Eastern District of Kentucky

LEXINGTON, Ky. – Franklin Fletcher, 55, of Oil Springs, Ky., was sentenced on Friday to 65 months in federal prison, by Chief United States District Judge, Danny C. Reeves, for wire fraud and aggravated identity theft.  Fletcher was also ordered to pay $374,192.89 in restitution.

Fletcher pleaded guilty on May 9, 2019, and admitted to embezzling nearly $375,000 from his former employer, NYTIS Exploration, from September 2012 until March 2018.  According to court records, Fletcher abused his authority as an Accounting Manager to generate checks that he would deposit into his own accounts.  He engaged in a complicated series of actions to hide the stolen money from his employer.  He further concealed his crime by writing the checks in another individual’s name and forging her signature on the endorsement line.

According to court documents, this was not Fletcher’s first act of embezzlement.  Records indicate that from some point until 2009, Fletcher embezzled nearly $1,000,000 from his then-employer, again abusing his position in accounting at that Kentucky energy company.  Fletcher paid a significant portion of the money he embezzled from NYTIS Exploration against the restitution agreement he had entered into with his prior employer.

Under federal law, Fletcher must serve 85 percent of his prison sentence, and upon his release, he will be under the supervision of the United States Probation Office for three years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky and Richard Ferretti, Special Agent in Charge for the United States Secret Service, jointly announced the sentence.  

LONDON, Ky. – Pete Anthony Tyndale, 47, of Hollywood, Florida, was sentenced to 29 years of imprisonment by United States District Judge Robert E. Wier for conspiring to distribute oxycodone and other drugs, and for money laundering.

Tyndale was the co-owner of the Tennessee Pain Institute (TPI), a pain clinic that operated from 2011 to 2016 near Chattanooga. After a month-long trial earlier this year in federal court, a jury convicted Tyndale, his business partner Anwar Mithavayani, and physician Timothy Gowder, of operating TPI as a pill mill, and for money laundering related to proceeds from TPI. The three men were responsible for the illicit distribution of more than 1.6 million oxycodone 30mg pills, and hundreds of thousands of other narcotic pills and sedative pills, such as Xanax.  Approximately half of TPI’s pill customers were traveling from eastern Kentucky.

In earlier proceedings this month, Judge Wier sentenced Gowder to 21 years of imprisonment and Mithavayani to 25 years of imprisonment. A third co-defendant, James Bradley Combs, 41, of Woodbine, Kentucky, received a 151-month sentence. Combs was convicted of possessing with intent to distribute oxycodone, and he was a regular customer at TPI. Another co-defendant, Larry Karr of Keavy, Kentucky, pled guilty to the oxycodone conspiracy charge in May of 2018 and was later sentenced to 108 months in prison.

Under federal law, Tyndale and his co-defendants each must serve 85 percent of their prison sentence. Upon release, they will be under the supervision of the United States Probation Office for three years. 

“Today’s sentencing demonstrates our commitment to holding accountable, to the full extent of the law, those who would profit from the illicit distribution of highly addictive drugs like oxycodone,” said United States Attorney Robert M. Duncan, Jr. “Hiding behind the ruse of a ‘medical clinic’ will not protect any drug trafficker from facing the consequences of the substantial harm caused by their actions.”

U.S. Attorney Duncan, Special Agent in Charge D. Christopher Evans of the Drug Enforcement Administration’s Louisville Field Division, Special Agent in Charge Matthew Line of the Internal Revenue Service, Criminal Investigation Division, Andy Beshear, Kentucky Attorney General, and Richard W. Sanders, Commissioner of Kentucky State Police jointly announced the sentences.

The investigation was conducted by the DEA, the IRS and the Kentucky Attorney’s General Office as part of an Organized Crime Drug Enforcement Task Force. The U.S. Attorney’s Office was represented in the case by Assistant U.S. Attorney Gregory Rosenberg.  

LEXINGTON, Ky. – On August 30, 2019, Marcellis Means, 23, of Lexington, Kentucky, plead  guilty to one count of being a convicted felon in possession of a firearm in violation of 18 U.S.C. § 922(g) before U.S. Chief Judge Danny C. Reeves.

As part of his plea, Means admitted that on July 10, 2019, he was unlawfully in possession of a firearm after previously being convicted of a felony offense. On that date, a Lexington Police Officer made contact with Means and another occupant of a parked vehicle when Means exited the vehicle and began to flee from the officer. As part of his plea agreement, Means admitted that while fleeing, he attempted to get rid of the firearm which was eventually recovered by police. The firearm was loaded with one round of ammunition chambered.

The investigation was conducted by the Lexington Police Department in conjunction with the Kentucky State Police and agents with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, Stuart L. Lowery, Special Agent in Charge, ATF, Louisville Field Division, Lawrence Weathers, Chief of Police, Lexington Police Department, and Richard W. Sanders, Commissioner, Kentucky State Police, jointly made the announcement.

Means is scheduled to be sentenced on December 20, 2019. He faces up to 10 years in prison and a maximum fine of $250,000. However, any sentence will be imposed by the Court after consideration of the United States Sentencing Guidelines and applicable federal statutes.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

LEXINGTON, Ky. — Brandon Terelle Ewing, age 35, of St. Louis, was sentenced yesterday, to 40 months in federal prison, by United States District Judge Karen K. Caldwell, for an assault resulting in serious bodily injury.  Judge Caldwell also ordered Ewing to pay $12,599.48 in restitution to the victim’s family.

Ewing previously admitted that, on January 18, 2018, at the Federal Medical Center in Lexington, he slapped the victim and used his forearm to push the victim backwards, causing the victim to hit his head on the bed railing.  Ewing also admitted that, as a result of this conduct, the victim required medical treatment for a closed head injury, which caused the victim to fall into a coma, and ultimately resulted in the victim’s death.  Ewing pleaded guilty to the charge in April of 2019.         

Under federal law, Ewing must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and James Robert Brown, Jr., Special Agent in Charge, FBI (Louisville Division), jointly made the announcement.

The investigation was conducted by the FBI.  The United States was represented by Assistant United States Attorneys Ron L. Walker, Jr. and Kyle M. Melloan.

 

LONDON, Ky. – Eric “Big E” Flores, 38, of San Angelo, Texas, and Salomon Martinez, 44, of Eagle Pass, Texas, were sentenced this week, to 110 and 100 months respectively, by United States District Judge Robert E. Wier, for assaulting an inmate with a dangerous weapon.  Co-defendants Rodney “Joker” Galindo, 38, of Odessa, Texas, and Michael “Taz” Morin, 52, of Austin, Texas, were sentenced to 300 and 262 months respectively, for attempted murder and possession of a prohibited object in the facility.  Judge Wier also ordered Flores and Martinez pay victim restitution in the amount of $3,955.57.  Galindo and Morin were ordered to pay victim restitution in the amount of $611,992.  

Flores and Martinez were convicted by a federal jury in April of 2019.  Galindo and Morin pled guilty in March of 2019.  The evidence presented established that the Defendants were members of the MEXIKANEMI, Texas Mexican Mafia, and participated in the attempted murder and assault of two Arizona Mexican Mafia members, within United States Penitentiary (USP) Big Sandy.  Both victims were repeatedly stabbed with metal shanks, in a cell block on June 17, 2018.  The first victim sustained permanent and life-threatening injuries, including a depressed skull fracture and traumatic brain injury.  The second victim sustained serious injuries that included a fractured scapula and significant stab wounds.  

Under federal law, the Defendants must serve 85 percent of their prison sentences; and upon their release, they will be under the supervision of the United States Probation Office for three years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky and Hector Joyner, Warden of USP Big Sandy, jointly made the announcement.  The investigation was conducted by the USP Big Sandy Special Investigative Services Office.  The United States was represented by Assistant United States Attorney Jenna E. Reed. 

LEXINGTON, Ky. – Robert M. Duncan, Jr., the U.S. Attorney for the Eastern District of Kentucky, recognizes and commends the efforts of the DEA, for its Operation Crystal Mountain.  Operation Crystal Mountain was a sweeping methamphetamine enforcement action that culminated in several impactful investigations this year.    Since January, DEA special agents from the Louisville Field Division, with support from state and local law enforcement agencies across the region, have arrested 235 individuals on federal drug-related charges, seized more than $800,000.00 in cash and 52 firearms, and seized significant quantities of heroin, fentanyl, and other drugs.  During this same timeframe, DEA assisted its state and local counterparts with the arrest of 140 additional offenders, on state-level drug charges.

“Methamphetamine is a dangerous drug and this enforcement operation demonstrates the hard work of our law enforcement partners, in their efforts to diminish its impact in Southeastern Kentucky and throughout the region,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky.  “Our Office remains committed to using all available resources to combat methamphetamine trafficking.  Working with the DEA and our state and local law enforcement partners, we will continue to prioritize the prosecution of these important cases and work to make our communities safer.”

For more information about the DEA and Operation Crystal Mountain, go to: https://www.dea.gov/press-releases/2019/08/20/dea-targets-methamphetamine-three-states-operation-crystal-mountain.

LEXINGTON, Ky. – Richard Eugene Derringer, 47, previously of Junction City, Kentucky was convicted by a jury, following a three-day trial, on Thursday, before Senior United States District Judge Joseph M. Hood.  Derringer was found guilty of using a minor to engage in sexually explicit conduct, for the purpose of producing child pornography; conspiracy to use a minor to engage in sexually explicit conduct, for the purpose of producing child pornography; possession of child pornography; and distribution of methamphetamine.  Derringer was acquitted of one count of attempted distribution of child pornography.

According to the evidence at trial, Jacquolyn Walls-Land, who previously pleaded guilty to one count of using a minor to engage in sexually explicit conduct for the purpose of producing child pornography, took videos of the minor female victim while Derringer sexually abused the victim.  The sexual abuse, and recording of it, occurred on March 11, 2018.  The evidence established that Derringer forced the minor victim to smoke methamphetamine with him, on multiple occasions, during an approximate 3-hour period while the sexual abuse occurred.  Derringer even took hits of the methamphetamine himself and then exhaled into the minor victim’s mouth.  The minor victim reported the sexual abuse and forced drug use to her mother, approximately 8 hours after the abuse ended, and the minor victim was taken to a local hospital, where she tested positive for methamphetamine. 

Derringer is scheduled to be sentenced on November 25, 2019.  He faces a mandatory minimum sentence of fifteen years in prison, and up to 30 years, on each of the conspiracy and production counts, up to 10 years on the possession of the visual depictions of the minor engaging in sexually explicit conduct, and not more than 20 years for the distribution of methamphetamine.  He also faces fines of not more than $250,000 on the production-related offenses and $2,000,000 on the distribution of methamphetamine conviction.  Additionally, he faces a mandatory minimum of five years, and up to life, of supervised release, following the service of his prison sentence.  However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky: James Robert Brown, Jr., Special Agent in Charge, Federal Bureau of Investigation; and Richard Sanders, Commissioner, Kentucky State Police, jointly announced the jury’s verdict. 

The investigation was conducted by the FBI and Kentucky State Police.  Assistant U.S. Attorneys David Marye and Mary Melton represented the United States. 

 

LEXINGTON, Ky. – 2nd Chance, PLLC (“2nd Chance”), a substance abuse treatment center in Lexington, has agreed to pay $200,494 to resolve civil allegations that it violated the False Claims Act, a federal law that prohibits causing the submission of false or fraudulent claims to the federal government. 

According to the settlement agreement, the United States alleged that 2nd Chance caused the submission of false claims to the Kentucky Medicaid program through its referral of urine drug testing services to Compliance Advantage, LLC, a toxicology laboratory in Nicholasville, Kentucky known as “CAL Lab.”  CAL Lab provided 2nd Chance with a chemistry analyzer, which is a valuable piece of laboratory equipment that enabled 2nd Chance to perform some urine drug testing on-site beginning on or around October 3, 2016.  On November 29, 2016, CAL Lab and 2nd Chance entered into a lease agreement that required 2nd Chance to pay CAL Lab a monthly fee for use of the analyzer.  But, 2nd Chance did not make any payments for use of the analyzer until March 14, 2017.

Accordingly, for a five-month period, 2nd Chance received the benefit of the analyzer without paying for it.  The United States alleged this was a substantial benefit to 2nd Chance:  not only did 2nd Chance receive the benefit of the test results for use in patient care, 2nd Chance also received over $400,000 from Kentucky Medicaid for drug tests performed on the analyzer during this period. 

For its part, CAL Lab received referrals for more complex drug testing from 2nd Chance’s physicians.  CAL Lab then submitted claims for payment for that testing to Kentucky Medicaid, totaling close to $90,000.  According to the settlement agreement, the United States alleged that these claims were false, because they were tainted by 2nd Chance’s acceptance and use of the chemistry analyzer without making lease payments to CAL Lab in violation of the Anti-Kickback Statute, a federal law that prohibits healthcare providers from accepting anything of value in exchange for the referral of services paid for by federal health insurance programs, including Kentucky Medicaid. 

“Sweetheart deals paid for by taxpayers, as the Government alleged in this case, will not be tolerated,” said Derrick Jackson, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “We will work with our law enforcement partners to investigate and prosecute organizations entering into such illicit arrangements.”   

This case is part of a larger investigation into CAL Lab and affiliated individuals and entities.  Earlier this year, in a criminal matter, Samuel L. Ford and Dinesh Goyal pled guilty to conspiracy to commit an offense against the United States in connection with their illegal billing arrangement with CAL Lab.  Specifically, Ford, Goyal, and CAL Lab’s owner, Mason Routt, agreed that urine drug tests referred to and performed by CAL would be billed to certain federal health insurance programs using another laboratory’s billing information in order to evade payment restrictions placed on CAL by those insurers.  Earlier this week, Mr. Ford was sentenced to 24 months in federal prison and 36 months supervised release for his role in this scheme.  Mr. Goyal is scheduled to be sentenced on October 15, 2019.

In June 2018, CAL Lab agreed to a civil settlement with the United States that included the entry of a civil judgment against it and in favor of the United States in the amount of $2,816,015.  As part that settlement, CAL Lab admitted that it violated the False Claims Act by knowingly failing to return to federal health insurance programs overpayments it received for specimen validity testing – a service not covered by Medicare or Kentucky Medicaid.

The Government’s work in this investigation illustrates its commitment to combatting health care fraud, waste, and abuse.  Tips from all sources about potential fraud, waste, and abuse can be reported to the U.S. Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477). 

The case against 2nd Chance was investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services, Office of Inspector General, and the U.S. Attorney’s Office for the Eastern District of Kentucky.  Assistant United States Attorney Christine Corndorf represented the United States.  The claims resolved by the settlement with 2nd Chance are allegations only; there has been no determination of liability.

LEXINGTON, Ky. – Jameel Sleet, 18, of Lexington, was sentenced today, to 60 months in federal prison, by United States District Judge Danny C. Reeves, for possession with intent to distribute fentanyl.

In November 2018, Sleet was stopped by Lexington Police, who found him with approximately 40 grams of fentanyl, 39 grams of cocaine, and 16 grams of crack cocaine.  In his plea agreement, Sleet admitted that he intended to distribute the drugs.  Sleet pleaded guilty in April 2019.           

Under federal law, Sleet must serve 85 percent of his prison sentence and will be under the supervision of the U.S. Probation Office for four years following his release.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; D. Christopher Evans, Special Agent in Charge of the DEA; and Lawrence Weathers, Chief of the Lexington Police Department, jointly announced the sentence.

The investigation was conducted by the U.S. Drug Enforcement Administration and the Lexington Police Department. The United States was represented by Assistant U.S. Attorney David Kiebler.

This case was prosecuted as part of the Organized Crime and Drug Enforcement Task Force’s (OCDETF) Operation Synthetic Opioid Surge (SOS), a Department of Justice initiative designed to target trafficking of dangerous synthetic opioids.

LEXINGTON, Ky. – Maurice Love, 21, of Lexington, pleaded guilty in federal court today, before U.S. District Judge Danny C. Reeves, to possession with the intent to distribute fentanyl.             

As part of his guilty plea, Love admitted that, on February 8, 2019, he possessed 83 grams of fentanyl, $2,620 in cash, a digital scale, and powder used to mix the fentanyl prior to distribution.  Love also admitted that he intended to distribute the fentanyl to others.  Love was indicted in May of 2019.           

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; D. Christopher Evans, Special Agent in Charge of the DEA; and Lawrence Weathers, Chief of the Lexington Police Department, jointly announced the guilty plea.

The investigation was conducted by the U.S. Drug Enforcement Administration and the Lexington Police Department.  The United States was represented by Assistant U.S. Attorney David Kiebler. 

Love is scheduled to be sentenced on December 6, 2019.  He faces up to 40 years in prison and a maximum fine of $5,000,000.  However, any sentence will be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the federal statutes.

This case was prosecuted as part of the Organized Crime and Drug Enforcement Task Force’s (OCDETF) Operation Synthetic Opioid Surge (SOS), a Department of Justice initiative designed to target trafficking of dangerous synthetic opioids.

LEXINGTON, Ky. – Marquis Benjamin Lewis, 41, of Lexington, was sentenced to 87 months in federal prison today, by United States District Judge Danny C. Reeves, after pleading guilty to possessing cocaine and mixtures of heroin and fentanyl with the intent to distribute them, possessing a firearm as a convicted felon, and possessing a firearm in furtherance of drug trafficking.

On October 24, 2018, officers with the Lexington Police Department executed a search warrant at Lewis’s residence in Lexington.  During the search, officers located quantities of cocaine and mixtures of heroin and fentanyl, packaged separately for distribution, along with various items of drug paraphernalia.  In addition to the narcotics, officers also located a total of four firearms, two of which were stolen, dispersed throughout Lewis’s residence and vehicle.  Lewis had a prior felony conviction and was prohibited from owning or possessing a firearm.

Under federal law, Lewis must serve 85 percent of his sentence.  Upon completion of his imprisonment, he will be under the supervision of the United States Probation Office for a period of three years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart L. Lowery, Special Agent in Charge, ATF, Louisville Field Division; and Lawrence Weathers, Chief of the Lexington Police Department, jointly made the announcement.

ATF and the Lexington Police Department conducted the investigation. The United States was represented by Assistant United States Attorney Francisco Villalobos II.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

ASHLAND, Ky. – Michael Anthony Wheeler, owner of Tri-State Lawn Care Inc. (Tri-State), has been sentenced to serve five years on unsupervised probation and ordered to pay $327,087 in back wages to 17 employees, for violating requirements of the Fair Labor Standards Act (FLSA) and the H-2A visa program.

According to his plea agreement, Wheeler pleaded guilty to willful violations of the FLSA’s overtime requirement and eight counts of making false statements on his H-2A applications.  In addition, Tri-State and Wheeler agreed to a 10-year H-2A debarment, five years of third party monitoring, and $125,000 in fines and money judgments.

Tri-State – a landscaping, construction, flooring, heating and air company – provides residential and commercial services to Ashland, Huntington, West Virginia, and Portsmouth, Ohio.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Cheryl M. Stanton, Wage and Hour Administrator, U.S. Department of Labor’s Wage and Hour Division; Patrick S. Mills, Special Agent in Charge of the Chicago Field Office, U.S. State Department's Diplomatic Security Service; John Condon, Special Agent in Charge, Homeland Security Investigations and Richard Sanders, Commissioner, Kentucky State Police, jointly announced the sentence. 

The investigation was conducted by the U.S. Department of Labor, including its Wage and Hour Division, Office of the Inspector General, and Office of the Solicitor, U.S. Department of State’s Diplomatic Security Service, Homeland Security Investigations and the Kentucky State Police.  The United States was represented by Assistant United States Attorneys Hydee Hawkins and David Marye.

ASHLAND, Ky. – An Ashland addiction treatment specialist, Dr. Rose O. Uradu, and her substance abuse treatment center, Ultimate Care Medical Services, LLC d/b/a Ultimate Treatment Center, have agreed to pay $1.4 million to resolve civil allegations that they violated the Controlled Substances Act, and defrauded the Medicare and Kentucky Medicaid programs. 

This settlement resolves a civil lawsuit alleging that Ultimate Treatment Center, at the direction of Dr. Uradu, sought and received payments from Medicare and Kentucky Medicaid for services that were not actually provided to patients.  According to the Complaint, between January 2013 and September 2014, defendants billed these government programs for “evaluation and management” services, purportedly provided to patients who visited the clinic to receive daily methadone doses.  To be reimbursed by Medicare and Kentucky Medicaid, evaluation and management services should include performance of an examination of the patient, a patient history, and medical decision-making.  The United States alleged that Ultimate Treatment Center did not actually perform these services when patients received their methadone doses, but falsely documented the performance of these services, in the patients’ medical records, in order to create the false appearance that the reimbursement was justified.  

The United States further alleged that, during the period July 2013 to December 2014, defendants billed Medicare and Kentucky Medicaid for complex urine drug testing that the clinic’s equipment was incapable of performing.  The United States contended that Defendants’ submission of claims to Medicare and Kentucky Medicaid for services not provided as billed violated the False Claims Act, a federal law the prohibits submitting false or fraudulent claims for payment to the government.

In addition to false claims, the United States alleged that Dr. Uradu issued buprenorphine prescriptions to more patients than permitted by law for a three-month period in 2014.  Buprenorphine is marketed under the brand names Suboxone and Subutex, and is used medically in the treatment of opioid addiction.  Because buprenorphine has the potential for diversion and abuse by recreational users, it is a controlled substance regulated by law.  Dr. Uradu was only permitted to treat 100 patients with buprenorphine drug products, but repeatedly exceeded her patient limit.  According to the settlement agreement, the United States alleged that Dr. Uradu violated the Controlled Substances Act each time she wrote a prescription over her limit. 

The Government’s work in this investigation illustrates its commitment to combating health care fraud and violations of controlled substances laws.  Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the U.S. Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).  Tips about possible violations of controlled substances laws can be reported at www.dea.gov/submit-tip.

The case against Dr. Uradu and Ultimate Treatment Center was investigated by the U.S. Drug Enforcement Administration, Federal Bureau of Investigation, and the Kentucky Attorney General’s Medicaid Fraud and Abuse Control Unit.  The U.S. Department of Health and Human Services, Office of Inspector General assisted with the litigation.  Assistant United States Attorneys Christine Corndorf and Meghan Stubblebine handled the matter for the United States.

The case is captioned United States v. Rose O. Uradu, M.D., et al., Case No. 0:18-cv-00066-HRW. The claims resolved by the settlement with Dr. Uradu and Ultimate Treatment Center are allegations only, and there has been no determination of liability.

Defendant was converting funds for personal care patients to his personal use.

 

ASHLAND, Ky. – Today, an Ashland man admitted in federal court that he unlawfully used representative payee funds, which were received on behalf of individuals living in the Artrip Personal Care Home in Ashland, Kentucky.

Mitchell Allen Artrip, 68, pleaded guilty to one count of representative payee fraud before United States District Court Judge David Bunning.  Artrip admitted that, in his role as part owner of Artrip Personal Care home, he received representative payee benefits from the Social Security Administration on behalf of certain individuals living in his personal care home.  According to the plea agreement, between November 2013 and November 2017, Artrip received representative payee funds for more than twenty individuals, totaling $241,142.  Artrip admitted he spent a total of $97,806 of those representative payee funds on expenses unrelated to the use and benefit of the beneficiaries, including on his two rental properties and personal farm. 

Artrip agreed pay $97,806 in restitution to the victims.  The restitution will be divided among the victims according to the plea agreement.  Pursuant to the plea agreement, Artrip also agreed to sell the personal care home and withdraw as the representative payee for any current Social Security beneficiaries within the next sixty days.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Wayne R. Warren, Acting Special Agent in Charge, Atlanta Field Division of the Social Security Administration, Office of Inspector General, jointly made the announcement.  The investigation is part of the Department of Justice’s Elder Justice Initiative and was assisted by the Kentucky Elder Justice Task Force, which is comprised of federal, state, and local law enforcement and government agencies working together to protect the Commonwealth’s elderly population from fraud and abuse.

The investigation was directed by the SSA-OIG.  The United States was represented by Assistant U.S. Attorney Kate K. Smith.

Artrip is scheduled to be sentenced on January 24, 2020 at 9:00 a.m., in federal court in Ashland.  He faces up to five years in prison.  However, any sentence will be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the applicable federal statutes.

LEXINGTON, Ky. — Lamar Thornton, aka “Juice”, 26, of Detroit, was sentenced today, to 292 months in federal prison, by United States District Judge Karen K. Caldwell, for conspiracy to distribute heroin and carfentanyl.

In February 2019, a jury found Thornton guilty of participating in the conspiracy.  The evidence at trial established that from July 2016 to January 2017, Thornton was a source of supply of heroin and carfentanyl and the Court ultimately found that, during the conspiracy, Thornton was responsible for 1.872 kilograms of heroin and 315 grams of carfentanyl.  Thornton, who resided in Detroit, arranged for the heroin and carfentanyl to be distributed in Central Kentucky.  The scope of this drug trafficking included an overdose in Central Kentucky.  Thornton’s co-defendants, Jerrod Doolin, Jeffrey Ruggiero, Darmon Shaw, and Thomas Lehmann were previously sentenced for their participation in the conspiracy.  Thornton has a prior conviction for trafficking in heroin and had absconded from parole. 

“A critical component of our drug enforcement effort is the prosecution of out-of-state sources of supply and drug dealers who cause overdoses,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky.  “We remain committed to prosecuting these important cases.  The defendant’s distribution of heroin and carfentanyl endangered many lives and contributed to addiction in Central Kentucky, for the sake of profits.  His callous conduct certainly warrants the lengthy sentence he received.” 

Under federal law, Thornton must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for eight years.

United States Attorney Duncan and Christopher Evans, Special Agent in Charge of the DEA, jointly made the announcement.

The investigation was conducted by the DEA.  The United States was represented by Assistant United States Attorneys Cynthia T. Rieker and Todd Bradbury.

           

  LEXINGTON, Ky. – On Monday, a Lexington man was sentenced, by Senior U.S. District Judge Joseph M. Hood, for his involvement in a health care fraud conspiracy.  Samuel L. Ford, 40, was sentenced to 24 months in federal prison and 36 months of supervised release, for his role in submitting fraudulent claims for urine drug testing to insurers that administer the Kentucky Medicaid program.

Ford previously admitted to the conspiracy with Mason Routt, the owner of a toxicology laboratory in Nicholasville, Kentucky, known as C.A.L. Laboratory Services (“CAL”), and Dinesh Goyal, the owner of a separate toxicology laboratory in Owensboro, Kentucky known as Tristate Medical Laboratory (“Tristate”).  CAL provided urine drug testing services for physician clients.  Beginning in late 2015, health care organizations who administer the Kentucky Medicaid program placed payment restrictions on CAL’s claims seeking reimbursement for urine drug tests, due to concerns about the legitimacy of those claims.  Ford acknowledged that these payment restrictions dramatically reduced CAL’s revenue.

Ford admitted that in order to evade these payment restrictions, in October 2016, he, Goyal, and Routt agreed that urine drug tests referred to and performed by CAL would be billed to the health insurance programs using Tristate’s billing information, falsely representing that the tests were performed by Tristate.  In this way, CAL received reimbursements to which it was not entitled.  Ford admitted in his plea agreement that these fraudulent claims caused Humana Caresource, Aetna Coventry Cares, and Anthem Blue Cross & Blue Shield Medicaid to suffer a combined loss of $1,378,449.  As part of the sentence imposed today, Ford was ordered to repay that $1,378,449 as restitution, and will not be allowed to work in the medical billing field during his three years of supervised release.

Dinesh Goyal pled guilty to the same offense in July 2019, and is scheduled to be sentenced on October 15, 2019.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James Robert Brown, Jr., Special Agent in Charge, Federal Bureau of Investigation, Louisville Field Office; and Derrick L. Jackson, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General (HHS-OIG), Atlanta Field Office, jointly announced the sentence.

The investigation was conducted by the FBI and HHS-OIG.  The United States was represented by Assistant U.S. Attorney Paul McCaffrey. 

LONDON, Ky. – Timothy Dennis Gowder, 72, of Oak Ridge, Tennessee, and Anwar Mithavayani, 56, of Boca Raton, Florida, were sentenced to lengthy terms in federal prison by United States District Judge Robert E. Wier for conspiring to distribute oxycodone and other drugs, and for money laundering.  Gowder received a sentence of 21 years of imprisonment.  Mithavayani received a sentence of 25 years of imprisonment. 

Gowder was the medical director at the Tennessee Pain Institute (TPI), a pain clinic that operated from 2011 to 2016 near Chattanooga.  Mithavayani was a co-owner of the clinic with Pete Tyndale. After a month-long trial earlier this year, a jury convicted Gowder, Mithavayani, and Tyndale of operating TPI as a pill mill, and for money laundering related to proceeds from TPI.  The three men were responsible for the illicit distribution of more than 1.6 million oxycodone 30mg pills, and hundreds of thousands of other narcotic pills and sedative pills, such as Xanax.  Approximately half of TPI’s pill customers were traveling from eastern Kentucky.  

Under federal law, Gowder and Mithavayani each must serve 85 percent of his prison sentence. Upon release, both will be under the supervision of the United States Probation Office for three years.  The Court also imposed a fine of $250,000 and a community restitution award of $200,000 upon Gowder.  Mithavayani must pay a $500,000 fine and a $400,000 community restitution award.

Co-defendants Tyndale and James Bradley Combs will be sentenced later this month.  Co-defendant Larry Karr of Keavy, KY, pled guilty to the drug trafficking charge in May of 2018, and was later sentenced to 108 months in prison.

“The sentences imposed reflect the seriousness of the harm caused by the defendants’ unlawful and medically unnecessary distribution of controlled substances,” said United States Attorney Robert M. Duncan, Jr.  “The defendants’ callous actions undoubtedly contributed to the current opioid crisis.  We remain resolute in our commitment to hold accountable drug traffickers who profit from addiction, including those who illegally deal drugs under the guise of medical care.”    

U.S. Attorney Duncan, Special Agent in Charge D. Christopher Evans of the Drug Enforcement Administration’s Louisville Field Division, Special Agent in Charge Matthew Line of the Internal Revenue Service, Criminal Investigation Division, Andy Beshear, Kentucky Attorney General, and Richard W. Sanders, Commissioner of Kentucky State Police jointly announced the sentences.

The investigation was conducted by the DEA, the IRS, and the Kentucky Attorney’s General Office as part of an Organized Crime Drug Enforcement Task Force. The U.S. Attorney’s Office was represented in the case by Assistant U.S. Attorney Gregory Rosenberg.  

LEXINGTON, Ky. — Jerrod Doolin, 37, of Lancaster, Kentucky, was sentenced yesterday to 156 months in federal prison by United States District Judge Karen C. Caldwell for conspiracy to distribute heroin and carfentanyl and distribution of carfentanyl resulting in serious physical injury.

Beginning in July 2016 and continuing through January 19, 2017, Doolin conspired with several other people to distribute heroin and carfentanyl in Garrard, Jessamine and Fayette County.  On January 10, 2017, Doolin and Jeffrey Ruggiero, 29, of Nicholasville, another defendant distributed a quantity of carfentanyl, which resulted in an overdose. 

On April 9, 2019, Doolin pled guilty to the charge and admitted to distributing carfentanyl in an amount no less than 1100 grams of heroin in the Central Kentucky area during the five-month period of the conspiracy. Ruggiero was previously sentenced to 132 months imprisonment for his participation in the conspiracy.  

“A critical component of our drug enforcement effort is the prosecution of drug dealers who cause overdoses.  We are committed to prosecuting these important cases,” said United States Attorney Robert M. Duncan, Jr.  The defendant’s distribution of heroin and carfentanyl endangered lives and contributed to addiction in Central Kentucky.   “His actions warranted the lengthy sentence he received from the Court.”  

Under federal law, Doolin must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for five years.

United States Attorney Duncan and Christopher Evans, Special Agent in Charge of the DEA, jointly made the announcement.

The investigation was conducted by the DEA.  The United States was represented by Assistant United States Attorneys Cynthia T. Rieker and Todd Bradbury.          

LEXINGTON, Ky. – Jacquolyn Walls-Land, 36, of Junction City, Kentucky pleaded guilty yesterday, before Senior United States District Judge Joseph M. Hood, to using a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction.

According to her plea agreement, Walls-Land took videos of the minor female victim while the co-Defendant, Richard Derringer, sexually abused the victim. The sexual abuse and recording of the abuse occurred on March 11, 2018.

Walls-Land is scheduled to be sentenced on November 4, 2019.  She faces a mandatory minimum sentence of fifteen years in prison, and up to 30 years, and a maximum fine of $250,000.  However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky: James Robert Brown, Jr., Special Agent in Charge, Federal Bureau of Investigation; and Richard Sanders, Commissioner, Kentucky State Police, jointly announced the plea. 

The investigation was conducted by the Kentucky State Police and the FBI.  Assistant U.S. Attorneys David Marye and Mary Melton represented the United States. 

LEXINGTON, Ky. — Dominique Jamar McCann, 24, of Lexington, was sentenced yesterday, to 80 months in federal prison, by United States District Judge Karen C. Caldwell, for possession with intent to distribute heroin and possession of a firearm in furtherance of a drug trafficking crime. 

In May 2018, officers with the Lexington Police Department, attempted to stop the vehicle being operated by Dominique McCann.  McCann fled from the police at a high rate of speed and collided with another vehicle.  McCann then fled on foot but was quickly apprehended.  McCann was in possession of approximately one ounce of heroin and a Glock handgun.  During his plea, McCann admitted to drug trafficking and possessing the firearm in furtherance of his drug trafficking.            

Under federal law, Middlebrooks must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent in Charge of the ATF Louisville Field Division; and Lawrence Weathers, Chief of the Lexington Police Department, jointly made the announcement.

The ATF and the Lexington Police Department conducted the investigation.  The United States was represented by Assistant United States Attorney Cynthia T. Rieker.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

 

LEXINGTON, Ky. – A Federal grand jury sitting in Lexington has indicted a former employee of the Kentucky Commission (now Office) for Children With Special Health Care Needs, on charges arising from allegations of theft from that agency.  Diana Baker, 53, of Louisville, was charged with one count of mail fraud, one count of aggravated identity theft, and four counts of theft from the state agency.  

Baker was a 28-year employee of the Commission, which is an agency within the Kentucky Cabinet for Health and Family Services that assists families with children with special health care needs in obtaining funding and care.    The indictment alleges that between 2007 and 2018, Baker, who was an Administrative Branch Manager in the Louisville office, manipulated software programs, to generate fraudulent payment vouchers, which purported to reimburse the families of special needs children for out of pocket expenses or pay third party vendors for services to children.  These vouchers were sent in the regular course of business to the Kentucky State Treasurer’s Office, which issued checks that were actually used to make payments on Baker’s credit card accounts, to pay doctors and dentists for services to Baker’s family, and, in one instance, to pay a carpenter for work on a dock for lakefront property owned by Baker.    The amount of the alleged theft is approximately $45,000.   

The investigation leading to the indictment was conducted by the Kentucky Cabinet for Health and Family Services, Office of the Inspector General and the FBI.

Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

 

LEXINGTON, Ky. – Warren Griffin, II, 50, of Lancaster, Kentucky pleaded guilty today, before Chief United States District Judge Karen K. Caldwell, to joining with Clarence Michel, Jr. in a $15 million tax fraud scheme.  As part of this plea agreement, Griffin agreed to pay $2.8 million in restitution to the Internal Revenue Service.

According to his plea agreement, Griffin recruited and paid associates to open staffing companies and bank accounts, whose primary purpose was to hide from the IRS the fact that Griffin and Michel’s businesses had failed to pay $14,671,184 in federal payroll taxes. Griffin obtained $2,118,584 of that money.  During this time, Griffin also underpaid his personal federal income taxes by $700,428.

Michel had previously pleaded guilty and been sentenced to 71 months in federal prison and ordered to pay over $19 million in restitution.  Griffin is scheduled to be sentenced on September 11, 2019. He faces up to 5 years in prison and a maximum fine of $250,000 or twice the amount of the loss.  However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and William Chung, Acting Special Agent in Charge, Internal Revenue Service – Criminal Investigation, jointly announced the plea. 

The investigation was conducted by the Internal Revenue Service-Criminal Investigation.  Assistant U.S. Attorney Dmitriy Slavin represented the United States. 

LEXINGTON, Ky. - Two Eastern Kentucky counties have agreed to pay a total of $130,393 to the United States, resolving assertions that the submission of their claims to Medicare for non-emergency ambulance transports that did not meet Medicare’s reimbursement criteria.

Medicare pays for scheduled non-emergency ambulance transports only if the patient’s condition is such that taking other forms of transport would endanger the patient’s health and a physician provides a written order certifying that condition (known as “physician certification statements”).

Gallatin County Fiscal Court has agreed to pay $100,000 to the federal government to resolve claims that it routinely transported a Medicare beneficiary to and from dialysis, without medical need and without a physician certification statement, from January 1, 2013 to November 30, 2016.  In addition to the monetary payment, Gallatin County also agreed to provide to all of its ambulance employees training on Medicare’s coverage requirements, including medical necessity and physician certification requirements.

Wayne County Fiscal Court has agreed to pay $30,393 to the federal government for the transport of a Medicare beneficiary to and from dialysis, without a proper physician certification statement, from September 1, 2013 to November 30, 2013.  Wayne County self-disclosed the overpayments arising from the invalid certification statement and fully cooperated with the United States’ investigation.  As part of the settlement agreement, Wayne County has agreed to provide training to other county ambulance services on what it has learned about medical necessity and physician certification requirements.  

“When the Medicare Program pays for services that have not been properly justified, it deprives the program of precious resources to meet the needs of its beneficiaries,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “Non-emergency ambulance transports to and from dialysis can be as frequent as several times a week and represent a significant cost to the Program.  Because these services represent significant taxpayer expenses, it is critical that ambulance providers understand and comply with Medicare’s rules on medical necessity.  A physician certification statement is not merely a technical requirement, but ensures that Medicare is only reimbursing these services for patients who truly need it.  We appreciate Wayne County for self-disclosing and are glad both counties are willing to educate themselves and others on these rules.”  

The Gallatin County case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General. Assistant United States Attorneys Christine Corndorf, Jennifer Williams, and Mary Melton represented the United States in these matters.

LEXINGTON, Ky. - A Detroit man was convicted late yesterday, by a federal jury sitting in Lexington, of conspiring to distribute both oxycodone and fentanyl and distribution of fentanyl resulting in an overdose death.         

After approximately four hours of deliberations following a four-day trial, the jury convicted 43-year old Shannon D. Hixon of conspiring to distribute pills containing oxycodone and fentanyl and distribution of fentanyl resulting in the overdose death of K.F.         

According to the evidence at trial, Hixon supplied thousands of Oxycodone 30 mg tablets to two individuals in Lexington, which were then transported to Morehead (Rowan County) and Salyersville (Magoffin County), Kentucky, and sold to lower-level dealers and users.  Additionally, the testimony established that Hixon supplied heroin and fentanyl to a group of users in Lexington.  This included supplying a lethal quantity of fentanyl to a middle man, who then distributed it to K.F., an Army veteran in rehab, causing the overdose death.           

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; D. Christopher Evans, Special Agent in Charge, DEA Louisville Field Division; Chief Derrick Blevins, Morehead Police Department; and Chief Lawrence Weathers, Lexington Police Department, jointly announced the jury’s verdict.

The investigation was conducted by the DEA, Morehead Police Department, and the Lexington Police Department.  The United States was represented in the case by Assistant U.S. Attorney Roger W. West. 

Hixon is scheduled to appear for sentencing on November 8, 2019.  He faces a minimum of 20 years and a maximum of Life in prison.  However, the Court must consider the  U.S. Sentencing Guidelines and the applicable federal statutes before imposing a sentence.

 

    FRANKFORT, Ky. – Yesterday, Kari Dawn Yount, 32, of Shelbyville, Kentucky, was sentenced to 21 years in federal prison, by U.S. District Judge Gregory F. Van Tatenhove, for distributing heroin that caused an overdose death.  An individual identified in court documents as C.N.M., 22, fatally overdosed on a mixture of heroin and acrylfentanyl, on March 1, 2017, in Franklin County.  The investigation by the Frankfort Police Department identified Yount as the person responsible for selling the drug mixture to C.N.M.  Yount pleaded guilty to the offense on March 25, 2019.

Under federal law, Yount must serve 85 percent of her sentence.  Upon her release from prison, she will also be under the supervision of the U.S. Probation office, for a period of five years.

“When people distribute these dangerous drugs, they are placing many lives and their own freedom in jeopardy,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky.  “To be clear,  we are committed to combatting illegal opioid distribution  with all the tools available to us.  The potential for significant sentences, such as this one, loom for those convicted of selling this poison and causing needless deaths.  We are thankful for the great work of our law enforcement partners, as we all work toward reducing the impact of the opioid scourge in our communities.” 

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; D. Christopher Evans, Special Agent in Charge, DEA Louisville; and Charles Adams, Chief of Police, Frankfort Police Department, jointly made the announcement. The United States was represented by Assistant United States Attorney Todd Bradbury.      

COVINGTON, Ky. - The Wildwood Inn Tropical Dome and Theme Suites in Florence, Kentucky (“Wildwood Inn”) entered into an agreement with the United States to resolve a recent complaint alleging violations of the Americans with Disabilities Act (“ADA”) relating to the use of service animals.  The ADA generally requires that places of public accommodation permit the use of a service animal by an individual with a disability.  The law also prohibits inquiries into the details of a person’s disability in connection with their use of a service animal and forbids demands for documentation relating to certification, training, or licensure of the service animal.

The complainant, a veteran of the Iraq War and recipient of the Bronze Star with Valor, suffers from post-traumatic stress disorder and uses a service animal to assist with her disability.  The complainant alleged that Wildwood Inn’s staff requested to see either the certification paperwork for her service animal or medical paperwork from a doctor when she attempted to check into the hotel.  The complainant and her husband advised the staff members that the ADA does not allow such requests, but Wildwood Inn’s staff ultimately refused to provide the complainant with lodging at the hotel.

As part of the settlement, Wildwood Inn has agreed to adopt a Service Animal Policy, train its staff members on the ADA’s requirements for service animals, and post signage permitting service animals.

“Service animals offer invaluable support to individuals with a wide range of disabilities, including veterans suffering from post-traumatic stress disorder and traumatic brain injury,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky.  “The ADA ensures that people who depend on service animals have the same opportunities for goods and services as the public at large.  This settlement furthers that purpose by improving awareness of the ADA’s requirements for service animals, particularly in those situations where a person does not have an obvious physical impairment.  We appreciate Wildwood Inn’s cooperation throughout the investigation and willingness to reach a prompt resolution that benefits individuals with disabilities.  We look forward to working together with them to implement the settlement agreement.”   

People interested in finding out more about the ADA can call the Justice Department’s toll-free Information Line at 800-514-0383 (TDD), or access the ADA homepage at www.ada.gov.

 

LEXINGTON, Ky. - A Paris, Kentucky man admitted in federal court today that he conspired to commit crop insurance fraud.         

Keith A. Foley, 49, pleaded guilty today to conspiring to violate the laws of the United States before U.S. District Court Senior Judge Joseph M. Hood.           

Foley, an agricultural producer of tobacco in Bourbon and Jessamine Counties, admitted that from approximately 2011 through 2016, he agreed with others to commit crop insurance fraud.  In these years, Foley took out Multi-Peril Crop Insurance to cover his tobacco crops, an insurance program funded by the federal government through the Federal Crop Insurance Corporation but administered through private insurance providers.  Foley admitted that he hid his crop production from the insurance companies, in order to claim that his crop suffered enough damage to trigger federal crop insurance indemnity payments.

Foley also had private insurance policies (called crop-hail policies) covering his tobacco crop.  In crop years 2012, 2014, and 2015, Foley admitted to entering into an agreement with his crop adjusters and insurance agent at the time, in order to defraud his insurance companies.  To accomplish this, Foley’s coconspirators submitted fabricated documents, to support tobacco crop damage, to Foley’s insurance companies.  In exchange, Foley paid his coconspirators a portion of the resulting indemnity payout. 

According to the plea agreement, Foley’s conduct caused a loss of approximately $480,000 to the federal government and private insurance companies.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Bethanne M. Dinkins, Special Agent in Charge, United States Department of Agriculture Office of Inspector General; James Robert Brown, Jr, Special Agent in Charge, Federal Bureau of Investigation; Christopher Altemus, Special Agent in Charge, Internal Revenue Service-Criminal Investigation; and Willie Skeens, Director, Kentucky Department of Insurance Fraud Investigation Division, jointly announced the guilty plea.

The investigation was conducted by the United States Department of Agriculture Office of Inspector General, United States Department of Agriculture Risk Management Agency, Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation, and Kentucky Department of Insurance.  The United States was represented by Assistant U.S. Attorneys Erin M. Roth and Kathryn A. Anderson. 

Foley is scheduled to be sentenced on October 21, 2019.  He faces up to 5 years in prison and a maximum fine of $250,000 or twice the amount of loss.  However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the federal statutes.

 

 

The Defendant qualified as an Armed Career Criminal

 

LEXINGTON, Ky. — Gregory Thomopolous, 39, of Lexington, was sentenced today to 262 months in federal prison, by United States District Judge Joseph M. Hood, for possession with intent to distribute 50 grams or more of methamphetamine, possession with intent to distribute fentanyl, possession of a firearm in furtherance of drug trafficking, and possession of a firearm by a convicted felon. 

In May 2018, officers with the Lexington Police Department, arrested Thomopolous for an outstanding warrant.  During a search of his vehicle officers located approximately 75 grams of methamphetamine, a quantity of fentanyl, and a .357 revolver.  Thomopolous admitted to distributing methamphetamine and fentanyl.  Thomopolous also admitted that he possessed the firearm for protection during drug deals.  At the time of his arrest, Thomopolous was on parole for other charges.  Thomopolous has seven prior felony convictions, including drug trafficking.  Based on his criminal history, Thomopolous was found to be an Armed Career Criminal.            

Under federal law, Thompolous must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for 5 years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent in Charge of the ATF Louisville Field Division; and Lawrence Weathers, Chief of the Lexington Police Department, jointly made the announcement.

The ATF and the Lexington Police Department conducted the investigation.  The United States was represented by Assistant United States Attorney Cynthia T. Rieker.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

  LEXINGTON, Ky. – On Friday, July 19, 2019, a Chinese national residing in Chino Hills, California, was sentenced by U.S. District Judge Danny C. Reeves for his involvement in a money laundering conspiracy operating in Fayette County and elsewhere.  Fengqiang Zhang, 41, was sentenced to 48 months in federal prison and 36 months of supervised release for his role in laundering money that was proceeds of drug trafficking. Zhang also faces deportation to China as a result of his conviction.

Zhang previously admitted that, from October 2018 until December 2018, in Fayette County, he conspired with Nancy Garcia Zapata and others to launder drug proceeds.  Garcia also pleaded guilty to the same money laundering conspiracy charge and was sentenced to 71 months and 36 months of supervised release.

The investigation, jointly conducted by the Drug Enforcement Administration and the Lexington Police Department, began in 2016.  The early investigation focused on the drug trafficking activities of Garcia’s husband, Fernando Lara Salas, and resulted in the execution of a search warrant in July 2017 at the residence he shared with Garcia.  Officers located and seized 6 kilograms of cocaine, more than 50 grams of methamphetamine, approximately $110,000 in U.S. currency, and a loaded firearm.  Following a jury trial, Fernando Lara Salas was convicted of drug trafficking, firearms and immigration offenses and was sentenced to a term of 353 months.

By October 2018, only 3 months after Lara Salas was sentenced, investigators were focused on Nancy Garcia and the same Lexington residence.  DEA agents seized nearly $400,000 in drug proceeds from Zhang and later observed Zhang meeting with Garcia at the residence.  Zhang was stopped by police, who located approximately $150,000 in a duffle bag in his rental vehicle, which was proceeds Zhang received from Garcia.  A search warrant was executed at the residence and approximately $272,000 in drug proceeds were seized.  Both Zhang and Garcia admitted that all of the money seized from them by law enforcement during the investigation was proceeds of drug trafficking.

“We will continue to emphasize the importance of anti-money laundering efforts, especially related to drug trafficking investigations,” said United States Attorney Robert M. Duncan, Jr.  “By disrupting the ability of a criminal organization to launder and move proceeds of illegal drug trafficking activities, law enforcement personnel are able to weaken that organization. In disrupting the flow of money, law enforcement also disrupts the flow of drugs. We commend the work of our law enforcement partners with DEA and the Lexington Police Department on this successful investigation and prosecution.”

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Darrell Christopher Evans, Special Agent in Charge, DEA Louisville, and Lawrence Weathers, Chief of Police, Lexington-Fayette County Division of Police, jointly made the announcement. The United States was represented by Assistant United States Attorney Todd Bradbury.       

 

LEXINGTON, Ky. — D’Vonta Middlebrooks, 24, of Lexington, was sentenced today, to 115 months in federal prison, by United States District Judge Danny C. Reeves, for possession of a firearm by a convicted felon. 

In August 2018, officers with the Lexington Police Department, while assisting State Probation and Parole officers, located Middlebrooks in a Lexington residence.  During the search of the residence, officers located a 9 mm handgun.  Middlebrooks admitted to the possession of the firearm and was arrested.  At the time of his arrest, Middlebrooks was on bond for other charges.           

 Under federal law, Middlebrooks must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for three years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent in Charge of the ATF Louisville Field Division; and Lawrence Weathers, Chief of the Lexington Police Department, jointly made the announcement.

The ATF and the Lexington Police Department conducted the investigation.  The United States was represented by Assistant United States Attorney Cynthia T. Rieker.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

One overdose death is too many in Kentucky

 

LOUISVILLE, Ky. – United States Attorneys Russell Coleman and Robert M. Duncan, Jr. applauded the work today of federal, state, and local law enforcement and health professionals as the overdose death rate in Kentucky took a significant dip with 233 fewer drug fatalities in 2018 than there were in 2017. While the decrease marks an improvement 1,333 Kentuckians lost to dangerous drugs are far too many in any state.

Federal prosecutors will continue to work hand-in-hand with state and local law enforcement agencies to have a significant impact in the fight against heroin and meth in Kentucky. Federal prosecutors sitting in the Eastern and Western Districts are actively prosecuting overdose cases where as little as one pill has caused death or serious bodily injury. U.S. Attorney’s Coleman and Duncan acknowledge treatment and prevention efforts are key in solving the crisis, however, enforcement will also remain a vital deterrent.

“Today’s announcement of a 15% decrease in the number overdose deaths in the Commonwealth is certainly positive news and a step in the right direction,” said United States Attorney Robert M. Duncan, Jr.  “However, we all recognize there is still work to be done. We remain committed to using all available tools to combat this crisis, including vigorously prosecuting unlawful opioid traffickers, partnering to conduct community outreach and education, and encouraging those needing help to seek treatment.”   

“We’re not there yet,” said U.S. Attorney Russell Coleman. “But lives saved last year demonstrates that unity of effort amongst federal, state, and local law enforcement is gaining ground in this fight.”

The Eastern and Western District United States Attorney’s Offices are actively pursuing the cartels that supply the majority of illegal synthetic opioids, like Fentanyl, to the Commonwealth. In addition both offices have Heroin Education Action Teams (USA HEAT) that are aimed at reducing the harm to Kentucky families and communities caused by heroin/opiate abuse by increasing community understanding of this epidemic. USA HEAT is a partnership between the United States Attorney’s Office for the Eastern and Western District of Kentucky and families who have lost a loved one to opiate overdose. These courageous moms, dads, brothers, sisters and children share their story in order to help others avoid the grief of losing a family member to a drug overdose. The Eastern District of Kentucky also utilizes Operation Synthetic Opioid Surge (SOS) in Fayette County dedicated to reducing access to illicit fentanyl.

The Appalachian Regional Prescription Opioid Strike Force (ARPO Strike Force), a joint law enforcement is also bringing dividends on the enforcement front. ARPO brings together the resources and expertise of the Health Care Fraud Unit in the Criminal Division’s Fraud Section (HCF Unit), the U.S. Attorney’s Offices for nine federal districts in five states, as well as law enforcement partners at the Federal Bureau of Investigation (FBI), U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG) and U.S. Drug Enforcement Administration (DEA).  The mission of the ARPO Strike Force is to identify and investigate health care fraud schemes in the Appalachian region and surrounding areas, and to effectively and efficiently prosecute medical professionals and others involved in the illegal prescription and distribution of opioids.

Both districts also utilize Appalachia HIDTA task forces, with the mission to enhance and coordinate drug enforcement efforts of local, state and federal law enforcement agencies within areas designated as High Intensity Drug Trafficking Areas by pursuing the disruption/dismantlement of Drug Trafficking Organizations, particularly as it relates to the specific drug threat of the Appalachian region.

 

LEXINGTON, Ky. – Today, a Federal Grand Jury, sitting in Lexington, returned an indictment against Marcellis Means, 23, of Lexington, charging him with one count of being a convicted felon in possession of a firearm.

The indictment alleges that on or about July 10, 2019, Means, a convicted felon, committed the offense when he was found unlawfully in possession of a firearm in Lexington.  The investigation into this firearm-related offense was conducted by agents with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), in conjunction with the Lexington Police Department and the Kentucky State Police.

Means is scheduled to appear in federal court for a detention hearing on July 19, 2019.  Means faces a maximum sentence of 10 years and a $250,000 fine. However, any sentence following a conviction would be imposed by the Court after its consideration of the United States Sentencing Guidelines and applicable federal statutes.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, Stuart L. Lowery, Special Agent in Charge, ATF, Louisville Field Division, Richard Sanders, Commissioner, Kentucky State Police, and Lawrence Weathers, Chief of Police for the Lexington Police Department, jointly made the announcement.

Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

 

COVINGTON, Ky. — Kevin A. Howard, 35, of Cincinnati, was sentenced on Thursday, to 188 months in federal prison, by United States District Judge Danny C. Reeves, for distribution of 50 grams or more of crystal methamphetamine. 

Howard previously admitted pursuant to a guilty plea that, on January 16, 2019 and January 22, 2019, he distributed 50 grams or more of crystal methamphetamine to an individual in Covington, for $1,400.  Unbeknownst to Howard, this individual was working as undercover law enforcement with the Northern Kentucky Drug Strike Force.  After the two undercover purchases, law enforcement obtained a search warrant for Howard’s residence in Cincinnati, where an additional 444 grams of crystal methamphetamine was seized, along with two firearms.    

Under federal law, Howard must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for a term of five years. 

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration , Christopher P. Conners, Director, Northern Kentucky Drug Strike Force, jointly made the announcement.

The investigation was conducted by the Drug Enforcement Administration and the Northern Kentucky Drug Strike Force.  The United States was represented by Assistant United States Attorney Wade T. Napier.

LEXINGTON, Ky. — Mark Adkins, 46, of Powell County, Kentucky was sentenced yesterday, by U.S. District Judge Danny C. Reeves, to 224 months in federal prison, for distributing methamphetamine.

Beginning in October 2017 and continuing through January 2018, law enforcement made eight purchases of methamphetamine from Mark Adkins, at his residence in Powell County.  In total, officers seized approximately 671 grams of methamphetamine.  Adkins has two prior drug trafficking convictions—one in Morgan Circuit Court and a second in U.S. District Court for the Eastern District of Kentucky.

Adkins will be required to serve at least 85% of the sentence imposed.  Upon his release, he will be under supervision by the United States Probation Office for a period of five years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; D. Christopher Evans, Special Agent in Charge, DEA Lexington; and Commissioner Richard Sanders, Kentucky State Police, jointly announced the sentence. The investigation was conducted by personnel from KSP, the Appalachia High Intensity Drug Trafficking Area (AHIDTA) Drug Task Force, and DEA.  Assistant United States Attorney Lauren Bradley prosecuted the case on behalf of the United States.

LEXINGTON – One year ago, the Justice Department announced the formation of Operation Synthetic Opioid Surge (S.O.S.), a program designed to reduce the supply of deadly synthetic opioids in high impact areas as well as identifying wholesale distribution networks and international and domestic suppliers. 

Over the past year, 10 districts with some of the highest drug overdose death rates in the country, each targeted a county where they focused on prosecuting every readily available case involving fentanyl, fentanyl analogues, and other synthetic opioids, regardless of the drug quantity. These districts worked with DEA Special Operations Division to track and coordinate these street-level cases and also received additional assistance from the Organized Crime and Drug Enforcement Task Forces (OCDETF).

“Our attorneys and law enforcement agents have spent the past year working tirelessly to disrupt the networks engaged in the trafficking of synthetic opioids. Today we are proud to share their successes in 10 of the districts most affected by this scourge,” Deputy Attorney General Jeffrey A. Rosen said. “The Department of Justice’s efforts have resulted in countless successes from California to Maine. We have successfully sought enhanced sentences in cases that resulted in deadly overdoses, and we have boosted cooperation among the partners involved. There remains much work to be done, but Operation S.O.S. marks a crucial turning point in the fight against synthetic opioids.”

“The success of the S.O.S. initiative is based on strong partnerships,” stated United States Attorney Robert M. Duncan, Jr.  “We are fortunate to work with the Commonwealth Attorney’s Office, the Lexington Police Department, and DEA in implementing and advancing this important program.”   

Fayette County was chosen as the S.O.S. location in the Eastern District of Kentucky.  In November 2018, a specially-funded Assistant United States Attorney was hired to prosecute S.O.S. and related cases.  Since then, 15 cases, involving 19 defendants, have been prosecuted in federal court as part of the S.O.S. initiative. 

The following prosecutions are currently pending trial:

U.S. v. Walter Powell and Elisha Wilson (19-CR-69-S-JMH): Powell and Wilson are charged with conspiring to distribute 40 grams or more of fentanyl, possession with intent to distribute 40 grams or more of fentanyl, conspiring to distribute crack cocaine, and possession with intent to distribute crack cocaine.  Trial is scheduled for September 16, 2019, in Lexington. 

U.S. v. Allen Norman (19-CR-93-DCR): Norman is charged with being a felon in possession of a firearm.  Trial is scheduled for August 29, 2019, in Lexington.

U.S. v. Xavier Leburton Gray (19-CR-94-DCR): Gray is charged with possession with intent to distribute fentanyl and being a felon in possession of two firearms.  Trial is scheduled for August 19, 2019, in Lexington.

U.S. v. Maurice Love, Edith Tripure, and Richard Lomax Carter (19-CR-95-DCR): Love, Tripure, and Carter are charged with conspiring to distribute 40 grams or more of fentanyl.  Love and Tripure are also charged with distribution of fentanyl and possession with intent to distribute fentanyl. Trial is scheduled for August 19, 2019, in Lexington. 

U.S. v. Julio Cesar Cordero-Barrios (19-CR-110-JMH): Cordero-Barrios is charged with conspiring to distribute fentanyl, distribution of fentanyl, possession with intent to distribute fentanyl, and armed drug trafficking. Trial is scheduled September 10, 2019, in Lexington.

U.S. v. Raymond Duong (19-CR-116-KKC): Duong is charged with possession with intent to distribute 40 grams or more of fentanyl and possession with intent to distribute methamphetamine. Duong is also charged with being a felon in possession of 8 firearms.  A trial date to be determined. 

Overall, ten S.O.S. defendants have pleaded guilty in federal court to charges of distributing synthetic opioids or related charges and are pending sentencing, including defendants in the following cases: 

U.S. v. Michael Glover (19-CR-05-KKC): On June 6, 2019, Glover pleaded guilty to possession with intent to distribute 10 grams or more of valerylfentanyl.  In his plea agreement, Glover acknowledged that he was arrested by the Lexington Police Department and ultimately found to be in possession of 58 grams of valerylfentanyl. Glover admitted that he possessed the drugs with intent to distribute.  Based upon a statutory mandatory minimum, Glover faces a sentence of not less than 5 years and not more than 40 years.  Glover’s sentencing is scheduled September 12, 2019, at 10:30 a.m., in Lexington. 

U.S. v. Eldronte Washington (19-CR-26-JMH): On May 20, 2019, Washington pleaded guilty to possession with intent to distribute 40 grams or more of fentanyl. In his plea agreement, Washington admitted that Lexington Police officers searched his residence, discovering Washington in possession of more than 40 grams of fentanyl, three firearms, and $4,240. Washington admitted that he intended to distribute the fentanyl.  Based upon a statutory mandatory minimum, Washington faces a sentence of not less than 5 years and not more than 40 years.   Washington’s sentencing is scheduled for September 9, 2019, at 11:30 a.m., in Lexington.

U.S. v. Jameel Sleet (19-CR-35-S-DCR): On April 24, 2019, Sleet pleaded guilty to possession with intent to distribute 40 grams or more of fentanyl.  In his plea agreement, Sleet admitted to being a passenger in a vehicle stopped by Lexington Police officers.  An officer searched Sleet and found 40 grams of fentanyl, 39 grams of cocaine, and 16 grams of crack cocaine.  Sleet admitted he intended to distribute the drugs.  Based upon a statutory mandatory minimum, Sleet faces a sentence of not less than 5 years and not more than 40 years. Sleet’s sentencing is scheduled for August 16, 2019, at 9:30 a.m., in Lexington.

U.S. v. Aaron Antonio Evans (19-CR-46-S-KKC): On June 25, 2019, Evans pleaded guilty to possessing with intent to distribute 10 grams or more of acetylfentanyl.  In his plea agreement, Evans admitted that he sold approximately 11 grams of acetylfentanyl.  Based upon a statutory mandatory minimum, Evans faces a sentence of not less than 5 years and not more than 40 years. Evans’s sentencing is scheduled for October 4, 2019, at 10:00 a.m., in Lexington.

U.S. v. Khalid Yusef White (19-CR-48-JMH): On April 29, 2019, White pleaded guilty to possessing with intent to distribute 10 grams or more of a substance containing acetylfentanyl and valerylfentanyl.  Based upon a statutory mandatory minimum, White faces a sentence of not less than 5 years and not more than 40 years. White’s sentencing is scheduled for August 12, 2019, at 11:30 a.m., in Lexington.

U.S. v. Chris David Lewis, Jr. (19-CR-52-KKC): On May 15, 2019, pleaded guilty to possession with intent to distribute 40 grams or more of fentanyl.  In his plea agreement, Lewis admitted that Lexington Police officers detained him and discovered he had 58 grams of fentanyl and 13 grams of methamphetamine in his coat pocket.  Lewis admitted that he planned to distribute the fentanyl.  Based upon a statutory mandatory minimum, Lewis faces a sentence of not less than 5 years and not more than 40 years.  Lewis’s sentencing is scheduled for September 12, 2019, at 11:00 a.m., in Lexington.

U.S. v Anthony McIntosh (19-CR-53-JMH): On May 28, 2019, McIntosh pleaded guilty to possession with intent to distribute fentanyl.  In his plea agreement, McIntosh admitted that he was encountered by Lexington Police officers, who discovered 21 grams of fentanyl.  McIntosh admitted he intended to sell the fentanyl found in his possession.  McIntosh’s sentencing is scheduled for September 16, 2019, at 10:00 a.m., in Lexington.

U.S. v. Lavonte Lee Harmon (19-CR-70-DCR): On June 7, 2019, Harmon pleaded guilty to possession with intent to distribute 10 grams or more of acetylfentanyl.  In his plea agreement, Harmon admitted that Lexington Police officers searched his residence and person, discovering 13 grams of acetylfentanyl, 17 grams of cocaine, and $4,474.  At Harmon’s residence, officers found an additional 13 grams of cocaine and other evidence of drug trafficking. Based upon a statutory mandatory minimum, Harmon faces a sentence of not less than 5 years and not more than 40 years.   Harmon’s sentencing is scheduled for October 4, 2019, at 9:30 a.m., in Lexington. 

Two S.O.S. defendants have been sentenced to federal prison.  On May 28, 2019, Edward Malik Cotton (19-CR-04-JMH) was sentenced to 100 months in prison for possessing with intent to distribute 40 grams or more of acetylfentanyl.  Cotton admitted he possessed 87 grams of acetylfentanyl and a firearm. 

On May 14, 2019, Steven Ray Slone (19-CR-06-JMH) was sentenced to 24 months in prison for possessing fentanyl with the intent to distribute.  Slone admitted to possessing 7 grams of fentanyl with the intent to sell it. 

Both Cotton and Slone must serve 85 % of their sentences; and upon their release from prison, they will be subject to periods of supervision by the United States Probation Office.

“We are pleased with the results of the S.O.S. initiative thus far,” stated U.S. Attorney Duncan.  “Because of the hard work of law enforcement, we have held several synthetic opioid traffickers accountable for their actions; we have removed dangerous drugs from the community; and we have helped save lives. Despite this success, we recognize that there is still work to be done and we remain committed to partnering in support of the S.O.S. initiative.”    

 

 LEXINGTON, Ky. – A Madison County woman has agreed to resolve civil allegations that she violated the False Claims Act, a federal law that prohibits the submission of false or fraudulent claims, agreeing to pay the federal government, after admitting that she falsified timesheets that caused her to wrongfully receive federal funds from the AmeriCorps Program.

The Madison County woman was a member of AmeriCorps, a national service initiative administered by the Corporation for National and Community Service (CNCS).  AmeriCorps is a federally funded network of national service programs that address critical community needs like increasing academic achievement, mentoring youth, fighting poverty, sustaining national parks, preparing for disasters, and more.  Frequently, federal AmeriCorps grants are provided to state service commissions, tribes, and local, regional, and national organizations to execute these service initiatives.  Members of AmeriCorps commit to service for a period of three months to a year in exchange for a living allowance, educational benefits, and other perks.

The PartnerCorps Science, Technology, Engineering and Mathematics (“PartnerCorps STEM”) AmeriCorps program, operated by Berea College, is a recipient of AmeriCorps grants. PartnerCorps STEM increases student competency in STEM fields through the mentorship and tutoring of high school students in Madison County, Kentucky. The AmeriCorps members who provide these services receive a monthly living allowance for the service performed.

During the 2017-2018 school year, the AmeriCorps member in question committed to service with PartnerCorps STEM. In exchange for her tutoring and mentoring activities at Madison Southern High School (“MSHS”), the member received a monthly living allowance. From January to March 2018, however, the member did not report to her service site or perform any AmeriCorps service; nevertheless, she submitted six timesheets falsely representing that she had performed her duties at MSHS during the relevant time period. Relying on the false timesheets, PartnerCorps STEM provided the member with a CNCS-funded living allowance in January 2018 and February 2018.  Further, when PartnerCorps STEM realized that the AmeriCorps member had stopped reporting to serve and withheld her living allowance for March 2018, the AmeriCorps member escalated her fraud scheme by inquiring as to the status of her missed payment, knowing that her timesheets were false and that she had performed no service during that time frame. 

 “When false claims are submitted to national service programs, it depletes their limited resources and undermines their valuable work, which is designed to benefit and improve our communities,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “In this case, each false timesheet resulted in more than simply the loss of money; it caused a loss of valuable high school tutoring, increased college opportunities within a community, and the promotion of critical academic fields that support and benefit our entire community.  We recognize these cases have both monetary and non-monetary impacts and we remain committed to serving as stewards for the integrity of these important programs.”

“AmeriCorps’ purpose is to engage young adults in serving their communities, not stealing from them,” said Inspector General Deborah J. Jeffrey.  “We applaud our DOJ partners for recognizing that timesheet fraud is serious and that it has an even greater impact when it involves national service.  The loss in these cases is measured not only by the theft of taxpayer funds, but in the loss of critical assistance to our at-risk communities.  We will continue to vigorously pursue timesheet fraud against CNCS programs and its beneficiaries.”

The Corporation for National and Community Service, Office of Inspector General, performed the investigation, and Assistant United States Attorney Mary Melton handled the matter for the United States.

LEXINGTON, Ky. – Today, an Owensboro man admitted in federal court that he participated in a conspiracy to defraud health insurance programs of more than $1.3 million.  

Dinesh Goyal, 60, pleaded guilty to one count of conspiracy to commit an offense against the United States, before United States District Judge Joseph Hood.  Goyal owned a toxicology laboratory in Owensboro, Kentucky called Tristate Medical Laboratory (“Tristate”).  His co-conspirators, Mason Routt and Sam Ford, owned or were affiliated with a Nicholasville, Kentucky toxicology lab known as C.A.L. Laboratory Services (“CAL”).  Among other things, CAL provided urine drug testing services for physician clients.  Beginning in late 2015, health care organizations who administer the Kentucky Medicaid program placed payment restrictions on CAL’s claims seeking reimbursement for urine drug tests, due to concerns about the legitimacy of those claims.  In October 2016, Goyal, Routt, and Ford agreed that urine drug tests referred to and performed by CAL would be billed to the health insurance programs using Tristate’s billing information, falsely representing that the tests were performed by Tristate.  In this way, CAL evaded the payment restrictions placed upon it by the insurers, and received reimbursements to which it was not entitled.  In exchange for the use of his lab’s billing information, Goyal agreed to receive 40% of these fraudulent reimbursements.  In the plea agreement filed today, Goyal admitted that these fraudulent claims caused Humana Caresource, Aetna Coventry Cares, and Anthem Blue Cross & Blue Shield Medicaid to suffer a combined loss of $1,378,449.

Goyal was charged by way of information in the Eastern District of Kentucky, waiving his right to indictment by a federal grand jury.  Sam Ford, one of his co-conspirators, pled guilty to the same offense in March 2019 and is scheduled to be sentenced on August 12, 2019.  Mason Routt, the owner of CAL and the other co-conspirator, passed away unexpectedly in August 2017.

In addition to his guilty plea, Goyal entered into a separate settlement agreement resolving his civil liability under the federal False Claims Act for the same misconduct.  Pursuant to the False Claims Act settlement agreement, Goyal is obligated to sell personal and commercial property and remit 75% of the net sale proceeds to the United States, in addition to certain cash payment obligations.  Goyal also agreed to be excluded from the Medicare and Kentucky Medicaid programs for a period of 10 years, meaning that he cannot own or work for any company that submits claims to those federal health insurance program.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James Robert Brown, Jr., Special Agent in Charge, Federal Bureau of Investigation, Louisville Field Office; and Derrick L. Jackson, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General (HHS-OIG), Atlanta Field Office, jointly announced the guilty plea.

The investigation was conducted by the FBI and HHS-OIG.  The U.S. Attorney’s Office for the Eastern District of Kentucky was represented by Assistant U.S. Attorney Paul McCaffrey in the criminal case, and by Assistant U.S. Attorney Christine Corndorf in the parallel civil case. 

Goyal is scheduled to be sentenced on October 15, 2019, in federal court in Lexington.  He faces up to 5 years in prison and a maximum fine of $250,000, or twice the amount of loss caused by his crime, whichever is greater.  However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the applicable federal statutes.  

LEXINGTON, Ky. – Rural Metro of Southern Ohio, Inc. (“Rural Metro”) has agreed to resolve civil allegations that it violated the False Claims Act, a federal law that prohibits the submission of false or fraudulent claims to the federal government, agreeing to pay $275,116.22. 

The United States alleged that Rural Metro violated the False Claims Act by submitting, or causing the submission of, false claims to Medicare, for overnight hospital discharge ambulance transports that were not medically necessary, between January 1, 2013 and September 1, 2017.  To be medically necessary, ambulance transportation requires that a patient’s medical condition prohibit other methods of transportation, but Rural Metro submitted claims for patients who could have been appropriately transported by other means. 

“Those who participate in Medicare must play by the rules,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky. “Paying for unnecessary services deprives the Medicare Program of invaluable resources and weakens its ability to actually provide appropriate services to its beneficiaries. Our Office is committed to taking the steps necessary to protect Medicare from fraud and abuse and to recovering taxpayer money that was obtained inappropriately.” 

“When companies try to boost their profits by billing federal health care programs for medically unnecessary services, the Office of Inspector General will ensure they are held accountable for their actions,” said Special Agent in Charge Derrick L. Jackson, HHS-OIG.

Nicholas Ratterman, a former Rural Metro employee, originally filed this lawsuit under the qui tam, or whistleblower, provisions of the False Claims Act, which permits private individuals with knowledge of fraud to sue on behalf of the government for false claims and to share in any recovery.  Mr. Ratterman will received approximately $44,000 from the settlement with Rural Metro. 

The government’s action in this matter illustrates its commitment to combat health care fraud using the False Claims Act.  Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).

The case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General.  Assistant United States Attorneys Jennifer Williams and Mary Melton handled the matter for the United States.

The case is captioned United States ex rel. Ratterman v. Mercury Ambulance Services, Inc., et al., Case No. 17-cv-148-JMH.  The claims resolved by the settlement are allegations only, and there has been no determination of liability.

PIKEVILLE, Ky. — On Monday, James William Miller was sentenced to 180 months in federal prison, by United States District Judge Robert E. Wier, for possession with intent to distribute methamphetamine, possession of a firearm in furtherance of drug trafficking, and felon in possession of a firearm.  

The investigation revealed that Miller was trafficking in methamphetamine for approximately two years in and around Floyd County.  A search of Miller’s residence in August of 2018, revealed eight firearms, including a semi-automatic AR-15, digital scales, distribution baggies, and a distribution quantity of methamphetamine.  Miller had a prior conviction for Trafficking in a Controlled Substance, from December of 2014 in Floyd County Circuit Court.  As a result of that conviction Miller was prohibited from possessing firearms. 

Under federal law, Miller must serve 85 percent of his prison sentences.  Upon his release, he will be under the supervision of the United States Probation Office for an additional four years.  

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James Robert Brown, Jr., Federal Bureau of Investigation Special Agent in Charge for the Louisville Field Division; Richard Sanders, Kentucky State Police Commissioner and John Hunt, Floyd County Sheriff, jointly made the announcement.  The United States was represented by Assistant United States Attorney Jenna E. Reed.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

PIKEVILLE, Ky. — Three members of a Pike County family have been sentence to federal prison for their involvement in a conspiracy to distribute cocaine in Pike County.  On Monday, United States District Judge Robert E. Wier sentenced Roy Blankenship to 85 months in prison.  Today, Blankenship’s wife, Shirley Blankenship, and his brother, Larry Blankenship, were sentenced to 34 and 33 months, respectively. 

Each of the Blankenships pled guilty to the cocaine trafficking charges in March of 2019.  The FBI’s investigation revealed that between 2010 and 2018, the Blankenships regularly obtained cocaine from out of state and sold it in the Stopover community of Pike County.  This conviction marks the fourth federal felony conviction for Roy Blankenship, including a prior felony conviction related to cocaine trafficking.  

Under federal law, the Blankenships must serve 85 percent of their prison sentences. Upon their release, the Blankenships will be under the supervision of the United States Probation Office.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James Robert Brown, Jr., Federal Bureau of Investigation Special Agent in Charge for the Louisville Field Division; Richard Sanders, Kentucky State Police Commissioner; and Christopher Edmonds, Chief of the Pikeville Police Department jointly made the announcement.  The United States was represented by Assistant United States Attorney Andrew H. Trimble.

FRANKFORT, Ky. - A Texas man was convicted in federal court, on July 3, 2019, following a three day jury trial, for crossing a state line to engage in sexual acts with minors who had not attained the age of 12.  Gregory Lee Hruby, of Brazoria, Texas, faces a mandatory minimum sentence of 360 months (30 years) on each of two counts of traveling across a state line to engage in a sexual act with a person under the age of 12.  He also faces a potential twenty-year sentence for possession of visual depictions of minors engaging in sexually explicit conduct.         

According to trial testimony, Hruby communicated with an undercover law enforcement agent, who responded to a post that Hruby had placed on the Whisper Application.  In the communications, the undercover officer portrayed herself as the mother of 9 and 11 year-old daughters, who she was willing to permit Hruby to “teach how to be a woman.”  Hruby engaged in text and telephone conversations with the undercover officer in which he indicated his interest in engaging in sexual intercourse with the fictitious minors.  Hruby was arrested after law enforcement officers met him at the airport in Lexington, on October 19, 2018, following his arrival on a flight from Houston, Texas.  Hruby also had child pornography images on his cell phone. 

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Steve Igyarto, Special Agent in Charge, Department of Homeland Security – Homeland Security Investigations (DHS-HSI); and Kentucky Attorney General Andy Beshear jointly announced the verdict.

The investigation was conducted by DHS-HSI and the Cyber Crimes Branch of the Office of the Attorney General of Kentucky.  Assistant U.S. Attorneys David A. Marye and Tashena A. Fannin represented the federal government in the case.

COVINGTON, Ky. – Today, an Ohio man admitted in federal court that he collectively defrauded a Kentucky bank and seventeen individuals and businesses in Kentucky, Ohio, West Virginia, and Wisconsin of more than $4.6 million.   

Anthony McQuaid, 47, pleaded guilty to one count of bank fraud and one count of wire fraud before United States District Judge David Bunning.  McQuaid admitted he executed a scheme to defraud Town Square Bank, of Ashland, Kentucky, to obtain a loan for $1 million, in 2014.  McQuaid also admitted he developed and executed a scheme to defraud Auto Now Acceptance Co., LLC, of Portsmouth, Ohio, of $850,200, in 2017.  According to the plea agreement, between November 2014 and June 2018, McQuaid defrauded 17 other individuals in Ohio, Kentucky, West Virginia, and Wisconsin, through various fraud schemes.  In total, McQuaid admitted his schemes caused a loss of at least $4,698,055.

McQuaid was charged by way of information in the Eastern District of Kentucky and the Southern District of Ohio, waiving his right to indictment by a federal grand jury. 

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Benjamin C. Glassman, United States Attorney for the Southern District of Ohio; Joseph E. Moriarty, Special Agent in Charge, Federal Deposit Insurance Corporation, Office of Investigations, Chicago Region; James Robert Brown, Jr., Special Agent in Charge, Federal Bureau of Investigation, Louisville Field Office; and Todd A. Wickerham, Special Agent in Charge, Federal Bureau of Investigation, Cincinnati Division, jointly announced the guilty plea.

The investigation was conducted by the FDIC and the FBI.  The U.S. Attorney’s Office for the Eastern District of Kentucky was represented by Assistant U.S. Attorney Kate K. Smith.  The U.S. Attorney’s Office for the Southern District of Ohio was represented by Special Assistant U.S. Attorney Timothy Landry.

McQuaid is scheduled to be sentenced for 10:00 am on November 12, 2019, in federal court in Ashland, Kentucky.  He faces up to 30 years in prison and a maximum fine of $1,000,000.  However, any sentence will be imposed by the Court after consideration of the U.S. Sentencing Guidelines and the applicable federal statutes.  

LEXINGTON, Ky. – A Georgetown man, Bobby Cassady, 32, has been sentenced to 15 years in federal prison, to be followed by a life term of supervised release for inducing minors to produce sexually explicit images.  Cassady was also ordered to make a restitution payment in the amount of $ 15,000.00 and pay a mandatory special assessment of $5,100.00.

On Monday, United States Senior District Judge Joseph M. Hood formally sentenced Cassady, who pleaded guilty to a single count of production of sexually explicit images in interstate commerce, on February 4, 2019.  Cassady must serve 85 percent of his prison sentence.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Steven Igyarto, Special Agent in Charge, Department of Homeland Security – Homeland Security Investigations (DHS-HSI); Tony Gray, Chief of Police of the Danville, Kentucky Police Department; and Andy Beshear, Kentucky Attorney General, jointly announced the sentence.

The investigation was conducted by the Cyber Crimes Branch of the Office of Attorney General of Kentucky, the Danville Police Department and DHS-HSI.  The United States was represented by Assistant United States Attorney David Marye.

LEXINGTON, Ky. — A federal jury has found Mikhy Farrera-Brochez, a 34 year old man originally from Winchester, Kentucky, guilty of two counts of sending threatening communications to the Government of Singapore and its Ministry of Health. The jury also found Farrera-Brochez guilty of one count of possessing and transferring the means of identity of other people in interstate and foreign commerce with the intent to commit, or in connection with, another crime. The jury convicted Farrera-Brochez on Tuesday, June 4, 2019, following a 2-day trial in U.S. District Court.

According to trial testimony, Farrera-Brochez obtained access to a database belonging to the Singaporean Ministry of Health that listed the private identifying and medical information of thousands of people in Singapore living with HIV, including more than 50 U.S. citizens. He sent the database to his mother in Kentucky, and retrieved it when he returned to Kentucky in 2018. On January 22, 2019, Farrera-Brochez sent an email to several officials of the Government of Singapore that included three links to places on the internet where he had put copies of the database. He made several demands in that email. On February 18, 2019, he sent a second email to officials of the Government of Singapore threatening to publish the database if his demands were not met.

Farrera-Brochez is scheduled to be sentenced on September 27, 2019, at the federal courthouse in Lexington. He faces a possible sentence of up to 2 years of imprisonment on each count of sending threatening communications, and of up to 5 years for possessing and transferring the identity information. The Court will impose a sentence after consideration of the U.S. Sentencing Guidelines and the applicable federal statutes.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and James Robert Brown, Jr., Special Agent in Charge of the FBI, jointly made the announcement.

The investigation was conducted by the Federal Bureau of Investigation. The United States was represented by Assistant United States Attorney Dmitriy Slavin and Special Assistant United States Attorney James Chapman.

LEXINGTON, Ky. – John Jerome O’Hara, of Lexington, Paul Anthony Long, II, of Lexington, and Mitzi Shawn Sears, of Nancy, Kentucky all appeared in federal court today on charges related to elder financial exploitation.

O’Hara and Long both previously pleaded guilty to fraud charges related to the theft of funds from relatives.  According to his plea agreement, O’Hara used his Power of Attorney over his mother’s finances to obtain money for his personal benefit, while at the same time failing to pay his mother’s living expenses at her nursing home.  Court documents indicate that while O’Hara’s mother suffered from dementia, he took over $330,000 from her accounts for his personal benefit.  Judge Danny C. Reeves sentenced O’Hara to 26 months in prison and was ordered to pay $332,149.95 in restitution.  Upon release from prison, O’Hara will be on supervised release for five years.

According to Long’s plea agreement, he too abused his Power of Attorney, over his grandfather’s finances, to spend his grandfather’s money for his own benefit.  Court documents indicate that Long’s grandfather suffered from severe Alzheimer’s Disease and was a resident of Thomson Hood Veterans Center in Wilmore, Kentucky.  From 2011 until his grandfather’s death in 2015, Long took over $600,000 from his grandfather.  Neither his grandfather nor the Power of Attorney authorized any of those expenditures.  Judge Danny C. Reeves sentenced Long to 42 months in prison and Long was ordered to pay $608,395 in restitution.  Upon release from prison, Long will be on supervised release for five years.

In London, Kentucky, Mitzi Shawn Sears pleaded guilty to financial institution fraud.  According to her plea agreement, Sears convinced a victim identified as “M.N.” to buy property in Pulaski County with her, as an investment, and then to pay legal fees associated with a fictitious lawsuit concerning that real property.  She impersonated real people, in emails and phone calls to M.N., in efforts to convince M.N. that the expenses associated with the property and the lawsuit were legitimate.  Sears also admitted to forging 16 checks belonging to M.N., and cashing them or negotiating them for her own benefit.  In total, Sears obtained $455,977.00 from various bank accounts belonging to M.N., for her personal benefit.  Further, Sears admitted she lured M.N. into applying for a $40,000 business loan to cover expenses for the property, in order to obtain even more money.

Sears faces up to 30 years in prison, a fine of $1,000,000, and five years of supervised release for her offense.  She has agreed to forfeit the property she purchased with the money taken from M.N.  She is scheduled to be sentenced by Judge Robert E. Wier on September 9, 2019.

All three cases highlight efforts by the Department of Justice and federal and state investigative agencies to combat elder financial exploitation. “The Department, and our Office, work in partnership with other law enforcement agencies to hold accountable those individuals that victimize elderly citizens,” said United States Attorney Robert M. Duncan, Jr.  “These prosecutions underscore our commitment to seeking justice on behalf of this vulnerable population.”    

An example of cooperation among law enforcement agencies is is the Kentucky Elder Justice Task Force, which brings together the resources of federal, state, and local agencies involved in protecting the elderly.  For more information on the Kentucky Elder Justice Task Force, including how to report abuses, please visit: https://www.justice.gov/usao-edky/elder-justice-task-force.”

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, announced the sentences and the conviction.  Resident Agent in Charge, Jon Oldham, United States Secret Service, and Chief of Police Lawrence Weathers, Lexington Police Department, join in the announcement of the sentence of O’Hara.  Special Agent in Charge James Robert Brown, Federal Bureau of Investigation, joins in the announcement of the sentence of Long.  FBI Special Agent in Charge Brown and Commissioner Richard W. Sanders, Kentucky State Police, join in the announcement of the conviction of Sears.

LEXINGTON, Ky. — Jeffery Ruggiero, 29, of Nicholasville, Kentucky, was sentenced today, to 132 months in federal prison, by United States District Judge Karen C. Caldwell, for conspiracy to distribute heroin and carfentanyl and distribution of carfentanyl resulting in serious physical injury.

Beginning in July 2016 and continuing through January 19, 2017, Ruggiero conspired with several other people to distribute heroin and carfentanyl in Garrard, Jessamine and Fayette County.  On January 10, 2017, Ruggiero and another defendant distributed a quantity of carfentanyl, which resulted in an overdose.  On September 5, 2018, Ruggiero pled guilty to the charge and admitted to distributing at least 120 grams of heroin in the Central Kentucky area during the five-month period of the conspiracy.             

“The defendant put lives at risk by distributing deadly drugs, including carfentanyl,” said United States Attorney Robert M. Duncan, Jr.  “The defendant’s actions warranted the lengthy sentence he received today from the Court.”  

Under federal law, Ruggierio must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for five years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, and Christopher Evans, Special Agent in Charge of the DEA, jointly made the announcement.

The investigation was conducted by the DEA.  The United States was represented by Assistant United States Attorneys Cynthia T. Rieker and Todd Bradbury.

 

LEXINGTON, Ky. – Phillip Maurice Collins, 42, of Lexington, was sentenced to 78 months in federal prison today, by United States District Judge Danny C. Reeves, for possession with the intent to distribute fentanyl and cocaine, as well as possession of a firearm by a convicted felon.

On August 22, 2018, officers and detectives with the Lexington Police Department executed a search warrant on Collins’s home in Lexington. During the search, officers located quantities of fentanyl and cocaine possessed by Collins, with the intent to distribute it to other individuals.  In addition to the narcotics, officers also located a loaded firearm in Collins’s bedroom.  Collins had multiple prior felony convictions and was prohibited from possessing a firearm under state and federal law.  Collins subsequently plead guilty to all charges, on January 30, 2019.

Under federal law, Collins must serve 85 percent of his sentence. Upon completion of his imprisonment, he will be under the supervision of the United States Probation Office for a period of six years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; D. Christopher Evans, Special Agent in Charge, DEA, Louisville Division; and Lawrence Weathers, Chief of Police, Lexington Police Department, jointly made the announcement.

LEXINGTON, Ky. — Michael Steven Lyvers, 41, of Bardstown, Kentucky, was  sentenced today, to 135 months in federal prison, by United States District Judge Karen K. Caldwell, for possession with intent to distribute Methamphetamine and possession of a firearm in furtherance of drug trafficking. 

In March 2018, detectives with the Lexington Police Department received information that Michael Lyvers was distributing methamphetamine from the Days Inn.  During the investigation, officers located 491 grams of methamphetamine, a small amount of heroin and cocaine, and a .380 handgun.  During his guilty plea, Lyvers admitted to the distribution of methamphetamine and to possessing the firearm for protection during his drug trafficking.          

Under federal law, Stackhouse must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for five years.

Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowrey, Special Agent in Charge of the ATF; and Lawrence Weathers, Chief of the Lexington Police Department jointly made the announcement.

The ATF and the Lexington Police Department conducted the investigation.  The United States was represented by Assistant United States Attorney Cynthia T. Rieker.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

 

LONDON, Ky. — Robert “Bobby” Hurley, III, 25, of London, was sentenced today, to 162 months in federal prison, by United States District Judge Claria Horn Boom, for kidnapping and the use of a firearm in furtherance of a crime of violence.

Hurley pled guilty to these charges in April of 2018.  According to the plea agreement, the victim in the case was accused of stealing money from a local drug dealer that Hurley frequented.  Hurley decided to locate and kidnap the victim, as a means of currying favor with the drug dealer.  Hurley located the victim in the East Bernstadt area of Laurel County, approached the victim, and struck the victim in the back of the head with a shotgun.  Hurley then ordered the victim to get into a waiting vehicle, at gunpoint.  Hurley then directed the driver – an acquaintance of Hurley’s – to drive the three to the drug dealer’s residence, in Pulaski County.

Once there, Hurley and a codefendant, directed the victim to exit the vehicle and go in the back door.  Hurley walked behind the victim with the shotgun. Once inside, Hurley and the codefendant bound the victim’s hands and feet and put duct tape over his mouth.  The two men then placed the victim in a chair and began questioning him over the alleged theft of money.  A third accomplice assisted in the questioning.  While this was occurring, Hurley struck the victim in the head with the shotgun several times.  Hurley and his two codefendants took turns interrogating and assaulting the victim. The victim was ultimately released after falsely confessing to the theft.

“The defendant’s possession of a firearm in furtherance of brutal acts of violence, including kidnapping and assault, warranted the significant sentence imposed by the Court,” said United States Attorney Robert M. Duncan, Jr.  “I commend the efforts of law enforcement in the investigation of this case, leading to a successful prosecution that removed a violent offender from the community.”  

“This violent defendant threatened the safety of our Eastern Kentucky communities,” stated ATF Special Agent in Charge Stuart Lowrey of the Louisville Field Division. “ATF is committed to working with our law enforcement partners by providing investigative resources that lead to arrests and successful prosecutions of dangerous criminal offenders.”         

Under federal law, Hurley must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for five years.

U.S. Attorney Duncan; Special Agent in Charge Lowrey; and Richard Sanders, Commissioner of the Kentucky State Police, jointly made the announcement.

The investigation was conducted by the ATF and Kentucky State Police.  The United States was represented by Assistant United States Attorney W. Samuel Dotson.

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

LEXINGTON, Ky. – Jeremy D. Stidham, Dario Adrian Mauriz-Cruz, Wayne Russell Fugate, and Larry Joe Burton have all entered guilty pleas to federal charges related to stolen firearms.  Stidham and Mauriz-Cruz pleaded guilty to stealing firearms and selling them.  Fugate pleaded guilty to buying stolen firearms and illegally possessing more than 25 firearms, as a convicted felon.  Burton pleaded guilty to possessing two stolen firearms, including a M-16 semi-automatic rifle stolen from law enforement. 

In September and October 2017, several locations in Kentucky, Ohio, and Tennessee experienced a number of vehicle break-ins, where firearms, credit cards and other items were stolen.  A multi-jurisdictional task force investigation identified Stidham and Mauriz-Cruzas the primary suspects.  The investigation also established that more than 50 firearms had been stolen, along with other personal property.  These firearms were sold to at least two others, including Fugate and Burton. 

In executing a search warrant at Fugate’s residence, law enforcement located 22 stolen firearms and more than 2,000 rounds of ammunition.  Subsequent investigation recovered six additional firearms purchased by Fugate.  Law enforcement also searched Burton’s residence and, through further investigation, recovered the M-16 semi-automatic rifle that had been stolen from law enforcement.         

Stidham, 25, pleaded guilty to aiding and abetting the possession of stolen firearms.  Mauriz-Cruz, 27, pleaded guilty to aiding and abetting the possession of stolen firearms and to being a felon in possession of firearms.  Fugate, 49, pleaded guilty to being a felon in possession of more than 25 stolen firearms and Burton, 59, pleaded guilty to possession of stolen firearms. 

 Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowery, Special Agent in Charge, ATF; Richard Sanders, Commissioner, KSP; Chief Lawrence Weathers, Lexington Police Department; Michael Helmig, Boone County Sheriff; Matt Sparks, Rowan County Sheriff; Ernie Kelty, Mercer County Sheriff; and Mike Coyle, Madison County Sheriff jointly announce the guilty pleas.  The United States was represented by Assistant U.S. Attorney Roger W. West. 

Stidham, Cruz, and Burton are scheduled to be sentenced on August 26, 2019; Fugate is scheduled to be sentenced on September 3, 2019.  Each faces up to ten years in prison and a fine of $250,000.  However, any sentence will be imposed by the Court, after consideration of the U.S. Sentencing Guidelines and the federal statutes.