assistant U.S. Attorney Talia Bucci.

Walker pleaded guilty on Feb. 20, 2019, to one count of conspiring to steal a firearm from a licensed firearms dealer and one count of possessing a stolen firearm.  Walker was sentenced on May 30, 2019, to seven years and eight months in prison. 

Brown pleaded guilty on Jan. 9, 2019, to stealing firearms from a licensed firearms dealer and conspiring to do so.  Brown was sentenced on June 28, 2019, to six years in prison.

As part of their sentences, Culps, Brown, and Walker were also ordered to pay restitution to the gun stores that they burglarized.

CHICAGO — A Chicago man who was recently released from federal prison has been arrested for allegedly stalking and harassing his probation officer.

ISAAC MYLES, 50, was arrested Friday on a federal complaint charging him with cyberstalking.  A detention hearing is scheduled for today before U.S. Magistrate Judge Jeffrey Cole in Chicago.

The charge was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jason R. Wojdylo, acting Chief Deputy U.S. Marshal for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The government is represented by Assistant U.S. Attorney Michael J. Kelly.

Myles has been on supervised release since July 2018 after completing a federal prison sentence.  An officer from the U.S. Probation Department was assigned to meet with Myles at his home or workplace and monitor his compliance with court-ordered conditions of release. 

According to the complaint, Myles partially exposed his genitals to the officer during an official visit to Myles’s home in September 2018.  The Probation Department then reassigned supervision of Myles to a different probation officer.  More recently, Myles repeatedly called the initial officer, leaving sexually explicit voicemails on her phone and referring to the officer in obscene and degrading terms, the complaint states.  From Dec. 1, 2019, to Jan. 2, 2020, approximately 29 calls were placed from Myles’s phone to the officer’s phone, according to the complaint.

The public is reminded that a complaint is not evidence of guilt.  The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  Cyberstalking is punishable by up to five years in prison.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

CHICAGO — A Chicago man has been sentenced to ten years in federal prison for exploiting several young men and a woman in a national sex trafficking operation.

TIMOTHY DORSEY facilitated the prostitution of his victims in the Chicago area and throughout the country, including Arizona, California, Colorado, Georgia, Michigan, Missouri, Nevada and Texas.  Dorsey sought customers for his victims through online advertisements that offered erotic massage services but contained code words to convey that sex acts would be included.  He booked and funded his workers’ travel expenses to meet with individuals who responded to the ads, and he collected at least half of the illicit proceeds.  Dorsey threatened to assault or kill anyone who left his sex trafficking operation.

Dorsey, 52, pleaded guilty last year to two counts of transporting an individual in interstate commerce to engage in prostitution.  U.S. District Judge John J. Tharp., Jr., on Tuesday imposed the ten-year prison sentence.  In determining the sentence, Judge Tharp found that the government demonstrated that Dorsey directed one his workers to murder a man who had left Dorsey’s organization to work on his own.  The man was shot multiple times outside of a motel in Schiller Park on Feb. 27, 2015.  The individual who fired the shots was convicted of murder in the Circuit Court of Cook County and sentenced to 50 years in prison.

Dorsey's sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The U.S. Attorney’s Office for the Middle District of Georgia and the Schiller Park Police Department provided valuable assistance.

“Timothy Dorsey recruited young men and women who were struggling with emotional and substance abuse issues into his national prostitution operation,” Assistant U.S. Attorneys Jared C. Jodrey and Maureen E. Merin argued in the government’s sentencing memorandum.  “He preyed on young people with troubled family situations, mental health and drug abuse issues, and he emotionally and physically abused them while they were involved in his organization.”

If you believe you are a victim of sexual exploitation, you are encouraged to call the National Center for Missing and Exploited Children at 1-800-843-5678, or log on to http://www.missingkids.com.  The service is available 24 hours a day, seven days a week.

ROCKFORD — A Machesney Park man pleaded guilty today before U.S. District Judge John J. Tharp, Jr., to one count of armed robbery, one count of robbery, and one count of using and carrying a firearm during a crime of violence. 

DAVID M. BANEY, 34, admitted in a written plea agreement that on Jan. 11, 2018, he walked into Chase Bank, 7997 N. Alpine Rd. in Loves Park, wearing a mask.  Baney approached a teller who was behind the teller stations and demanded money from two tellers.  During the robbery, Baney carried a gun and pointed it at a bank employee and a bank customer.  Baney obtained $24,402 from Chase Bank during the robbery. 

Baney also admitted that on the same day he possessed an object that appeared to be a firearm when he entered Kelley’s Market/Mobil gas station, 8200 N. Second St. in Machesney Park, and ordered an employee to give him cash from the registers and safe.  The employee handed Baney $170 in cash but could not access the safe, and Baney left the store with the money.

Sentencing is set for April 6, 2020, at 10:00 a.m. Baney faces a maximum sentence of 20 years in prison on each of the robbery charges, and a maximum of life in prison - with a statutory minimum of seven years - for the firearm charge, which must be consecutive to any other sentence imposed.  Each charge also carries a fine of up to $250,000, and restitution.  The actual sentence will be determined by the U.S. District Court, guided by the Sentencing Guidelines.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI; Gary Caruana, Winnebago County Sheriff; Dan O’Shea, Chief of the Rockford Police Department; and Chuck Lynde, Chief of the Loves Park Police Department. The government is represented by Assistant U.S. Attorney Michael D. Love.

The investigation was conducted by the FBI-led Rockford Area Violent Gang Task Force, consisting of law enforcement officers and agents from the FBI, Rockford Police Department, Loves Park Police Department, and Freeport Police Department.  Officers from the Winnebago County Sheriff’s Department participated in the investigation.

CHICAGO — A suburban drug dealer has been sentenced to 12 years in federal prison for illegally possessing narcotics and a loaded semiautomatic handgun.

EFREN GUTIERREZ, 44, illegally possessed the firearm and narcotics on Dec. 6, 2017.  Law enforcement executed a court-authorized search of Gutierrez’s home in Burbank and discovered the gun hidden in a diaper bag in his bedroom.  The gun was loaded and had a .45-caliber magazine attached to it.  Gutierrez had previously been convicted of multiple felonies in state court, including drug and gun offenses, and was not legally allowed to possess a firearm.  He admitted in a plea agreement that he kept the gun and ammunition to protect his drug distribution business.  During the search of Gutierrez’s home, law enforcement discovered distribution quantities of cocaine, marijuana, and 98% pure methamphetamine.

Gutierrez pleaded guilty earlier this year to federal drug and firearm charges.  U.S. District Judge Virginia M. Kendall imposed the 12-year sentence Monday in federal court in Chicago.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Charlie Beck, interim Superintendent of the Chicago Police Department.

“Over the past few years, the Chicagoland area has been subjected to devastating firearm violence,” Assistant U.S. Attorney Cornelius A. Vandenberg argued in the government’s sentencing memorandum.  “The sale of narcotics and the possession of firearms by felons is behavior that will not be tolerated by the federal government.”

Holding convicted felons accountable through federal prosecution is a centerpiece of Project Guardian and Project Safe Neighborhoods (PSN) – the Department of Justice’s violent crime reduction strategies.  Project Guardian focuses specifically on investigating, prosecuting, and preventing gun crimes, and it emphasizes the importance of using modern technologies to promote gun crime intelligence.  In the Northern District of Illinois, U.S. Attorney Lausch and law enforcement partners have deployed the Guardian and PSN programs to attack a broad range of violent crime issues facing the district, including by prosecuting individuals who illegally possess firearms.

CHICAGO — A Connecticut investment manager has been sentenced to more than seven years in federal prison for operating a multi-million dollar fraud scheme that swindled his friends and family members, including victims in the Chicago area.

ALVIN WILKINSON, the founder of Chicago Index Partners LP and Wilkinson Financial Opportunity Fund LP, both based in Sharon, Conn., persuaded at least 30 individuals, many of whom were his friends, family members and colleagues, to invest approximately $13.5 million in his funds.  Wilkinson, who previously served as a director at the Chicago Board Options Exchange, claimed he would trade a portfolio of financial instruments on their behalf, including options and futures, and that his trading strategy made money regardless of market conditions. 

In reality, Wilkinson did not maintain trading accounts for the funds, and he did not use investor funds to trade in options and futures.  Wilkinson often used investor funds to cover personal expenses, and he later used the money to pay earlier investors through Ponzi-type payments.  His fraud scheme began no later than 1999 and continued until 2016.

Wilkinson, 61, of Sharon, Conn., pleaded guilty earlier this year to one count of wire fraud.  U.S. District Judge Sharon Johnson Coleman on Thursday sentenced Wilkinson to seven years and four months in prison and ordered him to pay $8.032 million in restitution to the victims.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The Commodity Futures Trading Commission, which filed a civil enforcement lawsuit against Wilkinson, provided valuable assistance.

“Defendant was a fiduciary who was supposed to act in investors’ best interest at all times,” Assistant U.S. Attorney Nicholas J. Eichenseer argued in the government’s sentencing memorandum.  “While defendant reassured investors with lie after lie, he was living lavishly courtesy of the millions he was secretly diverting to himself.”

ROCKFORD — Two Freeport men were sentenced today in federal court in Rockford on drug trafficking charges. 

TERRANCE YOUNG, 46, was sentenced by U.S. District Chief Judge Rebecca R. Pallmeyer to seven and a half years in federal prison.  Young pleaded guilty on Sept. 13, 2019, to possessing cocaine with intent to distribute.  In a written plea agreement, Young admitted that on Aug. 30, 2018, law enforcement officers executed a search warrant at Young’s home.  During the search, officers located and seized approximately 5.5 grams of cocaine in a plastic bag inside a kitchen cupboard, as well as other drug paraphernalia.  Young acknowledged that the cocaine in the cupboard belonged to him and that he possessed it with the intent to distribute to others.  In a dining room adjacent to the kitchen, officers located $3,743 in cash.  Young also acknowledged that the cash belonged to him and that it came from the proceeds of drug sales.  Young further admitted that he sold cocaine on July 14, 2017, Aug. 15, 2017, Dec. 4, 2017, and Aug. 7, 2018.

In a separate but related case, KYRAN WILLIAMS, 25, was sentenced by U.S. District Judge Philip G. Reinhard to nine years and three months in federal prison.  Williams pleaded guilty on Sept. 17, 2019, to possessing crack cocaine with intent to distribute, possessing a firearm in furtherance of a drug trafficking crime, and illegally possessing a firearm as a felon.  In a written plea agreement, Williams admitted that on Aug. 30, 2018, law enforcement officers executed a search warrant at Williams’s home in Freeport.  Officers found and seized two guns, one with an extended magazine containing 31 rounds and the other with an obliterated serial number, as well as ammunition, a plastic baggie containing crack cocaine, and other drug paraphernalia.  Williams also admitted he illegally possessed the firearms as a convicted felon and that he possessed the guns and ammunition found during the search to protect his drug stash and himself during his drug trafficking activity.  Williams also admitted that he engaged in drug transactions and sold heroin on April 11, 2017, May 31, 2017, and April 11, 2018, and that he sold a substance containing both heroin and fentanyl on June 13, 2018.

The sentencings were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; Brendan F. Kelly, Director of the Illinois State Police; and Matt Summers, Freeport Police Chief.  The investigation was conducted by the Rockford Area Violent Gang Task Force, the Stateline Area Narcotics Team (“SLANT”), and the Freeport Police Department.  The Rockford Area Violent Gang Task Force is led by the FBI and includes members of the FBI and the Rockford, Loves Park, and Freeport police departments.  SLANT is a task force led by the Illinois State Police.  The government is represented by Assistant U.S. Attorney Margaret J. Schneider.

CHICAGO — A convicted felon from Chicago has been found guilty of illegally possessing a loaded handgun with an extended magazine and obstructing justice for offering to pay witnesses to lie on his behalf.

RAMONE SHAFFERS illegally possessed the gun on Oct. 16, 2016, in a parked car in the Woodlawn neighborhood on the South Side of Chicago.  Shaffers had previously been convicted of a felony and was not legally allowed to possess a firearm. 

Three passengers were in the vehicle at the time of Shaffers’s illegal possession.  After Shaffers was arrested, he directed another individual to offer payment to the passengers in exchange for giving false testimony.

A federal jury in Chicago on Thursday convicted Shaffers, 37, of Chicago, on one count of illegal possession of a firearm by a felon, and one count of obstruction of justice.  Each count is punishable by up to ten years in federal prison.  U.S. District Judge John J. Tharp, Jr., set sentencing for April 14, 2020.

The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives; and Charlie Beck, interim Superintendent of the Chicago Police Department.  The government is represented by Assistant U.S. Attorneys Albert Berry III and Kavitha J. Babu.

According to evidence presented at the four-day trial in federal court, Shaffers and the three others were inside a vehicle parked near 62nd Street and Cottage Grove Avenue.  Chicago Police officers pulled behind the car and smelled burnt cannabis and heard loud music.  Shaffers, who was sitting in the driver’s seat, stepped out of the vehicle and ran away.  He was apprehended at a later time.

While in custody awaiting trial, Shaffers placed a call from jail to the individual whom he hoped would pay off the passengers in the car in exchange for their false testimony.  In one of the calls, which was surreptitiously recorded by law enforcement, Shaffers explained what the witnesses should say on his behalf: “Everybody could say he didn’t have nothing.  He was there, but he ain’t have nothing.”  Shaffers later described what he hoped would happen to his federal indictment as a result of the false testimony: “They gonna throw that [expletive] right out.  Motion out.  Everything is thrown out.”

Holding convicted felons accountable through federal prosecution is a centerpiece of Project Safe Neighborhoods – the Department of Justice’s violent crime reduction strategy.  In the Northern District of Illinois, U.S. Attorney Lausch and law enforcement partners have deployed the PSN program to attack a broad range of violent crime issues facing the district, including by prosecuting individuals who illegally possess firearms.  The U.S. Attorney’s Office also participates in Project Guardian, an initiative from the Department of Justice that serves as a complementary effort to PSN.  Project Guardian focuses specifically on investigating, prosecuting, and preventing gun crimes, and it emphasizes the importance of using modern technologies to promote gun crime intelligence.

CHICAGO — A husband and wife have been sentenced to federal prison for stealing the identities of at least ten people and using the information to file fraudulent tax returns seeking more than $1.3 million in refunds.

TILLMAN LIGGINS III, 50, of Joliet, was sentenced Tuesday to five years and four months in prison.  His wife, CHINITA WILLIAMS-LIGGINS, 39, of Joliet, was sentenced in July to three and a half years in prison.  The couple was also ordered to pay $331,154 in restitution to the IRS. 

U.S. District Judge Robert W. Gettleman imposed the sentences in federal court in Chicago.

The sentences were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.

“Without the compliance of taxpayers with our country’s tax laws, the federal government would essentially cease to function,” Assistant U.S. Attorney Kalia Coleman argued in the government’s sentencing memorandums.  “The honest taxpayers must shoulder a disproportionate amount of the tax burden, and fewer necessary government services and benefits can be provided when some people cheat the IRS out of substantial sums of money.”

Liggins III and Williams-Liggins each pleaded guilty earlier this year to one count of wire fraud and one count of aggravated identity theft.  The couple admitted in plea agreements that they obtained personal identifying information, including names, Social Security numbers, and dates of birth, of at least ten individuals without their knowledge or consent.  They used that information to prepare and file false and fraudulent individual federal income tax returns (Forms 1040) for the tax years 2011, 2012, 2013, and 2014.

In total, the pair caused to be filed with the IRS at least 219 false and fraudulent tax returns seeking refunds of approximately $1,323,793.  As a result of the scheme, the IRS deposited approximately $331,154 in fraudulent refunds into bank accounts controlled by the couple and others.

WASHINGTON – The Department of Justice on Tuesday filed a complaint in the United States District Court for the Northern District of Illinois on behalf of Captain and Judge Advocate Derrick Strong against the City of Chicago Fire Department (CFD), alleging that the City violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) when it failed to provide Strong with an opportunity, after his return from active duty military service, to take a promotional examination that he missed while deployed.

“The men and women of our Armed Forces make personal sacrifices to protect our nation, and they have rights that must be respected,” said John R. Lausch, Jr., United States Attorney for the Northern District of Illinois. “The Department of Justice will not falter in protecting the rights of those who selflessly serve our country.”   

“Beginning with the American Revolution and every day since the Revolution, American patriots risked their lives to establish and defend our nation by serving in the United States armed forces.  The United States has an obligation to ensure that employers do not penalize our servicemembers for performing their  military duty,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “Generations of Americans owe a debt of gratitude to our soldiers, sailors, and other servicemembers, and the United States Department of Justice remains committed to robust enforcement of civil rights protections for these brave women and men.”

According to the complaint, Strong is currently assigned to the 416th Theater Engineer Command’s (TEC), Office of the Staff Judge Advocate as a Trial Counsel and Administrative Law Attorney, where he provides legal advice and overall legal support to the 416th TEC and its Command. He is also employed as a Cross-Trained Firefighter and Emergency Medical Technician-Basic (Firefighter/EMT) for the Chicago Fire Department. Mr. Strong is currently assigned to Squad 5, which is a Special Operations Heavy Rescue unit. From Sept. 30, 2016, to June 26, 2017, he was actively deployed with the U.S. Army Reserve in support of Operation Enduring Freedom. While Strong was deployed, the City of Chicago administered a test for firefighters to become fire engineers.  He alleges, as outlined in the complaint filed in federal court, that the CFD violated USERRA by failing to provide him with an opportunity to take a Fire Engineer promotional examination following his return to work upon his honorable discharge from active duty military service.

The Justice Department gives high priority to the enforcement of servicemembers’ rights under USERRA. This lawsuit stems from a referral to the United States Department of Justice from the United States Department of Labor, after an investigation by the Department of Labor’s Veterans’ Employment and Training Service.  Additional information about USERRA can be found on the Justice Department’s websites here and here, as well as on the Department of Labor’s website here.

ROCKFORD — A Rockford man was sentenced today in federal court by U.S. District Judge Philip G. Reinhard to 15 months in prison for aiming the beam of a laser pointer at an aircraft. 

BRENTON WELLS, 45, admitted in a written plea agreement that on Dec. 6, 2018, while standing in the backyard of a residence in Rockford, he knowingly aimed his laser pointer at an aircraft flying over the residence. Wells also admitted that he continued to aim his laser pointer at the aircraft for a period of time even as the aircraft moved through the sky over the residence. Wells pleaded guilty to the charge on Aug. 20, 2019.

The sentencing was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; Dan O’Shea, Rockford Chief of Police; and on behalf of the Department of Homeland Security: Marc Sledge, Director of Air and Marine Operations, Great Lakes Air and Marine Branch, and James Gibbons, Special Agent-in-Charge of the Chicago Field Office of Homeland Security Investigations.  The government was represented by Assistant U.S. Attorney Scott R. Paccagnini.

ROCKFORD — A former Loves Park woman pleaded guilty today before U.S. District Judge Philip G. Reinhard to wire fraud. 

MICHELLE L. McKINNEY, 43, admitted in a written plea agreement that between June 2013 and September 2016, while employed as an account manager by a roofing company that operated a cloud-based construction management program, she schemed to defraud her employer and obtain money and property by fraudulent representations and concealment of material facts. 

McKinney faces a maximum sentence of 20 years’ imprisonment and a fine of up to $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greater.  Sentencing is set for May 11, 2020, at 9:00 a.m. 

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI.  The government is represented by Assistant U.S. Attorney Scott R. Paccagnini.

As an account manager, McKinney was responsible for the oversight of the company’s payroll, human resources, accounts payable, and accounts receivable.  From 2013 through March 2014 the company was located in Rockton, and from then through 2016 the company was located in Beloit, Wisc.  Some of the company’s employees, including McKinney, were issued a corporate credit card.  Without the company’s knowledge, McKinney also had another corporate credit card issued.  McKinney also had access to the company’s bank account and accompanying debit card.  As stated in the plea agreement, McKinney authorized monthly funds transfers from the company to pay the entire balance of all of the company’s credit cards.  McKinney used the credit cards and debit card to make unauthorized purchases for her own benefit totaling $475,775.84.  In order to conceal her unauthorized purchases, McKinney disguised her unauthorized charges in the company’s accounting system as company expenses such as office supplies or fees.  McKinney also created fictitious payroll invoices in the amount of her unauthorized purchases.  To conceal the true nature of the transactions, she entered her personal transactions in bulk into the company’s accounting system instead of line-by-line.

ROCKFORD — A South Beloit man pleaded guilty today before U.S. District Judge Matthew F. Kennelly to charges of producing child pornography. 

ADRIAN C. PETERS, 26, admitted in a written plea agreement that from October 2012 to December 2014 he enticed seven minor victims - ages 14 to 17 - to engage in sexually explicit conduct for the purpose of producing a recording of such conduct on computers.  Peters then transmitted some of the videos via the internet.  The minor victims were from Illinois, Wisconsin, and Arizona.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago Office of the FBI.  The Winnebago County Sheriff’s Office and the South Beloit Police Department assisted in the investigation.  The government is represented by Assistant U.S. Attorney Michael D. Love.

Each count of producing child pornography carries a mandatory minimum sentence of 15 years in prison and a maximum sentence of 30 years.  Sentencing is set for April 17, 2020, at 9:30 a.m.

CHICAGO — A former associate clerk in the Office of the Clerk of the Circuit Court of Cook County was sentenced today to two years in prison for lying under oath to a federal grand jury.

BEENA PATEL, 58, of Chicago, was convicted earlier this year of making false declarations before a grand jury.  The grand jury was conducting an investigation of possible criminal violations in connection with the purchasing of jobs and promotions in the Clerk’s office.

U.S. District Judge Sara L. Ellis imposed the two-year sentence after a hearing in federal court in Chicago.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Patrick M. Blanchard, Cook County Inspector General; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI. 

“Defendant not only had answers to the questions the grand jury was asking, but had information that went to the very heart of its investigation,” Assistant U.S. Attorneys Heather McShain and Ankur Srivastava argued in the government’s sentencing memorandum.  “Witnesses who lie during the course of a grand jury investigation not only violate their solemn oath to tell the truth, but also impede the grand jury’s ability to gather evidence.”

According to evidence at trial, the grand jury was conducting an investigation of possible criminal violations in connection with the purchasing of jobs and promotions in the Clerk’s office.  Patel sold campaign fundraiser tickets on behalf of the Clerk to colleagues in the office and knew that other employees did the same.  Yet when asked about it during grand jury testimony on Oct. 15, 2015, Patel denied selling the tickets to employees and denied knowing that other employees had done the same.  The jury at trial found that Patel’s statements were false. 

Evidence further revealed that Patel provided false statements to the grand jury about two other matters.  Patel lied when she denied having recent conversations with another Clerk’s Office employee who had previously loaned $15,000 to a company associated with the Clerk and her husband.  Patel also falsely denied contacting the Clerk’s Chief of Staff regarding a promotion opportunity for a Clerk’s Office employee whose brother had previously donated $10,000 to the Clerk’s campaign.

CHICAGO — A convicted felon has been sentenced to nearly seven years in federal prison for illegally possessing a loaded handgun and 61 rounds of ammunition in the South Shore neighborhood of Chicago.

ANTONIO BROWN, 25, of Chicago, illegally possessed the gun and two extended-capacity magazines in the 7500 block of South Dante Avenue on Sept. 22, 2018.  Brown was in the front passenger seat of a stolen vehicle that had been pulled over by officers from the Chicago Police Department.  He initially tried to hide the gun and ammunition under his seat to avoid detection, but the officers discovered the items during an ensuing search of the vehicle.

Brown was not legally allowed to possess a firearm after previously being convicted in state court of the attempted armed robbery of a nail salon.  He was released from state prison seven months before the traffic stop.

Brown pleaded guilty earlier this year to one count of illegal possession of a firearm by a felon.  U.S. District Judge Ronald A. Guzman imposed the 82-month sentence Thursday in federal court in Chicago.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; and Charlie Beck, interim Superintendent of the Chicago Police Department.

“In a city plagued by traumatic injuries and death from bullets being indiscriminately sprayed on the street, the public is truly fortunate that CPD was able to interdict defendant and seize his arsenal before any harm could come to anyone,” Assistant U.S. Attorney Devlin N. Su argued in the government’s sentencing memorandum.  “By illegally packing a devastating amount of firepower, defendant dramatically increased the risk of violence to the community.”

According to evidence and arguments presented to the Court during the federal case, Brown has appeared in several music videos and photographs posted on YouTube or Facebook holding handguns equipped with laser sights and extended-capacity magazines similar to the type he possessed during the traffic stop.  Brown is frequently seen in the videos and photos aiming the guns directly at the camera.

Holding convicted felons accountable through federal prosecution is a centerpiece of Project Safe Neighborhoods – the Department of Justice’s violent crime reduction strategy.  In the Northern District of Illinois, U.S. Attorney Lausch and law enforcement partners have deployed the PSN program to attack a broad range of violent crime issues facing the district, including by prosecuting individuals who illegally possess firearms.  The U.S. Attorney’s Office also participates in Project Guardian, an initiative from the Department of Justice that serves as a complementary effort to the success of PSN.  Project Guardian focuses specifically on investigating, prosecuting, and preventing gun crimes, and it emphasizes the importance of using modern technologies to promote gun crime intelligence.

CHICAGO — A federal judge today sentenced a Chicago man to more than 16 years in prison for shooting an agent from the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives.

ERNESTO GODINEZ shot the agent on May 4, 2018, in the Back of the Yards neighborhood of Chicago.  At the time of the early morning shooting, the agent and several law enforcement officers were conducting a covert investigation in the 4300 block of South Hermitage Avenue.  The agent was wounded in the head but survived.

A federal jury earlier this year convicted Godinez, 29, of both counts against him, including one count of assault of a federal officer, and one count of discharging a firearm during a crime of violence.  U.S. District Judge Harry D. Leinenweber imposed a sentence of 16 years and eight months in prison.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois, and Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of ATF.  Substantial assistance was provided by the Chicago Police Department, FBI, U.S. Marshals Service, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, U.S. Drug Enforcement Administration, and Illinois State Police.

“The depravity of the defendant’s crime is remarkable,” Assistant U.S. Attorneys Kavitha J. Babu and Nicholas J. Eichenseer argued in the government’s sentencing memorandum.  “This was indiscriminate, deadly violence by a recidivist shooter.  It is critical that assaults on law enforcement be met with serious punishment.”

“The primary goal of our violent crime prosecutions is to ensure public safety,” said U.S. Attorney Lausch.  “To that end, we will continue to aggressively prosecute repeat violent offenders like Defendant Godinez in order to hold them accountable for their reprehensible conduct and to deter others from committing similar crimes.  I commend the AUSAs, agents, and officers involved in this case for their outstanding work to seek justice.  Our office will continue to use every available federal law enforcement tool to investigate, prosecute, and seek stiff prison sentences for those offenders who illegally use, possess, or transfer firearms.”

“This experience emboldens us to continue in our efforts to reduce gun violence in the city of Chicago,” said ATF SAC Jones.  “We stand together with the families of all victims of violence in our city as they seek the closure we found today.  We commit all of ATF’s resources to investigate violent crimes in partnership with the Chicago Police Department to ensure that offenders are prosecuted to the fullest extent of the law.”

CHICAGO — A suburban Chicago man was sentenced today to a year and a half in federal prison for conspiring to straw purchase handguns on behalf of a woman who allegedly tried to smuggle the firearms into Egypt.

OMRAN ISMAIL purchased four handguns in November 2013 from a licensed firearms dealer in Tinley Park, and then immediately transferred the guns to co-defendant OLA SAYED so that Sayed could bring them to Egypt.  The guns were discovered in Sayed’s checked luggage at O’Hare International Airport in Chicago as she attempted to board a flight to Cairo, via London. 

A federal jury in Chicago earlier this year convicted Ismail, 53, of Burbank, of both firearm counts against him.  U.S. District Judge Sara L. Ellis imposed the 18-month sentence after a hearing in federal court.

Sayed, of Palos Park, was charged in the conspiracy but fled and is considered a fugitive.

Ismail’s sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and James M. Gibbons, Special Agent-in-Charge of the Chicago office of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.  Valuable assistance was provided by the Chicago Police Department and U.S. Customs and Border Protection.

“Unlawfully purchasing and transferring firearms is an incredibly serious offense,” Assistant U.S. Attorneys Abigail L. Peluso and Katie M. Durick argued in the government’s sentencing memorandum.  “Ismail’s conduct was deliberate and reckless, and it could have resulted in additional unlawful activity had the guns been successfully smuggled to Egypt.”

According to evidence presented at Ismail’s trial, Ismail purchased four 9mm firearms from the dealer on Nov. 18, 2013.  When he purchased the firearms, Ismail completed a federal form falsely certifying that he was the actual buyer.  Ismail picked up the guns from the dealer five days later, at which time he confirmed that all of his answers on the form were “still true, correct, and complete.”  Ismail then immediately transferred all four firearms to Sayed, so that Sayed could take the firearms with her to Egypt.

Sayed purchased two other 9mm firearms, and then took all six guns with her to O’Hare Airport on Dec. 23, 2013, according to the charges pending against her.  Authorities at the airport discovered the guns in Sayed’s checked luggage as she waited to board her flight, the charges against Sayed allege.

ROCKFORD — A Carpentersville man pleaded guilty today in federal court before U.S. District Judge Sara L. Ellis to mail fraud. 

ROBERTO FISHER, 50, admitted in a written plea agreement that from March 9, 2010, to May 25, 2013, he and others devised and participated in a scheme to defraud and to obtain money from the U.S. Treasury Department.

Sentencing for Fisher is set for March 27, 2020, at 10:30 a.m.  He faces a maximum sentence of 20 years’ imprisonment.

The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Kathy A. Enstrom, Special Agent-in-Charge of the Chicago office of the Internal Revenue Service – Criminal Investigation Division; Craig Goldberg, Inspector-in-Charge of the Chicago Division of the U.S. Postal Inspection Service; and James M. Gibbons, Special Agent-In-Charge of the Chicago Field Office of Homeland Security Investigations. The government is represented by Assistant U.S. Attorney Michael D. Love.

In the plea agreement, Fisher admitted that from March 9, 2010, through May 18, 2012, he met with PATTY CORDOBA, the owner and manager of PATTY’S TAX SERVICE (“PTS”) - a tax preparation business in Capron and McHenry - and other PTS employees, including MARIO CORDOBA, LUISA CARBAJAL, and ALICIA AREVALO, to provide information to PTS to have fraudulent tax returns prepared and filed on behalf of individuals who resided in Mexico.  As part of the scheme to defraud, Fisher provided false information about individuals who resided in Mexico in order to obtain Individual Taxpayer Identification numbers to file fraudulent federal income tax returns. During that time period, Fisher provided PTS with identifying information for eleven individuals and their dependents, all of whom resided in Mexico.  Fisher admitted he told those individuals that he was going to use their information for tax purposes and that he would give them money for allowing him to use their information.  Fisher admitted that he provided the fraudulent individual tax identification numbers to Patty Cordoba and other employees of PTS to prepare 53 fraudulent Form 1040s in those names. 

After May 18, 2012, Fisher continued the scheme to defraud by preparing four additional fraudulent Form 1040s for the 2012 tax year, and he signed the four returns in the names of those individuals.  Fisher admitted that he, Patty Cordoba, Mario Cordoba, Luisa Carbajal, Arevalo and other PTS employees mailed the 57 returns to the IRS Service Centers in Austin, Tex., Fresno, Calif., and Kansas City, Mo.  Fisher also admitted that after some of the returns were filed, the IRS requested additional information on some of the returns filed and that he provided letters to Patty Cordoba and other PTS employees who prepared letters in response to the IRS letters.  Patty Cordoba signed the letters in the names of the other individuals and either Fisher or Patty Cordoba or another PTS employee mailed the letters to the IRS.

Based on the 57 false and fraudulent Form 1040s submitted to the IRS, the U.S. Treasury issued and mailed tax refund checks to the addresses listed on the false tax returns in the names of those individuals.  Patty Cordoba opened bank accounts in the names of ten individuals.  Fisher deposited the 57 tax refund checks into those accounts or into his own bank account and withdrew the funds from some of the bank accounts.  As a result of Fisher’s filing of the 57 fraudulent tax returns, the IRS issued approximately $207,467 in refunds to which Fisher was not entitled.

Patty Cordoba, of Crystal Lake, and several others were charged in a related case.  Patty Cordoba pleaded guilty to mail fraud and on Sept. 28, 2016, and was sentenced to 55 months in federal prison and ordered to pay restitution of $1,115,072.  Her co-defendants in that case also pleaded guilty to mail fraud, including: Arevalo, of Poplar Grove, who was sentenced on Aug. 29, 2016, to 21 months in prison and ordered to pay restitution of $1,115,072; CESAR BESICHE, also known as Cesar Beciche-Barranco, of McHenry, who was sentenced on March 15, 2016, to time served and ordered released to the U.S. Department of Immigration and Customs Enforcement for processing of deportation proceedings against him; Carbajal, of Marengo, who was sentenced on June 23, 2016, to 16 months in prison and ordered to pay restitution of $1,115,072; Mario Cordoba, of Crystal Lake, who was sentenced on Sept. 1, 2016, to 33 months in prison and ordered to pay restitution of 1,115,072; OLGA LIDIA DIAZ-HERNANDEZ, also known as Olga Diaz, of McHenry, who was sentenced on July 8, 2016, to 21 months in prison and ordered to pay restitution of $166,296; VERONICA SANCHEZ-BARRADAS, of McHenry, who was sentenced on June 7, 2016, to 27 months in prison and ordered to pay restitution of $252,398; and VICTOR HERNANDEZ, of McHenry, who was sentenced on May 31, 2016, to 27 months in prison and ordered to pay restitution of $252,398.

CHICAGO — A suburban man has been sentenced to 15 years in federal prison for his role in transporting fentanyl and other drugs to the United States from China and selling it on the streets of Chicago.

NESTOR BURGOS, 32, of River Grove, pleaded guilty earlier this year to federal drug and firearm charges.  Burgos admitted dealing narcotics and possessing two handguns and a silencer in furtherance of his drug trafficking activities.

U.S. District Judge Sara L. Ellis imposed the 15-year sentence Monday in federal court in Chicago.

The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; James M. Gibbons, Special Agent-in-Charge of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Chicago; and Craig Goldberg, Inspector-in-Charge of the U.S. Postal Inspection Service in Chicago.

“Fentanyl is a powerfully lethal opioid which defendant brought to the streets of Chicago,” Assistant U.S. Attorney Terry M. Kinney argued in the government’s sentencing memorandum.  “Words cannot begin to describe the horrific damage that fentanyl has unleashed upon American society.”

“Criminals like Burgos are profiting from deadly addictions, and the snares of these addictions entrap more people every day,” said HSI Special Agent-in-Charge Gibbons.  “Let this sentence serve as a reminder that HSI will work tirelessly with its law enforcement and judicial partners to bring to justice those who supply our streets with fentanyl and other deadly synthetic opioids.”

Burgos admitted in a plea agreement that in the summer of 2017 he worked with ROLANDO ESTRADA to transport fentanyl, fentanyl analogues, heroin, and cocaine via mail from China to Chicago.  At the time, Estrada, formerly of Elmwood Park, was residing in Mexico and had ordered the drugs via the internet.  After selling the fentanyl and other drugs in the Chicago area, Burgos used bitcoins to pay Estrada a portion of the illicit proceeds. 

Estrada was also charged as part of the investigation.  He was arrested in April 2018 in Querètaro, Mexico.  After being extradited to Chicago, Estrada pleaded guilty to federal drug charges earlier this month before U.S. District Judge Ronald A. Guzman.  Estrada admitted in a plea declaration that he trafficked cocaine and a fentanyl analogue in the Chicago area in 2015 and 2016.  Judge Guzman set Estrada’s sentencing for Feb. 19, 2020, at 10:00 a.m.

Four former executives and two former employees of Outcome Health (Outcome), a Chicago-based health technology start-up company founded in 2006, were charged for their alleged roles in a fraud scheme that targeted the company’s clients, lenders and investors, and involved approximately $1 billion in fraudulently obtained funds.

Charged in a superseding indictment filed in the Northern District of Illinois and unsealed today are:

• Rishi Shah, 33, of Chicago, Illinois, the co-founder and CEO of Outcome Health, which was known as ContextMedia prior to January 2017;
• Shradha Agarwal, 34, of Chicago, the president of Outcome Health, who was branded as a co-founder;
• Brad Purdy, 30, of San Francisco, California, the chief operating officer and chief financial officer; and
• Ashik Desai, 26, of Philadelphia, Pennsylvania, the executive vice president of business operations and, more recently, the chief growth officer of Outcome.

Charged in an information filed in the same district are:

• Kathryn Choi, 29, of New York, New York, a senior analyst; and
• Oliver Han, 29, of Chicago, an analyst.

An initial appearance and arraignment for Shah, Agarwal and Purdy in federal court in Chicago have not yet been scheduled. An initial appearance and arraignment for Desai are set for Dec. 3, 2019, at 10:00 a.m., before U.S. District Judge Thomas M. Durkin.

An initial appearance and arraignment for Choi and Han are set for Dec. 5, 2019, at 1:30 p.m., before U.S. Magistrate Judge Jeffrey Gilbert.

“Outcome’s former executives and employees allegedly deceived lenders, investors, and their own auditors by falsely representing revenue for additional profit,” said Principal Deputy Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division.  “The charges announced today demonstrate that lies and deception cannot serve as the basis for any company, including start-up companies, to falsely grow revenue for additional capital and private gain.”

 “The deception alleged to have been committed by the defendants tricked clients into paying for advertising it failed to deliver and served to falsely inflate the value of Outcome Health,” said Assistant U.S. Attorney Brian Hayes, Chief of the Criminal Division for the Northern District of Illinois.  “Our office will continue to investigate and hold accountable those who perpetrate fraud schemes.”

“These charges demonstrate that the FBI and its partners will hold businesses accountable for their misconduct,” said Deputy Special Agent in Charge Larry L. Lapp of the FBI’s Chicago Field Office.

“The defendants were charged with allegedly over-inflating the company’s revenue figures in order to fraudulently obtain loans from banks,” said Inspector General Jay N. Lerner of the Federal Deposit Insurance Corporation’s Office of Inspector General (FDIC-OIG).  “This scheme was orchestrated by former leaders of the organization who personally benefitted from hundreds of millions of dollars.  We are committed to working with our law enforcement partners to investigate individuals involved in the crime and to preserve the integrity of the banking system.”

As alleged in the superseding indictment and information, from 2011 to 2017, the former executives and employees of Outcome, a digital provider of medical information and advertising in doctors’ offices, sold tens of millions of dollars of advertising inventory that did not exist.  This allegedly resulted in inflated financial statements that the former executives used to raise nearly $1 billion in debt and equity financing in 2016 and 2017.  Shah, Agarwal and Purdy are each charged with various counts of mail fraud, wire fraud and bank fraud.  Purdy is also charged with one count of false statements to a financial institution, and Shah is also charged with two counts of transactions in criminal proceeds.  Desai is charged with one count of wire fraud.  Choi and Han are each charged with one count of conspiracy to commit wire fraud.

According to the allegations, the former executives and employees perpetrated a fraudulent scheme by selling clients—most of whom were pharmaceutical companies—advertising inventory the company did not have and then under-delivering on its advertising campaigns.  Despite these under-deliveries, the company allegedly still invoiced its clients as if it had delivered in full.  To conceal the under-deliveries, the former executives and employees allegedly falsified affidavits and proofs of performance to make it appear the company was delivering advertising content to the number of screens in its clients’ contracts, and also inflated patient engagement metrics regarding how frequently patients engaged with Outcome’s tablets.  Furthermore, Desai allegedly altered a number of studies presented to clients to make it appear that the campaigns were more effective than they actually were.

The charging documents also allege that the under-delivery resulted in a material overstatement of Outcome’s revenue for the years 2015 and 2016.  The company’s outside auditor signed off on the 2015 and 2016 revenue numbers because Purdy, Desai, Choi and Han allegedly fabricated data to conceal the under-deliveries from the auditor.  Shah, Purdy and Agarwal then allegedly used the inflated revenue figures in Outcome’s 2015 and 2016 audited financial statements to raise $110 million in debt financing in April 2016, $375 million in debt financing in December 2016 and $487.5 million in equity financing in early 2017.  The $110 million debt financing allegedly resulted in a $30.2 million dividend to Shah and a $7.5 million dividend to Agarwal; the $487.5 million equity financing allegedly resulted in a $225 million dividend to Shah and Agarwal.

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

The FBI and FDIC-OIG are investigating the case.  Assistant Chief William E. Johnston and Trial Attorney Kyle C. Hankey of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Matthew F. Madden of the Northern District of Illinois are prosecuting the case.  Daniel Olinghouse of the Criminal Division’s Money Laundering and Asset Recovery Section has assisted with forfeiture matters.

The U.S. Securities and Exchange Commission provided assistance in this case.