Southern District of Indiana

Coalition Against Insurance Fraud awards Prosecutor of the Year citations to federal attorneys

PRESS RELEASE

Evansville-United States Attorney Josh J. Minkler announced today a national award given to two Assistant United States Attorneys serving in the Evansville office for their work in prosecuting an elaborate insurance fraud scheme. Todd Shellenbarger the branch chief in the Evansville U.S. Attorney’s Office and Kyle Sawa, prosecuted Michael Burris and 35 other defendants on fraud charges.

“I am proud of the work all of our AUSA’s do on a daily basis,” said Minkler, “but today, I am especially proud of Todd and Kyle for their exceptional work. The Burris family was the face of organized crime in the Evansville area and they put many public safety officials in harm’s way through their criminal acts.”

Between 2008 and 2014, Michael W. Burris and others, planned a series of automobile crashes in and around Evansville. They recruited persons to participate in staged vehicle crashes, made false police reports about the crashes and then filed false claims with insurance providers for “injuries” suffered in the crashes that were self-inflicted.

The Prosecutor of the Year Award is a national honor that recognizes exceptional courtroom achievements and best practices in combatting insurance crime. It is presented by the Coalition Against Insurance Fraud, a national alliance of consumer groups, insurance companies and government agencies combatting all forms of insurance fraud.

“Staged crashes literally drive up auto premiums for honest Indiana motorists,” said Dennis Jay, Executive Director, Coalition Against Insurance Fraud. “The Burris family was a factory line of fraud. It took exceptional courtroom skill by Todd Shellenbarger and Kyle Sawa to unravel their complex crash scheme and launch them on the exit ramp to prison.”

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Victim attacked while mowing his yard.

PRESS RELEASE

Indianapolis-Josh J. Minkler, the United States Attorney for the Southern District of Indiana, announced today that Rene A. Boucher, 58, Bowling Green, Kentucky, has been charged with assaulting a member of congress resulting in personal injury, a felony under federal law.

“Assaulting a member of Congress is an offense we take very seriously,” said Minkler. “Those who choose to commit such an act will be held accountable.”

According to court documents, Boucher and the victim are neighbors in Bowling Green, Kentucky. On November 3, 2017, the victim was mowing his yard while wearing headphones. Boucher allegedly witnessed the victim stack brush onto a pile near the victim’s property and “had enough.” Boucher ran onto the victim’s property and tackled the victim.  As a result of this assault, the victim suffered multiple fractured ribs and subsequently contracted and required medical attention for pneumonia. Boucher admitted the assault but denied it was politically motivated.  

The United States Attorney’s Office for the Southern District of Indiana was assigned the case following the recusal of the United States Attorney’s Office for the Western District of Kentucky where the offense is alleged to have been committed.

Boucher has signed a plea agreement but no date has been set for the taking of his guilty plea and the imposition of sentence.

This case was investigated by the Louisville office of the Federal Bureau of Investigation.

"Just as we are committed to protecting the American people, the FBI will not tolerate violence directed against members of Congress," said Special Agent in Charge Amy S. Hess of the FBI's Louisville field office.  "Those who choose to assault any federal official are certain to face serious consequences."

No future court dates have been set.

An information is only a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.

According to Assistant United States Attorney Bradley P. Shepard of the United States Attorney’s Office for the Southern District of Indiana who is prosecuting this case as a Special Attorney to the United States Attorney General, Boucher faces up to 10 years’ imprisonment and a fine of up to $250,000.

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Alleged to owe over $1 million in taxes

PRESS RELEASE

Indianapolis-Josh J. Minkler, the United States Attorney for the Southern District of Indiana, announced today the indictment on federal tax evasion charges against a Brownsburg man. Scott C. Cole, 53, was indicted on two counts of tax evasion.

“We all have an obligation to pay our share of taxes to keep our government operating,” said Minkler. “Those who choose to steal from the government and expect others to carry the tax burden will be held accountable.”

The indictment alleges that on April 11, 2008, the IRS mailed a notice to Cole and his wife stating they omitted approximately 1.2 million of income and approximately $1.3 million in self-employment income from their 2001 tax return.  The IRS assessed an income tax deficiency of $556,187 and a fraud penalty of $417,140. Further, the tax court ruled that Cole’s 2002 tax return was deficient by nearly $54,000, assessing a penalty of $40,458 in addition to the $14,261 that was due. Cole disputed his tax liability but the Federal Tax Court and the U.S. Court of Appeals affirmed the IRS assessment.  

The indictment further alleges that Cole attempted to evade and defeat tax payments by opening bank accounts with artificial company names and directed payment for services he rendered to the same artificial companies. He paid personal expenses through third-party business accounts, dealt extensively in cash and filed false 1040 tax returns understating taxable income.

This case was investigated by the Internal Revenue Service Criminal Investigation.

Gabriel Grchan, Special Agent in Charge of IRS Criminal Investigation stated, "I am pleased to join the United States Attorney in announcing tax evasion charges against Mr. Cole.  IRS-Criminal Investigation is the first line of defense against those that choose to evade their federal tax obligations.  With the 2018 tax filing season upon us, these charges should send a strong warning that those who illegally hide their income will be held accountable."

Cole had his initial appearance before a magistrate judge yesterday. He was released on GPS monitoring and must follow a strict curfew. His trial date is set for March 19, 2018.

An indictment is only a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.

According to Assistant United States Attorney James M. Warden who is prosecuting this case for the government, Cole faces up to five years’ imprisonment and a fine of up to $250,000 for each count if convicted as well as full restitution to the government.

In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges.  This prosecution demonstrates the office’s firm commitment to utilize and partner with the law enforcement agencies to prosecute individuals engaged in income tax evasion. See United States Attorney’s Office, Southern District of Indiana Strategic Plan  Section 5.4.

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Project Safe Neighborhoods initiative focuses federal resources on the most violent areas of Marion County with an emphasis on gun crime

 

PRESS RELEASE

Indianapolis -United States Attorney Josh J. Minkler and Attorney General Jeff Sessions today announced a renewed federal commitment to helping reduce violent crime in this country’s most violence-ridden neighborhoods. The Southern District of Indiana will receive one additional Assistant United States Attorney (AUSA) to focus exclusively on violent crime, one of 40 new federal prosecutors in 27 selected locations around the country.

The Project Safe Neighborhoods (PSN) initiative will focus the new AUSA’s attention, on prosecuting violent offenders as well as assigning an AUSA to each of IMPD’s six districts to monitor and prosecute the worst violent offenders in our neighborhoods.  Further, PSN will focus on coordinating federal, state and local resources under the leadership of Minkler, featuring prevention, targeted law enforcement and accountability.

“It is no secret that Indianapolis is struggling with violent crime.  Our homicide rate is unacceptable and together, we can do something about it,” said Minkler.  “Criminals who choose to use guns and other means of violence to disrupt our city should think again because gun crime comes with big federal prison time.”

“I have asked Congress for additional PSN funding next year because I believe nothing will be more effective at reducing violent crime,” said Sessions.  “Under this program, I am both empowering and holding United States Attorneys around the country accountable for results.”

"Our Indianapolis gun violence will only be impacted with the collective help of our community and law enforcement partners,” said IMPD Chief Bryan Roach.  “We continue to be blessed with a cooperative mindset and willingness to improve the city of Indianapolis from our United States Attorney's Office.  We look forward to the continued partnership and a new AUSA focus on our geographic districts and most violent offenders." 

In addition to the Southern District of Indiana, other states receiving new attorneys include: Alabama, Arkansas, California, Connecticut, Washington DC, Illinois, Louisiana, Maryland, Michigan, Missouri, Nevada, New Mexico, New York, Ohio, Pennsylvania, Tennessee, Texas and Wisconsin.

In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges.  This prosecution demonstrates the office’s firm commitment to utilize and partner with the District’s law enforcement agencies to detect and prosecute matters involving violent crime in our neighborhoods.  See United States Attorney’s Office, Southern District of Indiana Strategic Plan  Section 2.9.

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PRESS RELEASE

Indianapolis-United States Attorney Josh J. Minkler announced today the sentencing of an Indianapolis man for his role in an elaborate scheme to defraud local business.  James D. Victery, 58, Indianapolis, was sentenced to 48 months’ imprisonment by U.S. District Judge Michael Reagan after being found guilty in a jury trial in September of this year.  At trial, Victery was found guilty of two counts of wire fraud and two counts of money laundering.

“Mr. Victery’s greed cost local businesses and the government nearly $600,000 in losses,” said Minkler.  “Let’s call white collar crime, what it really is; stealing, and those who do will be held accountable for their actions.”

Victery represented himself as a person who was in the business of providing a variety of services to contractors who were considering bidding on government jobs.  Those services included acting as an escrow agent, providing bonds, and loans, through a company called TEAM (Tripartite Escrow Agreement Management).  The victim-business was a factoring agent that agreed to pay contractors’ invoices before the government was ready to pay, giving the contractors’ prompt access to money to fund their construction projects.  Victery purported to his victim-business that he would serve as an escrow agent, holding in trust the money exchanged between the victim-business and the contractors.  Victery provided written agreements and emails memorializing the arrangement.

Victery submitted invoices to the victim-business for work that was never performed by the contractors.  The evidence at trial revealed Victery had misrepresented himself to the contractors as a provider of bonds, and to the victim-business as an escrow agent.  The victim-business paid almost $600,000 to Victery on the fraudulent invoices, and Victery squandered the money on personal business interests and debt in a few months’ time.

This case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation.

“This sentence highlights the partnership of the FBI and IRS and our mission to dedicate investigative resources to rooting out such corrupt business practices and hold people accountable for their financial fraud,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division.  “These criminals are motivated by greed and a desire to see how much they can get away with without care or concern for the consequences and it won’t be tolerated.”

Gabriel Grchan, Special Agent in Charge of IRS Criminal Investigation stated, “IRS-CI does not tolerate corrupt business practices that put taxpayers’ dollars at risk.  This investigation compliments the many other IRS-CI successes of 2017, announced last week in the IRS-CI Annual Report.  We are committed to identifying and stopping financial frauds.”

According to Cindy Cho and Winfield Ong who prosecuted this case for the government, Victery must make restitution of $404,000 and serve three years supervised released release after his sentence.

In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges.  This prosecution demonstrates the office’s firm commitment to utilize and partner with the District’s law enforcement agencies to detect and prosecute matters involving complex fraud schemes. See United States Attorney’s Office, Southern District of Indiana Strategic Plan  Section 5.1.

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Used skimming machines in gas pumps to steal credit card numbers and identities

PRESS RELEASE

EVANSVILLE- United States Attorney Josh J. Minkler announced today the sentencing of two Louisville area residents for their role in an elaborate scheme to steal innocent victims’ identity and make and use fraudulent credit cards. Roberto Moner, 30, Louisville, was sentenced to 48 months imprisonment by U.S. District Judge Richard L. Young, after pleading guilty to conspiracy to possess counterfeit or unauthorized access devices, possession of counterfeited or unauthorized access devices, conspiracy to produce, use, and traffic in one or more counterfeit access devices, possession of device-making equipment, and aggravated identity theft.  In November 2017, Moner’s co-defendant, Adianez Herrera, 45, Louisville, was sentenced to 48 months imprisonment by Judge Young for the same charges.

“Identity theft is one of the faster growing crimes in the United States,” said Minkler. “We will not let advances in technology fall into the hands of criminals to take advantage of law-abiding citizens. Those who prey on citizens and steal their identity will be held accountable.”  

In December 2015, the Jasper Indiana Police Department received information that a victim had her credit card information compromised.  Law enforcement later learned that Moner installed card-skimming machines at gas stations in the Jasper Indiana vicinity.  Using the skimming devices, he was able to obtain information from the credit card and download the information onto other stolen or counterfeit cards to make illegal purchases. 

Moner and Herrera used the counterfeit and stolen cards to make purchases worth thousands of dollars in the Jasper area for items such as gift cards, cartons of cigarettes, and other personal items.  The investigation revealed that hundreds of individuals had their credit card information stolen.

This case was investigated by the United States Secret Service, FBI and Jasper Indiana Police Department

     “The success in this case demonstrates the investigative capabilities of the United States Secret Service and the collaborative efforts of our law enforcement partners” said Paul Dvorak, Special Agent in Charge of the U.S. Secret Service Indianapolis Field Office.  “Our developed partnerships with other federal, state and local law enforcement agencies as well as private sector stakeholders, enables us to focus our resources to uncover, investigate and prevent these crimes more effectively.”

“The crime of identity theft and the scams associated with it have become more sophisticated and pervasive.  These individuals thought they could target a small community and there wouldn’t be the resources to catch them,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division.  “The FBI, along with our federal and local partners, is dedicated to stopping these perpetrators and educating the public on ways they can ensure they don’t fall victim to these schemes.”

According to Assistant United States Attorney Kyle Sawa who prosecuted this case for the government, Moner and Herrera must each serve three years of supervised release after their sentences and make restitution to the known victims in the case.

In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges.  This prosecution demonstrates the office’s firm commitment to utilize and partner with the District’s law enforcement agencies to detect fraud and identity theft schemes. See United States Attorney’s Office, Southern District of Indiana Strategic Plan  Section 4.5.

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PRESS RELEASE
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
Laura A. Briggs, Clerk
46 East Ohio Street
Indianapolis, IN 46204

INDIANAPOLIS, Indiana (November 17, 2017): The Honorable Jane E. Magnus-Stinson, Chief Judge of the United States District Court for the Southern District of Indiana, is pleased to announce the selection of attorney Doris L. Pryor as United States Magistrate Judge. Ms. Pryor’s appointment will be made upon completion of a Federal Bureau of Investigation background check, a process that can take several months. Once appointed, she will fill the vacancy created by the untimely death of Magistrate Judge Denise K. LaRue, who passed away on August 2, 2017.

Ms. Pryor is presently employed as the National Security Chief for the United States Attorney’s Office for the Southern District of Indiana and has served in that role since September 2014. From August 2006 until her appointment as National Security Chief, she served as an Assistant United States Attorney for the Southern District of Indiana. From August 2005 through August 2006, Ms. Pryor served as a Deputy Public Defender in the State of Arkansas Public Defender’s Commission. She also has served two terms as a law clerk, for Judge J. Leon Holmes in the U.S. District Court for the Eastern District of Arkansas (August 2004-August 2005), and for Chief Judge Lavenski Smith of the U.S. Court of Appeals for the Eighth Circuit (August 2003-August 2004).

Chief Judge Stinson said, “The court eagerly anticipates welcoming Ms. Pryor to the bench. She has demonstrated ability to handle complex cases in her varying assignments as an Assistant United States Attorney. She has also demonstrated her commitment to the principle of equal justice under law during her laudable career with the U.S. Attorney’s Office and, before that, as a deputy public defender. My fellow judges and I know that Ms. Pryor will serve the litigants who appear before her in court with the same fairness and equanimity for which she is already renowned.”

The duties of Magistrate Judges in the Southern District of Indiana are demanding and wide-ranging. Ms. Pryor will conduct various pretrial matters and evidentiary proceedings in civil cases on delegation from a district judge, and preside over trial and disposition of civil cases upon consent of the litigants. After a period of recusal, she will also conduct preliminary proceedings in criminal cases, and preside over trial and disposition of misdemeanor cases. Ms. Pryor will primarily serve in the Indianapolis Division of the Southern District and travel to the other divisional offices of the Court to hold proceedings and conduct settlement conferences.

Ms. Pryor was born in Hope, Arkansas, and graduated with a Bachelor of Science degree in 1999 from the University of Central Arkansas, where she majored in political science. She obtained her law degree from the Indiana University Maurer School of Law in 2003 and was admitted to the bar the same year. Ms. Pryor has since been admitted to practice in numerous state and federal courts, including Indiana. Ms. Pryor is active in Indiana’s legal community. She is currently serving as the program chair for the Indianapolis branch of the Federal Bar Association and has previously served as the secretary and newsletter chair of that organization. Ms. Pryor is active in a number of other bar associations and chaired the Indianapolis Bar Association Diversity Job Fair’s Student Workshop in 2016 and 2017. Ms. Pryor was also instrumental in the development and growth of the Southern District of Indiana’s Re-entry And Community Help (REACH) federal re-entry courts, which give formerly incarcerated individuals access to resources, law enforcement officials, community leaders, and other experts to help the returning citizens transition successfully back into the community.

Ms. Pryor also serves her community as a board member of Goodwill Education Initiatives, Inc., and as the Young Adult Ministry Co-Director for the Pilgrim Missionary Baptist Church. She is also passionate about the Just the Beginning Foundation, which is committed to developing and nurturing interest in the law among young persons from various socioeconomic, ethnic, and cultural backgrounds underrepresented in the legal profession.

Ms. Pryor lives in Carmel with her husband and son.

Magistrate Judges are appointed by the Judges of the United States District Courts for terms of eight years, and are eligible for reappointment to successive terms.

Stole more than $110,000 from Vigo County taxpayers

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler announced today that a former Vigo County School Corporation official, Franklin V. Fennell, 49, Terre Haute, was found guilty in federal court on fraud, bribery and false statement charges following a three-day jury trial before U.S. District Judge Jane Magnus-Stinson.

“Public officials are supposed to serve the public, not the other way around,” said Minkler. “When greed becomes more important than serving the public, there are consequences and my office will hold offenders accountable.”

Fennell was the facilities director at the Vigo County School Corporation (VCSC). His duties included the maintenance and service at all VCSC locations and facilities, including schools. Fennell routinely submitted requisitions to the VCSC business office which in turn created purchase orders that were sent to vendors authorizing work. The vendor would then be paid after the work was completed.

From April 2014 through October 2016, Fennell and co-defendant, Frank Shahadey instructed a Terre Haute area businessman to submit false and fraudulent invoices for work performed for the VCSC by either inflating the cost of the work or seeking payment for work that was either not performed, or was done by another business. Once paid by the VCSC based on the false and fraudulent invoices, the businessman kicked back a portion of the ill-gotten gains to Fennell and Shahadey and retained a portion for his personal benefit.

As a result of this fraud scheme, Fennell and Shahadey received kickbacks of more than $110,000.  When confronted by special agents of the Federal Bureau of Investigation regarding this fraudulent scheme, Fennell made various false statements in a futile effort to exculpate himself.

This case was investigated by the Federal Bureau of Investigation.

"This conviction affirms that the FBI has zero tolerance for public corruption and considers it a top criminal priority," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "We are dedicated to eradicating public corruption at all levels of government and our agents will continue to work diligently to pursue those public officials whose greed erodes the confidence and trust of taxpayers."

Fennell’s co-defendant, Frank Shahadey, was sentenced to 16 months’ imprisonment in October 2017, after pleading guilty to wire fraud and theft charges based on his involvement in this scheme.

According to Assistant United States Attorneys Tiffany Preston and Nicholas Linder who prosecuted this case for the government, Fennell could face up to 20 years’ imprisonment. 

No sentencing date has been set.

            In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges.  This prosecution sentencing demonstrates the office’s firm commitment to detect and prosecute matters involving public corruption, (See United States Attorney’s Office, Southern District of Indiana Strategic Plan, Section 5.3)

 

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Alleged to have sold large quantities of methamphetamine in Indiana and Kentucky

New Albany – Josh J. Minkler, United States Attorney for the Southern District of Indiana and Russell M. Coleman, United States Attorney for the Western District of Kentucky, announced today the dismantling of a large drug trafficking organization (DTO) selling methamphetamine in Indiana and Kentucky.

“Drug trafficking brings gun violence that many of our Midwestern communities are experiencing,” said Minkler. “Those who choose to sell drugs in our neighborhoods will experience the full brunt of federal law enforcement and realize the Ohio River will not stifle or cooperative effort between law enforcement agencies.”

“The Department of Justice and our law enforcement partners stood shoulder to shoulder last week to promise intelligence-driven targeting of these violent drug trafficking organizations harming this great city,” said U.S. Attorney Russell Coleman. “Today’s arrests are yet another deposit on this promise; stay tuned.”

Those charged in the Southern District of Indiana with conspiracy to distribute methamphetamine include: Clifton Jones, 31, Gregory Churchill, 33, and Stanley Duke, Jr., 41 all from Louisville;  Billy Dale Sears, 44, Harry Edelen, 44, Roger Carroll, Jr., 47, from New Albany, Indiana; and Chad Albertson, 40, from Salem, Indiana. Duke faces an additional charge of possession of a firearm by a convicted felon.

            The indictment alleges that Billy Dale Sears was the leader and supervisor of the DTO which conspired to distribute large quantities of methamphetamine. Sears would obtain the methamphetamine from Clifton Jones and Gregory Churchill who both lived in Louisville. Sears would then distribute the methamphetamine to mid-level dealers in New Albany, Jeffersonville, Salem and Louisville for redistribution throughout Southwestern Indiana and Northern Kentucky.

Throughout the conspiracy, it is alleged that the DTO sold methamphetamine on a “front’ basis, where defendants provided large quantities of methamphetamine on consignment to distributors. Payment was received after the sale by other distributors. The defendants also used telephones, using code language and text messages to discuss matters relative the trafficking operation.

In a separate indictment, returned by a grand jury in Louisville on December 5, 2017, and unsealed today, eleven defendants, all from Louisville, were charged in a single count with conspiring with each other to possess with the intent to distribute 50 grams or more of methamphetamine, a Schedule II controlled substance.

            Defendant Clifton Jones additionally faces charges in the Western District of Kentucky, along with co-defendants Dontay L. Rice, Eric R. Estey, 35,  Dandre L. Taylor, 35, Odell P. Smith, Jr., 34, William C. Freeman, 32, James E. Hall, 33, Chad J. Heiser, 37, Clarence W. Rice, Jr., Alex M. Bowles, 25, and Joseph R. Willis, 21.

             All but defendant Heiser were arrested Thursday, and are in federal custody. Defendants charged in the WDKY are scheduled for an initial appearance before Magistrate Judge Dave Whalin, in Louisville, at 2:00pm. Defendants charged in the Southern District of Indiana were scheduled to appear Friday morning before Magistrate Judge Van T. Willis.

This case was investigated by the Federal Bureau of Investigation in Indiana and Kentucky, IRS Criminal Investigation, ATF, United States Marshal Service, Jeffersonville Police Department, New Albany Police Department, Clarksville Police Department, Clark County Sheriff’s Department, Harrison County Sheriff’s Department, Indiana State Police and the Louisville Metro Police Department.

“Working collaboratively with our federal, state, and local partners we are able to target, disrupt and dismantle criminal enterprises such as this that use violence in the commission of their illegal activities so they can no longer terrorize our communities,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. 

“The FBI and its partners remain dedicated to disrupting and dismantling the most violent offenders and organizations through intelligence-driven investigations,” said Amy S. Hess, Special Agent in Charge FBI Louisville. “Our goal remains the same: stop the violence, get drugs and weapons off the streets, and deliver justice for the people who live in the communities we serve.”

According to Assistant United States Attorney Lauren M. Wheatley who is prosecuting this case for the Southern District of Indiana and Assistant United States Attorney J. Scott Davis, from the Western District of Kentucky, all defendants face ten years to life if convicted.

An indictment is merely a charge and not evidence of guilt. All defendants are considered innocent until proven guilty in federal court.

Larry Westby swindled friends and acquaintances out of nearly $1 million

PRESS RELEASE

Indianapolis - United States Attorney Josh J. Minkler announced today the sentencing of a former Indiana man who stole nearly one million dollars from unsuspecting investors. Larry M. Westby, 65, currently residing in Vanderbilt, Michigan, was sentenced to 90 months (7.5 years) imprisonment by Chief U.S. District Judge Jane Magnus-Stinson after pleading guilty to wire fraud, securities fraud and fraud in the offer or sale of securities.

“Perpetrators of fraud crimes not only jeopardize their victims’ financial security, but they also rob their victims of the trust they once had in their own judgment and in others,” said Minkler. “When a person or business intentionally deceives Indiana investors with promises of financial benefits that do not exist, were never intended to be provided, or were misrepresented, they will be prosecuted by this office to the fullest extent of the law.”  

Westby was a licensed respiratory therapist and president of LMW, Inc., a company purported to be selling respiratory therapy protocols to doctors. The protocols allowed doctors to perform treatments inside their own offices, rather than in a hospital.

In January 2010, Westby began using the LMW website to communicate with current and potential LMW investors indicating he was exploring selling his company for a substantial profit. In these communications, Westby made false statements about the nature of LMW, its financial condition, and the risk and status of investments in LMW.  For example, Westby told potential investors that LMW was about to be sold for $36.5 million to a company called Global Spot in an effort to convince investors to buy LMW common stock.  Unbeknownst to investors, Global Spot was a non-existent, sham entity.  Westby also concealed from his investors that he had not registered LMW with the Indiana Secretary of State as a company properly registered to engage in the issuing of stock certificates. Further Westby did not tell investors that he had failed to properly register LMW common stock certificates with the Secretary of State.

  Through these false communications, Westby took in more than $985,000 from his investors, then used the funds to purchase two vehicles, repay a personal loan, pay personal credit card bills, and buy a vintage basketball court for his home.

This case was jointly investigated by the Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation and the Indiana Secretary of State.

IRS Criminal Investigation Special Agent in Charge, Gabriel Grchan, stated, “Mr. Westby told convincing stories to cover his tracks; however, at the end of the day his lies didn’t add up and IRS special agents solved the problem.  Together with our federal partners we work vigorously to shut down corrupt, illegal behaviors that threaten honest and lawful investment practices.”

"This sentence sends a clear message that illegal business practices will not be tolerated," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "The FBI and our law enforcement partners will continue to aggressively pursue individuals who steal money from the pockets of hardworking Hoosiers."

"Mr. Westby was not registered to sell securities with my office," said Secretary of State Connie Lawson. "This is often the number one warning sign that the investment may be a scam. I encourage all investors to do their homework and research investment professionals before making a deal. Hoosiers can ensure their investment professional is registered by looking on our website or by calling our office."

According to Assistant United States Attorney Tiffany J. Preston who is prosecuted this case for the government, Westby must make restitution of over $985,000 and serve three years of supervised release following his sentence.

 

Alleged to have taken bribes to allow prisoners to escape the prison grounds,

have sex on prison property, and introduce contraband into prison

PRESS RELEASE

Terre Haute – United States Attorney Josh Minkler today announced federal criminal charges against a Bureau of Prisons (BOP) correctional officer involved in an elaborate scheme to allow inmates to leave the grounds, have sexual relations on the grounds, and bring contraband into the prison in exchange for cash and other items.  Leon Perry III, age 41, Linton, was arrested today and faces charges that include, conspiracy for an officer to permit escape, conspiracy to bribe public officials, officer permitting escape, public official accepting a bribe and providing contraband in a prison.

“Mr. Perry put the safety and welfare of the inmates, correctional officers, the institution and the entire Terre Haute community in jeopardy by allowing this to occur,” said Minkler.  “He allowed greed and power to betray the confidence we place in prison officials.”

The Federal Correctional Institution (FCI) is a medium-security prison for men operated by the Bureau of Prisons.  Adjacent to the FCI is a minimum-security satellite camp, with no perimeter fencing commonly referred to as the Camp.  Inmates at the Camp are generally permitted to roam the grounds but are forbidden from leaving without prior approval.

During the time referenced in the indictment, Perry worked as the Reservation Patrol Officer at the Federal Prison Camp, whose responsibilities included patrolling the prison grounds to prevent and stop any escape attempts. This included challenging unauthorized vehicles or persons who are on the grounds and maintaining overall security of the facility.  Perry has served as a correctional officer at the BOP for approximately 10 years. 

It is alleged that Perry agreed to be at a different part of the facility grounds when inmates left the facility and went with women to hotels in the nearby Terre Haute, Indiana area.  In exchange for the agreement, Perry accepted cash bribes.  It is further alleged that Perry accepted bribes, including cash and prescription medication, to allow prisoners to have sex with unauthorized visitors on prison grounds.  It is also alleged that Perry accepted bribes in exchange for allowing contraband into the Camp; including cellular telephones, controlled substances, and alcohol. 

"Corruption by law enforcement officers in any facet of their work won't be tolerated," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division.  "The illegal actions by the few corrupt officers undermine the public's confidence in the majority of law enforcement officers who are trustworthy public servants."

“Greed and corruption have no place in our criminal justice system,” stated Special Agent in Charge John F. Oleskowicz of the DOJ Office of the Inspector General’s Chicago Field Office.  “We want to thank our law enforcement partners for their assistance in ensuring that correctional officers who abuse their position are vigorously investigated and prosecuted.”

This case was investigate by the Federal Bureau of Investigation, U.S. Department of Justice Office of the Inspector General and the BOP Special Investigative Services.

According to Assistant United States Attorney Kyle M. Sawa who is prosecuting this case for the government, Perry faces up to 15 years imprisonment if convicted on all counts.

An indictment is merely a charge and not evidence of guilt.  All defendants are considered innocent until proven guilty in federal court.  

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Scammers pose as U.S. Marshals and threaten arrest if victim does not pay a fine

PRESS RELEASE

Indianapolis, Indiana – November 22, 2017:  Chief U.S. District Judge Jane E. Magnus-Stinson and U.S. Attorney Josh Minkler warn the public of a nationwide scam in which the callers pose as U.S. Marshals or other government officials and claim that the victim is about to be arrested for not appearing for jury duty, but can avoid arrest by paying a fine.

The scammers often provide information that seems very convincing, including the real names of federal judges or court employees, the location of the courthouse, and case and badge numbers.  The victim has every reason to believe the call is legitimate. The caller then tells the victim they can avoid arrest by paying an immediate fine and walks them through purchasing a prepaid debit or gift card or making an electronic payment to satisfy the “fine.”

On behalf of the U.S. District Court for the Southern District of Indiana, Chief Judge Magnus-Stinson said, “The people conducting this scam can be very convincing. They call their law-abiding victims and terrify them with threats of arrest and jail unless they pay up immediately. The U.S. Courts do not operate this way. In no instance will a court official, U.S. Marshal, or other government employee contact someone and demand payment or personal information by phone or email. This is a scam, and a lot of people are being hurt.”

“Those who take advantage of trusting citizens must know that there is zero tolerance for this type of behavior,” said Minkler. “Fraudsters and other scammers will face the full force of federal law enforcement for such activity.”

Residents of the Southern District of Indiana who believe they have been the victim of such a scam are encouraged to report the incident to the District Court Clerk’s Office at 317-229-3700; the Federal Trade Commission at https://www.ftccomplaintassistant.gov; and the U. S. Marshals Service at 317-226-6566.

Here is additional information on things to remember, who to call, and what to do if you are contacted by a scammer:

A court will never ask for a credit/debit card number, wire transfers, or bank routing numbers over the phone for any purpose.

A prospective juror who disregards a summons will be contacted by the District Court Clerk’s Office by mail and may, in certain circumstances, be ordered to appear before a judge.

A fine will never be imposed until after an individual has appeared in court and been given the opportunity to explain a failure to appear. 

Do not divulge personal information or financial information to unknown callers.

Report scams to the District Court Clerk’s Office, U.S. Marshals Service, or Federal Trade Commission.

You can remain anonymous when you report.

You can authenticate a call by contacting the Clerk’s Office of the U.S. District Court in Indianapolis at (317) 229-3700 to verify that you were not summoned for jury duty and that the scam call did not come from the court.

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PRESS RELEASE

Evansville – United States Attorney Josh Minkler announced today that a tax preparation business owner was sentenced in federal court for her preparation of over 350 false tax returns in 2015, 2016, and 2017.  Deborah L. Richards, 56, previously pleaded guilty to three counts willfully aiding and assisting in the preparation of false tax returns.  Richards was sentenced to 48 months (four years) imprisonment by U.S. District Judge Richard L. Young.

“We have all learned to trust our tax preparer to tell us what we rightfully owe or are due from the government,” said Minkler.  “Ms. Richards betrayed that trust and because of her greed, is going to have four years in the Bureau of Prisons to think about her actions.”

In 2015, Richards worked for Desirable Tax Services in Washington, Indiana, and prepared tax returns for clients.  Then in 2016, Richards established Terry’s Tax Service in Vincennes, Indiana, where prepared tax returns for clients in 2016 and 2017. 

Richards claimed false education credits, false American Opportunity credits, and false itemized deductions to inflate refunds due to her clients.  In addition, she provided altered copies of the tax returns to her clients which were different from the tax returns she caused to be filed with the Internal Revenue Service.  Richards then charged increased fees for her preparation of these fraudulent tax returns.  According to Assistant U.S. Attorney James Warden who prosecuted this case for the government, Richards earned over $250,000 in fees for her fraudulent tax preparation work.

As a result of Richards’ efforts, more than 350 false federal income tax returns were filed with the IRS between 2014 and 2017, which resulted in a loss to the Internal Revenue Service and the American taxpayers of $550,001.

Gabriel Grchan, Special Agent in Charge of IRS Criminal Investigation, said, “IRS-CI does not tolerate abuse of the U.S. tax system to enrich the greedy at the expense of the honest.  Ms. Richards abused her position of trust with the taxpayers she represented for her own personal gain.  IRS special agents identified Richards’ scheme, collected the evidence, and today, obtained justice for the American taxpayer.”   

Judge Young ordered Richards to pay restitution to the Internal Revenue Service in the amount of $550,001.

Richards must serve one year of supervised release following her sentence.  

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The former compliance director of an Indiana compounding pharmacy pleaded guilty to introducing adulterated drugs into interstate commerce and conspiracy to defraud the United States by obstructing the Food and Drug Administration’s (FDA) lawful functions, the Department of Justice announced today. 

 

Caprice R. Bearden, 63, of Carmel, Indiana, pleaded guilty in the Southern District of Indiana to one count of conspiracy to defraud the United States, three misdemeanor counts of introducing an adulterated drug in interstate commerce, and six misdemeanor counts of adulterating drugs while held for sale after shipment of a drug component in interstate commerce.  Bearden was the Director of Compliance for Pharmakon Pharmaceuticals Inc. (Pharmakon).  Pharmakon compounded drugs at a facility in Noblesville, Indiana, for customers in various states.

 

Chief U.S. District Judge Jane E. Magnus-Stinson accepted Bearden’s plea. A date for sentencing has not been sent yet.

 

"This guilty plea demonstrates the Justice Department’s commitment to protecting patients and ensuring that compounded drugs are safe,” said Principal Deputy Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division.  “Distributing out-of-specification drug products poses a serious risk of harm to patients.  The Justice Department will not tolerate efforts to impede FDA’s ability to uncover these types of safety concerns.” 

“This defendant distributed serious drugs to hospitals in Indiana and around the country, knowing that the drugs were significantly under or over the strength they were supposed to be,” said Josh Minkler, United States Attorney for the Southern District of Indiana.  “She put greed and the reputation of her company ahead of the health and safety of our most vulnerable patient populations.”

 

As part of her plea agreement, Bearden acknowledged that during 2014 and 2016 FDA inspections, she lied about Pharmakon’s never having received any out-of-specification drug potency test results.   Bearden also acknowledged that she knowingly conspired with another individual to defraud the United States by obstructing the lawful functions of the FDA.  In addition, she acknowledged that it was the purpose of the conspiracy to prevent the loss of revenue that would result from customers’ and FDA’s knowledge of Pharmakon’s having distributed numerous compounded drugs that were not the strength purported on the drugs’ labeling. 

 

“This is an egregious example of how harmful conduct can result in risk to patients. The disregard for the law resulted in the injury of infants from poorly compounded, super potent morphine products,” said FDA Commissioner Scott Gottlieb, M.D. “We will not tolerate substandard practices, like failing to meet federal manufacturing standards like those found at Pharmakon, that put patients at risk and will aggressively pursue individuals that put profit ahead of patient safety.”

 

The conspiracy charge to which Bearden pleaded guilty carries a statutory maximum sentence of five years in prison and a fine of $250,000 or twice the gross gain or gross loss from the offense.  The misdemeanor charges of distributing an adulterated drug in interstate commerce and adulterating drugs while held for sale after shipment of a drug component in interstate commerce each carry a statutory maximum punishment of one year in prison and a fine of $100,000 or twice the gross gain or gross loss from the offense. 

 

Principal Deputy Assistant Attorney General Readler and U.S. Attorney Minkler commended the FDA Office of Criminal Investigations, which conducted the investigation.  Trial Attorney David A. Frank of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Cindy J. Cho, of the U.S. Attorney’s Office for the Southern District of Indiana, are prosecuting the case. 

 

For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch.  For more information about the U.S. Attorney’s Office for the Southern District of Indiana visit its website at https://www.justice.gov/usao-sdin.

26 INDIVIDUALS FACE A VARIETY OF DRUG-RELATED CHARGES

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler today announced federal criminal charges against 26 individuals reaching from Indianapolis to Phoenix, Arizona, one of which is Richard Grundy III.

“Drug dealing fuels violence and the addiction epidemic our community faces each and every day,” said Minkler.  “My goal is to make Indianapolis the most inhospitable place in the country to sell illegal drugs.  Violent criminals who conduct criminal activity in and around Indianapolis will feel the full force of federal law enforcement.”

Agents and officers from a number of agencies served arrest and search warrants at 24 locations in Indianapolis and Phoenix, Arizona last Friday ultimately arresting 21 individuals.  During the investigation approximately 30 firearms, $100,000 in currency, and quantities of heroin, methamphetamine, marijuana, and prescription drugs were seized.

Those charged include:

Richard B. Grundy, III, 28, a/k/a White Boy, Indianapolis

Ezell Neville, 39, a/k/a Bo, Indianapolis

Gilberto Vizcarra-Millan, 31, Phoenix, AZ *

Mario Eduado Villasenor, 34, Phoenix, AZ

Emilio Mitchell, II, 40, a/k/a Loaf, Indianapolis *

Emilio Mitchell, Jr., 23, Indianapolis *

Lance L. Hatcher, Jr., 33, a/k/a Mont Mont, Indianapolis

Thomas Bullock, 19, Indianapolis

Dion G. Madison, 31, a/k/a D, Indianapolis

Frank S. Early, 22, Indianapolis *

Frankie B. Ray, 29, a/k/a Fresh, Indianapolis

Christopher D. Bradford, 24, Indianapolis

Daona Le’Ann Gholston, 19, Indianapolis

David C. Carroll, 35, Indianapolis

Michael Hyatte, 47, Indianapolis

Nathaniel Dixson, 33, a/k/a Dog, Indianapolis

Derek Atwater, 31, a/k/a Shorty, Indianapolis

Robert Lisenby, Jr., 32, a/k/a Russ, Indianapolis

Torin A. Harris, 31, Indianapolis

John E. Bell, 51, Indianapolis

Shemilah D. Crowe, 37, Indianapolis

James O. Beasley, 37, a/k/a Jake, Indianapolis

Dejuan Love, 41, Indianapolis *

Larry Ayres, 37, Indianapolis

Clinton Carter, 39, Indianapolis

Brandon Hudson, 27, Indianapolis

* remains a fugitive – pictures attached

According to the indictment, Richard B. Grundy, III, was the alleged leader of a drug trafficking organization that operated in Indianapolis.  Grundy and other individuals, including Ezell Neville and David Carroll, pooled their money to obtain methamphetamine from sources in the Phoenix, Arizona area.  The methamphetamine was then transported to Indianapolis, stored in “stash houses” for the Grundy organization and later distributed.

According to the indictment, throughout the conspiracy the defendants allegedly possessed firearms to safeguard members of the organization, as well as their controlled substances and drug proceeds.  Further, they used telephones using code language to discuss their drug trafficking operation.

 This case was investigated by the Federal Bureau of Investigation, Drug Enforcement Administration, Bureau of Alcohol, Tobacco and Firearms, Indianapolis Metropolitan Police Department, Fishers Police Department, the Marion County Sheriff’s Department, and the Indiana State Police.

“The FBI is uniquely positioned to target transnational criminal enterprises like this that use violence in the commission of their illegal activities,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division.  “Working collaboratively with our federal, state, and local partners we are able to disrupt and dismantle these groups so they can no longer terrorize our communities.”

“Violent drug trafficking organizations are a top priority for the DEA, and we stand united with our federal, state, and local partners to protect our communities and preserve the rule of law,” said Greg Westfall, DEA Assistant Special Agent Charge. 

"We do not accept violence as the norm in our cities and streets," said Trevor Velinor, ATF Special Agent in Charge.  "We will continue our efforts towards a safer reality for all our residents.  I recognize the committed efforts of our law enforcement partners for their cooperation and hard work to bring these individuals to justice.  I would also like to thank the citizens of Indianapolis who support our collective efforts to ensure a safer community for all of us."

“The Citizens of Indianapolis have a fundamental right not to live in fear.  On Friday our Federal, State, and local partners executed simultaneous warrants in an effort to remove those believed to be responsible for significant violence and pain in our community,” said Chief Roach. “Today’s announcement sends a clear message that law enforcement, and our community, will not waiver on efforts to identify and hold accountable those believed to be responsible for committing violent acts.  I am grateful for the cooperative effort and continued focus on making Indianapolis a safer community.”

“We continue to see the results of collaboration among federal, state, and county agencies in this investigation.  We appreciate the multi-agency cooperation aimed at pursuing those individuals who perpetuate the violence which compromises the safety of our community,” Marion County Prosecutor Terry Curry said.  “In addition to the new federal charges, many of these individuals may now also face additional penalties related to their prior state felony convictions.”

According to Drug and Violent Drug Chief Bradley A. Blackington, most of the defendants face up to life imprisonment if convicted.

An indictment is merely a charge and not evidence of guilt.  All defendant are considered innocent until proven guilty in federal court.  

 

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Found guilty of civil rights violations, now looks at additional prison time

PRESS RELEASE

Terre Haute – United States Attorney Josh Minkler today announced the resentencing of a former Putnam County deputy who was found guilty of two counts of deprivation of civil rights under the color of law.

“Our primary goal in prosecuting and resentencing TJ Smith was that he be treated fairly.  Simply put, TJ Smith should not receive favorable treatment from the criminal justice system because of his status as a law enforcement officer or his political connections in Putnam County.  We are confident that the federal law was fairly enforced in this case and that Judge Magnus-Stinson’s sentence of 33 months makes that message crystal clear.”

Smith was found guilty at a jury trial in September 2014, for his role in using excessive force when arresting two individuals in Greencastle Indiana. He was sentenced by Judge William T. Lawrence in December, 2014 to 14 months’ imprisonment. The U.S. Attorney’s Office for the Southern District of Indiana appealed the sentenced to the Seventh Circuit Court of Appeal in Chicago arguing that the sentence was unreasonably low. The Seventh Circuit remanded the case to the District Court for resentencing. The case was reassigned to Judge Jane Magnus-Stinson who sentenced Smith to 33 months.   

The case was prosecuted by Drug and Violent Crime Chief Bradley A. Blackington and Assistant United States Attorney MaryAnn T. Mindrum.

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PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler today announced the sentencing of a woman for her role in a diabolical plot to murder a Hamilton County victim. Renee S. Perillo, 54, Glendale, California was sentenced to 27 years’ imprisonment today in federal court by U.S. District Judge Richard L. Young.

“This devious plot to murder and kidnap a victim is beyond any logical comprehension,” said Minkler. “Ms. Perillo will have many many years in the Department of Corrections to think about her actions.”

Perillo plead guilty to conspiracy to commit kidnapping and murder for hire in May 2017. According to court documents, on May 22, 2015, the Hamilton County Sheriff’s Office responded to a call for service at a residence in Noblesville. When officers arrived, they found Renee Perillo and her son Richard lying in wait in the back seat of the victim’s vehicle along with a syringe of paralytic and a firearm. Her motive was to keep the victim from pursuing legal remedies against her boyfriend.

Perillo also utilized the U.S. mail in September 2015, to send an envelope, which contained a letter to an undercover FBI agent posing as a “hitman.” In her letter, she suggested to the hitman that the victim be killed at an ATM machine to make it look like a robbery.

According to Assistant United States Attorney Bradley Shepard, Perillo must also serve five years of supervised release following her sentence.

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PRESS RELEASE

Evansville – United States Attorney Josh Minkler today announced federal criminal charges against 14 individuals for their role in a large-scale methamphetamine trafficking ring.

“Drug dealing fuels much of the violence that plagues many of our communities,” said Minkler. “My goal is to make Evansville one of the most inhospitable places in the country to sell illegal drugs.  Those who do sell illegal drugs will face the full force of federal prosecution.”

Those charged include:

Mark Dow, Jr. 37, Owensboro, Kentucky

Tommy Howard, 42, Evansville

Andrea Maddox, 37, Evansville

Derricus Gilbert, 34, Tell City

Noel Henry, 42, Evansville

William Brown 33, Evansville

Kelly Damien, 33 Evansville

Tashiya Sanabria, 38, Evansville

Charles Redwine, 33, Evansville

Richard Mayo, Jr. 37, Evansville

Robert Howard, 45, Evansville

Bobby Hunter, 37, Evansville

Melinda Sigers, 33, Evansville

Shampayne Brown, 22, Evansville

All individuals are in the custody of the U.S. Marshal Service except Tashiya Sanabria who remains a fugitive.

From October 2016 until November 13, 2017, it is alleged that Tommy Howard and Andrea Maddox were the leaders and supervisors of a conspiracy to distribute and possess large quantities of methamphetamine in the Evansville area. T. Howard and Maddox would obtain their methamphetamine from their source of supply who was Mark Dow, Jr. - his sources were in Arizona and California.

Once the methamphetamine was transported to Evansville, it was redistributed to mid-level dealers who sold the drug throughout Southern Indiana and Northern Kentucky. Members of the conspiracy distributed the methamphetamine on a “front” providing quantities of the drug on a consignment basis, meaning it was paid for after the sale.  It is further alleged that the conspirators used cellphones and talked in code language using text messages to discuss matters related to the trafficking operation.

During the course of the investigation, law enforcement agents seized 13 pounds of methamphetamine, 10 pounds of marijuana, $120,000 in United States currency, and two firearms.

This case was investigated by the Drug Enforcement Administration, Bureau of Alcohol Tobacco and Firearms, the United States Marshal Service, the Evansville Vanderburgh County Drug Task Force, the Tell City Police Department, the Owensboro Police Department, the Henderson Police Department and the Kentucky State Police.

 “Unfortunately, with drugs, also comes violence and addiction, said DEA Assistant Special Agent in Charge Greg Westfall.” “The message is clear, the DEA and our law enforcement partners will continue to utilize all the resources available to target those criminals who are responsible for the distribution of drugs poisoning the Evansville Community.”

“The Evansville Vanderburgh County Drug Task Force will continue to work diligently with our Federal law enforcement partners to ensure our community and our citizens remain safe,” said Evansville Police Chief Billy Bolin.  “This investigation and the resulting arrests are examples of our ongoing commitment to address the problem of drugs in our community.”

According to Assistant United States Attorney Lauren M. Wheatley who is prosecuting this case for the government, all defendants face up to 20 years imprisonment if convicted.

An indictment is merely a charge and not evidence of guilt. All defendant are considered innocent until proven guilty in federal court.  

 

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Robbery team terrorized stores around the Midwest.

PRESS RELEASE

New Albany – United States Attorney Josh J. Minkler announced today the sentencing of two men convicted of robbing cell phone stores in the Midwest. Jeffrey A. Kemp, 41, Dolton, Illinois, was sentenced to 384 months (32 years) and Lawrence D. Adkinson, 28, Hazel Crest, Illinois, was sentenced to 346 months (over 28 years) before U. S. District Judge Tanya Walton Pratt. The defendants were found guilty at a jury trial in August 2017, of conspiracy to commit robbery, conspiracy to brandish a firearm in furtherance of a crime of violence, robbery, and brandishing a firearm in furtherance of a crime of violence.

“This group used violence to terrorize retail store employees around the Midwest,” said Minkler. “Putting the safety of shoppers, employees and law enforcement in jeopardy will never be tolerated. They will many years in the Bureau of Prisons to contemplate their actions.”

The investigation began when a T-Mobile store in Clarksville, Indiana, and a Verizon store in Lexington, Kentucky, were robbed at gun point on successive days in July 2015. The investigation led by the FBI and a coalition of state and local law enforcement agencies and offices determined that Kemp and Adkinson led a group of ten men who committed armed robberies of cell phone retailers in various cities and towns in Illinois, including Orland Park, Joliet, Bloomington, Batavia, and DeKalb, and in St. Louis, Missouri, and Waterloo, Iowa, in addition to those in Clarksville, Indiana, and Lexington, Kentucky.  The defendants were ultimately arrested in Iowa, while still in possession of phones stolen from many of the other locations.

The robberies were violent in nature. The robbers often held firearms to the faces of the victims before ultimately restraining them in the back rooms of the retail stores.  Kemp and Adkinson, as the leaders of the group, provided all the vehicles, guns, and other instrumentalities of the robberies, selected all of the stores to be robbed, and decided who would rob each store. The other eight defendants have all pled guilty for their roles in the offenses.

"This sentencing is a testament to the dedication of our agents and our partners whose hard work on this investigation ensured this group is no longer a threat to the community," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division

According to Assistant United States Attorneys Bradley Shepard and Pamela Domash who prosecuted this case for the government, both defendants face 3 years of supervised release after serving their sentences.

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Sentenced to 36 months’ imprisonment following scourge of identity theft

PRESS RELEASE

Indianapolis – Josh J. Minkler, the United States Attorney, announced today a 36 month sentence of imprisonment for defendant Selina Norman, 35, following her guilty pleas to bank fraud, possession of stolen mail, and aggravated identity theft.  She was sentenced by U.S. District Judge William T. Lawrence.  The matter was investigated jointly by the U.S. Postal Inspection Service and the Cumberland Police Department with assistance from security officers employed by commercial establishments in the district affected by the charged activity.

Norman was apprehended in January 2017, and later charged following an investigation that unearthed a scourge of identity theft activity.  She stole checks from the U.S. mail, edited the checks and cashed them at various commercial entities to purchase gift cards.  Recently, United States Attorney Josh J. Minkler announced the priorities for the U.S. Attorney’s Office in the Southern District of Indiana to include aggressively prosecuting identity thieves and fraudsters whose criminal conduct often affect innocent citizens for years. 

“Identity Theft strips innocent citizens of tangible and intangible securities.  This criminal activity and the individuals who chose to partake will be aggressively pursued in this district and across the country in an effort to address this national epidemic,” said Minkler.

According to Assistant U.S. Attorney Cynthia J. Ridgeway who prosecuted this case for the government, Norman must serve three years of supervised release after her sentence.

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Alleged to have trafficked heroin and methamphetamine in Indianapolis area

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler today announced federal criminal charges against four individuals who are accused of distributing large quantities of heroin and methamphetamine in the Indianapolis area.

“Drug dealing fuels violence and the addiction epidemic our community faces each and every day,” said Minkler. “My goal is to make Indianapolis the most inhospitable place in the country to sell illegal drugs.”

Those arrested included:

 Gary Sellers, 43, Richmond, Indiana

       Richard Roberson, 39, Indianapolis

       Leroy Thomas, 45, Indianapolis

       Ali Abdul Salam, 40, Indianapolis

Beginning this summer and continuing until October 11, 2017, the defendants are alleged to have brought large quantities of heroin and methamphetamine into the Indianapolis area for redistribution. They have all been arrested and remain in the custody of the U.S. Marshal Service.

As a result of their arrests, agents and officers confiscated $7,000 in seized drugs including two ounces of fentanyl-laced heroin, prescription pills, one vehicle with a hidden compartment and three firearms.

This case was investigated by the Drug Enforcement Administration, Internal Revenue Service, FBI, ATF, Homeland Security Investigations, United States Postal Inspection Service, Kokomo Police Department, Fishers Police Department, Indianapolis Metro Drug Task Force, Hamilton-Boone County Drug Task Force, Hendricks County Sheriff’s Department, Richmond Police Department and the Indianapolis Metropolitan Police Department.  

“DEA and our law enforcement partners will continue to investigate those individuals who are responsible for trafficking poison such as heroin and fentanyl in our communities.” said Drug Enforcement Assistant Agent in Charge Greg Westfall. “Unfortunately, both leave a trail of violence and addiction.”

“The epidemic of illegal narcotics has a debilitating effect on individuals, families, and communities,” said Chief Roach. “Local, state, and federal efforts to undermine and disrupt networks that provide illegal narcotics is key to reducing violent crime in our community, and will remain a top priority of IMPD and our law enforcement partners.”

IRS Criminal Investigation Special Agent in Charge, Gabriel Grchan stated, “Stopping organized crime is a priority for IRS Criminal Investigation.  IRS special agents will continue to support our law enforcement partners in that effort.”

According to Assistant United States Attorney Michelle P. Brady who is prosecuting this case for the government, Sellers, Roberson and Thomas face up to life in prison if convicted, Abdul Salam faces up to 20 years imprisonment if convicted.

Criminal charges are merely allegations and are not evidence of guilt. All defendants are considered innocent until proven guilty in federal court.  

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Alleged to have stolen millions from clients

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler today announced federal criminal charges against a Carmel, Indiana, financial advisor for defrauding clients by charging excessive commissions.  Thomas. J. Buck, 63, was charged in federal court with one count of securities fraud following an in-depth investigation by the FBI. Buck has agreed to plead guilty to the charge.

“Financial investors have a right to feel secure when entrusting oftentimes the bulk of their  life’s savings to a financial advisor that the advisor will do no harm,” said Minkler.  “The government worked steadfast together with its investigative FBI agents and analysts, Merrill Lynch (the defendant’s former employer), and individual investors to understand the full scope of defendant Thomas Buck’s fraud scheme.  This criminal charge represents a significant undertaking representative of the type of work the citizens of this district expect, demand, and deserve.”

For over 30 years, Buck was a registered financial advisor with global investment firm Merrill Lynch, Pierce, Fenner & Smith, now a division of Bank America (Merrill Lynch), Buck counseled thousands of clients on their investments and money management. 

The criminal charges unsealed today allege that, in recent years, Buck defrauded some clients by charging excessive commissions and intentionally failing to advise them of cheaper pricing options for his services.  Specifically, it is alleged that Buck took discretion on certain client accounts, placing trades without client authorization, which resulted in clients paying commissions on these trades.  But Buck allegedly told clients they were paying less in commissions than they actually were.  Then, it is alleged that Buck intentionally failed to inform certain clients that a fee-based payment structure was available which could result in financial savings to the client, although Buck repeatedly informed Merrill Lynch compliance personnel that he had made the clients aware of the potentially cheaper pricing structure.

As a result of Buck’s fraud, it is alleged that Buck’s criminal activity caused clients to suffer a total loss of $2 million. 

“These are not victimless crimes.  These are crimes that can wipe out a family’s life savings and leave their financial future in ruins,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division.  “That’s why the partnerships the FBI has with agencies such as the Securities and Exchange Commission are important to ensuring a stop is put to unauthorized and illegal activities.”  

According to Assistant United States Attorneys Cynthia J. Ridgeway and Nick Linder, who are prosecuting this case for the government, Buck has agreed to plead guilty to the securities fraud change and could face up to 25 years’ imprisonment if convicted.

Contemporaneous to the unsealing of the criminal charge and Buck’s agreement related thereto, Buck has also agreed to settle with the Securities and Exchange Commission and pay approximately $5 million as part of that civil settlement.

Buck will have an initial appearance today, at 2pm in Room 243, U.S. Federal Courthouse.

Individual investors who believe they are victims of the specific fraud scheme described in this case are directed to the government’s public website at https://www.justice.gov/usao-sdin for more information pursuant to the Crime Victims’ Rights Act, 18 U.S.C. § 3771.

Criminal charges are merely allegations and are not evidence of guilt.  The defendant is considered innocent until proven guilty in federal court.  

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Alleged to have enticed 14 to 17 year old boys to send him sexually explicit images

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today that a Crawfordsville, Indiana, man has been charged by an Information with 15 counts of sexual exploitation of a minor. Drew W. Sutherlin, 27, is alleged to have enticed boys between the ages of 14 and 17 years old to send him sexually explicit images of themselves over the Internet.

“Sexual predators cannot be allowed to take advantage of those most vulnerable in our communities,” said Minkler. “Anyone who takes advantage of our youth will be held strictly accountable and will pay a price for their criminal actions.”

According to the Information, from January 2015 until May 2017, Sutherlin posed as a female on the Internet. While posing as a female, Sutherlin sent pornographic images of an actual woman to several boys asking for sexually explicit images of themselves.

Believing they were corresponding with an actual female, the 15 victims sent sexually explicit images of themselves by using the camera on their cell phones. They would then send the images over the Internet to Sutherlin for him to view.

This case was investigated by the Montgomery County Sheriff’s Department, the Federal Bureau of Investigation the Indianapolis Metropolitan Police Department and the Indiana Internet Crimes Against Children Task Force.  

“The Montgomery County Sheriff’s Department was proud to work with the our law enforcement partners to help uncover over 14,000 pages of text messages and 17,000 images, the majority of which were sexually explicit in this investigation,” said Montgomery County Sheriff Mark Casteel. “We would like to thank the Montgomery County Prosecutor’s Office, Indianapolis Metropolitan Police Department Cyber Unit, Indiana State Police Internet Crimes Against Children Task Force, Federal Bureau of Investigation and the U.S. Attorney’s Office for their invaluable expertise and assistance in this investigation.”

“Today’s charges are an illustration of law enforcement’s commitment to protect our communities’ most vulnerable citizens, our children” said FBI Indianapolis Special Agent in Charge W. Jay Abbott. “The FBI will continue to diligently work with our local, state, and federal partners to identify and prosecute child predators.”

“IMPD is proud to lend our detective expertise to assist our federal, state and local law enforcement partners chase down sexual predators,” said Chief Roach. “IMPD will continue to provide assistance to investigations involving children so that we protect them to the best of our abilities.”

Sutherlin has signed a plea agreement notifying the Court of his intention to plead guilty. No future court date has been set.

According to Senior Litigation Counsel Steven D. DeBrota, who is prosecuting this case for the government, Sutherlin faces up to 35 years imprisonment and a minimum of five years of supervised release if convicted.

Discussed civil laws that protect the rights of military personnel

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler and his staff recently visited with members of the military community at Camp Atterbury to discuss their legal rights while serving our country.

“Military personnel deserve the chance to serve their country without needless distractions and unnecessary stressors,” said Minkler. “While they serve our country, it is our job to protect their rights against unscrupulous housing and financial practices, to protect their right to civilian employment after military service and to fight against those who would violate those rights.”

Minkler discussed three federal civil rights statutes–the Uniformed Services Employment and Reemployment Rights Act, Servicemembers Civil Relief Act and the Uniformed and Overseas Citizens Absentee Voting Act.  Each statute protects service members from financial burden, employment discrimination and voting violations while they are in military service.  

Minkler was joined at Atterbury by Tanya Kirwan and Andrew Braniff who currently serve as Assistant Directors of the Justice Department’s Servicemembers and Veterans Initiative (SVI). SVI coordinates with DOJ components and federal agencies to build comprehensive legal support and protection network focused on service members, veterans and their families.

According to Assistant United States Attorney Kelly Rota, the Southern District of Indiana’s lead attorney on civil rights issues, over 900,000 Hoosier Guard and Reservists have served since September 11, 2001, and protecting their rights is a top civil rights goal of the US Attorney’s Office.

More information about legal protections available to service members can be found at   www.servicemembers.gov. 

 

 

 

Stole more than $80,000 from Vigo County taxpayers

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler announced today the sentencing of a former Vigo County sheriff’s deputy for his role in a fraud scheme in which he stole more than $80,000 in Vigo County School Corporation (VCSC) money. Frank Shahadey, 61, Terre Haute, was sentenced to 16 months’ imprisonment by U.S. Chief District Judge Jane Magnus-Stinson after pleading guilty to wire fraud and theft of government funds.

 “Public officials are supposed to serve the public, and not the other way around,” said Minkler. “When police officers believe they are above the law they were sworn to uphold, this office will hold them accountable.”

Shahadey was a Vigo County Sheriff’s deputy who also worked part time for the VCSC as a school security officer. From April 2014 through October 2016, Shahadey and a co-defendant instructed a Terre Haute area business to submit false and fraudulent invoices for work performed for the VCSC.  He further directed an individual to falsify work estimates and invoices either by inflating the cost of the work, or by seeking payment for the work that was either not performed, or was done by another business.

As a result of Shahadey’s fraud scheme, Shahadey received kickbacks of more than $80,000.

This case was investigated by the Federal Bureau of Investigation.   

 “When a law enforcement officer chooses to violate their oath of office and commit crimes, their actions erode public trust and confidence and tarnish the entire community of dedicated public servants,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. “This sentence highlights that the FBI considers public corruption a top criminal priority and our agents will continue to work diligently to pursue those whose greed outweighs their vow to serve and protect."

According to Assistant United States Attorney Tiffany J. Preston who prosecuted this case for the government, Shahadey must serve two years of supervised release following his sentence. 

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Westside organization responsible for distributing kilograms of heroin and methamphetamine to Indianapolis neighborhoods.

PRESS RELEASE

Indianapolis – United States Attorney Josh Minkler announced today the sentencing of the leader of a drug trafficking organization which distributed heroin and methamphetamine in the Indianapolis area. David McMichel, 33, Indianapolis was sentenced to 360 months (30 years) imprisonment by U.S. District Judge Jane Magnus-Stinson.

“McMichel is the face of organized crime today. The defendants in this criminal organization were some of the most violent in Indianapolis,” said Minkler. “Not only did they sell large quantities of narcotics but most had prior felony convictions, possessed and used firearms and threatened acts of violence in furtherance of their crimes.”

Beginning in December 2014 through August 2015, David McMichel, a/k/a White Boy, a/k/a David Webster ran a drug trafficking organization from his home on the Westside of Indianapolis. The McMichel Drug Trafficking Organization (MDTO) moved large quantities of heroin and methamphetamine from suppliers in Arizona to Indianapolis, Fort Wayne and other locations. The MDTO obtained most of its drug supply from Fernando Vaca-Mata, 32, and Jose Prieto, 33, to be redistributed to lower level dealers.

As leader of the MDTO, McMichel negotiated with suppliers to obtain pound quantities of the narcotics. Further, he distributed and supervised the delivery of the narcotics and acquisition of weapons, collected proceeds from the narcotics sales and arranged to store the narcotics in stash houses around Indianapolis.

Throughout the months’-long investigation, McMichel ran the MDTO from his home while on house arrest serving a sentence for his third felony conviction. McMichel was overheard on a wiretap ordering shootings of his enemies. He stated he had a “list a block long” of individuals he wanted dead. Members of the MDTO obtained photographs from Facebook of some of his intended targets. During the investigation, law enforcement arrested one of McMichel’s “hitmen” in possession of a firearm and a photograph of an intended target.

During arrest and search warrant execution, law enforcement confiscated 19 firearms, $160,000 in cash and several pounds of heroin as well as large quantities of methamphetamine. Also recovered were two ballistic vests.

primary mission of the Drug Enforcement Administration is to identify, dismantle, and bring to justice drug-trafficking organizations who poison our streets with illegal drugs and contribute to the violence in our communities. Sentencing such as today should send a clear message and serve as a deterrent, the DEA and its law enforcement partners will continue to utilize all resources to bring you to justice. So, shame on you if you continue to violate the drug laws of the United States, you’re next,” said DEA Assistant Special Agent in Charge Greg Westfall.

“Illegal drugs and the associated violence that often follows continues to plague many of our communities at unacceptable rates,” said Chief Roach. “Through a decentralized enforcement approach and information sharing with our Federal, State, and Local law enforcement partners we continue to disrupt criminal organizations that negatively impact the quality of life for so many in the Indianapolis community.”

This case was jointly investigated by the Drug Enforcement Administration, Hamilton-Boone County Drug Task Force, Bureau of Alcohol Tobacco Firearms and Explosives, Indianapolis Metropolitan Police Department, Metro Drug Task Force and the Marion County Prosecutor’s Office.

According to Assistant United States Attorney Jeffrey D. Preston who is prosecuting this case for the government, McMichael must serve five years of supervised release following his prison sentence.

Groomed aspiring young artists to send him explicit images

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today the sentencing of an Indianapolis man for his role in enticing two teen-aged girls to produce and send sexually explicit images. Jefferson Darin Smith, 37, Indianapolis, was sentenced to 408 months (34 years) of imprisonment by U.S. District Judge Tanya Walton Pratt. In 2012, Smith pleaded guilty to Criminal Attempted Sexual Assault of a Child in Colorado. In that case, Smith attempted to have sexual contact with a 14-year-old child who he met on a website where artists and art enthusiasts collaborate.

Less than a year after Smith completed probation on the Colorado case, and using the same website from his previous case, Smith began online conversations with a 14-year-old artist from South Dakota. Smith claimed to be a professional photographer and attempted to get the child to send nude images of herself to him. Smith told the child that he was going to come to her town and that he would “cuddle the heck out of her.” Smith was able to convince this child to send some images to him; however, before he could receive explicit images, the child’s parents intercepted the communication and told Smith that they were going to notify the police.

Smith also communicated with a 15-year-old aspiring artist from California on this same website. This child posted images of her art as well as a profile photo of herself on the site. Smith initiated communication with the child, again posing as a professional photographer. Over a two-month period, the two exchanged online communications. Smith told the child that he loved her, that she was beautiful and that she was his girlfriend. Smith enticed and coerced the child to send sexually explicit photos of herself, knowing that she was 15 years old, and she eventually complied. The communication ended when the child’s parents discovered the images and notified the police.

“While the Internet offers children the chance to advance and explore their talents, sadly, it also offers predators a hunting ground, where they will exploit the innocence and trust of these same children. When adults make the decision to manipulate, abuse, and sexually exploit children online, they should know this: we will investigate you, prosecute you, convict you and send you to federal prison for a very long time.” said Minkler.

This case was investigated by FBI, IMPD, Los Angeles County Sheriff’s Department and South Dakota Division of Criminal Investigation.

"I am proud of the dedicated work and swift action of our agents and task force officers, as well as our law enforcement partners in California and South Dakota. This speaks to the phenomenal teamwork that exists between the FBI and our partner organizations, even across state lines," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division.

"Protecting our children will remain an important effort of enforcement for IMPD," said Chief Roach. "Individuals who prey on the most innocent and vulnerable, our children, we are confident will be held accountable for their actions."

According to Assistant United States Attorney Kristina Korobov who prosecuted this case for the government, Smith must serve 15 years of supervised release following his prison term.

Alleged to have extorted and made death threats to minor victims around the country-Victims are urged to contact law enforcement if threats were made

PRESS RELEASE

Indianapolis –A Bakersfield, California, man was recently charged in the Southern District of Indiana for making cyber threats to young woman in a suburb of Indianapolis. He is also believed to have made similar threats to other teenagers around the country in as many as ten states, including Maine. Buster Hernandez, 26, a/k/a Brian Kil, a/k/a Purge of Maine, was charged with threats to use an explosive device, threats to injure and sexual exploitation of a child.

“Terrorizing young victims through the use of social media and hiding behind the anonymity of the Internet will not be tolerated by this office,” said Minkler. “Those who think they can outwit law enforcement and are above being caught should think again. Mr. Hernandez’s reign of terror is over.”

According to court documents, the Brownsburg Police Department contacted the FBI in December 2015, asking for assistance with a cyber-threat case involving a minor female victim (Victim 1), a resident of Plainfield Indiana. The threats came from a person known only at the time as “Brian Kil” who used Facebook to communicate with Victim 1 to extort sexually explicit pictures from her. This pattern continued for approximately 16 months with Victim 1 sending sexually explicit images of herself under threat by “Brian Kil.” This technique is commonly referred to as “sextortion.”

When Victim 1 refused to provide additional images as demanded, Hernandez is alleged to have made physical threats to Victim 1, stating “I am coming for you. I will slaughter your entire class and save you for last.” He further made threats to law enforcement saying, “I will add a dozen dead police to my tally…Try me pigs, I will finish you off as well.” These threats caused school administrators to close the Plainfield and Danville High Schools. The Shops at Perry Crossing in Plainfield was also closed December 19, 2015, but reopened the following day after law enforcement insured there were no credible threats.

Hernandez is also alleged to have sexually exploited and threatened two other minor victims (Victims 2 and 3). When Victim 2 stopped complying with Hernandez’s demands, he posted sexually explicit images and videos of Victim 2 that she sent to Hernandez against her will. According to the complaint affidavit, Hernandez asked Victim 3 to attend a community forum held in Plainfield, Indiana, and record law enforcement’s statements about the investigation into “Brian Kil.”

In addition, Hernandez is alleged to have “sextorted” a number of victims in at least 10 federal districts.

“This was a unique and complex investigation that highlights the tenacity, perseverance, expertise and dedication of the FBI Indianapolis’ Crimes Against Children Task Force and was a top priority. Innovative techniques were utilized, solutions to roadblocks created and partnerships with key private sector partners were developed,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. “I stood in front of concerned parents and community members and told them we would find the person who had been victimizing these young girls and, with the tireless work of our agents and partners, we never gave up.”

Hernandez had his initial appearance in the Eastern District of California on Friday, August 4, 2017. He will appeared before a magistrate judge in Indianapolis at 3pm Wednesday, Aug 30, 2017.

This investigation was jointly conducted by the Federal Bureau of Investigation, the Indiana State Police, the Plainfield Police Department and the Brownsburg Police Department.

Indiana State Police Superintendent Doug Carter said, “I have no doubt Buster Hernandez had forgotten all about Plainfield, Indiana and the terror he inflicted; but none of us here forgot.” Carter concluded, “We said we’d keep looking until we found you, and we did.”

According to Assistant United States Attorney Tiffany J. Preston who is prosecuting this case for the government, Hernandez faces a mandatory minimum sentence of 15 years’ imprisonment, and a maximum of 30 years’ imprisonment if convicted on all counts.

A criminal complaint is merely a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.

If you believe you have been a victim of sextortion by Buster Hernandez, a/k/a Brian Kil, a/k/a Purge of Maine, please contact the Indianapolis FBI Office at https://tips.fbi.gov/ or call 317-595-4000, Option 2, to make a report.

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Sold hundreds of kilograms of heroin and cocaine in Indianapolis area

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today that an Indianapolis man was sentenced to 360 months (30 years) imprisonment for his role in selling large quantities of narcotics in Indianapolis neighborhoods. Geraldo Colon, 48, was sentenced by U.S. District Judge Jane Magnus-Stinson after being convicted at a jury trial in April 2017, of drug distribution, money laundering and bankruptcy fraud charges.

“The goal of this office is to make the Southern District of Indiana the worst place in America to sell drugs,” said Minkler. “That is accomplished by investigations like this in which drug dealers are detained without bond, convicted at trial and sent to federal prison for a very long time.”

In May 2014, law enforcement officials learned that large quantities of narcotics were being shipped to the Indianapolis area from Phoenix, Arizona. The drugs were being shipped to a location on Bomar Lane in Greenwood, Indiana. From there, the drugs were being moved to the Muebleria Luz Furniture Store on the Northwest side of Indianapolis, where Colon then distributed them to various Indianapolis-based drug traffickers.

Law enforcement soon learned that Colon was the ringleader of this drug trafficking organization, which brought hundreds of pounds of heroin, cocaine and methamphetamine to the Indianapolis area. Various search warrants were served during the investigation netting: 24 firearms, over $4.5 million in cash proceeds, along with 9.5 kilograms of heroin, over 21 kilograms of cocaine and 22 kilograms of methamphetamine.

Colon was one of 20 federal defendants charged as part of Operation Family Ties that targeted a well-armed and heavily funded drug trafficking organization. A large portion of the drugs were being distributed in the Northwest side of Indianapolis as well as the Butler-Tarkington Neighborhood. Two other primary distributors in the “Family Ties” investigation have been sentenced. Daniel Stewart was sentenced to life without parole in November 2016 and Wade Havvard was sentenced to 31 years in May 2016.

“The negative impact this organization had on the lives and families of Indianapolis is unmeasurable, yet devastating,” said IMPD Chief Bryan Roach. “I am thankful for the good work and passion all the detectives working in collaboration with our federal partners who continue to pursue these types of crimes and criminals to change lives and make Indianapolis a safer place.”

"The investigation of Colon not only shut down a major source of narcotics to the Indianapolis area, but disrupted the flow of drug proceeds through financial systems,” said Gabriel Grchan, IRS Criminal Investigation Special Agent in Charge. “As shown in this investigation, criminals can expect that IRS special agents will expose illicit financial activity that is concealed within legitimate and fictitious businesses. I am proud of the efforts of this investigation as it demonstrates the tremendous work achieved when law enforcement agencies partner together to protect our communities‎.”

“Concealing income and assets in a bankruptcy proceeding is a crime,” stated Nancy J. Gargula, United States Trustee for Indiana, Central Illinois and Southern Illinois (Region 10). “We are grateful to all of our law enforcement partners in this case, and in particular to U.S. Attorney Minkler for his commitment to pursuing those who commit bankruptcy fraud and abuse the bankruptcy process for their own personal gain.” The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Ind., and Peoria, Ill

This case was investigated by the Indianapolis Metropolitan Police Department, Internal Revenue Service-Criminal Investigation, Drug Enforcement Administration, Department of Homeland Security Investigations, and the U.S. Trustee’s Office.

According to Assistant U.S. Attorney Michelle P. Brady who prosecuted this case for the government, Colon must serve five years of supervised release following his lengthy sentence and pay a $5,000 fine.

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Unprecedented seizure of over 66 pounds of methamphetamine confiscated, along with cocaine, heroin, fentanyl, marijuana and 17 firearms

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today the dismantling of a drug trafficking organization that brought unprecedented quantities of illegal drugs into the Indianapolis community. Ten defendants were charged by a grand jury sitting in Indianapolis with conspiracy to possess with intent to distribute 500 grams or more of methamphetamine and cocaine.

“Drug trafficking organizations bring gun violence to our neighborhoods and take advantage of the addiction problem this community and our nation faces,” said Minkler. “This illegal activity will not be tolerated and those who deal drugs in Marion County will soon realize my commitment to help stop the flow of narcotics here. I want the Southern District of Indiana to be the most inhospitable place in the country to sell drugs.”

Those arrested include:

Brayan Quinonez, 23, Indianapolis

Nansi Juarez Robles, 42, Indianapolis

Lauro Parra, 41, Indianapolis

Dwayne Dodd, 40, Indianapolis

Ryan Baird, 33, Indianapolis

Charles Craft, 47, Indianapolis

Donald Bell, 38, Indianapolis

Cory Bailey, 40, Indianapolis

Curt Glass, 35, Fort Wayne

Michael Smith, 43, Indianapolis

According to the indictment, it is alleged that Quinonez was the source of supply for the drugs coming to Indianapolis. Quinonez shared a house in the 3100 Block of Ellen Drive with Juarez-Robles and her four children, where much of the redistribution of drugs took place. Quinonez, assisted on occasion by Juarez Robles, would front the drugs he received from the Southwest border to Parra and others who sold the drugs on consignment. Quinonez would receive his payment after the drugs were sold on the street. Parra, assisted by Ryan Baird, distributed cocaine to individuals such as Dwayne Dodd, and methamphetamine to individuals such as Charles Craft, Donald Bell, and Cory Bailey. Donald Bell, in turn, supplied individuals such as Curt Glass and Mike Smith.

During the investigation, law enforcement recovered over 66 pounds of methamphetamine, six pounds of cocaine, heroin, fentanyl, marijuana, $50,000 in cash and 17 firearms, some of which were assault-style weapons.

This case was investigated by the Federal Bureau of Investigation, the Indianapolis Metropolitan Police Department and the Marion County Sheriff’s Office.

"This illustrates the impact of law enforcement partnerships and how our combined resources can attack these criminal enterprises and remove dangerous offenders and the poison they peddle from the streets," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "No one in our community should have to live in fear of the activity in their neighborhoods from narcotics trafficking."

“Targeting illegal drug dealers will continue to be a collective focus of IMPD and our federal, state and local partners,” said Chief Bryan Roach. “These types of illegal drugs and the individuals who distribute them often degrade the quality of life for our community and bring with them unacceptable levels of violence.”

According to Assistant United States Attorneys Michelle P. Brady who is prosecuting this case for the government, all defendants face up to life in prison if convicted.

An indictment is only a charge and not evidence of guilt. All defendants are considered innocent until proven otherwise in federal court.

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Extensive criminal history including more than five felony convictions

PRESS RELEASE

Terre Haute – United States Attorney Josh J. Minkler announced today that a Terre Haute man was sentenced in federal court for illegally possessing a firearm. Andre Jackson, 57, Terre Haute, was sentenced to 210 months (over 17 years) imprisonment by U.S. District Judge William T. Lawrence.

“Protecting our neighborhoods from gun violence is one of the top priorities of my office,” said Minkler. “There is no tolerance for this type of violence and those who choose to violate our laws will be held accountable.”

On May 2, 2015, officers from the Terre Haute Police Department responded to a call of shots fired near Liberty Avenue and North 21st Street. Law enforcement officers arrived in the area and encountered an individual who had been shot in the leg. Other officers encountered Jackson. In a statement to police, Jackson stated he had been in an argument with the man and shot at him with his shotgun to prevent him from entering Jackson’s house. Officers located several spent shells in the yard, however, and they seized a .12-gauge shotgun in a trashcan adjacent to Jackson’s house.

Jackson is not legally permitted to own a firearm because he has more than five felony convictions, including convictions for crimes of violence, and is considered an armed career criminal under federal law. His convictions include residential burglary, two robberies, unlawful use of a weapon, and aggravated vehicular hijacking, all of which were from Cook County, Illinois. He was also convicted of strong-armed robbery in Vigo County for a 2010 incident, and he was on probation for that case at the time of his arrest for this incident.

This case was investigate d by the Terre Haute Police Department and the Federal Bureau of Investigation.

"This individual is a perfect example of why the law, illegal possession of a firearm by a prohibited person, was enacted," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "He is a career criminal with a long history of violence and this sentence ensures he is no longer a threat to the community."

According to Assistant United States Attorneys Matthew J. Lasher who prosecuted this case for the government, Jackson must serve five years of supervised release after his sentence.

Robbery team terrorized stores around the Midwest.

PRESS RELEASE

New Albany – United States Attorney Josh J. Minkler announced today a jury in New Albany, Indiana, convicted two Northern Illinois men for a series of cell phone store robberies. Jeffrey A. Kemp, 41, Dolton, Illinois, and Lawrence D Adkinson, 28, Hazel Crest, Illinois, were convicted in federal court before U. S. District Judge Tanya Walton Pratt for their roles as ringleaders of a group of armed robbers who wreaked havoc across the upper Midwest in the summer and fall of 2015. The defendants were convicted of conspiracy to commit robbery, conspiracy to brandish a firearm in furtherance of a crime of violence, robbery, and brandishing a firearm in furtherance of a crime of violence.

“This group used violence to terrorize retail store employees around the Midwest,” said Minkler. “Putting the safety of shoppers, employees and law enforcement in jeopardy will never be tolerated. They will now be held accountable.”

The investigation began when a T-Mobile store in Clarksville, Indiana, and a Verizon store in Lexington, Kentucky, were robbed at gun point on successive days in July 2015. The investigation led by the FBI and a coalition of state and local law enforcement agencies and offices determined that Kemp and Adkinson led a group of ten men who committed armed robberies of cell phone retailers in various cities and towns in Illinois, including Joliet, Bloomington, Batavia, and DeKalb, and in St. Louis, Missouri, and Waterloo, Iowa, in addition to those in Clarksville, Indiana, and Lexington, Kentucky. The defendants were ultimately arrested in Iowa, while still in possession of phones stolen from many of the other locations.

The robberies were violent in nature. The robbers often held firearms to the faces of the victims before ultimately restraining them in the back rooms of the retail stores. Kemp and Adkinson, as the leaders of the group, provided all the vehicles, guns, and other instrumentalities of the robberies, selected all of the stores to be robbed, and decided who would rob each store. The other eight defendants have all pled guilty for their roles in the offenses.

"These men victimized the Midwest over the course of four months, traumatizing employees who were simply trying to do their jobs and had no idea their 'customers' were really violent criminals out do to them harm," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "This conviction is a testament to the dedication of our agents and our partners whose hard work on this investigation ensured this group is no longer a threat to the community."

According to Assistant United States Attorneys Bradley Shepard and Pamela Domash who prosecuted this case for the government, both defendants face up to life in prison at sentencing. No sentencing date has been set by the court.

Leader of nation-wide heroin and cocaine distribution ring receives 188-month sentence.

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today the sentencing of an Indianapolis night club manager for conspiracy to distribute heroin and cocaine, distribution of heroin and cocaine, and conspiracy to commit money laundering. Pierre Burnett, Jr., 44, manager of Epic Ultra Lounge (formerly Tantrum), was sentenced to 188 months imprisonment by U.S. District Judge Tanya Walton Pratt in federal court.

“Gone are the days when criminals could cloak their drug trafficking activity behind the anonymity of the Dark Web,” Minkler said. “Our office is committed to ferreting out and prosecuting individuals engaged in cybercrime in all its many forms.”

What began as an investigation into drug trafficking on the Dark Web led to the ultimate arrest and conviction of Burnett, a/k/a “Doe,” the leader of a major heroin and cocaine distribution ring in the Indianapolis area and elsewhere. In October 2013, federal law enforcement agencies shut down the Dark Web site Silk Road. Through a joint investigation by Drug Enforcement Administration (DEA), U.S. Postal Inspection Service (USPIS), and Internal Revenue Service (IRS), law enforcement learned that Lee Gray, a Camby, Indiana, resident at the time, was selling heroin and cocaine in exchange for bitcoins on Silk Road, and later other Dark Web sites such as Black Bank. Gray shipped the drugs to customers located throughout the United States using the U.S. mail. Gray then laundered his bitcoins using foreign bitcoin-exchange companies to wire U.S. currency into multiple bank accounts in his own and other names. He also sold bitcoins on the Dark Web to other users in exchange for cash that the other users mailed to him.

Gray was indicted on July 7, 2015, and pleaded guilty on December 22, 2015, to conspiring to distribute heroin, possession with intent to distribute heroin, and money laundering. He will be sentenced on October 4, 2017, before U.S. District Judge Sarah Evans Barker.

Gray obtained his supply of heroin and cocaine from Burnett. From at least 2012 through August 18, 2015, Burnett obtained heroin and cocaine directly from a Mexican source of supply, and would pay the Mexican source by delivering large bags of money to Mexican couriers. Burnett distributed the drugs to drug distributers, including Gray and Alan Duncan (a/k/a “Al Gore”), another drug distributor in the Southern District of Ohio, who sold these drugs within and outside of their local communities. Gore received a sentence of 150 months imprisonment in Ohio. Burnett is responsible for distributing at least 17 kilograms of heroin and 25 kilograms of cocaine during the course of the conspiracy.

This case highlights the collaborative efforts by multiple organizations. This case was investigated by the Drug Enforcement Administration (DEA) Indianapolis Office, United States Postal Inspection Service (USPIS) and the Internal Revenue Service (IRS). The U.S. Attorney’s Office for the Southern District of Ohio and the DEA Dayton Office assisted in the investigation.

“DEA is committed to saving lives by identifying, disrupting and dismantling those criminal drug organizations who poison our communities with heroin and fentanyl,” said Greg Westfall DEA Assistant Special Agent in Charge. “DEA will exhaust all resources and work with our partners to bring those to justice who try and find ways to elude law enforcement detection to hide their criminal activities. Law enforcement and other partnerships working together will prevail.”

“The U.S. Postal Inspection Service takes very seriously its mission to deter the illegal use of the mails for any criminal activity,” said Acting Special Agent in Charge Cynthia Mormon, Detroit Division. “These crimes negatively impact each and every community and household, and we stand committed to working together to identify, investigate and bring to justice those who would attempt to mask their criminal activity through the use of the mail thereby violating the sanctity of the seal.”

According to Assistant United States Attorneys MaryAnn T. Mindrum and Cindy J. Cho, who prosecuted this case for the government, Burnett must serve five years of supervised release following completion of incarceration.

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PRESS CONFERENCE

INDIANAPOLIS-United States Attorney Josh Minkler will hold a press conference tomorrow, August 7, 2017, at 10am in the Plainfield Town Courtroom, 1075 W. Main Street, Plainfield, Indiana.

Minkler will be discussing charges in the 2015, Plainfield-area cyber threats case which resulted in school and shopping center closures. Minkler will be joined by Special Agent in Charge W. Jay Abbott, from the Indianapolis FBI Office, Superintendent Doug Carter, Indiana State Police and officials from the Plainfield and Brownsburg Police Departments.

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Alleged to have extorted and made death threats to minor victims, and to use explosive devices at Plainfield and Danville High Schools.

PRESS RELEASE

Indianapolis –United States Attorney Josh J. Minkler announced today that a Bakersfield, California, man has been federally charged for his role in threatening to use explosive devices at Plainfield and Danville, Indiana High Schools, making cyber threats to female victims and producing child pornography. Buster Hernandez, 26, was charged with threats to use an explosive device, threats to injure and sexual exploitation of a child.

“Terrorizing young victims through the use of social media and hiding behind the anonymity of the Internet will not be tolerated by this office,” said Minkler. “Those who think they can outwit law enforcement and are above being caught should think again. Mr. Hernandez’s reign of terror is over.”

According to court documents, the Brownsburg Police Department contacted the FBI in December 2015, asking for assistance with a cyber-threat case involving a minor female victim (Victim 1), a resident of Plainfield Indiana. The threats came from a person known only at the time as “Brian Kil” who used Facebook to communicate with Victim 1 to extort sexually explicit pictures from her. This pattern continued for approximately 16 months with Victim 1 sending sexually explicit images of herself under threat by “Brian Kil.” This technique is commonly referred to as “sextortion.”

When Victim 1 refused to provide additional images as demanded, Hernandez is alleged to have made physical threats to Victim 1, stating “I am coming for you. I will slaughter your entire class and save you for last.” He further made threats to law enforcement saying, “I will add a dozen dead police to my tally…Try me pigs, I will finish you off as well.” These threats caused school administrators to close the Plainfield and Danville High Schools. The Shops at Perry Crossing in Plainfield was also closed December 19, 2015, but reopened the following day after law enforcement insured there were no credible threats.

Hernandez is also alleged to have sexually exploited and threatened two other minor victims (Victims 2 and 3). When Victim 2 stopped complying with Hernandez’s demands, he posted sexually explicit images and videos of Victim 2 that she sent to Hernandez against her will. According to the complaint affidavit, Hernandez asked Victim 3 to attend a community forum held in Plainfield, Indiana, and record law enforcement’s statements about the investigation into “Brian Kil.”

In addition, Hernandez is alleged to have “sextorted” a number of victims in at least 10 federal districts.

“This was a unique and complex investigation that highlights the tenacity, perseverance, expertise and dedication of the FBI Indianapolis’ Crimes Against Children Task Force and was a top priority. Innovative techniques were utilized, solutions to roadblocks created and partnerships with key private sector partners were developed,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. “I stood in front of concerned parents and community members and told them we would find the person who had been victimizing these young girls and, with the tireless work of our agents and partners, we never gave up.”

Hernandez had his initial appearance in the Eastern District of California on Friday, August 4, 2017, and will be transported by the United States Marshal Service to federal court in Indianapolis where he will face charges from the criminal complaint.

This investigation was jointly conducted by the Federal Bureau of Investigation, the Indiana State Police, the Plainfield Police Department and the Brownsburg Police Department.

Indiana State Police Superintendent Doug Carter said, “I have no doubt Buster Hernandez had forgotten all about Plainfield, Indiana and the terror he inflicted; but none of us here forgot.” Carter concluded, “We said we’d keep looking until we found you, and we did.”

“The FBI told us that this would be a long investigation and they were right,” said Plainfield Police Chief Darel Krieger. “However, with dogged determination they have apprehended a person who they believe is the person who posed as Brian Kil. We are grateful not only to the FBI but to all the agencies involved in this investigation (federal state and local) and the great partnership that was shown over the past 20 months.”

“The Brownsburg Police Department is grateful for the opportunity to have personnel from our agency assigned to such a specialized criminal enforcement division such as the Internet Crimes Against Children,” said Chief Joe Grimes. “These partnerships between federal and local agencies allow for a vast availability of resources to safeguard our communities and demonstrate law enforcement’s commitment to protecting the innocent.”

According to Assistant United States Attorney Tiffany J. Preston who is prosecuting this case for the government, Hernandez faces a mandatory minimum sentence of 15 years’ imprisonment, and a maximum of 30 years’ imprisonment if convicted on all counts.

A criminal complaint is merely a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.

If you believe you have been a victim of sextortion by Buster Hernandez, a/k/a Brian Kil, please contact the Indianapolis FBI Office at https://tips.fbi.gov/ or call 317-595-4000, Option 2, to make a report.

Defrauded Social Security of over $114,000

PRESS RELEASE

New Albany –United States Attorney Josh J. Minkler announced today that a Georgetown, Indiana, woman was sentenced in federal court for defrauding the government of Social Security Income funds. Michelle A. South, 40, was sentenced to 10 months imprisonment by U.S. District Judge Tanya Walton Pratt after pleading guilty to Social Security Income fraud.

“SSI funds are designed to help the aged, blind and disabled, not able-bodied individuals,” said Minkler. “When funds are taken from those in most need, you can expect to face federal prosecution.”

From March 2001 through March 2016, South concealed the fact that she had been residing with her husband in their home in Georgetown, Indiana. She claimed on several federal government forms that she lived apart from her husband with three children and had no other sources of income. In reality, she lived with her husband who had income and would not have been eligible had she been truthful on her applications.

This investigation was conducted by the Social Security Administration-Office of the Inspector General.

“This sentence sends a clear message that there is no tolerance for egregious crimes committed against tax payer funded programs like SSI,” said Tracey Thanos, Special Agent in Charge, Social Security Administration-Office of Inspector General.

According to Assistant United States Attorney Kyle M. Sawa who prosecuted this case for the government, South must make restitution of $114,633 and serve three years of supervised release after her prison term.

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today the sentencing of a life-long perpetrator of fraud and identity theft schemes. Catherine A. Demaree, 65, was sentenced to 61 months in federal prison by U.S. District Judge Tanya Walton Pratt after pleading guilty to charges of mail fraud and aggravated identity theft.

“For decades, Catherine Demaree wreaked havoc on Hoosiers’ financial lives,” said Minkler. “Identity theft is a particularly insidious crime, as it devastates people’s credit, which often takes years to repair. This Office will prosecute such crimes to the fullest extent of the law, particularly recidivists like Demaree. Today, her streak of fraud and identity theft comes to an end.”

Demaree’s criminal record began in 1978. Since then, she has been convicted 22 times, most of them felonies and most of them for fraud, forgery, and identity theft. For nearly 40 years, in multiple states and throughout Indiana, she has stolen people’s identities and checkbooks, applied for credit cards and loans in their names, and run up bills for her own personal purchases before being caught. In addition to the identities she stole, she has used over 30 aliases and a dozen false dates of birth and social security numbers throughout her life to conceal her own identity.

In this case, she was caught using Social Security numbers and other identifying information from over 20 individuals throughout southern Indiana. She used their information to apply for bank loans and over 100 credit cards, which she used to make cash withdrawals and personal purchases, such as groceries, gas, phone bills, rental cars, hotel rooms, pizza delivery, and weekly trips to the nail salon.

fact that she had a personal relationship with many of the victims did not deter her. She exploited that relationship to gain access to their personal information, something she had done in her prior offenses as well. Her victims in this case included her next-door neighbors, the owner of a tanning salon where she tanned, and a friend who took Demaree in after Demaree lied and told her that she was being abused by an estranged husband. In fact, Demaree had been arrested by local police for fraud and forgery and had just bonded out of jail. When the friend realized Demaree’s lie, she confronted her. Demaree fled, stealing credit cards and checkbooks belonging to her friend and her friend’s husband and sister.

Ultimately, Demaree made her way to Urbana, Missouri, where she approached an elderly woman who had advertised online for a companion and home health assistance. Demaree spent about a week with the Missouri woman before running off with her checkbook and personal information. Demaree was arrested in Kansas shortly thereafter with the Missouri woman’s checkbook, Social Security card, and Medicare card, along with similar documents for many of the Indiana victims.

Under federal law, Demaree will serve at least 52 months of her 61-month sentence – by far the longest sentence she has received to date.

According to Assistant United States Attorney Nick Linder, who prosecuted the case for the government, Demaree will be closely supervised for 3 years following her prison time.

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Former CPA to spend nearly 3 years in prison for defrauding long-time client out of over $1,000,000

PRESS RELEASE

Indianapolis – United States Attorney Josh J. Minkler announced today that a Bloomington accountant and financial advisor was sentenced in federal court for his role in defrauding a long-time client and family friend of nearly $1.2 million. Michael E. Sallee, 59, was sentenced to 33 months in federal prison by U.S. District Judge Tanya Walton Pratt after pleading guilty to mail fraud charges.

“We expect integrity from accountants and financial professionals,” said Minkler. “We entrust them with our money. We talk with them about our families and our plans for our children and we expect that they are looking out for our best interests. So when they exploit that special trust for their own personal gain through lies and deceit, this office will hold them accountable.”

For over three decades, Sallee served as a trusted CPA and financial advisor for clients throughout southern Indiana. In 1997, he began managing the financial affairs for the victim in this case, a long-time client of his father’s, who was also an accountant. The victim, a widow, and her children and grandchildren, had entrusted Sallee to invest and manage the proceeds from the sale of the family business, which the victim’s late husband had built.

In 2003, however, Sallee began embezzling funds from the victim’s account to his own personal account. For the next ten years, Sallee wrote checks or transferred funds to himself from the victim’s account on almost 100 separate occasions – all the while repeatedly reassuring the victim and her family that their money was safe and growing.

In 2013, the victim and her children began to notice irregularities in the financial statements that Sallee would periodically prepare and mail to them. An FBI investigation revealed that the financial statements were false – they overstated the true value of the victim’s account, which had been drastically reduced by Sallee’s embezzlement.

In total, from 2003 to 2013, Sallee stole $1,193,781.90 from the victim and her family. He used the money for his own benefit, from buying meals at restaurants and making purchases retail stores, to taking family vacations to Disney World, Mackinac Island, and Yellowstone National Park.

“This is someone who was a trusted financial advisor and longtime family friend of the victim who abused his position of trust,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. “This investigation shows that our special agents and local partners work diligently to uncover this type of fraudulent behavior and ensure an individual such as this, who preyed on an elderly person, was brought to justice.”

According to Assistant United States Attorney Nick Linder, who prosecuted the case for the government, Sallee was ordered to pay full restitution to the victim for the entire amount he stole. To date, Sallee has paid back approximately $168,000.

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Brought kilo-quantities into the Evansville area for distribution

PRESS RELEASE

Evansville –United States Attorney Josh J. Minkler announced today that a drug trafficking organization which brought large quantities of heroin into the Evansville area has been dismantled. The drug trafficking organization (DTO) is alleged to have distributed nearly 10 pounds of heroin over a nine-month period in Southwestern Indiana.

“Trafficking in heroin not only brings gun and gang violence to a community, it contributes to the opioid crisis our country faces,” said Minkler. “Helping to reduce crime in our neighborhoods, is, and will remain a top priority of this office.”

Those arrested include:

David Capers, 38, Hazel Crest, Illinois

Emanuel Brewster, 47, Evansville, Indiana

Harry Campbell, 40, Evansville, Indiana

Deandre Brewster, 23, Evansville, Indiana

John Rutter, 29, Evansville, Indiana

Tarana Grimes, 49, Evansville, Indiana

Bretton Vaughn, 41, Chicago, Illinois

Rochelle Brewster, 46, Merrillville, Indiana

According to the Indictment, from August 2016 until May 25, 2017 Capers supplied heroin from the Chicago area to the leaders of the local conspiracy headed by E. Brewer and Campbell. The heroin was then redistributed to other “mid-lower level” dealers for further sale in the community.

Throughout the conspiracy, it is alleged several members distributed the heroin on a “front” basis, where they provided heroin on consignment to other heroin distributors receiving payment after the sale. During the conspiracy, the DTO spoke on telephones at times using code language and text messages to discuss matters relative to the heroin trafficking. It is further alleged that the DTO stored heroin and cash at various properties in Evansville on Cross Street, East Riverside Drive and East Franklin Street.

During the overall investigation, law enforcement confiscated nearly one pound of heroin and two loaded firearms.

This investigation was jointly conducted by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the United States Marshal’s Service, the Indiana State Police, the Washington IN Police Department and the Evansville Vanderburgh County Joint Task Force.

“Every day, 91 Americans die from opioids such as heroin and prescription drugs; federal and local law enforcement working together will stop these criminal organizations who profit from addiction,” said Greg Westfall DEA Assistant Special Agent in Charge. “Saving lives by pursuing these drug traffickers remains DEA’s #1 priority.”

According to Assistant United States Attorney Lauren Wheatley, all defendants were charged with conspiracy to distribute heroin, E. Brewster and D. Brewster were also charged with being felons in possession of a firearm. If convicted on all counts all face 10 years to life in federal prison.

An indictment is only a charge and not evidence of guilt. All defendants are presumed innocent until proved otherwise in federal court.

Defendant had three prior drug charges on his criminal history

PRESS RELEASE

Indianapolis –United States Attorney Josh J. Minkler announced today that an Indianapolis man was sentenced in federal court on drug and weapon charges. Brant Chaszar, 35, was sentenced to 262 months (over 21 years) imprisonment by U.S. District Judge Tanya Walton Pratt after pleading guilty to possession with intent to distribute heroin and carrying a firearm in relation to a drug trafficking crime.

“Trafficking in heroin not only brings gun violence to a community, it contributes to the opioid crisis our country faces,” said Minkler. “Helping to reduce crime in our neighborhoods, is, and will remain a top priority of this office.”

In June 2015, law enforcement officials learned that Chaszar was dealing fentanyl-laced heroin in Indianapolis. They obtained a search warrant for his residence on the near Southside of Indianapolis. As officers approached Chaszar’s residence, he ran from agents and threw a loaded 40-caliber handgun he was carrying to the ground. He was apprehended and found to be in possession of fentanyl-laced heroin.

When agents served a search warrant on his home, they located ammunition, marijuana and additional heroin.

Chaszar has three narcotic-related prior convictions on his record. Because he is a convicted felon, he is not legally permitted to carry a firearm.

This investigation was jointly conducted by the Drug Enforcement Administration the Indianapolis Metropolitan Police Department and the United Drug Task Force of Hendricks County.

“Drug dealers profit from the weakness of addiction and leave a trail of sadness by introducing synthetic opioids such as fentanyl into our communities,” said Assistant Special Agent in Charge of the Indianapolis Drug Enforcement Administration, Greg Westfall. “DEA is committed to the safety of our neighborhoods by bringing drug dealers to justice.”

According to Assistant United States Attorney Barry Glickman who prosecuted this case for the government, Chaszar must serve six years of supervised release following his sentence.

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PRESS RELEASE

Evansville – United States Attorney Josh Minkler announced today that Kevin Kyle McCaffrey, 22, Hickman, Kentucky, was sentenced to 30 months in prison by U.S. District Judge Richard L. Young for two counts of mailing threatening communications and one count of conveying false and misleading information. The case was the result of an investigation by the United States Postal Inspection Service and the Evansville Police Department.

On May 8, 2017, at the time of his guilty plea, McCaffrey affirmed to the court that he mailed threatening communications to the postmaster of an Evansville, Indiana, post office facility located at 600 Cross Valley Circle.

McCaffrey admitted that on or about May 17, 2016, he prepared and mailed an envelope addressed to the “United States Postmaster United States Postal Service Evansville, INDIANA 47711”, containing a letter stating “I wish death to all infidels!” The envelope also contained a simulated explosive device that McCaffrey admitted making, using wires and the parts of an e-cigarette.

McCaffrey admitted sending a second letter addressed to the “United States Postmaster United States Postal Service Evansville, INDIANA 47711,” containing the statement “If you continue to investigate my case and if you bring my case before the district attorney you and your family will not be safe.”

According to Assistant U.S. Attorney Todd S. Shellenbarger, who prosecuted the case for the government, Judge Young also ordered McCaffrey to serve a period of 3 years of supervised released following his release from imprisonment. During his supervision, McCaffrey must submit to drug testing and participate in a substance abuse treatment program.

Robbed a Marsh Supermarket and 10 Speedway Gas Stations

PRESS RELEASE

Indianapolis –United States Attorney Josh J. Minkler announced today that an Indianapolis man has been sentenced after pleading guilty to 22 counts related to recent robberies in the Indianapolis area. Donnell E. Gilder, 23, was sentenced to 420 months (35 years) by U. S. District Chief Judge Jane Magnus-Stinson for his role in robbing a Marsh Grocery store and 10 Speedway gas stations.

“Protecting our neighborhoods from violent crime is a top priority in my office,” said Minkler. “Mr. Gilder’s reign of terror at Indianapolis businesses is over and he will have 35 years in federal prison to think about his actions.”

Between February 29, 2016, and April 27, 2016, Gilder robbed 10 Speedway Gas Stations and a Marsh Supermarket on the Northeast side of Indianapolis. On two occasions, he discharged a handgun during the robbery.

According to court documents, on April 16, 2016, Gilder entered the Speedway station at 5415 E. 65th Street and discharged a round from his handgun into the ceiling. On April 27, 2016, at approximately 3:45am, Gilder approached the Speedway gas station located at 5900 E. 71st Street. The clerk, who was outside the building on a break saw Gilder approach dressed in all black. She quickly ran back into the store and locked the front door. Gilder discharged a handgun at the door, shattering the glass and narrowly missing the clerk.

Gilder was seen driving a stolen vehicle near the robbery scene a short time later when IMPD officers attempted to stop him, Gilder jumped from the vehicle while it was still in gear. The stolen vehicle continued rolling and struck the officer’s patrol car. Officers continued to chase Gilder and apprehended him a few blocks away. Officers recovered a loaded 9mm handgun from the pursuit route.

This case was investigated by the Indianapolis Metropolitan Police Department and the Bureau of Alcohol Tobacco Firearms and Explosives.

“IMPD continues to rely on the relationships that we have with our federal, state and local law enforcement partners to assist in reducing violence in our community,” said IMPD Chief Bryan Roach. “On a daily basis, our officers and detectives work to protect the citizens of Indianapolis and Marion County and we appreciate and look forward to our continued collaboration in reducing crime in our neighborhoods.”

“This individual demonstrated his disregard for human life through his use of a firearm while committing numerous robberies,” stated Trevor Velinor, Special Agent in Charge for ATF’s Columbus Field Division. “His actions merit the sentence handed down, and ATF will continue to work with the IMPD, the United States Attorney’s Office, and all of our law enforcement partners, to ensure that those who threaten our communities face the consequences of their actions.”

Assistant U.S. Attorney Jeffrey D. Preston prosecuted this case for the government.

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Wife filed forged documents in Bankruptcy Court and stole from husband’s retirement account

PRESS RELEASE

Evansville – United States Attorney Josh Minkler announced today the sentencing of an Evansville woman for her role in an elaborate bankruptcy fraud scheme in which she stole thousands of dollars from her husband’s retirement account. Patricia Bippus-Allen, 58, was sentenced to 60 months (five years) imprisonment by U.S. District Judge Richard L. Young after pleading guilty to conspiracy to commit bankruptcy fraud, subornation of perjury, wire fraud, and aggravated identity theft.

“Using the bankruptcy system and government resources to further one’s own selfish and fraudulent scheme will not be tolerated,” said Minkler. “If you intentionally waste the government’s limited judicial resources, you can expect to spend time in federal prison.”

In September 2010, Bippus-Allen filed a joint Chapter 13 bankruptcy petition in both her and her husband’s name in the United States Bankruptcy Court for the Southern District of Indiana. This was done without her husband’s consent, knowledge or authorization. During the course of the bankruptcy proceedings, Bippus-Allen created several documents bearing the forged signature of her husband of over 25 years.

Bippus-Allen also provided her bankruptcy attorney with a letter from a doctor stating her husband was under his care and would be hospitalized for at least 30 days during which he could not see visitors or take phone calls. The doctor who purportedly signed the letter stated it was a forgery and that he had never provided services for her husband.

In March 2011, Bippus-Allen attended a meeting of creditors which her husband was required to attend as well. David Bippus, her brother, attended the meeting with Bippus-Allen and posed as Bippus-Allen’s husband. Bippus-Allen and David Bippus both stated under oath that he was the husband and that all schedules and documents filed in the bankruptcy proceedings were true and correct.

Based on the representations made by Bippus-Allen and David Bippus, a bankruptcy plan was confirmed requiring monthly payments to Bippus-Allen’s trustee for 60 months. Pursuant to this plan, approximately $74,000 was deducted from the direct deposit paychecks of Bippus-Allen’s husband without his consent or knowledge.

Bippus-Allen was convicted of wire fraud stemming from her transferring money from her husband’s 401(k) account into her own personal bank accounts without his consent, knowledge, or authorization. Bippus-Allen made multiple calls to the 401(k) service center purporting to be her husband while also faxing supporting documentation to the service center for a 401(k) hardship withdrawal. In sum, Bippus-Allen made multiple unauthorized withdrawals from her husband’s 401(k) account for a total of over $24,000. Bippus-Allen also took out over $16,000 in loans on her husband’s 401(k) account without his consent, knowledge, or authorization.

This investigation was conducted by the Federal Bureau of Investigation with assistance from the Southern District of Indiana Bankruptcy Fraud Working Group, which includes the U.S. Trustee Program.

"For honest individuals who find themselves overwhelmed by debt, filing for bankruptcy can be a lifesaver. But then there are others who try to get out of paying their debts and line their pockets through illegal actions," said W. Jay Abbott, Special Agent in Charge of the FBI's Indianapolis Division. "The FBI takes our responsibility to pursue those who commit bankruptcy fraud and corrupt the process through deceit very seriously."

“Criminal bankruptcy fraud threatens the integrity of the bankruptcy system, as well as public confidence in that system,” stated Nancy J. Gargula, U.S. Trustee for Indiana, Central Illinois and Southern Illinois (Region 10). “I am grateful to U.S. Attorney Minkler and our law enforcement partners for their strong commitment to combating bankruptcy related crimes, as demonstrated by today’s sentencing.”

The U.S. Trustee Program is the component of the U.S. Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Ind., and Peoria, Ill.

According to Assistant United States Attorneys Kyle M. Sawa and Todd Shellenbarger, who prosecuted this case for the government, Bippus-Allen must pay $112,354 in restitution and serve three years of supervised release following her sentence. Her co-defendant brother, David Bippus, was sentenced in May 2017 to two years of probation and $10,000 in restitution for conspiracy to commit bankruptcy fraud and making false statements in bankruptcy court.

Stored firearms and cash in Indianapolis storage facilities

PRESS RELEASE

Indianapolis –United States Attorney Josh Minkler announced today federal charges against six Indianapolis-area residents for their role in a large-scale marijuana distribution network in Central Indiana. The group faces charges including conspiracy to distribute 1,000 kilograms or more of marijuana, money laundering and unlawful possession of a firearm.

“Drug dealing brings guns and violence into our communities,” said Minkler. “Those who feel they can deal drugs without consequences in this district should think again.”

Those arrested include:

Joseph P. Pickett Sr. a/k/a Jay, 46, Indianapolis

Darrell P. Pickett, 52, Indianapolis

Sheila Stepp, 54, Indianapolis

Leonard O. Allen Jr., 48, Mooresville

Kelly Jo Spinks Jr., 33, Speedway

William J. Belew Jr., 32, Martinsville

The indictment alleges, between June 2015 and March 2017, the drug trafficking organization (DTO) lead by Joseph Pickett Sr., Darrell Pickett and Spinks, travelled to California and obtained between 100 and 400 pounds of marijuana each trip, then transported it back to Indianapolis. It is alleged that on at least 20 occasions, members of the DTO flew by commercial airlines to California to obtain marijuana. They also drove a motor home to a destination in California for the same purpose.

Once in Indianapolis, the marijuana was placed in storage facilities on the Westside of Indianapolis. Members of the DTO would then remove various amounts from the storage facilities for redistribution.

In total, law enforcement confiscated 181 firearms, (seven of which were stolen in Indiana) 21 vehicles, two motor homes, 16 motorcycles, $19,000 in jewelry, over $4.5 million in cash and 280 pounds of high grade marijuana.

This case was investigate by the Indianapolis Metropolitan Police Department and the Drug Enforcement Administration.

“Drug trafficking contributes to the unstableness and violence we observe within our communities today,” said DEA Assistant Special Agent in Charge Greg Westfall. “The DEA, through its core mission and its law enforcement partnerships bring safety to your neighborhoods by investigating and bringing to justice, criminal organizations that poison our streets with illegal drugs. The success of this case was a direct result of the teamwork and dedication to duty of the investigators and prosecutors who worked this investigation.”

“We are extremely thankful for our federal partnerships that continue to help us rid our streets of illegal narcotics,” said Chief Roach. “Federal, State, and Local law enforcement efforts will continue to keep the pressure on those who choose to participate in illegal narcotics selling in our community.”

According to Assistant United States Attorney Barry D. Glickman who is prosecuting this case for the government, Allen faces up to 10 years imprisonment, all other defendants face 10 years to life if convicted.

An indictment is only charge and not evidence of guilt. All defendants are considered innocent until proven guilty beyond a reasonable doubt in federal court.

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PRESS RELEASE

INDIANAPOLIS B United States Attorney Josh Minkler announced today the sentencing of a former financial institution owner after pleading guilty to wire fraud, bank fraud and bankruptcy fraud charges. Todd J. Wolfe , 54, was sentenced to 51 months (over four years) imprisonment by U.S. District Judge Tanya Walton Pratt.

“Defrauding a financial institution effects all honest, hardworking individuals,” said Minkler. “Anyone who uses their position to abuse the public’s trusts will be held strictly accountable.”

Since 2009, Wolfe operated DECA Financial Services in Fishers, Indiana. DECA was a full service credit collections company which at one time employed nearly 75 individuals and whose principal activity was to collect delinquent loans for health care, student loans and financial services.

On two occasions, Wolfe filed false financial reports to BMO Harris bank inflating the assets of his company. The false reports allowed Wolfe to obtain lines of credit which he in turn used for personal expenses. Over a two and one half year period, the credit extended to Wolfe increased from $1 million to $7.5 million. Affidavits show he used some of the money to make payments on his personal residence, an automobile, personal credit card accounts and a lake house.

In June 2013, Wolfe agreed to sell an individual $1 million in DECA stock which represented 5% ownership in the company. The victim was never repaid anything for his stock purchase. Wolfe used some of the $1 million to purchase a 2011 Audi 5S automobile. In February 2014, creditors forced Wolfe into bankruptcy. An attorney representing Wolfe and DECA filed a motion with the court stating Wolfe had a living trust worth over $14 million, which could be used to repay creditors. The actual value of the trust was $52,000. The misrepresentation delayed the appointment of an independent trustee to oversee the operation of and access to books and records.

This was a joint investigation with the Federal Bureau of Investigation and the United States Trustee for Region 10.

“Today’s sentence reaffirms the FBI’s commitment to finding those who use their positions of trust to pad their pockets and enhance their lifestyle by defrauding financial institutions,” said W. Jay Abbott, Special Agent in Charge of the FBI’s Indianapolis Division. “I applaud the hard work of our agents and those of the Southern Indiana Bankruptcy Fraud group who dedicated many hours to this case.”

“Together with U.S. Attorney Minkler and our law enforcement partners, we will continue to pursue fraud and abuse in bankruptcy cases,” stated Nancy Gargula, U.S. Trustee for Indiana and Central and Southern Illinois (Region 10)

U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Ind., and Peoria, Ill. charges resulted, in part, from a referral by the U.S. Trustee for Indiana and Central and Southern Illinois (Region 10) to the U.S. Attorney. Assistance with the investigation was provided by members of the Southern Indiana Bankruptcy Fraud Working Group coordinated by the U.S. Trustee.

Winfield Ong, Criminal Chief for the U.S. Attorney’s Office, said Wolfe must serve three years of supervised release following his sentence and make restitution of $5,023,613 to his victims.

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PRESS RELEASE

Indianapolis – Josh J. Minkler, the United States Attorney, announced today the owner and director of compliance of an Indiana compounding pharmacy were charged criminally in connection with their distribution of over- and under-potent drugs, and defrauding the United States by interfering with and obstructing the lawful functions of the Food and Drug Administration (FDA).

Paul J. Elmer, 64, of Fishers, Indiana, and Caprice R. Bearden, 62, of Carmel, Indiana, were charged in a 10-count indictment with one count of conspiracy to defraud the United States, three counts of distributing an adulterated drug in interstate commerce and six counts of adulterating drugs while held for sale after shipment of a drug component in interstate commerce. Elmer was arrested yesterday and had his initial court appearance in U.S. District Court in the Southern District of Indiana where he pleaded not guilty and was released under conditions imposed by the Court. Bearden was issued a summons to appear before the court. Trial has been scheduled for August 21, 2017 at 9:00 a.m.

“These defendants put greed and the reputation of their company ahead of the health and safety of our most innocent victims,” said Minkler. “Their actions put lives in danger and they will be held accountable.”

“The distribution of over- and under-potent drug products poses a serious risk of harm to patients,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “FDA’s efforts to ensure the safety of compounded drugs is critically important. Impeding FDA’s ability to do its job and uncover these types of safety concerns will not be tolerated. The Justice Department is committed to working with FDA to protect patients and ensure compounded drugs are safe.”

Elmer owned and was the President of Pharmakon Pharmaceuticals Inc. (Pharmakon), and Bearden was the company’s Director of Compliance. Pharmakon compounded drugs at a facility in Noblesville, Indiana for customers in Indiana and many other states.

The indictment alleges that from July 2013 through mid-February 2016, Bearden received approximately 70 potency test failure notices from companies used by Pharmakon to test for potency, indicating that drugs such as morphine sulfate and fentanyl were either under- or over-potent. According to the indictment, Bearden discussed the out-of-specification test results with Elmer, a licensed pharmacist, and until Pharmakon compounded over-potent morphine sulfate in February 2016, Elmer determined that Pharmakon should not contact any individuals or entities – including hospitals – who received the drugs, nor conduct any product recalls before FDA intervention.

On several occasions, according to the indictment, infants were injected with drugs compounded by Pharmakon that were significantly over-potent. For example, the indictment alleges that in early February 2016, Pharmakon distributed over-potent morphine sulfate, an opioid typically used for relief of moderate to severe acute and chronic pain, to a hospital in Indiana and a hospital in Illinois. As alleged in the indictment, three infants at the hospital in Indiana received the morphine sulfate which was nearly 25 times the strength indicated on its label, and one infant was taken by emergency helicopter to a nearby children’s hospital.

Further, as alleged in the indictment, during FDA inspections of Pharmakon in 2014 and 2016, Bearden lied about Pharmakon’s never having received any out-of-specification drug potency test results. According to the indictment, Elmer learned of Bearden’s lies during or shortly after the FDA’s inspections and took no action to correct her and to inform the FDA of the extent of Pharmakon’s drug potency failures. The indictment alleges further that Elmer and Bearden conspired to defraud the United States by interfering with and obstructing the lawful functions of the FDA, and obstructing, influencing and impeding FDA inspections. In addition, as alleged, during the 2016 inspection, Elmer directed at least one Pharmakon employee to backdate batch records of compounded drugs.

“Companies that do not meet federal manufacturing standards, especially when dealing with highly potent drugs like fentanyl meant for vulnerable populations, put the health and safety of American consumers at great risk,” said FDA Commissioner Scott Gottlieb, M.D. “The FDA and our Office of Criminal Investigations will continue to pursue and help bring to justice those companies who put the public health at risk.”

According to the indictment, during two inspections of Pharmakon in 2014, FDA observed conditions that did not comply with FDA regulations. The indictment alleges that Elmer and Bearden failed to investigate the root causes of the drug potency failures and otherwise failed to make changes in Pharmakon’s compounding operations to reduce the incidence of these failures. Instead, as alleged in the indictment, under the direction and supervision of Elmer and Bearden, Pharmakon continued to distribute under- and over-potent drugs, shipping these drugs before receiving the potency test results.

The conspiracy charge carries a statutory maximum sentence of five years in prison and a fine of $250,000 or twice the gross gain or gross loss from the offense. The charges of distributing an adulterated drug in interstate commerce and adulterating drugs while held for sale after shipment of a drug component in interstate commerce each carry a statutory maximum punishment of one year in prison and a fine of $100,000 or twice the gross gain or gross loss from the offense.

Acting Assistant Attorney General Readler and U.S. Attorney Minkler commended the FDA Office of Criminal Investigations, which conducted the investigation. The case is being prosecuted by Assistant U.S. Attorney Cindy J. Cho, of the U.S. Attorney’s Office for the Southern District of Indiana and Trial Attorney David A. Frank of the Civil Division’s Consumer Protection Branch.

For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Southern District of Indiana, visit its website at https://www.justice.gov/usao-sdin.

An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

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The owner and director of compliance of an Indiana compounding pharmacy were charged criminally in connection with their distribution of over- and under-potent drugs, and defrauding the United States by interfering with and obstructing the lawful functions of the Food and Drug Administration (FDA), the Department of Justice announced today.

Paul J. Elmer, 64, of Fishers, Indiana, and Caprice R. Bearden, 62, of Carmel, Indiana, were charged in a 10-count indictment with one count of conspiracy to defraud the United States, three counts of distributing an adulterated drug in interstate commerce and six counts of adulterating drugs while held for sale after shipment of a drug component in interstate commerce. Elmer was arrested yesterday and had his initial court appearance in U.S. District Court in the Southern District of Indiana where he pleaded not guilty and was released under conditions imposed by the Court. Trial has been scheduled for Aug. 21 at 9 a.m.

“The distribution of over- and under-potent drug products poses a serious risk of harm to patients,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “FDA’s efforts to ensure the safety of compounded drugs is critically important. Impeding FDA’s ability to do its job and uncover these types of safety concerns will not be tolerated. The Justice Department is committed to working with FDA to protect patients and ensure compounded drugs are safe.”

“These defendants put greed and the reputation of their company ahead of the health and safety of our most innocent victims,” said U.S. Attorney Josh Minkler for the Southern District of Indiana. “Their actions put lives in danger and they will be held accountable.”

Elmer owned and was the President of Pharmakon Pharmaceuticals Inc. (Pharmakon), and Bearden was the company’s Director of Compliance. Pharmakon compounded drugs at a facility in Noblesville, Indiana for customers in Indiana and many other states.

The indictment alleges that from July 2013 through mid-February 2016, Bearden received approximately 70 potency test failure notices from companies used by Pharmakon to test for potency, indicating that drugs such as morphine sulfate and fentanyl were either under- or over-potent. According to the indictment, Bearden discussed the out-of-specification test results with Elmer, a licensed pharmacist, and until Pharmakon compounded over potent morphine sulfate in February 2016, Elmer determined that Pharmakon should not contact any individuals or entities – including hospitals – who received the drugs, nor conduct any product recalls before FDA intervention.

On several occasions, according to the indictment, infants were injected with drugs compounded by Pharmakon - that were significantly over-potent. For example, the indictment alleges that in early February 2016, Pharmakon distributed over potent morphine sulfate, an opioid typically used for relief of moderate to severe acute and chronic pain, to a hospital in Indiana and a hospital in Illinois. As alleged in the indictment, three infants at the hospital in Indiana received the morphine sulfate which was nearly 25 times the strength indicated on its label, and one infant was taken by emergency helicopter to a nearby children’s hospital.

Further, as alleged in the indictment, during FDA inspections of Pharmakon in 2014 and 2016, Bearden lied about Pharmakon’s never having received any out-of-specification drug potency test results. According to the indictment, Elmer learned of Bearden’s lies during or shortly after the FDA’s inspections and took no action to correct her and to inform the FDA of the extent of Pharmakon’s drug potency failures. The indictment alleges that Elmer and Bearden conspired to defraud the United States by interfering with and obstructing the lawful functions of the FDA, and obstructing, influencing and impeding FDA inspections. In addition, as alleged, during the 2016 inspection, Elmer directed at least one Pharmakon employee to backdate batch records of compounded drugs.

“Companies that do not meet federal manufacturing standards, especially when dealing with highly potent drugs like fentanyl meant for vulnerable populations, put the health and safety of American consumers at great risk,” said FDA Commissioner Scott Gottlieb, M.D. “The FDA and our Office of Criminal Investigations will continue to pursue and help bring to justice those companies who put the public health at risk.”

According to the indictment, during two inspections of Pharmakon in 2014, FDA observed conditions that did not comply with FDA regulations. The indictment alleges that Elmer and Bearden failed to investigate the root causes of the drug potency failures and otherwise failed to make changes in Pharmakon’s compounding operations to reduce the incidence of these failures. Instead, as alleged in the indictment, under the direction and supervision of Elmer and Bearden, Pharmakon continued to distribute under- and over-potent drugs, shipping these drugs before receiving the potency test results.

The conspiracy charge carries a statutory maximum sentence of five years in prison and a fine of $250,000 or twice the gross gain or gross loss from the offense. The charges of distributing an adulterated drug in interstate commerce and adulterating drugs while held for sale after shipment of a drug component in interstate commerce each carry a statutory maximum punishment of one year in prison and a fine of $100,000 or twice the gross gain or gross loss from the offense.

An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

Acting Assistant Attorney General Readler and U.S. Attorney Minkler commended the FDA Office of Criminal Investigations, which conducted the investigation. The case is being prosecuted by Assistant U.S. Attorney Cindy J. Cho, of the U.S. Attorney’s Office for the Southern District of Indiana and Trial Attorney David A. Frank of the Civil Division’s Consumer Protection Branch.

For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Southern District of Indiana visit its website at https://www.justice.gov/usao-sdin.

Preyed on the financially disadvantaged and filed over 2300 fraudulent returns

INDIANAPOLIS – United States Attorney Josh J. Minkler announced today that a tax preparation business owner was sentenced in federal court for his role in directing the filing over 2300 false tax returns. David R. Franklin, 44, previously pleaded guilty to three counts of making and filing false tax reports and was sentenced to 48 months (four years) imprisonment by U.S. District Judge Tanya Walton Pratt.

“Mr. Franklin did not steal from an agency in Washington, he stole from his fellow citizen,” said Minkler. “Judge Pratt’s sentence demonstrates the seriousness of his offense.”

Franklin owned and operated 27 Instant Tax Service (ITS) tax preparation stores in the Indianapolis area employing and training over 50 preparers. On August 8, 2013, United States District Judge Sarah Evans Barker granted a permanent civil injunction against Franklin and ITS. This action ordered Franklin and ITS from directly or indirectly preparing, filing or assisting in the preparation or filing of any federal tax return.

The Internal Revenue Service-Criminal Investigation initiated an investigation of Franklin that revealed Franklin trained and directed his employee return preparers regarding the preparation of federal income tax returns. Specifically, Franklin counseled and advised his employees to prepare false and fraudulent federal income tax returns for multiple clients from 2010 through 2012.

As a specific means of generating false returns, Franklin directed his employees to prepare Form 1040 Schedule C forms reporting inflated business income or losses, which then resulted in unauthorized earned income credits and refunds for taxpayer clients of ITS.

As a result of these efforts by Franklin, more than 2,300 false federal income tax returns were filed by ITS between 2010 and 2012, which resulted in a loss to the Internal Revenue Service and the American public of $1,501,000.

Gabriel Grchan, Special Agent in Charge of IRS Criminal Investigation, said, “Dishonest tax return preparers should take notice that your activities do not go unnoticed. IRS Criminal Investigation is focused on protecting taxpayers by exposing unscrupulous tax return preparers through criminal prosecution and today’s sentencing is another example of these efforts.”

Assistant United States Attorney James M. Warden, who prosecuted this case for the government said, Franklin must make restitution of $1,501,000 and serve three years of supervised release after his sentence.

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Drove from Pennsylvania to Zionsville to have sex with a minor

PRESS RELEASE

INDIANAPOLIS –United States Attorney Josh Minkler announced today the sentencing of a Pennsylvania man for having sex with a 14-year-old girl in Zionsville. Sean A. Donnelly 22, Ephrata, Pennsylvania, was sentenced to 235 months imprisonment (19.5 years) by U.S. District Judge Tanya Walton Pratt after pleading guilty to enticing a minor to engage in illegal sexual activity and possession of child pornography.

“Mr. Donnelly will spend the next 19 years of his life inside the walls of a federal prison as a sex offender,” said Minkler. “One of the top priorities of this office is to protect those who cannot protect themselves.”

According to court documents, Donnelly and a 14-year-old girl from Zionsville, Indiana, met in a chat room on the Internet in February 2015. They conversed regularly by text messages and telephone calls. The conversations became more intimate and Donnelly asked the victim to send naked pictures of herself of which she complied. He would send favorable responses to the victim and asked for more.

On July 2, 2015, Donnelly drove from Pennsylvania to Zionsville and had sexual relations with the victim. He returned on July 9, 2015, for the purpose of having a sexual relationship and was discovered with the victim in a local park by the Zionsville Police Department and taken into custody.

The Zionsville Police Department and the FBI investigated this case.

“The Zionsville Police Department wishes to thank our federal partners at the Federal Bureau of Investigation and the United States Attorney’s Office for their assistance in bringing this individual to justice,” said Zionsville Police Chief Robert Knox. “This was a solid group effort in combating the scourge of those preying on the young people of our communities.”

According to Trial Counsel Kaylynn Shoop of the U.S. Department of Justice’s Criminal Division, Child Exploitation and Obscenity Section (CEOS), and Senior Litigation Counsel Steven D. DeBrota of the Southern District of Indiana, who prosecuted this case for the government, Donnelly must serve 20 years of supervised release after his term of imprisonment and pay a $5,000 fine.

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Stole custom design products when he resigned and took information

to new job with a competitor

PRESS RELEASE

INDIANAPOLIS – The former information technology (IT) system administrator for an Indiana stainless steel fabrication company pleaded guilty and was sentenced today to serve eight months in prison for the theft of his former employer’s proprietary information and wiretapping its email communications.

U.S. Attorney Josh J. Minkler of the Southern District of Indiana, Special Agent in Charge Paul Dvorak of the U.S. Secret Service, Indianapolis Field Office, and Superintendent Douglas G. Carter of the Indiana State Police made the announcement.

“Companies have the right to keep their proprietary interests out of the hands of competitors,” said Minkler. “Those who choose to steal from their employer and then attempt to obstruct a criminal investigation will be held accountable.”

Benjamin Levi Cox, 34, of Nineveh, Indiana, pleaded guilty to one count of wire fraud and one count of interception of electronic communications and was sentenced by U.S. District Judge Sarah Evans Barker. In addition to his prison term, Cox was ordered to serve seven months of home confinement, two years of supervised release and ordered to pay $27,490 in restitution. He was also ordered to perform a further six months of unpaid community service.

According to admissions made in connection with his plea, Cox was formerly employed by Electric Metal Fab, Inc. (“EMF”), a stainless steel fabrication company in Nashville, Indiana. Cox worked as EMF’s IT system administrator and a designer for its computer-aided drafting (“CAD”) system, which EMF used to custom design each product. In or about March 2013, taking advantage of his system administrator privileges, Cox began covertly copying EMF’s entire computer system to an external hard drive. Over a period of three months, Cox repeatedly loaded all of EMF’s proprietary digital information – including thousands of files containing its CAD designs, financial data, sensitive personnel records, and operational and technical documents onto this external device.

As part of his plea, Cox admitted that when he resigned from EMF in June 2013, he took the hard drive containing the stolen EMF data and brought it with him to his new employer, a direct competitor of EMF. Cox then copied multiple files to the new employer’s computer and, among other things, altered the CAD designs to appear as if they had been created by the competitor. The doctored CAD designs were subsequently used by the competitor in obtaining over $45,000 in new contracts with customers that had previously been EMF clients.

Cox further admitted that before quitting EMF, he used his system administrator privileges to secretly configure EMF’s email account settings to auto-forward all of its email communications to two external email accounts he had registered. The intercepted emails included personal correspondence, private financial and legal information, and business dealings between EMF and its clients. After being questioned by investigators, Cox secretly deleted the contents of those email accounts to obstruct the investigation. These efforts were ultimately unsuccessful.

The Cybercrime and High Technology Section of the Indiana State Police and U.S. Secret Service investigated the case. Senior Counsel Aaron R. Cooper of the U.S. Department of Justice’s Criminal Division, Computer Crime and Intellectual Property Section (CCIPS), and Senior Litigation Counsel Steven D. DeBrota of the Southern District of Indiana prosecuted the case. The CCIPS Cybercrime Lab also provided assistance.

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