District of Minnesota

United States Attorney Andrew M. Luger today announced the sentencing of CHARLES JAMES JONES, 50, to 27 years in prison. JONES was convicted by a jury on March 10, 2015, after a seven-day trial, of burning his girlfriend alive while she was unconscious. JONES was sentenced today in U.S. District Court in St. Paul by U.S. District Judge Susan Richard Nelson.

As proven at trial, in December 2013, JONES and his girlfriend, Shalonda Clark, were huddled in the living room of their home in Ponsford, Minn., trying to stay warm from the heat of the oven. Clark became unconscious and laid immobile on a couch in the living room. At that time, JONES took a blanket, lit it on fire, and threw it on top of Shalonda Clark’s defenseless body.

As proven at trial, Shalonda Clark never regained consciousness to escape the blaze. JONES however, fled the burning house to another house across the road. Though his neighbors, who could clearly see the burning house across the road, asked JONES where Shalonda Clark was, he told them that he did not know. Nonetheless, the neighbors went to the defendant’s home to look for Shalonda Clark. JONES did not help them, nor did he tell them where in the house she could be found. Clark’s charred remains were later recovered from among the ashes of the couch.

This case was the result of an investigation conducted by the Becker County Sheriff’s Office, the Minnesota Bureau of Criminal Apprehension, the FBI and the White Earth Police Department.

This case was prosecuted by Assistant U.S. Attorneys Kevin S. Ueland and Julie E. Allyn of the Major Crimes Section of the U.S. Attorney’s Office.

 

Defendant Information:

CHARLES JAMES JONES, 50

Ponsford, Minn.

Convicted:

• Murder in the Second Degree, 1 count

Sentenced:

• 27 years in prison

• Five years supervised release

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the sentencing of ROBERT JAMES SCHUELLER, 30, to five years in prison. SCHUELLER was charged by Information and pleaded guilty on May 26, 2015, to devising a plot to harm his former paramour’s fiancé. He was sentenced today by U.S. District Judge Richard H. Kyle in United States District Court in St. Paul, Minn.

According to the defendant’s guilty plea and documents filed in court, SCHUELLER, then vice-president of Nomad Pipeline (Nomad) and married to then president M.S., had an extra-marital affair with an employee of Nomad’s sister company. Approximately three months after R.T. ended the relationship with SCHUELLER, SCHUELLER learned that R.T. was in a relationship with C.A. Therefore, SCHUELLER began attempting to win back R.T.’s affections. When the defendant was unable to win back R.T., he began pursuing various schemes to get C.A. out of the picture and away from R.T.

According to the defendant’s guilty plea and documents filed in court, on February 6, 2014, SCHUELLER called W.E., another Nomad employee, and asked if W.E. stayed in contact with any of his prison contacts because SCHUELLER had a guy that needed to “go away.” Over the course of several months, SCHUELLER and W.E. communicated back and forth concerning the defendant’s desire to find someone willing to harm C.A. Once W.E. provided SCHUELLER a specific name as a possible person who could injure C.A., SCHUELLER sent W.E. a package containing $10,000 in cash and a business card, on which C.A.’s name was written. On May 2, 2014, W.E. informed SCHUELLER that he was unable to find someone to carry out the plot to injure C.A. and then returned the $10,000 to SCHUELLER. After this conversation, SCHUELLER texted W.E. and instructed him to burn the business card.

According to the defendant’s guilty plea and documents filed in court, SCHUELLER admitted to attempting to contact several other Nomad employees seeking their assistance in causing bodily injury to C.A. SCHUELLER further admitted to plotting various seduction schemes in an attempt to break-up C.A. and R.T. For example, in January 2014, SCHUELLER paid his sister-in-law $500 to seduce C.A.; and in May 2014, SCHUELLER posted a Craigslist ad titled “Girls – 1 time $5,000 cash offer” that sought a “pretty girl” to “break up a couple by any means necessary” and offered payment for such services.

This case was the result of an investigation conducted by the Federal Bureau of Investigation and the Stearns County Sheriff’s Office.

This case was prosecuted by Assistant United States Attorneys Julie E. Allyn and Steven L. Schleicher of the Special Prosecutions Section of the U.S. Attorney’s Office.

 

Defendant Information:                                                                                                                     

ROBERT JAMES SCHUELLER, 30

Farming Township, Minn.

Convicted:

• Threats Transmitted by Interstate Communication, 1 count

Sentenced:

• Five years in prison

   

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  United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger, FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton, Minnesota Bureau of Criminal Apprehension (BCA) Superintendent Drew Evans and Stearns County Sheriff John Sanner today announced a federal criminal complaint charging DANIEL JAMES HEINRICH, 52, with receipt and possession of child pornography. HEINRICH made an initial appearance today in U.S. District Court in St. Paul, Minn., before Magistrate Judge Jeffrey J. Keyes. A detention hearing is expected to be held on Monday, November 2, 2015.

According to the federal criminal complaint and documents filed in state court, a search warrant was executed on July 28, 2015, at the Annandale, Minn., home of the defendant, seeking evidence related to the January 13, 1989, kidnapping and sexual assault of a Cold Spring, Minn., juvenile male and the October 22, 1989, abduction of a St. Joseph Township, Minn., juvenile male. During the execution of the search warrant, officers recovered numerous images of suspected child pornography from the residence. Those images were maintained in multiple three-ring binders and on the hard drive of a desktop computer.

“The charges against Mr. Heinrich result from a long-term child exploitation investigation,” said U.S. Attorney Luger. “Every image of child pornography victimizes a young person. Their lives and those of their families are never the same. This investigation wasn’t initiated to pursue those who trade in child pornography, but that’s what it uncovered and that’s what we’ve charged. The Stearns County Sheriff, Minnesota Bureau of Criminal Apprehension and the FBI continue the relentless pursuit of justice through this ongoing investigation for those who have lost loved ones.”

“This arrest sends a clear message to those who would exploit children: Law enforcement is actively pursuing you,” said Special Agent in Charge Thornton. “Children are the most innocent among us and there is no greater cause than their safety and protection. The FBI, in conjunction with our law enforcement partners, will continue to aggressively seek those who would victimize children.”

“An investigation of this length and nature requires an unwavering commitment dedicated to ensure that in the end justice is served,” said Stearns County Sheriff John L. Sanner. “The Stearns County Sheriff’s Office is grateful for and appreciates this level of commitment from our partners, the BCA, the FBI and the community as a whole.”

“Our pursuit of predators who target our children will never stop,” said BCA Superintendent Drew Evans. “It doesn’t matter how long ago it happened. In fact, as the science and the tools we use improve year after year, so does our ability to solve these crimes.”

According to the criminal complaint, among the suspected child pornography images stored in three-ring binders in HEINRICH’s home were more than 100 images that appear to depict child pornography, some of which depict known child victims, based on a review of national database of known victims of sexual abuse. In addition to the printed images, digital images of suspected child pornography were recovered from the defendant’s computer hard drive. Investigators also recovered hours of videos, apparently surreptitiously recorded by HEINRICH, of neighborhood children delivering newspapers, riding bicycles, playing in public playgrounds and participating in sporting activities.

In addition to the suspected child pornography discovered in HEINRICH’s home, and according to the criminal complaint, a recently-tested article of clothing worn by the juvenile male during a 1989 Cold Spring abduction and sexual assault was found to contain the defendant’s DNA. According to the BCA laboratory report, the predominant male DNA profile matches a known sample of the defendant. The predominant profile match to the defendant’s DNA would not be expected to occur more than once among unrelated individuals in the world population.

If you have information about this case, please contact the Stearns County Sheriff’s Office at 1-320-656-6625 or the National Center for Missing and Exploited Children at 1-800-THE-LOST.

This case is the result of an investigation conducted by the FBI, Minnesota Bureau of Criminal Apprehension and the Stearns County Sheriff’s Office.

This case is being prosecuted by Assistant United States Attorneys Steven L. Schleicher and Julie Allyn of the U.S. Attorney’s Office’s Special Prosecutions Unit.

 

Defendant Information:

DANIEL JAMES HEINRICH, 52

Annandale, Minn.

Charges:

• Possession of child pornography, 4 counts
• Receipt of child pornography, 1 count

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

The charges contained in the criminal complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.

 

United States Attorney Andrew M. Luger today announced the sentencing of JAMES SIGANOS, 50, to 21 months in prison. SIGANOS was charged on May 26, 2015, by felony information, of evading corporate income taxes. He pleaded guilty on June 11, 2015, before U.S. District Judge Ann D. Montgomery in U.S. District Court in Minneapolis, Minn. In addition to the 21 month prison sentence, SIGANOS was also ordered to pay $300,619 in restitution.

“This defendant took affirmative steps to hide his business income from the government,” said Assistant United States Attorney Joseph H. Thompson. “But the Criminal Investigation Division of the IRS noticed and stopped Mr. Siganos from continuing to engage in his willful criminal conduct.”

According to his guilty plea and documents filed in court, SIGANOS was the owner of a carpet-cleaning business located in Mound, Minnesota. As owner of the company, the defendant was responsible for filing federal corporate tax returns on behalf of the company. SIGANOS filed a Form 1120S U.S. Income Tax Return for the calendar year 2009, in which he underreported his company’s gross receipts or sales as $246,166.

In 2009, SIGANOS’ company had approximately $591,013 in gross receipts or sales. To avoid paying taxes on the full amount of his company’s revenue, SIGANOS cashed more than 1,400 checks totaling approximately $410,905 at a check cashing facility in Minneapolis. The result was that the defendant underreported his 2009 income by approximately $344,858. SIGANOS filed no corporate income tax returns for the tax years 2010, 2011, and 2012, resulting in an underreporting of approximately $438,991. The total tax loss caused by SIGANOS is approximately $300,000.

This case was the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.

This was prosecuted by Assistant U.S. Attorney Joseph H. Thompson.

Defendant Information:

JAMES SIGANOS, 50
Mound, Minn.

Convicted: • Tax Evasion, 1 count

Sentenced: • 21 months in prison
• $300,619 in restitution

United States Attorney Andrew M. Luger today announced the conviction of VELTREZ BLACK, a/k/a “Chief,” for participating in two street gangs operating throughout Hennepin County. The defendant was a prominent member of the 1-9 gang, which worked together with the Stick up Boys gang to illegally obtain and jointly possess firearms. BLACK was convicted yesterday after a jury trial in federal court of conspiracy and felon in possession of a firearm. A sentencing date has not been set. The other ten co-conspirators indicted in this case have all pleaded guilty.

As proven at trial and according to the defendants’ guilty pleas, the defendants coordinated their illegal activities in order to obtain firearms by theft, trading drugs for guns, and by using straw purchasers without felony histories to buy guns for those members of the gang with felony records. On five separate occasions between August 2010 and November 2014, BLACK was in possession of a total of 12 separate guns while a convicted felon and while in the company of other 1-9 gang members who also were convicted felons. The 1-9 and Stick Up Boys were in a gang war with two other rival gangs. The gang war resulted in the shooting deaths and wounding of numerous gang members on both sides of the conflict. At least fifteen alleged gang members were killed or wounded by gunfire during the gang conflict.

Due to the conflict, members of 1-9 and Stick Up Boys conspired with straw purchasers to illegally acquire and jointly possess firearms. The straw purchasers, DEONTAY JONES and LAKESHA COLEMAN, purchased at least ten guns in their own names and provided at least some of those firearms to members of the 1-9 and Stick Up Boys. JONES filed false police reports explaining that these guns were stolen from his home, when in fact, at least two of the guns were provided to 1-9 gang members.

This case is the result of an investigation conducted by the Hennepin County Violent Offender Task Force (VOTF), the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Minneapolis Police Department. The investigation began as part of an ongoing effort to reduce gang activity connected with numerous incidents of violent crime in Hennepin County. VOTF investigators on this case include personnel from the Hennepin County Sheriff’s Office, Brooklyn Park Police Department, Brooklyn Center Police Department, Golden Valley Police Department, and Richfield Police Department. 

This case is being prosecuted by Assistant U.S. Attorney Jeffrey Paulsen.

Defendant Information:

VELTREZ BLACK, a/k/a “Chief”

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count
• Felon in Possession of a Firearm, 1 count

TYWIN BENDER, a/k/a “Finn Winn”

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count

NITELEN JACKSON, a/k/a “King Nite”

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count

DONTEVIUS CATCHINGS, a/k/a “Lil Snake”

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count

CINQUE OWENS

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count

JABARI JOHNSON

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count
• Felon in Possession of a Firearm, 1 count

DARRYL PARKER, a/k/a “Thirsty”

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count
• Felon in Possession of a Firearm, 1 count

MARQUIS WOODS, a/k/a “Quis Moe”

Convicted: • Felon in Possession of a Firearm, 1 count

MARQUES ARMSTRONG, a/k/a “Lil Kease”

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count

DEONTAY JONES

Convicted: • Unlawful controlled substances user in possession of firearms, 1 count

LAKESHA COLEMAN

Convicted: • Conspiracy – Felon in Possession of Firearms, 1 count

United States Attorney Andrew M. Luger and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division today announced the conviction of REX LEE FURMAN, 52, of Federal Dam, Minnesota, to all counts of the indictment against him. The jury found FURMAN guilty of producing, receiving, distributing and possessing child pornography, as well as committing a felony offense while being required to register as a sex offender. After a three-day trial before Senior U.S. District Judge David S. Doty, the jury returned the guilty verdict in less than two hours. A sentencing date has not been set, however due to his prior convictions, FURMAN is subject to a mandatory life sentence.

As proven at trial, in August 2013 a special agent with the Minnesota Bureau of Criminal Apprehension (BCA) began an internet investigation using peer-to-peer (P2P) software. An officer with the Minneapolis Police Department began a separate and independent investigation in October 2013. During these investigations, both law enforcement officers obtained child pornography videos from the same internet protocol (IP) address linked to the defendant’s home.

As proven at trial, on February 13, 2014, BCA executed a search warrant at FURMAN’s residence in Federal Dam with the assistance of the Cass County Sherriff’s Office. FURMAN acknowledged at that time that he looked for and downloaded child pornography. FURMAN also informed a Special Agent that he had produced images depicting the genitalia of two girls who were in his care at the time. A full forensic analysis of FURMAN’s computers and digital media revealed two sets of child pornography that he produced in August and September of 2012 that included graphic photos and a video of the girls’ genitalia. At the time of the production, one girl turned four-years-old and the other was five-years-old. Investigators also found hundreds of images and videos of child pornography depicting prepubescent children engaged in sex acts with adults.

The defendant has two prior state court convictions for engaging in sex acts with minors. In December 1981, Furman pled guilty to fourth degree criminal sexual conduct in Wright County, Minnesota, for sexually abusing a five-year-old girl who was in his care. On January 13, 1999, the defendant was convicted of first degree criminal sexual conduct in Hennepin County, Minnesota, for sexually abusing a ten-year-old girl in his care. As a result of the second conviction, the defendant was required to register as a sex offender until 2021.

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

This case is the result of an investigation conducted by the Minnesota Bureau of Criminal Apprehension, which leads the Minnesota Internet Crimes Against Children Task Force, the Minneapolis Police Department, which is a member of the FBI Child Exploitation Task Force and the Cass County Sheriff’s Office.

This case is being prosecuted by Assistant U.S. Attorney Melinda A. Williams of the District of Minnesota and Assistant Deputy Chief Alexandra R. Gelber from the Criminal Division’s Child Exploitation and Obscenity Section.

Defendant Information:

REX LEE FURMAN, 52
Federal Dam, Minn.

Convicted: • Production of child pornography, 13 counts
• Distribution of child pornography, 2 counts
• Receipt of child pornography, 1 count
• Possession of child pornography, 1 count
• Commission of a felony offense involving a minor when required to register as a sex offender, 1 count

A Minnesota man with two prior convictions for sexually abusing children was convicted today of child pornography charges.  Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Andrew M. Luger of the District of Minnesota made the announcement.

Rex Lee Furman, 52, of Federal Dam, Minnesota, was found guilty following a three-day trial of producing, receiving, distributing and possessing child pornography, and committing a felony offense while being required to register as a sex offender.  Senior U.S. District Judge David S. Doty of the District of Minnesota presided over the trial.  Sentencing will be set at a later date.  Due to his prior convictions, Furman is subject to a mandatory life sentence plus 10 years in prison.

According to the evidence presented at trial, in the fall and winter of 2013, during separate investigations by the Minnesota Bureau of Criminal Apprehension (BCA) and the Minneapolis Police Department, law enforcement officers obtained child pornography videos from an Internet protocol (IP) address linked to Furman’s home.  The evidence showed that, thereafter, on Feb.13, 2014, during a search of his residence, which was executed with the assistance of the Cass County Sheriff’s Office, Furman acknowledged that he had downloaded child pornography.  According to the trial evidence, he also informed a special agent that he had produced images depicting the genitalia of two girls who had been in his care, one who turned four years old and one who was five years old at the time.  The trial evidence showed that subsequent forensic analysis of Furman’s computers and digital media revealed child pornography that he produced in August and September of 2012 that included sexually explicit photos and a video.  According to the trial evidence, investigators also found hundreds of images and videos depicting children engaged in sex acts with adults.

Furman has two prior Minnesota state court convictions for engaging in sex acts with minors.  In December 1981, Furman pleaded guilty to sexually abusing a five-year-old girl who was in his care.  In January 1999, Furman was convicted after a bench trial of sexually abusing a 10-year-old girl in his care.  As a result, he was required to register as a sex offender until 2021.

This case was investigated by the Minnesota BCA, which leads the Minnesota Internet Crimes Against Children (ICAC) Task Force, and the Minneapolis Police Department, which is a member of the FBI Child Exploitation Task Force.  The case is being prosecuted by Assistant U.S. Attorney Melinda A. Williams of the District of Minnesota and Assistant Deputy Chief Alexandra R. Gelber of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS).

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

United States Attorney for the District of Minnesota Andrew M. Luger and FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton today announced a second superseding indictment charging five Minnesotans with conspiracy to murder overseas, perjury and other charges. The indictment, which was originally filed on February 19, 2015, and superseded on May 18, 2015, is the result of a long-term investigation led by the Minneapolis Division of the FBI into a group of individuals who have tried to join – and in some cases succeeded in joining – the Islamic State of Iraq and the Levant.

At least nine Minnesotans have now been charged as part of this conspiracy. Three of the men charged have pleaded guilty, including ABDULLAHI YUSUF (February 16, 2015), HANAD MUSSE (September 9, 2015), and ZACHARIA ABDURAHMAN (September 17, 2015). The remaining defendants, HAMZA AHMED, ADNAN FARAH, GULED OMAR, ABDURAHMAN DAUD and MOHAMED FARAH, are scheduled to go to trial on February 16, 2016, before Senior U.S. District Judge Michael Davis.

This second superseding indictment charges OMAR, AHMED, DAUD, A. FARAH, and M. FARAH with conspiracy to murder overseas. A. FARAH is additionally charged with two counts of perjury for false testimony provided to the grand jury. M. FARAH and DAUD are each charged with one count of perjury for false testimony given before the grand jury. OMAR is charged with attempted financial aid fraud for trying to use $5,000 of financial aid to fund his travel to Turkey. 

Beyond these additional charges, the charges in the original indictment and the first superseding indictment are re-alleged. The new counts against the defendants are listed below.

This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.

 

Defendant Information:                                                                                                                     

HAMZA AHMED, 20
Savage, Minn.

Charges: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
• False statement, 1 count
• Financial aid fraud, 1 count

MOHAMED FARAH, 21
Minneapolis, Minn.

Charges: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
• Perjury, 1 count
• False statement, 1 count

GULED OMAR, 21
Minneapolis, Minn.

Charges: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 2 counts
• Attempted financial aid fraud, 1 count

ABDIRAHMAN DAUD, 21
Minneapolis, Minn.

Charges: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Attempting to Provide Material Support to a Designated Foreign Terrorist Organization, 1 count
• Perjury, 1 count

ADNAN FARAH, 19
Minneapolis, Minn.

Charges: • Conspiracy to Murder Outside the United States, 1 count
• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count
• Perjury, 2 counts

United States Attorney Andrew M. Luger today announced a federal indictment charging three members of the Minneapolis-based Taliban gang and the Young N’ Thuggin’ (YNT) gang. All three defendants were charged with conspiracy to possess firearms and ammunition, ROBERT WINFIELD ANDERSON, a/k/a “Rob Moe,” 26, and ROBERT LEVELLE FRELIX, a/k/a “Lil Rob,” 24, were charged with possession of firearms and ammunition by a felon, and SHANE JAMAL JACKSON, a/k/a “Sunny,” 23, was charged with possession of firearms by a felon. All three defendants made their initial appearances yesterday before U.S. Magistrate Judge Steven E. Rau. Detention hearings are set for Monday morning.

According to the indictment and documents filed in court, from at least June 2011 through at least June 2015, the defendants participated in the activities of two closely associated street gangs, the Taliban and the YNT (“Taliban/YNT”). The Taliban/YNT are organized for the purpose of making money for the gang members by trafficking in illegal drugs, armed robberies and thefts. In addition to making money through criminal activity, the purpose of the Taliban/YNT is to obtain and use firearms. All three defendants have prior felony offenses that make them ineligible to possess firearms.

According to the indictment and documents filed in court, an ongoing gang war between the Taliban/YNT and their rivals, the 1-9 Dipset and Stick Up Boys gangs, has resulted in the shooting deaths of numerous gang members on both sides of the conflict. Due to the ongoing gang war, and the need for weapons to conduct other illegal activity, the three defendants and other members of the Taliban/YNT conspired to illegally obtain and jointly possess firearms. As an example, on September 21, 2014, FRELIX, JACKSON and another gang member engaged in a gun battle with rival gang members near 24th Street and Aldrich Avenue in North Minneapolis. Following the shootout, law enforcement recovered one Glock .40 caliber pistol and two Glock 9mm pistols from the scene.

This indictment is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Minneapolis Police Department, Hennepin County Sheriff’s Office and the Safe Streets Task Force.

This case is being prosecuted by Assistant U.S. Attorney David P. Steinkamp.

 

Defendant Information:

ROBERT WINFIELD ANDERSON, a/k/a “Rob Moe,” 26

Minneapolis, MN

Charges:

• Conspiracy – Felon in Possession of Firearms and Ammunition, 1 count
• Felon in Possession of a Firearm, 3 counts
• Felon in Possession of Ammunition, 1 count

ROBERT LEVELLE FRELIX, a/k/a “Lil Rob,” 24

Minneapolis, MN

Charges:

• Conspiracy – Felon in Possession of Firearms and Ammunition, 1 count
• Felon in Possession of a Firearm, 3 counts
• Felon in Possession of Ammunition, 1 count

SHANE JAMAL JACKSON, a/k/a “Sunny,” 23

Unknown

Charges:

• Conspiracy – Felon in Possession of Firearms and Ammunition, 1 count
• Felon in Possession of a Firearm, 1 count

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

United States Attorney Andrew M. Luger today announced the conviction of WILLIAM ANDREW CLARK, 66, of Blackduck, Minn., for sexually abusing two women on the Red Lake Indian Reservation. On May 12, 2015, CLARK was indicted on one count of Aggravated Sexual Abuse and one count of Sexual Abuse involving these two women. On September 24, 2015, following a two-day trial, United States District Court Judge Donovan W. Frank found CLARK guilty on all counts.

As proven at trial, in the fall of 2013, CLARK sexually assaulted a woman on the Red Lake Indian Reservation. The woman was intoxicated and unconscious when CLARK raped her. On September 11, 2014, CLARK forcibly sexually assaulted another woman, having driven the victim to a remote part of the Red Lake Indian Reservation and raping her.

U.S. District Judge Donovan W. Frank will sentence CLARK at a later date, yet to be scheduled.

This case is the result of an investigation by the Federal Bureau of Investigation and the Red Lake Police Department.

Assistant U.S. Attorney Clifford B. Wardlaw is prosecuting this case.

 

Defendant Information:

WILLIAM ANDREW CLARK, 66

Blackduck, Minn.

Convicted:

• Aggravated Sexual Abuse, 1 count
• Sexual Abuse, 1 count

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the conviction of SEAN GERALD PENONCELLO, 41, for the production of child pornography involving two minor victims. On June 9, 2015, PENONCELLO was charged by superseding indictment with two counts of producing child pornography and one count of possessing child pornography. Following a three-day trial before Judge Patrick J. Schiltz, a jury found PENONCELLO guilty of all counts. A sentencing date has not yet been set.

Assistant U.S. Attorney Laura Provinzino said: “These are among the most difficult but important cases to prosecute. The jury's verdict ensures that a man who is an opportunist and who has repeatedly sexually exploited children cannot do it again.”

Sergeant John Backman of the St. Louis County Sheriff’s Office said: “This conviction will protect other children from the predatory behavior of Mr. Penoncello. In addition, the conviction sends a message to others involved in this underground activity that they will be pursued, located, and brought to justice.”

As proven at trial, on April 3, 2014, a series of nude images of an unidentified five-year-old minor were submitted to the National Center for Missing and Exploited Children (NCMEC) that were traced back to PENONCELLO’s residence in Cherry, Minn. On March 27, 2015, law enforcement executed a search warrant of PENONCELLO’s residence and recovered two hidden thumb drives and a surreptitious recording device taken from PENONCELLO’s truck.

As proven at trial, the evidence contained on the two thumb drives revealed sexually explicit images and videos of a second minor victim, produced when the victim was 14-years-old. The thumb drives also contained numerous pornographic images and videos of other known NCMEC-identified minor victims.

If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.

This case is the result of an investigation conducted by the Federal Bureau of Investigation and the St. Louis County Sheriff’s Office, with assistance from the St. Louis County Attorney’s Office, Virginia Police Department and Eveleth Police Department.

This case is being prosecuted by Assistant U.S. Attorneys Laura M. Provinzino and Benjamin F. Langner.

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

 

Defendant Information:                                                                                                                    

SEAN GERALD PENONCELLO, 41

Iron, Minn.

Convicted:

• Production of Child Pornography, 2 counts
• Possession of Child Pornography, 1 count

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the indictment of ELENA LEV POLUKHIN, 58, for writing prescriptions for pain medication as part of a health care fraud conspiracy in which POLUKHIN received kickbacks from Best Aid Pharmacy. POLUKHIN is charged with conspiracy to commit health care fraud, soliciting and receiving kickbacks, health care fraud, aggravated identity theft and distribution of controlled substances. The defendant made an initial appearance today before Magistrate Judge Steven E. Rau in U.S. District Court in St. Paul, Minn.

“As charged, this defendant abused her position as a doctor, took kickbacks and participated in a significant fraud of Medicare and Medicaid,” said U.S. Attorney Luger. “In addition to funneling kickbacks through a charitable non-profit, Dr. Polukhin wrote unwarranted prescriptions for pain cream and prescribed opioids without any legitimate medical purpose. As Minnesota continues to struggle with our pain pill problem, it is cases like this that so clearly demonstrate the lengths to which some will go to abuse the health care system.”

“Minnesota is not immune to the prescription drug epidemic that continues to plague our nation at an alarming rate,” said Drug Enforcement Administration Assistant Special Agent in Charge Dan Moren. “Dr. Elena Polukhin contributed to this epidemic by keeping patients hooked on addictive pain killers and placing an emphasis on generating profits, by fraudulently billing Medicare and Medicaid, versus fulfilling her obligation to enhance the sound mind and body of her clients.”

"Those who commit health care fraud will be actively pursued by law enforcement. The FBI, along with its partners, will hold health care providers to account if they prey upon those seeking treatment and commit fraud against taxpayers," said Federal Bureau of Investigation Special Agent in Charge Richard Thornton.

“Physicians and pharmacists are entrusted to make decisions that are medically necessary and that are in the best interest of their patients, not for their own personal financial gain”, said Lamont Pugh III, Special Agent in Charge – Chicago Region, U.S. Department of Health and Human Services, Office of Inspector General. “The OIG will continue to work with our law enforcement partners to identify fraud schemes that jeopardize patient safety and well-being and hold those who execute these schemes accountable.”

According to the indictment and documents filed in court, ELENA POLUKHIN was a physician specializing in physical medicine and rehabilitation. She was a participating provider in Medicare and Medicaid. Most of her patients were Medicare and Medicaid beneficiaries. POLUKHIN was the sole owner and CEO of Rehabilitation Consultants in Bloomington, Minn. Rehabilitation Consultants specialized in pain management and rehabilitation.

According to the indictment and documents filed in court, from at least February 2011 through December 2014, POLUKHIN conspired with others to fraudulently bill Medicare and Medicaid for topical pain-relief creams that she prescribed. The defendant referred virtually every patient prescribed topical pain-relief cream to a single pharmacy, Best Aid, which prepared and dispensed the topical pain-relief creams.

According to the indictment and documents filed in court, BORIS LEO RABICHEV, the manager and part-owner of Best Aid who was charged separately by information, and RICHARD WAYNE CUSTER, a pharmacist at Best Aid who was also charged separately by information, compounded pain creams using bulk-powder forms of the various ingredients called for by the prescriptions and dispensed in the pain creams to customers. Best Aid then submitted claims for reimbursement to Medicare and Medicaid that falsely represented that the pain creams had been made using tablet, capsule or liquid forms of the various ingredients in the pain creams.  By including these false representations, Best Aid generated inflated reimbursements on the pain creams. In exchange for POLUKHIN referring all of the prescriptions for these pain creams to Best Aid, RABICHEV paid POLUKHIN more than $40,000 in kickbacks.

According to the indictment and documents filed in court, RABICHEV, at POLUKHIN’s request, made monthly kickback payments to POLUKHIN in the form of checks payable to the Roife-Nissenbaum Trust (RN Trust). The RN Trust was a 501(c)(3) charitable trust founded by POLUKHIN, who also acted as its chair of the board and president. The RN Trust purportedly supported several programs and services, including scholarships to students; a directory of medical providers; fitness programs; humanitarian missions and international collaborations; a mental health and chemical dependency program; medical research; and a “starving artists project.” Between at least June 2012 and March 2014, Best Aid wrote at least 20 checks to the RN Trust for the purpose of paying more than $43,000 of kickbacks to POLUKHIN.

According to the indictment and documents filed in court, POLUKHIN also knowingly wrote prescriptions, on at least one occasion, for morphine and oxycodone in the absence of a legitimate medical purpose and outside the course of usual professional practice.

This case is the result of an investigation conducted by the Drug Enforcement Administration (DEA)  Tactical Diversion Squad, which is comprised of agents, officers and deputies from the DEA, Federal Bureau of Investigation, Food and Drug Administration, Minneapolis Police Department, Plymouth Police Department, Ramsey County Sheriff’s Office, Washington County Sheriff’s Office, the Minnesota Army National Guard, and the U.S. Department of Health and Human Services – Office of Inspector General.

The DEA Tactical Diversion Squad has established a hotline if you have information or questions concerning Rehabilitation Consultants and/or Dr. Elena Polukhin – please call 612-344-4189. To provide information online related to Rehabilitation Consultants and/or Dr. Polukhin, please visit www.deadiversion.usdoj.gov and select the “Report Illicit Pharmaceutical Activities - RX Abuse Reporting Link.”

This case is being prosecuted by Assistant United States Attorney John E. Kokkinen.

 

Defendant Information:

ELENA LEV POLUKHIN, 58

Minnetonka, Minn.

Charges:

• Conspiracy to commit health care fraud, 1 count
• Soliciting and receiving kickbacks, 20 counts
• Health care fraud, 3 counts
• Aggravated identity theft, 3 counts
• Distribution of controlled substances, 2 counts

 

 

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

United States Attorney General Loretta Lynch and United States Attorney Andrew M. Luger today announced Office of Community Oriented Policing Services (COPS Office) funding awards to five cities and counties in the District of Minnesota, aimed at creating, and in some cases protecting, 23 law enforcement positions. Over $107 million will be awarded nationally, through the COPS Hiring Program (CHP), including $2,875,000 in the District of Minnesota.

The list of this year’s grantees includes: The City of Aitkin, the Hennepin County Sheriff’s Department, the Mille Lacs County Sheriff’s Department, St. Cloud Police Department, and the City of St. Paul.

“Working with our local law enforcement partners on a wide array of cases is critical to upholding justice in Minnesota,” said U.S. Attorney Luger. “COPS grants to grow local police and sheriff’s departments are an important resource from the federal government to benefit local cities and counties. I am gratified that our local partners are benefitting from this investment in our communities.”

“The COPS Office is pleased to assist local law enforcement agencies throughout the country in addressing their most critical public safety issues,” said Ronald L. Davis, Director of the COPS Office. “These grants are not simply about putting more officers on the street, they are about expanding the capacity of law enforcement agencies to engage in community policing.”

CHP provides grants to state, local and tribal law enforcement agencies to hire or rehire community policing officers. The program provides salaries and benefits for officer and deputy hires for three years.

Priority consideration was given this year to agencies that selected any of the Building Trust focus areas or School Based Policing through School Resource Officers. All applicants were encouraged to refer to the report of the President's Task Force on 21st Century Policing for suggested actions to incorporate into their proposed community policing strategy.

The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1995, COPS has invested over $14 billion to advance community policing, including grants awarded to more than 13,000 state, local, and tribal law enforcement agencies to fund the hiring and redeployment of approximately 127,000 officers and provide a variety of knowledge resource products including publications, training, and technical assistance.

For the entire list of grantees and additional information about the 2015 COPS Hiring Program, visit the COPS website at www.cops.usdoj.gov.

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

United States Attorney Andrew M. Luger, Assistant Attorney General John P. Carlin and FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton today announced the guilty plea of ZACHARIA YUSUF ABDURAHMAN, 20, who conspired with at least eight other individuals to travel to Syria in an effort to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization. MUSSE was initially charged by criminal complaint on April 20, 2015, and was subsequently indicted on May 19, 2015. ABDURAHMAN pleaded guilty today before Senior U.S. District Judge Michael Davis in United States District Court in Minneapolis, Minn.

“Zacharia Abdurahman is the third co-conspirator to plead guilty and admit in detail his longstanding efforts to join ISIL,” said U.S. Attorney Luger. “Despite being stopped by federal agents on his first attempt, Abdurahman continued to seek ways to join this terrorist group. We hope that Abdurahman’s guilty plea today, and those of Hanad Musse and Abdullahi Yusuf before him, deter others from planning to join ISIL.”

“Zacharia Yusuf Abdurahman conspired to provide material support to ISIL and attempted to travel to Syria to join their ranks overseas,” said Assistant Attorney General Carlin.  “Counterterrorism is the National Security Division’s highest priority, and we remain committed to stemming the flow of foreign fighters abroad and bringing to justice those who attempt to provide material support to terrorists.”

“The FBI will continue to fight terrorism recruitment and material support with every available resource,” said Special Agent in Charge Thornton. “We stand alongside our Somali community partners in Minnesota to prevent terror groups from targeting their youth.”

As admitted by the defendant in his guilty plea, between March and June 2014, ABDURAHMAN became aware of individuals in the United States and abroad who had traveled or desired to travel overseas to join ISIL. ABDURAHMAN joined this group of aspiring travelers with the understanding that ISIL was a designated foreign terrorist organization that engaged in terrorism and terrorist activity. The defendant participated in several meetings throughout 2014 in which he and his co-conspirators discussed traveling to Syria to join ISIL, including how they would pay for such travel, what routes they could take from Minnesota to Syria to best elude law enforcement, and the feasibility of using fraudulent travel documents to travel to Syria.

As admitted by the defendant in his guilty plea, by June 2014, ABDURAHMAN knew that co-conspirator Abdi Nur had successfully traveled to Syria and that co-conspirator Abdullahi Yusuf had attempted to travel to Syria but had been stopped by law enforcement at the Minneapolis/St. Paul International Airport. Nevertheless, ABDURAHMAN continued to make preparations to travel to Syria to join ISIL.

As admitted by the defendant in his guilty plea, on November 6, 2014, ABDURAHMAN and co-conspirators MOHAMED FARAH, HAMZA AHMED, and HANAD MUSSE purchased bus tickets from Minneapolis to New York City, where they met at John F. Kennedy International Airport (JFK). While at JFK, ANDURAHMAN purchased a round-trip ticket to Athens, Greece, which he planned to use as a transit point from which to travel to Syria. MUSSE knew that ABDURAHMAN purchased a ticket on the same flight for the same purpose. After being prevented by federal agents from boarding his flight, MUSSE lied to federal agents about the true nature of his travel.

As admitted by the defendant in his guilty plea, after their failed November 2014 attempt to fly overseas, ABDURAHMAN and co-conspirators MOHAMED FARAH, MUSSE, and AHMED met to discuss and coordinate false responses to anticipated law enforcement questions in an effort to conceal their intention to travel to Syria to join ISIL.

As admitted by the defendant in his guilty plea, he continued to meet with his co-conspirators throughout the winter and spring of 2015 to discuss and plan another attempt to travel to Syria to join ISIL. As a result of some of those meetings, ABDURAHMAN willingly agreed to participate in a scheme to obtain false passports, travel from Minnesota to Mexico, and fly overseas to join ISIL using those false passports. On April 1, 2015, ABDURAHMAN provided a passport photo of himself to an individual he believed would be traveling with him. Unbeknownst to the defendant, the individual was a cooperating human source (CHS). On April 3, 2015, ABDURAHMAN asked the CHS for the return of his passport photograph, fearing the number of co-conspirators involved in the plot to leave the United States for Syria increased the probability of getting caught by law enforcement. However, ABDURAHMAN admits that he did not withdraw from the conspiracy to provide material support to ISIL when he sought return of the passport photo. Rather, ABDURAHMAN was attempting to preserve the viability of his and his co-conspirators’ future travel to Syria. ABDURAHMAN on April 3, 2015, further provided $100 in U.S. currency to the CHS as a down payment for co-defendant MOHAMED FARAH’s false passport which the defendant knew would be used by MOHAMED FARAH to attempt to travel to Syria to join ISIL.

This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.

This case is being prosecuted by Assistant United States Attorneys Andrew R. Winter and John Docherty with assistance provided by the National Security Division's Counterterrorism Section.

 

Defendant Information:                                                                                                                    

ZACHARIA YUSUF ABDURAHMAN, 20

Columbia Heights, Minn.

Convicted:

• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count

 

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Zacharia Yusuf Abdurahman, 20, of Columbia Heights, Minnesota, pleaded guilty to conspiring with at least eight other individuals to travel to Syria in an effort to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization. 

Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Andrew M. Luger of the District of Minnesota and Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Division made the announcement.

“Zacharia Yusuf Abdurahman conspired to provide material support to ISIL and attempted to travel to Syria to join their ranks overseas,” said Assistant Attorney General Carlin.  “Counterterrorism is the National Security Division’s highest priority, and we remain committed to stemming the flow of foreign fighters abroad and bringing to justice those who attempt to provide material support to terrorists.”

“Zacharia Abdurahman is the third co-conspirator to plead guilty and admit in detail his longstanding efforts to join ISIL,” said U.S. Attorney Luger.  “Despite being stopped by federal agents on his first attempt, Abdurahman continued to seek ways to join this terrorist group. We hope that Abdurahman’s guilty plea today, and those of Hanad Musse and Abdullahi Yusuf before him, deter others from planning to join ISIL.”

“The FBI will continue to fight terrorism recruitment and material support with every available resource,” said Special Agent in Charge Thornton.  “We stand alongside our Somali community partners in Minnesota to prevent terror groups from targeting their youth.”

Abdurahman was initially charged by criminal complaint on April 20, 2015, and was subsequently indicted on May 19, 2015.  Abdurahman pleaded guilty today before Senior U.S. District Judge Michael Davis of the District of Minnesota.

As admitted by the defendant in his guilty plea, between March and June 2014, Abdurahman became aware of individuals in the United States and abroad who had traveled or desired to travel overseas to join ISIL.  Abdurahman joined this group of aspiring travelers with the understanding that ISIL was a designated foreign terrorist organization that engaged in terrorism and terrorist activity.  The defendant participated in several meetings throughout 2014 in which he and his co-conspirators discussed traveling to Syria to join ISIL, including how they would pay for such travel, what routes they could take from Minnesota to Syria to best elude law enforcement and the feasibility of using fraudulent travel documents to travel to Syria.

As admitted by the defendant in his guilty plea, by June 2014, Abdurahman knew that co-conspirator Abdi Nur had successfully traveled to Syria and that co-conspirator Abdullahi Yusuf had attempted to travel to Syria but had been stopped by law enforcement at the Minneapolis/St. Paul International Airport.  Nevertheless, Abdurahman continued to make preparations to travel to Syria to join ISIL.

As admitted by the defendant in his guilty plea, on Nov. 6, 2014, Abdurahman and co-conspirators Mohamed Farah, Hamza Ahmed and Hanad Musse purchased bus tickets from Minneapolis to New York City, where they met at John F. Kennedy International Airport (JFK). While at JFK, Abdurahman purchased a round-trip ticket to Athens, Greece, which he planned to use as a transit point from which to travel to Syria.  After being prevented by federal agents from boarding his flight, Abdurahman lied to federal agents about the true nature of his travel.

As admitted by the defendant in his guilty plea, after their failed November 2014 attempt to fly overseas, Abdurahman and co-conspirators Farah, Musse and Ahmed met to discuss and coordinate false responses to anticipated law enforcement questions in an effort to conceal their intention to travel to Syria to join ISIL.

As admitted by the defendant in his guilty plea, he continued to meet with his co-conspirators throughout the winter and spring of 2015 to discuss and plan another attempt to travel to Syria to join ISIL.  As a result of some of those meetings, Abdurahman willingly agreed to participate in a scheme to obtain false passports, travel from Minnesota to Mexico, and fly overseas to join ISIL using those false passports.  On April 1, 2015, Abdurahman provided a passport photo of himself to an individual he believed would be traveling with him.  Unbeknownst to the defendant, the individual was a cooperating human source (CHS).  On April 3, 2015, Abdurahman asked the CHS for the return of his passport photograph, fearing the number of co-conspirators involved in the plot to leave the United States for Syria increased the probability of getting caught by law enforcement.  However, Abdurahman admits that he did not withdraw from the conspiracy to provide material support to ISIL when he sought return of the passport photo.  Rather, Abdurahman was attempting to preserve the viability of his and his co-conspirators’ future travel to Syria.  Abdurahman on April 3, 2015, further provided $100 in U.S. currency to the CHS as a down payment for co-defendant Farah’s false passport which the defendant knew would be used by Farah to attempt to travel to Syria to join ISIL.

This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.  This case is being prosecuted by Assistant U.S. Attorneys Andrew R. Winter and John Docherty with assistance provided by the National Security Division's Counterterrorism Section.

United States Attorney Andrew M. Luger today announced a $130,000 settlement with RICHARD EDLICH, Cities Home Rentals, Inc., MDC 2000 Investments, Inc., and Rifive Investments, LLC (collectively the “Defendants”) to resolve allegations that the Defendants violated the False Claims Act by charging Section 8 tenants illegal side payments.

To qualify for federal subsidies, the Defendant landlords certified in their contracts with local housing authorities that they would not charge side payments to Section 8 tenants above the rental amount, which was determined by local housing authorities based in part on the tenants’ income.  However, between August 2007 and July 2014, Defendants allegedly collected at least $60,000 in illegal side payments from sixteen Section 8 tenants.

The Department of Housing and Urban Development (HUD) provides federal funding for Section 8 (officially called the Housing Choice Voucher Program).  Housing choice vouchers are administered by local housing authorities.  The housing subsidy is paid to the landlord directly by the local housing authority on behalf of the participating family.  The family then pays the difference between the actual rent charged by the landlord and the amount subsidized by the program.  HUD prohibits Section 8 landlords from charging the tenant any additional payments to ensure that rent is affordable for tenants, and to prevent landlords from taking advantage of low-income tenants seeking affordable housing.

“The False Claims Act is an important tool to protect the integrity of the Housing Choice Voucher program, and to ensure that landlords receiving federal subsidies abide by their commitments to the federal government and to their tenants,” said Assistant U.S. Attorney Pamela Marentette, who represented the United States in this matter.

The settlement resolves allegations originally brought forward by one of the tenants, Meria Murray.  Ms. Murray filed her suit under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and share in any recovery.  According to Ms. Murray’s complaint, Defendants insisted that she pay over $5,000 in side payments between 2009 and 2011 for a property she rented in Minneapolis.

The settlement agreement requires the Defendants to pay $130,000 to the United States. Ms. Murray will receive $18,000 as her share of the recovery in this case.

The case was handled by the U.S. Attorney’s Office for the District of Minnesota, and investigated and supported by the U.S. Department of Housing and Urban Development-Office of Inspector General.

The lawsuit is captioned U.S. ex rel. Meria T. Murray v. Richard Edlich, et. al. Case No.

 13-sc-845 (JRT/JSM).  The claims settled by this agreement are allegations only; there has been no determination of liability.

 

 

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United States Attorney Andrew M. Luger today announced the sentencing of ANTHONY DOANE EDGE, 36, and DEBORAH SUSAN EDGE, 37, each of whom pleaded guilty to manufacturing child pornography.  The defendants were sentenced yesterday before Senior U.S. District Judge Michael Davis in U.S. District Court in Minneapolis, Minn.                               

According to the defendants’ guilty pleas and documents filed in court, sometime between October 6, 2013, and March 27, 2014, A. EDGE and D. EDGE used a six-year-old minor for the purpose of making a sexually explicit video of the minor’s genitals and pubic area.

According to the defendants’ guilty pleas, A. EDGE made child pornography videos of two young girls in the bathroom of his home using pin-hole cameras disguised to look like household objects, one in the shape of a plastic coat hook and one in the shape of an ink pen. D. EDGE participated in making a child pornography video of one of the young girls. Moreover, more than one thousand suspected images of child pornography were recovered from computers seized at the Edge residence, including many depictions of the sexual exploitation of pre-pubescent children and infants.

This case is the result of an investigation by the Minnesota Bureau of Criminal Apprehension and the Austin Police Department.

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

If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.

Assistant U.S. Attorneys Katharine T. Buzicky and Carol M. Kayser prosecuted this case.

 

Defendant Information:

ANTHONY DOANE EDGE, 36

Austin, Minn.

Convicted:

• Production of child pornography, 1 count

Sentenced:

• 25 years in federal prison

DEBORAH SUSAN EDGE, 37

Austin, Minn.

Convicted:

• Production of child pornography, 1 count

Sentenced:

• 10 years in federal prison

 

 

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A Minnesota National Guardsman pleaded guilty today to inducing a 14-year-old girl to create and send to him sexually explicit photos over the Internet while he was deployed to Afghanistan.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Andrew M. Luger of the District of Minnesota made the announcement.

Andrew Schiller, 28, of Lakeville, Minnesota, pleaded guilty before U.S. District Judge Susan Richard Nelson of the District of Minnesota to one count of production of child pornography.  The sentencing hearing will be scheduled at a later date.

According to his guilty plea, between Sept. 23, 2013, and Jan. 12, 2014, while deployed to Afghanistan, Schiller contacted a 14-year-old female from Minnesota online, and requested that she create and forward to him via the Internet sexually explicit photos of herself.  The victim did, in fact, send several images in response to Schiller’s requests, including at least one sexually explicit image.  Schiller further admitted that he communicated online with numerous other minors, including a 14-year-old and a 15-year-old, and that he attempted to convince the minors to send to him via the Internet sexually explicit videos or images of themselves.

This case is being investigated by the Army Criminal Investigative Division and the FBI, and anyone with additional information about this case should call the FBI Minneapolis Field Office at 763-569-8000.  This case is being prosecuted by Trial Attorney Jeffrey H. Zeeman of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Katherine T. Buzicky of the District of Minnesota. 

This case was brought as part of Project Safe Childhood, a nationwide initiative, launched in May 2006, to combat the growing epidemic of child sexual exploitation and abuse.  Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.  In addition, if you know of any child who may have been a victim of exploitation, please contact the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.

Schiller Plea Agreement

U.S. Attorney Andrew M. Luger and Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division today announced the guilty plea of a Minnesota National Guardsman to inducing a 14-year-old girl to create and send to him sexually explicit photos over the Internet while he was deployed to Afghanistan.

Andrew Schiller, 28, of Lakeville, Minnesota, pleaded guilty before U.S. District Judge Susan Richard Nelson of the District of Minnesota to one count of production of child pornography.  The sentencing hearing will be scheduled at a later date.

According to his guilty plea, between Sept. 23, 2013, and Jan. 12, 2014, while deployed to Afghanistan, Schiller contacted a 14-year-old female from Minnesota online, and requested that she create and forward to him via the Internet sexually explicit photos of herself.  The victim did, in fact, send several images in response to Schiller’s requests, including at least one sexually explicit image.  Schiller further admitted that he communicated online with numerous other minors, including a 14-year-old and a 15-year-old, and that he attempted to convince the minors to send to him via the Internet sexually explicit videos or images of themselves.

This case is being investigated by the Army Criminal Investigative Division and the FBI, and anyone with additional information about this case should call the FBI Minneapolis Field Office at 763-569-8000.  This case is being prosecuted by Trial Attorney Jeffrey H. Zeeman of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Katherine T. Buzicky of the District of Minnesota.

This case was brought as part of Project Safe Childhood, a nationwide initiative, launched in May 2006, to combat the growing epidemic of child sexual exploitation and abuse.  Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.  For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.  In addition, if you know of any child who may have been a victim of exploitation, please contact the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.

 

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United States Attorney Andrew M. Luger today announced the indictment of WILLIAM JAMES DAVIS, 64, and JORDAN JAMES DAVIS, 34, for conspiring to steal funds from Community Action of Minneapolis (CAM) for the use of WILLIAM and JORDAN DAVIS. At all times relevant, WILLIAM DAVIS was the CEO of CAM, a non-profit organization created to provide services to low-income residents of Minneapolis and focusing on the elimination of poverty. CAM provided services including weatherization of homes, energy assistance, nutrition assistance and services for children and families. JORDAN DAVIS is expected to make an initial appearance tomorrow in U.S. District Court in St. Paul, Minn.

“This indictment charges a former non-profit leader and a police officer with stealing funds intended to keep Minnesotans warm during the winter,” said U.S. Attorney Luger. “This office will prosecute aggressively those who abuse needed public resources for personal gain.”

“Allegations into the misuse of hard-earned taxpayer money for personal gain are taken very seriously by the FBI and our law enforcement partners,” said FBI Special Agent in Charge for the Minneapolis Division Richard T. Thornton. “We will continue to pursue and address these cases with the highest investigative priority.” 

According to the indictment and documents filed in court, CAM’s primary funding sources consisted of federal grants administered by the Minnesota Department of Commerce and Minnesota Department of Human Services. CAM also received funding from CenterPoint Energy (CenterPoint) and Xcel Energy (Xcel) in exchange for providing certain conservation and weatherization services to qualifying homeowners.

According to the indictment and documents filed in court, WILLIAM DAVIS was issued a credit card as CEO of CAM, for which CAM paid the balance due each month. W. DAVIS was required to use his corporate card “for agency authorized activities only.” As part of his scheme to defraud CAM, W. DAVIS concealed his diversion of CAM funds to his personal use by charging the majority of his CAM-paid personal expenses to a slush fund on CAM’s books. The slush fund was created using excess funds provided by CenterPoint and Xcel in exchange for CAM’s agreement to provide certain conservation and weatherization services to qualifying homeowners. If CAM could provide the services for less than the amounts provided by CenterPoint and Xcel, CAM was allowed to keep the difference for other CAM-related activities. CAM carried these funds on its books in a slush fund not subject to the same oversight as CAM’s state and federal grant proceeds. W. DAVIS could therefore instruct CAM’s fiscal staff to charge personal expenses to this slush fund with less risk of detection.

According to the indictment and documents filed in court, W. DAVIS used intimidation and retaliation to prevent CAM staff from informing anyone, including CAM’s Board of Directors, that he was using his position as CAM’s CEO to divert CAM funds to his personal use and that of his family and friends. For example, W. DAVIS issued written reprimands to employees, prohibited employees from communicating with state agencies and CAM’s financial auditors, threatened employees with suspension and termination, and ordered one CAM employee to look up the definitions of the words “insubordination” and “loyalty” after the employee contradicted W. DAVIS in front of other employees.

According to the indictment and documents filed in court, between March 2007 and October 2014, at least $250,000 in CAM funds intended to be used to provide services to low-income residents of Minneapolis were instead diverted to W. DAVIS’ personal use and the use of his family and friends, including JORDAN DAVIS. As part of the scheme, W. DAVIS caused CAM funds to be used for personal expenses, including airline tickets, hotel stays, rental cars and a Caribbean cruise. In total, between January 2009 and October 2014, W. DAVIS caused $77,000 of CAM funds to be used for personal travel expenses for himself and his friends and family members.

According to the indictment and documents filed in court, W. DAVIS used CAM funds to pay for his personal vehicle, a 2011 Chrysler 300. In May 2011, W. DAVIS traded in a 2005 Chrysler 300 owned by CAM. He then used the $10,079.53 in proceeds from the trade-in of the CAM vehicle toward the purchase of the 2011 Chrysler 300 for himself. W. DAVIS used CAM funds to pay the remaining $36,430 balance of the purchase price of the 2011 Chrysler 300. Nearly four months later, W. DAVIS emailed three members of the CAM Board of Directors to authorize a personal loan from CAM for the purchase of the vehicle. He did not disclose that he had already purchased the vehicle using CAM funds, nor did he disclose that he had applied the trade-in value of the CAM-owned 2005 Chrysler 300 toward the purchase of the new vehicle.

According to the indictment and documents filed in court, W. DAVIS also used CAM funds to pay JORDAN DAVIS for a no-show job at a Ben & Jerry’s ice cream shop operated by CAM. CAM operated a Ben & Jerry’s PartnerShop near the University of Minnesota campus in Minneapolis. Ben & Jerry’s waived its standard franchise fees so that CAM could use the store to offer job and entrepreneurial training to underprivileged youth facing barriers to employment.

According to the indictment and documents filed in court, between 2002 and October 2006, WILLIAM DAVIS’s son JORDAN DAVIS, worked as the manager of the Ben & Jerry’s PartnerShop. In October 2006, J. DAVIS obtained employment with the Minneapolis Police Department, and thereafter stopped working at the Ben & Jerry’s. CAM hired a new manager for the store a few months later.

According to the indictment and documents filed in court, W. DAVIS instructed CAM’s fiscal staff to continue issuing J. DAVIS the full paycheck he had been receiving for managing the ice cream shop. W. DAVIS concealed this from CAM’s Board of Directors. From at least March 2007 until January 2011, J. DAVIS continued to receive his full paycheck, $1,320 biweekly, for his work at the Ben & Jerry’s, even though he was doing no work for the ice cream shop. J. DAVIS endorsed and deposited the paychecks every two weeks. In total, J. DAVIS endorsed and deposited at least 105 paychecks for his no-show job.

According to the indictment and documents filed in court, during the nearly four years that J. DAVIS was being paid for his no-show job, CAM’s fiscal staff repeatedly advised W. DAVIS to stop the payments, but W. DAVIS refused. On December 20, 2010, W. DAVIS sent an email to CAM’s CFO in which W. DAVIS agreed that J. DAVIS’s “last day on payroll for Ben & Jerry’s is Dec. 31st.” W. DAVIS instructed CAM’s CFO to issue J. DAVIS his ordinary payroll check on December 31st, along with a “bonus check for $6,000.” As a result of W. DAVIS and J. DAVIS’s fraud scheme, CAM paid J. DAVIS more than $140,000 for a job he did not perform. In April 2011, CAM closed the Ben & Jerry’s PartnerShop because CAM could no longer afford the rent for the store, and CAM terminated its youth job skills training program.

According to the indictment and documents filed in court, in October 2013, the Minnesota Department of Human Services (DHS) began an audit intended to determine whether CAM was using the federal and state grant funds that it received through DHS in accordance with the applicable contracts. DHS personnel sought documents and information about the purposes of various CAM expenditures. Throughout the first several months of 2014, W. DAVIS resisted DHS’s requests for information.

According to the indictment and documents filed in court, in May 2014, DHS provided a draft audit report to W. DAVIS, as well as to CAM’s CFO and the Chair of CAM’s Board of Directors. The draft audit indicated unallowable travel expenses for W. DAVIS had been charged to the grants. W. DAVIS subsequently sent correspondence containing false material representations about his personal travel. On June 3, 2014, W. DAVIS attended a meeting with DHS personnel to discuss the report’s findings. Two days later, W. DAVIS flew to Phoenix, Ariz., to visit his girlfriend using an airline ticket he caused to be purchased with CAM funds. On October 13, 2014, W. DAVIS was suspended from his position as CEO without pay.

This case is the result of an investigation conducted by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, United States Department of Health and Human Services Office of the Inspector General and the United States Department of Energy Office of the Inspector General.

This case is being prosecuted by Assistant United States Attorney Kimberly A. Svendsen.

 

Defendant Information:

WILLIAM JAMES DAVIS, 64

Brooklyn Park, Minn.

Charges:

• Conspiracy to commit theft concerning programs receiving federal funds, 1 count
• Mail fraud, 10 counts
• Wire fraud, 1 count
• Theft concerning programs receiving federal funds, 4 counts

JORDAN JAMES DAVIS, 34

Otsego, Minn.

Charges:

• Conspiracy to commit theft concerning programs receiving federal funds, 1 count
• Mail fraud, 5 counts

 

 

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The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

United States Attorney Andrew M. Luger today was joined by public and private partners in the Building Community Resilience pilot project to announce the project’s first-year accomplishments.  Building Community Resilience was designed in close coordination with Minnesota’s Somali community, government stakeholders and private partners to address the root causes of radicalization.

Since Al Shabaab began recruiting Minnesota’s youth in 2006, the Twin Cities have been a focus of overseas terror recruiting by organizations like the Islamic State for Iraq and the Levant (ISIL). This cycle of terror recruiting has exclusively targeted Minnesota’s Somali community, which is why Building Community Resilience is delivering resources to the Somali community.

The highlights of the Building Community Resilience plan include: a mentorship program for Somali youth operated by Big Brothers Big Sisters of the Greater Twin Cities, with initial funding from the Carlson Family Foundation; the Opportunity Hub, which is a public, private and community partnership to provide a one-stop shop for education and workforce resources located in the cedar riverside neighborhood; nearly $500,000 of private and government grant funding to be administered by Youthprise.

Youthprise is a non-profit organization that strategically combines funding, capacity building, policy advocacy, research, and youth engagement under one roof. As an intermediary, Youthprise acts as an incubator, connector and relationship broker, forging connections between community-based organizations, schools, funders, public agencies, youth and adults. Youthprise convenes stakeholders; provides training, coaching and technical assistance; and links organizations doing similar work.

“Today, at the end of the first year of work, we are announcing some of the accomplishments of the Building Community Resilience pilot program,” said U.S. Attorney Luger. “We have developed strong friendships, working relationships and important partnerships to build this plan. This is just the beginning of what we hope to accomplish, and we’re very excited about where we are today.”

“Minneapolis’ Somali community is a tremendous asset to our city,” said Minneapolis Mayor Betsy Hodges. “We must all support this community and their ability to contribute to our prosperity, or we will not be the city we need to be. The extent to which some people in the community are turning to violence as a perceived solution to problems is the extent to which we must provide actual solutions to real problems that people are facing like poverty, unemployment, and homelessness. The steps we are taking today build on our work to strengthen the Somali community. These efforts are critical to ensuring that harming others is never a solution to any problem.”

“The recruitment of a single resident from our city is unacceptable,” said Minneapolis Council Member Abdi Warsame. “My office has been working with federal, state, county and city officials to connect existing opportunities to the East African community in order to tackle the underlining conditions that make our young people vulnerable.”

“This has been one of the greatest opportunities to voice community issues that have traditionally been ignored,” said Hodan Hassan, co-chair of the Somali American Task Force. “If we save even one young person through this collaboration between community, government, and private-sector partners, our mission is accomplished.”

“We are proud to support the ‘Building Community Resilience’ initiative,” said Rich Hoge, Executive Vice President, Mall of America. “Today is about opportunity, solutions and hope. It is a first step in working together to address the challenges we face collectively. We are honored to be a partner in this exciting new program.”

“We are thrilled to be a part of this groundbreaking public/private partnership,” said Wokie Weah, President of Youthprise. “Since our inception, Youthprise has been a huge supporter of Somali-led organizations serving youth and families. Our role in this partnership will build on this work by strengthening the capacity of Somali-led organizations and providing critical funding for youth empowerment. Youthprise will conduct an open competitive process in the distribution of grant funds to community based organizations.”

“We're pleased that Big Brothers Big Sisters of the Greater Twin Cities will be part of this important initiative,” said Gloria Lewis, CEO, Big Brothers Big Sisters of the Greater Twin Cities. “Mentoring helps to foster success in school, improve social and emotional learning, and raise educational expectations. We’re eager to work with the Somali-American community in the Twin Cities bring the positive effects of mentoring to youth who can benefit from the presence of an additional, caring adult, and to help nurture the next generation of our community's citizens and leaders.”

“That I (as a minority member) was able to get this into a major Appropriations bill late in the process indicates the legislatures understanding of the importance of this issue and the need for new approaches,” said State Representative Phyllis Kahn. “I am pleased to be here at this next step.”

 

Building Community Resilience partners include:

 

Big Brothers Big Sisters of the Greater Twin Cities

Carlson Family Foundation

City of Minneapolis

City of St. Paul

Hennepin County

Mall of America

Somali-American Task Force

State of Minnesota

Youthprise

United States Transportation Security Administration

United States Customs and Border Protection

United States Department of Justice

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

Defendant is the Second of Nine Co-Conspirators to Plead Guilty

Hanad Mustofe Musse, 19, of Minneapolis, pleaded guilty today to conspiring with at least eight other individuals to travel to Syria in an effort to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization.  Musse was initially charged by criminal complaint on April 20, 2015, and was subsequently indicted on May 19, 2015.  Musse pleaded guilty today before Senior U.S. District Judge Michael J. Davis of the District of Minnesota.

Assistant Attorney General for National Security John P. Carlin and U.S. Attorney Andrew M. Luger of the District of Minnesota made the announcement.

“Hanad Mustofe Musse conspired to provide material support to ISIL and attempted to travel to Syria to join their ranks overseas,” said Assistant Attorney General Carlin.  “The National Security Division’s highest priority is counterterrorism and we will continue to pursue justice against those who seek to provide material support to designated foreign terrorist organizations.”

“The facts set forth in Mr. Musse’s guilty plea underscore the length and breadth of this criminal conspiracy,” said U.S. Attorney Luger.  “This defendant made multiple attempts to leave Minnesota to join ISIL – criminal prosecution was the best remaining option to stop him and potentially save his life.  Twin Cities’ youth continue to be the targets of an intense recruiting campaign by ISIL.  Fighting back is the shared responsibility of a wide cross-section of Minnesotans – parents, religious leaders, teachers, community leaders and law enforcement. We must continue to work together to end the cycle of recruiting.”

As the defendant admitted in his guilty plea, between March and June 2014, Musse became aware of individuals in the United States and abroad who had traveled or desired to travel overseas to join ISIL.  Musse joined this group of aspiring travelers with the understanding that ISIL was a designated foreign terrorist organization that engaged in terrorism and terrorist activity.  The defendant participated in several meetings throughout 2014 in which he and his co-conspirators discussed traveling to Syria to join ISIL, including how they would pay for such travel, what routes they could take from Minnesota to Syria to best elude law enforcement and the feasibility of using fraudulent travel documents to travel to Syria.

Musse also admitted in his plea that by June 2014, he knew that co-conspirator Abdi Nur had successfully traveled to Syria and that co-conspirator Abdullahi Yusuf had attempted to travel to Syria but had been stopped by law enforcement at the Minneapolis/St. Paul, Minnesota, International Airport.  Nevertheless, Musse continued to make preparations to travel to Syria to join ISIL.  Between Oct. 20, 2014, and Nov. 6, 2014, Musse made five cash withdrawals from his federal financial aid account totaling $2,400.  He deposited those funds in a personal checking account that he opened on Nov. 3, 2014.  Musse later used those funds to purchase a bus ticket from Minneapolis to New York City.

As admitted by the defendant in his guilty plea, on Nov. 6, 2014, Musse and co-conspirators Mohamed Farah, Hamza Ahmed and Zacharia Abdurahman purchased bus tickets from Minneapolis to New York City, where they met at John F. Kennedy International Airport (JFK).  While at JFK, Musse purchased a round-trip ticket to Athens, Greece, which he planned to use as a transit point from which to travel to Syria.  Musse knew that Abdurahman purchased a ticket on the same flight for the same purpose.  After being prevented by federal agents from boarding his flight, Musse lied to the agents about the true nature of his travel.

The defendant admitted in his guilty plea that after their failed November 2014 attempt to fly overseas, Musse and co-conspirators Mohamed Farah, Abdurahman and Ahmed met to discuss and coordinate false responses to anticipated law enforcement questions in an effort to conceal their intention to travel to Syria to join ISIL.

Musse admitted in his guilty plea that he continued to meet with his co-conspirators throughout the winter and spring of 2015 to discuss and plan another attempt to travel to Syria to join ISIL.  As a result of some of those meetings, Musse willingly agreed to participate in a scheme to obtain false passports, travel from Minnesota to Mexico and fly overseas to join ISIL using those false passports.  On April 6, 2015, Musse provided a passport photo of himself to a co-conspirator for the purpose of creating a fake passport.  Unbeknownst to the defendant, the individual was a cooperating human source (CHS).  When Musse’s family learned of his plan to travel, Musse requested the return of the photograph from the CHS.  However, Musse admits that he did not withdraw from the conspiracy to provide material support to ISIL when he sought return of the passport photo.  Rather, Musse was attempting to preserve the viability of his and his co-conspirators’ future travel to Syria.

This case is being investigated by the FBI-led Joint Terrorism Task Force.  This case is being prosecuted by Assistant U.S. Attorneys Andrew R. Winter and John F. Docherty of the District of Minnesota, with assistance provided by the National Security Division’s Counterterrorism Section.

United States Attorney Andrew M. Luger and Assistant Attorney General John P. Carlin today announced the guilty plea of HANAD MUSTOFE MUSSE, 19, who conspired with at least eight other individuals to travel to Syria in an effort to provide material support to the Islamic State of Iraq and the Levant (ISIL), a designated foreign terrorist organization. MUSSE was initially charged by criminal complaint on April 20, 2015, and was subsequently indicted on May 19, 2015. MUSSE pleaded guilty today before Senior U.S. District Judge Michael Davis in United States District Court in Minneapolis, Minn.

“The facts set forth in Mr. Musse’s guilty plea underscore the length and breadth of this criminal conspiracy,” said U.S. Attorney Luger. “This defendant made multiple attempts to leave Minnesota to join ISIL – criminal prosecution was the best remaining option to stop him and potentially save his life. Twin Cities’ youth continue to be the targets of an intense recruiting campaign by ISIL. Fighting back is the shared responsibility of a wide cross-section of Minnesotans – parents, religious leaders, teachers, community leaders and law enforcement. We must continue to work together to end the cycle of recruiting.”

“Hanad Mustofe Musse conspired to provide material support to ISIL and attempted to travel to Syria to join their ranks overseas,” said Assistant Attorney General Carlin. “The National Security Division's highest priority is counterterrorism and we will continue to pursue justice against those who seek to provide material support to designated foreign terrorist organizations.”

As admitted by the defendant in his guilty plea, between March and June 2014, MUSSE became aware of individuals in the United States and abroad who had traveled or desired to travel overseas to join ISIL. MUSSE joined this group of aspiring travelers with the understanding that ISIL was a designated foreign terrorist organization that engaged in terrorism and terrorist activity. The defendant participated in several meetings throughout 2014 in which he and his co-conspirators discussed traveling to Syria to join ISIL, including how they would pay for such travel, what routes they could take from Minnesota to Syria to best elude law enforcement, and the feasibility of using fraudulent travel documents to travel to Syria.

As admitted by the defendant in his guilty plea, by June 2014, MUSSE knew that co-conspirator Abdi Nur had successfully traveled to Syria and that co-conspirator Abdullahi Yusuf had attempted to travel to Syria but had been stopped by law enforcement at the Minneapolis/St. Paul International Airport. Nevertheless, MUSSE continued to make preparations to travel to Syria to join ISIL. Between October 20, 2014, and November 6, 2014, MUSSE made five cash withdrawals from his federal financial aid account totaling $2,400. He deposited those funds in a personal checking account that he opened on November 3, 2014. He later used those funds to purchase a bus ticket from Minneapolis to New York City.

As admitted by the defendant in his guilty plea, on November 6, 2014, MUSSE and co-conspirators MOHAMED FARAH, HAMZA AHMED, and ZACHARIA ABDURAHMAN purchased bus tickets from Minneapolis to New York City, where they met at John F. Kennedy International Airport (JFK). While at JFK, MUSSE purchased a round-trip ticket to Athens, Greece, which he planned to use as a transit point from which to travel to Syria. MUSSE knew that ABDURAHMAN purchased a ticket on the same flight for the same purpose. After being prevented by federal agents from boarding his flight, MUSSE lied to the agents about the true nature of his travel.

As admitted by the defendant in his guilty plea, after their failed November 2014 attempt to fly overseas, MUSSE and co-conspirators MOHAMED FARAH, ABDURAHMAN, and AHMED met to discuss and coordinate false responses to anticipated law enforcement questions in an effort to conceal their intention to travel to Syria to join ISIL.

As admitted by the defendant in his guilty plea, he continued to meet with his co-conspirators throughout the winter and spring of 2015 to discuss and plan another attempt to travel to Syria to join ISIL. As a result of some of those meetings, MUSSE willingly agreed to participate in a scheme to obtain false passports, travel from Minnesota to Mexico, and fly overseas to join ISIL using those false passports. On April 6, 2015, MUSSE provided a passport photo of himself to a co-conspirator for the purpose of creating a fake passport. Unbeknownst to the defendant, the individual was a cooperating human source (CHS). When MUSSE’s family learned of his plan to travel, MUSSE requested the return of the photograph from the CHS. However, MUSSE admits that he did not withdraw from the conspiracy to provide material support to ISIL when he sought return of the passport photo. Rather, MUSSE was attempting to preserve the viability of his and his co-conspirators’ future travel to Syria.

This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force.

This case is being prosecuted by Assistant United States Attorneys Andrew R. Winter and John Docherty with assistance provided by the National Security Division's Counterterrorism Section.

 

Defendant Information:                                                                                                                   

HANAD MUSTOFE MUSSE, 19

Minneapolis, Minn.

Convicted:

• Conspiracy to Provide Material Support to a Designated Foreign Terrorist Organization (the Islamic State of Iraq and the Levant), 1 count

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the sentencing of BARTOLOMEA JOSEPH MONTANARI, 57, formerly of Bayport, Minn., to 78 months of imprisonment for tax evasion and fraud.

On May 21, 2014, MONTANARI was indicted with one count of Evasion of Payment of Taxes, one count of Mail Fraud, and one count of Wire Fraud. On November 25, 2014, following a 6-day trial, a federal jury found MONTANARI guilty on all counts.  On September 9, 2015, U.S. District Judge Ann D. Montgomery sentenced MONTANARI to 78 months, or 6 ½ years, of imprisonment.  Judge Montgomery further ordered MONTANARI to pay mandatory restitution of $100,000 and, additionally, to pay more than $1.5 million as a special assessment for the taxes, interest, and penalties owed.

The evidence presented at trial proved that from 2009 until January 2012, MONTANARI willfully evaded the payment of employment and excise taxes owed by him and the three businesses he controlled: St. Croix Development, Emlyn Coal Processing, and Montie’s Resources.  One of the ways MONTANARI avoided paying taxes was by transferring over $1.1 million into a bank account in the name of Bella Luca Properties LLC (“Bella Luca”), a shell company with no legitimate business purpose but used by MONTANARI to pay personal expenses. MONTANARI evaded payment of more than $700,000 in taxes and to the federal government.

In December 2009, when the IRS attempted to collect taxes and TFRPs, MONTANARI filed a fraudulent financial statement making numerous misrepresentations to the IRS to avoid paying the taxes he owed. For example, he failed to disclose multiple personal vehicles that he owned and he denied the existence of the Bella Luca bank account, which he was using to receive monthly compensation of $50,000 from two of his companies. MONTANARI also falsely claimed to be living in Bayport, Minnesota, when, in truth, he had already moved into a $1.4 million house he was purchasing in Knoxville, Tennessee.

In addition, as part of a fraud scheme, MONTANARI lied about the sale price of a Caterpillar bulldozer that he needed to purchase for one of his companies.  MONTANARI submitted a falsified invoice to the dozer financing company, which issued a check for the dozer for $100,000 more than the true purchase price.  MONTANARI kept the extra $100,000 and used it as a down payment for his house in Tennessee.

“Business owners have a responsibility to pay excise taxes, and turn over their employees’ employment taxes withheld from their paychecks, to the Internal Revenue Service,” said Special Agent in Charge Shea Jones of the IRS Criminal Investigation.  “This sentence should send a clear message; schemes to evade the payment of taxes are a violation of the Federal Tax Laws and the consequences of such schemes can and will result in significant jail time.”

“Montanari not only evaded payment of taxes and defrauded his business partner, but he repeatedly lied to IRS investigators, pleading poor while living an extravagant lifestyle,” said Assistant United States Attorney Melinda A. Williams.  “Today’s sentence sends a strong message to those who would try to cheat the government that this behavior will not be tolerated.”

In sentencing MONTANARI, Judge Montgomery noted that the defendant used the money he stole to finance an “incredibly flamboyant lifestyle,” that this was “not a single error of judgment,” and that MONTANARI had “many chances” to correct his behavior, but did not.  Therefore, Judge Montgomery said she focused her sentence on “what will get the message across.”

This case is the result of an investigation by the Internal Revenue Service-Criminal Investigation Division, the U.S. Postal Inspection Service, and the Minnesota Financial Crimes Task Force.

Assistant U.S. Attorney Melinda A. Williams prosecuted this case.

 

Defendant Information:

BARTOLOMEA JOSEPH MONTANARI, 57

Knoxville, Tenn.

Convicted:

• Evasion of Payment of Taxes, 1 count
• Mail Fraud, 1 count
• Wire Fraud, 1 count

Sentenced:

• 78 months in federal prison
• $1.5 million special assessment

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

United States Attorney Andrew M. Luger today announced the guilty plea of DEXI ZHENG, 33, to filing a false federal income tax return. ZHENG was charged on July 6, 2015, by felony information, with one count of filing a false individual tax return. He pleaded guilty on August 21, 2015, before U.S. District Judge Ann D. Montgomery in U.S. District Court in Minneapolis, Minn. A sentencing date has not yet been determined.

“Individuals who corruptly violate the tax law to further their business interests and intentionally falsify their tax returns undermine public confidence in our tax system and unfairly disadvantage businesses that play by the rules,” stated Special Agent in Charge Shea Jones of the IRS Criminal Investigation Division.  “The IRS Criminal Investigation Division, together with the U.S. Attorney’s Office, will investigate and prosecute those who violate our tax system.”

According to his guilty plea and documents filed in court, from at least 2009 to 2013, ZHENG was the owner of two restaurants located in St. Michael and Big Lake, Minn. As owner of the restaurants, the defendant was responsible for reporting the profit or loss from the two restaurants on his federal individual income tax returns.

According to his guilty plea and documents filed in court, from at least 2009 to 2013, ZHENG avoided paying taxes on the full amount of the restaurants’ revenue in at least two ways. First, ZHENG intentionally failed to deposit any of the cash receipts into the restaurants’ bank accounts and failed to report the restaurants’ cash receipts on his Schedule C. Second, ZHENG recruited his father, G.Z., to act as a nominee and include the profits from the St. Michael restaurant on G.Z.’s individual income tax returns even though he was not the actual owner of the restaurant. In doing so, ZHENG caused G.Z. to exclude the St. Michael restaurant’s cash receipts from G.Z’s Schedule C. The total loss caused by ZHENG is approximately $420,000.

ZHENG faces up to three years in prison.

This case is the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.

This case is being prosecuted by Assistant U.S. Attorney Kimberly A. Svendsen.

 

Defendant Information:

DEXI ZHENG, 33

St. Michael, Minn.

Convicted:

• Filing a False Individual Tax Return, 1 count

 

 

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Today in Minneapolis, more than 1,000 law enforcement, public health officials, health care professionals, attorneys, drug court representatives, medical students, state, tribal and local government staff, community leaders, recovering addicts and their families from across Minnesota are meeting to address the pain pill problem. The Pain.Pill.Problem. conference brings together experts from the medical, public health and law enforcement fields to look at all sides of opioid abuse and ultimately develop solutions to the problem.

The conference consists of six panels on the following topics:

• The Impact of Opioid Addiction
• Prescribing & Pain Culture
• Pharmacy & Distribution
• Law Enforcement
• Opioid Treatment
• Recovery, Prevention & the Role of Community

Conferees will also hear from speakers on these important issues, including Minnesota Governor Mark Dayton, United States Senator Amy Klobuchar, United States Congressman Tom Emmer, The Honorable Mary Bono, University of Minnesota President Eric Kaler, Dick Beardsley, and others.

“Each case of opioid diversion and addiction represents lives ruined, careers tossed aside and tragic collateral consequences,” said U.S. Attorney Andrew M. Luger. “Doctors, pharmacists, political leaders, legislators, regulators, and civic leaders must address this problem without finger pointing or blame. We need to work together to come up with solutions and that is what the Pain.Pill.Problem. conference is all about. We owe it to our kids, we owe it to our neighbors and we owe it to each other.”

“Narcotic painkillers are being over-prescribed in Minnesota, leading to addiction, abuse and serious consequences. In the last decade, overdose deaths have more than doubled. Painkillers now cause more deaths than heroin and cocaine combined.  We need to have a conversation as a society about how we can treat pain in ways that restores function and this conference is a step in the right direction,” said Minnesota Department of Human Services Commissioner Lucinda Jesson.

“Prescription drug abuse has reached crisis levels, and we should leave no stone unturned in our efforts to reverse this deadly trend,” said United States Senator Amy Klobuchar. “I was proud to participate in today’s critical summit on developing new tools and sharing best practices to help fight this devastating epidemic. I will continue to work with all those who share my commitment to combatting prescription drug abuse on behalf of Minnesota families.”

“The sobering truth is more Minnesotan’s are dying from prescription drugs than virtually all other drugs combined,” said Drug Enforcement Administration Assistant Special Agent in Charge Dan Moren. “The source of these pills is not a foreign based drug cartel. The responsibility of reversing this deadly trend rests with our domestic law enforcement, medical/health care, pharmaceutical, and addiction treatment communities changing the way they do business – it starts by learning the facts at the Pain.Pill.Problem. Summit. The public is reminded to properly dispose of all unused and/or expired prescription drugs at the nearest collection site – this service is free and anonymous. For more information, visit www.DEA.gov.”

“Minnesota is facing the same crisis that the rest of the country is,” said the Honorable Mary Bono. “Opioid misuse, and now heroin use, have overtaken our communities like a plague. I applaud the organizers and supporters of the Pain.Pill.Problem. event and thank them for stepping up to address the crisis. Countless lives hang in the balance.”

“Too many people are dying every day across Minnesota from opioid overdose. Those deaths are preventable. I urge every family and community leader to learn what they can do to educate our youth and to take proactive steps to prevent addiction and overdose,” said Hennepin County Sheriff Rich Stanek. “As Sheriff of Hennepin County, I am proud of the partnerships among local, state, federal, and tribal law enforcement agencies to dismantle criminal drug operations and promote prevention.”

“For Minnesota to make progress on the issue of opioids it will require collaboration and engagement by all the stakeholders,” said Dr. W. Michael Hooten, a pain specialist and anesthesiologist at Mayo Clinic. “This conference offered a convening opportunity and I’m optimistic that we can take our learnings and move forward together.”

“This gathering today proves we’re all in this together,” said Nick Motu, Vice President of the Hazelden Betty Ford Institute for Recovery Advocacy. “We’ve made addressing the opioid crisis a bedrock of the advocacy efforts at our organization, and by coming together with others around solutions like we did today, we can make real progress against this epidemic.”

“There are no simple solutions for opiate addiction. To make a meaningful difference, we will need to engage a broad-based coalition,” said Brooks Jackson, MD, dean of the Medical School and vice president of Health Sciences at the University of Minnesota. “This conference is a great first step. We look forward to continuing this work going forward, addressing broader issues like health policy as well as day-to-day issues around care delivery and treatment of addiction.”

For more information, please visit: www.painpillproblem.com

 

 

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The United States Attorney’s Office for the District of Minnesota announced the indictment of DAVID BLAINE WELLIVER, 55, for defrauding investors in the Dblaine Fund, a mutual fund for which WELLIVER acted as investment adviser, of at least $1.2 million. The defendant is scheduled to make an initial appearance on September 3, 2015, in U.S. District Court in St. Paul, Minn.

According to the indictment, throughout most of 2010, the Dblaine Fund had only a small number of individual investors. In March 2010, in order to increase the Dblaine Fund’s net assets, WELLIVER entered into an agreement in which, in exchange for a payment of approximately $100,000 to another investment adviser, the Dblaine Fund would acquire the assets of two other mutual funds, the Bryce Capital Growth Fund and the Bryce Capital Value Fund (Bryce Funds).

According to the indictment, because WELLIVER’s investment advisory business had never generated substantial revenues, it lacked the capital to finance the merger between the Dblaine Fund and the Bryce Funds. As of June 30, 2010, WELLIVER’s investment advisory company, Dblaine Capital, had less than $200 in liquid assets. During the same time period, WELLIVER had less than $2,000 in his personal bank accounts, and WELLIVER personally owed millions of dollars in civil judgments, federal income taxes, and other debts. Through his company Dblaine Capital, WELLIVER borrowed money from Lazy Deuce Capital Company, LLC (Lazy Deuce), a limited liability company based in Burnsville, Minn., to finance the merger between the Dblaine Fund and the Bryce Funds. On or about December 8, 2010, WELLIVER used funds borrowed from Lazy Deuce to make a $95,000 payment to the Bryce Funds’ investment adviser, and thereafter the merger was completed. As a result of the merger, the Dblaine Fund’s assets under management increased from approximately $500,000 to over $9 million.

According to the indictment, as part of the scheme to defraud investors in the Dblaine Fund, WELLIVER, in 27 separate transactions between October 2010 and May 2011, borrowed a total of $4 million from Lazy Deuce. Aside from the $95,000 payment to acquire the assets of the Bryce Funds, WELLIVER did not use any of the other proceeds of the Lazy Deuce loans to acquire mutual funds as he had represented to Lazy Deuce. Instead, WELLIVER diverted over $500,000 in proceeds from the Lazy Deuce loans to his own personal use, including for landscaping and interior decorating at his personal residence, to purchase land adjacent to his personal residence, to buy a personal vehicle, and to pay for his son’s college tuition.

According to the indictment, in exchange for Lazy Deuce’s agreement to lend funds to Dblaine Capital, WELLIVER agreed to use his position as investment adviser to the Dblaine Fund to cause Dblaine Fund investors’ money to be invested back into Lazy Deuce. In exchange for Lazy Deuce’s agreement to lend funds to Dblaine Capital, WELLIVER agreed to invest money from the Dblaine Fund back in Lazy Deuce. However, in order to conceal the nature of this transaction from the Dblaine Fund’s investors, its Board of Trustees, and its other service providers, WELLIVER made these investments into a shell company formed by several Lazy Deuce principals, called Semita Partners LLC (Semita).

According to the indictment and documents filed in court, between December 16, 2010, and April 15, 2011, WELLIVER caused $1.725 million in Dblaine Fund investors’ money to be invested in Semita. At the time WELLIVER made the investments in Semita, he knew that Semita was a shell company formed by principals of Lazy Deuce – the same company from which Dblaine Capital had borrowed money – and that Semita had no operations. On December 31, 2010, in order to meet a series of redemptions in the Dblaine Fund, Welliver liquidated nearly all of the stocks held by the Dblaine Fund. Following this liquidation, the Dblaine Fund’s only holdings consisted of worthless Semita shares and cash held in a money market account.

This case is the result of an investigation conducted by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the Internal Revenue Service – Criminal Investigation.

This case is being prosecuted by Assistant United States Attorneys Kimberly A. Svendsen and Benjamin F. Langner.

 

Defendant Information:

DAVID BLAINE WELLIVER, 55

Buffalo, Minn.

Charges:

• Wire fraud, 5 counts
• Mail fraud, 4 counts
• Money laundering, 5 counts

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

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The charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

United States Attorney Andrew M. Luger today announced the sentencing of JAMES FRANCIS VOLIN, 65, of Inver Grove Heights, to 24 months in prison for hiding income from used car sales from the Internal Revenue Service for two years. VOLIN was indicted on May 21, 2014 and pleaded guilty to Income Tax Evasion on November 18, 2014. He was sentenced on August 13, 2015, before Senior Judge Michael J. Davis in U.S. District Court in Minneapolis, Minn.

“Taxpayers thinking about participating in fraudulent tax schemes, including failing to report all forms of income, should stop in their tracks and simply look at the consequences of taking the next step,” stated Special Agent in Charge Shea Jones of the IRS Criminal Investigation. “To build faith in our nation’s tax system, honest taxpayers need to be reassured that everyone is paying their fair share. Today’s sentencing of Mr. Volin shows how seriously the courts take federal tax crimes.”

According to his guilty plea and documents filed in court, in 2008 VOLIN agreed to pay nearly $100,000 in outstanding taxes to the IRS. VOLIN still owed the taxes in 2012 and 2013 when he was operating an unlicensed and illegal used car dealership which generated substantial income in cash. Instead of paying the back taxes as agreed, VOLIN hid the income. VOLIN admitted that he did not report the cash income or file tax returns and that he put money into cashier’s checks and used bank accounts opened under another’s name and social security number to avoid detection.

This case is the result of an investigation by the Internal Revenue Service – Criminal Investigations and the Minnesota State Patrol Vehicle Crimes Unit.

The case was prosecuted by Assistant United States Attorney Robert Lewis.

 

Defendant Information:        

JAMES FRANCIS VOLIN, 65

Inver Grove Heights, MN

Convicted:

• Income Tax Evasion, 1 count

Sentenced:

• 24 months in prison
• $96,599.76 in restitution

 

 

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United States Attorney Andrew M. Luger today announced the sentencing of MARTEL JAVELL EINFELDT, a/k/a “Peanut,” 26, to 87 months in federal prison, the top of the federal guideline range, for illegally possessing a firearm after having been previously convicted of two felonies in Hennepin County. The defendant, who was indicted on September 16, 2014, entered a guilty plea on January 21, 2015. EINFELDT was sentenced on August 12, 2015, before Judge Susan R. Nelson in U.S. District Court in St. Paul, Minn.

According to the defendant’s guilty plea and documents filed in court, on June 25, 2014, EINFELDT was found in possession of a Smith and Wesson, semi-automatic pistol. EINFELDT is a confirmed member of the 19-Block Dipset gang, whose members individually and collectively have engaged in patterns of violent criminal activity from 2006 until the present. EINFELDT warned law enforcement that members of a rival gang, the Taliban/Y.N.T. gang, would “get theirs,” for killing Tyrone Washington in 2013, the leader of the 19-Block Dipset gang. EINFELDT was previously convicted in Hennepin County for aggravated robbery and simple robbery, both felonies.

Assistant U.S. Attorney David Steinkamp said: “The defendant has personally suffered for being a member of the 19-Block Dipset. He has been shot twice, in the chest and in the face, lost his half-sister to gang violence, and has predicted he will be dead in three years. Hopefully, this lengthy prison sentence will give the defendant the chance to change the course of his life and prevent his prediction from becoming a reality.”

This case is part of a continuing effort by state and federal law enforcement to focus prosecutive resources on violent gang members who terrorize neighborhoods filled with law abiding, hard working citizens. This case was investigated by the Brooklyn Park Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.

Assistant United States Attorney David Steinkamp prosecuted this case.

 

Defendant Information:

MARTEL JAVELL EINFELDT, 26

Brooklyn Park, Minn.

Convicted:

• Felon in Possession of a Firearm, 1 count

Sentenced:

• 87 months in federal prison
• Three years supervised release

 

 

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United States Attorney Andrew M. Luger today announced the guilty plea of ZACHARY LEE MORGENSTERN, 19, to calling in multiple false bomb threats, making harassing text messages, and making “swatting” phone calls, in which he falsely reported hostage situations. MORGENSTERN was arrested in Texas on May 14, 2015, and was transported to Minnesota. He pleaded guilty today before U.S. District Judge Joan N. Ericksen in U.S. District Court in Minneapolis, Minn.

“‘Swatting’ is dangerous to victims and a significant drain on scarce law enforcement resources,” said U.S. Attorney Andrew M. Luger. “This defendant made swatting attacks, bomb threats and threats to shoot students at schools in Minnesota, in an attempt to harass and intimidate. Schools in Marshall were disrupted by these threats and law enforcement was forced to deploy in order to address imagined hostage situations. The FBI and U.S. Attorney’s Office will not allow such threats to go unanswered.”

According to the defendant’s guilty plea and documents filed in court, between October 2014 and May 2015, MORGENSTERN, made a series of threatening communications against a number of different victims in the Marshall, Minnesota area. The defendant, cloaking himself in anonymized email addresses, Twitter handles, and Internet-based phone accounts, made threats to kill a police officer and her family; threats to use explosives to blow up a school; and threats to use guns to shoot up a school. MORGENSTERN also engaged in a series of “swatting” attacks, in which he made hoax phone calls to law enforcement making it appear that there was a violent crime in progress at a residence, when in fact no such crime was taking place. The defendant engaged in these “swatting” calls with the intent that they would result in an emergency police response to the residence, ideally involving a Special Weapons and Tactics (SWAT) team.

According to the defendant’s guilty plea and documents filed in court, one such attack came on October 7, 2014, when MORGENSTERN called the Marshall Police dispatch center and claimed to have taken two people hostage at a residence of H.M., a minor, in Marshall. MORGENSTERN further claimed that he had shot one of the hostages in the knee cap and that he was going to kill both hostages unless he received a duffel bag containing a half a million dollars. The Marshall Police Department determined that call was a hoax.

According to the defendant’s guilty plea and documents filed in court, beginning on January 6, 2015, MORGENSTERN, claiming to be D.R., a 17-year-old from Marshall, made at least three separate bomb threats to Marshall High School. Approximately four hours after the first threat was called in on January 6, MORGENSTERN used the twitter handle @RIURichHomie, to tweet to D.R., “OOPS. NICE BOMB THREAT. TEEHEEEEEEEE :).” MORGENSTERN later sent a tweet to both D.R. and his friend, S.V., in which he claimed responsibility for the bomb threat.

According to the defendant’s guilty plea and documents filed in court, on January 8, 2015, MORGENSTERN twice called the Marshall Police Department dispatcher. During those calls, MORGENSTERN claimed to have taken hostage a father and son in their home in Marshall. The address provided to police was the residence of D.R. Shortly after each call to Marshall Police, MORGENSTERN tweeted D.R. that he was in the process of “swatting” D.R.

According to the defendant’s guilty plea and documents filed in court, on January 9, 2015, MORGENSTERN called the Marshall Police dispatch and, claiming to be D.R., threatened to “shoot up” Marshall High School in 30 minutes and kill everybody. MORGENSTERN then tweeted from the account, @RIURichHomie that D.R. was going to shoot up a school in 10 minutes. On January 11, 2015, an email was sent to the Superintendent of the Marshall Public Schools, which had purportedly been sent by D.R. The sender claimed to be D.R. and that D.R. and had planted a bomb in at a Marshall, Minn., school that would detonate at 10:00 a.m. the following day. The sender also claimed that he/she would arrive at a different Marshall school at the same time and shoot students and faculty members.

According to the defendant’s guilty plea and documents filed in court, MORGENSTERN engaged in additional threats, harassment, and swatting attacks against individuals in other states. For example, on or about December 24, 2014, the defendant called the Amelia, Ohio Police dispatch center and claimed to be a boy hiding in the closet while a home invasion was in progress. He falsely stated that he was calling from a residence in Amelia, and that three men broke into his house and shot his mother. On or about February 10, 2015, the defendant contacted the Amesbury, Massachusetts Police dispatch center and claimed to be a boy hiding in his closet at an address that was the residence of G.Q, a minor. He falsely stated that four black men had broken into his residence and shot his mother. The call resulted in an armed police entry into the residence, after which police concluded the call was a hoax.

“The multiple calls to law enforcement and the Marshall High School spread fear and taxed the resources of the Police Department and the school,” said Marshall Police Chief Rob Yant. “Even after the first couple of threats, when it appeared that they were being done as a hoax, we had to take them seriously because what if we hadn’t and they turned out to be real? The Internet has made us vulnerable to these types of threats, even when the perpetrator turns out to be halfway across the country, and it has also made it easier for people making the threats to conceal their location and identity. Local police departments do not have the time or the expertise to investigate these cases. That is why we are so grateful for the assistance of the FBI and the US Attorney’s Office in locating and bringing the perpetrator to justice in this case.”

This case is the result of an investigation conducted by the Federal Bureau of Investigation and the Marshall Police Department.

This case is being prosecuted by the United States Attorney’s Office for the District of Minnesota.

Defendant Information:

ZACHARY LEE MORGENSTERN, 19
Cypress, Tex.

Convicted:

• Threats to kill, 1 count

United States Attorney Andrew M. Luger today announced the sentencing of MING GUO, 46, owner of two Twin Cities restaurants, both named Hibachi Grill and Supreme Buffet, and BIJIAN WENG, a/k/a “Wilson,” 28, manager of the restaurants, to federal prison sentences for employing unlawful aliens. GUO and WENG were charged on January 26, 2015, with one count each of Knowingly Hiring Ten or More Unlawful Aliens. GUO and WENG pleaded guilty on March 20, 2015, and were sentenced yesterday by U.S. District Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn.

“Hiring illegal aliens is not a victimless crime. It gives an unfair advantage to a business, forces competitors out of business, and results in lost tax revenue for the community,” said Acting Special Agent in Charge, William Lowder of HSI St. Paul. “Harboring illegal aliens is a very real crime with very real victims. HSI will remain vigilant in protecting American businesses and keeping the playing field level. ”

“These defendants created a successful restaurant business on the backs of undocumented workers,” said Assistant U.S. Attorney Julie E. Allyn. “They forced the victims to work 12-hour shifts, six days per week, by housing them and isolating them without the means and access to build a life. Guo and Weng did not simply hire illegal aliens – they took sustained steps to harbor and transport these workers in violation of U.S. law.”

According to the defendants’ guilty pleas and documents filed in court, from September 30, 2013 through September 30, 2014, GUO and WENG knowingly hired and employed at least 17 individuals who were not authorized to be employed or lawfully admitted for permanent residence in the United States. On September 30, 2014, HSI agents executed search warrants at the restaurants in Spring Lake Park and West St. Paul, Minnesota. They identified 17 undocumented workers working in the restaurants.

According to the defendants’ guilty pleas and documents filed in court, GUO and WENG were aware that the employees were not authorized to work in the United States. Moreover, the defendants did not ask the employees to fill out paperwork, including I-9 Employment Eligibility Verification forms. GUO and WENG also failed to report the unauthorized workers to the Minnesota Department of Economic Development. The employees were paid in cash “off the books.”

According to the defendants’ guilty pleas and documents filed in court, in addition to hiring illegal aliens, GUO and WENG took additional sustained steps to harbor and transport the victims. The defendants housed the victims and transported them to and from work each day. With no cars and limited family (if any) nearby, these employees were left with no choice but working at the restaurants. This allowed the defendants to profit by exploiting and using the employees to work endless hours six days each week.

This case is the result of an investigation conducted by Homeland Security Investigations.

Assistant U.S. Attorneys Julie E. Allyn and Laura M. Provinzino are prosecuting this case.

 

Defendant Information:

BIJIAN WENG, a/k/a “Wilson,” 28

Spring Lake Park, Minn.

Convicted:

• Knowingly Hiring Ten or More Unlawful Aliens, 1 count

Sentenced:

• Six months in prison
• Six months location monitoring
• Two years supervised release
• 100 hours of community service
• $304,827.75 money judgment and criminal fine

MING GUO, 46

North Miami Beach, Fla.

Convicted:

• Knowingly Hiring Ten or More Unlawful Aliens, 1 count

Sentenced:

• Five months in prison
• Seven months location monitoring
• Two years supervised release
• 50 hours of community service
• $304,827.75 money judgment and criminal fine

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the sentencing of KHADRA ABDISAFAD HIRSI, 47, to one year and one day in federal prison for stealing money in the form of child care subsidies from the U.S. Department of Health and Human Services and the State of Minnesota. HIRSI was charged on January 23, 2015, and pleaded guilty on February 4, 2015, to one count of theft of public money. The defendant was sentenced today before Judge Donovan W. Frank in U.S. District Court in St. Paul, Minn.

According to her guilty plea and documents filed in court, HIRSI was the director and co-owner of Ace DayCare Center, Inc. (Ace DayCare) in Eden Prairie, Minn. Many of the families for whom Ace DayCare provided childcare services participated in the Child Care Assistance Program, which provides low-income families with childcare assistance. HIRSI was responsible for submitting truthful and accurate billing forms for childcare services provided by Ace DayCare to families participating in the Child Care Assistance Program. Under the Child Care Assistance Program, child-daycare providers submit billing forms for reimbursement directly to the counties where qualifying families reside.

According to documents filed in court, from at least November 2011 through May 2013, HIRSI knowingly submitted Child Care Assistance Program billing forms that falsely inflated the number of children who received childcare services provided by Ace DayCare. As a result, HIRSI defrauded the U.S. Department of Health and Human Services and the State of Minnesota out of $300,000.

“When people steal from this program, children are deprived of quality child care and all Minnesotans suffer,” said Jerry Kerber, Minnesota Department of Human Services inspector general. “The sentence imposed today recognizes the seriousness of this crime and should deter others from committing fraud against this important public program. DHS is grateful for the cooperation and hard work of the many agencies in this case and we will continue to work together to aggressively target fraud in public programs.”

This case resulted from an investigation conducted by the Federal Bureau of Investigation and the U.S. Department of Health and Human Services – Office of Inspector General.

U.S. Attorney Luger thanked the Minnesota Department of Human Services for their assistance.

This case was prosecuted by Assistant U.S. Attorney John E. Kokkinen.

 

Defendant Information:

KHADRA ABDISAFAD HIRSI, 47

Eden Prairie, Minn.

Convicted:

• Theft of Public Money, 1 count

Sentenced:

• 1 year and 1 day in prison
• Two years supervised release
• $300,000 in restitution

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the sentencing of TAMI MAE MAY, 56, to two years in federal prison for failing to pay federal taxes for more than seven years. MAY pleaded guilty on June 9, 2014, to one count of obstruction of due administration of Internal Revenue laws. MAY was sentenced on August 4, 2015, before Senior Judge David S. Doty in U.S. District Court in Minneapolis, Minn.

According to the defendant’s guilty plea and documents filed in court, from 1998 through 2004, MAY failed to file any income tax returns for the excavating business she ran with her husband, despite that fact that the business earned substantial income during that time. When notified by the IRS in April 2005 that the business owed tax debt, penalties and interest, MAY embarked on an eight-year campaign of frivolous filings, in an effort to obstruct the administration of Internal Revenue laws.

According to the defendant’s guilty plea and documents filed in court, MAY filed a host of fake documents with the IRS, including a “zero income” tax return, Forms 1099-OID falsely claiming that her husband had made payments to various IRS Revenue Officers, falsely claiming that the Mays or their business had received “original issue discounts” and had “federal tax withheld” by various banks and credit card companies, and forms claiming that the Mays were not United States Citizens, but instead were permanent residents of the “Kingdom of Heaven.”

According to the defendant’s guilty plea and documents filed in court, MAY also made nonsensical tax-defier-scheme-related statements to the IRS, including that her social security number was her “corporate fiction’s” social security number, that her family’s business was a foreign trust of which she was the trustee, and that there is no such thing as money.

This case is the result of an investigation conducted by the Internal Revenue Service-Criminal Investigations.

Assistant U.S. Attorney Kimberly A. Svendsen prosecuted the case.

 

Defendant Information:

TAMI MAE MAY, 56

Anoka, Minn.

Convicted:

• Obstruction of due administration of Internal Revenue laws, 1 count

Sentenced:

• 2 years in prison
• 1 year supervised release
• $192,495 in restitution

 

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United States Attorney Andrew M. Luger, ATF Special Agent in Charge for the St. Paul Field Division James C. Modzelewski, Minneapolis Police Chief Janeé Harteau and Hennepin County Attorney Michael O. Freeman today announced a federal indictment charging seven members of the 10z and 20z street gangs with crimes related to a multi-year gang war with their rivals, which included a shooting in August 2014 outside of the Hennepin County Medical Center. The defendants include both leaders and other members of the 10z and 20z. They are charged with conspiracy to possess firearms in the furtherance of a drug trafficking conspiracy, conspiracy to distribute controlled substances, possession with intent to distribute heroin and crack cocaine, and illegal possession of firearms and ammunition. The defendants are expected to make initial appearances today in U.S. District Court in St. Paul, Minn.

“Today’s indictment marks the sixth violent street gang that this office has indicted since 2014,” said U.S. Attorney Luger. “Street gangs trafficking heroin and other drugs in Minnesota are engaged in violence against one another and endangering the communities in which innocent civilians live and work. We are using every tool at our disposal to investigate and prosecute the members of these gangs who use firearms to protect their illegal drug trade and attempt to expand their areas of operations. Working with both federal and local law enforcement, my office remains focused on violent street gangs and the harm they cause to our communities. We will continue to go neighborhood to neighborhood to stop the gang wars that so often accompany drug trafficking.”

Minneapolis Police Chief Janeé Harteau said: “This indictment is a true testament to the partnerships and hard work of the MPD Weapons Unit, MPD’s Third Precinct Community Response Team, ATF and the Minnesota Department of Corrections. Our hope is this sends a strong message to those who participate in gang violence that they will be held accountable for putting innocent lives in danger. Over the course of the MPD investigation, more than two dozen guns have been linked to this gang, which has been responsible for 50 different shooting incidents in Minneapolis in the past year.”

Bureau of Alcohol, Tobacco, Firearms and Explosives, St. Paul Field Division Special Agent in Charge James Modzelewski said: “ATF’s core mission, enforcing laws that prohibit misuse of firearms, have placed ATF in the center of these violent gang investigations along with our local law enforcement partner, the Minneapolis Police Department. I am confident that this investigation will significantly impact the flow of illegal firearms and criminal use of those firearms on the streets.”

Hennepin County Attorney Mike Freeman said: “We are thankful the U. S. Attorney’s Office has indicted these extremely dangerous men. We have been prosecuting some of the same men, such as Percy Lacey who took part in a wild shootout by the Hennepin County Medical Center last summer. Bringing a coordinated state and federal prosecution to break up these gangs will be a big help in our mutual goal of reducing gun violence in Minneapolis.”

According to the indictment and documents filed in court, between at least January 2013 and July 2015, the defendants were active members of two closely associated street gangs known as the 10z and the 20z. The gangs operated in South Minneapolis, primarily between Franklin Avenue, and Lake Street, and I-35W and Minnehaha Avenue. Their primary purpose was to make money for the gang members through the sale of illegal drugs, including crack cocaine, heroin, and marijuana. As part of their drug trafficking operation, members of the gangs routinely engaged in gun violence with rival gangs. The purpose of this violence was to protect drug dealing territory controlled by the 10z and 20z, to protect individual drug distributors from rival gang violence, to attack and seize drug dealing territory controlled by rival gangs, and to attack and rob drug distributors associated with rival gangs.

According to the indictment and documents filed in court, the 10z and 20z were involved in a gang war with their primary rival gangs, the Bloods and the Bogus Boys. The gang war was very violent and resulted in shootings of gang members on both sides, some of which caused the death of gang members. Virtually all of these shootings were the product of disputes over territory, robberies of rival drug dealers, or retaliatory violence.

According to the indictment and documents filed in court, the defendants were involved in at least five shootings between August 19, 2014, and September 23, 2014. On August 19 2014, PERCY LACEY, JR., and other members of the 10z and 20z shot and wounded members of the Bloods near the corner of 37th Street East and Chicago Ave S. in the Powderhorn neighborhood of South Minneapolis. LACEY, JR., and his co-conspirators used a Masterpiece 9mm semi-automatic pistol to carry out the shooting. Two days later, CLARENCE DICKENS, JR., engaged in a drive-by shooting targeting a member of the Bloods outside of a McDonald’s at the corner of 2nd Avenue S and E. Lake Street.

According to the indictment and documents filed in court, on August 26, 2014, ANDREW PETERSON and LACEY JR., along with other members of the 10z and 20z, staged a coordinated attack on members of the Bloods. Members of the Bloods were at the Hennepin County Medical Center visiting an injured member of their gang who had been shot earlier that day by members of the 10z during a drive-by shooting. PETERSON stood outside the hospital and attempting to draw Bloods members outside. Once outside of the hospital, LACEY, JR., fired multiple gun shots at the Bloods from across the street.

According to the indictment and documents filed in court, on September 23, 2014, ANTHONY PIERRE DOSS was carrying the same Masterpiece 9mm used by LACEY, JR., during the August 19, 2014, shooting. While in possession of the Masterpiece, DOSS and other members of the 10z were shot at and wounded outside of a Moto Mart gas station at 3301 Hiawatha Avenue in South Minneapolis.

The indictment is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Minneapolis Police Department.

This case is being prosecuted by Assistant U.S. Attorney Thomas Calhoun-Lopez.

 

Defendant Information:

DANIEL ALFRED ADAMS, a/k/a “Funk,” 29

Minneapolis, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Possession with intent to distribute heroin, 1 count
• Possession of a firearm in furtherance of a drug trafficking crime, 1 count
• Felon in possession of a firearm, 2 counts

ANDREW INDELICATO PETERSON, a/k/a “Boo Boo,” 25

St. Louis Park, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Felon in possession of ammunition, 1 count

PERCY MINIFER LACEY, JR., a/k/a “P3,” 22

Richfield, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Felon in possession of ammunition, 1 count

ANTHONY PIERRE DOSS, a/k/a “Two Tone,” a/k/a “Tony,” 24

Brooklyn Park, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Felon in possession of a firearm, 2 counts

THOMAS DUPREE BENNETT, a/k/a “Deandre Clay,” a/k/a “Trigga,” 27

Minneapolis, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Felon in possession of ammunition, 1 count

PAUL ANTONIO EARLY, a/k/a “Stamps,” a/k/a, “Man Man,” 23

Minneapolis, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Possession with intent to distribute cocaine base, 1 count

CLARENCE JAMES DICKENS, JR., a/k/a “Claro,” a/k/a, “Sneaky,” 24

Roseville, Minn.

Charges:

• Conspiracy to possess firearms in furtherance of a drug trafficking crime, 1 count
• Conspiracy to distribute controlled substances, 1 count
• Felon in possession of a firearm, 1 count

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

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The charges contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

WASHINGTON – A Minnesota man who worked at Kadena Air Base in Okinawa, Japan, was sentenced today to 60 months for sexual assault.  Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Andrew M. Luger of the District of Minnesota, Acting Executive Assistant Director Charles Warmuth of the Naval Criminal Investigative Service’s (NCIS) Pacific Operations and Special Agent in Charge Richard T. Thronton of the FBI’s Minneapolis Field Office made the announcement. 

Ricky Isiah Sherwood, 19, pleaded guilty on Nov. 14, 2014, to sexual assault.  U.S. District Judge Ann D. Montgomery imposed today’s sentence.

In connection with his guilty plea, Sherwood admitted to sexually assaulting a heavily intoxicated minor in a residence on base on Feb. 11, 2014, and to filming parts of the assault using his cellular phone.  At the time of the assault, Sherwood was an employee of Kadena Air Base and a dependent of a member of the U.S. Military.  The Military Extraterritorial Jurisdiction Act gives federal courts jurisdiction over felonies committed abroad by certain persons employed by or accompanying the U.S. Military.

This case was investigated by NCIS and FBI.  This case is being prosecuted by Trial Attorney Ann Marie Ursini of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Katharine Buzicky of the District of Minnesota.

 

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United States Attorney Andrew M. Luger today announced the guilty plea of TIMOTHY PAUL OWENS, 55, for obstructing an examination by the Board of Governors of the Federal Reserve (Federal Reserve Board). In addition to its role in setting national monetary policy and in conjunction with the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board is responsible for supervising and regulating banking institutions to ensure the safety and soundness of the nation’s financial system. OWENS pleaded guilty today to one count of obstruction of an examination of a financial institution. He entered the plea before Judge Ann Montgomery in U.S. District Court in Minneapolis, Minn.

“Financial and banking professionals have a responsibility to respond truthfully to regulatory inquiries,” said U.S. Attorney Luger. “This defendant violated his responsibility and broke the law. Federal regulators and prosecutors are working together closely to uncover and prosecute the kind of obstructive behavior exhibited by Mr. Owens.”

According to the defendant’s guilty plea and documents filed in court, OWENS served as CEO and Chairman of Voyager Bank (Voyager) and the President and CEO of the bank’s holding company, Voyager Financial Services Corporation (VFSC).  In June 2009 the Federal Reserve Board conducted an examination of VFSC, focusing specifically on loans made to VFSC insiders, including OWENS. The Federal Reserve Board examiners sought to, among other things, determine the quality of VFSC’s internal controls relating to loans to insiders and the credit risk presented by the loans.  According to the information known to the examiners at the time, VFSC had issued three loans to OWENS.

According to the defendant’s guilty plea and documents filed in court, after the examination the Federal Reserve Board on July 7, 2009 demanded in writing that VFSC review OWENS’ loans and submit documentation showing that the loans to OWENS had been reviewed by the VFSC board and were consistent with existing bank policies. The Federal Reserve specifically ordered that its letter be presented to the VFSC Board of Directors and discussed at its next meeting. OWENS received the letter personally, but did not disclose it to the VFSC board.  Instead, OWENS alone prepared a response to the Federal Reserve Board.

At the time of the examination, OWENS had four loans with VFSC totaling more than $5 million. According to the defendant’s guilty plea and documents filed in court, however, OWENS’ response to the Federal Reserve was false and misleading, because he only identified the three loans that had been disclosed in the June examination, did not disclose a fourth $1,000,000 loan, and wrote the response as though it had been reviewed and approved by the VFSC Board of Directors and signed by its chairman, when in fact it had not.  The purpose of the misrepresentations, according to OWENS’ guilty plea today, was to portray inaccurately his financial circumstances and ability to repay the loans by, among other things, exaggerating his wealth and concealing his liabilities and thereby cause the Federal Reserve Board to end its examination of VFSC and OWENS’ substantial indebtedness.

This case is the result of an investigation conducted by the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau; the Federal Deposit Insurance Corporation, Office of Inspector General; the Federal Housing Finance Agency, Office of Inspector General; and the Federal Bureau of Investigation.

This case is being prosecuted by Assistant U.S. Attorney Robert Lewis.

 

Defendant Information:

TIMOTHY PAUL OWENS, 55

Wayzata, MN

Convicted:

• Obstructing Examination of a Financial Institution, 1 count

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

United States Attorney Andrew M. Luger today announced the guilty plea of BLAIR A. NELSON, 43, who obtained Hydrocodone, Oxycodone, and other prescription drugs by writing and filling fraudulent prescriptions. NELSON pleaded guilty to obtaining a controlled substance by fraud today before Judge Susan R. Nelson in United States District Court in St. Paul, Minn.

“Prescription drug diversion is an ongoing threat to both public safety and public health,” said U.S. Attorney Luger. “Working closely with colleagues at the Drug Enforcement Administration and in local law enforcement, we are clamping down on prescription drug fraud and abuse.”

According to the defendant’s guilty plea and documents filed in court, beginning in May 2013, NELSON, who was a doctor practicing medicine in Pelican Rapids, Minn., and Fargo, N.D., began writing prescriptions to various pharmacies in Minnesota for opioids including oxycodone, hydrocodone, and amphetamines. NELSON wrote the prescriptions so that they could be filled in the names of members of his family and friends. However, after issuing the prescriptions, NELSON picked up the drugs for his own use.

According to his guilty plea and documents filed in court, between May 2013 and September 2014, NELSON attempted to obtain from Target, Walgreens, and Wal-Mart, at least 1,730 prescription pills for his own use by writing prescriptions in the names of his family members. He continued to write prescriptions even after the State of Minnesota suspended his medical license on October 8, 2013.

This case is the result of an investigation conducted by the Drug Enforcement Administration.

Assistant U.S. Attorney Thomas Calhoun-Lopez is prosecuting the case.

On Tuesday, August 25, 2015, a conference entitled, “Pain.Pill.Problem.” will be held at the University of Minnesota’s Twin Cities Campus, to bring together experts in the fields of public health and law enforcement to define the scope of the opioid abuse problem and develop solutions to move Minnesota forward together. The one-day conference is co-sponsored by the United States Attorney’s Office for the District of Minnesota, the Minnesota Department of Human Services, U.S. Drug Enforcement Administration, Hazelden Betty Ford Institute for Recovery Advocacy, Mayo Clinic, Hennepin County Sheriff’s Office, University of Minnesota, and others. Please visit www.PainPillProblem.com for more information about the event.

 

Defendant Information:                                                                                                                    

BLAIR A. NELSON, 43

Pelican Rapids, Minn.

Convicted:

• Obtaining a controlled substance by fraud, 1 count

 

 

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United States Attorney Andrew M. Luger today announced the sentencing of MATTHEW RICHARD PETERSON, 39, who pleaded guilty to federal charges of fraudulently acquiring pain medication while he was employed as a paramedic. PETERSON was indicted on August 11, 2014, and pleaded guilty on November 7, 2014. He was sentenced today before Senior Judge David S. Doty in U.S. District Court in Minneapolis, Minn.

“This defendant stole opioids to feed his own addiction, leaving vulnerable patients without the medicine they needed,” said U.S. Attorney Luger. “The charges in this case reflect our growing concern about the theft and abuse of opioids. I encourage those with an addiction – particularly caregivers and medical professionals – to seek help so they do not end up facing the type of criminal charges faced by Mr. Peterson.”

“Minnesota paramedic Mathew Peterson abused his position of public trust by providing diluted pain medication to those facing critical health emergencies to fuel his own drug addiction,” said Drug Enforcement Administration (DEA) Assistant Special Agent in Charge Dan Moren.  “Peterson’s reckless behavior not only denied patients relief from pain but also jeopardized their medical condition and potentially exposed them to contaminated medications. This joint investigation between DEA and the Federal Food and Drug Administration, with the assistance of the St. Paul Police Department, has eliminated this diversion of controlled substances and reduced the potential for further public harm.”

“The defendant in this case exhibited a complete disregard for the patients he victimized,” said Special Agent in Charge John J. Redmond of the Food and Drug Administration’s Office of Criminal Investigations, Chicago Field Office. “We will continue our work to ensure that those who tamper with patients’ pain medication for their own purposes are brought to justice. We commend our law enforcement partners for their efforts in this case as well as the U.S. Attorney’s Office for its prosecution of this matter.”

According to his guilty plea and documents filed in court, from August 2013 to November 5, 2013, PETERSON, who was then working as a paramedic for Allina Health, stole morphine and hydromorphone intended for ambulance patients. PETERSON extracted the drugs with a syringe and, in an effort to cover up his crime, replaced the liquid with a saline solution. PETERSON left more than 100 patients at greater risk of infection and pain as a result of his tampering, and only reported himself when co-workers discovered his malfeasance.

According to the defendant’s guilty plea and documents filed in court, on April 4, 2014, after his dismissal from both inpatient and outpatient addiction treatment, PETERSON was discovered hiding under a trailer in a Bloomington fire station where he was attempting to steal and use opioids. When questioned by law enforcement, PETERSON admitted that he accessed the fire station to steal drugs.

This case is the result of an investigation conducted by the U.S. Drug Enforcement Administration, U.S. Food and Drug Administration’s Office of Criminal Investigations, and the St. Paul Police Department.

This case was prosecuted by Assistant U.S. Attorney Richard A. Newberry.

On Tuesday, August 25, 2015, a conference entitled, “Pain.Pill.Problem.” will be held at the University of Minnesota’s Twin Cities Campus, to bring together experts in the fields of public health and law enforcement to define the scope of the opioid abuse problem and develop solutions to move Minnesota forward together. The one-day conference is co-sponsored by the United States Attorney’s Office for the District of Minnesota, the Minnesota Department of Human Services, U.S. Drug Enforcement Administration, Hazelden Betty Ford Institute for Recovery Advocacy, Mayo Clinic, Hennepin County Sheriff’s Office, University of Minnesota, and others. Please contact usamn.outreach@usdoj.gov for more information about the event.

 

Defendant Information:

MATTHEW RICHARD PETERSON, 39

Richfield, Minn.

Convicted:

• Obtaining a controlled substance by fraud, 1 count

Sentenced:

• 3 years of probation, including:
  • Regular drug testing
  • Prohibited from having a job with access to controlled substances

 

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United States Attorney for the District of Minnesota Andrew M. Luger today announced an indictment charging JAMES RYAN FREI, 34, with illegal possession of a firearm. FREI is expected to make an initial appearance on July 16, 2015, before Magistrate Judge Franklin L. Noel in U.S. District Court in Minneapolis, Minn.

According to the indictment and documents filed in both state and federal court, on June 21, 2015, FREI attempted to steal a wireless speaker from a St. Paul Wal-Mart. The defendant was momentarily stopped and questioned by St. Paul Police Officer Michael Tschida as the defendant tried to leave the Wal-Mart. However, FREI pointed a handgun at Officer Tschida’s head before running to a pickup truck outside and recklessly driving away. The defendant led police officers on a high-speed chase, during which he repeatedly pointed a gun at the pursuing squad cars, sped through red lights and drove against traffic on Snelling Avenue. The chase ended when FREI crashed into a parked car and attempted to flee on foot.

According to the indictment and documents filed in both state and federal court, FREI was ineligible to possess firearms in Minnesota because of felony convictions from Oklahoma for robbery with firearms and assault, battery with a dangerous weapon, and escape. FREI also has been convicted in Wisconsin for burglary and escape.

This case is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives.  

This case is being prosecuted by Assistant United States Attorney Jeffrey S. Paulsen.

 

Defendant Information:                                                                                                                    

JAMES RYAN FREI, 34

Tomah, Wis.

Charges:

• Felon in possession of a firearm, 1 count

 

 

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The charges contained in the indictment are merely allegations, and the defendant is presumed innocent unless and until proven guilty.

United States Attorney Andrew M. Luger and Acting Special Agent in Charge of Homeland Security Investigations St. Paul Division William Lowder today announced the conviction of ZDENKO JAKIŠA, 47, for obtaining a Permanent Resident Card (I-551), commonly referred to as a “Green Card,” by materially false claims and statements. JAKIŠA entered his plea today before Judge Susan Richard Nelson in United States District Court in St. Paul, Minn.

According to the defendant’s guilty plea and documents filed in court, JAKIŠA is a Bosnian citizen and lawful permanent resident of the United States living in Minnesota. On April 17, 2014, JAKIŠA possessed a green card that was unlawfully obtained. In response to questions on his legal permanent resident applications, JAKIŠA knowingly denied that he had been arrested, charged, or imprisoned for breaking the law in Bosnia and Herzegovina.

According to the defendant’s guilty plea and documents filed in court, between July 1990 and October 1997, JAKIŠA was charged with at least seven separate crimes in Bosnia and Herzegovina. On July 13, 1990, JAKIŠA was charged and convicted of Violent Behavior. He was charged with Grand Larceny on April 7, 1991, for allegedly stealing a cash register from a café. JAKIŠA was charged and convicted of Causing General Danger in September 1993 for shooting and killing his neighbor through her bedroom window.

According to JAKIŠA’s guilty plea and documents filed in court, he was arrested, charged and convicted of Theft for stealing commercial scales from an outdoor storage area on October 11, 1994. JAKIŠA was convicted of Infliction of Grievous Bodily Damage in February 1997 for seriously wounding another person who was later discovered bloodied in the street. JAKIŠA was convicted of Disturbing Peace & Public Order for attempting to persuade a woman to leave her home by threatening that he would get a firearm, throwing bricks at her home, and by attempting to break through the front door. Less than a week later, JAKIŠA was charged with fighting and stealing a gold necklace from the victim’s neck.

This case is the result of an investigation conducted by Homeland Security Investigations.

Assistant U.S. Attorney from the District of Minnesota Nathan P. Petterson and Trial Attorney Ann Marie Ursini of the Human Rights and Special Prosecutions Section of the Criminal Division, U.S. Department of Justice are prosecuting the case.

 

Defendant Information:                                                                                                                    

ZDENKO JAKIŠA, 47

Forest Lake, Minn.

Convicted:

• Possession of unlawfully obtained documents, 1 count

 

 

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United States Attorney Andrew M. Luger today announced the sentence of DENNIS CHARLES HELMER, a/k/a “Jeff Jones,” a/k/a, “Mr. Diamond,” a/k/a, “Dennis Dimon,” 54, to 150 months in prison for devising an elaborate coin fraud scheme and defrauding dozens of elderly victims of more than $1.3 million. HELMER was indicted on August 5, 2014, and pleaded guilty on September 25, 2014. He was sentenced today before Senior Judge David S. Doty.

According to the defendant’s guilty plea and documents filed in court, HELMER operated Wholesale Assets Worldwide, LLC (WAW) and Best Price International, LLC (BPI), which engaged in appraising, buying, selling, and trading of coins and precious metals. From November 2009 through January 2014, through WAW and BPI, HELMER contacted dozens of victims, many of whom were in their 80s and 90s. He visited potential victims in their homes and persuaded them to entrust to him money, coins, and precious metals, based on false promises. HELMER falsely told victims that his businesses had more than 75 employees and $500 million in annual revenue, and also provided a falsely obtained “Dun & Bradstreet Credibility Review” of his business.

According to the defendant’s guilty plea and documents filed in court, WAW and BPI received over $1.3 million in coins, precious metals, and cash from victims. Instead of fulfilling their orders, HELMER sold many of the coins and used customers’ money and proceeds from those sales to fulfill other orders, make payments to other customers, pay his own personal expenses, and attempt to fund start-up costs for another purported company, Smoke Shack, LLC.

According to the defendant’s guilty plea and documents filed in court, HELMER targeted elderly victims because they were particularly vulnerable. HELMER took note of anything that would make it easier to steal from them. For example, HELMER targeted a 79-year-old stroke victim, an 86-year-old victim who fell asleep during an in-person meeting with HELMER, a 99-year-old victim suffering from dementia, a victim in hospice care, and a legally blind octogenarian.

According to the defendant’s guilty plea and documents filed in court, HELMER used various aliases, including “Jeff Jones,” in an attempt to hide his three prior criminal convictions for similar conduct in both Dakota and Hennepin Counties. In November 2013, when HELMER learned that WAW was under investigation, he moved his coin fraud operation to Florida where he continued to operate his scheme under the newly formed BPI under the aliases, “Mr. Diamond” and “Dennis Dimon.”

This case is the result of an investigation conducted by the United States Postal Inspection Service and the Minnesota Department of Commerce.

Assistant U.S. Attorney Kimberly A. Svendsen prosecuted this case.

 

Defendant Information:

DENNIS CHARLES HELMER, 54

Farmington, Minn.

Convicted:

• Mail Fraud, 1 count

Sentenced:

• 150 months in federal prison
• 3 years supervised release
• $1,329,873.25 restitution

 

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United States Attorney Andrew M. Luger today announced the sentence of TORY EVAN HUGHES, 45, to 71 months in federal prison for stealing more than $700,000 through a gold and coin investment scheme. HUGHES was indicted on August 6, 2014, and pleaded guilty on October 8, 2014. He was sentenced today before United States District Court Judge Richard Kyle.

According to the defendant’s guilty plea and documents filed in court, from August 2009 through September 2010, the defendant owned and operated Reputable Rare Coins, LLC (“RRC”), located in Roseville, Minnesota. HUGHES claimed to buy, sell and trade gold, silver and other coins. To generate business, the defendant made unsolicited phone calls primarily to elderly individuals in an effort to encourage them to purchase or exchange coins at RRC.

According to the defendant’s guilty plea and documents filed in court, HUGHES received more than $600,000 in coins and cash from at least nine victims in Minnesota and elsewhere, including one victim who mailed $50,000 to RRC. However, instead of reimbursing the victims—some of whom had sent him their life’s savings—HUGHES told his customers that he was having ongoing issues with coin suppliers and instead used the victim’s money to fuel his gambling addiction and pay for personal expenses.

According to the defendant’s guilty plea and documents filed in court, in May 2013 HUGHES incorporated a new business, U.S. Collectables, in Gilbert, Arizona. Between May 2013 and May 2014, HUGHES used U.S. Collectables to defraud more than $100,000 from at least six victims who expected to receive money or coins from HUGHES.

“These victims have suffered immeasurably as a result of HUGHES’ callous behavior,” said Assistant U.S. Attorney Karen B. Schommer. “HUGHES lied to them, gave them false hope and gambled away their life’s savings. I hope that the victims find some measure of comfort in today’s sentence.”

This case is the result of an investigation conducted by the United States Postal Inspection Service and the Roseville Police Department.

This case was prosecuted by Assistant U.S. Attorney Karen B. Schommer.

 

Defendant Information:

TORY EVAN HUGHES, 45

Minneapolis, Minn.

Convicted:

• Mail fraud, 1 count

Sentenced

• 71 months in prison
• $753,203.83 in restitution

 

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United States Attorney Andrew M. Luger today announced the sentence of BRIAN TODD GORE a/k/a “Sammy Walker,” 46, to 37 months in federal prison for conspiring to traffic counterfeit Major League Baseball, National Basketball Association, National Football League, National Hockey League and National Collegiate Athletic Association jerseys. GORE was indicted on July 9, 2014, and pleaded guilty on December 9, 2014. He was sentenced today before United States District Court Judge Patrick Schiltz.

According to the defendant’s guilty plea and documents filed in court, from November 2009 through September 2012, GORE ordered counterfeit jerseys from suppliers in China and sold them to various buyers in Minnesota and elsewhere. One such buyer was a co-conspirator, R.M., the owner of AME Sports in Roseville, Minnesota. According to R.M., Gore was R.M.’s primary supplier of counterfeit jerseys, which R.M. sold at his store.

According to the defendant’s guilty plea and documents filed in court, in February 2010, GORE and others from Minnesota traveled to Miami, Fla., to sell fake NFL jerseys at Super Bowl XLIV. They were encountered as part of a law enforcement operation in which GORE and his co-conspirators tried to sell the counterfeit apparel to undercover officers. At the time, officers seized 383 jerseys from GORE, as well as international shipping receipts showing packages sent from China.

GORE was caught again two years later in Minnesota while in possession of more than 2,000 counterfeit jerseys and hats, some of which retailed in authentic form for as much as $300 each. The total potential retail value of the goods GORE counterfeited was at least $320,000.

This case is the result of an investigation conducted by Homeland Security Investigations.

This case was prosecuted by Assistant U.S. Attorney Sarah E. Hudleston.

 

Defendant Information:

BRIAN TODD GORE, 46

Inver Grove Heights, Minn.

Convicted:

• Conspiracy to traffic in counterfeit goods, 1 count

Sentenced:

• 37 months in prison
• 3 years supervised release

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

United States Attorney Andrew M. Luger today announced the sentence of SEAN MEADOWS, 42, to 25 years in federal prison for using his financial planning and asset management firm, Meadows Financial Group (MFG), to operate a long-term Ponzi scheme in which he stole more than $13 million from at least 100 individual victims. MEADOWS was indicted on August 5, 2014, and pleaded guilty on December 11, 2014. He was sentenced today before United States District Court Judge Susan Richard Nelson.

“Sean Meadows systematically destroyed the financial security of more than one hundred working and middle class people, leaving them with no possibility of recovery,” said U.S. Attorney Luger. “Over the past year we have charged more than a dozen individuals for conducting investment fraud schemes that resulted in the loss of tens of millions of dollars from hundreds of victims. Like Meadows, many of these criminals preyed on the most vulnerable victims – working-class retirees seeking to make a little more out of their golden years. It is a priority of my office to put a stop to this kind of malicious financial exploitation. Working together with excellent investigators at the Minnesota Department of Commerce Fraud Bureau, IRS-CID, United States Postal Inspection Service, SEC and FBI, we are focused on catching these types of cases at the earliest stages to prevent the kind of financial catastrophe that Sean Meadows caused to the victims in this case.”

“Sean Meadows pretended to be a trusted investment adviser, but he abused that trust by lying to and stealing from his clients,” said Minnesota Commerce Commissioner Mike Rothman. “Instead of investing his clients’ hard-earned retirement savings, he used their money to bankroll his own extravagant lifestyle. Meadows not only robbed his victims of their lifetime savings. He also robbed them of their peace of mind and their dreams of a secure retirement. The Commerce Department Fraud Bureau put a stop to his crimes and worked closely with federal authorities to bring Meadows to justice.”

"Illegal activity involving the investment industry has brought financial ruin to many Americans” said Special Agent in Charge Shea Jones of the IRS Criminal Investigation St. Paul Field Office. “Today's sentencing of Mr. Meadows reinforces our commitment to identify and prosecute those who prey upon honest, hard-working taxpayers that have taken what has belonged to others for their own personal financial gain.”

According to the defendant’s guilty plea and documents filed in court, MEADOWS operated MFG, through which he sold insurance and investment products to clients in Minnesota, Indiana, Arizona, and elsewhere. From 2007 until April 2014, MEADOWS successfully solicited a total of at least $13 million from more than 100 clients for a purported investment managed by MFG. The defendant falsely told victims that he would use their funds to purchase bonds, real estate, or other legitimate third-party investments.

According to the defendant’s guilty plea and documents filed in court, MEADOWS lured victims into removing funds from their retirement and other savings accounts by promising high rates of returns – up to 10 percent annually – when, in fact, he did not invest their funds and did not have a legitimate means by which to make interest payments. Instead, MEADOWS used funds from new investors to make interest and/or principal repayments to existing investors. For example, as charged in the indictment, on September 26, 2013, MEADOWS made a payment of more than $500,000 to one victim, purportedly paying off a successful investment with MFG. In fact, the payment was actually comprised of newly invested funds from other victims.

According to the defendant’s guilty plea and documents filed in court, MEADOWS used the illicit proceeds of the Ponzi scheme to pay personal expenses, including: making “salary” payments to himself; making payments to his spouse; paying expenses on personal investment properties; paying personal credit card bills; purchasing a vehicle for himself; traveling to Las Vegas; gambling at various casinos and online; and spending more than $135,000 at adult entertainment establishments in Minnesota and Las Vegas.

Among the victims MEADOWS defrauded are senior citizens and the disabled, poor or terminally ill. Victims were left in financial ruin because they lost their financial security, retirement funds, their ability to support their families, and in some cases, their ability to pay for cancer treatments.

According to documents filed in court, as just one example, one 66-year-old victim identified in court papers as “Victim 1,” had approximately $200,000 saved in a MetLife annuity when she met the defendant. MEADOWS convinced her to entrust him with the annuity to invest. In November 2013, Victim 1 was diagnosed with lung cancer and was told she only had 18 months to live. When she asked the defendant to surrender her investment so she could travel, enjoy her remaining time and divide her money amongst her family, Meadows convinced her to instead move most of the money to a high interest bond that was “very liquid.” She wrote a check to MFG for $215,000. An Allianz internal investigator soon called her and asked if she was aware of the surrender penalties she would have to pay. The victim called MEADOWS, who told her to “relax” and avoided her questions by first saying he was recovering from knee surgery and later that he was on vacation in Arizona. Victim 1 asked the defendant for $20,000 to cover her credit card debt, which he claimed he would provide, but the money never arrived. MEADOWS left Victim 1 without the funds to travel, without the funds to seek advanced treatment for cancer and with no money to leave to her family.

This case is the result of an investigation conducted by the Minnesota Department of Commerce, Securities and Exchange Commission, the United States Postal Inspection Service, the Internal Revenue Service – Criminal Investigation, and the FBI.

This case was prosecuted by Assistant U.S. Attorneys Benjamin F. Langner and Melinda A. Williams.

 

Defendant Information:

SEAN MEADOWS, 42

Eden Prairie, Minn.

Convicted:

• Wire Fraud, 7 counts
• Mail Fraud, 3 counts
• Transaction Involving Fraud Proceeds, 1 count

Sentenced

• 25 years in prison
• 3 years supervised release

 

 

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United States Attorney Andrew M. Luger today announced a criminal complaint charging JEFFREY SCOTT EVANS, 51, with traveling from Tennessee to Bloomington, Minnesota, for the purpose of engaging in illicit sexual conduct with a 13-year-old female. EVANS made an initial appearance yesterday in U.S. District Court in St. Paul, Minn., before Magistrate Judge Jeffrey J. Keyes.

According to the criminal complaint and documents filed in court, on June 12, 2015, EVANS used the screen name “taboolooking” on a social media site called “chathour.com,” to initiate a conversation with another user who EVANS believed to be a 13-year-old female. EVANS indicated that he wanted to text and email with her, and if they liked each other he would travel from Tennessee to Minnesota to meet her.

According to the criminal complaint and documents filed in court, later on June 12, 2015, EVANS made a reservation at a hotel in Bloomington, Minn. On June 14, 2014, EVANS asked over text message “Do y really think y can stay with me 3 r 4 days and not get in trouble I hope u can.” The defendant sent photos of himself and described his car to the potential victim. EVANS also sent text messages depicting the sexual acts he wanted to engage in with the girl and photos of sex toys and clothes that he had bought as “gifts” for her.

According to the criminal complaint and documents filed in court, on June 22, 2015, EVANS was apprehended shortly after he arrived at the Bloomington hotel at which he had planned to engage in illicit sexual relations with the 13-year-old female.

This case is the result of an investigation conducted by Homeland Security Investigations with the assistance of the Bloomington Police Department.

This case is being prosecuted by Assistant United States Attorney Kevin S. Ueland.

 

Defendant Information:

JEFFREY SCOTT EVANS, 51

Blaine, Tenn.

Charges:

• Traveling with the intent to engage in illicit sexual conduct, 1 count

 

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The charges contained in the criminal complaint are merely allegations, and the defendant is presumed innocent unless and until proven guilty.

United States Attorney Andrew M. Luger today announced the conviction of MALCOLM ROY EVANS, 52, for armed bank robbery, carjacking, attempted carjacking, and forcing another to accompany while fleeing from the scene. On January 22, 2015, EVANS was indicted for these offenses and, following a four-day trial, a jury found EVANS guilty on June 18, 2015, of all counts of the indictment.

Assistant U.S. Attorney Thomas Hollenhorst said: “Through the hard work of law enforcement and the full cooperation of the victims of these crimes, a violent criminal was brought to justice. The streets of the Fargo-Moorhead area are much safer as a result.”

As proven at trial, on December 29, 2014, EVANS entered a Wells Fargo bank in Moorhead, Minn., and threatened to shoot the teller with a sawed-off shotgun if she didn’t give him money from the bank’s till. EVANS left the bank with approximately $10,100 and attempted to carjack at gunpoint a woman and her college-age daughter who were driving a Volkswagen minivan, but the two victims ran from the minivan and took the keys with them. The defendant fled on foot for approximately two blocks before he got into a Ford F-150 parked nearby, pointed the sawed-off shotgun at a third victim’s head, and ordered him to “drive to the interstate.” At EVANS’ direction, the victim got out of the truck at the West Acres Mall in Fargo, N.D. EVANS abandoned the truck in a parking lot several blocks away and took a bus from the West Acres Mall to a nearby motel.

As proven at trial, on December 30, 2014, law enforcement arrested EVANS at the motel where they found more than $2,500 in cash, a sawed-off shotgun, shotgun shells, and some of the clothing EVANS was seen wearing in the Wells Fargo bank surveillance video.

This case is the result of an investigation conducted by the Federal Bureau of Investigation, Moorhead Police Department, and the Fargo Police Department.

Assistant U.S. Attorneys Thomas M. Hollenhorst and Bradley M. Endicott are prosecuting the case.

 

Defendant Information:

MALCOLM ROY EVANS, 52

Fargo, N.D.

Convicted:

• Armed Bank Robbery, one count
• Carjacking, one count
• Attempted Carjacking, one count
• Forcing a Person to Accompany the Defendant While Avoiding and Attempting to Avoid Apprehension, one count

 

 

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United States Attorney Andrew M. Luger today announced that LAMETTI & SONS, INC. agreed to pay a $10,000 fine and an additional $10,000 in restitution to the non-profit group Refuge Friends, Inc., to resolve allegations in a criminal petty offense citation charging it with one count of disturbing plants during the summer of 2014 in the Minnesota Valley National Wildlife Refuge in Bloomington, Minn.

According to the citation and documents filed in court, LAMETTI was awarded a contract by the Metropolitan Council Environmental Services Burnsville Interceptor Improvements Project for a multi-year construction project to reline sewer pipes on the Minnesota Valley National Wildlife Refuge in Bloomington. A Special Use Permit with specific limitations was incorporated into the construction plans to protect nearby areas of threatened and special-concern plants within the Refuge, which were delineated with signs that read, “Protected Native plants in this area do not enter or disturb.”

According to the violation notice and other court documents, on July 17, 2014, a concerned citizen reported to local wildlife agencies that a large amount of dead vegetation, which potentially included threatened prairie plants such as tobacco root and the small white lady’s-slipper, had been discovered within the Refuge.

On July 18, 2014, U.S. Fish and Wildlife Service (USFWS) agents and a Metropolitan Council representative investigated the area in which dead vegetation was reported. USFWS agents also noted an additional location of standing water containing dead wildlife directly adjacent to one of the construction sites, which emitted a strong chemical odor. About one week later, a USFWS agent observed that the standing water adjacent to the construction site had dissipated and left approximately 6,229 square feet of dead vegetation.

In a memo dated July 24, 2014, a LAMETTI project manager responded to the Metropolitan Council’s inquiries and stated that up to an estimated 24,000 gallons of heated cure water were released at two separate project construction sites within the Refuge due to a problem with the installation process of the liners on the sewer pipes on two separate dates. The heated cure water release was unauthorized and went unreported prior to the investigation. According to the Special Conditions of the Special Use Permit, the permit holder was required to report all damage to lands within 24 hours of the incident.

“A large portion of the Minnesota Valley National Wildlife Refuge is urban and provides valuable habitat for a wide range of plants and wildlife,” said U.S. Fish and Wildlife Service, Refuge Law Enforcement Officer Scott Pariseau. “Another benefit to our urban refuge is the unique opportunity we provide for the community to enjoy and appreciate wildlife-related recreation close to home. It’s unfortunate that despite all of the planning and permitting to mitigate resource damage from this project, damages to important habitat occurred. We are however pleased to see that the contractor was held responsible for the damage they caused to this public resource.”

The citation issued is the result of an investigation conducted by the U.S. Fish and Wildlife Service.

This case was prosecuted by Assistant U.S. Attorney Benjamin Bejar.

 

Defendant Information:

LAMETTI & SONS, INC.

Hugo, Minn.

Charges:

• Disturbing plants on National Wildlife Refuge, 1 count

Settlement:

• $10,000 fine
• $10,000 restitution

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

United States Attorney Andrew M. Luger today announced the guilty plea of JAMES SIGANOS, 50, to one count of tax evasion. SIGANOS was charged on May 26, 2015, by felony information, of evading corporate income taxes. He pleaded guilty yesterday before U.S. District Judge Ann D. Montgomery in U.S. District Court in Minneapolis, Minn. A sentencing date has not yet been determined.

According to his guilty plea and documents filed in court, SIGANOS was the owner of a carpet-cleaning business located in Mound, Minnesota. As owner of the company, the defendant was responsible for filing federal corporate tax returns on behalf of the company. SIGANOS filed a Form 1120S U.S. Income Tax Return for the calendar year 2009, in which he underreported his company’s gross receipts or sales as $246,166.

In 2009, SIGANOS’ company had approximately $591,013 in gross receipts or sales. To avoid paying taxes on the full amount of his company’s revenue, SIGANOS cashed more than 1,400 checks totaling approximately $410,905 at a check cashing facility in Minneapolis. The result was that the defendant underreported his 2009 income by approximately $344,858. SIGANOS filed no corporate income tax returns for the tax years 2010, 2011, and 2012, resulting in an underreporting of approximately $438,991. The total tax loss caused by SIGANOS is approximately $300,000.

“Tax evasion is not a victimless crime,” said Shea Jones, Special Agent in Charge of the St. Paul Field Office IRS Criminal Investigation. “IRS special agents work diligently to identify and bring to prosecution those who evade their taxes.”

SIGANOS faces up to three years in prison.

This case is the result of an investigation conducted by the Internal Revenue Service – Criminal Investigation Division.

This case is being prosecuted by Assistant U.S. Attorney Joseph H. Thompson.

 

Defendant Information:

JAMES SIGANOS, 50

Mound, Minn.

Convicted:

• Tax Evasion, 1 count

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

United States Attorney Andrew M. Luger today announced the conviction after a jury trial of LEVI WAYNE BURNS, 40, for distribution of child pornography. BURNS pleaded on guilty on June 5, 2015, to possession of child pornography in the same case. The defendant was charged by indictment on November 20, 2014, with one count of possession and one count of distribution of child pornography. BURNS was convicted in 2005 in Sherburne County, Minn., for criminal sexual conduct in the third degree for engaging in sexual acts with a 15-year-old female child. A sentencing date on the federal conviction has not yet been determined.

According to the defendant’s guilty plea and as proven at trial, in January 2014, BURNS shared electronically several files containing images and videos of child pornography, including a video depicting two female children between the ages of 10 and 14 engaged in sexual acts. BURNS, who lived in the basement of his parents’ home in Sherburne County, operated a large number of computers and related equipment. In fact, BURNS was using so much computer power that he and his parents were using the heat generated by the defendant’s computers to heat their house that winter, which was one of the coldest in recent Minnesota history.

According to the defendant’s guilty plea and as proven at trial, BURNS was operating a specially built computer with several hard drives, at least one of which was dedicated to storing and sharing child pornography over the internet. The defendant also saved thousands of files of child pornography on a separate external hard drive.

This case is the result of an investigation conducted by the Federal Bureau of Investigation, Sherburne County Sheriff’s Office, and the Minneapolis Police Department.

Assistant U.S. Attorneys Katharine T. Buzicky and Sarah E. Hudleston are prosecuting the case.

 

Defendant Information:

LEVI WAYNE BURNS, 40

Zimmerman, Minn.

Convicted:

• Distribution of child pornography, 1 count
• Possession of child pornography, 1 count

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

United States Attorney Andrew M. Luger today announced the indictment of PHILLIP DWAYNE LLOYD a/k/a “PC,” 43, and RAQUEL MONE BELCHER, 29, for trafficking three teenage girls for the purpose of commercial sex. LLOYD is also charged with producing child pornography of one of the trafficked victims. BELCHER is additionally charged with possession of child pornography. The defendants, who were indicted in May, were fugitives until yesterday when they were arrested by United States Marshals in the Chicago-area. The defendants made initial appearances yesterday in United States District Court in the Northern District of Illinois.

According to the indictment and documents filed in court, between January 14, 2015, and January 27, 2015, LLOYD, who is a registered sex offender, and BELCHER, trafficked three girls in and around the Twin Cities for the purpose of commercial sex. All three victims were under the age of eighteen. During this time, LLOYD also made pornographic videos of one of the minor victims engaging in sexually explicit conduct.

According to the indictment and documents filed in court, between August 2, 2010 and August 22, 2010, LLOYD trafficked a fourth juvenile victim for the purpose of commercial sex.

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

If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.

This case is the result of an investigation conducted by Homeland Security Investigations, the Minneapolis Police Department, Anoka County Sheriff’s Office, the Federal Bureau of Investigation, and the United States Marshals.

This case is being prosecuted by Assistant U.S. Attorney Laura M. Provinzino.

 

Defendant Information:

 

PHILLIP DWAYNE LLOYD a/k/a “PC,” 43

Coon Rapids, Minn.

 

Charges:

• Sex trafficking of a minor or by force, fraud, or coercion, 4 counts
• Production of child pornography, 1 count

 

RAQUEL MONE BELCHER, 29

Minneapolis, Minn.

 

Charges:

• Sex trafficking of a minor or by force, fraud, or coercion, 3 counts
• Possession of child pornography, 1 count

 

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

 

The charges are merely accusations, and the defendants are presumed innocent unless and until proven guilty.