Eastern District of Missouri

St. Louis, MO – PETER GIAMBALVO was sentenced to 16 months in prison for filing false tax returns from 2003-2010.

According to testimony presented at trial, Giambalvo was an employee of The Boeing Company. For eight years beginning in 2003 through 2010, Giambalvo claimed zero earnings, when in fact he had earned wages, salaries, tips, etc. of approximately $498,540 for those years.

"The legality of our income tax laws has been challenged time and time again and the courts have consistently upheld these laws," said Tanya Brewer, Acting Special Agent in Charge of IRS Criminal Investigation.

Giambalvo, Hawk Point, MO, was convicted last August on one felony count of interfering with the administration of the Internal Revenue laws, and eight felony counts of filing false tax returns. He appeared today for sentencing before United States District Judge Rodney W. Sippel. 

This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Steven Muchnick handled the case for the U.S. Attorney's Office.         

St. Louis, MO – BRYAN BINKHOLDER pled guilty to multiple fraud charges involving his financial planning and investment strategy businesses.

According to court documents, Binkholder labeled himself "The Financial Coach" and provided investment and financial planning advice to the general public through his affiliated websites, YouTube channel, published books and articles and an investment related talk-radio show that aired on local radio stations. In 2008, he developed a real estate investment he termed "hard money lending."  Using his platform as an investment advisor and financial talk show host, Binkholder solicited his clients and others to invest in the hard money lending program.  As part of his sales pitch, he represented that he had relationships with developers in the real estate community who wanted to purchase, renovate and sell residential real estate in the St. Louis area, but were not able to secure financing from traditional banks.  As part of the hard money lending program, Binkholder told investors that they would invest money with him, and he would act as a bank and provide short-term loans to these developers at a high rate of interest, which would be shared with the investor.  Instead of exclusively making hard money loans as promised, he used millions of dollars of investor money, made only a small number of hard money loans and caused investors to lose more than $3,000,000.

Binkholder, Wentzville, MO, pled guilty to four felony counts of wire fraud and one felony count of bank fraud before United States District Judge Ronald L. White. Sentencing has been set for April 10, 2015.

Each of these charges carries a maximum penalty of 20 years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

  This case was investigated by the Federal Bureau of Investigation and the Postal Inspection Service. Assistant United States Attorney Stephen Casey is handling the case for the U.S. Attorney’s Office.

St. Louis, MO – BRADLEY FERGUSON, owner of Fenton-based Paymaster Business Solutions, Inc., was sentenced to 54 months in prison on mail fraud and money laundering charges involving his failure to remit federal, state and local taxes to the proper taxing authorities that had been deducted from victim client bank accounts.  Ferguson also failed to remit FICA withholding to the IRS on behalf of his business clients.  Ferguson’s clients included churches, youth organizations, child daycare facilities, law firms and other businesses throughout the St. Louis area.  In addition to the prison sentence, he was ordered to pay restitution of $3,067,137.

According to court documents, from January 2005 through January 2014, Ferguson drafted funds directly from Paymaster business clients’ bank accounts in order to pay their federal, state and local tax liabilities.  However, Paymaster, at Ferguson’s direction, failed to forward the Paymaster business clients’ funds to the taxing authorities in order to pay their tax liabilities then due and owing.  Paymaster drafted in excess of $2,700,000 from Paymaster business clients’ bank accounts to pay client’s federal, state and local tax liabilities, as well as FICA liabilities, for the period July 2013 through December 2013, but were not forwarded to the proper taxing authorities. Additionally, Ferguson,as Power of Attorney for Paymaster business clients, was contacted directly by the IRS and questioned as to the failure of the payments of client federal tax liabilities.  Fergusondid not tell his clients about the IRS inquiries.  When clients occasionally learned that Paymaster had not forwarded their funds to the taxing authorities, Ferguson lied to them and told them Paymaster had made the payments. In December 2013, Ferguson retained the services of a commercial shredding company and directed that the Paymaster business client records be shredded and removed from the Paymaster offices.

Ferguson, Washington, MO, pled guilty last August to one felony count of mail fraud and one felony count of money laundering, He appeared today for sentencing before United States District Judge E. Richard Webber. 

This case was investigated by the Federal Bureau of Investigation, Postal Inspection Service and Internal Revenue Service Criminal Investigation. Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney's Office.            

St. Louis, MO – HUBOLIST ELLIOTT was indicted for mail fraud in connection with a real estate investment scheme involving fractional interests in vacation properties.

According to the indictment, between 2009 and 2014, Elliott, and his company, Travel World Vacations, Inc., offered investment opportunities in vacation properties in Florida.  The investment opportunity typically involved a fractional real estate transaction which Elliott and Travel World Vacations, Inc., presented to investors as an opportunity to purchase and own a deeded interest in a specific vacation property.  As part of the alleged scheme, typically neither Elliott nor Travel World Vacations, Inc. owned any interest in the properties being offered to investors as available for a fractional real estate purchase.  In some instances, the real property represented as an opportunity for investment and ownership did not exist.  In other instances, the real property represented as an opportunity for investment and ownership did exist but neither Elliott nor Travel World had a legal interest, fractional or otherwise, that could be conveyed to an investor or any right to enter into a transaction regarding that property.

The indictment further alleges that ten or more investors, including one investor from the St. Louis area, invested in Elliott’s fractional real estate scheme.  Expected losses as a result of the scheme total more than $1,000,000.

Elliott, of Cary, North Carolina, was indicted by a federal grand jury on December 10th on one felony count of mail fraud.  The indictment remained sealed until the defendant’s arrest, which occurred in North Carolina on December 29, 2014.  His first court appearance in the Eastern District of Missouri was earlier today.

If convicted, this charge carries a maximum penalty of 20 years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation and the U.S. Postal Inspection Service.  United States Attorney Charles Birmingham is handling the case for the U.S. Attorney’s Office.  

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – HUBOLIST ELLIOTT was indicted for mail fraud in connection with a real estate investment scheme involving fractional interests in vacation properties.

According to the indictment, between 2009 and 2014, Elliott, and his company, Travel World Vacations, Inc., offered investment opportunities in vacation properties in Florida.  The investment opportunity typically involved a fractional real estate transaction which Elliott and Travel World Vacations, Inc., presented to investors as an opportunity to purchase and own a deeded interest in a specific vacation property.  As part of the alleged scheme, typically neither Elliott nor Travel World Vacations, Inc. owned any interest in the properties being offered to investors as available for a fractional real estate purchase.  In some instances, the real property represented as an opportunity for investment and ownership did not exist.  In other instances, the real property represented as an opportunity for investment and ownership did exist but neither Elliott nor Travel World had a legal interest, fractional or otherwise, that could be conveyed to an investor or any right to enter into a transaction regarding that property.

The indictment further alleges that ten or more investors, including one investor from the St. Louis area, invested in Elliott’s fractional real estate scheme.  Expected losses as a result of the scheme total more than $1,000,000.

Elliott, of Cary, North Carolina, was indicted by a federal grand jury on December 10th on one felony count of mail fraud.  The indictment remained sealed until the defendant’s arrest, which occurred in North Carolina on December 29, 2014.  His first court appearance in the Eastern District of Missouri was earlier today.

If convicted, this charge carries a maximum penalty of 20 years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation and the U.S. Postal Inspection Service.  United States Attorney Charles Birmingham is handling the case for the U.S. Attorney’s Office.  

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – MARK KISTLER, of St. Louis County, was indicted today for bank fraud in connection with the financial exploitation of an elderly person. 

According to the indictment, Kistler met the victim, identified as N.W., who was a patient at his father’s medical practice.  Kistler initially did errands and jobs for N.W. and eventually began to pressure N.W. to give him money.  Between 2007 and 2011, Kistler, with the help of his mother and two girlfriends, is alleged to have taken more than $200,000 from N.W. and continues to live rent free in a St. Louis county house purchased with N.W.’s funds and titled in his mother’s name.

The bank fraud is alleged to have involved arrangement of a straw purchase of a St. Louis city house using N.W.’s funds. The mother of Kistler’s then-girlfriend is alleged to have been recruited as the straw buyer or nominal buyer of the property because Kistler and his girlfriend had poor credit.  When Kistler and his girlfriend stopped making payments on the property, the house was foreclosed upon and the lender suffered a $92,000 loss.

If convicted, bank fraud carries a maximum penalty of 30 years in prison and/or fines up to $1 million. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

Additionally, restitution will be sought for N.W. and the victim financial institution. 

The case was investigated by the FBI and the U.S. Postal Inspection Service in cooperation with the Missouri Secretary of State Securities Enforcement Section, which is pursuing a civil enforcement action against Kistler. Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.  

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.        

St. Louis, MO – MARK AVALOS pled guilty to bank fraud charges relating to his work as the Controller for The Mortgage Store, Inc. (TMS) in 2008.

According to court documents, TMS was a major mortgage brokering business with offices in four states and hundreds of employees.  The main offices were in Westport Plaza and Wentzville.  The businesses were operating at a financial deficit in 2008. There were not sufficient funds available to fund the disbursements from TMS and, in addition, to meet all of the expenses incurred by TMS. In order to meet certain expenses and, at the same time, conceal the absence of adequate funds, Avalos and others at TMS caused insufficient funds checks drawn on the checking accounts of both TMS and Title America to be deposited between those accounts in such a way that the “float” concealed the true balances of each account.  The accounts were at Enterprise Bank in Clayton and at the First Bank of the Lake in Osage Beach, Missouri.  The TMS account had a negative balance of approximately $850,000 in June, 2008, when the banks stopped accepting the floated checks. TMS went out of business shortly thereafter.

Avalos, St. Peters, Missouri, pled guilty to one felony count of bank fraud before United States District Judge Henry E. Autrey.  Sentencing has been set for March 16, 2015.

He now faces a maximum penalty of 30 years in prison and/or fines up to $1 million. (Although court documents show that the parties are requesting a lesser sentence due, in part, to Avalos’ cooperation in the investigation.)  In determining the actual sentence, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

Jason Rauschelbach and John York, the owners of TMS, pled guilty earlier this year to charges stemming from the TMS business.  Rauschelbach is presently serving a 24-month prison sentence following that guilty plea and York is scheduled to be sentenced on February 2, 2015.

This case was investigated by the FBI, IRS Criminal Investigation and the Inspector General Offices of HUD and the Department of Labor, as well as the Postal Inspection Service. Assistant United States Attorney James E. Crowe, Jr., is handling the case for the U.S. Attorney's Office.

St. Louis, MO – ANTHONY DAVIS, president of Mail Handlers Local 314, was sentenced to 21 months in prison and ordered to pay full restitution on charges involving his embezzlement of approximately $42,166 of union funds by using fake invoices submitted for payment. 

Davis, O’Fallon, IL, was convicted in September of one count of embezzlement of Labor Union funds.  He appeared today for sentencing before United States District Judge Carol E. Jackson.

This case was investigated by the U.S. Department of Labor Office of Inspector General and Office of Labor-Management Standards.  Assistant United States Attorneys Dianna Collins and John Ware handled the case for the U.S. Attorney's Office.

St. Louis, MO – Four Russian nationals have been indicted for conspiring to travel from Russia to casinos across the United States, including several local casinos, to cheat at particular slot games using electronic devices.

According to the indictment, the charged defendants engaged in a conspiracy to cheat at least 10 casinos in Missouri, California and Illinois through the use of electronic devices. The devices were used to predict the behavior of a certain make and model of slot machine game known as the Aristocrat Mark VI Electronic Gaming Device. By communicating with a foreign server, the devices allowed the defendants to predict the behavior of the Mark VI games and obtain winnings from the games that far exceeded what would be expected from fair play. The defendants made multiple trips from Russia to the United States in order to carry out their scheme, using the devices to cheat casinos in St. Louis, Missouri; Temecula, California; and East St. Louis, Illinois, among others.

MURAT BLIEV; YEVGENIY NAZAROV; IGOR LAVRENOV; and IVAN GUDALOV were indicted by a federal grand jury on charges of traveling in interstate and foreign commerce in furtherance of the conspiracy. Bliev, Lavrenov, and Gudalov are all believed to reside in Moscow, Russia. Nazarov is a U.S. citizen residing in Miami, Florida.

If convicted, each count of the indictment carries a maximum penalty of five years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation with assistance from Homeland Security Investigations, Immigration and Customs Enforcement, the Missouri Highway Patrol, the Missouri Gaming Commission, the Illinois State Police, the Illinois Gaming Board and the California Department of Justice, Bureau of Gambling Control. Assistant United States Attorney Richard E. Finneran is handling the case for the U.S. Attorney’s Office. 

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – BRIAN PALUCH, former Chief Financial Officer & Senior Vice President of PARIC Construction was indicted on three charges of mail fraud involving his scheme to use the company’s corporate funds to pay his own personal expenses during the period January, 2010 through February, 2014.

According to the indictment, Paluch used the PARIC issued American Express card to pay for personal expenses, including personal travel, dining, spa charges, electronics and personal gifts for family and friends.  In order to conceal his scheme, Paluch submitted false and altered financial summaries of the monthly American Express statements by deleting and altering his own personal charges.  On several occasions, Paluch forged the PARIC President’s signature on these false financial summaries as purported authorization for the payments.  Additionally, as part of his employment at PARIC, Paluch was permitted to join the Sunset Country Club, and PARIC paid the monthly membership dues.  Paluch, on behalf of PARIC, entered into an agreement with Sunset for the purchase of various types of apparel and golf items containing the PARIC corporate logo. The indictment alleges that Paluch created sham and inflated Sunset Country Club invoices to pay for personal items at the club unrelated to the legitimate business of PARIC. In his position as CFO, Paluch was responsible for calculating the annual bonuses for PARIC’s employees, including his own.  As a further part of his scheme, Paluch inflated his base salary in calculating his own annual bonus for several years.  Paluch also assisted a PARIC employee issue corporate checks to pay for the employee’s daughter’s private school tuition without PARIC’s knowledge.  Additionally, during Summer, 2011, Paluch directed the payment of $5,000 in PARIC corporate funds to a St. Louis area law firm as an incentive for that law firm to hire his niece as a summer associate. 

Paluch, Kirkwood, Missouri, was indicted by a federal grand jury on three felony counts of mail fraud.  He is expected to appear in federal court later this week.

If convicted, each count of the indictment carries a maximum penalty of 20 years in prison and/or fines up to $250,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Postal Inspection Service, the Federal Bureau of Investigation and Internal Revenue Service-Criminal Investigation.   Assistant United States Attorney Hal Goldsmith is handling the case for the U.S. Attorney’s Office.  The victim, PARIC Construction Company, provided assistance in the investigation.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO –ABSALOM CARLISLE, formerly of St. Louis, was arrested late yesterday on a federal indictment alleging mail fraud and aggravated identity theft in connection with the care of an elderly Clayton man between 2010 and 2013. 

According to the indictment, Carlisle arranged to care for the elderly victim, who is now deceased, through a health services company he owned.  Soon after beginning to care for the victim, Carlisle added a second American Express card to the victim’s account and began making personal charges.  From time to time, Carlisle would steal funds from the victim’s bank accounts to pay down his American Express bills.  In all, Carlisle stole more than $50,000 from the victim.  Carlisle’s malfeasance was discovered by the victim’s children after his death.

If convicted, mail fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000 and each count of aggravated identity theft carries a penalty of two years and /or fines up to $250,000.  In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Postal Inspection Service.  Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney's Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – MELANIE ANN MAHANEY was sentenced to 39 months in prison on multiple fraud charges involving bank fraud and aggravated identity theft. 

According to court documents, between March 8, 2013 and April 19, 2013, Mahaney was recruited to impersonate car burglary victims in a bank fraud scheme.  During the course of the scheme, she received stolen drivers licenses, social security cards, personal checks, credit and debit cards and other forms of identification which had been stolen by others from the vehicles.  Using the stolen identification of car burglary victims, Mahaney cashed checks stolen from other car burglary victims at banks located in the St. Louis Metropolitan Area and the Southern District of Illinois.

Mahaney, Crossville, Tennessee, pled guilty in July to one felony count of bank fraud and a felony count of aggravated identity theft. She appeared today for sentencing before United States District Judge Audrey G. Fleissig. 

This case was investigated by the U.S. Postal Inspection Service.  Assistant United States Attorney Tracy Berry handled the case for the U.S. Attorney's Office.

St. Louis, MO – GARY A. DOTSON was sentenced to 24 years in prison for child exploitation and child pornography offenses.

According to court documents, between 2010 and 2012, Dotson produced child pornography involving one victim and attempted to produce child pornography involving another victim.  Both victims were under the age of twelve at the time of the offense.  In addition, between 2011 and 2012, Dotson actively participated in an online community centered on trafficking in child pornography. Within this community, Dotson received and transported child pornography over the internet on an almost daily basis.  As he traded child pornography, Dotson also repeatedly notified community members that he was seeking “custom” child pornography produced specifically for him.  One such notice included Dotson’s request that a member produce and send him an image of a child engaged in a sexual act while holding a sign with a message written specifically for him. 

Dotson, Pacific, Missouri, pled guilty in August to one felony count each of production of child pornography, attempted production of child pornography, notice and advertisement for child pornography, receipt of child pornography and transportation of child pornography.  He appeared today for sentencing before United States District Judge John A. Ross.

This case was investigated by the Federal Bureau of Investigation, the Franklin County Sheriff’s Department and the Regional Computer Crimes Education and Enforcement Group (RCCEEG).  Assistant United States Attorney Charles Birmingham prosecuted the case for the U.S. Attorney's Office.

St. Louis, MO – The final defendant in a bribery/kickback scheme involving Boeing military aircraft parts, JEFFREY LAVELLE, owner and operator of J. L. Manufacturing, was sentenced to 15 months in prison and ordered to pay a $50,000 fine. J.L. Manufacturing of Everett, Washington, is an aerospace job machine shop specializing in hard metals, with the capability of producing small to medium sized complex parts of ferrous and non-ferrous materials, and was a sub-contractor to Boeing on numerous United States government F-15 fighter jet contracts. 

Over several years, Lavelle and his co-defendant Robert Diaz, Jr. made cash payments to co-defendant Deon Anderson, a Boeing Procurement Officer, in exchange for non-public company financial and bid information.  J.L. Manufacturing obtained approximately $2,000,000 in Boeing subcontracts through the bribery scheme, while Deon Anderson was paid approximately $250,000 from J.L. Manufacturing and another subcontractor located in the Los Angeles, California, area through the scheme.

Last month, former Boeing Procurement Officer Deon Anderson was sentenced to 20 months in prison in connection with a bribery/kickback scheme involving Boeing military aircraft parts, as well as structuring currency transactions to conceal his receipt of the cash bribes. Co-defendants William P. Boozer, Hacienda Heights, CA, was sentenced to 18 months in prison and fined $10,000; and Robert Diaz, Jr., Alta Loma, CA, was sentenced to 15 months in prison and fined $2000.

All defendants were sentenced by United States District Judge Henry Autrey in St. Louis. 

This case was investigated by Defense Criminal Investigative Service, Federal Bureau of Investigation, NASA-Office of Inspector General, Air Force Office of Special Investigations, Navy Criminal Investigative Service, and Internal Revenue Service Criminal Investigation.  Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney’s Office.

St. Louis, MO – DORA ARGYROPOULOS was indicted for executing a scheme to defraud American banks by opening accounts for sham businesses and incurring more than a million dollars in overdrafts on those accounts from abroad.

According to the indictment, Argyropoulos and her confederates registered numerous businesses and fictitious registrations with state authorities in order to be able to apply for checking accounts at no fewer than ten American banks. These businesses, however, never had any substantial operations. Instead, Argyropoulos and her confederates would return to Greece and utilize debit cards connected to the businesses’ accounts to cause massive overdrafts for travel and entertainment expenses. The transactions were timed in such a way as to take advantage of American banking procedures relating to the debiting and posting of such expenses. As a result, Argyropoulos and her confederates incurred overdrafts and overdraft fees on the accounts totaling at least $1,745,405.

Argyropoulos, of Athens, Greece, was arrested on November 9 in Miami, Florida, upon her entry into the country. Late yesterday, she was indicted by a federal grand jury in the Eastern District of Missouri on two felony counts of bank fraud, one felony count of wire fraud and one count of conspiracy to commit those crimes.

If convicted, each count of the indictment carries a maximum penalty of 30 years in prison and/or fines up to $1 million. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.  

This case was investigated by the Federal Bureau of Investigation and the U.S. Secret Service. Assistant United States Attorney Richard Finneran is handling the case for the U.S. Attorney’s Office.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – Assistant United States Attorney Nicholas Llewellyn, Chief of the Civil Division, announced today that the Eastern District of Missouri collected $9,437,113 in criminal and civil actions in Fiscal Year 2014.  Of this amount, $7,293,407 was collected in criminal actions and $2,143,706 was collected in civil actions

Additionally, the Eastern District of Missouri worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional$1,877,106 in cases pursued jointly with these offices.    Of this amount, $5,457 was collected in criminal actions and $1,871,649 was collected in civil actions.         

Attorney General Eric Holder announced on November 19, 2014 that the Justice Department collected $24.7 billionin civil and criminal actions in the fiscal year ending September 30, 2014. The more than $24 billion in collections in FY 2014 represents nearly eight and a half times the appropriated $2.91 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.

"Every day, the Justice Department’s federal prosecutors and trial attorneys work hard to protect our citizens, to safeguard precious taxpayer resources and to provide a valuable return on investment to the American people," said Attorney General Holder.  "Their diligent efforts are enabling us to achieve justice and recoup losses in virtually every sector of the U.S. economy.  And this result shows the fruits of the Justice Department’s tireless work in enforcing federal laws; in protecting the American people from violent crime, national security threats, discrimination, exploitation and abuse; and in holding financial institutions accountable for their roles in causing the 2008 financial crisis."   

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.

Additionally, the U.S. Attorney's office in the Eastern District of Missouri, working with partner agencies and divisions, collected $4,393,864 in asset forfeiture actions in FY 2014. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.

St. Louis, MO – RANDALL HINTON was indicted in August on multiple fraud charges involving his scheme to alter and counterfeit documents in order to obtain state issued motor vehicle titles for himself and others.  Last week, twelve additional individuals were indicted in two separate indictments for their part in the use of the altered and counterfeited documents to obtain motor vehicle titles and motor vehicle title loans. 

According to the indictments, the schemes involving the defendants resulted in financial losses to the State of Missouri, financial institutions, title loan companies and individuals.  As the documents were often altered to decrease the value of the vehicles or to change the state of residence of the vehicle owners to addresses in Illinois, the owners of the vehicles were able to evade paying the appropriate taxes and license fees to the Department of Revenue for the State of Missouri.  When Hinton removed the names of financial institutions which had financed the purchases of the vehicles from legitimate titles, Hinton, Arronda Williams and others were able to sell the vehicles to innocent purchasers who were then unable to register the vehicles due to existing liens.  The final aspect of the scheme enabled individuals to use the altered documents to obtain motor vehicle title loans from companies located throughout the United States.  As a result of existing liens or the fact that the value of the vehicles was less than the defendants represented, the title loan companies experienced large financial losses. 

In a superseding indictment filed last week, Hinton, St. Louis, Missouri, was indicted by a federal grand jury on one felony count of conspiracy to defraud, three felony counts of mail fraud, three felony counts of interstate transportation of falsely made securities, two felony counts of aggravated identity theft and one felony count of making a false statement.  Arronda Williams, St. Louis, was charged in a separate indictment by a federal grand jury on one felony count of conspiracy to defraud, two felony counts of mail fraud, two felony counts of wire fraud, two felony counts of pledging falsely made securities and one felony count of aggravated identity theft

The following co-defendants were also indicted by a federal grand jury last week on related charges.  The indictments were sealed until earlier today:

• BRYNESHA HINTON, St. Louis, Missouri
• KELITA OZIER, St. Louis, Missouri
• MARQUITA STALLINGS, St. Louis, Missouri
• CATHERINE CRAWFORD, St. Louis, Missouri
• ROBERT WILLIAMS, St. Louis, Missouri
• JUSTINE CARTER, St. Louis, Missouri
• KIERA HALL, St. Louis, Missouri
• TY'ANDRA WILLIAMS, St. Louis, Missouri
• ESSICA GRIFFIN, St. Louis, Missouri
• NADAUNTE BROWN, St. Louis, Missouri
• DAVON STEWART, St. Louis, Missouri

If convicted, these charges carry a penalty range of up to 20 years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Postal Inspection Service, Missouri Department of Revenue, Illinois Secretary of State, Social Security Administration-Office of Inspector General-Office of Investigations and the St. Louis Metropolitan Police Department.  Assistant United States Attorney Tracy Berry is handling the case for the U.S. Attorney's Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – MARSHA HARRINGTON; CALVIN SHAW and LARRY CORNER, all of the St. Louis area, have been sentenced on charges of conspiracy to commit identity theft and identity theft.  Shaw was sentenced late yesterday to 30 months in prison; Harrington was sentenced to 12 months and one day in prison on October 14; and Shaw was sentenced to 24 months prison on November 3.  All defendants appeared before United States District Judge Catherine D. Perry. 

According to court documents, Marsha Harrington obtained the personal identity information of others, including names and social security numbers, which she used to prepare and file false federal income tax returns and false W-2 forms. In some instances, Harrington obtained the identity information herself.  For example, tenants at the Clinton-Peabody Housing Complex provided Harrington, who was the leasing manager at the time, their identity information for use in the fraudulent tax returns.  Co-defendants Calvin Shaw and Larry Corner also provided identity information to Harrington.  Harrington charged a fee to file the false tax returns.  If the tax return used a name and social security number provided by Shaw and/or Corner, she shared those funds with them respectively.

This case was investigated by IRS Criminal Investigation and HUD Office of Inspector General. Assistant United States Attorney Stephen Casey handled the case for the U.S. Attorney's Office.

St. Louis, MO – The owner and operator of a St. Louis County tax preparation service was sentenced for filing false returns and stealing the identities of taxpayers.

RONALD SHONIWA, of Florissant, Missouri, was sentenced to 30 months imprisonment for a stolen identity and tax fraud scheme he perpetrated as the owner of Rapid Tax Service in St. Louis County between 2009 and 2012. 

According to the plea agreement, Shoniwa filed 48 false tax returns calling for $188,414 in improper refunds between 2009 and 2012.   The refunds were generated by Shoniwa’s false entries as to income and educational expenses so that tax credits would be improperly paid to the individual filer.  On numerous occasions, Shoniwa admitted to identity theft by preparing these false returns without the knowledge or authorization of the individual listed on the return.

Shoniwa pled guilty to theft of government funds in July. He appeared today for sentencing before U.S. District Judge Carol E. Jackson. 

In addition to the term of imprisonment, Shoniwa was ordered to pay restitution to the United States in the amount of the false returns.  A native of Zimbabwe, Shoniwa was also ordered to cooperate in deportation proceedings.

"While most return preparers provide excellent service to their clients, a few unscrupulous tax preparers file false and fraudulent returns to defraud the government, the tax-paying public and their own clients," said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation.  "Protecting taxpayer dollars is a matter we take extremely seriously."

This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Tom Albus handled the case for the U.S. Attorney's Office.

St. Louis, MO – JOEY D. WOOD pled guilty to filing four false tax returns for himself and two others claiming refunds totaling over $23,000 for tax years 2011 and 2012.

According to court documents, Wood, who was engaged in the business of preparing income tax returns for individuals, filed false tax returns for himself claiming refunds for 2011 and 2012, and filed false returns claiming refunds for two other people for 2011.   Additionally, on May 17, 2013, Wood was in possession of a firearm.  Due to a previous felony conviction, he is prohibited from owning or possessing firearms.

"The object of this refund scheme was to steal from the government and the taxpaying public," said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation.  "The prosecution of these crimes is a vital element in maintaining public confidence in our tax system."

Wood, St. Louis County, Missouri, pled guilty to four felony counts of making false statements to the government and one felony count of being a previously convicted felon in possession of a firearm. He appeared before United States District Judge Catherine D. Perry.  Sentencing has been set for January 20, 2015.

Each of the tax counts carry a maximum penalty of 5 years in prison and/or fines up to $250,000, the firearms charges carries a maximum of 10 years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by IRS Criminal Investigation, the St. Louis County Police Department and the Missouri Department of Revenue. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney's Office.

St. Louis, MO – CHRISTOPHER CHANNEL was sentenced to 254 months in prison on charges of distribution of cocaine base and possession of a firearm in furtherance of a drug-trafficking crime, resulting in the killing of Carrie Henderson-Shaw. 

According to court documents, in the early morning hours of January 3, 2010, Channel sold cocaine base to Henderson-Shaw at a local gas station located on South Broadway in the City of St. Louis, Missouri.  Channel was in possession of a firearm during the drug transaction. After pulling off of the gas station lot, Henderson-Shaw suffered two gunshot wounds, ultimately resulting in her death, while her vehicle approached the entrance ramp to Interstate 55 from 7th Street. Channel acknowledged that Henderson-Shaw was shot dead as a result of the drug transaction. 

Channel pled guilty in July 2014, to the above federal charges and appeared today for sentencing before United States District Court Judge Carol E. Jackson.

This case was investigated the Bureau of Alcohol, Tobacco, Firearms and Explosives and the St. Louis Metropolitan Police Department. 

St. Louis, MO – OZKAN SEMIZOGLU, the “Foreign Trade Director” of a Turkish drug wholesaler, was sentenced to 27 months in prison for smuggling counterfeit, misbranded and adulterated cancer treatment drugs into the United States, including multiple shipments of Altuzan® (the Turkish version of Avastin®) that he sent from Turkey to Chesterfield, Missouri.

According to Semizoglu’s plea agreement, Semizoglu used shipping labels that concealed the illegal nature of the prescription drug shipments, including customs declarations falsely describing the contents as "gifts" or "documents" or “product sample” with no or low declared monetary values.  Semizoglu also ensured that large drug shipments were broken into several smaller packages to reduce the likelihood of seizures by U.S. Customs authorities and the corresponding loss of expensive drug shipments.  Additionally, Semizoglu shipped some prescription cancer treatment drugs that needed constant cold temperatures to maintain their stability and effectiveness in shipping boxes without insulation or any temperature protection whatsoever.  Given the length of time required to ship products from Turkey to Missouri, Semizoglu admitted he was aware that the packages would frequently arrive in the United States at temperatures outside the constant cold temperature range discussed on the drugs’ labeling. 

Further, Semizoglu admitted in his plea agreement to selling Altuzan® to Richard Taylor, a United Kingdom drug wholesaler.  The U.S. Food and Drug Administration’s (“FDA”) Office of Criminal Investigations (“FDA-OCI”) previously seized Altuzan® from various U.S. physicians and customers of Taylor in 2012. The FDA-OCI ultimately determined that this Altuzan® received from Taylor and Semizoglu was counterfeit, with no active drug ingredient in the drug vials.  FDA issued several public safety alerts about these events.  FDA-OCI’s ongoing investigation has led to a number of related prosecutions in this District, including Dr. Abid Nisar, Sandra Behe, James Newcomb, Richard Taylor, Dr. Erick Falconer, Greg Martin, Kamaldeep Sandhu and Navdeep Sandhu, as well as prosecutions in the Southern District of California and the District of Maryland. 

 "Today's sentencing marks a public recognition that we will continue to pursue and bring to justice those who violate the law and jeopardize public safety," said Philip J. Walsky, acting director, FDA Office of Criminal Investigations. "National borders can no longer keep out criminal activity.  As we did in this case, we will work with our international partners to protect U.S. public health."

This case was investigated by FDA’s Office of Criminal Investigations, with assistance from the United States Marshal’s Service, the United States Attorney’s Office for the District of Puerto Rico, the Office of Inspector General for the U.S. Department of Health and Human Services, the Johnson County, Kansas Sheriff’s Office Criminalistics Laboratory, Europol, the Bonn prosecutor in Germany (Staatsanwaltschaft); the Federal Criminal Police of Germany (Bundeskriminalamt, BKA); the Dusseldorf Police, the German State Criminal Police (Landeskriminalamt, LKA), the U.S. Department of State’s Diplomatic Security Service, the U.S. Consulate General’s Overseas Criminal Investigations Branch in Istanbul, Turkey, and the Drug Enforcement Administration. 

The case was prosecuted by the Health Care Fraud Unit of the U.S. Attorney’s Office for the Eastern District of Missouri.

St. Louis, MO – Former Boeing Procurement Officer DEON ANDERSON was sentenced to 20 months in prison in connection with a bribery/kickback scheme involving Boeing military aircraft parts, as well as structuring currency transactions to conceal his receipt of the cash bribes. Co-defendants WILLIAM P. BOOZER, Hacienda Heights, California, was sentenced to 18 months in prison and fined $10,000; and ROBERT DIAZ, JR., Alta Loma, California, was sentenced to 15 months in prison and was fined $2,000.

Boeing Company Defense Space and Security Division is a defense contractor providing military- style aircraft to the United States Department of Defense and the United States armed services, with offices and procurement operations located in St. Louis.  Deon Anderson was a Procurement Officer for Boeing, residing in the St. Louis area.

J. L. Manufacturing of Everett, Washington, is an aerospace job machine shop specializing in hard metals, with the capability of producing small to medium sized complex parts of ferrous and non-ferrous materials, and was a sub-contractor to Boeing on numerous United States government contracts.   Jeffrey Lavelle, owner and operator of J. L. Manufacturing, directed the day-to-day operations of the company, and oversaw all financial aspects of the company.

Inland Empire and Associates, Inc., Las Vegas, Nevada, is engaged in consulting to defense aircraft manufacturers and parts suppliers, including consulting for J. L. Manufacturing.  Robert Diaz, Jr. was the owner and operator of Inland Empire, and personally consulted to J. L. Manufacturing and Jeffrey Lavelle relative to numerous Boeing sub-contracts. 

Globe Dynamics International, Inc., Santa Ana, California, is a leader in producing small to large, close tolerance precision machined parts and the assembly of complex components.  Globe Dynamics was a sub-contractor to Boeing on numerous United States government contracts.  William Boozer, owner and operator of Globe Dynamics, directed the day-to-day operations of the company, including the submission of contract bids.

According to court documents and statements made in court, between November 2009 and February 2013, Boozer requested the Procurement Officer for Boeing, Deon Anderson, provide him with non-public competitor bid information and historical price information in connection with Boeing military aircraft part purchase order requests for quotes.  They communicated by telephone and e-mail between California and St. Louis in code on a regular basis, Boozer frequently requesting “Isle 5," a coded reference to a “price check on aisle 5," understood by Anderson to be a request for historical price information and competitor bid information.  Anderson gave the information to Boozer to be used in preparing and submitting bids on behalf of Globe Dynamics in response to approximately sixteen different Boeing requests for quotes relative to those various purchase orders, in exchange for cash payments. Of the sixteen bids Globe Dynamics was awarded seven purchase orders to supply United States military aircraft parts to Boeing totaling in excess of $1,500,000. The net benefit to Globe Dynamics on those seven purchase orders was approximately $116,339.

Beginning in May 2011 and continuing through April 2013, Deon Anderson provided J.L. Manufacturing, through Lavelle and Diaz, non-public competitor bid information and historical price information in connection with one and more Boeing military aircraft part purchase order requests for quotes.  Lavelle used that information in preparing and submitting bids on behalf of J.L. Manufacturing to Boeing for approximately nine different Boeing requests for quotes relative to those various purchase orders. Of those nine, J.L. Manufacturing was awarded seven purchase orders to supply United States military aircraft parts to Boeing totaling approximately $2,052,746.  In exchange for that information, they made cash payments to Anderson in St. Louis and in California.

Relative to the cash bribe payments he received, on more than one occasion Deon Anderson structured cash deposits into his personal checking account to conceal his bribe scheme.

Deon Anderson, St. Louis, Missouri, pled guilty to three felony counts of mail fraud, one felony count of wire fraud, and one felony count of currency structuring in June. Co-defendants William P. Boozer, Hacienda Heights, California, and Robert Diaz, Jr., Alta Loma, California, also previously pled guilty to related charges.  The defendants appeared today in St. Louis for sentencing before United States District Judge Henry Autrey.

Co-defendant Jeffrey Lavelle, Mukilteo, Washington, is scheduled for sentencing November 17, 2014.

This case was investigated by Defense Criminal Investigative Service, Federal Bureau of Investigation, NASA-Office of Inspector General, Air Force Office of Special Investigations, Navy Criminal Investigative Service and Internal Revenue Service-Criminal Investigations.  Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney’s Office.

St. Louis, MO – WARREN J. GLADDERS, Wentzville, MO, was sentenced to 293 months in prison involving three armed bank robberies committed in July, August and September 2013.  On July 7, 2013, Gladders took approximately $7,000 from the Reliance Bank located in Creve Coeur, Missouri.  On August 2, 2013, Gladders took approximately $5,000 from First National Bank located in Weldon Springs, Missouri.  On September 20, 2013, Gladders took approximately $43,000 from the First Bank located in Marthasville, Missouri.  In each instance, Gladders entered the banking institution and threatened the bank tellers and customers while displaying a firearm.  

On September 20, 2013, Gladders fled the scene of his final bank robbery in his personal vehicle.  Gladders was traveling at a high rate of speed.  A witness outside of First Bank observed the robbery in progress.  The witness was able to obtain a partial license plate number and description of Gladders’ vehicle.  That information was provided to law enforcement officials.  A Missouri State Highway Patrol trooper observed a vehicle matching the description and license plate number and followed it.  The trooper pursued and caught up to Gladders and his vehicle.  The trooper activated his vehicle’s emergency lights and sirens.  Gladders eventually pulled his vehicle over.  The trooper exited his vehicle and demanded that Gladders get out of his vehicle.  As the trooper was exiting his vehicle, Gladders exited his.

As Gladders exited his vehicle, he raised the Smith and Wesson revolver possessed by him and shot at the trooper approximately four times.  One of those shots struck the trooper in the center of the trooper’s chest.  The trooper was protected by his protective vest.  The bullet from Gladders’ firearm penetrated the vest but not the trooper’s body.  The trooper was able to return fire.  The trooper struck Gladders at least once in the leg.  Gladders fell to the ground and the firearm fell out of Gladders’ hand.  Gladders attempted to regain control of his firearm.  The trooper fired additional warning shots at Gladders -- not striking him.  Gladders stopped moving at that point.  The trooper was able to remove Gladders’ firearm from his proximity and place Gladders under arrest.  Multiple law enforcement officials from various agencies responded to the scene.  Gladders was taken into custody and transported for medical attention.

Following Gladders’ arrest, search warrants were obtained for his vehicle, residence and business.  Among other things, most of the items worn or used by Gladders during the armed bank robberies were located and seized by law enforcement.  Furthermore, an officer recovered and seized what is commonly referred to as a “sawed-off shotgun” from inside Gladders’ vehicle.

Gladders pled guilty to the charges in July and appeared today for sentencing before United States District Judge Carol E. Jackson.  The Missouri State Highway Patrol trooper was present in court for the sentencing.

In addition to the Federal Bureau of Investigation, this case was investigated by the Missouri State Highway Patrol, the Warren County Sheriff’s Department, the St. Charles County Sheriff’s Department, the Creve Coeur Police Department, the Montgomery County Sheriff’s Department, the Jonesburg Police Department and the Wright City Police Department, along with coordination amongst the Warren County, St. Charles County and St. Louis County Prosecuting Attorneys’ Offices. 

St. Louis, MO – St. Charles County attorney JEFFREY WITT was sentenced to forty-four (44) month’s imprisonment and five (5) years supervised release following his term of imprisonment, and ordered to pay restitution in the amount of $234,472.33 on charges of falsifying documents to obtain a bank loan secured by a St. Louis County home, which did not actually belong to him, using an associate to impersonate the true home owner at the bank loan closing and cashing legal client settlement checks without their knowledge.

According to court documents and statements made in court, during September 2013, Witt submitted a loan application in the name of his mother in order to obtain a $100,000 line of credit secured by his mother’s St. Louis-area residence.   His mother was unaware of Witt’s loan application. Witt provided a female associate with his mother’s driver’s license, which he had stolen from his mother, along with other false documentation so the associate could impersonate his mother during the loan closing at the bank.  Together they were able to obtain the $100,000 bank loan credit line.   Witt immediately drew out $60,000 from the credit line, which he deposited into his law firm bank account and then withdrew for personal purposes.   Subsequent to the loan closing, Witt’s mother learned of Witt’s action and confronted him.   In order to conceal the scheme, Witt falsely represented to his mother that he had cancelled the loan.   To convince his mother, Witt created a false letter on fake bank letterhead, forged the signature of a bank officer and created a false "Deed of Release," all of which purportedly released the Deed of Trust on his mother’s home securing the fraudulent t loan.

Additionally, as part of his law practice, Witt would enter into settlement discussions on behalf of one and more of his legal clients. Several times, without the knowledge of many of his clients, Witt settled their legal cases, accepted settlement checks on their behalf and forged their signatures on their settlement checks.   Witt deposited the clients’ checks into his law firm bank account and spent those funds on his own personal expenses and business expenses unrelated to those clients without their knowledge. Further, and in order to conceal his scheme, Witt falsely represented to his clients that he had neither settled their cases nor received settlement checks.

Witt also looted a client’s family trust of more than $100,000 over which he had been made Trustee.

During October, 2013, aware of the ongoing federal criminal investigation, Witt fled the United States, traveling to the Philippines, Australia, Jordan, England and Turkey.   Due to the efforts of federal and international law enforcement in tracking Witt, on March 7, 2014, Witt was arrested as he arrived at John F. Kennedy International Airport in New York City on an inbound flight from Istanbul, Turkey.   Witt planned to spend the weekend in New York City and then return to Istanbul on the return airplane ticket recovered from Witt by federal agents upon Witt’s arrest.

Witt, St. Charles, MO, pled guilty in July to one felony count of bank fraud, one felony count of aggravated identity theft and one felony count of mail fraud. He appeared today for sentencing before United States District Judge E. Richard Webber.

This case was investigated by the Federal Bureau of Investigation. Assistant United States
Attorney Hal Goldsmith handled the case for the U.S. Attorney’s Office.

St. Louis, MO – JENNIFER WALTER pled guilty to multiple charges of making false, fictitious and fraudulent claims to the U.S. Department of the Treasury in connection with the filing of false tax returns and the creating of false W-2 forms.

Walter was employed as a tax return preparer for Liberty for All Tax Service in St. Louis, Missouri.  For tax years 2010 through 2012, Walter assisted clients with filing fraudulent tax returns with the Internal Revenue Service.  Walter also made false claims for refunds on her taxes for the tax years 2008 through 2010.  Walter created false W-2 forms in which she claimed false wages and withholdings for herself and others.  The false information reported to the IRS allowed Walter to claim various tax credits for her clients, including child tax credits and the earned income credit, to which her clients otherwise would not have been entitled.  Walter’s fraudulent conduct resulted in the payment of approximately $114,457 in refunds by the IRS.

"Refunds are issued to taxpayers who are entitled to them," said Sybil Smith, Special Agent in Charge of IRS-Criminal Investigation.  "We will aggressively pursue those who prepare false claims for refunds for the purpose of enriching themselves and stealing from the U.S. Treasury."

Jennifer Walter, St. Louis, MO, pled guilty to five felony counts of making false claims upon a department of the United States, before United States District Judge Henry Autrey. Sentencing has been set for January 12, 2015.

Each count of making false claims carries a maximum penalty of five years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by IRS-Criminal Investigation, the Missouri Department of Revenue, Criminal Tax Investigation Bureau and University City Police Department. Assistant United States Attorney Dianna Collins is handling the case for the U.S. Attorney's Office.

St. Louis, MO - ROBERT PALMER and MARK DRIVER were sentenced to 70 months and 30 months in prison, respectively, for defrauding numerous elderly victims of approximately $3,000,000, beginning in 2004 and continuing through 2010.

According to court documents, Princeton Partnership, LLC, was an insurance brokerage business involved in the sale of life insurance products.  Princeton operated out of offices in the Hill area of St. Louis at 1928 Marconi Street (also known as 5149 Daggett Avenue). Palmer and Driver both ran the day-to-day operations of Princeton, solicited customers, marketed the company's services and had financial oversight of the company with authorization over the company's two operating bank accounts. Palmer and Driver solicited Princeton customers with the false promises that they would invest the customers' funds in suitable investments, including but not limited to, real estate, stocks and life insurance annuities.  Examples of those victims include: During 2004 Palmer solicited several members of a family who had received funds upon the death of their elderly aunt with the false representation that Princeton would place those funds in a real estate investment for the benefit of those customers.  Based upon his false representations, the family members transferred some or all of those funds to Princeton.

In 2005 Palmer solicited funds from an elderly individual and her family with the false representation that they would place those funds in a real estate investment for her benefit.  Based on those representations the family transferred her funds to Princeton.

During 2006 through 2010 Palmer solicited investment funds from two elderly sisters with the false representations that Princeton would make suitable investments with those funds.  They transferred their funds and control of their stock holdings to Princeton and, later Palmer and Driver sold and liquidated the stocks. They also persuaded one of the sisters to liquidate a life insurance policy as well and transfer the funds to Princeton.

During 2007 through 2009 Driver solicited investment funds from an elderly woman who transferred her funds, as well as control of her stock holdings, to Princeton. 

In 2006, an elderly woman was solicited by Driver to invest her personally held funds in a series of life insurance annuities through Princeton.  Princeton used her funds to purchase four (4) life insurance annuities.  As a further part of the scheme, during in or about 2008 and 2009, at Driver's direction she liquidated three (3) of her life insurance annuities and provided those funds to Princeton based upon the false representations that the funds would be placed in suitable investments for her benefit.

Most or all of the funds transferred to Palmer, Driver and Princeton by the numerous victims were used by Palmer and Driver for their own personal uses and the general operating expenses of Princeton.  Palmer and Driver also engaged in Ponzi-type transactions where they used some funds provided by new customers to pay old customers who falsely believed they were receiving the returns on their purported investments.

In all cases Palmer and Driver obtained approximately $3,000,000 from Princeton customers based upon their false representations, which they used for their own personal use and for the expenses of their company, Princeton.

Palmer, Kansas City, MO; and Driver, St. Louis, MO, pled guilty in June to two felony counts of mail fraud and two felony counts of wire fraud. They appeared today for sentencing before United States District Judge Rodney Sippel. 

This case was investigated by the Federal Bureau of Investigation and the Postal Inspection Service, with assistance of the Missouri Secretary of State’s Office.  Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney's Office.

St. Louis, MO – RAJU MUKHI pled guilty to failing to file a report to the IRS on his foreign financial accounts and for filing false tax returns.

United States citizens are required to report income from foreign countries, such as bank accounts, securities and any other financial accounts on their tax returns.  If the value is more than $10,000, they are required to file a Report of Foreign Bank and Financial Accounts, Form TD F90-22.1 (FBAR). 

According to court documents, Mukhi failed to disclose the existence of Clariden Bank and Goldman, Sachs & Company Bank-Singapore accounts and the income earned in these accounts, to his tax preparers for the years 2006 and 2008.  Additionally, Mukhi, failed to file an FBAR disclosing that he had financial accounts in Singapore and Switzerland for years 2007-2010.

"Every honest American who pays his or her taxes should be offended that a select few use anonymous offshore accounts to avoid paying their fair share," said Sybil A. Smith, Special Agent in Charge, IRS Criminal Investigation. "It is our duty to the American taxpayer to use all lawful means to identify and prosecute those who use offshore accounts to evade their taxes."

Mukhi, St. Louis, MO, pled to one felony count of filing false tax returns and one felony count of failure to file reports of foreign bank and financial accounts.  He appeared before United States District Judge Audrey G. Fleissig.  Sentencing has been set for January 15, 2015.

Each count of filing false tax returns carries a maximum penalty of three years in prison and/or fines up to $100,000; each of the other counts carry a maximum penalty of five years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by Internal Revenue Service-Criminal Investigation.  Assistant United States Attorney Dianna Collins is handling the case for the U.S. Attorney's Office.

St. Louis, MO – PATRICIA HOEHN allegedly wrote prescriptions for hydrocodone for three different people representing that they were prescribed by a licensed medical doctor.  She is also charged with attempting to destroy her cellular telephone so that investigators could not find information about her diversion of these controlled substances.

Hoehn, Farmington, MO, was indicted by a federal grand jury on three felony counts of obtaining a controlled substance by forgery, three felony counts of making false statements relating to a health care matter, one felony count of fraud with identification documents and one felony count of attempting to destroy a cellular telephone to impair official proceeding. She is expected to appear in federal court today.

If convicted, these charges carry penalties ranging from 4 to 20 years in prison and/or fines up to $250,000.  In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Missouri State Highway Patrol, the Drug Enforcement Administration and Health & Human Services Office of Inspector General.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – PETER GIAMBALVO was convicted of obstructing the internal revenue laws and filing false tax returns for the years 2003-2010.  The three-day trial was held before United States District Judge Rodney W. Sippel.

According to testimony presented at trial, Giambalvo was an employee of The Boeing Company and had not filed income tax returns for the years 2000-2009. After being contacted by an IRS Revenue Officer in late 2010, Giambalvo agreed to file income tax returns for those years. However, in January 2011, Giambalvo mailed tax returns to the Revenue Officer for years 2000-2010. Each of these returns stated that the amount of wages and other items of income which he received during those years was zero. However, for the years 2003-2010, there was evidence that Giambalvo received wages from The Boeing Company in amounts substantially in excess of the zero amounts reported on the returns. Giambalvo also included a letter to the Revenue Officer which claimed that he was a "nontaxpayer," and was not required to pay taxes because he worked in the private sector and not for the government.

"The law is clear on the issue of taxable income and who is required to file and pay taxes:  There is no gray area on the subject," said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation.  "Today’s conviction shows that those who willfully defy the tax laws, regardless of their motivations or convictions, will be held accountable.".

Giambalvo, Hawk Point, MO, was convicted of one felony count of interfering with the administration of the Internal Revenue laws, and eight felony counts of filing false tax returns. Sentencing has been set for January 2, 2015. After the jury verdict, Judge Sippel ordered that Giambalvo be held in custody until sentencing.

Each count carries a maximum penalty of three years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Steven Muchnick is handling the case for the U.S. Attorney's Office.

St. Louis, MO – The mayor of Pine Lawn, Missouri, SYLVESTER CALDWELL, has been arrested as a result of an indictment charging him with extortion of cash payments from the owner of a local towing company.

Caldwell, Pine Lawn, was indicted by a federal grand jury on one felony count of interference with commerce by extortion. He was arrested by FBI agents Thursday.  He appeared in court late yesterday afternoon and was released on bond.  Caldwell is scheduled for arraignment Monday, September 29, at 9:30 a.m.

According to the indictment, Mayor Caldwell exercised authority over which towing companies provided the towing services for the City of Pine Lawn.  The indictment alleges that between December 2013 and April 2014, Caldwell extorted cash payments from the owner of one local towing company, referred to in the indictment as "John Doe," in exchange for directing the Pine Lawn Police Department to use Doe’s towing company. 

If convicted, this charge carries a maximum penalty of 20 years in prison and/or fines up to $250,000. In determining the actual sentence, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. 

This case was investigated by the Federal Bureau of Investigation.  Assistant United States Attorney Reginald Harris is handling the case for the U.S. Attorney’s Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.        

St. Louis, MO – CHRISTOPHER DAVID HENDRICKS, JR. was indicted for his alleged August 29 robbery of the First State Community Bank in DeSoto, Missouri.

Hendricks, Hillsboro, MO, was indicted by a federal grand jury on one felony count of robbery of a federally-insured institution. He appeared for arraignment in federal court this morning.

If convicted, this charge carries a maximum penalty of 20 years in prison and/or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Tom Mehan is handling the case for the U.S. Attorney’s Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – JILLIAN NICHOLS, a local paralegal, was sentenced to 15 months in prison on charges involving her attempt to defraud a law firm client by falsely representing that the prosecutor on the client’s criminal case had solicited a bribe.  Nichols also lied to the FBI during their investigation of her illegal conduct.
 
According to court documents and statements made in court at the time of her guilty plea hearing, Nichols worked for a local law firm, assisting one of the firm’s attorneys on his legal cases.  She had no formal legal training and was paid hourly. While she was working at the firm, she worked on the defense of a state felony criminal case pending in St. Louis County Circuit Court against a firm client.  As part of her duties, she worked closely with the client in investigating and helping prepare his defense, often meeting with him, as well as speaking with him on the telephone and texting, outside the presence of the defense attorney.  Nichols left the defense attorney’s firm in September 2013.  After Nichols left the law firm she continued to meet with the client and discuss his criminal case with him.  Between June and December 2013, Nichols engaged in a scheme to defraud the client by falsely telling him that the St. Louis County assistant prosecutor assigned to his case had solicited a bribe of $10,000 in order to give favorable consideration in his pending criminal case. Further, she falsely represented that she had favorable evidence “planted” on the client’s cell phone in order to support his defense. She also falsely represented that she had paid the forensic expert hired by the defense attorney to analyze his cell phone so that the expert would validate and verify the “planted” evidence.  On November 15, 2013, in response to Nichols’ false statements about the $10,000, the client agreed to give her an initial $5,000 in cash for her to pay the bribe to the prosecutor, and then an additional $5,000 after the prosecutor gave him favorable consideration in his pending criminal case. In order to conceal the scheme, she told the client not to tell his defense attorney of their discussions about bribing the prosecutor or planting evidence on his cellular phone. 

During the FBI’s investigation of her fraud scheme, Nichols lied repeatedly to Special Agents about her involvement in the scheme when they interviewed her during December 2013.

Nichols, St. Louis, pled guilty July 1st to one count of wire fraud and one count of making false statements. She appeared today for sentencing before United States District Judge Rodney W. Sippel. 

This case was investigated by the Federal Bureau of Investigation-Public Corruption Task Force, including officers of the St. Louis Metropolitan Police Department.  Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney's Office.

Cape Girardeau, MO –MIDWEST NEUROSURGEONS LLC and its owner, DR. SONJAY FONN, and DS MEDICAL LLC and its owner, DEBORAH SEEGER, were indicted for allegedly violating the Medicare Anti-Kickback Statute by conspiring to solicit and receive commissions from medical device manufacturers related to the purchase of spinal implants and supplies used during spinal fusion surgeries performed by Dr. Fonn.

According to the indictment, Dr. Fonn and his fiancée, Ms. Seeger, both of Cape Girardeau, jointly operated DS Medical LLC to serve as the distributor of medical devices and supplies to Dr. Fonn and his neurosurgery practice, Midwest Neurosurgeons LLC. Through DS Medical, Ms. Seeger and DS Medical demanded and were paid exorbitant commissions by medical device manufacturers for medical devices and supplies purchased by the hospital where Dr. Fonn performed spinal fusion surgeries. The hospital’s purchases were based on Dr. Fonn’s decision to use those devices and supplies during operations he performed. According to the indictment, once DS Medical started operating, Dr. Fonn altered the way he practiced medicine, generally using more spinal implants in each of his surgeries while performing more surgeries than he typically performed before or after DS Medical was operating. In December 2008, the first full month of operation for DS Medical, Dr. Fonn ordered approximately $1,330,090 worth of spinal implants for his surgeries, more than twice as much as his nearest medical peer in the local health care market.  The commissions paid to DS Medical and Ms. Seeger by the manufacturers were allegedly used to purchase a house where Dr. Fonn and Seeger resided, a boat, an airplane and various home improvements, which they shared.

Dr. Sonjay J. Fonn, Deborah Seeger, DS Medical, LLC and Midwest Neurosurgeons, LLC were indicted by a federal grand jury today in Cape Girardeau on one felony count of conspiracy to solicit and receive illegal kickbacks and three felony counts of anti-kickback violations.

If convicted, each of the charges against Dr. Fonn and Deborah Seeger carry a maximum penalty of five years in prison and/or fines up to $250,000.  In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation and the United States Department of Health and Human Services-Office of the Inspector General. Assistant United States Attorney Dorothy McMurtry is handling the case for the U.S. Attorney’s Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO – These five men were indicted for their alleged conspiracy and distribution of large quantities of cocaine and methamphetamine in Audrain County.  Travis and Cody McDonald are also charged with growing over 100 marijuana plants between September 2007 and the present time and laundering the proceeds of the illegal activity. 

The defendants were arrested by agents Monday.

Individuals indicted:

• TRAVIS EUGENE McDONALD, Montgomery City, Missouri,
• CODY WAYNE McDONALD, Vandalia, Missouri,
• WILLIAM RAY LAIRD, Vandalia, Missouri,
• RUSSELL DALE GAY, Columbia, Missouri, and
• JOHN WESLEY HARRISON, Annada, Missouri

If convicted, each count of conspiracy to distribute in excess of 500 grams of cocaine and conspiracy to manufacture in excess of 100 marijuana plants carries a penalty range of 5 to 40 years in prison and or fines up to $5 million. Conspiracy to distribute in excess of 500 grams of methamphetamine carries a penalty range of ten years to life in prison. Money laundering carries a maximum penalty of 20 years in prison and/or fines up to $500,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Drug Enforcement Administration, Internal Revenue Service, the East Central Missouri Drug Task Force, the North Eastern Missouri Drug Task Force, Missouri Highway Patrol, Audrain County, Lincoln County and Warren County Sheriff’s Departments and St. Louis, Troy and Jefferson City, Missouri Police Departments.  Assistant United States Attorney John T Davis is handling the case for the U.S. Attorney's Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

St. Louis, MO - JACK FRISON, SR. was convicted of multiple charges relating to his involvement in the sale of counterfeit goods and DVD?s.

According to testimony presented at trial, for more than two decades, Frison owned and operated the Frison Flea Market, in Pagedale, Missouri.  Vendors paid Frison a rental fee to rent and operate sales booths at his Flea Market.  For more than ten years, many of Frison’s vendors openly sold counterfeit goods from their booths at the Market.  The counterfeit goods included clothing, footwear, purses, accessories, movie DVDs and music CDs.  Some of the vendors sold counterfeit purses and similar luxury items bearing marks owned by Coach, Louis Vuitton, Dolce & Gabbana and others. Frison knew that the goods were counterfeit and allowed vendors to continue selling such goods.  Rather than removing vendors selling illegal goods, Frison fined them instead, adding to his income.

Frison, Frontenac, Missouri, was convicted of one felony count of conspiracy to traffic in counterfeit goods, one felony count of aiding and abetting copyright infringement and one felony count of aiding and abetting trafficking counterfeit goods.  The two-day trial was held in June before United States District Judge Rodney Sippel.  He returned his ruling today and set sentencing for January 2015.

The conspiracy and copyright infringement charges each carry a maximum penalty of five years in prison and/or fines up to $250,000 and trafficking in counterfeit goods carries a maximum of 10 years in prison and/or fines up to $2,000,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), the Federal Bureau of Investigation, the St. Louis Metropolitan Police Department and the St. Louis County Police Department. Assistant United States Attorneys John Bodenausen and Jennifer Roy are handling the case for the U.S. Attorney's Office.

St. Louis, MO – REGINA DANKO, of Ivyland, Pennsylvania, pleaded guilty to participating in a conspiracy to defraud the United States in federal court this morning.   Danko, the principal shareholder of Tri-Ark Industries, Inc., a government contracting firm located in the Philadelphia area, admitted to conspiring to make false statements and defraud the government in connection with a five-year contract to provide janitorial services at the Robert A. Young, Jr. federal building in downtown St. Louis.

According to the plea agreement, Danko conspired with others to provide a false joint venture agreement and other false representations to government contracting officials that the firm bidding on the company was owned in the majority and controlled by a service disabled veteran to comply with rules for government contracts set aside for firms owned by such veterans.   Danko admitted that the veteran with whom she partnered was merely a straw person and, contrary to her representations to the government, had no duties with the contract and accepted only small annual payment so that his name and status could be used.   Danko also admitted the project manager at the Robert A. Young, Jr. building and another employee of Tri-Ark participated in the scheme.   From 2007 to 2012, Tri-Ark collected more than $8.7 million dollars under this contract and almost all of the profits earned on the contract were retained by Tri-Ark to the benefit of Danko.

Danko pleaded guilty to one count of conspiracy to commit an offense against the United States in violation of Title 18, United States Code, Section 371.   At sentencing, which was set for December 11, 2014, she faces up to five years imprisonment, a fine of up to $250,000 or both.   In addition to these penalties, Danko agreed to the criminal forfeiture of more than $2.4 million dollars, which was seized by investigators.   Danko has also acquiesced to the non-renewal of a successor contract she held at the Robert A. Young, Jr. building with an unrelated service-disabled veteran.

The case was investigated by the General Services Administration-Office of the Inspector General, the U.S. Department of Veterans Affairs-Office of the Inspector General and the St. Louis Division of the FBI.  Assistant U.S. Attorney Tom Albus is handling the case for the U.S. Attorney’s Office for the Eastern District of Missouri.

St. Louis, MO – BEVERLY SUSAN RENE SMITH was sentenced to six months of home confinement and five years of probation on charges involving her theft of approximately $176,000 from Million-Taylor Funeral Home.  These funds were intended to cover customer’s funeral expenses. She was also ordered to pay restitution of $175,705.

According to court documents, Smith was hired by the original owner of the Million-Taylor Funeral Home (MTFH) in Moberly.  James Taylor, Sr. hired Smith in 2001 as the office manager, a job she held from 2001 to June 2012.  Her position included payroll expenses and expenses to vendors for the costs of funerals.  She also received payment for funerals, which she recorded in a financial ledger.  Additionally, she was required to report all of MTHF’s financial transactions to their accounting firm, Federated Funeral Directors of America (Federated). Smith also had access to MTHF’s banking, general fund and escrow accounts. 

To pay for funeral expenses of a client, MTHF first used money from its general operating fund to cover these expenses.  Then Smith was supposed to recoup payment for the funeral expenses from the representatives or family members of the deceased, from the life insurance of the deceased and/or from pre-needs insurance accounts of the deceased.  When the payments were received, Smith was to deposit them back into the general fund.  If she was not able to recoup full payment for funeral expenses of a client, she reported this information to Federated and informed them that the account was a bad account and that they should write it off as no further effort would be made to recoup payment for these expenses. This way she was able to conceal that she had stolen some client payments made for funeral expenses, which she deposited into the escrow account.  

While James Taylor, Sr. operated MTHF, he allowed customers to pay money for their expected funeral expenses before they died.  MTHF deposited this money into MTHF’s escrow account.  He and Smith were the only employees who had access to the escrow account.  After James Taylor, Sr. died in 2006, Smith concealed the existence of the escrow account from other MTHF employees. On several occasions Smith took the payments that were sent to MTHF for funerals, and instead of depositing them into the general fund, she deposited the funds into the escrow account. Smith was able to withdraw funds from the escrow account undetected to use for her personal use, including the purchase of clothing and jewelry.  She hid the withdrawals by manipulating the financial records of MTHF.

Smith, Higbee, MO, pled guilty in May to one felony count of wire fraud, and appeared in St. Louis today for sentencing before United States District Judge Rodney Sippel.

The case was investigated by the Federal Bureau of Investigation and the Missouri State Highway Patrol.  Assistant United States Attorney Anthony Franks handled the case for the U.S. Attorney’s Office.

St. Louis, MO – MARSHA HARRINGTON,CALVIN SHAW and LARRY CORNER, all of the St. Louis area, have entered guilty pleas to one felony count of conspiracy to commit identity theft and one felony count of identity theft.  Corner appeared in court Tuesday afternoon, Harrington and Shaw entered their pleas in July.  All defendants appeared before United States District Judge Catherine D. Perry.  Sentencing for Corner has been set for November 12, 2014. Harrington and Shaw will be sentenced in October.

According to court documents, Marsha Harrington used her employment as manager of the Clinton-Peabody Housing Complex to acquire social security numbers and other personal information from tenants, and used this information to file false tax returns.  Co-defendants Calvin Shaw and Larry Corner also provided identity information to Harrington.  After Harrington filed the false tax returns, she kept the tax refund.  If the tax return used a stolen name and social security number provided by Shaw and/or Corner, she shared those funds with them respectively.

"Misusing her position of trust as Manager of the Clinton-Peabody Housing Complex, Ms. Harrington stole the identities of people and filed false tax returns in their names," said Sybil Smith, Special Agent in Charge of IRS Criminal Investigation.  "Let me be clear that we will continue to pursue the criminals who seek to willfully defraud the United States Treasury and blatantly disregard the victims of their schemes."

Conspiracy to commit identity theft carries a maximum penalty of five years in prison and/or fines up to $250,000 and identity theft carries a maximum of 15 years in prison and or fines up to $250,000.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by IRS Criminal Investigation. Assistant United States Attorney Stephen Casey is handling the case for the U.S. Attorney's Office.

St. Louis, MO – SUSAN WINEBARGER was sentenced to thirty-eight (38) months imprisonment for embezzling more than $600,000 from company accounts and falsifying documents to conceal the embezzlement.  Winebarger was also ordered to pay restitution of $699,897 to the company.

According to court documents, Winebarger was Chief Financial Officer, then Chief Executive Officer of VNA-TIP of Bridgeton, Missouri.  VNA-TIP provides visiting nurse care, hospice care and related patient care service in Missouri and Illinois.  In this capacity, she ran the day-to-day business and financial operations of VNA-TIP, including reconciling bank statements and having full access to bank checks for the company’s operating and payroll accounts.  Winebarger also directly coordinated payments to the outside Administrator for VNA-TIP’s employee 401(k) plan.  Between January 2008 and December 2013, Winebarger embezzled approximately $600,000 from VNA-TIP accounts.  Without company authority, Winebarger issued more than two hundred (200) checks to herself from both the operating account and its payroll account and deposited those checks into her personal bank accounts. She also used the company debit card to purchase personal items.  In order to conceal her scheme, she made sure she received all the bank account statements, which she altered for submission to VNA-TIP auditors.  She also falsified internal financial reports, including monthly profit and loss statements submitted to the shareholders and board members.  Winebarger failed to remit moneys withheld from VNA-TIP employees’ paychecks for their individual 401 (k) retirement accounts to the plan administrator so that the cash reserves would be falsely inflated in order that VNA-TIP shareholders, board members and auditors would not be aware of the true financial status of the company and potentially discover her theft and embezzlement.  She also failed to remit state and federal withholding taxes, social security and Medicare funds.   

Winebarger, Highland, IL, pled guilty to two felony counts of wire fraud in May. She appeared today for sentencing before United States District Judge John A. Ross. 

This case was investigated by the Federal Bureau of Investigation.   Assistant United States Attorney Hal Goldsmith handled the case for the U.S. Attorney's Office.

St. Louis, MO – DANIELA SPIRIDON was sentenced to 78 months in prison involving a real estate scheme related to the purchase or sale of properties.  In addition to the prison sentence, she was also ordered to pay $2,499,988 restitution and a fine of $5,000.
           
According to court documents, Spiridon was affiliated with several businesses from an office in Chesterfield, Missouri, which included A & AD Investments, LLC; CDRS ESC Investments; Sentrix Loan Production Office and others.  As part of the scheme, Spiridon fraudulently offered to assist buyers in the purchases of properties that were acquired by lenders through foreclosure and held in inventory, known as Real Estate Owned (REO) properties.  She offered to broker purchases or arrange for financing related to the purchase or sale of the REO properties.  She had potential buyers place deposits on the properties, which she was to put into an escrow account, but she actually put the monies in a non-escrow account in one of her own companies.  She often used buyers’ funds for personal expenses and to reimburse other buyers who demanded their funds be returned rather than to secure real property or financing.

Spiridon, St. Charles, MO, pled guilty last September to six felony counts of wire fraud. She appeared today for sentencing before United States District Judge John A. Ross.

This case was investigated by the Federal Bureau of Investigation, Postal Inspection Service and Federal Housing Finance Agency-Office of Inspector General.  Assistant United States Attorney Rob Livergood is handling the case for the U.S. Attorney's Office.

St. Louis, MO – BRYAN BINKHOLDER was indicted on multiple fraud charges involving his financial planning and investment strategy businesses.

According to the indictment, Binkholder labeled himself "The Financial Coach" and provided investment and financial planning advice to the general public through his affiliated websites, YouTube channel, published books and articles and an investment related talk-radio show that aired on local radio stations. In 2008, he developed a real estate investment he termed "hard money lending."  Using his platform as an investment advisor and financial talk show host, Binkholder solicited his clients and others to invest in the hard money lending program.  As part of his sales pitch he represented that he had relationships with developers in the real estate community who wanted to purchase, renovate and sell residential real estate in the St. Louis area, but were not able to secure financing from traditional banks.  As part of the hard money lending program, Binkholder told investors that they would invest money with him, and he would act as a bank and provide short-term loans to these developers at a high rate of interest, which would be shared with the investor.  Instead of exclusively making hard money loans as promised, he commingled the vast majority of investor money across a number of different accounts.  Binkholder then allegedly used the commingled funds to pay interest to subsequent investors and pay personal expenses. The indictment states that Binkholder took in millions of dollars of investor money, made only a small number of hard money loans and caused investors to lose more than $3,000,000.

Binkholder, Wentzville, MO, was indicted by a federal grand jury on four felony counts of wire fraud and one felony count of bank fraud. He is expected to appear in federal court today.

Additionally, upon a finding of guilt, the defendant will be subject to a forfeiture allegation, which will require the forfeiture to the government all monies and property derived from the illegal activity. 

If convicted, each of these charges carries a maximum penalty of 30 years in prison and/or fines up to $1 million.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

 This case was investigated by the Federal Bureau of Investigation and the Postal Inspection Service. Assistant United States Attorney Stephen Casey is handling the case for the U.S. Attorney’s Office.

As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty.

At the request of local authorities and at the direction of Attorney General Eric H. Holder, Jr., our respective offices have opened a civil rights investigation into the shooting death of Michael Brown that occurred in Ferguson, Missouri, this past Saturday.  In conducting the independent federal investigation into whether there were federal civil rights violations, we will be working as much as possible with the local authorities who are determining whether there were any state law violations. While the investigation will be handled as expeditiously as possible, our pledge to the community is that it will be a thorough and complete investigation, following the facts wherever they may take us. 

We urge witnesses or individuals with any information related to the incident who have not yet come forward to contact the local FBI office.  The FBI office in St. Louis can be reached at (314) 589-2500.

St. Louis, MO – SABAHADDIN AKMAN, the owner and manager of a Turkish drug wholesaler, pled guilty today to smuggling misbranded and adulterated cancer treatment drugs into the United States, including multiple shipments of Altuzan® (the Turkish version of Avastin®) sent from Turkey to Chesterfield, Missouri.

Akman entered his plea before United States District Judge Audrey G. Fleissig in St. Louis, MO.  He now faces a penalty range of up to twenty years in prison.  In his plea agreement, Akman agreed to pay a fine of $150,000 if imposed by the Court, plus a $150,000 forfeiture payment to the United States.  Sentencing has been set for November 18, 2014.

According to Akman’s plea agreement, Akman, through his company and employees, used shipping labels that concealed the illegal nature of the prescription drug shipments, including customs declarations falsely describing the contents as "gifts" with no or low declared monetary values.  Some cancer chemotherapy prescription drugs sent by defendant to the United States from Turkey had different lot numbers on the exterior packaging of the drugs than the lot numbers found on the actual vials of the drug inside the packages.  Additionally, Akman shipped some prescription drugs that needed constant cold temperatures to maintain their stability and effectiveness in shipping boxes without insulation or any temperature protection whatsoever. 

Further, Akman admitted in his plea agreement that his company and employees sold Altuzan® to Richard Taylor, a United Kingdom drug wholesaler.  The U.S. Food and Drug Administration’s (FDA) Office of Criminal Investigations (FDA-OCI) previously seized Altuzan® from various physician/customers of Taylor in 2012, and ultimately determined that this Altuzan® from Taylor and Semizoglu actually contained mold and water, with no active drug ingredient in the drug vials.  FDA issued several public safety alerts about these events.  FDA-OCI’s ongoing investigation has led to a number of related prosecutions in this District, including Dr. Abid Nisar, Sandra Behe, James Newcomb, Richard Taylor, Dr. Erick Falconer, Greg Martin, Kamaldeep Sandhu and Navdeep Sandhu.

"Of all U.S. consumers, those with cancer are among the most vulnerable and most in need of proven effective treatments.  To prey on that vulnerability is to exploit the health of those individuals and of the public at large," said Philip J. Walsky, acting director, FDA Office of Criminal Investigations. "OCI commends its colleagues - international, national, state and local - for their collaborate efforts in bringing this criminal to justice."   

This case was investigated by FDA’s Office of Criminal Investigations, with assistance from the United States Marshal’s Service, Rosa Emilia Rodríguez-Vélez , the United States Attorney for the District of Puerto Rico, the Office of Inspector General for the U.S. Department of Health and Human Services, the Johnson County, Kansas Sheriff’s Office Criminalistics Laboratory, Europol, the Bonn prosecutor in Germany (Staatsanwaltschaft); the Federal Criminal Police of Germany (Bundeskriminalamt, BKA); the Dusseldorf Police, the German State Criminal Police (Landeskriminalamt, LKA), the U.S. Department of State’s Diplomatic Security Service, the U.S. Consulate General’s Overseas Criminal Investigations Branch in Istanbul, Turkey and the Drug Enforcement Administration, Istanbul Resident Office.  

St. Louis, MO – BRADLEY FERGUSON, owner of Fenton-based Paymaster Business Solutions, Inc., pled guilty to mail fraud and money laundering charges involving his failure to remit federal, state and local taxes to the proper taxing authorities that had been deducted from victim client bank accounts.  Ferguson also failed to remit FICA withholding to the IRS on behalf of his business clients.  Ferguson’s clients included churches, youth organizations, child daycare facilities, law firms and other businesses throughout the St. Louis area.

According to court documents, from January 2005 through January 2014, Ferguson drafted funds directly from Paymaster business clients’ bank accounts in order to pay their federal, state and local tax liabilities.  However, Paymaster, at Ferguson’s direction, failed to forward the Paymaster business clients’ funds to the taxing authorities in order to pay their tax liabilities then due and owing.  Paymaster drafted in excess of $2,700,000 from Paymaster business clients’ bank accounts to pay client’s federal, state and local tax liabilities, as well as FICA liabilities, for the period July 2013 through December 2013, but were not forwarded to the proper taxing authorities. Additionally, Ferguson,as Power of Attorney for Paymaster business clients, was contacted directly by the IRS and questioned as to the failure of the payments of client federal tax liabilities.  Fergusondid not tell his clients about the IRS inquiries.  When clients occasionally learned that Paymaster had not forwarded their funds to the taxing authorities, Ferguson lied to them and told them Paymaster had made the payments. In December 2013, Ferguson retained the services of a commercial shredding company and directed that the Paymaster business client records be shredded and removed from the Paymaster offices.

Ferguson, Washington, MO, pled guilty to one felony count of mail fraud and one felony count of money laundering before United States District Judge E. Richard Webber.  Sentencing has been set for November 6, 2014.

Additionally, Ferguson is subject to a forfeiture allegation, which will require the forfeiture to the government of all money derived from the illegal activity. 

Mail fraud carries a maximum penalty of 20 years in prison and/or fines up to $250,000; money laundering carries a maximum of 5 years.  In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation, Postal Inspection Service and Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Hal Goldsmith is handling the case for the U.S. Attorney's Office.

St. Louis, MO – REGINALD WILLIAMS was sentenced to 240 months on multiple charges involving the interstate transportation of two minors with the intent to engage in prostitution. 

According to testimony presented at trial, on September 12, 2012, Collinsville, Illinois police received a report regarding a missing 16-year-old girl who was being forced to work as a prostitute by one or several adult males. The person reporting the information was familiar with online postings on the website, www.backpage.com, in which photographs of the girl were used to offer her services for commercial sex. The telephone number associated with the advertisement was recognized to be used by "Reggie," who was later identified as defendant Reginald Williams. Detectives reviewed the on-line advertisement, which contained sexually suggestive language and listed the poster’s age to be 20 years old.  However, Illinois police were able to confirm that the girl was born in 1996.

Investigators also learned that a second minor female was believed to be in the 16-year-old’s company at a hotel in St. Louis County.  Detectives from Illinois then contacted the St. Louis FBI and the St. Louis County Police Department. 

On September 13, 2012, an undercover detective called the phone number listed in the online advertisement to set up a paid sex "date" with the two girls. When officers arrived at the hotel, they observed a person later identified as defendant Reginald Williams exit the same hotel room where the two minor females were eventually found. Williams was arrested on the parking lot.  When officers went to the room they found both girls, ages 16 and 17.  Thereafter, officers determined that Williams transported the 16-year-old girl to the St. Louis area and Chicago with the intent she engage in prostitution.  Officers also determined that Williams had attempted to recruit the 17-year-old girl and posted her on www.backpage.com, in which photographs of the girl were used to offer her services for commercial sex as well.

Williams, from the Chicago, Illinois area, was convicted in March of one felony count each of interstate transportation of a minor with the intent to engage in prostitution, sex trafficking a minor, attempted sex trafficking of a minor, possession of a firearm in furtherance of a crime of violence, and use of interstate facilities to promote prostitution.  He appeared today for sentencing before United States District Judge Jean C. Hamilton.

In addition to the Collinsville, Illinois and St. Louis County police departments, this case was also investigated by the Federal Bureau of Investigation.

St. Louis, MO – JODY EUGENE SMITH, Pevely, Missouri, was sentenced to 720 months in prison on multiple child pornography charges, including production, attempted production, receipt and transportation. Smith pled guilty to the charges in April and appeared today for sentencing before United States District Judge Henry Autrey.

This case was investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), Florida Department of Law Enforcement and the St. Louis County Police Department.   Assistant United States Attorney Rob Livergood handled the case for the U.S. Attorney's Office.

St. Louis, MO – LIEUTENANT PARRISH SWANSON and OFFICER RAYMOND STEPHENS pled guilty to charges of conspiracy to distribute and attempted distribution of heroin.

According to court documents, during March 2014, Swanson and Stephens agreed to assist an associate, a suspected drug dealer, rob or what is more commonly referred to as "rip off," a drug courier of an amount of heroin within the City of Hillsdale.  The associate agreed to pay Swanson and Stephens cash for their assistance in this "rip off."  On March 20, 2014, Stephens, while on duty as a Hillsdale police officer, approached the drug courier and robbed him of approximately four ounces of suspected heroin.  He later met with the associate and gave him the heroin in exchange for $900 cash.  Stephens then gave Swanson $200 of the $900 per their previous agreement. 

Swanson, St. Louis, Missouri; and Stevens, St. Charles, Missouri, pled guilty to one felony count each of conspiracy to distribute heroin and attempt to distribute heroin before United States District Judge Rodney W. Sippel. Sentencing for both defendants has been set for October 2014.

Each count carries a maximum penalty of 20 years in prison and/or fines up to $1 million.  In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

This case was investigated by the Federal Bureau of Investigation and the St. Louis County Police Department.  Assistant United States Attorneys Hal Goldsmith and John Bodenhausen are handling the case for the U.S. Attorney's Office.

St. Louis, MO – VICTORIA JEAN BRILEY, of Wentzville, admitted to collecting $138,000 in veteran’s benefits in the name of her deceased mother. 

According to the plea agreement, after her mother’s death in 2006, Briley maintained control over a bank account in her mother’s name which received the monthly payments from the U.S. Department of Veterans Affairs.  When confronted by investigators, Briley admitted she had been concealing her mother’s death from the government and improperly receiving the benefits for years.

Briley pled guilty to one count of theft of government funds before United States District Judge Audrey G. Fleissig. Sentencing has been set for November 4, 2014. 

The maximum term of imprisonment for theft of government funds is 10 years and/or a fine of $250,000.  Restitution to the government is also mandatory. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

The case was investigated by the U.S. Department of Veterans Affairs-Office of Inspector General.  Assistant United States Attorney Tom Albus is handling the case for the U.S. Attorney’s Office.

St. Louis, MO – TINA KUEHL was sentenced to 51 months in prison on multiple healthcare fraud charges and separate unrelated bank fraud charges and ordered to pay $200,000 restitution. Her company, Better Way Home Care, was sentenced to three years of probation and also ordered to pay $200,000 restitution. Kuehl and Better Way represented on billing work sheets and claim forms that patients had received therapy services when they knew that the patients had not received the therapy. Kuehl and Better Way caused the submission of hundreds of reimbursement claims to Medicare for services which they knew had not been provided.
 
According to court documents regarding the bank fraud charges, in December 2010, Kuehl’s mother obtained a $305,000 property loan from the Community Bank of Owensville, MO, a branch of the Maries County Bank.  Both Kuehl and her mother are listed on the deed of trust for the property.  On many occasions, they did not make timely payments on the loan, and in July 2013, Maries Bank foreclosed on the property. After the foreclosure, Kuehl devised a scheme to defraud Maries Bank by submitting fraudulent checks as proof that she had made loan payments to the bank. On six occasions, she changed the payee on copies of unrelated cancelled checks so that it would appear that she had made loan payments to Community Bank of Owensville. She continued the fraud by claiming to have made cash payments to a bank employee on two occasions. The bank employee was on sick leave on the day Kuehl claimed she made the first $4,000 cash payment to the employee at the bank. Kuehl claimed that she made a second cash payment of $6,900 to a bank employee at a truck stop.  Finally, Kuehl retained attorneys to represent her after the foreclosure, and falsely told them she had made payments by checks and cash, which the bank had not credited to her loan account. 

According to court documents regarding the healthcare fraud charges, Better Way was a home health care agency located in Ellisville, Missouri.  Tina Kuehl was the owner, president, and administrator of Better Way and was responsible for the day-to-day operations. Medicare pays home health agencies for 60-day episodes of care. Medicare makes two payments to the home health care agencies, the first before the service is provided based on the patient’s anticipated need for services and a second payment at the end of the 60-day episode of care based on the actual number of services provided.

Kuehl has no medical or health care education, training or experience, which would qualify her to assess or evaluate patients or determine their care needs.  Prior to opening Better Way, she worked in the cosmetology field.  Better Way hired nurses and contracted with therapists to assess and evaluate patients and to determine the patients’ needs for therapy services. Better Way staff recorded this information on the Outcome and Assessment Information Set form (OASIS).

To increase the reimbursement that Better Way would receive, Kuehl directed Better Way nurses and other employees to make false statements on the OASIS forms and the reimbursement claim forms. At Kuehl’s direction, the staff increased the number of therapy visits, although Kuehl knew the patients did not need and had not received the therapy; falsified the diagnosis codes; and exaggerated the patients’ conditions and the reasons the patients were receiving home health care services from Better Way. When some employees refused to increase the number of therapy visits, Kuehl personally increased the number of visits.  In some instances the patient had received no therapy at all.

Kuehl, Ballwin, MO, pled guilty May 1st to one felony count of bank fraud, one felony count of healthcare fraud, two counts of making false statements relating to healthcare and one count of making false statements to federal agents. She appeared today for sentencing before United States District Judge Henry Autrey.

This case was investigated by the Office of the Inspector General of the U.S. Department of Health and Human Services and the FBI. Assistant United States Attorney Dorothy McMurtry handled the case for the U.S. Attorney's Office.