District of Kansas

WICHITA, KAN. – A Wichita man was charged Monday in federal court with operating illegal gambling businesses, U.S. Attorney Stephen McAllister said.

Jack Oxler, 41, Wichita, Kan., was charged with one count of operating an illegal poker gambling business and one count of operating an illegal sports betting business.

If convicted, he faces up to five years in federal prison and a fine up to $250,000 on each count. The FBI, the Wichita Police Department and the Internal Revenue Service investigated. Assistant U.S. Attorney Aaron Smith and Assistant U.S. Attorney Mona Furst are prosecuting.

KANSAS CITY, KAN. – An Illinois man was sentenced Monday to 73 months in federal prison for driving the getaway car in a $53,000 holdup at a Verizon store in Village West, U.S. Attorney Stephen McAllister said. The robbers held store employees at gunpoint and bound them with zip ties.

Terry Curtis, 34, Rockford, Il., pleaded guilty to one count of commercial robbery. In his plea, he admitted that on Sept. 14, 2016, he was involved when four men robbed the Verizon Wireless store at 10621 Village West Parkway. Two of the robbers entered the store, followed two minutes later by the other two. The robbers locked the door and ordered the employees and a customer into a break room. The robbers ordered them to lay face down on the floor and tied their hands behind their backs. The robbers forced an employee to open a safe before they fled the store with phones and cash worth $53,000. Eventually, an employee managed to get loose and call police.

Investigators used surveillance photos from the robbery to tie the Kansas City robbery to a similar robbery weeks earlier at an AT&T Store in Rochester, Minn. They also received an anonymous call that led them to one of the co-defendants who was on parole in Illinois.

During the investigations, agents learned that some of the defendants in the Verizon robbery were part of a group involved in dozens of similar robberies in several states.

Co-defendants who are awaiting trial include:

Mario Lambert, 33, Rockford, Il.

Sir T. Love, 32, Rockford, Il.

Domonique V. Walker, 26, Rockford, Il.

Sharod Pitts, 35, Chicago, Il.

McAllister commended the Kansas City, Kan., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives for their work on the case.

 

 In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. – A Wichita woman pleaded guilty Friday to producing child pornography while she was babysitting a seven-year-old girl in her home, U.S. Attorney Stephen McAllister said.

 Stefanie Larsen, 46, Wichita, Kan., pleaded guilty to one count of production of child pornography. In her plea, she admitted she allowed a man to produce a series of videos in which he masturbated in the presence of the sleeping child. When the child awoke and cried out, Larsen told her she had just had a bad dream. The man paid Larsen to let him make the videos.

Sentencing is set for April 25. Both parties have agreed to recommend a sentence of 17.5 years. Beall commended the FBI and Assistant U.S. Attorney Jason Hart for their work on the case.

WICHITA, KAN. – A Morton County man is facing federal sex trafficking charges, U.S. Attorney Stephen McAllister said today.

Timothy Joe Rogers, 31, Elkhart, Kan., is charged with two counts of the sex trafficking of a minor. The indictment alleges he solicited a victim under 18 years old to engage in commercial sex acts.

If convicted he faces a penalty of not less than 10 years and a fine up to $250,000 on each count. The FBI investigated. Assistant U.S. Attorney Jason Hart is prosecuting.

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. – A Reno County man is facing federal charges of distributing child pornography, U.S. Attorney Stephen McAllister said today.

Shane Ragsdale, 30, Hutchinson, Kan., is charged with four counts of distributing child pornography via the internet and one count of possession of child pornography.

If convicted he faces a penalty of not less than five years in federal prison and a fine up to $250,000 on each distribution count, and up to 10 years and a fine up to $250,000 on the possession count. The FBI investigated. Assistant U.S. Attorney Jason Hart is prosecuting.

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. – A Wichita man who made hundreds of thousands of dollars from illegal bookmaking pleaded guilty Monday to failing to report the income on his federal income taxes, U.S. Attorney Stephen McAllister said.

Daniel Dreese, 65, Wichita, Kan., pleaded guilty to two counts of making false statements on income tax returns. In his plea, he admitted that in tax year 2011 he received $89,078 from illegal bookmaking, and in tax year 2012 he received $136,985 from illegal bookmaking. He did not report that income.

In addition, he admitted that in 2010, he failed to report $383,684 in income.

In the plea agreement, Dreese agreed to pay $214,540 in restitution.

Sentencing is set for April 23. He faces up to three years in federal prison and a fine up to $100,000 on each count. McAllister commended the Internal Revenue Service and Assistant U.S. Attorney Aaron Smith for their work on the case.

WICHITA, KAN. – A Pennsylvania man who owns a company called Horseshoe Hill Outfitters pleaded guilty Monday in federal court in Kansas to violating the Lacey Act, U.S. Attorney Stephen McAllister said.

Robert P. McConnell, 48, Slippery Rock, Penn., pleaded guilty to four counts of importing deer into Kansas in violation of the Lacey Act, which regulates the trade in wildlife, fish and plants that has been illegally taken, possessed, transported or sold. Horseshoe Hill Outfitters advertises what it calls “trophy North American big game hunting adventures” in Kansas, Pennsylvania, New Mexico and Ontario.

In two counts, McConnell admitted importing deer that were not from an accredited heard, were not officially identified and did not have a certificate of veterinary inspection. In two other counts, he admitted importing domesticated deer.

Sentencing is set for May 21. Both parties have agreed to recommend a sentence of five years on probation during which McConnell is prohibited from doing business in Kansas, and a fine of not less than $10,000.

McAllister commended the U.S. Fish and Wildlife Service and Assistant U.S. Attorney Greg Hough for their work on the case.

 

A tax return preparer in the Wichita, Kansas, area prepares fraudulent tax returns for her customers, according to a new civil lawsuit filed by the Justice Department today. The suit, filed in federal court in Wichita, Kansas, asks the court to permanently bar Ma Guadalupe Valenzuela (a/k/a Maria Guadalupe Valenzuela a/k/a Lupe Valenzuela, individually and doing business as Servicio de Income Tax) from preparing federal tax returns for others. The government also asks the court to order Valenzuela to turn over the names of customers for whom she has prepared federal tax returns since 2012.

The complaint alleges that the defendant unlawfully understates her customers’ income tax liabilities and overstates these customers’ refunds. According to the complaint, Valenzuela unlawfully prepares federal tax returns that lowers her customers’ federal tax liabilities by claiming bogus child tax credits, improper dependency exemptions, and false filing statuses.

The IRS has a list of steps on their website that you can take now in anticipation of filing your 2017 federal income tax return. Return preparer fraud was one of the IRS’s Dirty Dozen Tax Scams for 2017 and taxpayers seeking a return preparer should remain vigilant. The IRS has some tips on their website for choosing a return preparer and has launched a free directory of federal tax preparers.

In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

WICHITA, KAN. – A man from Liberal was sentenced Thursday to 72 months in federal prison for distributing child pornography, U.S. Attorney Stephen McAllister said.

Michael Martin, 50, Liberal, Kan., pleaded guilty to one count of distributing child pornography. Martin admitted that a detective with the Kansas Internet Crimes Against Children Task Force downloaded child pornography from Martin’s computer over a file-sharing network. The images depicted a prepubescent girl engaged in sex acts with an adult. Investigator also found child pornography on Martin’s smartphone.

McAllister commended Homeland Security Investigations, the Kansas Internet Crimes Against Children Task Force and Assistant U.S. Attorney Jason Hart for their work on the case.

WICHITA, KAN. – A southeast Kansas man was indicted Tuesday on federal drug and firearm charges, U.S. Attorney Stephen McAllister said.

 

Scott Joseph Skibo, 54, Chetopa, Kan., was charged with one count of possession with intent to distribute marijuana, and one count of unlawful possession of a firearm in furtherance of drug trafficking. The indictment alleges that on Sept. 18, 2017, Skibo possessed fifty or more marijuana plants and a .40 caliber Glock 22 handgun.

 

The Kansas Bureau of Investigation announced in September that agents arrested Skibo for cultivating marijuana on an island in Elmore Park within the city limits of Chetopa, Kan. He attempted to flee law enforcement in a boat before he was arrested.

 

If convicted, Skibo faces not less than five years in federal prison and a fine up to $250,000 on the firearm charge, and up to five years and a fine up to $250,000 on the marijuana charge. The KBI, the Labette County Sheriff’s Department and the Chetopa Police Department investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.

 

 

OTHER INDICTMENTS

 

Danny Acosta-Zavala, 32, and Cecilia Ann Rios, 36, are charged with one count of possession of more than 12 pounds of heroin. The crime is alleged to have occurred Jan. 1, 2018, in Thomas County, Kan.

 

If convicted, they face not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.

 

Manuel Hernandez, 43, Wichita, Kan., is charged with one count of escaping from custody at the Mirror, Inc., in Wichita.

 

If convicted, he faces up to five years in federal prison and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

 Rodolfo Moreno-Banuelos, 29, a citizen of Mexico, is charged with one count of unlawful possession of a firearm by an alien illegally in the United States. He was found Jan. 13, 2018, in Sedgwick County, Kan.

 

Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney David Lind is prosecuting.

 

Jesus Benito Vergara-Gonzalez, 24, of Kansas City, Mo., is charged with one count of misusing a Social Security number and one count of aggravated identity theft. The crimes are alleged to have occurred March 21, 2017, in Kansas City, Kan.

 

If convicted, he faces up to five years in federal prison and a fine up to $250,000 on the Social Security charge and a mandatory two years (consecutive) and a fine up to $250,000 on the identity theft charge. The Kansas Department of Revenue investigated. Assistant U.S. Attorney Aaron Smith is prosecuting.

 

William Daniel Wycoff, 32, Wichita, Kan., is charged with one count of unlawful possession of ammunition following a felony conviction. The crime is alleged to have occurred Jan. 13, 2018, in Sedgwick County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Aaron Smith is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

Former Kansas Highway Patrol Trooper James Carson pleaded guilty in federal court to violating an individual’s civil rights by using excessive force, announced Acting Assistant Attorney General for the Civil Rights Division John Gore, United States Attorney for the District of Kansas Stephen R. McAllister, and Special Agent in Charge for the Kansas City Field Office of the Federal Bureau of Investigation Darrin E. Jones.

According to documents filed in connection with the plea, on June 25, 2013, the Defendant, James Carson, was acting under color of law as a Trooper for the Kansas Highway Patrol when he used unreasonable force against an arrestee, R.T.  According to the documents, Carson conducted a lawful arrest and then transported R.T. to the Labette County Jail, where at least five other law enforcement officials were present.  As Carson removed R.T. from the patrol vehicle and escorted him into the booking area, R.T.’s hands were cuffed behind his back.  Without warning, Carson kicked the legs out from underneath R.T., causing R.T. to crash down on his back onto the floor.  Carson admitted in court that he used force against R.T. for the purpose of punishment and not for a legitimate law enforcement purpose.

As part of the plea agreement, Carson has agreed to surrender his law enforcement credentials and never again accept any employment related to law enforcement.

“Any law enforcement official who uses excessive and unreasonable force against an arrestee violates the Constitution and its provision to provide for the safety and security of all citizens,” said Acting Assistant Attorney General John Gore of the Civil Rights Division. “The Justice Department will continue to aggressively prosecute officer misconduct and protect the integrity of our civil rights laws.”

This case was investigated by the Topeka Resident Agency of the Kansas City Field Office of the FBI.  The case was initially investigated by the Kansas Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Jared Maag of the United States Attorney’s Office and Trial Attorney Rose Gibson of the Civil Rights Division’s Criminal Section.

Former Kansas Highway Patrol Trooper James Carson pleaded guilty in federal court to violating an individual’s civil rights by using excessive force, announced Acting Assistant Attorney General for the Civil Rights Division John Gore, United States Attorney for the District of Kansas Stephen R. McAllister, and Special Agent in Charge for the Kansas City Field Office of the Federal Bureau of Investigation Darrin E. Jones.

 

According to documents filed in connection with the plea, on June 25, 2013, the Defendant, James Carson, was acting under color of law as a Trooper for the Kansas Highway Patrol when he used unreasonable force against an arrestee, R.T.  According to the documents, Carson conducted a lawful arrest and then transported R.T. to the Labette County Jail, where at least five other law enforcement officials were present.  As Carson removed R.T. from the patrol vehicle and escorted him into the booking area, R.T.’s hands were cuffed behind his back.  Without warning, Carson kicked the legs out from underneath R.T., causing R.T. to crash down on his back onto the floor.  Carson admitted in court that he used force against R.T. for the purpose of punishment and not for a legitimate law enforcement purpose.

As part of the plea agreement, Carson has agreed to surrender his law enforcement credentials and never again accept any employment related to law enforcement.

 

“Any law enforcement official who uses excessive and unreasonable force against an arrestee violates the Constitution and its provision to provide for the safety and security of all citizens,” said Acting Assistant Attorney General John Gore of the Civil Rights Division. “The Justice Department will continue to aggressively prosecute officer misconduct and protect the integrity of our civil rights laws.”

 

This case was investigated by the Topeka Resident Agency of the Kansas City Field Office of the FBI.  The case was initially investigated by the Kansas Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Jared Maag of the United States Attorney’s Office and Trial Attorney Rose Gibson of the Civil Rights Division’s Criminal Section.

WICHITA, KAN. – Stephen R. McAllister was sworn in Thursday as U.S. Attorney for the District of Kansas.

 

The Honorable Clarence Thomas of the United States Supreme Court administered the oath in a private ceremony today on the University of Kansas campus.

 

McAllister was nominated by President Donald Trump and confirmed by the U.S. Senate. He will be in charge of a staff of more than 100, including 50 attorneys, who work in offices in Topeka, Wichita and Kansas City, Kan. Tom Beall, who has served as U.S. Attorney on an interim basis since former U.S. Attorney Barry Grissom resigned in April 2016, will return to his position as First Assistant U.S. Attorney.

 

“I am honored to serve,” McAllister said. “I accept the duty to follow the law and to uphold the principles of fairness, impartiality and equal justice for all.”

 

McAllister has served as the Solicitor General of Kansas and the E.S. & Tom W. Hampton Distinguished Professor of Law at the University of Kansas. He argued nine times before the Supreme Court of the United States and he has taught constitutional law and federal civil rights law at KU. He clerked for Justice Thomas as well as the Honorable Byron R. White of the United States Supreme Court, and the Honorable Richard A. Posner at the United States Court of Appeals for the Seventh Circuit. He received a bachelor’s degree in 1985 from the University of Kansas, and a law degree in 1988 from the University of Kansas School of Law.

WICHITA, KAN. - A Wichita man who lived in base housing at McConnell Air Force Base was sentenced Monday to 30 years in federal prison for sexually abusing two teenage girls, U.S. Attorney Tom Beall said.

 

Random Shane Smith, 38, Wichita, Kan., pleaded guilty to two counts of aggravated sexual abuse. In his plea, Smith admitted using force to make the two 16-year-old victims have sex with him. The assaults took place in base housing.

 

Beall commended the FBI, Air Force OSI and Assistant U.S. Attorney Jason Hart for their work on the case.

KANSAS CITY, KAN. - A Kansas City man has been charged with robbing a bank in Bonner Springs, U.S. Attorney Tom Beall said today.

 

Timothy Karpovich, 39, Kansas City, Mo., was charged with one count of bank robbery. An investigator’s affidavit filed in the case alleged that on Monday morning Karpovich robbed the KCB Bank at 13010 Commercial in Bonner Springs. He gave the teller a handwritten note and kept his right hand in his pocket as if he had a gun. He fled the bank on foot.

 

Police received a tip that the robber gambled regularly at Harrah’s Casino in North Kansas City, Mo. Casino employees identified Karpovich from a bank surveillance photo. He was arrested without incident at the casino.

 

If convicted, he faces up to 20 years in federal prison. The FBI, the Bonner Springs Police Department and the Missouri Highway Patrol Gaming Division investigated. Assistant U.S. Attorney Trent Krug is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

KANSAS CITY, KAN. B A Missouri man pleaded guilty Monday to charges he and his accomplices swindled homeowners facing foreclosure with false promises to help them save their homes, U.S. Attorney Tom Beall said.

 

Tyler Korn, 28, St. Ann, Mo., pleaded guilty to one count of conspiracy to commit wire and mail fraud. In his plea, he admitted he and co-defendants used the address of a UPS store in Overland Park, Kan., to form Reliant Home Financial Group, a company they operated out of the St. Louis metro area.

 

The indictment alleges the defendants took money from victims and fraudulently promised to:

• Lower their interest rates.
• Lower their monthly payments.
• Help them obtain loan modifications.

 

When victims received foreclosure notices, the defendants advised them not to worry about it.

 

Other defendants include:

Amjad Daoud, 33, Lutz, Fla., who is awaiting trial.

Ruby Price, 73, Bonner Springs, Kan., who is awaiting sentencing.

 

Korn will be scheduled for sentencing later. He faces up to 20 years in federal prison and a fine up to $1 million on each count. Beall commended the U.S. Department of Housing and Urban Development - Office of Inspector General, the Federal Housing Finance Agency - Office of Inspector General, the Johnson County District Attorney’s Office, Special Assistant U.S. Attorney Emilie Burdette and Assistant U.S. Attorney Jabari Wamble for their work on the case.

WICHITA, KAN. - A Cherokee County man was sentenced Monday to 18 months in prison for unlawful disposal of hazardous waste, U.S. Attorney Tom Beall said.

 

Jack E. Smith, 37, Scammon, Kan., pleaded guilty to one count of unlawful disposal of hazardous waste. In his plea, he admitted he bought a truck that was loaded with urethane flooring materials, paints and other chemicals. He knew the materials were hazardous and flammable when he bought the truck.

 

Smith transported the truck to his residence and then to a rural location in Crawford County. Before he had unloaded all the containers, they caught fire. The United States calculated the cost of cleaning up the site at more than $19,000.

 

Beall commended Environmental Protection Agency and Assistant U.S. Attorney Alan Metzger for their work on the case.

WICHITA, KAN. – A retired highway patrol trooper was charged Thursday with lying to the FBI during an investigation into illegal gambling in Wichita, U.S. Attorney Tom Beall said.

 

Michael Frederiksen, 52, Derby, Kan., is charged with two counts of making false statements to FBI investigators. A criminal complaint filed in federal court in Wichita alleges that in 2014, while Frederiksen was still a Kansas Highway Patrol Trooper, he was filmed taking part in an illegal cash poker game. On Feb. 23, 2017, he was interviewed by FBI agents investigating illegal gambling businesses in Wichita.

 

The FBI had a video of Frederiksen playing in an illegal cash poker game held Feb. 12, 2014, at 922 1/2 E. Douglas in the Old Town district of Wichita. The site was equipped with poker tables, a cabinet for valuables and poker chips, video surveillance equipment, liquor and snacks. Staff included dealers, someone serving food and a waitress serving drinks and giving massages to the players.

 

An undercover investigator was at the game posing as a gambler. At one point, the undercover officer tried to use his phone to take photos. The men running the game took him aside and told him he was making other players nervous. They allowed the undercover officer to continue playing, but moved the game to other locations after that night.

 

The FBI also knew that Fredericksen had frequent contact with one of the organizers of the poker game, identified in the charges as J.S.

 

During the FBI interview, Fredericksen made false statements, downplaying his involvement in illegal poker and his relationship with the operator of the poker game.

 

If convicted, Fredericksen faces up to five years in federal prison and a fine up to $250,000 on each count. The FBI, Wichita Police Department and the Internal Revenue Service investigated. Assistant U.S. Attorneys Aaron Smith and Mona Furst are prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

TOPEKA, KAN. – An indictment unsealed Thursday alleges three Kansas residents lied on forms they filled out to purchase firearms, U.S. Attorney Tom Beall said. All three defendants were soldiers stationed at Fort Riley.

 

Johny Perez, 26, Junction City, Kan., is charged with six counts of making false statements on ATF Form 4473 when he purchased firearms from licensed dealers, and one count of dealing firearms without a federal license. Jorge Flores, 26, Fort Riley, is charged with two counts of making false statements when he purchased firearms. Maya George, 22 Fort Riley, is charged with one count of making a false statement when she purchased firearms.

 

All three defendants are accused of falsely denying that they were acquiring the firearms on behalf of other buyers. The firearms were purchased from Jack and Dick’s Jewelry and Loan in Junction City, Godfrey’s Indoor Shooting and Archery Ranges in Junction City and Quantico Tactical Supply in Junction City.

 

If convicted, they face up to 10 years in federal prison and a fine up to $250,000 on each count of making a false statement. Dealing guns without a license carries a penalty of up to five years and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

 

WICHITA, KAN. – Two Wichita police officers and a gambling operator tried to out an undercover investigator at a poker game, a federal indictment unsealed today alleges.

 

Three men are charged with obstructing a criminal investigation, U.S. Attorney Tom Beall said. Bruce Mackey, 45, Goddard, Kan., a Wichita police officer, Michael Zajkowski, 50, Wichita, Kan., who is no longer a Wichita police officer, and Brock Wedman, 48, St. Marys, Kan., are charged with one count of obstructing law enforcement. In addition, Wedman is charged with lying to the FBI about the incident.

 

The indictment alleges that Wedman and a co-conspirator operated a gambling business and sponsored an illegal poker game on Feb. 12, 2014, in Wichita. When Wedman began to suspect there was an undercover officer at the game, he wanted to know if the car the man was driving belonged to the city of Wichita.

 

Wedman and a co-conspirator asked Zajkowski and Mackey, both of whom were Wichita police officers at that time, for help. Zajkowski and Macey made a series of calls and sent texts attempting to use police resources to determine who owned the car. They gave Wedman reason to believe an undercover officer was present and they confirmed his car was registered to the City of Wichita and in service to the Wichita Police Department.

 

When the FBI interviewed Wedman in February 2017, he falsely denied he gave the co-defendants the license plate number and VIN number of the car and asked them to find out who owned it.

 

Upon conviction, both counts carry a penalty of up to five years in federal prison and a fine up to $250,000. The Wichita Police Department. the FBI and the Internal Revenue Service investigated. Assistant U.S. Attorney Aaron Smith and Assistant U.S. Attorney Mona Furst are prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduc

A former resident of Overland Park, Kansas, was sentenced to 96 months in prison today for aiding and assisting in the preparation and presentation of false income tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Thomas E. Beall for the District of Kansas.

 

According to documents filed with the court, Alfred Reece, 58, owned and operated a tax preparation business in Kansas City.  From approximately 2013 through 2015, Reece prepared federal tax returns for individuals, claiming false business income and losses, medical and dental expense deductions, job-related expenses, charitable donations and other fraudulent items.  Reece also concealed himself as the preparer on these fraudulent returns by falsely claiming that they were self-prepared.  Reece admitted to causing a tax loss of between $550,000 and $1.5 million.

 

In addition to the term of imprisonment, U.S. District Court Judge Julie A. Robinson ordered Reece to serve one year of supervised release and to pay $648,442 in restitution to the Internal Revenue Service (IRS).  Reece pleaded guilty in October 2017 to aiding and assisting in the preparation and filing of false and fraudulent tax returns. 

 

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Beall commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorney John T. Mulcahy of the Tax Division and Assistant U.S. Attorney Scott C. Rask of the District of Kansas, who are prosecuting the case.

 

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

KANSAS CITY, KAN. – A Kansas City, Kan., man was sentenced Wednesday to 15 years in federal prison after admitting he distributed six to 10 kilos of methamphetamine a week, U.S. Attorney Tom Beall said.

 

Luis Enrique Martinez-Rosales, 25, Kansas City, Kan., pleaded guilty to one count of conspiracy to distribute methamphetamine and one count possession with intent to distribute. In his plea, he admitted the Kansas Highway Patrol found two kilograms of methamphetamine and almost $50,000 in cash when they stopped his car on I-70 in Wyandotte County, Kan. He received methamphetamine in loads smuggled into the United States in tractor-trailers and wired payment to Mexico.

 

Beall commended the Kansas Highway Patrol, the Drug Enforcement Administration and Assistant U.S. Attorney Tris Hunt for their work on the case.

KANSAS CITY, KAN. – A Kansas City, Kan., man was sentenced Tuesday to 92 months in federal prison for unlawful possession of a 9 mm handgun that was used in a robbery, U.S. Attorney Tom Beall said.

 

Joshua J. Flaugher, 32, Kansas City, Kan., pleaded guilty to one count of unlawful possession of a firearm by a convicted felon. In his plea, Flaugher admitted that investigators seized a loaded 9 mm handgun with a 30-round extended magazine from his residence. Flaugher was arrested at his aunt’s home in the 2400 block of Everett Avenue. Because he had a prior felony conviction in Wyandotte County District Court on a charge of aggravated battery, he was prohibited by federal law from possessing a firearm.

 

Beall commended the Kansas City, Kan., Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, Assistant U.S. Attorney Sheri Catania and Assistant U.S. Attorney Terra Morehead for their work on the case.

 

This prosecution was brought under Project Safe Neighborhoods (PSN), a Justice Department program aimed at prosecuting convicted felons who violate a federal ban on possession of firearms. Attorney General Jeff Sessions has directed U.S. Attorney’s Offices nationwide to emphasize PSN prosecutions as part of a national strategy to reduce violent crime.

WICHITA, KAN. – Two Wichita men pleaded guilty Friday to federal gambling and income tax charges, U.S. Attorney Tom Beall said.

 

Danny Chapman, 67, Wichita, Kan., pleaded guilty to one count of operating an illegal gambling business and one count of tax evasion. Daven Flax, 46, Wichita, pleaded guilty to two counts of operating an illegal gambling business and one count of making a false statement on a tax return.

 

         

Chapman: Online sports betting

 

In his plea, Chapman admitted he worked as a sports bookmaker in the Wichita area and had at least five people working for him. Chapman and his subordinates took bets on sporting events from clients in their “book” of bettors and collected their losses. They arranged for clients to place bets through online gambling web sites that were created and hosted in Costa Rica. Chapman and subordinates kept a portion of the money they collected. His gross revenue from bookmaking exceeded $2,000 in a single day.

 

Chapman failed to pay almost $345,000 in federal income taxes on his earnings from illegal gambling. In order to evade taxes, he purchased vehicles in cash and registered them in the name of other persons, including a colleague and a nephew. He frequently purchased money orders and cashier’s checks using the names of family members.

 

 

Flax: Poker games in Wichita, sports betting

 

In his plea, Flax admitted he operated an illegal gambling business in Wichita. He conducted and managed illegal poker games at numerous locations in Wichita. His income came from taking a cut or “rake” from the amount of money wagered. He was responsible for paying employees including dealers, waitresses and caterers as well as paying for the use of commercial properties where poker games were held. The games were not open to the public. Only gamblers who were invited could play.

 

In addition, Flax worked as a sub-bookie for Chapman’s sports betting operation.

 

Flax failed to pay more than $65,000 in federal income taxes on his earnings from illegal gambling.

 

Chapman and Flax will be sentenced at a later time. Upon conviction, the crimes carry the following penalties:

          Illegal gambling business: Up to five years in federal prison and a fine up to $250,000.

          Tax evasion: Up to five years and a fine up to $250,000.

          Making a false statement on a tax return: Up to three years and a fine up to $100,000.

 

Beall commended the FBI, the Internal Revenue Service, the Wichita Police Department, Assistant U.S. Attorney Aaron Smith and Assistant U.S. Attorney Mona Furst for their work on the case.

TOPEKA, KAN. – A Topeka man pleaded guilty Wednesday to a robbery at a McDonald’s restaurant, U.S. Attorney Tom Beall said.

 

Brendon R. Thompson, 30, Topeka, Kan., pleaded guilty to one count of robbery and one count of aiding and abetting another robber who brandished a firearm during the robbery.

 

In his plea, Thompson admitted that on July 10, 2017, he and another man robbed the McDonald’s restaurant at 1100 South Kansas Avenue in Topeka. Thompson went behind the counter and took money from the registers while the other robber brandished a firearm. The robbers fled when police arrived. Thompson was arrested near the restaurant, while the other robber got away.

 

Anyone with information about the other robber is encouraged to contact Crime Stoppers. Call 785-234-0007 or visit www.topekacrimestoppers.org online.

 

Thompson’s sentencing will be scheduled for a later date. Both parties have agreed to recommend a controlling sentence of not less than 130 months and not more than 165 months in federal prison.

 

Beall commended the FBI, the Topeka Police Department and Assistant U.S. Attorney Jared Maag for their work on the case.

 

TOPEKA, KAN. – A Topeka man pleaded guilty Wednesday to five bank robberies in four states, U.S. Attorney Tom Beall said.

 

Dakota Shareef Walker, 21, Topeka, Kan., pleaded guilty to the following robberies:

 

• U.S. Bank, 5730 Southwest 21st, Topeka, Nov. 28, 2016.
• U.S. Bank, 221 West Gregory Blvd, Kansas City Missouri, Nov. 23, 2016.
• U.S. Bank, 748 Main Street, Evanston, Wyo, Dec. 6, 2016.
• U.S. Bank, 25 East 50 South, Malad City, Idaho, Dec. 14, 2016.
• Wells Fargo Bank, 5 North State Street, Preston, Idaho, Jan. 9, 2017.

 

In each case, Walker gave tellers a note warning not them not to activate any alarms or to make any sudden moves.

 

Sentencing is set for April 16. All parties have agreed to recommend a sentence in a range from 57 and 96 months in federal prison. Beall commended the FBI, the Topeka Police Department and Assistant U.S. Attorney Jared Maag for their work on the case.

 

KANSAS CITY, KAN. – A Junction City woman was indicted Wednesday on charges of producing child pornography, U.S. Attorney Tom Beall said.

 

Kayla Michelle Simpson, 22, Junction City, Kan., is charged with one count of using a child to produce child pornography and one count of violating the conditions imposed on a registered sex offender. The crime is alleged to have occurred in July 2016 in Junction City.

 

The indictment alleges that Simpson, who was registered sex offender, enticed a 16-year-old victim to engage in sexual activity for the purpose of producing child pornography.

 

If convicted, Simpson faces a penalty of not less than 15 years and not more than 30 years in federal prison on the production charge, and up to 10 years and a fine up to $250,000 on the sex offender charge. The FBI investigated. Assistant U.S. Attorney Christine Kenney is prosecuting.

 

 

OTHER INDICTMENTS

 

Mack W. Colvin, Jr., 31, Park City, Kan., is charged with one count of bank robbery and two counts of brandishing a firearm.

 

The indictment alleges Colvin robbed the Fidelity Bank branch at 1306 N. Woodlawn in Wichita on Dec. 13, 2017, and the Wheat State Credit Union at 1400 S. Oliver in Wichita on Dec. 19, 2017. In both cases, he is charged with brandishing a firearm.

 

If convicted, he faces up to 25 years in federal prison and a fine up to $250,000 on each robbery charge, and not less than seven years and a fine up to $250,000 on each firearm charge. The FBI and the Wichita Police Department investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

John Stephen Kissell, 31, who is in custody, is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred in September 2017 in Topeka, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

KANSAS CITY, KAN. - A former postal worker in Johnson County was sentenced Tuesday to five years on federal probation for smuggling marijuana through the mail, U.S. Attorney Tom Beall said.

 

Terrell Dewayne Shears, 25, Overland Park, Kan., pleaded guilty to one count of possession with intent to distribute marijuana. In his plea, he admitted he gave addresses on his route to marijuana traffickers in Arizona. The traffickers mailed parcels containing marijuana to addresses on his route and Shears intercepted the packages. Shears dropped the packages off at an apartment building where he had been instructed to leave them and texted a recipient he knew only as “John” to pick them up.

 

Investigators seized more than 40 pounds of marijuana from his postal vehicle.

 

Beall commended the U.S. Postal Service and Special Assistant U.S. Attorney James Ward for their work on the case.

KANSAS CITY, KAN. B A Mexican man was sentenced Thursday to 46 months in federal prison for his role in smuggling more than 1,000 pounds of liquid methamphetamine into Kansas City, Kan., U.S. Attorney Tom Beall said.

 

Yoan Alejandro Castillo-Zamora, 31, a citizen of Mexico, pleaded guilty to one count of conspiracy to distribute methamphetamine. He was arrested Jan. 13, 2017. Federal agents watched him and others at a business in Kansas City, Kan., unload liquid methamphetamine from a fuel tank on a semi-truck into five-gallon buckets. They loaded the buckets into a white Dodge Caravan.

 

Beall commended the Drug Enforcement Administration, the Kansas City DEA Special Response Team, the Kansas City, Kan., Police Department and Assistant U.S. Attorney Greg Hough for their work the case.

WICHITA, KAN. – A Parsons woman pleaded guilty Monday to embezzling $5 million from a credit union where she worked, U.S. Attorney Tom Beall said.

 

Nita Rae Nirschl, 66, Parsons, Kan., pleaded guilty to one count of embezzlement, one count of money laundering and one count of attempted tax evasion. In her plea, she admitted the crimes occurred while she was an officer and employee of Parsons Pittsburg Credit Union headquartered in Parsons, Kan. She withdrew money from the assets of the credit union and deposited the money into accounts she controlled. She used the stolen money to buy a car, a house and other items.

 

Sentencing is set for March 5, 2018. Both parties have agreed to recommend a sentence of five years in federal prison and an order of restitution.

 

Beall commended the FBI, the Internal Revenue Service and Assistant U.S. Attorney Lanny Welch for their work on the case.

KANSAS CITY, KAN. – A professional racecar driver who lives in Leawood was indicted Wednesday on federal charges of failing to report millions in income from payday lending business he owned, U.S. Attorney Tom Beall said. The defendant’s accountant was indicted, too.

 

Scott Tucker, 55, Leawood, Kan., is charged with one count of filing a false tax return, and W. Brett Chapin, 46, Shawnee, Kan., is charged with aiding in the filing of a false tax return.

 

The indictment alleges that in 2008 Tucker orchestrated a sham sale of his company CLK Management to the Miami tribe for $120,000. In fact, Tucker continued to control CLK and a new entity, AMG Services, Inc.

 

After the sale, other people and entities were listed as owners of Tucker’s payday lending businesses. In fact, Tucker controlled the daily operations of those business. He was the source of funds being lent and he bore the risk of loans not being repaid.

 

          Tucker’s payday lending businesses included Ameriloan, Cash Advance, One Click Cash, Preferred Cash Loans, United Cash Loans, US FastCash, 500 FastCash, Advantage Cash Services and Star Cash Processing.

 

          Chapin was a CPA who prepared Tucker’s tax returns for 2008, 2009, 2010, and 2011. On Oct. 19, 2009, Tucker signed a 2008 tax return prepared by Chapin that failed to report more than $42.5 million in income from Tucker’s payday lending businesses. On Oct. 20, 2011, Tucker signed a 2010 tax return prepared by Chapin that failed to report more than $75 million in income from Tucker’s payday lending businesses.

 

          Upon conviction, the crimes carry the following penalties:

          Conspiracy: Up to five years in federal prison and a fine up to $250,000.

          Filing a false tax return: Up to three years and a fine up to $250,000.

          Aiding and abetting the filing of a false tax return: Up to three years and a fine up to $250,000.

 

          The Internal Revenue Service investigated. Assistant U.S. Attorney Chris Oakley and Assistant U.S. Attorney Scott Rask are prosecuting.

 

 

 

OTHER INDICTMENTS

 

Richard Armenta, 57, Overland Park, Kan., is charged with one count of bank robbery.

 

The indictment that on Nov. 24, 2017, Armenta robbed Capitol Federal Savings Bank at 9001 E. Santa Fe in Overland Park, Kan.

 

If convicted he faces up to 20 years in federal prison and a fine up to $250,000.

 

The Overland Park Police Department and the FBI investigated. Assistant U.S. Attorney Kim Flannigan is prosecuting.

 

Anois Coronado-Floriano, 31, Kansas City, Kan., Idania Daniela Ortiz, 37, Kansas City, Kan., and Carlos Coronado, 26, Kansas City, Kan., are charged with one count of conspiracy to distribute methamphetamine and one count of possession with intent to distribute methamphetamine. The crimes are alleged to have occurred Dec. 6, 2017, in Wyandotte County, Kan.

 

If convicted, they face a penalty of not less than 10 years in federal prison and a fine up to $10 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney Chris Oakley is prosecuting.

 

 Esteban Muniz-Torres, 50, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found Dec. 1, 2017, in Johnson County Kan.

 

If convicted, he faces up to 20 years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Jabari Wamble is prosecuting.

 

Dennis Bowen, 46, Ottawa, Kan., is charged with escaping from federal custody. The crime is alleged to have occurred Nov. 6, 2017, in Leavenworth County, Kan.

 

If convicted, he faces up to five years in federal prison and a fine up to $250,000. The Kansas Bureau of Investigation investigated. Assistant U.S. Attorney David Zabel is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

 

##

WICHITA, KAN. - A former city attorney of Manhattan, Kan., was sentenced Tuesday to 210 months in federal prison on child pornography charges, U.S. Attorney Tom Beall said.

 

Bill Raymond, 55, Andover, Kan., pleaded guilty to three counts of transporting child pornography and one count of possessing child pornography. Raymond admitted that he emailed child pornography to himself using a cellular telephone and a computer on Nov. 9, 2014, Feb. 28, 2015 and May 17, 2015. He also admitted that on July 30, 2015, he possessed child pornography.

 

The crimes occurred in Butler and Riley counties. Raymond became the city attorney in Manhattan after serving as an assistant county counselor in Sedgwick County.

 

Beall commended the FBI and Assistant U.S. Attorney Jason Hart for their work on the case.

WICHITA, KAN. – A Clay Center man was sentenced Thursday to two years on supervised release for selling assets he had pledged as collateral on a federal loan, U.S. Attorney Tom Beall said today. The defendant was ordered to pay approximately $84,594 in restitution.

 

Harold R. Mugler, 64, Clay Center, Kan., pleaded guilty to one count of criminal conversion. In his plea, he admitted that in 2009 in received a $100,000 loan through the U.S. Department of Agriculture’s Farm Service Agency. Over the following years, he sold off various pieces of farm machinery that he had pledged as collateral on the loan. He was behind on his loan payments in 2015 when the government learned of the sales.

 

Beall commended the USDA-OIG and Assistant U.S. Attorney Aaron Smith for their work on the case.

TOPEKA, KAN. – Two Topeka men were indicted Wednesday on charges of robbing a health club where one of them used to work, U.S. Attorney Tom Beall said.

 

Lesley Jamar Terrell, Jr., 33, Topeka, Kan., and George Bernard Phelps, III, 31, Topeka, Kan., are charged with one count of robbery. The indictment alleges that on Nov. 24, 2017, the two defendants robbed the Genesis Health Club at 2909 Southwest 37th Street in Topeka.

 

A criminal complaint in the case alleges that a Genesis employee came upon the two defendants in the lobby of the business while they attempted to pry open a box used for money deposits by members of the club. One of the defendants told the employee the robbers did not want trouble and instructed him to wait in an adjacent room. The defendant stood in the doorway of the room with his hand in the waistband of his pants. The defendants removed cash and checks from the box and then fled.

 

When police arrived, the employee told them one of the robbers resembled a former employee of the business. Investigators identified Terrell as a prior employee of the business who worked as an overnight maintenance worker.

 

If convicted, the defendants face up to 20 years in federal prison and a fine up to $250,000. The Topeka Police Department and the FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

 

 

OTHER INDICTMENTS

 

Xavier Leron Sims, 30, who is in custody, is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred Oct. 21, 2017

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. – Two men who been living in Kansas were indicted today in separate cases on charges of lying in order to become naturalized citizens, U.S. Attorney Tom Beall said.

 

Victor David Garcia Bebek, 45, a native of Peru who has been living in Wichita, was charged with one count of unlawfully obtaining naturalized U.S. citizenship. The indictment alleges Bebek failed to disclose on his application for naturalization that he committed crimes while in the United States, including voter fraud.

 

In April, Bebek pleaded guilty in Sedgwick County District Court to three counts of voting without being qualified. He voted in a 2012 special election, the 2012 general election, and the 2014 general election, according to Kansas Secretary of State Kris Kobach. Kobach said his office learned of the voting fraud after Bebek became a naturalized citizen in February 2017.

 

Terry Kang, 48, a native of India who has been living in Overland Park, is charged with one count of unlawfully obtaining naturalized U.S. citizenship. The indictment alleges he failed to disclose on his application for naturalization that the government previously had initiated proceedings to remove him from the United States. In addition, the indictment alleges he made false statements to the government.

 

If convicted Bebek and Kang face up to 10 years in federal prison, a fine up to $250,000 and revocation of their naturalized citizenship. The Fraud Detection & National Security section of U.S. Citizenship and Immigration Services (DHS) investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

 

OTHER INDICTMENTS

 

Phyllis Lanning, 60, Coffeyville, Kan., is charged with one count of mail fraud. The crime is alleged to have occurred from 2003 to 2017 in Montgomery County, Kan.

 

The indictment alleges that while she worked for Condon National Bank in Coffeyville, Kan., she created and mailed falsified documents in order to conceal the fact she stole $150,000 from an account.

 

If convicted, she faces up to 20 years in federal prison and a fine up to $250,000. The FBI investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

Staci Jo Campbell, 37, Wichita, Kan., and Chet Andell Loudermilk, 46, Wichita, Kan., are charged with one count of possession of stolen mail. The crime is alleged to have occurred in June 2016, in Sedgwick County, Kan.

 

If convicted, they face up to five years in federal prison and a fine up to $250,000. The Sedgwick County Sheriff’s Office investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

Joshua D. Catlin, 23, Florence, Kan., is charged with one count of theft of mail. The indictment alleges that while driving as a contract mail delivery person, he stole cash and gift cards and destroyed mail. The crime is alleged to have occurred in March 2017.

 

If convicted, he faces up to five years in federal prison and a fine up to $250,000. The U.S. Postal Service investigated. AUSA Alan Metzger is prosecuting.

 

Luis Antonio Mendez-Perez, 40, a citizen of Mexico, is charged with one count of unlawful possession of a firearm by an illegal alien, and one count of unlawfully re-entering the United States after being convicted of a felony and deported. He was found in 2017 in Sedgwick County.

 

If convicted, he faces up to 10 years and a fine up to $250,000 on each count. Immigration and Customs Enforcement’s Enforcement Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

Ricardo Daniel Ruiz, 19, El Paso, Texas, is charged with one count of possession of more than 14 pounds of cocaine. The crime is alleged to have occurred Nov. 23, 2017, in Elkhart County, Kan.

 

If convicted, he faces a penalty of not less than 10 years in federal prison and a fine up to $4 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

KANSAS CITY, KAN. –Joseph David Dial, Jr., 52, Belton, Mo., is charged in a federal indictment unsealed today with four counts of major program fraud against the United States and four counts of wire fraud, U.S. Attorney Tom Beall said. The indictment alleges during the period from in or about August 2008, to in or about September 2015, Dial unlawfully devised a scheme to defraud and to obtain money and property by means of material false and fraudulent pretenses, representations and promises, in order to obtain a $40 million Department of Defense contract.

 

The indictment alleges Dial unlawfully formed a pass-through business called United Medical Design Builders, LLC with another person. The company received a contract through the Service-Disabled Veteran-Owned Small Business program that was awarded by the U.S. Army Corps of Engineers for the design and construction of healthcare facilities at Langley AFB, Andrews AFB, Hanscom AFB, and McGuire AFB. The indictment alleges United Medical Design Builders, LLC was not a legitimate Service-Disabled Veteran-Owned Small Business and should not have obtained the contract.

 

If convicted, Dial faces up to 10 years in federal prison on each count of defrauding the government and up to 20 years on each count of wire fraud, as well as fines and forfeiture judgment representing the amount of proceeds obtained by committing the offenses set out in the indictment. Investigative agencies include the Small Business Administration - Officer of Inspector General, General Services Administration - Office of Inspector General, Defense Criminal Investigative Service and the Army CID Major Procurement Fraud Unit. Assistant U.S. Attorney Tris Hunt is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WASHINGTON – A former Kansas bank executive was charged in an indictment filed today for his participation in a bank fraud scheme to obtain a $15 million construction loan from 26 Kansas banks based on allegedly false information contained in the loan documents.

 

Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Special Agent in Charge David Anderson of the Federal Deposit Insurance Corporation Office of Inspector General’s (FDIC-OIG) Kansas City Regional Office, Special Agent in Charge Karl A. Stiften of the Internal Revenue Service Criminal Investigation’s (IRS-CI) St. Louis Field Office, Special Agent in Charge Darrin E. Jones of the FBI’s Kansas City Field Office and Special Agent in Charge Catherine Huber of the Federal Housing Finance Agency Office of Inspector General’s (FHFA-OIG) Central Region Office made the announcement.

 

Troy A. Gregory, 50, of Lawrence, Kansas, was charged in an indictment filed in the District of Kansas with one count of conspiracy to commit bank fraud, four counts of bank fraud, and two counts of false statements. 

 

According to the indictment, Gregory was a bank executive and loan officer who had made millions of dollars in loans to a group of borrowers who were struggling to make payments on the loans.  The indictment alleges that beginning in approximately late 2007, Gregory began the process of making a $15.2 million construction loan to build an apartment complex to that same group of borrowers.  The indictment further alleges that Gregory’s bank shared this loan with 25 other Kansas banks.  Gregory allegedly made or caused others to make false statements to the banks about the strength of the borrowers, the debt status of the apartment property and the existence of approximately $1.7 million in certificates of deposit for collateral on the loan, all to get the loan approved.  Instead of using the loan funds promised for building the apartments, Gregory allegedly immediately diverted over $1 million of the loan to pay for part of the certificates of deposit pledged as collateral, pay off debt on the apartment property and make payments on unrelated loans.  Other Kansas banks that shared in this loan allegedly would not have participated in the loan without the false representations and promises.

 

The indictment alleges that the banks ultimately wrote off millions of dollars on the $15.2 million construction loan.

 

 

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

           

The FDIC-OIG, IRS-CI, FBI and FHFA-OIG are investigating this matter.  Trial Attorney Andrew R. Tyler and Senior Litigation Counsel David A. Bybee of the Criminal Division’s Fraud Section are prosecuting the case.

 

The Fraud Section plays a pivotal role in the Department of Justice’s fight against white collar crime around the country, focusing on cases of national significance and international scope.  Fraud Section prosecutors have vast experience in investigating and prosecuting securities and financial fraud, health care fraud and foreign corruption.  The Section is routinely the national leader in large, sophisticated white collar investigations and prosecutions, frequently in partnership with U.S. Attorneys’ Offices and in coordination with foreign law enforcement agencies.

WICHITA, KAN. – A Sedgwick County man pleaded guilty Thursday to a federal charge of producing child pornography, U.S. Attorney Tom Beall said.

 

Ian Nathaniel Smith, 21, Viola, Kan., pleaded guilty to one count of producing child pornography. In his plea, he admitted he communicated over the internet with a 14-year-old victim in Indiana. On Skype, Smith urged the victim to live stream sex acts. Smith transported the minor to Ohio for the purpose of performing sexual activity. When Smith was arrested, investigators found pornographic images of the victim on Smith’s smartphone.

 

Sentencing is set for Feb. 16. He faces a penalty of not less than 15 years and not more than 30 years in federal prison and a fine up to $250,000.

 

Beall commended the FBI and Assistant U.S. Attorney Jason Hart for their work on the case.

KANSAS CITY, KAN. – A Prairie Village man was indicted Wednesday on charges he robbed a shoe store, and attempted to rob a credit union, U.S. Attorney Tom Beall said.

 

John P. Gail, 49, Prairie Village, Kan., was charged with one count of commercial robbery, and one count of attempted robbery of a Credit Union. The indictment alleges that on Sept. 10, 2017, he robbed Payless Shoe Source at 4824 S. 4th Street in Leavenworth, Kan.

 

In addition, the indictment alleges that on Sept. 11, 2017, Gail attempted to rob the Community America Credit Union at 13590 S. Blackbob in Olathe, Kan.

 

If convicted, he faces up to 20 years in federal prison and a fine up to $250,000 on each count. The FBI, the Leavenworth Police Department and the Olathe Police Department investigated. Assistant U.S. Attorney Tris Hunt is prosecuting.

 

OTHER INDICTMENTS

 

Ronald James McNeil, 25, Charlotte, N.C., and Rock Sarousse Lamartiniere, 24, are charged with one count of wire fraud and one count of aggravated identity theft. The indictment alleges they used false identities to purchase cell phones at discounted prices from AT&T. The crimes are alleged to have occurred Aug. 31, 2017, in Johnson County, Kan.

 

If convicted, they face up to 20 years in federal prison and a fine up to $250,000 on the wire fraud count and two years (consecutive) and a fine up to $250,000 on the identity theft count. The Overland Park Police Department investigated. Assistant U.S. Attorney Chris Oakley is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

KANSAS CITY, KAN. – A former Kansas CPA pleaded guilty Tuesday to filing a false tax return, U.S. Attorney Tom Beall said.

 

Robert M. Purinton, 69, formerly of Overland Park, Kan., now of Rancho Mirage, Calif., pleaded guilty to one count of making a false statement on his 2009 tax return by under-reporting his income by about $202,000.  He agreed to make restitution of $71,543 for the additional taxes due and owing for that year.  He also agreed to make restitution of $34,512 for 2010, although he did not plead guilty to any criminal activity for that year.  During those years, he was a CPA with an accounting firm in Overland Park.

 

  The sentencing date will be set after his presentence report is completed. He faces a maximum penalty of three years in federal prison, a fine up to $250,000, and total restitution of $106,055. Beall commended the Internal Revenue Service and Assistant U.S. Attorney Leon Patton for their work on the case.

KANSAS CITY, KAN. – A $500,000 grant from the justice Department will pay for four police officer positions in Olathe, U.S. Attorney Tom Beall said today.

 

The money comes from the COPS Hiring Program Awards announced Monday by the Justice Department’s Office of Community Oriented Policing Services. The propose of the program is provide funds to state, local and tribal law enforcement agencies to support hiring additional career law enforcement officers to address specific crime problems through community policing strategies.

 

Attorney General Jeff Sessions Monday announced a total of $98.4 million in COPS grants nationwide.

 

“Cities and states that cooperate with federal law enforcement make all of us safer by helping remove dangerous criminals from our communities,” Sessions said.

 

The complete list of award recipients can be found at https://www.cops.usdoj.gov/pdf/2017AwardDocs/chp/Award_List.pdf

 

The COPS Office awards grants to hire community policing officers, develop and test innovative policing strategies, and provide training and technical assistance to community members, local government leaders, and all levels of law enforcement. Since 1994, the COPS Office has invested more than $14 billion to help advance community policing.

KANSAS CITY, KAN. – An Illinois man pleaded guilty Monday to being the getaway driver in a $53,000 hold up at a Verizon store in Village West, U.S. Attorney Tom Beall said. The robbers held store employees at gunpoint and bound them with zip ties.

 

Terry Curtis, 34, Rockford, Il., pleaded guilty to one count of commercial robbery. In his plea, he admitted that on Sept. 14, 2016, he was involved when four men robbed the Verizon Wireless store at 10621 Village West Parkway. Two of the robbers entered the store, followed two minutes later by the other two. The robbers locked the door and ordered the employees and a customer into a break room. The robbers ordered them to lay face down on the floor and tied their hands behind their backs. The robbers forced an employee to open a safe before they fled the store with phones and cash worth $53,000. Eventually, an employee managed to get loose and call police.

 

Investigators used surveillance photos from the robbery to tie the Kansas City robbery to a similar robbery weeks earlier at an AT&T Store in Rochester, Minn. They also received an anonymous call that led them to one of the co-defendants who was on parole in Illinois.

 

During the investigations, agents learned that some of the defendants in the Verizon robbery were part of a group involved in dozens of similar robberies in several states.

 

Curtis’ sentencing will be set for a later date. Both parties have agreed to recommend 72 months in federal prison.

 

Co-defendants who are awaiting trial include:

Mario Lambert, 33, Rockford, Il.

Sir T. Love, 32, Rockford, Il.

Domonique V. Walker, 26, Rockford, Il.

Sharod Pitts, 35, Chicago, Il.

 

Beall commended the Kansas City, Kan., Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Assistant U.S. Attorney Terra Morehead for their work on the case.

 

 In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. – A former Wichita restaurant owner was sentenced Monday to 108 months in federal prison for drug trafficking, U.S. Attorney Tom Beall said.

 

Gerald Beasley, 62, Wichita, Kan., the former owner of Tiara’s Place, pleaded guilty to one count of possession with intent to distribute cocaine and one count of unlawful possession of a firearm in furtherance of drug trafficking.

 

In his plea, Gerald Beasley admitted he stored cocaine and other narcotics in a residence in the 2400 block of North Piatt Street in Wichita. He met with buyers both at the residence and the restaurant at 1339 N. Hillside. He carried a High Standard derringer handgun to protect himself during drug transactions.

 

In his plea agreement, Gerald Beasley agreed to forfeit his home in Andover, his restaurant, a number of real estate properties, more than $75,000 in cash and bank accounts with a value of more than $75,000, as well as other assets.

 

In exchange for his guilty plea, the United States dismissed 20 additional counts against Mr. Beasley, including drug offenses, bank fraud, program fraud, money laundering, and firearm offenses. 

 

Co-defendants include:

Antoine Beasley, 38, Wichita, who was sentenced to 63 months in federal prison.

Gerald Wilson, 46, Wichita, Kan., was sentenced to 70 months in federal prison.

Larry Reed, 59, who was sentenced to two years in federal prison.

Carlos Beasley, 43, Wichita, Kan., who was sentenced to two years on supervised probation.

Helen Beasley, 59, Wichita, who was sentenced to two years on supervised probation.

Terry Beasley, 64, Wichita, Kan., who is set for sentencing Jan. 10.

Herbert Jones, 55, Wichita, Kan., who is set for sentencing Jan. 8.

Stephen Smallwood, 69, Wichita, Kan., who is set for sentencing Dec. 6.

Brandon Smith, 46, Wichita, Kan., who is set for sentencing Dec. 6.

 

Beall commended the Wichita Police Department, the Sedgwick County Sheriff’s Office, the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Internal revenue Service, the Sedgwick County District Attorney’s Office, Assistant U.S. Attorney Debra Barnett and Assistant U.S. Attorney Michelle Jacobs for their work on the case.

WICHITA, KAN. – A Cheyenne County man was sentenced Monday to 25 years in federal prison for producing child pornography, U.S. Attorney Tom Beall said.

 

Brett Nolan Cico, 32, St. Francis, Kan., pleaded guilty as charged to three counts of producing child pornography and three counts of sexual exploitation of a minor while registered as a sex offender. Two of the victims were 14 years old and the other victim was 15 years old.

 

Beall commended the Kansas Bureau of Investigation, Homeland Security Investigations and Assistant U.S. Attorney Jason Hart for their work on the case.

 

WICHITA, KAN. – A Coffeyville man who tried to buy an explosive on the internet was sentenced Friday to two years in federal prison, U.S. Attorney Tom Beall said.

 

Carlos Francisco Martin, 19, Coffeyville, Kan., pleaded guilty to one count of attempting to obtain an explosive with intent to destroy property. In his plea, he admitted he ordered an explosive from an internet site where users seek to remain anonymous and purchases are paid for in bitcoins.

 

Investigators tracked Martin’s purchases on the internet site, which included more than $4,000 worth of illegal drugs such as MDMA, commonly known as ecstasy. In his plea, Martin admitted he tried to buy the explosive for the purpose of intimidating a rival drug dealer.

 

Beal commended the FBI, Assistant U.S. Attorney Tony Mattivi and Trial Attorney Rebecca Magnone of the Justice Department’s Counterterrorism Section for their work on the case.

WICHITA, KAN. - A Georgia man was sentenced Wednesday to 27 months in federal prison for his part in an e-mail spoofing scheme that cost Sedgwick County more than $566,000, U.S. Attorney Tom Beall said.

 

George S. James, 49, Brookhaven, Ga., pleaded guilty to one count of wire fraud.

 

In his plea, James admitted that on Oct. 7, 2016, Sedgwick County sent approximately $566,088 to his bank account at a Wells Fargo bank in Georgia. James transferred part of the money he received from Sedgwick County to a bank account in Shanghai, China, and part of the money to an account at Deutsche Bank in Bremen, Germany. James also spent some of the money.

 

In his plea, James denied that the fraud scheme was his idea. He said that on Sept. 23, 2016, he was contacted by a person identified in court records as A.H., who asked to deposit some money into James’ account at Wells Fargo. James said he knew A.H. was engaged in fraud, but James denied knowing that Sedgwick County was the victim.

 

In his plea, James said it was A.H. – or someone working with A.H. – who sent an email to Sedgwick County on Sept. 23, 2016, purporting to be from Cornejo and Sons, LLC, and requesting the county send future payments to a new account number at Wells Fargo. On Oct. 7, 2016, the county sent $566,088 to James’ account at Wells Fargo. The county learned later that Cornejo did not request the change of account and did not receive the payment.

 

Beall commended the FBI, the Sedgwick County Sheriff’s Office, the Wichita Police Department and Assistant U.S. Attorney Alan Metzger for their work on the case.

WICHITA, KAN. – A Wichita woman was sentenced Wednesday to seven years in federal prison for robbing three local businesses, U.S. Attorney Tom Beall said.

 

Christina A. Messerschmidt, 26, Wichita, Kan., pleaded guilty to committing the following robberies:

 

• June 14, 2017: Kwik Shop at 2809 E. Douglas in Wichita. She threatened store employees with a knife and took money from the register.
• June 13, 2017: Patricia’s, 6143 W. Kellogg in Wichita. She threatened to strangle an employee and took money from the register.
• Dec. 16, 2016: Intrust Bank at 1544 S. Webb. She gave a teller a note saying, “Give me $1,000 or I will shoot you.” She was arrested after a standoff with police at an apartment near the bank.

 

Beall commended the FBI, the Wichita Police Department and Assistant U.S. Attorney Alan Metzger for their work on the case.

KANSAS CITY, KAN. – A former civilian hospital employee was sentenced today to the statutory maximum of 20 years in federal prison plus 3 years of supervised release for attacking a woman whom he set on fire, U.S. Attorney Tom Beall said. In addition the Defendant was ordered to pay restitution in the amount of $3,464,965.80 to the victim, Lieutenant Katie Ann Blanchard.

 

In August, a jury found Clifford Currie, 55, Leavenworth, Kan., guilty of one count of assault with intent to commit murder.

 

During trial, prosecutors presented evidence that on Sept. 7, 2016, Currie threw gasoline or some other inflammable liquid on his supervisor, Katie Ann Blanchard, lit her on fire and assaulted her with a straight edge razor and scissors. A co-worker came to Blanchard’s aid when she heard screams and saw Blanchard on fire from the chest up. Currie was subdued by hospital employees and then arrested

 

Beall commended the FBI, the U.S. Army Military Police, Assistant U.S. Attorney Kim Flannigan and Special Assistant U.S. Attorney James Ward for their work on the case.

WICHITA, KAN. – A Wellington woman was indicted Wednesday on federal charges of collecting more than $92,000 in Social Security disability benefits while she was working, U.S. Attorney Tom Beall said. In addition, she was charged with misusing a credit card belonging to her church to obtain cash and buy merchandise for herself.

 

Amy D. McLain, 49, Wellington, Kan., was charged with one count of Social Security fraud, one count of theft of government funds, two counts of making false statements and one count of wire fraud.

 

Her husband, Jeffrey L. McLain, 48, Wellington, Kan., was charged with one count of Social Security fraud and one count of theft of government funds. Her employer, Scott Kreifels, 57, Wellington, Kan., was charged with one count of Social Security fraud and one count of theft of government funds.

 

The indictment alleged that Amy McClain was working for Kreifels Communications and Rural 2.4 Ghz, Inc., both owned by Kreifels, while receiving disability benefits. The three defendants agreed that Amy McLain’s paychecks would be issued in her husband’s name. While receiving benefits, Amy McLain filed federal paperwork stating that she did not have a job.

 

In addition, the indictment alleges Amy McLain used a credit card belonging to the First Baptist Church in Wellington to obtain cash and to buy merchandise including makeup, perfume, purses and meals.

 

Upon conviction, the crimes carry the following penalties:

Social Security fraud, theft of government funds, making a false statement: Up to five years in federal prison and a fine up to $250,000 on each count.

Wire fraud: Up to 20 years in federal prison and a fine up to $250,000.

 

The Social Security Administration investigated. Assistant U.S. Attorney Alan Metzger is prosecuting.

 

 

OTHER INDICTMENTS

 

 

Jerry D. Burns, 55, Wichita, Kan., was charged with drug trafficking in a 15-count indictment.

 

Charges included possession with intent to distribute methamphetamine, unlawful possession of firearms following a felony conviction, unlawful possession of firearms in furtherance of drug trafficking and possession with intent to distribute marijuana. The crimes were alleged to have occurred in 2017 in Sedgwick County, Kan.

 

Upon conviction, the crimes carry the following penalties:

          Possession with intent to distribute more than 50 grams of methamphetamine: Not less than 10 years in federal prison and a fine up to $10 million.

          Unlawful possession of a firearm: Up to 10 years and a fine up to $250,000.

          Unlawful possession of a firearm in furtherance of drug trafficking: Not less than five years and a fine up to $250,000.

          Possession with intent to distribute more than five grams of methamphetamine: Not less than five years and not more than 40 years and a fine up to $5 million.

          Possession with intent to distribute marijuana: Up to 20 years and a fine up to $1 million.

 

The Wichita Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

Julian Lopez, Jr., 39, Wichita, Kan., was charged with one count of possession with intent to distribute cocaine, one count of unlawful possession of a firearm following a felony conviction and one count of unlawful possession of a firearm in furtherance of drug trafficking. The crimes are alleged to have occurred Oct. 19, 2017, in Sedgwick County, Kan.

 

Upon conviction, the crimes carry the following penalties:

          Possession with intent to distribute cocaine: Up to 20 years in federal prison and a fine up to $1 million.

          Unlawful possession of a firearm by a felon: Up to 10 years and a fine up to $250,000.

          Unlawful possession of a firearm in furtherance of drug trafficking: Up to 10 years and a fine up to $250,000.

 

The Wichita Police Department and the Drug Enforcement Administration investigated. Assistant U.S. Attorney Lanny Welch is prosecuting.

 

         

Matthew Lee Fleming, 27, Wichita, is charged with one count of unlawful possession of a firearm following a felony conviction. The crime is alleged to have occurred July 10, 2017, in Wichita, Kan.

 

          If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Matt Treaster is prosecuting.

 

Joseph Shane Allen, 42, Pierceville, Kan., is charged with drug trafficking in a six-count indictment.

 

Charges include possession with intent to distribute methamphetamine, unlawful possession of a firearm in furtherance of drug trafficking, unlawful possession of ammunition following a felony conviction, possession of materials and equipment used to manufacture methamphetamine and possession of chemicals used to manufacture methamphetamine. The crimes are alleged to have occurred Sept. 28, 2017 in Pawnee County, Kan.

 

Upon conviction, the crimes carry the following penalties:

           Possession with intent to distribute methamphetamine: Not less than five years and not more than 40 years and a fine up to $5 million.

          Possession of a firearm in furtherance of drug trafficking: Not less than five years and a fine up to $250,000.

          Unlawful possession of ammunition following a felony conviction: Up to 10 years and a fine up to $250,000.

          Possession of materials or equipment to produce methamphetamine: Up to 10 years and a fine up to $250,000.

           Possession of chemicals used to produce methamphetamine: Up to 20 years and a fine up to $250,000.

 

The Finney County Sheriff’s Office and the Pawnee County Sheriff’s Office investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting.

 

Juan Jose Soto-Urena, 35, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found Oct. 13, 2017, in Sedgwick County, Kan.

 

If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement’s Enforce Removal Operations investigated. Assistant U.S. Attorney Brent Anderson is prosecuting.

 

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

WICHITA, KAN. - A federal judge Tuesday ordered a Wichita man to pay the government back for his court-appointed attorney, U.S. Attorney Tom Beall said.

 

Antoine Beasley was sentenced earlier this month to 63 months in federal prison on gun and drug charges. After his indictment in April 2014, Beasley declared himself indigent and he was assigned a court-appointed attorney.

 

After sentencing, the court learned that while the case was pending Beasley purchased a $76,715 2015 Audi A7 3.0T Quattro. On his credit application, he said he had a monthly income of $10,000, not counting his wife’s income. Beasley made payments by going to Dillions with cash and buying money orders made out to his lender.

 

On Tuesday, U.S. District Judge J. Thomas Marten ordered Beasley to pay $34,640 to the federal treasury – the amount Beasley paid on the Audi.

 

Beall commended the Bureau of Alcohol, Tobacco, Firearms and Explosives and Assistant U.S. Attorney Michelle Jacobs for their work on the case.