District of Minnesota

MINNEAPOLIS—Earlier today in federal court, a 47-year-old St. Paul man was indicted in connection with the December 13, 2012, armed robbery of the US Bank branch located at 711 Cleveland Avenue South in St. Paul. David Judin Greer was specifically charged with one count of armed bank robbery and one count of brandishing a firearm during a crime of violence.

The indictment alleges that on December 13, Greer stole $3,952 from the bank after brandishing a .38-caliber revolver. According to a law enforcement affidavit filed in the case, a man, later identified as Greer, walked into the bank at approximately 2:00 p.m. He allegedly approached the teller counter, pulled the gun, and demanded twenties, fifties, and one-hundred-dollar bills. The teller took money from the cash drawer and stuffed it into the white plastic bag that Greer provided. After reportedly demanding and receiving even more money, he fled the premises.

Immediately following the robbery, the Federal Bureau of Investigation released to the public digital images of the robber. Later that same day, the FBI received a telephone call from an anonymous individual who identified the robber as Greer. Authorities then began surveillance on Greer’s residence.

On December 29, 2012, the FBI received a call from the St. Paul Police Department, indicating officers there had just conducted a welfare check on Greer at the request of a family member. Officials subsequently transported Greer to Regions Hospital, where Greer reportedly gave law enforcement consent to search his residence. There, officers located the revolver used in the bank robbery. It was hidden above the duct work in the basement.

If convicted, Greer faces a potential maximum penalty of 25 years in prison for armed robbery and seven years for brandishing of a firearm. All sentences will be determined by a federal district court judge. This case is the result of an investigation by the FBI and the St. Paul Police Department. It is being prosecuted by Assistant United States Attorney Clifford B. Wardlaw.

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 indictment unsealed earlier today charges a 33-year-old Red Lake man with endangering the health of a baby. On January 8, 2013, Chad Joseph Sumner was charged with one count of child endangerment. The indictment was unsealed following Sumner’s initial appearance in court.

The indictment alleges that on August 17, 2011, Sumner intentionally placed the child in a situation likely to be harmful. As a result, the infant suffered substantial physical harm, including head trauma and skull fractures.

If convicted of the crime, Sumner faces a potential maximum penalty of five years in federal prison. All sentences will be determined by a federal district court judge. 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 United States 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.

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—Earlier today in federal court, a 26-year-old Minneapolis man was indicted in connection with the armed robbery of three Twin-Cities area convenience stores and on two separate occasions, the same Jimmy John’s sandwich shop. Derrel Johon Pruitt was charged with five counts of interference with commerce by robbery, pursuant to the Hobbs Act, five counts of possession of a firearm in furtherance of a crime of violence, and one count of possession of an unregistered firearm.

The indictment alleges that on five occasions, Pruitt stole money from the businesses while brandishing a sawed-off shotgun: On October 13, 2011, he allegedly robbed the Quick Stop store in South St. Paul; on October 22, 2011, he allegedly robbed the Stop N’ Go store in Minneapolis; on November 18, 2011, he allegedly robbed the Jimmy John’s in Minneapolis; on November 24, 2011, he allegedly robbed the Holiday store in Inver Grove Heights; and on December 2, 2011, he allegedly robbed the same Jimmy John’s in Minneapolis.

In addition, on December 5, 2011, Pruitt possessed the shotgun, which had a barrel length of less than 18 inches and an overall length of less than 26 inches. The firearm was not registered to Pruitt in the National Firearms Registration and Transfer Record, as required by law.

As stated, Pruitt was charged in federal court under the Hobbs Act, which was passed by Congress in1946. The Act allows federal prosecutors to prosecute violent habitual criminals who commit armed robberies in places of business that involve interstate commerce. Federal prosecution of these cases is sometimes beneficial since federal penalties are often tougher than those imposed under state law. Moreover, because the federal system has no parole, those who receive federal sentences serve virtually their entire prison terms behind bars.

If convicted, Pruitt faces a potential maximum penalty of 20 years in federal prison on each count of violating the Hobbs Act, ten years for possession of an unregistered firearm, and a mandatory minimum of seven years on each count of possession of a firearm in furtherance of a crime of violence. The potential maximum penalty on those counts is life in prison. All sentences will be determined by a federal district court judge.

This case is the result of an investigation conducted by the United States Bureau of Alcohol, Tobacco, Firearms and Explosives, along with the Federal Bureau of Investigation, and the police departments of Inver Grove Heights, Minneapolis, St. Paul, and South St. Paul. It is being prosecuted by Assistant U.S. Attorneys Julie E. Allyn and Amber Brennan.

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—Earlier today in federal court in Duluth, a 22-year-old man was sentenced for committing the December 30, 2011, armed robbery of Newby’s Market in Bemidji. United States District Court Judge Richard H. Kyle sentenced Jason Lee King, no known address, to 132 months in federal prison on one count of interference with commerce by robbery, pursuant to the Hobbs Act, and one count of using, carrying, and brandishing a firearm during and in relation to a crime of violence. King was indicted on April 3, 2012, and pleaded guilty on June 11, 2012.

In his plea agreement, King admitted that on December 30, 2011, he stole approximately $1,476 from the store while threatening a store clerk with a loaded, short-barreled shotgun. According to a law enforcement affidavit filed in the case, the market was robbed just before 9:00 p.m. by two masked men armed with a shotgun and a knife. After the robbery, the men fled in a blue pickup.

In responding to the robbery, officers spotted the truck and the men abandoning it and fleeing into the woods. King and a juvenile male were ultimately found and taken into custody. Officers recovered the 20-gauge shotgun in the woods, along the route the men had taken in their attempt to escape authorities. Inside the pickup, police also found $1,420 in cash, a black ski mask, several Newby’s Market receipts, and a check made out to Newby’s Market.

The Hobbs Act, passed by Congress in 1946, allows federal prosecutors to prosecute violent, habitual criminals who commit armed robbery in places of business involved in interstate commerce. Federal prosecution of these cases is sometimes beneficial since the penalties are often tougher than under state law. Furthermore, because the federal system has no parole, those who receive federal sentences serve virtually their entire sentence behind bars.

This case was the result of an investigation by the Beltrami County Sheriff’s Office and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant U.S. Attorney Jeffrey S. Paulsen.

 

 

MINNEAPOLIS—Earlier today in federal court, a jury found a St. Paul man guilty of being a felon in possession of a nine-millimeter, semi-automatic pistol. Demetrius Demarco Spencer, age unknown, was convicted on one count. He was indicted on November 14, 2012.

According to the indictment and the evidence presented at trial, Spencer possessed the gun on August 23, 2012. On that day, officers on routine patrol outside of a Minneapolis nightclub saw Spencer standing in the parking lot. He reached into his pants and removed an “L-shaped” item covered with a white sock. He carried the item to a nearby car and placed it under the front seat. Later officers recovered the pistol, which had been hidden inside the sock.

Because he is a felon, Spencer is prohibited under federal law from possessing a firearm at any time. His prior Hennepin County convictions include possession of a pistol by a prohibited person (2003), assault in the third degree (2007), and aggravated robbery (2007). Spencer was also convicted in Ramsey County for possession of a pistol by a prohibited person (2000).

In the current federal case, Spencer faces a potential maximum penalty of ten years in prison. United States District Court Chief Judge Michael J. Davis will determine his sentence at a future hearing, yet to be scheduled.

This case resulted from an investigation by the Minneapolis Police Department and the Violent Impact Team for the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant U.S. Attorney Richard Newberry.

The case was charged federally through Project Exile Minneapolis. That law enforcement initiative was launched on July 22, 2010, as part of a city-wide effort to reduce gun violence. Through Project Exile, the Minneapolis Police Department and the ATF work together to apprehend serial criminals for violations of gun laws. Then, the Hennepin County Attorney’s Office teams up with the U.S. Attorney’s Office to determine where those offenders will most effectively be prosecuted – state or federal court. Those determinations are based on the offenders’ criminal histories and current charges, among other factors. To date, the U.S. Attorney’s Office has brought charges against more than a dozen serious habitual criminals through Project Exile Minneapolis.

 

 

MINNEAPOLIS—Earlier today in federal court, a 39-year-old Faribault man pleaded guilty to writing 127 fraudulent checks to himself. Ronald Leo Schaeffer pleaded guilty to one count of bank fraud in connection to the crime. Schaeffer was charged on December 6, 2012, and entered his plea before United States District Court Judge David S. Doty.

In his plea agreement, Schaeffer admitted that from August of 2008 through April of 2012, he stole approximately $432,504.10 from his employer, Environmental Tillage Systems, Inc. (“ETS”). ETS, an agricultural manufacturing company in Faribault, hired Schaeffer as its sole in-house accountant. Among other duties, he was responsible for using the QuickBooks accounting software to record information regarding payments owed by ETS to vendors and employees.

Schaeffer admittedly wrote approximately 127 fraudulent checks against the ETS checking account, in amounts ranging from approximately $400 to $12,000, for deposit into his personal account. To conceal his actions, he also made false entries in ETS’s QuickBooks accounting records in an effort to make it appear as if the checks were issued to legitimate ETS vendors.

For a period of time, Schaeffer had the authority to use a signature stamp to validate company checks. Beginning in November of 2010, he was directed to obtain the actual signatures of ETS’s CEO or CFO on all checks before disbursing them. At that point, he began forging the signature of the CEO or CFO on any check he wrote to himself. He used the money he stole to build a lake home in Elysian, Minnesota, and make payments on his auto and home-equity loans.

For his crime, Schaeffer faces a potential maximum penalty of 30 years in federal prison, as well as possible fines and orders of forfeiture. Judge Doty 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. Attorney Benjamin F. Langner.

 

 

MINNEAPOLIS—Earlier today in federal court, a 48-year-old woman from the southwestern Minnesota community of Belview was sentenced for stealing hundreds of thousands of dollars from the customers of Minnwest Bank, in Marshall, Minnesota, where she worked. United States District Court Judge John R. Tunheim sentenced Barbara Kaye Rechtzigel to 24 months in federal prison on one count of embezzlement by a bank officer. The judge also ordered her to pay $1,013,018.27 in restitution to the bank. Rechtzigel was charged on July 23, 2012, and pleaded guilty on August 6, 2012.

In her plea agreement, Rechtzigel admitted that from 1998 through June of 2012, she embezzled the money for her personal use, primarily to pay off shopping debts. When she was terminated from employment on June 4, 2012, Rechtzigel was the senior operations manager at the bank’s Marshall location.

To carry out her embezzlement scheme, Rechtzigel created false paperwork to make bank customers believe their CDs were being renewed and earning interest, when, in fact, she was stealing and spending the money. The bank ultimately repaid the customers victimized by the scheme. In total, the bank paid out more than $1 million.

This case was the result of an investigation by the Federal Bureau of Investigation and the Marshall Police Department, with assistance from the Federal Deposit Insurance Corporation—Office of Inspector General. It was prosecuted by Assistant U.S. Attorney William J. Otteson.

 

 

MINNEAPOLIS—Earlier today in federal court in St. Paul, a 39-year-old St. Paul man was sentenced for filing a false insurance claim for $250,000. United States District Court Judge Susan Richard Nelson sentenced Jason William Sheedy to three years of probation on one count of wire fraud in connection to this incident. In addition, Sheedy must pay $352,539.58 in restitution and serve 500 hours of community service. He was charged on August 6, 2012, and pleaded guilty on August 17, 2012.

In his plea agreement, Sheedy admitted that between September 2007 and December 2011, he devised a scheme to defraud the AXA Art Insurance Corporation (“AXA”). AXA is an insurance company that insures artwork and items of historical value.

In September of 2007, Sheedy insured several items, including artwork, with AXA. Then, on September 27, 2007, he filed an insurance claim for $274,905 with the company, reporting that some of the insured pieces, including several works of art, had been stolen from a moving van. On January 28, 2008, pursuant to that claim, AXA mailed Sheedy a check for $254,832. On May 24, 2011, however, Sheedy listed six of the reportedly stolen paintings on Artbrokerage.com, an Internet website for a Nevada auction house. A December 2011 search of Sheedy’s residence yielded all but one of the art pieces reportedly stolen.

Sheedy further admitted filing a false claim with the Farmer’s Insurance Company in September 2007. That claim was purportedly for stolen household items, valued at $93,302, that were, in fact, not stolen. The insurance company paid the claim on February 12, 2008.

This case was the result of an investigation by the Federal Bureau of Investigation. It was prosecuted by Assistant U.S. Attorneys Lola Velazquez-Aguilu and Benjamin F. Langner.

 

 

MINNEAPOLIS—Late last week in federal court, a 51-year-old Minneapolis man pleaded guilty to robbing the TCF Bank on West Lake Street in Minneapolis. He also admitted robbing three other banks. On January 11, 2013, Phillip Leo Nietz specifically pleaded guilty to one count of bank robbery. Nietz, who was indicted on October 10, 2012, entered his plea before United States District Court Judge Patrick J. Schiltz.

In his plea agreement, Nietz admitted that on August 22, 2012, he walked into the West Lake Street branch of TCF Bank and gave a teller a note demanding money. He took approximately $3,794, placed it in a black bag, and left the premises on foot. Nietz also admitted robbing three other banks in the same manner: a U.S. Bank in Roseville on August 14, 2012 ($1,047); a Wells Fargo in St. Paul on August 28, 2012 ($7,389); and a U.S. Bank in St. Paul on September 13, 2012 ($1,045).

For his crime, Nietz faces a potential maximum penalty of 20 years in prison. Judge Schiltz 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. Attorney Thomas Calhoun-Lopez.

 

 

MINNEAPOLIS—Earlier today in federal court, a 34-year-old felon from the northeastern Minnesota community of Aurora was sentenced for possessing a 20-gauge shotgun. United States District Court Judge Patrick J. Schiltz sentenced John Joseph Douglas to 240 months in federal prison on one count of being an armed career criminal in possession of a firearm. Douglas was indicted on this charge on October 4, 2011, and convicted on February 10, 2012, following trial.

The evidence presented at trial proved that on May 30, 2011, Douglas possessed the gun and, while surrounded by a group of people, fired it into the air several times. Upon their arrival on the scene, officers found the people seated around a campfire in a vacant lot. Searching the grounds, the officers discovered a box of ammunition and several freshly fired shotgun shell casings. They found the sawed-off shotgun itself nearby.

Because Douglas was previously convicted of a felony, he was prohibited under federal law from possessing firearms at any time. His prior convictions include third-degree burglary (1999), first-degree burglary (1999), second-degree assault (1999 and 2007), and aggravated robbery (twice in 1999), all of which occurred in St. Louis County. Since each of those offenses constituted crimes of violence, Douglas’s sentence in the current federal case was subject to the federal armed career criminal statute, which mandates a minimum sentence of 15 years in federal prison. Since the federal criminal justice system does not have parole, Douglas will serve virtually his entire sentence behind bars.

This case was the result of an investigation by the St. Louis County Sheriff’s Office, the Hoyt Lakes Police Department, the Gilbert Police Department, and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant U.S. Attorneys Andrew Dunne and Jeffrey M. Bryan.

 

 

MINNEAPOLIS—Earlier today in federal court, a 45-year-old career criminal was sentenced for possessing a nine-millimeter pistol. United States District Court Judge Joan N. Ericksen sentenced Michael Dennis Stanke, of Lino Lakes, to 180 months in prison on one count of being a felon in possession of a firearm. Stanke was indicted on June 11, 2012, and pleaded guilty on August 9, 2012.

In his plea agreement, Stanke admitted that on March 8, 2012, while visiting his mother at her residence, he took a nine-millimeter Norinco pistol from the house. He then stole a neighbor’s vehicle from a nearby driveway. A few hours later, Minnetonka police stopped the car Stanke was driving and arrested him. The officers found the loaded firearm lying on the front passenger seat, loaded with seven rounds in the magazine.

Because he is a felon, Stanke was prohibited under federal law from possessing a firearm at any time. His prior Ramsey County convictions include third-degree burglary (1989), theft (1989), fleeing a peace officer in a motor vehicle (1991), theft of a motor vehicle (1993), first-degree assault (2000), and first-degree aggravated robbery (2000). In addition, Stanke was convicted in Hennepin County for theft in 1996 and Dakota County for theft of a motor vehicle in 1997.

Since at least three of those offenses constituted crimes of violence, Stanke’s sentence in the current federal case was subject to the federal Armed Career Criminal Act. That act mandates a minimum of 15 years in federal prison. Because the federal criminal justice system does not have parole, Stanke will spend virtually his entire sentence behind bars.

This case was the result of an investigation by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives and the Minnetonka Police Department. It was prosecuted by Assistant U.S. Attorney Allen A. Slaughter.

 

 

MINNEAPOLIS—Earlier today in federal court, a 46-year-old woman pleaded guilty to assaulting another inmate at the Federal Correctional Institute in Waseca, Minnesota. Felecia Thomas pleaded guilty to one count of assault with a dangerous weapon. She did not enter into a plea agreement with the United States, but, rather, offered a “straight plea” to the single count in the indictment, which was filed on May 15, 2012.

The indictment alleges that on June 10, 2011, Thomas, who was then serving time at the correctional facility in Waseca following a 2004 conviction for arson and use of explosives in commission of a felony, assaulted an inmate with a rope. The rope allegedly had been removed from a laundry bag.

For her crime, Thomas faces a potential maximum penalty of ten years in prison. U.S. District Court Chief Judge Michael J. Davis will determine her 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 U.S. Bureau of Prisons. It is being prosecuted by Assistant U.S. Attorneys John E. Kokkinen and Lola Velazquez-Aguilu.

 

 

MINNEAPOLIS—Earlier today in federal court, an indictment was unsealed, charging a 46-year-old man from the Red Lake Indian Reservation community of Ponemah with one count of involuntary manslaughter in connection with the August 19, 2012, death of Kaishauna Thunder. On January 8, 2013, Gordon Dean Johnson was charged with the crime. The indictment was unsealed following Johnson’s initial appearance in court today.

The indictment alleges that during the early morning of August 19, 2012, Johnson killed Thunder without malice. It alleges that at approximately 3:00 a.m., Johnson was operating a motor vehicle in a reckless manner while under the influence of alcohol. He struck Thunder, who was walking alongside State Highway 1.

If convicted, Johnson faces a potential maximum penalty of eight years in prison. All sentences will be determined by a federal district court judge. This case is the result of an investigation by the Federal Bureau of Investigation and the Red Lake Tribal Police Department. It is being prosecuted by Assistant United States Attorney Clifford B. Wardlaw.

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.

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, an Apple Valley woman was charged with defrauding both her employer and Medica. On January 9, 2012, Lori Jo Mueller, age 48, was charged via an Information with one count of wire fraud and one count of health care fraud.

Allegedly, from June of 2006 through June of 2012, Mueller embezzled approximately $840,000 from Edelweiss Home Health Care and used the funds for her personal use. Mueller began working for Edelweiss, located in Osseo, in 2002, and was promoted to the position of vice president of operations. In that capacity, Mueller was responsible for the review and payment of corporate invoices, bookkeeping, and other financial matters. Mueller allegedly used her access to the corporate checking account to issue payments from corporate accounts to herself. Also, Mueller allegedly concealed her actions from the company owners and made misrepresentations concerning the company’s financial state.

In addition, from March of 2010 through June of 2012, Mueller allegedly defrauded Medica, a health care benefit program. She purportedly submitted claims to various insurers, seeking reimbursement for services provided by Edelweiss nursing staff. In some instances, Mueller double-billed by submitting claims for the same services to multiple insurance providers. For example, Mueller allegedly billed both Minnesota Medicaid and Medica for services provided to one client. The double-billing resulted in a double-payment to Edelweiss with Medicaid being the proper payer and Medica being the overpayer. As a result of this criminal behavior, Mueller obtained for Edelweiss more than $631,000 in fraudulent proceeds. Medica is a non-profit corporation that provides health insurance products to families and individuals.

If convicted in this case, Mueller faces a potential maximum penalty of 30 years in federal prison on the wire fraud count and ten years on the health care fraud count. All sentences will be determined by a federal district court judge.

This case is the result of an investigation by the Federal Bureau of Investigation and the United States Department of Health and Human Services-Office of Inspector General (“DHHS-OIG”). It is being prosecuted by Assistant U.S. Attorney David M. Genrich.

The U.S. Attorney’s Office participates in a task force with the Medicaid Fraud Control Unit at the Minnesota Attorney General’s Office that focuses on home health care fraud trends. The task force includes the DHHS-OIG, the FBI, the Internal Revenue Service, and other federal, state, and local law enforcement partners.

As a result of federal convictions for health care fraud, defendants are excluded from participating in federal health benefit programs, including Medicare and Medicaid. Exclusion determinations are made by the U.S. Department of Health and Human Services. Nationwide, more than 3,000 individuals were excluded from program participation in Fiscal Year 2010 based upon criminal convictions or patient abuse or neglect, license revocations, or other factors.

For more information, visit http://www.stopmedicarefraud.gov/

A defendant, of course, is presumed innocent until he or she pleads guilty or is proven guilty at trial.

 

 

MINNEAPOLIS – In the District of Minnesota, separate charges have been filed against two Mexican nationals who allegedly entered the United States illegally after being deported as criminals. Earlier today in federal court in St. Paul, indictments were filed against two individuals for illegal entry after deportation.

Mario Mireles-Flores, age 23, was charged in the first case. His indictment alleges that on December 5, 2012, authorities found him in the U.S. illegally after he had been previously deported. His deportation followed a 2010 McLeod County conviction for escape from custody. Authorities recently identified him as an illegal alien with a criminal record while he was serving a sentence in the Sibley County Jail for providing false information to police. That identification was made through the U.S. Immigration and Customs Enforcement’s (“ICE”) Criminal Alien Program (“CAP”). The goal of that program is to locate criminal aliens incarcerated in federal and state prisons, as well as in local jails, and prevent them from being released into society by having them federally prosecuted for illegally re-entering the U.S.

If convicted of the federal charge now levied against him, Mireles-Flores faces a potential maximum penalty of 20 years in federal prison, followed by deportation. All sentences will be determined by a federal district court judge. This case is the result of an investigation by ICE’s Enforcement and Removal Operations (“ICE ERO”). It is being prosecuted by Assistant U.S. Attorney Lola Velazquez-Aguilu.

In the second case, Sergio Vasquez, age 36, was charged with illegally entering the U.S. following deportation. His indictment alleges that on December 4, 2012, authorities found him in the U.S. after he had been deported in 2008, following a 2003 Pennsylvania conviction for delivery of a controlled substance. On December 3, 2012, Vasquez was arrested by Minneapolis Police for DWI in connection to a personal-injury crash in south Minneapolis. He was identified as an illegal alien with a criminal record via the CAP.

If convicted of the federal charge now filed against him, Vasquez faces a potential maximum penalty of 20 years in federal prison, followed by deportation. All sentences will be determined by a federal district court judge. This case is the result of an investigation by the Minneapolis Police Department and ICE ERO. It is being prosecuted by Assistant U.S. Attorney Clifford B. Wardlaw.

In some instances, federal prosecution will occur only after the individual is prosecuted for the recent underlying offense. Both men will remain in custody until their current federal cases are resolved. To learn more about the CAP, visit www.ice.gov/criminal-alien-program/

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—Earlier today in federal court in St. Paul, a 36-year-old Minneapolis felon was indicted for possessing a .40-caliber, semi-automatic pistol. Demario Kentrell Booker was charged with one count of being a felon in possession of a firearm.

The indictment alleges that on November 20, 2012, Booker possessed the gun. Because he is a felon, he is prohibited under federal law from possessing a firearm at any time. Booker’s prior Hennepin County convictions include assault in the third degree (2004), assault in the fourth degree (2008), and prohibited person in possession of a firearm (2009).

According to a law enforcement affidavit filed in the current federal case, at approximately 2:00 a.m. on November 20, police noticed a vehicle cross the center line and fail to signal for a turn. In response, the officers activated their lights. The driver of the vehicle, later found to be Booker, sped away. Police pursued him, eventually bringing him to a stop in Robbinsdale. He was arrested after a brief scuffle. The pistol was found in the vehicle.

If convicted, Booker faces a potential maximum penalty of ten years in federal prison. All sentences will be determined by a federal district court judge. This case is the result of an investigation by the Minneapolis Police Department and the United States Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant U.S. Attorney 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—Yesterday in federal court, the operator of Lucky Home Health Care, Inc., a home health care agency in Minneapolis, was charged with defrauding Medicaid. On January 8, 2013, Abshir Mohammed Ahmed, age 40, of Minneapolis, was charged via an Information with one count of health care fraud.

Allegedly, from January of 2008 through June of 2011, Ahmed defrauded Medicaid, a federal health care benefit program, out of more than $400,000 by submitting fraudulent billings. Ahmed submitted claims that falsely represented that home health care services were purportedly provided by identified Personal Care Assistants (“PCA”) that were not in fact provided by those PCAs.

For example, a claim for reimbursement, submitted on July 16, 2009, billed Medicaid $1,330.56 for PCA services allegedly, but not actually, provided by the identified PCA.

The Medicaid program provides medical care and services to low-income people who meet certain income and eligibility requirements. Home health care, provided by PCAs, is one of the services reimbursed by Medicaid.

If convicted, Ahmed faces a potential maximum penalty of ten years in federal prison. All sentences will be 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 David M. Genrich.

The U.S. Attorney’s Office participates in a task force with the Medicaid Fraud Control Unit at the Minnesota Attorney General’s Office that focuses on home health care fraud trends. The task force includes the U.S. Department of Health and Human Services-Office of Inspector General, the FBI, the Internal Revenue Service, and other federal, state, and local law enforcement partners.

As a result of federal convictions for health care fraud, defendants are excluded from participating in federal health benefit programs, including Medicare and Medicaid. Exclusion determinations are made by the U.S. Department of Health and Human Services. Nationwide, more than 3,000 individuals were excluded from program participation in Fiscal Year 2010 based upon criminal convictions or patient abuse or neglect, license revocations, or other factors.

For more information, visit http://www.stopmedicarefraud.gov/

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 48-year-old man from the central
Minnesota community of Garfield was found guilty of constructing a road through a federallyprotected wetland basin located on his property. Based on evidence presented during a two-day bench trial last August, United States Magistrate Judge Leo I. Brisbois issued a written order on
January 4, 2013, convicting James Bosek of one misdemeanor count of filling a wetland that was subject to a federal easement under the National Wildlife Refuge System Act.

Judge Brisbois found that Bosek engaged in prohibited activity when he built a road across the eastern edge of his property, located in rural Douglas County. The property is subject to a perpetual easement that the U.S. Department of Interior purchased in 1963. Bosek purchased the property subject to the easement in 2001.

Judge Brisbois found that Bosek knew of the easement before building the road, and that
Bosek did not obtain permission or authorization from the U.S. Fish and Wildlife Service
(“USFWS”) before building the road. The USFWS discovered the road while making an unrelated visit to Bosek’s property in April of 2008. Judge Brisbois credited the trial testimony of a USFWS biologist, who surveyed the property and concluded that Bosek’s filling of the wetland damaged the wetland as a protected native habitat for waterfowl. Bosek was charged on
August 19, 2011, after refusing the USFWS’s demand that he remove the road and restore the wetland.

Under the statute of conviction, Bosek faces a potential maximum penalty of 180 days in prison, a $5,000 fine, and costs of restoring the wetland. Judge Brisbois will determine his sentence at a future hearing, scheduled for March 27, 2013, at the federal courthouse in Fergus
Falls. This case is the result of an investigation by the USFWS. It is being prosecuted by Assistant U.S. Attorneys Lola Velazquez-Aguilu, Thomas Calhoun-Lopez, and William J.
Otteson.

 

 

MINNEAPOLIS— Earlier today in federal court, United States District Court Chief Judge Michael J. Davis sentenced three individuals in connection to the multi-million-dollar Ponzi scheme orchestrated by Trevor Cook.

Jason Bo-Alan Beckman, age 43, of Plymouth, was sentenced to 360 months in federal prison, on 17 counts of wire and mail fraud, two counts of conspiracy to commit mail and wire fraud, four counts of money laundering, two counts of filing a false tax return, and one count of tax evasion. Because the federal criminal justice system does not have parole, Beckman will spend virtually his entire sentence behind bars. He and the other co-defendants sentenced today were also solely and jointly ordered to pay $155,359,411.77 in restitution to the victims of their fraud scheme.

Gerald Joseph Durand, age 61, of Faribault, was sentenced to 240 months on 12 counts of wire and mail fraud, one count of conspiracy to commit mail and wire fraud, and two counts of money laundering, two counts of concealing a material fact from the United States, and three counts of filing a false tax return.

Christopher Pettengill, age 56, also of Plymouth, was sentenced to 90 months in federal prison on one count of securities fraud, one count of conspiracy to commit wire fraud, and one count of money laundering.

The sentencing of Patrick Kiley, age 74, was rescheduled for January 18, 2013, after he requested and received a continuance following the appointment of a new lawyer. Kiley will be sentenced on 12 counts of wire and mail fraud, one count of conspiracy to commit mail and wire fraud, and two counts of money laundering.

Beckman, Durand and Kiley were charged in a second superseding indictment on February 22, 2012, and were convicted on June 12, 2012, after a near-two-month trial. Pettengill was charged on June 13, 2011, and pleaded guilty on June 21, 2011.

In sentencing Beckman, Judge Davis called him a central figure in the fraud scheme, adding that the harm he caused was worse than using a gun because he “used the English language to violate so many.” Beckman and his co-conspirators defrauded more than 725 people during the course of their fraud scheme.

Following the sentencings, U.S. Attorney B. Todd Jones said, “We are very pleased with today’s sentences. These are the types of cases this office will vigorously pursue—cases where defendants prey on vulnerable populations, such as the elderly, or use special relationships, like those established through faith communities, to commit financial fraud that devastates thousands of people, crushing their dreams of retirement or college for their children.”

Kelly R. Jackson, Special Agent in Charge of the Internal Revenue Service-Criminal Investigations’ St. Paul Field Office, added, “IRS-Criminal Investigation is committed to unraveling complex financial transactions and money laundering schemes and will continue to vigorously pursue those individuals who victimize their investors and violate the public trust. Today’s sentencings demonstrate the government’s determination to restore and ensure that trust.”

The evidence presented at trial proved that between 2005 and November of 2009, the defendants, along with Cook, defrauded investors by soliciting them to invest money in a foreign currency trading program that they alleged would earn a double-digit rate of return, typically between 10.5 and 12 percent annually, with little or no risk. They also claimed investor assets would be held in a segregated account and could be withdrawn at any time. Those representations were false.

The defendants and Cook made the investment offers through entities known as Universal Brokerage Services or bearing the acronym “UBS.” (The UBS entities had no legitimate affiliation to the global provider of financial services UBS, AG.) Cook operated the currency program through various foreign currency trading firms, including but not limited to one in Chicago and another in Switzerland.
To induce investors, the defendants and Cook, directly or through others, made false representations regarding the performance, safety, and liquidity of the currency program. They also omitted material information concerning their own backgrounds and qualifications as well as the backgrounds and qualifications of those working for them.

Once investments were made, some investors received UBS account statements that indicated that the currency program was performing as promised, while others received checks for “returns on their investments.” Both the statements and checks, however, were actually produced by the co-conspirators, the purpose being to lull investors or encourage them to make additional investments. At the same time, most investors received nothing from the true custodians of their funds.

Although some investment funds were invested in foreign currency trading, most of that trading was high risk in nature, often resulting in significant losses, none of which was disclosed to investors. Moreover, the co-conspirators concealed that the currency trading firm in Switzerland was in dire financial condition and, instead, continued to solicit investor assets to be sent to that trading firm. Co-conspirators also concealed from investors their own concerns about Cook’s operation of the currency program and alleged illegalities relative to the currency program.

In 2007, when UBS, AG, filed a trademark infringement lawsuit against Cook, Durand, Kiley, and others, the defendants began operating their scheme under other names, including but not limited to those identified by the terms “Oxford” and “Universal Brokerage FX.” They then continued to solicit investors for the currency program, utilizing telemarketing, media spots, and seminars in which they repeated the false representations noted above. Kiley, a Christian radio host, solicited investors for the scam through his radio talk show, which was carried on more than 200 stations across the country. On those programs, he regularly warned listeners to avoid financial ruin by giving their life savings to his company for investment.

Between 2005 and July 2009, the defendants, the defendants, Cook, and others secured approximately $194 million in investments for the currency program. Of that amount, only about $109 million was actually sent to currency trading firms. About $52 million was paid to investors in the form of lulling payments, and approximately $30 million was diverted to fund the business and personal expenses of the defendants, Cook, and others.

While Beckman was soliciting investors for the currency program, he also was attempting to purchase a minority ownership interest in the Minnesota Wild hockey team. He made misrepresentations to the National Hockey League that investments in certain trading accounts were his alone. He also claimed an extraordinary amount of assets under management and lied about the management of his grandfather’s estate and other acts reflecting dishonesty.

Moreover, Beckman filed false individual income tax returns for tax years 2007 and 2009 and failed to file a tax return for 2008. For that year, Beckman and his wife owed more than $1.3 million in federal income taxes. In addition, he caused two life insurance policies of an investor to be sold and stole millions of dollars in proceeds in order to prop up currency trading accounts held in his name.

For his part, Durand concealed more than $20,000 from the court-appointed receiver, who was searching for assets of the currency program fraud. Durand had another individual exchange the Swiss francs for U.S. currency, thereby concealing from law enforcement that he was in truth the source of the funds. Furthermore, Durand filed false individual income tax returns for tax years 2006 through 2008.

In his plea agreement, Pettengill admitted that from February through September of 2008, he concealed material information from investors concerning the foreign currency program sold by Pettengill, Cook, and others known as the Oxford Entities Currency Program. He also conducted numerous wire transfers during the course of the conspiracy and made a personal credit card payment of $11,369.19 with funds derived from proceeds of the fraud scheme.

In August of 2010, Cook was sentenced to 300 months in federal prison for his role in the scam. On July 18, 2011, Jon Jason Greco pleaded guilty to two counts of making false statements to federal agents, specifically lying about assets he had concealed relative to this scam. He was sentenced to ten months in prison for his crimes.

This case was the result of an investigation by the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigations, with cooperation from the Securities and Exchange Commission and the Commodities Futures Trading Commission. It was prosecuted by Assistant U.S. Attorneys Tracy L. Perzel and David J. MacLaughlin.

Proceeds from the Cook fraud scheme are the subject of an ongoing investigation and recovery efforts led by R.J. Zayed, of the law firm Carlson, Caspers, Vandenburg, and Lindquist. Zayed was appointed Receiver by Judge Davis.

This law enforcement action is in part sponsored by the interagency Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated, and proactive effort in investigating and prosecuting financial crimes. It includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch and, with state and local partners, will investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

 

 

MINNEAPOLIS—Today in federal court, Mohamed Abdi, a former payroll service provider, pleaded guilty to one count of tax evasion. Abdi, who was indicted on April 9, 2012, entered his plea before United States District Judge John R. Tunheim.

From January 1, 2005 through June 2007, Abdi was the sole owner of Siham Solutions, Inc., which provided payroll services to clients in Minnesota. These services included paying federal income and employment taxes withheld from employees of Siham’s clients to the Internal Revenue Service (“IRS”) on a quarterly basis. In his plea agreement, Abdi acknowledged that from the first quarter of 2005 through the second quarter of 2007, he received between $80,000 and $200,000 of payments from clients that were supposed to be paid to the IRS. Instead, Abdi used the money received from his clients for his own purposes.

In particular, during the third quarter of 2006, Abdi received $3,817.12 from a Siham client, United Care Inc., which he agreed to pay to the IRS on United Care’s behalf on October 15, 2006. Instead, Abdi took the money and used it for other purposes.    

For his offenses, Abdi faces a potential maximum penalty of five years in federal prison, as well as possible fines and an order of restitution. Judge Tunheim will determine his sentence at a future hearing, not yet scheduled.

This case is the result of an investigation by the IRS-Criminal Investigation Division. It is being prosecuted by Assistant U.S. Attorney Michael L. Cheever.

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.

 

 

FOR IMMEDIATE RELEASE

February 6, 2012

MINNEAPOLIS – Earlier today in federal court, a 27-year-old man from Westerville, Ohio, pleaded guilty to conspiring to provide money and personnel to al-Shabaab, a designated foreign terrorist organization based in Somalia. Ahmed Hussein Mahamud, formerly of Eden Prairie, Minnesota, pleaded guilty to one count of conspiracy to provide material support to a foreign terrorist organization. Mahamud, who was indicted on June 7, 2011, entered his plea before
United States District Court Chief Judge Michael J. Davis.

In his plea agreement, Mahamud admitted that from 2008 through February of 2011, he conspired with others to provide money and people to al-Shabaab, a U.S.-designated foreign terrorist organization, in its fight against the Transitional Federal Government of Somalia
(“TFG”) and the Ethiopian military, which supports the TFG. The defendant also admitted that he and his co-conspirators raised money from the Somali-American community in Minnesota under false pretenses to pay for men in Minnesota to travel to Somalia to join al Shabaab.

Specifically, the defendant and his co-conspirators claimed the money raised would be used for a local mosque or to help orphans in Somalia. In fact, the money collected was used to purchase airline tickets and to pay other expenses so men could travel from Minnesota to Somalia to join al-Shabaab.

Further, Mahamud admittedly sent money via wire transfers to a co-conspirator in Somalia, knowing the money would be used to purchase weapons or otherwise support al-Shabaab.

Court documents indicate that since September of 2007, approximately 20 young men have left the Minneapolis area for Somalia, where they have trained with al-Shabaab. The charges against Mahamud stem from an ongoing, three-year investigation into that activity. To date, 18 people have been charged in the District of Minnesota in unsealed indictments or criminal complaints. Eight of those individuals have been arrested in the U.S. or overseas; of these eight, seven have pleaded guilty to related charges. Of the remaining ten defendants, eight are at large and believed to be abroad, while two others are believed to have died in Somalia. The charge levied against Mahamud carries a potential maximum sentence of 15 years in federal prison. A federal judge will determine the actual sentence at a hearing not yet scheduled.

This case was investigated by the FBI’s Minneapolis Joint Terrorism Task Force (“JTTF”), with assistance from the FBI’s JTTF in Columbus, Ohio. It is being prosecuted by Assistant U.S.
Attorneys Charles J. Kovats, Jr. and John Docherty and Trial Attorney William M. Narus of the
Counterterrorism Section of the Justice Department’s National Security Division.

 

 

Earlier today in federal court in the District of Minnesota, a jury found two Rochester, Minn., women guilty of providing material support to al-Shabaab, a designated terrorist organization.

Following a 10-day trial, the jury convicted Amina Farah Ali, 35, and Hawo Mohamed Hassan, 64, both naturalized U.S. citizens from Somalia, of one count of conspiracy to provide material support to a designated terrorist organization. In addition, Ali was convicted of 12 counts of providing material support to al-Shabaab, while Hassan was also convicted of two counts of making false statements to authorities.

Ali was detained by authorities following today's verdict. Hassan was also detained but will be shortly transferred to a half-way house.

The evidence admitted at trial established that the defendants provided support to al-Shabaab from Sept. 17, 2008, through July 19, 2010. Specifically, the evidence established that Ali communicated by telephone with al-Shabaab members in Somalia who requested financial assistance for al-Shabaab. Ali, Hassan and others raised money for al-Shabaab by soliciting funds door-to-door in Somali communities in Minneapolis, Rochester, and other cities in the United States and Canada. In addition, the defendants raised money by participating in teleconferences that featured speakers who encouraged donations to support al-Shabaab. Ali also raised funds under the false pretense that the funds were for the poor and needy.

Ali and others then transferred funds to al-Shabaab through various money remittance companies. Ali and others used false names to identify the recipients of the funds in order to conceal that the funds were being provided to al-Shabaab. The indictment lists 12 money transfers directed to al-Shabaab by Ali.

The defendants and others committed several overt acts in order to carry out the fund-raising conspiracy. For example, on Oct. 26, 2008, Ali hosted a teleconference during which an unindicted co-conspirator told listeners that it was not the time to help the poor and needy in Somalia; rather, it was time to give to the mujahidin. Ali and Hassan recorded $2,100 in pledges at the conclusion of the teleconference. On Feb. 10, 2009, Ali conducted another fund-raising teleconference during which she told listeners to "forget about the other charities" and focus on "the jihad."

On July 14, 2009, the day after the FBI executed a search warrant at her home, Ali telephoned her primary al-Shabaab contact, saying, "I was questioned by the enemy here . . . . they took all my stuff and are investigating it . . . do not accept calls from anyone." In addition, when Hassan was questioned by agents in an investigation involving international terrorism, she made false statements.

For their crimes, the defendants face a potential maximum penalty of 15 years in prison for the charge of conspiracy to provide material support to a designated terrorist organization. Ali also faces a potential 15 years for each count of providing material support to a terrorist organization, while Hassan faces a potential eight years for each count of making a false statement. U.S. District Court Chief Judge Michael J. Davis will determine their sentences at a future hearing, yet to be scheduled.

This case is the result of an investigation by the FBI's Joint Terrorism Task Force. It is being prosecuted by Assistant U.S. Attorney Jeffrey S. Paulsen and Steven Ward of the Counterterrorism Section of the Justice Department's National Security Division.