District of Minnesota

United States Attorney Andrew M. Luger today announced the sentencing of GARY RICHARD VIBBARD, 58, formerly of Ocala, Florida, to 63 months in federal prison for stealing more than $3,000,000 from dozens of investors and investment fund managers. Rather than paying investors based on corporate profits as promised, the defendant operated a Ponzi-like scheme, repaying earlier investors with investment funds provided by later investors. VIBBARD pleaded guilty on May 15, 2014, in U.S. District Court in St. Paul, to mail fraud.

“Mr. Vibbard tricked investors into believing they were making an informed and sound investment,” said U.S. Attorney Luger. “By lying about his past and disguising his operation as legitimate, he was able to defraud his clients of millions of dollars. Investment fraud is a priority for this Office and financial predators will be brought to justice.”

According to his guilty plea and documents filed in court, VIBBARD, the owner and manager of R. Capital Advisors (RCA), operated a Ponzi-like scheme to defraud investors and investment fund managers. VIBBARD admitted that from approximately August 20, 2008 until 2010, he marketed and sold investments by lying about RCA’s financial performance and capabilities and by omitting facts about his history as a financial manager. VIBBARD told potential investors that he was a proven and talented financial manager, when in fact he had filed for bankruptcy in 2000, owed more than $1.5 million in back taxes, and lost more than $1,000,000 in investor funds through a prior failed company.

In addition to using investor funds to repay prior investors, VIBBARD used the funds entrusted to him for personal expenses including child support, gym membership, upscale clothing, and an internet dating service. VIBBARD directed his bookkeeper to drain corporate bank accounts and hide the funds in cashier’s checks, to thereby prevent creditors and the Internal Revenue Service from seizing accounts.

As part of his plea agreement, VIBBARD agreed to pay $6.9 million in restitution, which includes restitution for losses from before the period covered by the guilty plea.

Assistant U.S. Attorney Robert M. Lewis prosecuted this case.

This case was the result of an investigation conducted by the United States Postal Inspection Service and the Federal Bureau of Investigation, with assistance from the Lake County, Florida Sheriff’s Department.

Defendant Information: GARY RICHARD VIBBARD
Ocala, FL

Convicted: • Mail Fraud, 1 count

Sentenced: • 63 Months in federal prison
• 3 years supervised release

 

 

United States Attorney Andrew M. Luger and Acting Assistant Attorney General Molly Moran for the Justice Department’s Civil Rights Division today announced the filing of a lawsuit against the City of St. Anthony Village for an alleged violation of the Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA). Specifically, the lawsuit seeks injunctive relief requiring St. Anthony to allow the Abu Huraira Islamic Center to maintain a worship space in the basement of the St. Anthony Business Center.

“Freedom of religion and the right to assemble peaceably are enshrined for all Americans in the Bill of Rights,” said U.S. Attorney Luger. “This office conducted a thorough investigation of the circumstances surrounding the City Council’s decision to deny Abu Huraira the right to worship in the St. Anthony Business Center. It is a solemn duty of all United States Attorneys to uphold the Constitution. The people of Abu Huraira have a right to assemble peaceably – they have a right to practice their religion, and it’s our job to enforce that right.”

“Religious freedom is one of our most cherished rights, and there are few aspects of that right more central than the ability of communities to establish places for collective worship,” said Molly Moran, Assistant Attorney General of the Civil Rights Division.

The complaint, filed in the U.S. District Court in Minneapolis, alleges that the St. Anthony Village City Council treated an application for a conditional use permit to assemble in the St. Anthony Business Center filed by Abu Huraira on less than equal terms as other, non-religious, conditional use permits for assembly. The denial of the necessary permit for the worship center unlawfully disfavored a religious use, because the light industrial zone where the building is located allowed “assemblies, meeting lodges and convention halls,” including a union hall with banquet facilities available to be rented by the public.

In addition to Abu Huraira treatment on less than equal terms to similarly situated secular organizations, the denial of Abu Huraira’s permit substantially burdens its members in practicing their faith. Abu Huraira members’ ability to exercise their religion is limited by their current worship site options, including, but not limited to the fact that members in the northern Twin Cities are burdened from praying together based on the length of time it takes to travel to the worship centers in south Minneapolis. Moreover, prayer space at locations in Minneapolis are too small to accommodate members, many of whom often have to pray in hallways or entryways, and hold multiple prayer sessions in shifts to accommodate crowds.

After conducting a search for adequate prayer space lasting nearly three years, Abu Huraira entered into a purchase agreement for the St. Anthony Business Center. The business center is an ideal location for Abu Huraira because it is centrally located, has a basement measuring approximately 11,600 square feet, and has ample parking. The business center is in the “light industrial” zone of St. Anthony, conditional uses for which included “assemblies, meeting lodges, and convention halls.”

In February 2012, after consulting St. Anthony Village officials, Abu Huraira applied for a conditional use permit for assembly in the light industrial zone. It was denied on June 12, 2012, by a St. Anthony Village City Council vote of 4-1, despite the professional St. Anthony City Planning Staff recommending approval, despite the St. Anthony Village City Planning Commission recommending approval, and despite members of Abu Huraira attending each meeting of the Council and Planning Commission to address any concerns held by the City.

The lawsuit filed by the U.S. Attorney’s Office in Minnesota seeks to enforce Abu Huraira’s constitutional rights under RLUIPA by requiring St. Anthony Village to grant the conditional use permit to allow Abu Huraira to assemble for the purpose of worship.

Assistant U.S. Attorneys Bahram Samie, Ana Voss, and Greg Brooker, as well as Justice Department attorneys from the Civil Rights Division are representing the United States in this matter.

RLUIPA, enacted in 2000, contains multiple provisions prohibiting religious discrimination and protecting against unjustified burdens on religion exercise. Persons who believe that they been subjected to religious discrimination in land use or zoning may contact the Housing and Civil Enforcement Section of the Justice Department’s Civil Rights Division at 1-800-896-7743. More information about RLUIPA, including a report on the first ten years of its enforcement, may be found at http://www.justice.gov/crt/about/hce/rluipaexplain.php.

 

 

United States Attorney Andrew M. Luger today announced the sentencing of KHEMALL JOKHOO, 36, to 175 months in federal prison for attempting to steal more than $700,000 by using the identities of more than 60 victims. On November 5, 2013, a jury in United States District Court in Minneapolis convicted JOKHOO of all the charges presented to them, including Aggravated Identity Theft, Bank Fraud, Mail Fraud, Wire Fraud, and False Personation of an Officer or Employee of the United States.

“Identity theft is a widespread problem,” said U.S. Attorney Luger. “Working with our partners in local and federal law enforcement, including the Minnesota Financial Crimes Task Force, we stopped this defendant from targeting additional victims. Only through continued partnership among law enforcement officials will we stem the tide of financial fraud and identity theft. There is more work to be done.”

As proven at trial and according to documents filed in court, JOKHOO, formerly registered as a debt collector, was the owner and sole employer of First Financial Services, Inc. (First Financial), a collection agency licensed in Minnesota from May 9, 2002, until November 3, 2009. As a debt collector, the defendant had access to sensitive credit information, including social security numbers, bank account information, dates of birth, addresses, and other identifying information of the victims of his scheme. JOKHOO used this information to harass and intimidate victims and to demand payment to him for purported debts. When he could not convince victims to pay him, JOKHOO impersonated victims, using their bank account and other identifying information to take over and steal directly from their accounts.

According to documents filed in court, JOKHOO, in addition to using intimidation tactics, threatened victims with physical harm if they did not pay him. With regard to one victim, a disabled veteran, the defendant threatened to “push his wheelchair over the bridge,” if he did not pay. JOKHOO also targeted elderly victims as part of his scheme. Assistant U.S. Attorney Lola Velazquez-Aguilu said: “The term ‘identity theft’ seems an inadequate description for what the defendant did to the victims in this case. He used their identifying information not only to steal their money, but also to terrorize them, taking pleasure in making other human beings feel completely powerless and without worth. This defendant’s sentence sends an important message to debt collectors who use their positions of trust to steal.”

Assistant U.S. Attorneys Velazquez-Aguilu and LeeAnn K. Bell prosecuted this case.

The Minnesota Financial Crimes Task Force, Minnesota Department of Commerce, United States Postal Inspection Service, and Lonsdale Police Department conducted the investigation.

The Minnesota Financial Crimes Task Force was established under state law, and is comprised of local, state, and federal law enforcement investigators, who work to combat the growing trend of cross-jurisdictional financial crimes.

Defendant Information:

KHEMALL JOKHOO
Lonsdale, MN

Convicted: • Bank Fraud, 11 counts
• Aggravated Identity Theft, 10 counts
• Mail Fraud, 9 counts
• Wire Fraud, 2 counts
• False Personation of an Officer or Employee of the United States, 1 count

Sentenced: • 175 Months in federal prison
• 5 years supervised release

 

 

United States Attorney Luger announced an indictment unsealed on Thursday, August 14, 2014, after the arrest of two defendants charged in a conspiracy to file fraudulent tax returns while incarcerated in state prison. A federal grand jury on August 12, 2014, returned a 21-count indictment charging TONY TERRELL ROBINSON, 30, and TANKA JAMES TETZLAFF, 39, with conspiring to defraud the United States and filing and making false claims against the government.

According to the indictment, from October 2009 through approximately September 2010, ROBINSON and TETZLAFF, who were incarcerated by the state of Minnesota in the Faribault Correctional Facility, conspired to prepare and file false federal income tax returns and fraudulently claim tax refunds. As part of their scheme, the defendants recruited other state prisoners to file false tax returns using their names and social security numbers. The defendants and other co-conspirators filed the tax returns using false wage and federal income tax withholding information.

According to the charges, tax refunds were paid by check, deposited directly into bank accounts, or deposited onto debit cards. Co-conspirators who were not in prison, including CARMEN ALLEN, VANESSA WALBERG, and DEEANNA CRIST, received refund checks at addresses they controlled, which were then cashed using a Power of Attorney signed by the filing co-conspirators. Refunds also were deposited directly into bank accounts controlled by the co-conspirators. As a result of the conspiracy, over $400,000 of false claims were made to the Internal Revenue Service.

ALLEN pleaded guilty to a conspiracy charge in March 2014 and was sentenced on August 7, 2014. Both, WALBERG and CRIST pleaded guilty to a conspiracy charge in May 2014 and are awaiting sentencing.

Assistant U.S. Attorney Michael Cheever is handling the prosecution.

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

For more information about how to protect yourself from identity theft, visit http://www.stopfraud.gov/protect-identity.html.

The IRS-Criminal Investigations urges citizens to review the Taxpayer Guide to Identity Theft, which can be found at http://www.irs.gov.

Defendant Information: TONY TERRELL ROBINSON
Bayport, MN

Charges: • Conspiracy to Defraud the United States, 1 count
• False Claims against the United States, 10 counts

TANKA JAMES TETZLAFF
Duluth, MN

Charges: • Conspiracy to Defraud the United States, 1 count
• False Claims against the United States, 10 counts

The charges contained in an indictment are mere allegations and defendants are presumed innocent unless and until proven guilty.

 

 

United States Attorney Andrew M. Luger today announced the August 6, 2014 indictment of DENNIS CHARLES HELMER, a/k/a “Jeff Jones,” a/k/a, “Mr. Diamond,” a/k/a, “Dennis Dimon,” 53, for devising an elaborate coin fraud scheme and defrauding victims of over $1 million. HELMER is charged with 16 counts of Mail Fraud and three counts of Wire Fraud. In an unrelated indictment unsealed on August 12, 2014, TORY EVAN HUGHES, 44, is charged with Mail Fraud in a similar coin fraud scheme. In a third unrelated case, a felony Information was filed on July 22, 2014, in federal court charging CHRYSANTHOS NICHOLAS, 55, with one count of Mail Fraud.

“Minnesota has more than its share of coin fraud,” said U.S. Attorney Luger. “In completely unrelated cases, these three defendants are charged with defrauding unsuspecting victims of more than $2 million dollars in total. Working with federal, state, and local law enforcement partners, we are investigating and prosecuting those who prey on vulnerable victims.”

According to the indictment, HELMER operated Wholesale Assets Worldwide, LLC (WAW), which engaged in appraising, buying, selling, and trading of coins and precious metals. From November 2009 to
December 2013, through WAW, HELMER contacted individuals, many of whom were elderly, and persuaded them to send him money, coins, and precious metals, based on his false promises to provide money or coins in return. Some victims also relied on HELMER to provide safe storage for their coins. As part of the scheme, HELMER intentionally misled customers about the size and stability of his business, including providing them with copies of a false “Dun and Bradstreet Credibility Report,” and stating that WAW had 75 employees and $500 million in annual revenue.

According to court documents, WAW received over $1.2 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 company, Smoke Shack, Inc.

According to the indictment, HELMER at different times used various aliases, including “Jeff Jones,” in an attempt to hide his prior criminal charges 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. In January 2014, HELMER formed Best Price International, LLC and continued to operate his scheme to defraud customers, this time under the aliases, “Mr. Diamond” and “Dennis Dimon.”

In an unrelated indictment unsealed on August 12, 2014, TORY EVAN HUGHES, 44, is charged with Mail Fraud in a similar coin fraud scheme. According to the indictment, HUGHES owned and operated Reputable Rare Coins, LLC (RRC), located in Roseville, Minnesota. HUGHES bought and sold gold, silver and other coins. The defendant and his sales staff made unsolicited phone calls, primarily to elderly individuals, in an attempt to sell or buy coins. Several customers sent money and coins to HUGHES and received nothing in return. HUGHES is charged with stealing more than $600,000 in cash and coins.

According to the indictment, in November 2013, HUGHES moved his coin fraud operation to Gilbert, Arizona, where he continued to victimize elderly individuals in the same manner as he had done through RRC. Through his new business, U.S. Collectables, HUGHES stole more than $100,000 from customers intending to purchase coins.

In a third unrelated case, a felony Information was filed on July 22, 2014, in federal court charging CHRYSANTHOS NICHOLAS, 55, with one count of Mail Fraud. NICHOLAS is scheduled to make his first appearance before United States District Court Chief Judge Michael J. Davis on August 20, 2014.

According to the information, NICHOLAS owned and operated two coin businesses, TWC Trading (TWC) and North Fork Six Rare Coin Consultants (North Fork), located in New York State. Both businesses evaluated, stored, bought, sold and traded coins and precious metals. Through TWC and North Fork, NICHOLAS entered into contracts with clients to evaluate, store, and sell their coins; however, NICHOLAS did not pay his clients or return the coins to the clients upon their request. Through this scheme NICHOLAS stole more than $200,000 of coins and precious metals.

Assistant U.S. Attorney Kimberly Svendsen is handling the case against DENNIS CHARLES HELMER.

Assistant U.S. Attorney Karen Schommer is handling the cases against TORY EVANS HUGHES, and
CHRYSANTHOS NICHOLAS.

The U.S. Postal Inspection Service investigated the HELMER and HUGHES cases. The Minnesota
Department of Commerce also investigated the HELMER case. The Roseville Police Department also worked the HUGHES investigation.

The Federal Bureau of Investigation conducted the NICHOLAS investigation.

Defendant Information:

DENNIS CHARLES HELMER, D.O.B. 2/3/1961
Farmington, MN

Charges: • Mail Fraud, 16 counts
• Wire Fraud, 3 counts

TORY EVAN HUGHES, D.O.B. 12/8/1969
Minneapolis, MN

Charges: • Mail Fraud, 1 count

CHRYSANTHOS NICHOLAS, D.O.B. 1/22/1959
Mettituck, NY

Charges: •Mail Fraud, 1 count

The charges contained in an indictment are mere allegations and defendants are presumed innocent unless and until proven guilty.

 

 

SYNTHETIC DRUGS

U.S. Attorney Andrew M. Luger today announced the sentencing of JAMES CARLSON, 57, the former owner of Last Place on Earth (LPOE), and LAVA HAUGEN, 34, who were convicted on October 7, 2013, after a jury trial in U.S. District Court in Minneapolis for their roles in a conspiracy to distribute synthetic drugs. CARLSON was sentenced by United States
District Judge David Doty to 17.5 years in federal prison. HAUGEN was sentenced to 5 years in prison.

Assistant U.S. Attorney Surya Saxena said: “The Court’s sentence, and the jury verdicts in this case, should confirm once and for all that synthetic drugs are illegal, and that they always have been illegal under both the Food Drug and Cosmetic Act and the Controlled Substances
Analogue Enforcement Act. These drugs are just as dangerous as traditional illicit drugs like methamphetamine, cocaine, and heroin, and their effects are often more unpredictable.”

“Synthetic drugs, like those sold at Last Place on Earth, create health and safety dangers for individuals, their families, and their communities,” said U.S. Attorney Andy Luger. “Residents, medical personnel, and law enforcement officials in Duluth know this all too well. Moreover, these drugs are illegal, and those who sell them should expect to be prosecuted.”

Kelly R. Jackson, Internal Revenue Service Criminal Investigation Division Special Agent in Charge of the St. Paul Field Office said: “Today’s sentencing demonstrates how federal law enforcement will band together to help put an end to the criminal behavior of those who prey on others for their personal financial gain. IRS Criminal investigators will continue to use their financial expertise to identify and trace laundered funds in these types of fraud schemes.”

John J. Redmond, U.S. Food and Drug Administration Office of Criminal Investigations, Special Agent in Charge of the Chicago Field Office, which includes Minnesota, said: “The defendants in this case demonstrated blatant disregard for the health and welfare of the general public by illegally distributing dangerous misbranded drugs. The sentence speaks for itself and serves as a deterrent to others who choose to put the public’s health at risk. We commend the
U.S. Attorney's Office and our law enforcement partners for their dedicated collaborative efforts in pursuing this matter."

Jack Riley, U.S. Drug Enforcement Administration Special Agent in Charge of the Chicago Field
Division, which includes Minnesota, said: “Today’s sentence should send a message to those involved in the distribution of synthetic drugs. And I hope they hear that message loud and clear; those who sell these dangerous drugs in our communities and hope to avoid detection by mislabeling and misrepresenting their intended use will be investigated and prosecuted to the fullest extent of the law. I hope today’s sentence also sends a message to the community that these types of drugs pose a serious public health threat to the state and region,” he added.

As proven at trial, CARLSON and HAUGEN conspired to obtain and sell synthetic drugs misbranded as incense, potpourri, bath salts, exotic skin treatments, glass cleaner, watch cleaner. The items, marketed under names like “No Name,” “Smoking Dragon,” “Role-X Watch Cleaner,” and
“Binger,” among others, were synthetic drugs as defined by federal law, and subject to regulation pursuant to the U.S. Food and Drug Administration (FDA). The defendants intended to and did sell these synthetic drugs for human consumption for the purpose of mimicking other illegal narcotics and hallucinogens.

As proven at trial, CARLSON and HAUGEN intentionally misled government authorities with the false labels, which, in addition to suggesting that the products were not drugs, failed to describe package contents accurately, failed to include health warnings regarding use, and failed to identify the manufacturer or distributor of the items. Between March 16, 2010, and September
29, 2012, the defendants paid nearly $2 million for at least 510 packages of synthetic drugs from suppliers in California, Arizona, Wisconsin, Florida, and Pennsylvania.

From at least 2010 through 2013, CARLSON made millions of dollars by distributing synthetic drugs through LPOE. He used LPOE employees as guinea pigs for testing untested and unregulated drugs so that he could confirm that those drugs would “work” on his customers. Some LPOE customers became addicted to the synthetic drugs sold by CARLSON and suffered dangerous side effects, including tachycardia, paranoia, agitation, seizures, and black outs.

As proven at trial, HAUGEN regularly ordered synthetic drugs from suppliers. She acted as a general manager of LPOE, and was responsible for weighing and repackaging bulk quantities of synthetics.
HAUGEN also managed inventory, verified orders of drugs delivered to LPOE, and sold synthetic drugs both by mail, and in person to LPOE customers.

According to documents filed in court, Duluth-area hospital emergency rooms treated a significant number of synthetic drug users while LPOE was in operation. By 2012, the emergency room at St. Luke’s Hospital was receiving nearly three synthetic-drug-abuse cases each day. Of those, approximately 10 percent exhibited serious symptoms requiring the use of physical restraints and chemical sedatives or admission to the Intensive Care Unit or mental health ward.
Each patient willing to disclose to hospital staff where they obtained the synthetic drugs they took, invariably reported obtaining the drugs from LPOE. After the City of Duluth successfully enjoined LPOE from distributing synthetic drugs, St. Luke’s Hospital reported a 95 percent decline in the number of synthetic drugs patients requiring emergency medical attention.

This case was prosecuted by Assistant U.S. Attorneys Surya Saxena and Nate Petterson.

U.S. Attorney Luger thanked the Duluth Police Department, the U.S. Food and Drug Administration, the U.S. Drug Enforcement Administration, and the Internal Revenue Service- Criminal Investigation
Division, the United States Marshals Service, the Duluth City Attorney’s Office, the St. Louis
County Attorney’s Office, and the Lake Superior Drug and Violent Crime Task Force.

Defendant Information: JAMES CARLSON, D.O.B. 4/30/1957
Superior, WI

Convicted: • Conspiracy to Commit Offenses against the United States, 1 count
• Causing Misbranded Drugs to be Introduced into Interstate Commerce, 9 counts
• Delivery of Misbranded Drugs Received in Interstate Commerce, 6 counts
• Doing Acts Resulting in Drugs Being Misbranded While Held for Sale, 1 count
• Distribution of a Controlled Substance, 1 count
• Conspiracy to Distribute Controlled Substance Analogues, 1 count
• Distribution of Controlled Substance Analogues, 8 counts
• Monetary Transactions in Property Derived from Specified Unlawful Activity, 24 counts

Sentenced: • 17.5 years in Federal Prison
• 3 years of supervised release

LAVA HAUGEN, D.O.B. 7/16/1980
Superior, WI

Convicted: • Conspiracy to Commit Offenses against the United States, 1 count
• Delivery of Misbranded Drugs Received in Interstate Commerce, 1 count
• Doing Acts Resulting in Drugs Being Misbranded While Held for Sale, 1 count
• Conspiracy to Distribute Controlled Substance Analogues, 1 count

Sentenced: • 5 years in Federal Prison
• 3 years of supervised release

 

 

$4 MILLION

United States Attorney Andrew M. Luger today announced the sentence of MARK HOLT, 45, to ten years in federal prison for stealing more than $4 million from his investment advisory clients.
The defendant, a securities broker, investment advisor, and now disbarred attorney, operated a fraud scheme for at least eight years, during which time he used the criminal proceeds to fund his own lavish lifestyle. HOLT pleaded guilty on April 1, 2014, in United States District Court in St.
Paul, MN, to wire fraud.

“Far too often, investment advisors are caught defrauding their clients,” said U.S. Attorney Luger.
“This defendant was an attorney during the time that he was stealing from his clients. He not only engaged in criminal activity by stealing from his clients, he eroded public trust in our profession. My Office will continue to prosecute aggressively those who abuse professional positions of trust.”

According to his guilty plea, HOLT owned and operated the Harbor Investment Planning Group, LLC, later known as the Harbor Group, LLC (Harbor Group) from 2002 through January 2014. In 2005, HOLT opened bank accounts in the name of the Harbor Group, over which he had exclusive control. Between
September 2005 and November 2013, HOLT persuaded investors to place more than $4 million into his trust by telling them that he was investing their money in legitimate long-term investments, such as bonds and mutual funds with JP Morgan Chase, Morgan Stanley, Berkshire Hathaway, and others. By convincing clients to make long-term investments, HOLT expected them not to draw on those funds for many years. Instead, HOLT diverted the funds into Harbor Group checking accounts.

HOLT continued to defraud his clients using an array of schemes to make their investments seem legitimate, including making monthly annuity or interest payments to clients; providing fraudulent Morningstar “Portfolio Fact Sheet, Client Summary” printouts falsely reflecting that the clients’ funds had been placed in legitimate investment products; and creating online accounts for clients with Blueleaf, a web-based portal for viewing account information, including account balances and performance information, and causing weekly e-mail updates to be sent to clients via the Blueleaf system showing fraudulent account balances.

According to the documents filed in court, HOLT converted the investors’ money to his own use. He spent most of the money to fund his lavish lifestyle, including purchasing a membership at the
White Bear Yacht Club, luxury cars from Maplewood Imports and Sears Imports, and stays at the Ritz
Carlton. He also used some of the stolen funds to make Ponzi payments to the victims.

This case was prosecuted by Assistant U.S. Attorney Kimberly Svendsen.

U.S. Attorney Luger thanked the Federal Bureau of Investigation for its assistance in the investigation.

Defendant Information:

MARK HOLT, D.O.B. 9/15/1969
Vadnais Heights, MN

Convicted: • Wire Fraud, 1 count

Sentenced: • 10 years in Federal Prison
• 3 years supervised release
• Restitution of $2,940,982.75

 

 

United States Attorney Andrew M. Luger today announced the indictment of 20 members of the
Mustafa Family (The Organization), a Twin Cities-based criminal organization, for trafficking stolen and fraudulently obtained mobile telephones and tablets. The Organization, led by
JAMAL TALAL MUSTAFA, a/k/a “Jimmy,” primarily obtained devices by robbery, burglary, identity theft, and contract-fraud schemes. JAMAL MUSTAFA¸ KANAN M T MUSTAFA, a/k/a “Kenny,” NASER MOHAMAD MUSTAFA, a/k/a “Nasty Nas,” EDWAN T MUSTAFA, a/k/a “Eddy,” NIZER M MUSTAFA, a/k/a “Shaggy,” a/k/a “Mike,” BILAL MUHAMMED MUSTAFA, a/k/a “Billy,” TALAL M MUSTAFA, a/k/a “Tommy,” MOISES NAVARRO CAZALES, AHMED RD SUNOQROT, a/k/a “Abu Shanab,” CEDRIC CHAPPELL, DEANTRE RICKEY-RENE SQUALLS, BLANYON TOE DAVIES, VICTOR TOMBEKAI DOE, YOLANDA COOMBS, CASWANA MILES, MARCUS PHILLIP COLEMAN, ROBERT RICHARD COLEMAN, DANIELLE YVONNE COLEMAN, MARQUIS TERELL MAGGIESFIELD, a/k/a “Kenny,” and TIARA LIGON, are each charged in U.S. District Court with Conspiracy to Engage in Interstate Transportation of Stolen Goods.

“Identity theft rings are the modern face of organized crime,” said U.S. Attorney Luger. “Identity thieves often use fraudulent identities to obtain goods, which they can sell for cash. These defendants are charged with obtaining stolen cell phones through identity theft and fraud, and then selling them for exorbitant profits. It is only through close collaboration and cooperation between each of the law enforcement agencies involved in this case that we are able to stand here today having taken out one of the largest criminal enterprises in the Twin Cities.”

St. Paul Police Department Assistant Chief Bill Martinez said: “We want our communities to understand that this isn’t just about someone simply swiping the phones we hold in our hands. These are not petty crimes. Those thefts and robberies filtered into other crimes.”

United States Secret Service Special Agent in Charge Louis Stephens said: “Today is a very good day for the people of Minnesota. A significant organized crime network is no longer at work. Today’s success is the result of the close and collaborative working relationships between local, state and federal law enforcement agencies, and federal prosecutors. When we combine our resources, leverage our various areas of expertise, and work as one, we make big things happen and significant crime is stopped in its tracks.”

Minnesota Bureau of Criminal Apprehension Superintendent Wade Setter said: “Today’s indictments in this complicated case are truly the product of investigative partnerships. The Minnesota Financial
Crimes Task Force worked this case along with the U.S. Secret Service and the St. Paul Police
Department in a multi-jurisdictional approach necessary to investigate this type of crime.”

University of Minnesota Assistant Vice President and Chief of Police Gregory S. Hestness said: “Last fall a wave of robberies targeted University of Minnesota students and their cell phones in campus area neighborhoods. Officers of the University of Minnesota Police Department worked literally thousands of hours in robbery suppression, and we saw results. However, without addressing the underlying criminal enterprise creating a market for these phones, we were not doing everything possible to protect our students. UMPD was honored to contribute to this critical major investigation. Today’s successes are remarkable, but also emblematic of the strong partnership of
Minnesota law enforcement at the local, state, and federal levels.”

According to the indictment and documents filed in court, from at least 2006 through 2014, JAMAL
MUSTAFA directed the Organization to use stolen identity information to obtain cellular telephones and other mobile devices for the purpose of trafficking them throughout the United
States and internationally. JAMAL MUSTAFA, KANAN MUSTAFA, NASER MUSTAFA, EDWAN MUSTAFA, NIZER MUSTAFA, BILAL MUSTAFA, TALAL MUSTAFA, and MOISES NAVARRO-CAZALES, owned and operated 13 mobile device stores in the Twin Cities metropolitan area. The Organization used these storefronts to buy devices that they knew had been illegally obtained, including purchasing thousands of cellular phones from runners and other persons who got the phones through robberies, burglaries, shoplifting, and fraud and identity-theft schemes.

With the assistance of AHMED SUNOQROT, the Organization moved inventory and money between their stores, which the Organization used as fronts to funnel the illicit proceeds of their criminal activity.

According to the indictment, the Organization paid runners who stole mobile devices or obtained them fraudulently by other means. CEDRIC CHAPPELL, DEANTRE-RICKEY-RENE SQUALLS, BLANYON TOE DAVIES, VICTOR TOMBEKAI DOE, YOLANDA COOMBS, CASWANA MILES, TIARA LIGON, MARQUIS TERELL MAGGIESFIELD, MARCUS PHILLIP COLEMAN, ROBERT RICHARD COLEMAN, and DANIELLE YVONNE COLEMAN, were each paid by the Mustafas to steal or fraudulently obtain mobile devices by contract or subscription fraud. They targeted stores like Best Buy, WalMart, Verizon outlets, T- Mobile stores, and online Apple stores.

As charged, various members of the Mustafa Family provided stolen or fraudulent identity information to the runners, including names, dates of birth, social security numbers, credit card numbers, passport information, and driver’s license numbers of victims. Some of the runners operated solely within Minnesota, while others travelled to Arizona, Idaho, North Dakota, Iowa, Wisconsin, Illinois, and Utah to obtain devices. The Organization arranged out-of-state travel for the runners and paid their expenses. One runner was arrested in Utah in 2013 with more than 80 counterfeit identification documents and genuine victim-information documents. This runner used those documents to open lines of credit at various retail outlets to make fraudulent device purchases.

The runners were instructed by the Mustafas to obtain phones by contract-fraud and subscription-fraud schemes. In such schemes, runners used real stolen identities to obtain cell phone contracts. At times, the runners obtained “family plans” or “business accounts.” In so doing, runners were sold phones at deeply discounted prices by the legitimate retailers. The full retail price of an iPhone 5s in the United States is approximately $648. Under a two-year contract, the same phone is sold for approximately $200. Runners then opened accounts entitling them to obtain as few as one discounted phone, and as many as 30. The runners then shipped or delivered the phones back to the Mustafas, via one of the thirteen Twin Cities storefronts, or shipped the phones to wholesalers in other states for sale overseas. A new iPhone 5s retails for between $1,000 and
$1,200 overseas.

Other runners engaged in street-level violence or burglary to obtain phones. The Sunrise Group, a burglary ring that traveled throughout the Upper Midwest for the purpose of breaking into WalMart stores to steal cell phones, iPads, and other electronic devices, provided electronic devices to the Mustafa Family on several occasions. The Mustafa Family made requests of the Sunrise Group for large quantities of new phones, and would act as a fence for the stolen merchandise.

Assistant U.S. Attorney Karen Schommer, Chief of the Major Crimes Section; Assistant U.S. Attorney
Steven Schleicher, Chief of the Special Prosecution Section; and Assistant U.S. Attorney
John Marti are handling the prosecution of this case.

U.S. Attorney Luger thanked the St. Paul Police Department, United States Secret Service, University of Minnesota Police Department, Minnesota Department of Public Safety and Bureau of
Criminal Apprehension, Minnesota Financial Crimes Task Force, United States Postal Inspection
Service, Internal Revenue Service Criminal Investigations, Homeland Security Investigations, Edina
Police Department, Minneapolis Police Department, Plymouth Police Department, Federal Bureau of
Investigation, and the United States Marshal’s Service for their assistance in the investigation.

Defendant Information:

JAMAL TALAL MUSTAFA, a/k/a “Jimmy,” D.O.B. 6/17/1972
Apple Valley, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

KANAN M T MUSTAFA, a/k/a “Kenny,” D.O.B. 6/16/1977
Rosemount, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

NASER MOHAMAD MUSTAFA, a/k/a “Nasty Nas,” D.O.B. 1/6/1991
Rosemount, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

EDWAN T MUSTAFA, a/k/a “Eddy,” D.O.B. 11/14/1974
Apple Valley, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

NIZER M MUSTAFA, a/k/a “Shaggy,” a/k/a “Mike,” D.O.B. 8/27/1978
Savage, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

BILAL MUHAMMED MUSTAFA, a/k/a “Billy,” D.O.B. 6/25/1984
Minneapolis, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

TALAL M MUSTAFA, a/k/a “Tommy,” D.O.B. 4/19/1971
Burnsville, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

MOISES NAVARRO CAZALES, D.O.B. 11/15/1992
Bloomington, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

AHMED RD SUNOQROT, a/k/a “Abu Shanab,” D.O.B. 6/2/1955
St. Paul, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

CEDRIC CHAPPELL, D.O.B. 2/17/1971
Minneapolis, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

DEANTRE RICKEY-RENE SQUALLS, D.O.B. 9/6/1990
Brooklyn Center, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

BLANYON TOE DAVIES, D.O.B. 8/8/1993
Unknown

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

VICTOR TOMBEKAI DOE, D.O.B. 2/1/1991
Unknown

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

YOLANDA COOMBS, D.O.B. 2/23/1987
Oakdale, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

CASWANA MILES, D.O.B. 8/10/1988
Unknown

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

MARCUS PHILLIP COLEMAN, D.O.B. 11/5/1991
St. Paul, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

ROBERT RICHARD COLEMAN, D.O.B. 5/3/1984
St. Paul, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

DANIELLE YVONNE COLEMAN, D.O.B. 12/1/1985
St. Paul, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

MARQUIS TERELL MAGGIESFIELD, a/k/a “Kenny,” D.O.B. 5/9/1986
Unknown

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

TIARA LIGON, D.O.B. Unknown
St. Paul, MN

Charges: • Conspiracy to Engage in Interstate Transportation of Stolen Goods, 1 count

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

 

 

United States Attorney Andrew M. Luger announced the sentencing last week of DOUGLAS LUKE ROBINETTE, 27, to 360 months in federal prison. ROBINETTE was indicted on April 9, 2013, and pleaded guilty to one count of Production of Child Pornography on November 8, 2013. He was sentenced on July 28, 2014, by United States District Court Chief Judge Michael J. Davis.

“Distributing child pornography re-victimizes the children in these cases,” said Assistant U.S. Attorney Lola Velazquez-Aguilu. “The defendant in this case sexually assaulted a young boy, digitally recorded the assaults, and emailed the images, virtually guaranteeing that they will forever exist in cyberspace. We hope that this sentence sends a strong message to others who trade in images of sexual violence against children.”

According to documents filed in court, ROBINETTE was convicted on November 11, 2010, of First Degree Criminal Sexual Conduct in Kanabec County, Minnesota. He was sentenced to a 144-month state prison sentence. After ROBINETTE’S conviction in Kanabec County, the United States Attorney’s Office investigated and prosecuted the defendant for the production of child pornography.

According to his guilty plea in federal court, ROBINETTE induced a developmentally delayed boy to engage in sexually explicit conduct, which the defendant recorded on his cell phone. ROBINETTE further admitted to engaging in sexual contact with the boy on several occasions, and producing and distributing images of the sexual contact.

The case was brought as part of Project Safe Childhood (“PSC”), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney offices and the Justice Department’s Criminal Division, Child Exploitation and Obscenity Section, PSC marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children and identify and rescue victims. For more information about PSC, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab “resources.”

This case was prosecuted by Assistant U.S. Attorney Lola Velazquez-Aguilu.

U.S. Attorney Luger thanked the Kanabec County Sheriff’s Office, the Minnesota Bureau of Criminal Apprehension, and the Minnesota Child Exploitation Task Force, which is sponsored by the Federal Bureau of Investigation.

Defendant Information: DOUGLAS LUKE ROBINETTE, D.O.B. 5/5/1986
St. Paul, MN

Convicted: • Production of Child Pornography, Felony

Sentenced: • 360 Months in Custody of the Bureau of Prisons
• Supervised Release for a term of life

 

 

United States Attorney Andrew M. Luger today announced the indictment of SEAN MEADOWS, 41, for using his financial planning and asset management firm, Meadows Financial Group (MFG), to operate a Ponzi scheme and fraudulently obtain at least $10 million from at least 50 victims. The defendant is charged with Mail Fraud, Wire Fraud, and Money Laundering offenses.

“Abusing the trust of those who invest their hard-earned money is particularly cynical,” said U.S. Attorney Luger. “This defendant is charged with defrauding victims out of their retirement and other savings, and spending their money on his own lavish lifestyle. Targeting investment fraud is a priority of this U.S. Attorney’s Office, and we will continue to work closely with our partners in federal and local law enforcement to root out fraud and seek justice for victims.”

Minnesota Commerce Commissioner Mike Rothman said: “We will fight for our seniors and investors who become victimized by the tragic financial abuse by professionals; we are working hard to stop and punish those who use their professional licenses to steal from Minnesotans. Working together with U.S. Attorney Luger, we are sending a strong message that they will be brought to justice.”

As charged in the indictment, 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 $10 million from more than 50 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.

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 charges, 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 $100,000 at adult entertainment establishments in Minnesota and Las Vegas.

This case is being prosecuted by Assistant U.S. Attorney Benjamin Langner.

U.S. Attorney Luger thanked Agents Jonathan Ferris and Ephraim Holmgren of the Minnesota Department of Commerce Fraud Bureau, the United States Postal Inspection Service, and the Internal Revenue Service-Criminal Investigation Division for their assistance with the investigation.

Defendant Information: SEAN MEADOWS, D.O.B. 4/25/1973
Eden Prairie, MN

Charges: • Mail Fraud, 3 counts
• Wire Fraud, 7 counts
• Money Laundering, 1 count
• Transaction Involving Fraud Proceeds, 1 count

The charges contained in the indictment 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 MARKEACE CANTY a/k/a “QUAKE,” 33, to 300 months in federal prison for prostituting a child throughout the Upper Midwest, including in Minnesota, Illinois, Indiana, North Dakota, and Wisconsin. CANTY was indicted on May 6, 2013, and found guilty by a federal jury on September 12, 2013, of Conspiring to Commit Sex Trafficking of a Child, and Sex Trafficking of a Child.

“This defendant sexually trafficked a young woman for his own personal enrichment,” said U.S. Attorney Luger. “Victims of sex trafficking may never fully recover from the harm done to them, and this office will continue to prosecute aggressively those who prey on children.”

Assistant U.S. Attorney Thomas Calhoun-Lopez said: “Markeace Canty reaped great financial rewards by exploiting a child. He used money gained by advertising and selling an underage girl in order to buy personal items like jewelry and a flat-screen television. In doing so, he exposed the victim to physical and psychological harm. The lengthy sentence handed down today clearly demonstrates that, whatever the financial gain, the cost of these crimes is too high.”

As proven at trial and according to documents filed in court, from at least July 2012 through in or about January 2013, CANTY trafficked at least one girl for the purpose of prostitution in at least five states. The defendant placed sexually suggestive advertisements in the “adult entertainment” section of a website called backpage.com. CANTY and the trafficking victim were observed multiple times by law enforcement officials at various hotels in locations for which he had placed ads on backpage.com, including one incident in which she agreed to perform sexual acts with an undercover police officer in exchange for $200. The victim was arrested at least once on suspicion of engaging in prostitution during this time period.

On January 14, 2013, agents from the Federal Bureau of Investigation (FBI) and Grand Forks Police Department executed a search warrant for a hotel room booked in CANTY’S name. Pursuant to federal warrants, agents seized an iPhone belonging to CANTY containing photographs used in backpage.com advertisements linked to the defendant’s cell phone number. Also contained on the iPhone were photographs of CANTY displaying large sums of cash, jewelry, and a flat-screen television.

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

United States Attorney Andrew M. Luger thanked the Federal Bureau of Investigation, Duluth Police Department, Porter County Sheriff’s Department (IN), Grand Forks Police Department (ND), Fargo Police Department (ND), and the Grand Forks Sheriff’s Department (ND), for their assistance with the investigation.

Defendant Information: MARKEACE CANTY a/k/a “QUAKE,” D.O.B. 8/23/1980
Duluth, MN

Convicted: • Conspiring to Commit Sex Trafficking of a Child, 1 count
• Sex Trafficking of a Child, 1 count

Sentenced: • 300 months in prison
• 180 month term of supervised release

 

 

Andrew M. Luger, United States Attorney for the District of Minnesota, today announced the guilty plea of ANTONIO NAVARRO, a/k/a TONY SANCHEZ, 19, to Conspiracy to Distribute Methamphetamine. NAVARRO pleaded guilty before United States District Court Judge John R. Tunheim. NAVARRO was indicted on May 5, 2014, with three co-defendants: JESUS RAMIREZ, 31; JONATAN DELGADO ALVAREZ, 22; and JUAN RICARDO ELENES VILLAVAZO, a/k/a. CHAPO, 32. RAMIREZ and ALVAREZ are in custody and awaiting trial. VILLALVAZO remains unapprehended.

“This case is a powerful example of the violent tactics of drug traffickers,” said U.S. Attorney Luger. “The United States Attorney’s Office in Minnesota, along with our local and federal law enforcement partners, is committed to stopping the flow of illegal drugs into our state, and aggressively prosecuting the violent crime that so often comes with it.”

As set forth by the defendant’s guilty plea, between February 2014, and April 2014, NAVARRO distributed methamphetamine and maintained a house in St. Paul where a large amount of methamphetamine was stored.

According to the indictment, on April 14, 2014, RAMIREZ and ALVAREZ flew from Los Angeles to Minneapolis. Later than evening, the defendants are charged with kidnapping two victims at gunpoint, holding them captive, and beating and making violent threats against their lives that of their families. According to the indictment, VILLAVAZO sliced and nearly severed one of the victim’s fingers.

NAVARRO was arrested at approximately 7:30 p.m. on April 15, 2014. He is expected to be sentenced at a future date. This conviction is the result of an investigation by the Safe Streets Task Force. Safe Streets is a FBI-sponsored task force focused on combating violent street crime, as well as gang and drug- trafficking offenses. This case is being prosecuted by Assistant United States Attorney Jeffrey S. Paulsen.

United States Attorney Andrew Luger thanked the Minneapolis Police Department, and the St. Paul Police Department, for their assistance in the investigation.

 

 

MINNEAPOLIS—Today in federal court, a 27-year-old Mounds View man pleaded guilty to one count of Distribution of Heroin. Andrew Terrell Davis, Jr., who was indicted on May 12, 2014, entered his guilty plea this morning in Minneapolis before United States District Court Chief Judge Michael J. Davis.

According to the plea agreement, the defendant conducted a drug transaction with an undercover police officer in south Minneapolis. The undercover officer gave the defendant $700 and received 5.19 grams of heroin in return from the defendant. On a separate occasion, the defendant conducted a similar drug transaction with the undercover officer wherein the defendant provided 48.15 grams of heroin in exchange for $5,000. On April 17, 2014, law enforcement executed a search warrant of the defendant’s residence and recovered 16 grams of heroin and 56 grams of cocaine.

For his crime, Davis faces a potential maximum penalty of 20 years in federal prison and a supervised release term of three years. Judge Davis will determine his sentence at a future hearing, yet to be scheduled.

This case is the result of an investigation by the Drug Enforcement Administration and the Dakota County Drug Task Force. It is being prosecuted by Assistant U.S. Attorney Richard A. Newberry.

 

 

MINNEAPOLIS—The United States Attorney’s Office announced today that a federal grand jury recently indicted a man on charges of conspiracy and trafficking in counterfeit goods. Brian Todd Gore, 45, of Inver Grove Heights, made his initial appearance on July 11, 2014 before U.S. Magistrate Judge Jeanne J. Graham.

The indictment alleges that from November 2009 through September 2012, Gore conspired with other individuals to traffic in goods, specifically counterfeit sports jerseys, imported from China. As part of the alleged conspiracy, Gore would order the counterfeit sports jerseys from suppliers in China, have them delivered to him in the United States, and then sell them to Co- conspirator A with the knowledge that the counterfeit jerseys would be sold to the public.

During this time, Co-conspirator A possessed hundreds of counterfeit sportswear items in his retail store in Roseville, Minnesota, some of which he had purchased from the defendant. The indictment further alleges that the defendant transported hundreds of counterfeit jerseys in his van and stored counterfeit jerseys at his residence in Inver Grove Heights, Minnesota and in a leased storage unit in Des Moines, Iowa.

In February 2010, the defendant traveled to Miami, Florida, the location of the 2010 NFL Super Bowl, to sell counterfeit NFL jerseys. During that time, the defendant allegedly possessed approximately 383 counterfeit NFL jerseys and two DHL shipping receipts showing packages sent from China to Fort Lauderdale, Florida. The defendant and Co-conspirator B also allegedly possessed approximately 70 counterfeit NFL jerseys at an apartment where they were temporarily residing in Fort Lauderdale.

United States Attorney Andrew Luger praised the work of federal agents from Homeland Security Investigations, stating “I am pleased that HSI is pursuing these counterfeit cases. We will prosecute those who traffic in counterfeit goods aggressively.”

“Trafficking in counterfeit goods is not a victimless crime,” said Special Agent in Charge J. Michael Netherland of HSI St. Paul. “Buying these items may appear at first to be a bargain, but when we take into account how the money it generates is often tied to organized crime or worse, we see that this 'victimless crime' harms us all in the long run."

If convicted, Gore faces a potential maximum penalty of 10 years in prison and a $2 million fine. All sentences are ultimately determined by a federal district court judge.

This case is being investigated by Homeland Security Investigations (“HSI”) and the Coalition to Advance the Protection of Sports Logos (“CAPS”). It is being prosecuted by Assistant United States Attorney Sarah E. Hudleston.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS— A federal grand jury has recently returned an indictment charging four men in connection with the Split Rock Realty mortgage fraud investigation. On July 9, 2014, Thomas Edward Rosensteel III, 41, of Excelsior, Robert Scott “Rod” Aslesen, 65, of Little Canada, Justin Joseph Christenson, 34, of East Bethel, and Dale Russell Wurzinger, 57, of Burnsville, were each charged with eight counts of Wire Fraud and one count of Conspiracy to Commit Wire Fraud.

The four defendants allegedly participated in a scheme to defraud mortgage lenders in connection with the sale of excess unsold builder inventories of residential real estate. The scheme allegedly involved recruiting purchasers to buy properties at inflated prices, falsifying loan applications and other documents, fronting down payments for purchasers, and paying kickbacks to the purchasers outside of closing. The indictment alleges that the defendants concealed the fronted down payments and kickbacks from the lenders. United States Attorney Andrew Luger stated, “The allegations in this indictment illustrate a sophisticated scheme carried out by licensed professionals in the real estate industry. We have been working closely with the FBI and the Minnesota Department of Commerce Fraud Bureau to bring charges against these four individuals who used their knowledge and position to take advantage of the system.”

"The Commerce Department takes very seriously its job to stop fraud by licensed professionals, and to protect the public from these kinds of crimes,” said Commerce Commissioner Mike Rothman. “These criminal charges result from a thorough investigation done by the Commerce Fraud Bureau and FBI, in tandem with the U.S. Attorney's Office, and should send a strong message that when laws are broken, there will be tough consequences.”

Three other individuals have already pleaded guilty to criminal charges in connection with this scheme and are awaiting sentencing. They are Amri Elsafy, 42, of Brooklyn Park; Gerald Edwin Carlson, 67, of Kennedy, Minnesota; and James Bryan Crook, 58, of Brooklyn, New York.

If convicted, the defendants face a potential maximum penalty of 30 years in prison on each count. All sentences are ultimately determined by a federal district court judge.

This case is the result of an investigation by the Federal Bureau of Investigation and the Minnesota Department of Commerce Fraud Bureau. It is being prosecuted by Assistant U.S. Attorney William J. Otteson.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS— Recently in federal court, four defendants were charged with heroin distribution in two separate indictments. The first indictment charges Francisco James Bell, 38, of Madison, WI, with two counts of Distribution of Heroin.

Count One of the indictment alleges that on May 20, 2014, Bell distributed approximately 50 grams of heroin. Count Two alleges that on May 30, 2014, Bell distributed approximately 100 grams of heroin. According to an affidavit filed in court, surveillance officers recorded both drug transactions which took place between Bell and a cooperating individual (CI) in a McDonald’s parking lot in Duluth. Bell faces a potential maximum penalty of 40 years in prison. This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”).

The second indictment charges three Minneapolis men in a separate heroin distribution conspiracy. Darnell Travor King, 35, Latese Capree Hudson, 25, and James Purnell Thomas, 43, were charged with one count of Conspiracy to Distribute Heroin and one count of Possession with Intent to Distribute over 500 grams of Heroin. The indictment includes three forfeiture allegations related to the drug charges. Upon conviction of either of the counts, the defendants would forfeit $20,455 in U.S. currency seized during a search of the defendants’ apartment, along with a Ruger 9mm semi-automatic pistol and a Smith and Wesson .40 caliber pistol. The three defendants face a potential maximum penalty of 40 years in prison. This case is being investigated by the Drug Enforcement Administration (“DEA”) and the Hennepin County Sheriff’s Office.

“The U.S. Attorney’s Office and our law enforcement partners are committed to combating heroin trafficking in our state. We will continue working together to prosecute distributors who bring heroin into our communities,” said United States Attorney Andrew Luger.

These cases are being prosecuted by Assistant U.S. Attorney Jeffrey S. Paulsen.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS — Last week in federal court, a 42-year-old Northfield man pleaded guilty to one count of Distribution of Child Pornography. Charles Edward Bracken, who was indicted on October 8, 2013, entered his guilty plea before United States District Judge Richard H. Kyle on July 2, 2014.

In his plea agreement, Bracken admitted that on September 16, 2010, he distributed a computer image depicting two minor boys engaged in sexually explicit conduct. The defendant also admitted that he possessed on his laptop computer approximately 21,541 images and more than 574 videos of child pornography, some of which portrayed sadistic or masochistic conduct or other depictions of violence. The defendant distributed these images through an Internet file- sharing program.

For his crime, Bracken faces a possible maximum sentence of 20 years in federal prison. Judge Kyle will determine his sentence at a future hearing, yet to be scheduled.

This case is the result of an investigation by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Karen B. Schommer.

This case was brought as part of Project Safe Childhood (“PSC”), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney offices and the Justice Department’s Criminal Division, Child Exploitation and Obscenity Section, PSC marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children and identify and rescue victims. For more information about PSC, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab “resources.”

 

 

MINNEAPOLIS— Last week in federal court, a man pleaded guilty to submitting false tax returns to the Internal Revenue Service. On July 1, 2014, Dusten Lee Barth pleaded guilty to one count of False Claims and one count of Aggravated Identity Theft. Barth, who was indicted on March 3, 2014, entered his guilty plea before United States District Court Judge Paul A. Magnuson.

According to the plea agreement, Barth admitted to preparing and submitting approximately 10 fraudulent tax returns to the Internal Revenue Service (“IRS”), claiming over $43,000 in false tax refunds. The defendant also admitted to using the identities of several other individuals to submit a false tax return in their names.

For his crimes, Barth faces a potential maximum penalty of five years in federal prison and a fine of up to $250,000 for the False Claims count and a two year mandatory, consecutive prison sentence for the Aggravated Identity Theft count Judge Magnuson will determine his sentence at a future hearing, which is yet to be scheduled.

This case is the result of an investigation by the IRS Criminal Investigation Division. It is being prosecuted by Assistant U.S. Attorney Surya Saxena.

Per U.S. Department of Justice policy, the U.S. Attorney’s Office is not allowed to provide the age and city of residence for defendants charged in criminal tax cases.

 

 

MINNEAPOLIS—Today in federal court, a 52-year-old Loretto man pleaded guilty to felony false statements in connection with prevailing wage violations. Jeffrey John Plzak was charged on June 17, 2014, and entered his plea this morning in Minneapolis before United States District Court Judge Patrick J. Schiltz.

As set forth in the plea agreement, Plzak and his spouse run Honda Electric, Inc., a company based in Loretto, Minnesota. Honda Electric bids on construction projects, including highway and road projects, that are federally and state funded. Many of the projects Plzak bid on required that Honda Electric pay its electricians and other laborers the prevailing wage rate.

On numerous occasions, Plzak won bids based in part on the representation that Honda Electric employees working on the project would receive prevailing wage. Those projects required periodic submission by Honda Electric of a certified payroll report. In those reports, Plzak knew Honda Electric, at his direction, was representing to the United States Department of Transportation – Federal Highway Administration and to the Minnesota Department of Transportation that Honda Electric’s employees were being paid the required prevailing wage.

In fact, as Plzak knew, in many instances employees were being paid less than half of the prevailing wage rate. In total, Plzak admitted that over a series of projects between 2010 and 2013, Honda Electric underpaid its employees over $271,000.

For example, Plzak admitted that in a certified payroll report dated September 24, 2010, Honda Electric stated it was paying prevailing wage on a federally funded project in Ramsey County, when, in fact, he knew the employees were receiving far less than prevailing wage.

“When contractors lie about paying prevailing wage, workers, competitors, and taxpayers all lose,” said United States Attorney Andrew M. Luger. “Workers are underpaid, competitors who played by the rules are underbid, and the wrongdoer makes off with taxpayer dollars meant for honest employers. We thank the outstanding work done by the Minnesota Department of Transportation and the FBI in investigating these and other prevailing wage violations.”

As a result of his plea, Plzak faces up to five years in prison, repayment of unpaid wages, and a fine of up to $250,000 or twice the loss amount, whichever is greater. Plzak will be sentenced at a later date.

This case is the result of an investigation by the Minnesota Department of Transportation’s Labor Compliance Unit and the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney David M. Genrich.

 

 

MINNEAPOLIS— Recently in federal court in Duluth, a Hibbing man was sentenced for damaging property belonging to the Fortune Bay Casino on the Bois Forte Indian Reservation. United States District Court Judge John R. Tunheim sentenced Shane Alan Simonson, age 26, to 18 months in federal prison on June 27, 2014. Simonson, who was indicted on August 21, 2013, pleaded guilty on December 12, 2013 to one count of Criminal Damage of Property in the First Degree.

In his plea agreement, Simonson admitted to damaging physical property belonging to the Bois Forte Band of Chippewa. Specifically, on the morning of May 9, 2013, Simonson took a large Band-owned snow plow truck, without permission to operate or possess the truck, and drove it into a maintenance shed, causing significant damage. Simonson then used the snow plow to damage a parking lot barricade and gate, as well as the green of the Fortune Bay Casino’s 11th hole.

In addition to the 18-month term of imprisonment, Judge Tunheim ordered Simonson to pay $68,983 in restitution, the full amount of loss suffered by the Fortune Bay Casino and the Bois Forte Band of Chippewa.

This case was the result of an investigation by the Federal Bureau of Investigation and the Bois Forte Police Department. It was prosecuted by Assistant U.S. Attorney Katharine T. Buzicky.

 

 

MINNEAPOLIS— Today in federal court, United States District Court Judge Ann D. Montgomery sentenced Ieisha Smith to 24 months in federal prison for devising and executing a scheme to defraud the Internal Revenue Service (“IRS”) by filing fraudulent tax returns for clients. Smith, who was indicted on December 3, 2012, pleaded guilty on May 29, 2014 to one count of False Claims.

In her plea agreement, Smith admitted that she began the scheme in February 2009, when individuals came to her home for assistance in filing their income taxes. Specifically, she filed false tax returns on their behalf and in those returns falsely claimed that taxes had been withheld and refunds were due, all of which she knew to be false. In the scheme, Smith attempted to steal $765,137 from the IRS. The IRS incurred an actual loss of $362,246.

This case was the result of an investigation by the IRS-Criminal Investigation. It was prosecuted by Assistant U.S. Attorney Thomas Calhoun-Lopez.

According to the IRS, approximately 60 percent of taxpayers use tax professionals to prepare and file their tax returns, with these paid preparers now collectively responsible for more than 80 million individual tax returns annually. “Tax return preparer fraud” is one of the IRS’s “Dirty Dozen Tax Scams.” For more information about the fight against tax fraud or how to choose a reliable tax return preparer, visit http://www.irs.gov/uac/Tips-for-Choosing-a-Tax-Return- Preparer.

Per U.S. Department of Justice policy, the U.S. Attorney’s Office is not allowed to provide the age and city of residence for defendants charged in criminal tax cases.

 

 

MINNEAPOLIS — Yesterday in federal court, a 32-year-old Princeton man pleaded guilty to one count of Distribution of Child Pornography. William C. E. Strobel, who was indicted on February 19, 2014, entered his guilty plea before United States District Judge Donovan W. Frank.

In his plea agreement, Strobel admitted that between February 2010 and December 2011 he accessed a peer-to-peer file sharing program and traded images and videos depicting the sexual exploitation of children. The defendant also admitted that he possessed on his computers and other digital media more than 20,000 images and more than 600 videos depicting minors, including children under the age of 12, engaged in sexually explicit conduct.

For his crime, Strobel faces a possible maximum sentence of 40 years in federal prison. Judge Frank will determine his sentence at a future hearing, yet to be scheduled.

This case is the result of an investigation by the Federal Bureau of Investigation and the Princeton Police Department. It is being prosecuted by Assistant United States Attorney Karen B. Schommer.

This case was brought as part of Project Safe Childhood (“PSC”), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney offices and the Justice Department’s Criminal Division, Child Exploitation and Obscenity Section, PSC marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children and identify and rescue victims. For more information about PSC, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/resources.html and click on the tab “resources.”

 

 

MINNEAPOLIS— Yesterday in federal court, United States District Court Judge Donovan Frank sentenced a 35-year-old Minneapolis man to 120 months in federal prison, followed by five years of supervised release, for conspiring to distribute marijuana and money laundering. A United States grand jury indicted Irineo Serio Moreno on March 4, 2013, on the drug charge. On July 8, 2013, the United States Attorney filed an Information charging Moreno with the money laundering charge. On July 12, 2013, Moreno agreed to plead guilty to both charges.

In his plea agreement, Moreno admitted that from at least January 2009 through December 20, 2012, he conspired with Ryan Timothy Solon, Christopher David Schumacher, Shawn Andrew Withrow, Jeremy Allen Anderson, Corey William Johns, Arthur Eugene Johns, and Matthew Ryan Waste to distribute 1000 kilograms of marijuana from California to Minnesota. In addition, Moreno admitted that he owned land in Northern California where he operated a marijuana grow farm, hiring and paying others to tend to the marijuana plants. Some of the marijuana from that farm was distributed in Minnesota.

Moreno also admitted to laundering the proceeds from the sale of the marijuana by purchasing assets including a Polaris UTV (an off-road utility task vehicle) and a trailer for $17,442.

As part of his plea agreement, Moreno agreed to forfeit to the United States the land in California and a 1999 Chevrolet Tahoe.

This case was the result of an investigation by IRS- Criminal Investigation and the United States Drug Enforcement Administration. It was prosecuted by Assistant United States Attorney LeeAnn Bell.

 

 

MINNEAPOLIS—The United States Attorney’s Office announced today that a federal grand jury indicted a man on a variety of charges stemming from an identity theft, bank fraud, wire fraud, and tax fraud conspiracy. Six additional co-conspirators were charged via Information for their roles in the conspiracy.

Christopher Lindsey, the individual who allegedly orchestrated the conspiracy, was arrested today and charged in a 23-count indictment. Specifically, Lindsey was charged with one count of Conspiracy to Commit Bank and Wire Fraud, 12 counts of Bank Fraud, three counts of Wire Fraud, four counts of Aggravated Identity Theft, one count of Conspiracy to Defraud the United States, and two counts of submitting False Claims for Refunds. Eric Childs was charged with one count of Conspiracy to Commit Bank and Wire Fraud. Nicole Shantelle Ashton, Monta Dormus Davis, Quentin Nathaniel Durr, Joanetta Joyce Robinson, and Tramaine Michael Smith each face one count of Conspiracy to Commit Bank Fraud.

According to the 23-count indictment: From October of 2002 until December of 2013, Lindsey allegedly coordinated an elaborate check fraud scheme as well as a fraudulent tax return scheme. As part of the alleged check fraud scheme, Lindsey obtained legitimate bank account information, including names and addresses of businesses and individuals, bank routing and account numbers, check numbers, and signatures, from a variety of sources, including approximately 20,000 stolen checks that had already been negotiated as part of legitimate transactions. Lindsey then used that information in the creation of counterfeit checks. Lindsey, and other members of the conspiracy, would then negotiate the counterfeit checks at various financial institutions and businesses throughout the Twin Cities area. The total intended and actual loss for the counterfeit check scheme that Lindsey and his conspirators carried out was more than $1 million.

Also during this time, Lindsey allegedly executed a conspiracy to submit false claims to the IRS. Lindsey and other conspirators recruited individuals to file false and fraudulent tax returns with the IRS. Lindsey would create false and fraudulent Form W-2s for those individuals, in which he combined the correct information of his conspirators, including names, dates of birth, and social security numbers, along with false information regarding employment, earnings, and withholdings. As a result of these actions, Lindsey and his conspirators caused the IRS to issue fraudulent income tax refunds.

These fraudulent refunds were then loaded onto debit cards issued to the conspirators who had filed the fraudulent returns. The conspirators, in turn, provided the debit cards to Lindsey, who then used the debit cards at ATMs to make cash withdrawals. The conspiracy involved the submission of more than 40 fraudulent claims seeking refunds totaling more than $270,000.

If convicted, Lindsey faces a potential maximum penalty of 30 years in prison for conspiring to commit bank and wire fraud, bank fraud and wire fraud, and a mandatory minimum sentence of two years on each count of aggravated identity theft. Lindsey also faces a potential maximum penalty of 10 years in prison for conspiring to defraud the United States and a potential maximum penalty of five years in prison for false claims for refunds. All sentences are ultimately determined by a federal district court judge.

United States Attorney Andrew M. Luger stated that, “The crimes charged in this case have a real impact on our community and economy. Because of the nature of this organization and its crimes, the defendants were able to support their criminal network for more than ten years. Because of the great work of the Minnesota Financial Crimes Task Force, and the strong law enforcement partnerships that are central to its operation, these defendants are being held to account for their crimes.”

This case is the result of an investigation led by the Minnesota Financial Crimes Task Force, which was established pursuant to state law. The task force investigates financial crimes related to identity theft, with a special emphasis on organized criminal enterprises. It is comprised of local, state, and federal law enforcement investigators dedicated to combating the growing trend of cross-jurisdictional financial crimes.

“This investigation came together as a result of the partnerships between agencies and the extraordinary efforts of all involved working under the umbrella of the Minnesota Financial Crimes Task Force and is an example of successful collaboration of local, state, and federal criminal justice agencies,” said Patrick Henry, Commander of the Minnesota Financial Crimes Task Force.

The Minnesota Financial Crimes Task Force serves the entire District of Minnesota, presenting its cases to county or federal prosecutors, as appropriate. Its participants include the U.S. Secret Service, the U.S. Postal Inspection Service, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Internal Revenue Service-Criminal Investigations Division, the Minneapolis Police Department, the St. Paul Police Department, the Edina Police Department, the Duluth Police Department, the Ramsey County Sheriff’s Office, the Mille Lacs County Sheriff’s Office, and the Minnesota Bureau of Criminal Apprehension.

“IRS-Criminal Investigation, along with our law enforcement partners and the U.S. Attorney’s Office, remain vigilant in our duty to protect the honest taxpayers of this country by diligently investigating identity theft and refund fraud crimes and holding those accountable who defraud the government and hurt innocent taxpayers,” stated Rick Goss, St. Paul Field Office Acting Special Agent in Charge of IRS-Criminal Investigation.

Louis Stephens, Special Agent in Charge of the local office of the United States Secret Service added, “These individuals are well versed in using identity theft to commit bank fraud and other types of financial crimes. This type of crime continues to increase in complexity and the impact on our economy and communities throughout Minnesota, especially the greater Twin Cities area, grows each year. Identity theft and related crimes are the crime wave of today and will continue to be in the future. Criminal conspiracies such as this are extremely difficult to investigate because they are hierarchical in nature and commit their crimes across jurisdictional lines in an effort to frustrate law enforcement’s ability to track them and associate their crimes. The Minnesota Financial Crimes Task Force is a force multiplier that enables the combined resources of federal, state, and local law enforcement to pool our resources and maximize each agency’s expertise to more effectively combat this type of crime.”

This case is being prosecuted by Assistant United States Attorney Lola A. Velazquez-Aguilu.

The charges contained in an indictment are mere allegations and defendants are presumed innocent unless and until proven guilty.

 

 

MINNEAPOLIS—Recently in federal court, a jury found a Minneapolis man guilty of smuggling guns to Nigeria and lying on required federal firearms purchase records. Sheriff Olaleran Mohammed, 51, a naturalized U.S. citizen currently living in Brooklyn Park, was convicted on Monday of one count of Smuggling Goods from the United States and 17 counts of providing False Statements During the Purchase of a Firearm. Mohammed was indicted in October 15, 2013 and was arrested November 22, 2013 in Atlanta, when returning from Nigeria. His trial before United States District Court Judge Susan Richard Nelson began June 11, 2014 and concluded Monday.

“Gun smuggling overseas is a serious offense our office will pursue aggressively,” said U.S. Attorney Andrew Luger. “I am pleased with the jury’s verdict and with the hard work that led to that verdict.”

The investigation began in the fall of 2012 when agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) discovered seven handgun purchases were made within days of each other at a gun shop in the western suburbs of the Twin Cities. Investigators eventually discovered Mohammed had made a total of 17 handgun purchases between 2009 and 2012. ATF investigators suspected there was a high likelihood Mohammed had lied on at least some of the firearms purchase forms, which are required by U.S. law to legally purchase weapons from a federally licensed firearms dealer.

Agents of Homeland Security Investigations (HSI) determined Mohammed was engaged in the international export business and that he frequently traveled to Nigeria, which raised further questions about the unusual number of purchases.

In December 2012, HSI agents further discovered that Mohammed was shipping a vehicle to Nigeria via ocean container through Valencia, Spain and suspected at least some of the weapons were hidden inside.

HSI agents contacted Spanish law enforcement officers in Madrid who halted the shipment, inspected the vehicle and discovered seven 9 mm, and one .22 caliber handguns hidden within the vehicle. The firearms were seized by Spanish authorities and later turned over to U.S. authorities for use in Mohammed’s criminal proceedings.

Mohammed faces a potential maximum penalty of 10 years in prison on each count. Judge Nelson will determine his sentence at a future hearing, yet to be scheduled.

This conviction is the result of a joint investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). This case is being prosecuted by Assistant United States Attorney Thomas Calhoun-Lopez.

 

 

MINNEAPOLIS — Today in federal court, a jury returned guilty verdicts on all three counts of an indictment charging Robert David Boedigheimer, 51, of Stillwater, with one count of Conspiracy to Commit Money Laundering, one count of Money Laundering, and one count of making a False Statement to an IRS Agent. Boedigheimer, a St. Paul attorney, was indicted on December 10, 2013.

Boedigheimer conspired with Brandon Lusk, his brother-in-law, a marijuana dealer based in southem Minnesota to launder the proceeds from the sales of marijuana. Lusk pleaded guilty in October 2011 to one count of conspiracy and one count of conspiracy to commit money laundering. Lusk admittedly formed a company called Rochester Reliable Rentals, which acquired nine Rochester properties. Lusk knowingly financed improvements and renovations to those properties with proceeds of the marijuana conspiracy through the assistance of Boedigheimer. Brandon Lusk, along with Richard Kay of Rochester and others conspired to distribute more than 1000 grams of marijuana. Kay was sentenced to 200 months in prison and Lusk is currently awaiting sentencing.

Prosecutors are very pleased with the verdict. Assistant United States Attorney Steven L. Schleicher stated, “This case needed to be prosecuted because as a practicing lawyer, the defendant abused the trust that society places on the practice of law by laundering drug money through his law firm and obstructing a federal investigation.”

Boedigheimer faces a potential maximum penalty of 20 years in prison on the conspiracy count, 10 years on the money laundering count, and five years on the false statements count. All sentences will be determined by a federal district court judge.

This case is the result of an investigation by the Internal Revenue Service- Criminal Investigation Division, the Minnesota Bureau of Criminal Apprehension, the Drug Enforcement Administration, the Southeast Minnesota Narcotics and Gang Task Force (SEMNGTF), and the Wabasha County Sheriff’s Office. It is being prosecuted by Assistant U.S. Attorneys Steven L. Schleicher and Julie E. Allyn.

 

 

MINNEAPOLIS — Yesterday in federal court, a 38-year-old Claremont man was sentenced for conspiring to distribute methamphetamine and illegal firearms possession. United States District Court Judge Richard H. Kyle sentenced Clancy Shane Amy to 78 months in federal prison, followed by five years of supervised release. Amy, who was indicted on May 6, 2013, pleaded guilty to one count of Conspiracy to Distribute Methamphetamine as well as one count of Using and Carrying a Firearm During and in Relation to a Drug Trafficking Offense.

In his plea agreement, Amy admitted that from at least August 2012 through March 2013, he conspired with others to distribute methamphetamine from Texas to areas within southeastern Minnesota. Amy admitted that his actions were part of a larger drug distribution enterprise which was operated by multiple conspirators between Minnesota and other areas of the United States. Further, Amy admitted that during a law enforcement search of his home on April 16, 2013, agents found various items associated with the distribution of methamphetamine, including 112 grams of methamphetamine packaged in multiple plastic baggies as well as multiple firearms. Amy also admitted that he possessed one of the firearms for security and protection in his drug distribution efforts – namely a Browning .22 caliber semi-automatic handgun found in a bedroom safe with some of the recovered methamphetamine and U.S. currency.

This case was the result of an investigation by the Minnesota Bureau of Criminal Apprehension, the Drug Enforcement Administration, the South Central Drug Investigation Unit, and the Southeast Minnesota Narcotics and Gang Task Force. It was prosecuted by Assistant United States Attorney Allen A. Slaughter.

 

 

MINNEAPOLIS — Earlier this week in federal court, a 31-year-old St. Paul man pleaded guilty to one count of Possession of a Stolen Firearm. Michael Anthony Vargas, who was charged via an Information on May 3, 2014, entered his guilty plea on June 3, 2014 before United States District Court Judge Joan N. Ericksen.

In his plea agreement, Vargas admitted that on January 8, 2014, he possessed a stolen Smith & Wesson 9-millimeter pistol, which was recovered during a traffic stop by the St. Paul Police Department.

For his crime, Vargas faces a potential maximum penalty of 10 years in federal prison. Judge Ericksen will determine his sentence at a future hearing, yet to be scheduled.

This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Saint Paul Police Department. It is being prosecuted by Assistant United States Attorney LeeAnn K. Bell.

 

 

MINNEAPOLIS — Earlier this week in federal court, a 21-year-old Mizpah man was sentenced for his role in the robbery of the First State Bank of Bigfork in Kelliher, Minnesota on December 10, 2012. On June 3, 2014, United States District Court Judge Donovan W. Frank sentenced Cody Lowell Troy to 120 months in federal prison, followed by 5 years of supervised release. Troy, who was indicted along with a co-defendant on January 15, 2013, pleaded guilty to one count of Brandishing a Firearm During a Crime of Violence.

In his plea agreement, Troy admitted to robbing the bank while brandishing a 12-gauge, sawed-off shotgun that had a partially obliterated serial number. He stole approximately $3,738.

This case was the result of an investigation by the Federal Bureau of Investigation, the Beltrami County Sheriff’s Office, the Headwaters Safe Trails Task Force, and the Minnesota Bureau of Criminal Apprehension. It was prosecuted by Assistant U.S. Attorneys Manda M. Sertich and Kevin S. Ueland.

 

 

MINNEAPOLIS—Today in federal court, a 25-year-old St. Paul man was charged by Complaint with sex trafficking of a minor and conspiracy to commit sex trafficking of a minor. Dontre D’Sean McHenry made his initial appearance this afternoon before United States Magistrate Judge Jeanne J. Graham. McHenry was temporarily detained and a final detention hearing is scheduled for tomorrow before Judge Graham.

According to allegations in the Criminal Complaint, between February 25, 2014 and June 4, 2014, McHenry engaged in criminal sex trafficking by exploiting three minor females and causing them to engage in commercial sex acts by force, threats of force, fraud, or coercion for the defendant’s profit.

A law enforcement affidavit filed in the case alleges that McHenry would communicate with “johns” or potential “johns” via text messages and online chat rooms to arrange commercial sex with three minor females.

On March 12, 2014, officers responded to a Backpage.com advertisement thought to be that of a juvenile sex trafficking victim. The information from the advertisement led investigators to the Motel 6 in Roseville where McHenry was found inside a hotel room with a 17-year-old female. Further investigation revealed that McHenry had also recruited a 15-year old female and a 16-year-old female for the purpose of engaging in commercial sex acts.

United States Attorney Andrew M. Luger stated that, “the allegations in the Complaint set forth a sophisticated, ongoing criminal sex trafficking business run by McHenry. The exploitation of minors for commercial sex will not be tolerated by this Office or our law enforcement partners.”

“Protecting our communities from those who engage in human trafficking is a top priority for Homeland Security Investigations,” said Special Agent in Charge J. Michael Netherland of the HSI St. Paul Division Office. “HSI is committed to working with our federal, state, and local law enforcement partners to investigate human trafficking, as well as working with community and faith-based organizations to identify, rescue, and assist victims of trafficking."

If convicted, McHenry faces a potential minimum sentence of 10 years in federal prison and a maximum of life imprisonment. All sentences are ultimately determined by a federal district court judge.

This case is the result of an investigation by Homeland Security Investigations, the St. Paul Police Department, the Minneapolis Police Department, the Rochester Police Department, and the Roseville Police Department. This case is being prosecuted by Assistant United States Attorney Laura M. Provinzino.

In 2012, Yuri Fedotov, the head of the United Nations’ Office on Drugs and Crime reported to those attending a U.N. General Assembly meeting that an estimated 2.4 million people worldwide are victims of human trafficking at any one time, with 80 percent of them being exploited as sex slaves. He also said approximately $32 billion is earned collectively every year by the criminals who operate human trafficking networks. The U.S. Department of Justice reports that an estimated 14,500 to 17,500 people are trafficked within the U.S. alone each year.

For more information, visit http://www.ice.gov/human-trafficking/

The charges contained in a criminal complaint are mere allegations and defendants are presumed innocent unless and until proven guilty.

 

 

MINNEAPOLIS — Last week in federal court, a 47-year-old St. Paul man pleaded guilty to robbing two banks. Maurice Dixon specifically pleaded guilty to two counts of Bank Robbery. Dixon, who was indicted on December 17, 2013, entered his guilty plea before United States District Court Judge John R. Tunheim on May 29, 2014.

In his plea agreement, Dixon admitted that on November 4, 2013, he walked into the University Avenue branch of TCF Bank in St. Paul and gave a teller a note demanding money. Following the robbery, an audit conducted by TCF Bank determined that the bank had suffered a loss of $768. Dixon also admitted that on November 9, 2013, he robbed the Lexington Parkway North branch of TCF Bank in the same manner. Following the robbery, Dixon was apprehended a short distance from the bank. When the defendant was taken into custody, he was found to have $175 on his person.

In addition to the November 4 and November 9 bank robberies, Dixon also admitted that he robbed another TCF Bank in Minneapolis on November 5, and between October 10, 2013 and November 9, 2013, engaged in a robbery spree where he robbed several retail establishments, including numerous Subway locations, a White Castle, and a Little Caesar’s Pizza restaurant.

“These repeated robbery cases are particularly troublesome,” stated United States Attorney Andrew M. Luger. “I am pleased that police were able to connect these robberies and end the defendant’s spree.”

This case is the result of an investigation by the St. Paul Police Department, the Minneapolis Police Department, the Woodbury Police Department, the Roseville Police Department, and Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Kevin S. Ueland.

 

 

MINNEAPOLIS— Earlier this week in federal court, a 28-year-old man was sentenced for transporting a minor to engage in prostitution. On June 2, 2014, United States District Court Judge Richard H. Kyle sentenced Napoleon Long, Jr. to 180 months in federal prison on one count of Transportation With Intent to Engage in Prostitution. Long was indicted on April 10, 2013 and pleaded guilty on July 11, 2013.

In his plea agreement, Long admitted that in or about October 2011, he transported a 17- year-old girl from Minnesota to Colorado Springs, Colorado, with the intent that she engage in prostitution. Long also admitted knowing the girl was 17, and that she engaged in at least one sexual act while in Colorado and a pattern of sexual activity while working as a prostitute for him.

United States Attorney Andrew M. Luger stated that his Office was pleased with the sentence in this case. “Those such as this defendant, who profit by using underage girls in commercial sexual activity, will be prosecuted aggressively by this Office.”

This case was the result of an investigation by the Anoka County Sheriff’s Office and the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant U.S. Attorneys David P. Steinkamp and Manda M. Sertich.

In 2012, Yuri Fedotov, the head of the United Nations’ Office on Drugs and Crime reported to those attending a U.N. General Assembly meeting that an estimated 2.4 million people worldwide are victims of human trafficking at any one time, with 80 percent of them being exploited as sex slaves. He also said approximately $32 billion is earned collectively every year by the criminals who operate human trafficking networks. The U.S. Department of Justice reports that an estimated 14,500 to 17,500 people are trafficked within the U.S. alone each year.

For more information, visit http://www.ice.gov/human-trafficking/

 

 

MINNEAPOLIS — A federal grand jury has recently returned indictments charging four St. Cloud men with illegally possessing guns. On May 21, 2014, Darron Israel Shelton, Quontrell Martell Banner, and Kenneth Melvin Vinson were each charged with one count of being a Felon in Possession of a Firearm. That same day, through a separate indictment, Gregory Wimberly, Jr. was charged with two counts of being a Felon in Possession of a Firearm.

The first indictment alleges that on February 2, 2014, authorities found Shelton, Banner, and Vinson to be in possession of two guns, one C.G. Haenel .25 caliber pistol and a Bersa Thunder 9, 9 millimeter, semi-automatic pistol.

Shelton’s prior felony convictions include a drug offense, robbery, and assault. Banner has two prior robbery convictions and a drug conviction. Vinson’s prior felonies include assault, terroristic threats, and a drug conviction.

The second indictment alleges that on May 10, 2013, Wimberly was found to be in possession of a Kel-Tec 9 millimeter, semi-automatic pistol, and on March 7, 2014, he was allegedly found to be in possession of a Smith & Wesson 9 millimeter, semi-automatic pistol. Wimberly has a prior felony drug conviction.

Because the four defendants are convicted felons, they are prohibited under federal law from possessing firearms or ammunition at any time. Because of their extensive criminal history, Shelton and Banner each face a 15-year mandatory minimum sentence if convicted of the charges. Vinson and Wimberly each face a potential maximum sentence of 10 years in prison on each possession count. A federal district court judge will ultimately decide upon the appropriate sentences.

United States Attorney Andrew Luger stated that, “Our Office is working closely with law enforcement in the St. Cloud area to prosecute violent felons who are illegally possessing weapons. These cases are a significant step forward in that effort.”

These cases are the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the St. Cloud Police Department, the Waite Park Police Department, and the Central Minnesota Violent Offenders Task Force. They are being prosecuted by Assistant United States Attorneys Amber M. Brennan and Richard A. Newberry.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS— Today in federal court, a 34-year-old Fresno, California woman was arraigned for interfering with a Delta Airlines flight crew. Brandi Kristine Poulsen was charged by indictment with three counts of Interference with a Flight Crew and Attendants and one count of Assault of a Fellow Passenger.

On February 7, 2014, Poulsen was on board Delta flight 1189 travelling from Baltimore to Salt Lake City. According to the indictment, the defendant made threats against the lives of crew members, and assaulted one crew member and a passenger. The alleged offense caused the unscheduled landing of the airliner at the Minneapolis-St. Paul airport.

The maximum penalty for Interference with a Flight Crew and Attendants is 20 years’ imprisonment, as well as possible fines. All sentences are ultimately determined by a federal district court judge.

This case is the result of an investigation by the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Katharine T. Buzicky.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS — Yesterday in federal court, a 26-year-old felon from St. Paul was sentenced for possessing a nine-millimeter semi-automatic handgun. United States District Court Judge Patrick J. Schiltz sentenced Gary James Rolfer, Jr. to 63 months in federal prison, followed by three years of supervised release, for one count of being a felon in possession of a firearm. Rolfer was indicted on August 5, 2013, and pleaded guilty on October 3, 2013.

According to the plea agreement, while responding to a “shots fired” call near a St. Paul residence, police officers observed Rolfer riding in a vehicle and holding a handgun outside of the front passenger window. During a subsequent pursuit and traffic stop, officers found an unspent nine-millimeter round in the front passenger door, but did not find the handgun. After backtracking the route taken by the vehicle, the officers found the nine-millimeter Smith & Wesson semi-automatic handgun in a back yard. Subsequent investigation found that the firearm was stolen.

Because Rolfer is a convicted felon, he is prohibited from possessing a firearm at any time. His felony records include a Ramsey County conviction for a controlled substance crime in 2005; a Hennepin County conviction for fleeing a police officer in a motor vehicle in 2005; and a Ramsey County conviction for criminal damage to property in 2006.

This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Saint Paul Police Department. It was prosecuted by Assistant United States Attorney Allen A. Slaughter.

 

 

MINNEAPOLIS — Today in federal court, a 30-year-old Little Falls man pleaded guilty to conspiring to distribute methamphetamine. James Kelly Benson specifically pleaded guilty to one count of Conspiracy to Distribute Methamphetamine. Benson, who was indicted on February 12, 2014, entered his guilty plea before United States District Court Judge Donovan W. Frank.

In his plea agreement, Benson admitted that he had been working with others to distribute methamphetamine since June of 2012. Officers of the Central Minnesota Violent Offender Task Force (CMVOTF) also observed Benson selling methamphetamine.

On January 16, 2014, FBI agents, working with CMVOTF officers, executed a search warrant at Benson’s home; they found approximately 60 grams of methamphetamine in Benson’s garage, which he admitted to purchasing with the intent to distribute it within the state of Minnesota.

Because Benson was convicted in Meeker County of a separate felony drug offense in 2005, he faces a mandatory minimum sentence of 20 years in prison. Judge Frank will determine his sentence at a future hearing, yet to be scheduled.

This case is the result of an investigation by the Federal Bureau of Investigation and the Central Minnesota Violent Offender Task Force. It is being prosecuted by Assistant United States Attorney Thomas Calhoun-Lopez.

 

 

MINNEAPOLIS — Last week in federal court, a 37-year-old Winona man was sentenced for conspiring to distribute methamphetamine. United States District Court Judge Richard H. Kyle sentenced Gabriel Orion Lowther to 120 months in federal prison, followed by five years of supervised release. Lowther, who was indicted on July 8, 2013, pleaded guilty to one count of Conspiracy to Distribute Methamphetamine.

In his plea agreement, Lowther admitted that from at least August 2012 through June 2013, he conspired with others to distribute methamphetamine from Texas to areas within southeastern Minnesota. Lowther admitted that his actions were part of a larger drug distribution enterprise which was operated by multiple conspirators between Minnesota and other areas of the United States.

This case was the result of an investigation by the Minnesota Bureau of Criminal Apprehension, the Drug Enforcement Administration, the South Central Drug Investigation Unit, and the Southeast Minnesota Narcotics and Gang Task Force. It was prosecuted by Assistant United States Attorney Allen A. Slaughter.

 

 

MINNEAPOLIS— A 45-year old Braham man was indicted yesterday for mailing threatening letters. Johnnie Earl Long was charged with one count of False Information and Hoaxes and six counts of Mailing Threatening Communications.

According to the indictment, in November 2013, Long allegedly mailed a series of threatening letters to numerous officials at the Pine County Courthouse. Although these letters contained a white powder that ultimately proved harmless, the letters suggested the powder contained a lethal pathogen.

If convicted, Long faces a potential maximum penalty of five years in prison on the false information count and five years on each threat count. Any sentence that may be imposed in this case would be determined by a federal district court judge.

This case is the result of an investigation by the Pine County Sheriff’s Office and the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorneys Andrew R. Winter and Charles J. Kovats, Jr.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS— Yesterday in federal court, Roger Martin Pedley was sentenced for evading taxes for the tax years 2006-2009. Pedley was indicted on April 9, 2013 and pleaded guilty to four counts of Tax Evasion on August 12, 2013. United States District Court Chief Judge Michael J. Davis sentenced Pedley to one year and one day in prison on each of the four counts, to be served concurrently, and ordered Pedley to pay $489,623 in restitution.

According to his plea agreement, Pedley admitted to owning and operating the Pine Ridge Golf Course in Motley as well as engaging in other business ventures. These ventures generated considerable cash income for Pedley. In his plea agreement, Pedley also admitted to engaging in transactions with this cash at various banks in ways that avoided triggering the banks’ federal currency reporting requirements. In addition, Pedley admitted that he failed to declare the cash as income on his personal income tax returns, filed jointly with his wife for tax years 2006, 2007, 2008, and 2009.

This case was the result of an investigation by the IRS- Criminal Investigation Division. The case was prosecuted by Assistant U.S. Attorney John Docherty.

 

 

MINNEAPOLIS— Yesterday in federal court in St. Paul, United States District Court Judge
Susan Richard Nelson sentenced Sheikh Bilaal Muhammad Arafat, formerly known as Mark
Edward Wetsch, to 168 months in federal prison for committing a series of bank robberies in
2011 and 2012. In late April and early May 2013, Arafat, dubbed the “Man-in-Black” bank robber, pleaded guilty to six counts of bank robbery. Arafat also admitted responsibility for 25 additional bank robberies that occurred in the southern half of Minnesota in 2011.

In his plea agreement, Arafat admitted that from January 11, 2011, to January 3, 2012, he robbed 31 banks in Minnesota while wearing a black mask and brandishing a firearm believed to be real.
During the e robberies, Arafat took more than $110,000, in total, from the 31 banks.

This case was the result of an investigation by the Federal Bureau of Investigation and the police departments of Alexandria, Bloomington, Columbia Heights, Eden Prairie, Faribault, Gaylord, Hastings, Hopkins, Minneapolis, Northfield, Orono, Prior Lake, Richfield, Savage, St. Paul, St.
Peter, and Shakopee; the sheriff’s departments of Carver, Dakota, Hennepin, Ramsey, Nicollet, Nobles, Sibley, and Wright counties; and with assistance from the Minnesota State Patrol. The case was prosecuted by Assistant United States Attorneys Deidre Y. Aanstad and
Kevin S. Ueland.

 

 

MINNEAPOLIS— Last week in federal court in St. Paul, a 59-year old Leesburg, Florida man pleaded guilty to defrauding investors and investment fund managers out of more than $2,500,000.
Gary Richard Vibbard, formerly of Wayzata, pleaded guilty to Mail Fraud. Vibbard, who was indicted on August 21, 2013, entered his plea before United States District Court Judge Paul A. Magnuson.

In his plea agreement, Vibbard admitted that from 2008 to 2010, he engaged in a scheme to defraud investors and investment fund managers through the sale of investments in R. Capital Advisors
(RCA), a Minnesota company created, owned, and managed by Vibbard. Vibbard admitted that, instead of paying investors their profits as planned, RCA resorted to repaying earlier investors with funds provided by later investors. In the plea agreement, Vibbard acknowledged that the scheme defrauded more than 10 victims of funds totaling between $2,500,000 and $7,000,000.

The U.S. Attorney’s Office and Vibbard have agreed to recommend a 63-month prison sentence to Judge
Magnuson. In addition, Vibbard will be ordered to pay restitution and could be ordered to pay a fine. A sentencing hearing is yet to be scheduled.

This case is the result of an investigation by the United States Postal Inspection Service and the
Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Robert M. Lewis.

 

 

MINNEAPOLIS— United States Attorney Andrew M. Luger will meet with county attorneys and law enforcement officials from the central and north central regions of the state on Tuesday, May 13, 2014 in St. Cloud to discuss federal law enforcement priorities and opportunities for local, state, and federal law enforcement to work together.

Issues of regional concern will be discussed, including Mr. Luger’s focus on human trafficking as well as drug prosecutions, long a focus of federal law enforcement. Hosted by Stearns County Attorney Janelle Kendall and Stearns County Sheriff, John Sanner, the planned discussion is a law enforcement only working session to create efficiency, strengthen partnerships, and increase the effectiveness of local, state, and federal public safety resources.

 

 

MINNEAPOLIS—Yesterday in federal court, a 22-year-old Minneapolis man, Larry Jarrell Campbell pleaded guilty to one count of Carjacking and one count of Brandishing a Firearm During and in Relation to a Crime of Violence. Campbell, who was indicted on March 10, 2014, entered his plea before United States District Court Judge Joan N. Ericksen.

In his plea agreement, Campbell admitted that on January 12, 2014, he approached a vehicle occupied by two victims and parked in the parking lot of a convenience store in North Minneapolis. He tapped on the rear window of the vehicle using a .22 caliber pistol and got into the back seat of the vehicle. He then pointed the gun at the two victims and threated to kill them. He demanded that the victims drive him to two separate ATMs to have the victims withdraw money from their bank accounts for him. He then commanded the victims to exit the vehicle and to lie face-down in a snowbank at gunpoint, so he could steal their vehicle. He then took the vehicle, drove to a nearby Walmart store, and attempted to use one of the victim’s credit cards to purchase merchandise.

Carjacking carries a potential maximum penalty of 15 years imprisonment. Brandishing a Firearm During and in Relation to a Crime of Violence carries a statutory minimum penalty of seven years, and a potential maximum penalty of life imprisonment. Judge Ericksen will determine the defendant’s sentence at a future hearing, not yet scheduled.

This case is the result of an investigation by the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Minneapolis Department. It is being prosecuted by Assistant U.S. Attorney Surya Saxena.

 

 

MINNEAPOLIS— Yesterday in federal court, a 67-year-old Bloomington man was sentenced for escaping from a Federal Prison Camp in Duluth. United States District Court Judge Patrick J. Schiltz sentenced Gerald James Greenfield to an additional 18 months in federal prison.

Greenfield was serving a 50-month sentence for conspiracy to commit money laundering when he escaped from the prison facility in Duluth on March 30. The defendant was arrested on April 5 at a hotel in Burnsville.

This case was the result of an investigation by the United States Marshals Service and the Federal Bureau of Prisons. It was prosecuted by Assistant United States Attorney Manda M. Sertich.

 

 

MINNEAPOLIS— United States Attorney Andrew Luger announced today that a United States Grand Jury indicted four men for their roles in a large-scale, methamphetamine-trafficking organization and a violent kidnapping in St. Paul. The indictment, returned on May 5, 2014 and unsealed today, charges Jesus Ramirez, 31, of Los Angeles, CA; Jonatan Delgado Alvarez, 22, of Los Angeles, CA; Juan Ricardo Elenes Villalvazo, a.k.a. Chapo, 32, of St. Paul, MN; and Antonio Navarro a.k.a. Tony Sanchez, 19, of St. Paul, MN.

The indictment alleges that Ramirez, Alvarez, Villalvazo, and Navarro participated in a conspiracy to distribute methamphetamine. According to the indictment, Navarro and Villalvazo maintained a stash house in St. Paul for storing large amounts of methamphetamine for distribution as part of the conspiracy.

On April 14, 2014, defendants Ramirez and Alvarez flew from Los Angeles, California to Minnesota in response to a report that approximately 30 pounds of methamphetamine had been stolen from the stash house two days earlier. On the evening of April 14, the four defendants kidnapped two victims at gunpoint and held them captive against their will at the stash house. The defendants bound and beat the victims and made violent threats against their lives and the lives of their family members, while demanding information about the missing methamphetamine. According to the indictment, Villalvazo cut one of the victim’s fingers, nearly severing it, while Ramirez held the victim down. After determining that the victims had no information about the missing drugs, the defendants released them.

Upon leaving the stash house at approximately 7:30 p.m. on April 15, Navarro was arrested by law enforcement officers, who had surrounded the premises. At approximately 7:40 p.m. that night, Alvarez attempted to leave the stash house and was also arrested by law enforcement officers. In the early morning hours of April 16, Ramirez flew back to Los Angeles from the Minneapolis-St. Paul International Airport. He was arrested the following day at a hotel in a Los Angeles suburb after leading police officers on a high speed car chase.

All four defendants were charged with one count of Conspiracy to Distribute Methamphetamine. In addition, the indictment alleges that Ramirez carried a firearm and used it to kidnap and threaten the victims.

If convicted, all four defendants could face a potential maximum penalty of life in prison for the drug conspiracy charge. Ramirez faces a potential minimum penalty of seven years in prison for the firearm charge. All sentences are ultimately determined by a federal district court judge.

This case is the result of an investigation by the Safe Streets Task Force. Safe Streets is a FBI-sponsored task force that focuses on combating violent street crime as well as gang and drug-trafficking offenses. Officers from the Minneapolis Police Department and the St. Paul Police Department, who are members of the Safe Streets Task Force, were instrumental in the investigation of this case. This case is being prosecuted by Assistant United States Attorney Jeffrey S. Paulsen. The defendants will make their first appearance today at 2:00 p.m. in federal court in St. Paul before Magistrate Judge Tony N. Leung.

United States Attorney Andrew Luger commended the work of the Safe Streets Task Force. “The allegations in the indictment are a frightening reminder of the violent capabilities of drug traffickers. Safe Streets and our Office are dedicated to protecting our citizens from this type of outrageous and violent conduct.”

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS— Andrew Luger, United States Attorney for the District of Minnesota, and Jack Riley, Special Agent-in-Charge of the Chicago Field Division of the U.S. Drug Enforcement Administration (“DEA”), announced today that over 65 heroin distributors were arrested and/or charged with state and federal drug trafficking crimes throughout the State of Minnesota. The charges are part of a joint local, state and federal drug trafficking investigation, named “Operation Exile.”

The investigation involved agents and officers from the DEA, FBI, ATF, ICE, U.S. Marshals Service, Bureau of Criminal Apprehension as well as the Sheriff’s and County Attorney’s Offices from Hennepin, Ramsey, Dakota, Anoka, Washington, St. Louis and Olmsted counties. The local police departments in all seven counties were involved as well. In addition to the over 65 arrests, agents and officers conducted dozens of search warrants at locations throughout the state to gather evidence in support of the heroin trafficking prosecutions that will follow today’s events.

Mr. Luger praised the DEA for bringing local, state and federal law enforcement together to coordinate efforts to combat heroin trafficking. “In recent years, high purity inexpensive heroin in powder form has been imported to Minnesota in large quantities. Operation Exile is a coordinated law enforcement campaign to investigate and prosecute heroin traffickers at all levels in Minnesota. Our goal is to make it as difficult as possible for drug cartels to bring heroin to our state.”

The United States Attorney’s Office has been working with law enforcement at the local, state and federal levels to prepare for Operation Exile. Federal and State prosecutors will determine over the coming days which jurisdiction will prosecute the approximately 65 traffickers charged today.

Luger noted how heroin abuse has become a significant problem in a number of states around the country. Luger stated that law enforcement is determined to prevent Minnesota from becoming the next state to face such a crisis.

“Our goal is to tackle the problem of heroin addiction before heroin traffickers become embedded in our community. Operation Exile is an important step in making Minnesota off limits to large scale heroin distributors,” said Luger.

An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS—Yesterday in federal court, a 24-year-old felon was sentenced for assaulting a White Earth woman as well as possessing a short-barreled shotgun. United States District Judge John R. Tunheim sentenced Michael James Deegan to 92 months and 60 months (concurrent) in federal prison on one count of possession of an unregistered firearm and one count of assault resulting in substantial bodily injury. Deegan, who was indicted on September 24, 2013, pleaded guilty on December 16, 2013.

In his plea agreement, Deegan admitted that on June 4, 2013, he assaulted a woman on the White Earth Indian Reservation by punching her in the head and body. This resulted in substantial bodily injury to the victim. Deegan also admitted to possessing a short-barreled shotgun at the time of his arrest.

This was the first case accepted from White Earth under an assumption of concurrent jurisdiction that commenced on June 1, 2013. This case was a result of an investigation by the Federal Bureau of Investigation, the White Earth Tribal Police Department, and the Mahnomen County Sheriff’s Office. It was prosecuted by Assistant U.S. Attorney Deidre Y. Aanstad.

Because the White Earth Indian Reservation is a concurrent jurisdiction reservation, some of the crimes that occur there are investigated by the FBI in conjunction with the White Earth Tribal Police Department and local County Sheriff’s Offices. Those cases are prosecuted by the U.S. Attorney’s Office.

 

 

MINNEAPOLIS—Earlier today, a jury in federal court in Duluth found a 47-year-old Ponemah man guilty of strangling a woman while on the Red Lake Indian Reservation. Following a three-day trial, the jury convicted Terry Dean Iceman on one count of strangulation. Iceman was indicted on November 13, 2013.

According to the evidence presented at trial, on July 18, 2013, Iceman assaulted the victim by strangling and attempting to strangle her. For his crime, Iceman faces a potential maximum penalty of 10 years in prison. United States District Chief Judge Michael J. Davis will determine his sentence at a future hearing, yet to be scheduled.

This case is the result of an investigation by the Red Lake Tribal Police Department and the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorneys Manda M. Sertich and Deidre Y. Aanstad.

Because the Red Lake Indian Reservation is a federal-jurisdiction reservation, some of the crimes that occur there are investigated by the FBI in conjunction with the Red Lake Tribal Police Department. Those cases are prosecuted by the U.S. Attorney’s Office.

Violence against American Indian women occurs at epidemic rates. In 2005, Congress found that one in three American Indian women is raped during her lifetime, and American Indian women are nearly three times more likely to be battered during their lives than Caucasian women.

The U.S. Justice Department is taking steps to increase engagement, coordination, and action relative to public safety in tribal communities, including the creation of the Violence Against Women Federal and Tribal Prosecution Task Force. This task force will explore current issues raised by professionals in the field and recommend “best practices” in prosecution strategies involving domestic violence, sexual assault and stalking.

To learn more about the Justice Department’s Tribal Safety program, visit http://www.justice.gov/tribal/.

 

 

MINNEAPOLIS—Yesterday in federal court, a jury found a 52-year-old North Oaks man guilty of defrauding investors to persuade them to invest in a purported wind energy project. Instead of building the wind energy project, the defendant used the investors’ $1.5 million to pay for his personal expenses and his other wind energy projects. On April 1, 2014, following a six-day trial, the jury convicted Gregory Joseph Jaunich on five counts of mail fraud. Jaunich was indicted on July 16, 2013.

According to the evidence presented at trial, from October 2006 through January 2007, Jaunich solicited funds from individual investors and investor groups for the purchase of membership units in Averill Wind, a company Jaunich created to develop and operate a wind energy project in Clay County, Minnesota. To induce these investments, Jaunich made false material representations concerning the project’s status, including telling them that the project was closer to completion than what was actually the case. In addition, Jaunich failed to disclose that at the time he was soliciting investments in Averill Wind, he was under criminal investigation by federal law enforcement for fraudulently overbilling Xcel Energy for wind energy production.

From October 2006 through January 2007, Jaunich received more than $1.5 million from investors. Jaunich told investors that the funds would be used to develop, operate and maintain the Averill project. Instead, Jaunich diverted almost all of the funds to his own personal use, to pay personal expenses and debts, and to pay expenses and debts relating to other wind energy projects. To keep the scheme from being discovered, in April 2007 and June 2008, Jaunich mailed letters to the investors containing false information about the status of the Averill Project and the use of the investors’ money via the United States Postal Service.

For his crimes, Jaunich faces a potential maximum penalty of 20 years in prison on each count. U.S. District Judge John R. Tunheim will determine his sentence at a future hearing, yet to be scheduled. This case is the result of an investigation by the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorneys Kimberly A. Svendsen and John Kokkinen.

To learn more on how to protect yourself from mail fraud, visit http://www.stopfraud.gov/protect-massmarket.html.

 

 

MINNEAPOLIS—Last week in federal court in Fergus Falls, a jury found a 40-year-old Red Lake man guilty of assaulting an infant while on the Red Lake Indian Reservation. On March 13, 2014, following a four-day trial, the jury convicted James White, Jr., on one count of assault resulting in serious bodily injury. White was indicted on October 22, 2013.

According to the indictment and evidence presented at trial, on August 30, 2013, White assaulted the infant. For his crime, White faces a potential maximum penalty of life in prison. United States District Judge John R. Tunheim will determine his sentence at a future hearing, yet to be scheduled.

This case is the result of an investigation by the Red Lake Tribal Police Department and the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Deidre Y. Aanstad.

Because the Red Lake Indian Reservation is a federal-jurisdiction reservation, some of the crimes that occur there are investigated by the FBI in conjunction with the Red Lake Tribal Police Department. Those cases are prosecuted by the U.S. Attorney’s Office.